years. Comparisons of returns to relevant in- dexes, in this case, the S&P 500 and the Wilshire top 750 indexes, are provided to serve as benchmarks in evaluating the performance of the fund. The values under these columns give the performance of the fund relative to the index. For example, Magellans return was 0.20% below the S&P 500 over the last three months, but 1.69% per year better than the S&P over the past 15 years. The returns reported for the fund are calculated net of ex- penses, 12b-1 fees, and any other fees automatically deducted from fund assets, but they do not account for any sales charges such as front-end loads or back-end charges. Next appear the percentile ranks of the fund compared to all other funds (see column headed by "All") and to all funds with the same investment objective (see column headed by "Obj"). A rank of 1 means the fund is a top performer. A rank of 80 would mean that it was beaten by 80% of funds in the comparison group. You can see from the table that Magellan has had an ex- cellent year compared to other growth and income funds, as well as excellent longer-term performance. For example, over the past five years, its average return was higher than all but 8% of the funds in its category. Finally, growth of $10,000 invested in the fund over various periods ranging from the past three months to the past 15 years is given in the last column. More data on the performance of the fund are provided in the graph at the top right of the figure. The bar charts give the funds rate of return for each quarter of the last 10 years. Below the graph is a box for each year that depicts the relative performance of the fund for that year. The shaded area on the box shows the quartile in which the funds performance falls relative to other funds with the same objective. If the shaded band is at the top of the box, the firm was a top quartile performer in that period, and so on. The table below the bar charts presents historical data on characteristics of the fund. These data include return, return relative to appropriate benchmark indexes such as the S&P 500, the component of returns due to income (dividends) or capital gains, the percentile rank of the fund compared to all funds and funds in its objective class (where, again, 1% is the best performer and 99% would mean that the fund was outperformed by 99% of its comparison group), the expense ratio, and turnover rate of the portfolio. The table on the right entitled "Portfolio Analysis" presents the 25 largest holdings of the portfolio, showing the price-earning ratio and year-to-date return of each of those se- curities. Investors can thus get a quick look at the managers biggest bets. Below the portfolio analysis is a box labeled "Investment Style." In this box, Morn- ingstar evaluates style along two dimensions: One dimension is the size of the firms held in the portfolio as measured by the market value of outstanding equity; the other dimension is a value/growth continuum. Morningstar defines value stocks as those with low ratios of market price per share to earnings per share or book value per share. These are called value stocks because they have a low price relative to these two measures of value. In contrast, growth stocks have high ratios, suggesting that investors in these firms must believe that the firm will experience rapid growth to justify the prices at which the stocks sell. The shaded box for Magellan shows that the portfolio tends to hold larger firms (top row) and blend stocks (middle column). A year-by-year history of Magellans investment style is presented in the sequence of such boxes at the top of the figure. I. Introduction 4. Mutual Funds and Other