Delaware Focus Global Growth Fund

Objective

Delaware Focus Global Growth Fund seeks long-term capital appreciation.

Strategy

The Fund invests primarily in common stocks of U.S. and non-U.S. companies, which may include companies located or operating in developed or emerging markets. Under normal circumstances, the Fund will invest in equity securities of issuers located throughout the world, including the United States, and the Fund will invest at least 40% of its net assets in non-U.S. securities. The Fund may invest in companies across all market capitalizations but will primarily invest in mid- and large-cap equity securities.

Fund information
Inception date12/29/2008
Dividends paid*Annually
Capital gains paid*Annually

*If any.

Fund identifiers
NASDAQDGGAX
CUSIP246118541
Investment minimums
Initial investment$1,000
Subsequent Investments$100
Systematic withdrawal balance$5,000
Account features
CheckwritingNo
Payroll DeductionYes
IRAsYes

The performance quoted represents past performance and does not guarantee future results. Investment return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted.

Total returns may reflect waivers and/or expense reimbursements by the manager and/or distributor for some or all of the periods shown. Performance would have been lower without such waivers and reimbursements.

Average annual total return as of month-end (03/31/2014)
YTD1 year3 year5 year10 yearLifetimeInception date
NAV (view definition)-1.34%15.46%10.29%21.07%n/a20.14%12/29/2008
Max offer pricen/a8.81%8.14%19.65%n/a18.79%
MSCI World Index (Gross)1.40%19.72%10.86%18.94%n/an/a
MSCI World Index (Net)1.26%19.07%10.23%18.28%n/an/a
Average annual total return as of quarter-end (03/31/2014)
QTDYTD1 year3 year5 year10 yearLifetimeInception date
NAV (view definition)-1.34%-1.34%15.46%10.29%21.07%n/a20.14%12/29/2008
Max offer price-7.00%-7.00%8.81%8.14%19.65%n/a18.79%
MSCI World Index (Gross)1.40%1.40%19.72%10.86%18.94%n/an/a
MSCI World Index (Net)1.26%1.26%19.07%10.23%18.28%n/an/a

Returns for less than one year are not annualized.

Class A shares have a maximum up-front sales charge of 5.75% and are subject to an annual distribution fee.

Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.

Prior to Dec. 29, 2010, the Fund had not engaged in a broad distribution of its shares and had been subject to limited redemption requests. The returns reflect expense limitations that were in effect during certain periods and that may have been lower than the Fund's current expenses. The returns would have been lower without the expense limitations.

Expense ratio
Gross1.51%
Net1.51%
Quarterly total returns @ NAV
Year1st quarter2nd quarter3rd quarter4th quarterAnnual return
2014-1.34%n/an/an/an/a
20135.38%-1.60%10.56%7.58%23.33%
201216.54%-6.50%5.40%2.37%17.57%
20114.13%3.42%-15.41%7.21%-2.34%
20104.40%-8.51%18.42%8.25%22.44%
2009-0.46%21.59%15.55%8.24%51.36%
Portfolio characteristics - as of 03/31/2014
Share assets$48.7 million
Number of holdings38
Market cap (median)$21.90 billion
Market cap (weighted average)$62.43 billion
Portfolio turnover (last fiscal year)36%
P/E ratio (weighted average trailing 12 months) (view definition)28.17x
Beta (relative to MSCI World Index (Gross)) (view definition)1.03
Annualized standard deviation, 3 years (view definition)15.14
Portfolio composition as of 03/31/2014Total may not equal 100% due to rounding.
Domestic equities53.0%
International equities & depository receipts44.4%
Cash and cash equivalents2.6%
Top 10 holdings as of 03/31/2014
Holdings are as of the date indicated and subject to change.
List excludes cash and cash equivalents.
Holding% of portfolio
priceline.com Inc.3.9%
QUALCOMM Inc.3.7%
MasterCard Inc.3.6%
Microsoft Corp.3.4%
Core Laboratories NV3.3%
Celgene Corp.3.2%
VeriFone Systems Inc.3.2%
eBay Inc.3.1%
EOG Resources Inc.3.1%
Google Inc.3.1%
Total % Portfolio in Top 10 holdings33.6%

Holdings are as of the date indicated and subject to change.

Top 10 countries as of 03/31/2014List excludes cash and cash equivalents.
Country% of portfolio
United States53.0%
United Kingdom14.7%
Japan6.5%
Switzerland4.8%
Brazil4.1%
Denmark2.7%
France2.6%
Spain2.4%
India2.3%
Finland2.2%
Distribution history - annual distributions (Class A)
Distributions ($ per share)
YearCapital gainsDividends
20140.0000.000
20130.3230.000
20120.0000.000
20110.1110.000
20100.4060.028
20091.1700.027
20080.0000.000
20070.0000.000
20060.0000.000
20050.0000.000
20040.0000.000
Greg Heywood

Gregory M. Heywood, CFA

Portfolio Manager, Equity Analyst

Start date on the Fund: December 2008

(View bio)


Patrick Fortier

Patrick G. Fortier, CFA

Portfolio Manager, Equity Analyst

Start date on the Fund: December 2008

(View bio)


Chris Bonavico

Christopher J. Bonavico, CFA

Senior Portfolio Manager, Equity Analyst

Start date on the Fund: December 2008

(View bio)


You may qualify for sales-charge discounts if you and your family invest, or agree to invest in the future, at least $50,000 in Delaware Investments® Funds. More information about these and other discounts is available from your financial advisor, in the Fund's prospectus under the section entitled "About your account," and in the Fund's statement of additional information (SAI) under the section entitled "Purchasing Shares."

The table below describes the fees and expenses that you may pay if you buy and hold shares of the Fund.

Shareholder fees
Maximum sales charge (load) imposed on purchases as a percentage of offering price5.75%
Maximum contingent deferred sales charge (load) as a percentage of original purchase price or redemption price, whichever is lowernone
Annual fund operating expenses
Management fees0.85%
Distribution and service (12b-1) fees0.25%
Other expenses0.41%
Total annual fund operating expenses1.51%
Fee waivers and expense reimbursementsnone
Total annual fund operating expenses after fee waivers and expense reimbursements1.51%

1The Fund's investment manager, Delaware Management Company (Manager), has contractually agreed to waive all or a portion of its investment advisory fees and/or pay/reimburse expenses (excluding any 12b-1 fees, taxes, interest, short sale and dividend interest expenses, brokerage fees, certain insurance costs, acquired fund fees and expenses, and nonroutine expenses or costs, including, but not limited to, those relating to reorganizations, litigation, conducting shareholder meetings, and liquidations) in order to prevent annual fund operating expenses from exceeding 1.30% of the Fund's average daily net assets from March 28, 2014 through March 30, 2015. This waiver and/or reimbursement may only be terminated by agreement of the Manager and the Fund.

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Delaware Focus Global Growth Fund Quarterly commentary December 31, 2013 Class A (DGGAX)

Within the Fund

For the fourth quarter of 2013, Delaware Focus Global Growth Fund (Class A shares at net asset value) posted a positive return but underperformed its benchmark, the MSCI World Index (net). Strong relative performance in the consumer discretionary and financials sectors was partially offset by weak relative performance in the industrials and telecommunication services sectors.

MasterCard was a strong contributor to performance during the quarter. The company recently raised its quarterly dividend, launched an additional share buyback program, and continued to make progress in international growth. As one of the leaders in the electronic payment network, MasterCard is well positioned to benefit from the secular global trend of payment transactions moving from paper-based currency to electronic transactions. Furthermore, MasterCard has shown in recent years that despite a more difficult consumer spending environment, the company’s flexible business model is somewhat buffered by swings in economic cycles and can potentially grow its profitability even in difficult periods.

Japan Exchange Group was also a contributor to performance during the quarter. The trading exchange continued to benefit from a strong Japanese market, and from the prospect of improving financial innovation and activity in Japan. While the trading exchange will likely be helped by a strong Japanese market, it is important to note that we became interested in the company based mainly on its merger with the Osaka Exchange, which we feel should generate revenue and cost synergies for the foreseeable future.

IntercontinentalExchange was a contributor to performance during the quarter. The stock climbed during the period as the company reported strong financial results that beat consensus estimates as well as completed the anticipated acquisition of NYSE Euronext. This latest acquisition makes the company the third largest exchange group globally, and we feel this will be accretive to shareholder value over the long term. Additionally, we continue to believe in the long-term secular growth of the company that should benefit from the increasing demand for trading transparency, both from market participants and from legislators.

Teradata, a mid-sized database software company that specializes in aggregating data for business analytics and decision-making, detracted from performance during the fourth quarter. The stock declined as the company warned, and ultimately reported, third quarter results lower than initial consensus estimates as well as cut its full-year outlook based on weaker-than-expected sales outside the United States and Europe. Additionally, while there is growing investor concern regarding increasing pressure from several companies attempting to compete in Teradata’s core markets, we believe the database warehousing market is large and growing and can accommodate several competitors. We believe these concerns are relatively transitory as Teradata continues to sign up new clients and grow its existing client business. Additionally, the company continues to benefit from the market's overall favorable view of the cloud computing and business analytics industry, and we believe the company is well-positioned in a technology spending environment that is focused on making technology buys with a definable return on investment.

BM&F Bovespa was also a detractor from Fund performance during the quarter. The company reported financial results that somewhat missed consensus estimates due to higher operating expenses. In addition, as the key trading exchange in the Brazilian financial markets, the company is often considered by investors to be a proxy for the health and outlook for the Brazilian market in general. While we don’t believe shifts in investor sentiment on Brazil should have much effect on the company’s operating fundamentals, we acknowledge there could be a certain amount of stock volatility as a result. We continue to believe the company fundamentals should ultimately outweigh short-term shifts in investor sentiment.

Finally, Experian detracted from performance during the quarter. The market did not react favorably to the suspension of its share buyback program after agreeing to acquire a U.S. healthcare data firm. While investors grew concerned regarding the company’s rate of organic growth and M&A strategy going forward, we feel that its acquisition strategy could ultimately prove accretive to shareholder value.

Outlook

Despite positive absolute returns in the equity market during the past few years, we believe the many short-term swings in market sentiment demonstrate that there are more than just fundamental factors affecting stock prices. Rather, recent equity market volatility suggests to us that many investors appear to be struggling with accurately predicting the pace of global economic recovery and are assessing factors that threaten economic fundamentals (for example, central bank actions and fiscal policy debates across the globe). While some fundamentals in various geographies may be trending in a positive direction (from a very low base during the global financial crisis in 2008-2009), we don’t believe we are entering into a typical post-recessionary global boom cycle. Rather, we believe the lingering effects of the credit crisis years ago could lead to moderate growth, at best. In such a tenuous environment, we believe the quality of a company’s business model, competitive position, and management may prove to be of utmost importance.

Regardless of the economic outcome, we remain consistent in our long-term investment philosophy: We want to own what we view as strong secular-growth companies with solid business models and competitive positions that we believe can grow market share and have the potential to deliver shareholder value in a variety of market environments.

[11934]

The views expressed represent the Manager's assessment of the Fund and market environment as of the date indicated, and should not be considered a recommendation to buy, hold, or sell any security, and should not be relied on as research or investment advice. Information is as of the date indicated and subject to change.

Document must be used in its entirety.

Carefully consider the Fund’s investment objectives, risk factors, charges, and expenses before investing. This and other information can be found in the Fund’s prospectus and its summary prospectus, which may be obtained by clicking the prospectus link located in the right-hand sidebar or calling 800 523-1918. Investors should read the prospectus and the summary prospectus carefully before investing.

Investing involves risk, including the possible loss of principal.

Investments in small and/or medium-sized companies typically exhibit greater risk and higher volatility than larger, more established companies.

International investments entail risks not ordinarily associated with U.S. investments including fluctuation in currency values, differences in accounting principles, or economic or political instability in other nations.

Investing in emerging markets can be riskier than investing in established foreign markets due to increased volatility and lower trading volume.

Not FDIC Insured | No Bank Guarantee | May Lose Value

Fund Finder

Daily pricing (as of 04/15/2014)

Class APriceNet changeYTD
NAV$18.680.04-3.66%
Max offer price$19.82n/an/a

Total net assets (as of 03/31/2014)

$123.2 million all share classes

Overall Morningstar RatingTM

Load waived

With load

Class A shares (as of 03/31/2014)

Load waivedWith loadNo. of funds
Overall43804
3 Yrs32804
5 Yrs44642
Morningstar categoryWorld Stock

(View Morningstar disclosure)

Lipper ranking (as of 03/31/2014)

YTD ranking204 / 236
1 year181 / 226
3 years62 / 179
5 years23 / 124
10 yearsn/a
Lipper classificationGlobal Multi-Cap Growth

(View Lipper disclosure)

Literature

Prospectuses and reports

Benchmark, peer group

MSCI World Index (view)

Lipper Global Multi-Cap Growth Funds Average (view)

Additional information