Equity Options

Blended Equity Option

CollegeAdvantage offers an all-equity blended investment option that invests in more than one underlying mutual fund, offering diversification within an all-stock option. This blended fund holds a mix of growth and value, U.S. and international stocks.

Vanguard Aggressive Growth Index Portfolio (Blended U.S. and International)

The Vanguard Aggressive Growth Index Portfolio invests all of its assets in two Vanguard stock index funds. The percentages of the portfolio’s assets allocated to each Vanguard underlying fund are:

Vanguard Total Stock Market Index Fund	80%
Vanguard Developed Market Index Fund	20%
TOTAL EQUITY FUNDS	100%

 

Through its ownership of these Vanguard underlying funds, the Vanguard Aggressive Growth Index Portfolio indirectly owns primarily large-capitalization U.S. stocks and, to a lesser extent, small- and mid-capitalization U.S. stocks and international stocks.

Large-Cap Equity Options

CollegeAdvantage offers three large-cap options. Large-cap funds seek to provide long-term growth potential and current income by investing in the stocks of large companies -- those with market capitalizations generally above $8 billion.

Large-cap funds tend to be less volatile than funds invested in smaller-sized companies.

Vanguard 500 Index Option (U.S. Large-Cap Equity)

The Vanguard 500 Index Option invests in the Vanguard Institutional Index Fund, which seeks to track the performance of the Standard & Poor’s 500 Index. The index is dominated by the stocks of large U.S. companies.

The fund attempts to replicate the target index by investing all or substantially all of its assets in the stocks that make up the index.
(Will link to FAQ or glossary item)

Vanguard Windsor II Option (U.S. Large-Cap Equity Value)

The Vanguard Windsor II Option invests in the Vanguard Windsor II Fund, which invests mainly in large- and mid-capitalization companies whose stocks are considered by an advisor to be undervalued. Undervalued stocks are generally those that are out of favor with investors and the advisor feels are trading at prices that are below average in relation to such measures as earnings and book value.

These stocks often have above-average dividend yields. The fund is actively managed and uses multiple investment advisors.

Vanguard Morgan Growth Option (U.S. Large-Cap Equity Growth)

The Vanguard Morgan Growth Option invests in the Vanguard Morgan Growth Fund, which invests mainly in the stocks of mid- and large-capitalization U.S. companies whose revenues and/or earnings are expected to grow faster than those of the average company in the market.

The fund is actively managed and uses multiple investment advisors.

Small- to Mid-Cap Equity Options

CollegeAdvantage offers two small- to mid-cap stock options.

Small-cap refers to stocks with a relatively small market capitalization, generally companies with a market capitalization of between $300 million and $2 billion.

Mid-cap companies generally have a market capitalization of more than $2 billion and less than $10 billion.

Vanguard Extended Market Index Option (U.S. Small- and Mid-Cap Equity)

The Vanguard Extended Market Index Option invests in the Vanguard Extended Market Index Fund, which seeks to track the performance of the S&P Completion Index, a broadly diversified index of stocks of small- and medium-size U.S. companies. The Fund invests all, or substantially all, of its assets in stocks of its target index, with nearly 80% of its assets invested in the 1,200 largest stocks in its target index (covering nearly 80% of the index’s total market capitalization) and the rest of its assets in a representative sample of the remaining stocks. The Fund holds a range of securities that, in the aggregate, approximates the full index in terms of key characteristics. These key characteristics include industry weightings and market capitalization, as well as certain financial measures, such as price-earnings ratio and dividend yield.

Oppenheimer Main Street Small Cap Option (U.S. Small-Cap Equity Blend)

The Oppenheimer Main Street Small Cap Option invests in the Oppenheimer Main Street Small Cap Fund,® which mainly invests in common stocks of small capitalization U.S. companies, based on analysis using approximately 3,000 stocks on a daily basis. The Fund seeks capital appreciation and is designed primarily for investors seeking capital appreciation over the long term. Under normal market conditions, the Fund will invest at least 80% of its net assets in securities of companies having a small market capitalization. The Fund defines small capitalization as companies with market capitalizations less than or equal to the largest company in the Russell 2000 or the S&P Small Cap 600 index. The capitalization of the largest company in the Russell 2000 or S&P 600 Small Cap index is currently $3.7 billion.

International Equity Options

CollegeAdvantage offers two international stock options which invest primarily in stocks of companies located
outside of the United States.

Vanguard Developed Markets International Stock Index Option (International Equity)

The Vanguard Developed Markets International Stock Index Option invests in the Vanguard Developed Markets Index Fund. The Fund is designed to track the performance of the Morgan Stanley Capital International Europe, Australasia, Far East (MSCI EAFE) Index, which measures the investment return of stocks issued by companies
located in the major markets of Europe and the Pacific region. The Fund invests in two other Vanguard funds
— Vanguard European Stock Index Fund and Vanguard Pacific Stock Index Fund — whose benchmarks together make up the MSCI EAFE Index. The Fund allocates its assets between these two funds, based on the market capitalizations of European and Pacific stocks in the MSCI EAFE Index. The Index includes approximately 1,020 common stocks of companies located in Europe, Australia, Asia and the Far East.

GE Institutional International Equity Option (International Equity)

The GE Institutional International Equity Option invests in the GE Institutional International Equity Fund, which invests primarily in companies in developed and developing countries outside the United States. The portfolio managers focus on companies that they expect will grow faster than relevant markets and whose security prices do not fully reflect their potential for growth. Under normal circumstances, the Fund’s assets are invested in foreign securities of companies representing at least three different countries. Stock selection is key to the performance of the Fund. Portfolio managers seek to identify securities of growth companies with characteristics such as low valuation relative to their long-term cash earnings growth potential, potential for significant improvement in the company’s business, financial strength and sufficient liquidity. The Fund also may invest to a lesser extent in debt securities and may invest in securities of companies
located in the United States.