Short-Term Government Securities Fund

Bond Funds

Investment Objective and Strategy

Is This Fund a Good Choice for Me?
The Short-Term Government Securities Fund may be appropriate if you’re seeking a little more interest income from your savings than you’d earn in a traditional savings account. You’re also comfortable with potential fluctuations in your account based on the performance of the underlying bonds.

Investment Objective and Strategy
The fund seeks a high level of current income from investments in securities backed by the full faith and credit of the U.S. government. These investments include: U.S. Treasuries, securities issued by U.S. government agencies, and other securities whose principal and interest payments are guaranteed by the U.S. government. The average maturity of the portfolio, under normal circumstances, is expected to be three years or less.

Fund Profile
Inception May 01, 1995
Asset Allocation Bond
Benchmark ICE BofA ML 1-5 Year U.S. Treasury Index
Ticker Symbol HOSGX
CUSIP Number 437769409
Industry Rankings as of 09/30/2019

Morningstar

Category: Short Government

★★★

Overall, out of 96 funds, according to risk adjusted return

Lipper

Classification: Short U.S. Government

5

preservation

Overall, out of 5,874 funds, according to historical loss avoidance

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Lipper ratings for Preservation reflect the Fund’s historical loss avoidance relative to other funds within the same asset class, as of 9/30/19. The Lipper ratings are subject to change every month and are based on an equal-weighted average of percentile ranks for the Preservation metrics over three-, five-, 10-year and Overall periods. The highest 20% of funds in each peer group are named Lipper Leader or a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20 are scored 1. Homestead Short-Term Government Securities Fund, in Lipper’s Short US Government Funds classification, received a rating of 5 for the three-, five-, 10-year and Overall periods (number of funds rated in parentheses): Preservation: Three Year (5,874 funds), Five Year (5,116 funds), 10 Year (3,308 funds) and Overall (5,874 funds). Lipper ratings are not intended to predict future results, and Lipper does not guarantee the accuracy of this information. More information is available at lipperleaders.com.

Morningstar rated this Fund, in Morningstar’s short government category, 3 stars for the Overall period out of 96 funds, 3 stars for the 10-year period out of 70 funds, 3 stars for the five-year period out of 93 funds and 3 stars for the three-year period out of 96 funds for performance periods ending 9/30/19. The Morningstar Rating for funds, or “star rating”, is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product’s monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

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Costs
Fee Structure No Load
Expense Ratio 0.82% (Net 0.75%) (12/31/2018)
Median Expense Ratio for Peer Group 0.91% (12/31/2018)
Fee Waiver Contractual through 5/1/2020
Transaction Fees NONE
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The expense ratio shows the percentage of fund assets deducted annually to cover operating costs. Fund expense ratios shown here do not include acquired fund fees and expenses. If applicable, these additional costs are disclosed in the prospectus. The net expense ratio is the expense ratio minus the portion of expenses waived or reimbursed. Please see the current prospectus for additional details.

RE Advisers has contractually agreed, through at least May 1, 2020, to limit the Fund’s operating expenses to an amount not to exceed 0.75%. This waiver agreement will terminate immediately upon termination of the Fund’s Management Agreement and may be terminated by the Fund or RE Advisers with one year’s notice.

Portfolio Management

Debt securities are subject to interest rate risk, credit risk, extension risk, income risk, issuer risk and market risk. The value of U.S. government securities can decrease due to changes in interest rates or changes to the financial condition or credit rating of the U.S. government. Investments in asset-backed and mortgage-backed securities are also subject to prepayment risk as well as increased susceptibility to adverse economic developments. High-yield, lower-rated securities involve greater risk than higher-rated securities.

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