Growth Fund

Overview

Objective

Seeks capital appreciation.

Strategy

Primarily focuses on the stocks of companies that have shown and are expected to show above-average growth in earnings.

The Management Team

The Fund is managed by the Equity Strategy Team, a group of senior-level investment professionals who average 31 years of experience.

Risk/Return

LOW - - - - - • - HIGH

In general, greater returns are associated with greater risks.

Fund Statistics

Inception Date 12/12/94
Ticker Symbol CFGRX
Cusip 200626406
Minimum Initial Investment $1,000

Commentary

Following the sharp selloff in the fourth quarter of 2018, the Russell 1000 Growth Index index rallied back in the first quarter 2019, recovering all but 2.4% of the loss. We believe the rally was fueled in part by the Federal Reserve (Fed) backing off from further interest rate hikes along with more optimistic US-China trade headlines. The Commerce Growth Fund finished the quarter up 15.08%, underperforming the Russell 1000 Growth Index return of 16.10%.

Stock selection detracted from the Fund’s relative performance. The weakest stocks were CBOE Global Markets (0.96%), RPM International Inc. (0.99%), and Service Corporation International (0.99%), returning -2.1%, -0.6%, and 0.2%, respectively. The Fund’s strongest stocks were Armstrong World Industries (1.03%), Bio-Techne Corporation (0.00%), and FleetCor Technologies (1.01%), up 36.8%, 33.1%, and 32.8% respectively.

The Fund’s sector allocations also detracted from the Fund’s relative performance. The Fund’s 3% underweight to the Electronic Technology sector (up 22%) hurt the Fund’s performance. However, the Fund’s 1.3% underweight to the Consumer Durables sector (only up 3.9%), helped the Fund’s performance.

During the quarter the Fund increased its position in the Technology Services sector from 24.1% to 25.3%, with the purchase of Citrix Systems, Inc. (0.97%) which reduced the Fund’s underweight to the sector. The Fund decreased its position in the Health Services sector from 3.7% to 2.5% through the sale of HCA Healthcare Inc. (0.00%), creating the Fund’s underweight to the sector.

Total Fund Assets as of 3/31/2019 $144,503,178
Net Asset Value1 $33.74
Asset Allocation  
Equities 99.8%
Cash 0.2%
Weighted Average Market Capitalization 242.9 Billion

Holdings

Top Ten Equity Holdings2 as of 3/31/2019

Apple Inc 5.5%
Microsoft Corporation 5.4%
Amazon.com, Inc 4.4%
Alphabet Inc, Class A 4.3%
Facebook, Inc 2.2%
Visa Inc. 1.7%
UnitedHealth Group Inc. 1.5%
Home Depot, Inc 1.4%
Intercontinental Exchange, Inc. 1.3%
United Parcel Service, Inc, Class B 1.2%

Footnotes:
1. The Net Asset Value represents the assets of the fund (ex dividend) by the total number of shares.
2. The composition of the portfolio is subject to change in the future.
3. The Russell 1000 Growth Index is an unmanaged index that measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values. The Index figures do not reflect any fees or expenses.

Portfolio Holdings

The Fund invests in mid-capitalization securities. The securities of mid-capitalization companies involve greater risks than those associated with larger, more established companies and may be subject to more abrupt or erratic price movements.

Holdings and allocations shown are unaudited, and may not be representative of current or future investments. Holdings and allocations may not include the Fund's entire investment portfolio, which may change at any time. Fund holdings should not be relied on in making investment decisions and should not be construed as research or investment advice regarding particular securities.

Commerce Growth Holdings

March 2019*
April 2019*
May 2019*

A prospectus for the Commerce Funds containing more complete information may be obtained by calling 1-800-995-6365 or by downloading it from this website. Please consider a Fund's objectives, risks, and charges and expenses, and read the prospectus carefully before investing. The prospectus contains this and other information about the Fund.

The mutual funds referred to in this Web site are offered and sold only to persons residing in the United States and are offered by prospectus only. The prospectus contains more complete information about the funds, including charges and expenses, and should be read carefully before investing.