N-CSRS 1 dgi_ncsrs.htm N-CSRS

united states
securities and exchange commission
washington, d.c. 20549

form n-csr

certified shareholder report of registered management
investment companies

Investment Company Act file number 333-252816 and 811-23637

 

DGI Investment Trust

(Exact name of registrant as specified in charter)

 

c/o Oriental Trust, 254 Munoz Rivera Ave., 10th Floor, San Juan Puerto Rico 00918__

(Address of principal executive offices) (Zip code)

 

Maggie Bull, Ultimus Fund Solutions LLC

2 Easton Oval, Suite 300, Columbus OH 43219

(Name and address of agent for service)

 

Registrant's telephone number, including area code: 513-869-4262

 

Date of fiscal year end: 6/30

 

Date of reporting period: 12/31/23

 

Item 1. Reports to Stockholders.

 

(a)       Include a copy of the report transmitted to stockholders pursuant to Rule 30e-1 under the Act (17 CFR 270.30e-1).

 

 
 
 
 
 
 
 
 
 
 
(ORIENTAL LOGO)
 
 
 
 
 
DGI Balanced Fund
 
 
 
 
 
Semi-Annual Report
December 31, 2023
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
This report and the financial statements contained herein are submitted for the general information of shareholders and are not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus, which contains information about the Fund’s investment objective, risks, fees and expenses. Investors are reminded to read the prospectus carefully before investing in the Fund.

 

 

DGI Balanced Fund
PORTFOLIO REVIEW (Unaudited)
December 31, 2023

 

The Fund’s performance figures* for the periods ended December 31, 2023, compared to its benchmarks:

 

      Annualized
  Six Months One Year Since Inception(a) Since Inception(b)
DGI Balanced Fund - Class A Shares N/A N/A 4.11% N/A
DGI Balanced Fund - Class A Shares with Load ** N/A N/A 0.46% N/A
DGI Balanced Fund - Class C Shares N/A N/A 4.11% N/A
DGI Balanced Fund - Class I Shares N/A N/A 4.21% N/A
DGI Balanced Fund - Class P Shares 7.25% 11.68% N/A (0.88)%
DGI Balanced Fund - Class T Shares 7.25% 11.68% N/A (0.88)%
DGI Balanced Fund - Class NT Shares 7.25% 11.68% N/A (0.88)%
Blended Benchmark Index (67% Bloomberg U.S. Aggregate Bond Index /33% S&P 500 Total Return Index) 4.93% 12.09% 3.16% 0.57%
Bloomberg U.S. Aggregate Bond Index *** 3.37% 5.53% 2.28% (2.81)%
S&P 500 Total Return Index **** 8.04% 26.29% 4.95% 7.10%

 

(a)Inception date for Class A, Class C, and Class I shares is December 6, 2023.

 

(b)Inception date for Class P, Class T, and Class NT shares is May 23, 2021.

 

*The performance data quoted is historical. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. The principal value and investment return of an investment will fluctuate so that your shares, when redeemed, may be worth more or less than their original cost. Total Returns for periods of less than one year are not annualized. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or on the redemptions of Fund shares. The estimated total annual operating expense ratio is 1.64%, 2.39%, 1.39%, 1.39%, 1.39%, and 1.39% for Class A, Class C, Class I, Class P, Class T, and Class NT shares, respectively, per the Fund’s Prospectus dated October 27, 2023. For performance information current to the most recent month-end, please call 1-877-910-4232.

 

**Class A with Load total return is calculated using the maximum sales charge of 3.50%.

 

***The Bloomberg U.S. Aggregate Bond Index is a broad-based flagship benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market. The index includes Treasuries, government-related and corporate securities, Mortgage-Backed Securities (agency fixed-rate pass-throughs), Asset-Backed Securities and Commercial Mortgage-Backed Securities (agency and non-agency). Investors cannot invest directly into an index. Index returns are gross of any fees, brokerage commissions or other expenses of investing.

 

****The S&P 500 Total Return Index is a widely accepted, unmanaged index of U.S. stock market performance which does not take into account charges, fees and other expenses. Investors cannot invest directly in an index. Index returns are gross of any fees, brokerage commissions or other expenses of investing.

 

Holdings by Type of Investment  % of Net Assets 
U.S. Government Agencies   40.5%
Exchange Traded Funds   43.6%
Common Stocks   9.1%
Short-Term Investment   6.1%
Collateralized Mortgage Obligations   0.0%
Other Assets in Excess of Liabilities   0.7%
    100.0%

 

*Percentage rounds to less than 0.1%

 

Please refer to the Schedule of Investments that follows in this semi-annual report for a detail of the Fund’s holdings.

1

 

DGI BALANCED FUND
SCHEDULE OF INVESTMENTS (Unaudited)
December 31, 2023

 

Shares      Fair Value 
     COMMON STOCKS — 9.1%     
     BANKING - 9.1%     
 500,000   First BanCorporation  $8,225,000 
 235,000   Popular, Inc.   19,286,450 
     TOTAL COMMON STOCKS (Cost $16,037,199)   27,511,450 
           
     EXCHANGE-TRADED FUNDS — 43.6%     
     EQUITY - 43.6%     
 139,300   iShares MSCI EAFE ETF   10,496,255 
 160,000   iShares MSCI Emerging Markets ETF   6,433,600 
 48,000   iShares MSCI India ETF   2,342,880 
 199,000   iShares Russell 2000 ETF   39,941,290 
 113,400   SPDR S&P 500 ETF Trust   53,900,154 
 201,000   Vanguard FTSE Emerging Markets ETF   8,261,100 
 156,000   Vanguard MSCI Europe ETF   10,058,880 
     TOTAL EXCHANGE-TRADED FUNDS (Cost $113,914,545)   131,434,159 

 

Principal         Coupon Rate       
Amount ($)      Spread  (%)  Maturity    
     COLLATERALIZED MORTGAGE OBLIGATIONS — 0.0%(a)              
 864,478   Federal National Mortgage Association Series 2001-M1 X (b),(c)  SOFR30A + 5.886%  0.5481  07/25/38   80,532 
     TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS (Cost $55,255)              
                    
     U.S. GOVERNMENT & AGENCIES — 40.5%              
     FEDERAL HOME LOAN MORTGAGE CORP. 1.6%(d)              
 186,797   Federal Home Loan Mortgage Corporation Series D97349     6.0000  09/01/25   190,053 
 9,949   Federal Home Loan Mortgage Corporation Series D75702     7.5000  01/01/26   9,983 
 20,996   Federal Home Loan Mortgage Corporation Series D79168     8.0000  02/01/27   21,005 

 

See accompanying notes to financials.

2

 

DGI BALANCED FUND
SCHEDULE OF INVESTMENTS (Unaudited) (Continued)
December 31, 2023

 

Principal      Coupon Rate       
Amount ($)      (%)  Maturity  Fair Value 
     U.S. GOVERNMENT & AGENCIES — 40.5% (Continued)           
     FEDERAL HOME LOAN MORTGAGE CORP. 1.6%(d) (Continued)           
 502,659   Federal Home Loan Mortgage Corporation Series J20654  3.0000  08/01/27  $482,196 
 46,364   Federal Home Loan Mortgage Corporation Series C10178  6.5000  05/01/28   48,577 
 144,389   Federal Home Loan Mortgage Corporation Series P51380  5.5000  03/01/36   144,105 
 152,548   Federal Home Loan Mortgage Corporation Series C02554  6.0000  06/01/36   159,296 
 4,103,730   Federal Home Loan Mortgage Corporation Series SB0645  2.0000  12/01/36   3,686,134 
               4,741,349 
     FEDERAL NATIONAL MORTGAGE ASSOCIATION 10.0%(d)           
 3,044   Federal National Mortgage Association Series 426648  7.0000  04/01/24   3,034 
 3,917   Federal National Mortgage Association Series 426646  8.0000  10/01/24   3,907 
 3,157   Federal National Mortgage Association Series 426645  8.5000  10/01/24   3,148 
 52,437   Federal National Mortgage Association Series 426651  6.5000  03/01/26   54,311 
 6,448   Federal National Mortgage Association Series 511569  8.5000  07/01/26   6,432 
 97,447   Federal National Mortgage Association Series AE1268  3.5000  10/01/26   94,690 
 14,981   Federal National Mortgage Association Series 367023  7.5000  11/01/26   14,972 
 170,058   Federal National Mortgage Association Series AE1285  3.5000  12/01/26   165,082 
 22,630   Federal National Mortgage Association Series 367025  8.0000  12/01/26   22,608 
 482,339   Federal National Mortgage Association Series AJ1905  3.0000  02/01/27   462,695 
 59,616   Federal National Mortgage Association Series 426649  7.0000  02/01/27   61,541 
 203,726   Federal National Mortgage Association Series AI9096  3.5000  03/01/27   196,801 
 7,687   Federal National Mortgage Association Series 374925  7.5000  03/01/27   7,684 
 341,351   Federal National Mortgage Association Series AL3274  3.0000  05/01/27   331,278 
 256,121   Federal National Mortgage Association Series AJ1913  3.0000  06/01/27   245,286 
 6,045   Federal National Mortgage Association Series 426647  7.5000  06/01/27   6,043 
 974,621   Federal National Mortgage Association Series AP1217  2.5000  07/01/27   938,545 
 407,304   Federal National Mortgage Association Series AI9133  3.5000  11/01/27   393,022 
 778,296   Federal National Mortgage Association Series AR5151  2.5000  04/01/28   747,589 
 82,028   Federal National Mortgage Association Series AU2244  3.0000  09/01/28   78,287 
 896,167   Federal National Mortgage Association Series AR5202  3.0000  11/01/28   856,111 
 520,057   Federal National Mortgage Association Series AR5223  3.0000  02/01/29   502,152 
 632,978   Federal National Mortgage Association Series AS2542  3.0000  04/01/29   601,956 
 374,388   Federal National Mortgage Association Series AS2465  3.0000  04/01/29   356,032 
 57,115   Federal National Mortgage Association Series 488061  7.0000  04/01/29   58,959 
 559,845   Federal National Mortgage Association Series AV6988  3.0000  05/01/29   540,546 
 1,217,440   Federal National Mortgage Association Series AV1451  3.0000  06/01/29   1,173,928 

 

See accompanying notes to financials.

3

 

DGI BALANCED FUND
SCHEDULE OF INVESTMENTS (Unaudited) (Continued)
December 31, 2023

 

Principal      Coupon Rate       
Amount ($)      (%)  Maturity  Fair Value 
     U.S. GOVERNMENT & AGENCIES — 40.5% (Continued)           
     FEDERAL NATIONAL MORTGAGE ASSOCIATION 10.0%(d) (Continued)           
 1,158,337   Federal National Mortgage Association Series AV6993  3.0000  06/01/29  $1,116,882 
 1,133,903   Federal National Mortgage Association Series AV6999  3.0000  06/01/29   1,093,304 
 701,673   Federal National Mortgage Association Series AV1452  3.0000  07/01/29   667,312 
 81,688   Federal National Mortgage Association Series 504137  7.5000  07/01/29   82,060 
 36,141   Federal National Mortgage Association Series 504148  7.5000  08/01/29   36,197 
 580,674   Federal National Mortgage Association Series AV7011  3.0000  09/01/29   552,226 
 33,159   Federal National Mortgage Association Series 523120  7.0000  01/01/30   34,229 
 659,697   Federal National Mortgage Association Series AV7045  3.0000  02/01/30   627,356 
 14,648   Federal National Mortgage Association Series 523123  7.5000  02/01/30   14,644 
 152,707   Federal National Mortgage Association Series 567014  6.5000  03/01/31   158,992 
 647,368   Federal National Mortgage Association Series AX5513  3.0000  04/01/31   613,206 
 145,149   Federal National Mortgage Association Series 573448  6.5000  04/01/31   150,898 
 700,652   Federal National Mortgage Association Series AX5544  3.0000  08/01/31   663,745 
 937,210   Federal National Mortgage Association Series AX5551  2.5000  10/01/31   869,731 
 417,154   Federal National Mortgage Association Series AX5567  3.0000  12/01/31   396,896 
 680,457   Federal National Mortgage Association Series BD9019  3.0000  01/01/32   644,512 
 685,675   Federal National Mortgage Association Series 695394  5.0000  06/01/33   697,753 
 185,834   Federal National Mortgage Association Series 850040  6.5000  06/01/36   194,590 
 1,556,675   Federal National Mortgage Association Series CB2736  2.5000  01/01/37   1,432,206 
 89,357   Federal National Mortgage Association Series 931180  5.5000  04/01/39   92,136 
 456,987   Federal National Mortgage Association Series 953131  4.5000  09/01/39   457,088 
 2,329,564   Federal National Mortgage Association Series AI9098  4.0000  03/01/42   2,269,813 
 1,456,001   Federal National Mortgage Association Series AS3545  4.0000  09/01/44   1,406,034 
 1,529,050   Federal National Mortgage Association Series AV7027  4.0000  11/01/44   1,476,576 
 554,329   Federal National Mortgage Association Series AX5471  3.0000  07/01/45   506,040 
 769,084   Federal National Mortgage Association Series AV7076  3.0000  07/01/45   704,236 
 4,391,609   Federal National Mortgage Association Series AS8523  3.0000  11/01/46   3,977,860 
 1,445,536   Federal National Mortgage Association Series AX5564  3.0000  12/01/46   1,309,345 
               30,172,506 
     GOVERNMENT NATIONAL MORTGAGE ASSOCIATION — 28.9%           
 2,035   Government National Mortgage Association Series 406062  7.5000  01/15/25   2,034 
 2,824   Government National Mortgage Association Series 406065  7.5000  01/15/25   2,823 
 5,400   Government National Mortgage Association Series 439194  7.5000  08/15/25   5,398 
 22,171   Government National Mortgage Association Series 425509  8.0000  09/15/25   22,178 

 

See accompanying notes to financials.

4

 

DGI BALANCED FUND
SCHEDULE OF INVESTMENTS (Unaudited) (Continued)
December 31, 2023

 

Principal      Coupon Rate       
Amount ($)      (%)  Maturity  Fair Value 
     U.S. GOVERNMENT & AGENCIES — 40.5% (Continued)           
     GOVERNMENT NATIONAL MORTGAGE ASSOCIATION — 28.9% (Continued)           
 63,647   Government National Mortgage Association Series 705899  3.5000  01/15/26  $62,183 
 8,926   Government National Mortgage Association Series 385183  7.5000  01/15/26   8,931 
 17,810   Government National Mortgage Association Series 5127  4.0000  07/20/26   17,332 
 190,325   Government National Mortgage Association Series 711631  3.5000  02/15/27   184,607 
 47,903   Government National Mortgage Association Series 5310  3.5000  02/20/27   46,115 
 314,227   Government National Mortgage Association Series 705941  3.0000  04/15/27   302,799 
 157,148   Government National Mortgage Association Series 711651  3.5000  05/15/27   152,434 
 635,667   Government National Mortgage Association Series 740018  3.5000  07/15/27   616,722 
 298,782   Government National Mortgage Association Series 705951  2.5000  08/15/27   285,066 
 609,199   Government National Mortgage Association Series 744440  3.5000  10/15/27   590,862 
 226,625   Government National Mortgage Association Series 705956  2.5000  11/15/27   215,177 
 24,248   Government National Mortgage Association Series 711707  2.5000  01/15/28   23,135 
 180,058   Government National Mortgage Association Series 767026  2.5000  02/15/28   170,967 
 260,547   Government National Mortgage Association Series 721979  2.5000  03/15/28   246,984 
 316,514   Government National Mortgage Association Series 722012  3.0000  09/15/28   302,510 
 254,836   Government National Mortgage Association Series 722016  2.5000  12/15/28   240,954 
 277,126   Government National Mortgage Association Series 722033  3.0000  06/15/29   264,839 
 39,976   Government National Mortgage Association Series 626932  3.0000  04/15/30   37,659 
 88,184   Government National Mortgage Association Series 548539  6.0000  10/15/31   90,982 
 328,599   Government National Mortgage Association Series 635142  3.0000  11/20/31   308,217 
 103,566   Government National Mortgage Association Series 636427  6.0000  11/15/34   106,839 
 54,001   Government National Mortgage Association Series 636567  6.0000  07/15/35   55,305 
 61,694   Government National Mortgage Association Series 643754  6.0000  10/15/35   63,491 
 163,650   Government National Mortgage Association Series 592885  6.0000  05/15/36   168,872 
 1,748,384   Government National Mortgage Association Series 655703  6.0000  08/15/37   1,818,677 
 1,309,517   Government National Mortgage Association Series 722002  3.5000  03/15/38   1,232,944 
 594,902   Government National Mortgage Association Series 767055  3.0000  05/15/38   543,987 
 630,554   Government National Mortgage Association Series 767066  3.0000  06/15/38   576,594 
 2,046,539   Government National Mortgage Association Series 721997  3.5000  01/15/39   1,932,324 
 699,173   Government National Mortgage Association Series 678638  4.5000  08/15/39   699,566 
 540,600   Government National Mortgage Association Series 678639  5.0000  08/15/39   556,217 
 1,662,359   Government National Mortgage Association Series 678641  4.5000  09/15/39   1,663,292 
 122,120   Government National Mortgage Association Series 719894  4.5000  09/15/39   122,189 
 971,029   Government National Mortgage Association Series 678642  5.0000  09/15/39   999,076 

 

See accompanying notes to financials.

5

 

DGI BALANCED FUND
SCHEDULE OF INVESTMENTS (Unaudited) (Continued)
December 31, 2023

 

Principal      Coupon Rate       
Amount ($)      (%)  Maturity  Fair Value 
     U.S. GOVERNMENT & AGENCIES — 40.5% (Continued)           
     GOVERNMENT NATIONAL MORTGAGE ASSOCIATION — 28.9% (Continued)           
 528,633   Government National Mortgage Association Series 678645  4.5000  10/15/39  $528,915 
 429,543   Government National Mortgage Association Series 678646  5.0000  10/15/39   441,952 
 409,600   Government National Mortgage Association Series 678643  5.5000  11/15/39   417,585 
 354,632   Government National Mortgage Association Series 678660  5.0000  03/15/40   364,879 
 406,095   Government National Mortgage Association Series 722009  3.5000  07/15/40   383,120 
 1,607,677   Government National Mortgage Association Series 705892  4.0000  11/15/40   1,589,791 
 357,682   Government National Mortgage Association Series 705894  4.5000  11/15/40   357,883 
 498,312   Government National Mortgage Association Series 705937  4.0000  01/15/42   492,769 
 1,773,656   Government National Mortgage Association Series 705936  3.5000  02/15/42   1,677,976 
 46,827   Government National Mortgage Association Series 5302  3.5000  02/20/42   43,331 
 1,931,146   Government National Mortgage Association Series 711653  3.5000  05/20/42   1,818,624 
 1,734,704   Government National Mortgage Association Series 721969  3.0000  11/15/42   1,586,054 
 1,785,404   Government National Mortgage Association Series 711731  3.0000  03/15/43   1,632,429 
 1,576,425   Government National Mortgage Association Series 722001  3.5000  06/15/43   1,491,375 
 909,904   Government National Mortgage Association Series 722008  3.0000  08/15/43   827,435 
 1,121,691   Government National Mortgage Association Series 722010  3.5000  08/15/43   1,061,176 
 650,854   Government National Mortgage Association Series 722011  4.0000  08/15/43   643,610 
 1,999,610   Government National Mortgage Association Series 722013  3.5000  09/15/43   1,892,203 
 623,111   Government National Mortgage Association Series 722020  3.0000  12/15/43   561,238 
 1,758,626   Government National Mortgage Association Series 722021  3.5000  12/15/43   1,664,168 
 3,320,927   Government National Mortgage Association Series 609103  3.5000  01/15/44   3,142,524 
 1,965,455   Government National Mortgage Association Series 609163  3.5000  07/15/44   1,859,738 
 2,552,956   Government National Mortgage Association Series 609200  3.5000  10/15/44   2,415,204 
 1,717,008   Government National Mortgage Association Series 609214  3.0000  11/20/44   1,562,438 
 2,587,940   Government National Mortgage Association Series 626921  3.0000  03/15/45   2,328,282 
 8,039,296   Government National Mortgage Association Series 626934  3.0000  04/20/45   7,186,336 
 5,041,951   Government National Mortgage Association Series 626941  3.0000  05/15/45   4,535,089 
 2,825,395   Government National Mortgage Association Series 635068  3.0000  04/15/46   2,541,273 
 2,294,499   Government National Mortgage Association Series AE3319  3.0000  07/15/46   2,063,791 
 1,375,693   Government National Mortgage Association Series AW2756  3.0000  09/15/46   1,237,369 
 1,656,060   Government National Mortgage Association Series 635133  3.0000  10/20/46   1,480,343 
 2,161,820   Government National Mortgage Association Series AW3558  3.0000  11/15/46   1,944,403 
 1,021,123   Government National Mortgage Association Series 635153  3.0000  12/20/46   928,201 
 1,977,572   Government National Mortgage Association Series 690615  3.0000  06/15/47   1,771,312 

 

See accompanying notes to financials.

6

 

DGI BALANCED FUND
SCHEDULE OF INVESTMENTS (Unaudited) (Continued)
December 31, 2023

 

Principal      Coupon Rate       
Amount ($)      (%)  Maturity  Fair Value 
     U.S. GOVERNMENT & AGENCIES — 40.5% (Continued)           
     GOVERNMENT NATIONAL MORTGAGE ASSOCIATION — 28.9% (Continued)           
 1,972,272   Government National Mortgage Association Series 690625  3.0000  07/20/47  $1,763,538 
 550,117   Government National Mortgage Association Series BC3027  3.0000  03/15/48   494,794 
 2,098,326   Government National Mortgage Association Series AD6371  3.0000  03/15/48   1,876,867 
 3,167,832   Government National Mortgage Association Series BE1665  4.0000  05/20/48   3,127,627 
 2,671,209   Government National Mortgage Association Series BG5690  4.0000  09/15/48   2,641,453 
 979,160   Government National Mortgage Association Series BJ1540  3.5000  09/20/48   922,041 
 783,453   Government National Mortgage Association Series BJ1536  3.5000  09/20/48   737,760 
 2,747,765   Government National Mortgage Association Series BJ9877  4.0000  11/15/48   2,717,156 
 1,918,235   Government National Mortgage Association Series BJ9885  4.0000  12/15/48   1,896,867 
 1,010,568   Government National Mortgage Association Series BJ9893  3.5000  12/20/48   951,886 
 958,751   Government National Mortgage Association Series BJ9892  3.5000  01/15/49   893,951 
               87,237,037 
     TOTAL U.S. GOVERNMENT & AGENCIES (Cost $131,486,530)         122,150,892 
                 
Shares               
     SHORT-TERM INVESTMENT — 6.1%           
     MONEY MARKET FUND - 6.1%           
 18,343,720   Dreyfus Treasury Obligations Cash Management Fund, Institutional Class, 5.25% (Cost $18,343,720)(e)   18,343,720 
                 
     TOTAL INVESTMENTS - 99.3% (Cost $279,837,249)        $299,520,753 
     OTHER ASSETS IN EXCESS OF LIABILITIES - 0.7%         1,987,489 
     NET ASSETS - 100.0%        $301,508,242 

 

EAFE - Europe, Australasia and Far East
   
ETF - Exchange-Traded Fund
   
MSCI - Morgan Stanley Capital International
   
SPDR - Standard & Poor’s Depositary Receipt
   
SOFR30A - United States 30 Day Average SOFR Secured Overnight Financing Rate

 

(a)Percentage rounds to less than 0.1%.

 

(b)Interest only securities.

 

(c)Variable rate security; the rate shown represents the rate on December 31, 2023.

 

(d)Issuer operates under a Congressional charter; its securities are neither issued nor guaranteed by the U.S. government. The Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation currently operate under a federal conservatorship.

 

(e)Rate disclosed is the seven day effective yield as of December 31, 2023.

 

See accompanying notes to financials.

7

 

DGI Balanced Fund
STATEMENT OF ASSETS AND LIABILITIES (Unaudited)
December 31, 2023

 

ASSETS     
Investment securities:     
At cost  $279,837,249 
At value  $299,520,753 
Subscriptions receivable   86,970 
Reclaims receivable   1,035,787 
Dividends and interest receivable   804,479 
Receivable for securities sold   71,321 
Prepaid expenses & other assets   474,027 
TOTAL ASSETS   301,993,337 
      
LIABILITIES     
Due to custodian   72,004 
Redemptions payable   20,147 
Advisory fees payable   236,250 
Distribution (12b-1) fees payable   1 
Transfer agency fees payable   66,297 
Administration fees payable   37,562 
Trustees fees payable   11,663 
Accrued expenses and other liabilities   41,171 
TOTAL LIABILITIES   485,095 
NET ASSETS  $301,508,242 
      
Net Assets Consist Of:     
Paid in capital ($0 par value, unlimited shares authorized)  $272,301,792 
Accumulated earnings   29,206,450 
NET ASSETS  $301,508,242 

 

See accompanying notes to financials.

8

 

DGI Balanced Fund
STATEMENT OF ASSETS AND LIABILITIES (Unaudited)(Continued)
December 31, 2023

 

Net Asset Value Per Share:     
Class A Shares     
Net Assets  $1,041 
Shares of beneficial interest outstanding ($0 par value, unlimited shares authorized)   96 
Net asset value (Net Assets ÷ Shares Outstanding) and redemption price per share  $10.89 (2)
Maximum offering price per share (maximum sales charge of 3.50%)  $11.28 
      
Class C Shares     
Net Assets  $1,041 
Shares of beneficial interest outstanding ($0 par value, unlimited shares authorized)   96 
Net asset value (Net Assets ÷ Shares Outstanding), offering price and redemption price per share (1)  $10.89 (2)
      
Class I Shares     
Net Assets  $1,042 
Shares of beneficial interest outstanding ($0 par value, unlimited shares authorized)   96 
Net asset value (Net Assets ÷ Shares Outstanding), offering price and redemption price per share  $10.90 (2)
      
Class P Shares     
Net Assets  $183,066,432 
Shares of beneficial interest outstanding ($0 par value, unlimited shares authorized)   16,800,371 
Net asset value (Net Assets ÷ Shares Outstanding), offering price and redemption price per share  $10.90 
      
Class T Shares     
Net Assets  $100,161,666 
Shares of beneficial interest outstanding ($0 par value, unlimited shares authorized)   9,192,331 
Net asset value (Net Assets ÷ Shares Outstanding), offering price and redemption price per share  $10.90 
      
Class NT Shares     
Net Assets  $18,277,020 
Shares of beneficial interest outstanding ($0 par value, unlimited shares authorized)   1,677,266 
Net asset value (Net Assets ÷ Shares Outstanding), offering price and redemption price per share  $10.90 

 

(1)Redemptions made within 1 year of purchase may be assessed a redemption fee of 1.00%.

 

(2)Net asset value may not recalculate due to the rounding of net assets and/or shares outstanding.

 

See accompanying notes to financials.

9

 

DGI Balanced Fund
STATEMENT OF OPERATIONS (Unaudited)
For the Six Months Ended December 31, 2023

 

INVESTMENT INCOME     
Dividends (Foreign Taxes Withheld: $688,413)  $1,645,539 
Interest   2,097,497 
TOTAL INVESTMENT INCOME   3,743,036 
      
EXPENSES     
Investment advisory fees   1,377,443 
Distribution (12b-1) fees     
Class A    *
Class C   1 
Transfer agent fees   195,423 
Administrative services fees   134,017 
Legal fees   79,804 
Trustees fees and expenses   29,407 
Printing and postage expenses   26,930 
Compliance officer fees   18,025 
Audit and tax fees   12,505 
Insurance fees   7,117 
Other expenses   12,081 
TOTAL EXPENSES   1,892,753 
      
NET INVESTMENT INCOME   1,850,283 
      
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS     
Net realized gain on:     
Investments   9,393,239 
      
Net change in unrealized appreciation on:     
Investments   9,231,468 
      
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS   18,624,707 
      
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS  $20,474,990 

 

*Amount represents less than $0.50.

 

See accompanying notes to financials.

10

 

DGI Balanced Fund
STATEMENTS OF CHANGES IN NET ASSETS

 

   Six Months* Ended   Year Ended 
   December 31, 2023   June 30, 
   (Unaudited)   2023 
FROM OPERATIONS          
Net investment income  $1,850,283   $4,908,370 
Net realized gain from investments   9,393,239     
Net change in unrealized appreciation/(depreciation) on investments   9,231,468    (1,504,349)
Net increase in net assets resulting from operations   20,474,990    3,404,021 
           
DISTRIBUTIONS          
Distributions to shareholders          
Class P Shares   (2,906,951)   (2,259,828)
Class T Shares   (1,547,269)   (1,214,725)
Class NT Shares   (293,916)   (235,855)
From distributions to shareholders   (4,748,136)   (3,710,408)
           
FROM SHARES OF BENEFICIAL INTEREST          
Proceeds from shares sold:          
Class A Shares   1,000     
Class C Shares   1,000     
Class I Shares   1,000     
Class P Shares   1,499,912    6,107,787 
Class T Shares   50,764    311,471 
Class NT Shares   4,482    51,152 
Net asset value of shares issued in reinvestment of distributions:          
Class T Shares   2,869,494    1,656,916 
Payments for shares redeemed:          
Class P Shares   (10,282,889)   (24,565,890)
Class T Shares   (5,955,405)   (12,669,645)
Class NT Shares   (1,519,419)   (2,380,849)
Net decrease in net assets from shares of beneficial interest   (13,330,061)   (31,489,058)
           
TOTAL INCREASE/(DECREASE) IN NET ASSETS   2,396,793    (31,795,445)
           
NET ASSETS          
Beginning of year/period   299,111,449    330,906,894 
End of year/period  $301,508,242   $299,111,449 

 

*Class A, Class C, and Class I shares commenced investment operations on December 6, 2023.

 

See accompanying notes to financials.

11

 

DGI Balanced Fund
STATEMENTS OF CHANGES IN NET ASSETS (Continued)

 

   Six Months* Ended   Year Ended 
   December 31, 2023   June 30, 
   (Unaudited)   2023 
SHARE ACTIVITY          
Class A Shares:          
Shares Sold   96     
Net increase in shares of beneficial interest outstanding   96     
           
Class C Shares:          
Shares Sold   96     
Net increase in shares of beneficial interest outstanding   96     
           
Class I Shares:          
Shares Sold   96     
Net increase in shares of beneficial interest outstanding   96     
           
Class P Shares:          
Shares Sold   145,276    602,763 
Shares Redeemed   (990,459)   (2,421,930)
Net decrease in shares of beneficial interest outstanding   (845,183)   (1,819,167)
           
Class T Shares:          
Shares Sold   4,732    31,046 
Shares Reinvested   297,049    169,766 
Shares Redeemed   (571,340)   (1,247,203)
Net decrease in shares of beneficial interest outstanding   (269,559)   (1,046,391)
           
Class NT Shares:          
Shares Sold   419    5,081 
Shares Redeemed   (145,288)   (233,502)
Net decrease in shares of beneficial interest outstanding   (144,869)   (228,421)

 

*Class A, Class C, and Class I shares commenced investment operations on December 6, 2023.

 

See accompanying notes to financials.

12

 

DGI Balanced Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout the Period

 

   Class A Shares 
   Period* Ended 
   December 31, 2023 
   (Unaudited) 
Net asset value, beginning of period  $10.46 
Activity from investment operations:     
Net investment income (1,2)   0.03 
Net realized and unrealized gain/(loss) on investments   0.40 
Total from investment operations   0.43 
Net asset value, end of period  $10.89 
Total return (3)   4.11%
Net assets, end of period (4)  $1,041 
Ratio of expenses to average net assets (5,6)   1.53%
Ratio of net investment income to average net assets (2,5,6)   1.00%
Portfolio Turnover Rate (7)   4%

 

*The DGI Balanced Fund Class A shares commenced operations on December 6, 2023.

 

(1)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

 

(2)Recognition of net investment income by the Fund is affected by the timing of the declaration of dividends by the underlying investment companies in which the Fund invests.

 

(3)Total returns are historical and assume changes in share price and reinvestment of dividends, if any. Total returns for periods of less than one year are not annualized.

 

(4)Actual net asset amount.

 

(5)Does not include the expenses of other investment companies in which the Fund invests, if any.

 

(6)Annualized.

 

(7)Not Annualized.

 

See accompanying notes to financials.

13

 

DGI Balanced Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout the Period

 

   Class C Shares 
   Period* Ended 
   December 31, 2023 
   (Unaudited) 
Net asset value, beginning of period  $10.46 
Activity from investment operations:     
Net investment income (1,2)   0.02 
Net realized and unrealized gain/(loss) on investments   0.41 
Total from investment operations   0.43 
Net asset value, end of period  $10.89 
Total return (3)   4.11%
Net assets, end of period (4)  $1,041 
Ratio of expenses to average net assets (5,6)   2.28%
Ratio of net investment income to average net assets (2,5,6)   0.25%
Portfolio Turnover Rate (7)   4%

 

*The DGI Balanced Fund Class C shares commenced operations on December 6, 2023.

 

(1)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

 

(2)Recognition of net investment income by the Fund is affected by the timing of the declaration of dividends by the underlying investment companies in which the Fund invests.

 

(3)Total returns are historical and assume changes in share price and reinvestment of dividends, if any. Total returns for periods of less than one year are not annualized.

 

(4)Actual net asset amount.

 

(5)Does not include the expenses of other investment companies in which the Fund invests, if any.

 

(6)Annualized.

 

(7)Not Annualized.

 

See accompanying notes to financials.

14

 

DGI Balanced Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout the Period

 

   Class I Shares 
   Period* Ended 
   December 31, 2023 
   (Unaudited) 
Net asset value, beginning of period  $10.46 
Activity from investment operations:     
Net investment income (1,2)   0.03 
Net realized and unrealized gain/(loss) on investments   0.41 
Total from investment operations   0.44 
Net asset value, end of period  $10.90 
Total return (3)   4.21%
Net assets, end of period (4)  $1,042 
Ratio of expenses to average net assets (5,6)   1.28%
Ratio of net investment income to average net assets (2,5,6)   1.25%
Portfolio Turnover Rate (7)   4%

 

*The DGI Balanced Fund Class I shares commenced operations on December 6, 2023.

 

(1)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

 

(2)Recognition of net investment income by the Fund is affected by the timing of the declaration of dividends by the underlying investment companies in which the Fund invests.

 

(3)Total returns are historical and assume changes in share price and reinvestment of dividends, if any. Total returns for periods of less than one year are not annualized.

 

(4)Actual net asset amount.

 

(5)Does not include the expenses of other investment companies in which the Fund invests, if any.

 

(6)Annualized.

 

(7)Not Annualized.

 

See accompanying notes to financials.

15

 

DGI Balanced Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout each Year/Period

 

   Class P Shares 
   Six Months Ended   Year Ended   Year Ended   Period* Ended 
   December 31, 2023   June 30,   June 30,   June 30, 
   (Unaudited)   2023   2022   2021 
Net asset value, beginning of year/period  $10.34   $10.33   $11.58   $11.53 
Activity from investment operations:                    
Net investment income (1,2)   0.06    0.16    0.08    0.03 
Net realized and unrealized gain/(loss) on investments   0.67    (0.03)   (1.28)   0.02 
Total from investment operations   0.73    0.13    (1.20)   0.05 
Distribution to Shareholders from Ordinary Income   (0.17)   (0.12)   (0.05)    
Total distributions   (0.17)   (0.12)   (0.05)    
Net asset value, end of year/period  $10.90   $10.34   $10.33   $11.58 
Total return (3)   7.25%   1.32%   (10.45)%   0.43%
Net assets, end of year/period (000’s)  $183,066   $182,443   $201,136   $236,301 
Ratio of expenses to average net assets (4)   1.28% (6)   1.31% (5)   1.40%   1.17% (6)
Ratio of net investment income to average net assets (2,4)   1.25% (6)   1.58%   0.68%   2.10% (6)
Portfolio Turnover Rate   4% (7)   2%   3%   0% (7)

 

*The DGI Balanced Fund Class P shares commenced operations on May 23, 2021.

 

(1)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

 

(2)Recognition of net investment income by the Fund is affected by the timing of the declaration of dividends by the underlying investment companies in which the Fund invests.

 

(3)Total returns are historical and assume changes in share price and reinvestment of dividends, if any. Total returns for periods of less than one year are not annualized.

 

(4)Does not include the expenses of other investment companies in which the Fund invests, if any.

 

(5)Excludes the reversal of tax expenses accrued during the fiscal year ended June 30, 2022. Had this reversal been included, the ratio of expenses to average net assets would have been 1.16% for the fiscal year ended June 30, 2023.

 

(6)Annualized.

 

(7)Not Annualized.

 

See accompanying notes to financials.

16

 

DGI Balanced Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout each Year/Period

 

   Class T Shares 
   Six Months Ended   Year Ended   Year Ended   Period* Ended 
   December 31, 2023   June 30,   June 30,   June 30, 
   (Unaudited)   2023   2022   2021 
Net asset value, beginning of year/period  $10.34   $10.33   $11.58   $11.53 
Activity from investment operations:                    
Net investment income (1,2)   0.06    0.16    0.08    0.03 
Net realized and unrealized gain/(loss) on investments   0.67    (0.03)   (1.28)   0.02 
Total from investment operations   0.73    0.13    (1.20)   0.05 
Distribution to Shareholders from Ordinary Income   (0.17)   (0.12)   (0.05)    
Total distributions   (0.17)   (0.12)   (0.05)    
Net asset value, end of year/period  $10.90   $10.34   $10.33   $11.58 
Total return (3)   7.25%   1.32%   (10.45)%   0.43%
Net assets, end of year/period (000’s)  $100,162   $97,828   $108,581   $130,443 
Ratio of expenses to average net assets (4)   1.28% (6)   1.31% (5)   1.40%   1.17% (6)
Ratio of net investment income to average net assets (2,4)   1.25% (6)   1.58%   0.68%   2.10% (6)
Portfolio Turnover Rate   4% (7)   2%   3%   0% (7)

 

*The DGI Balanced Fund Class T shares commenced operations on May 23, 2021.

 

(1)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

 

(2)Recognition of net investment income by the Fund is affected by the timing of the declaration of dividends by the underlying investment companies in which the Fund invests.

 

(3)Total returns are historical and assume changes in share price and reinvestment of dividends, if any. Total returns for periods of less than one year are not annualized.

 

(4)Does not include the expenses of other investment companies in which the Fund invests, if any.

 

(5)Excludes the reversal of tax expenses accrued during the fiscal year ended June 30, 2022. Had this reversal been included, the ratio of expenses to average net assets would have been 1.16% for the fiscal year ended June 30, 2023.

 

(6)Annualized.

 

(7)Not Annualized.

 

See accompanying notes to financials.

17

 

DGI Balanced Fund
FINANCIAL HIGHLIGHTS

 

Per Share Data and Ratios for a Share of Beneficial Interest Outstanding Throughout each Year/Period

 

   Class NT Shares 
   Six Months Ended   Year Ended   Year Ended   Period* Ended 
   December 31, 2023   June 30,   June 30,   June 30, 
   (Unaudited)   2023   2022   2021 
Net asset value, beginning of year/period  $10.34   $10.33   $11.58   $11.53 
Activity from investment operations:                    
Net investment income (1,2)   0.06    0.16    0.08    0.03 
Net realized and unrealized gain/(loss) on investments   0.67    (0.03)   (1.28)   0.02 
Total from investment operations   0.73    0.13    (1.20)   0.05 
Distribution to Shareholders from Ordinary Income   (0.17)   (0.12)   (0.05)    
Total distributions   (0.17)   (0.12)   (0.05)    
Net asset value, end of year/period  $10.90   $10.34   $10.33   $11.58 
Total return (3)   7.25%   1.32%   (10.45)%   0.43%
Net assets, end of year/period (000’s)  $18,277   $18,840   $21,189   $25,386 
Ratio of expenses to average net assets (4)   1.28% (6)   1.31% (5)   1.40%   1.17% (6)
Ratio of net investment income to average net assets (2,4)   1.25% (6)   1.58%   0.68%   2.10% (6)
Portfolio Turnover Rate   4% (7)   2%   3%   0% (7)

 

*The DGI Balanced Fund Class NT shares commenced operations on May 23, 2021.

 

(1)Per share amounts calculated using the average shares method, which more appropriately presents the per share data for the period.

 

(2)Recognition of net investment income by the Fund is affected by the timing of the declaration of dividends by the underlying investment companies in which the Fund invests.

 

(3)Total returns are historical and assume changes in share price and reinvestment of dividends, if any. Total returns for periods of less than one year are not annualized.

 

(4)Does not include the expenses of other investment companies in which the Fund invests, if any.

 

(5)Excludes the reversal of tax expenses accrued during the fiscal year ended June 30, 2022. Had this reversal been included, the ratio of expenses to average net assets would have been 1.16% for the fiscal year ended June 30, 2023.

 

(6)Annualized.

 

(7)Not Annualized.

 

See accompanying notes to financials.

18

 

DGI Balanced Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited)
December 31, 2023

 

1.ORGANIZATION

 

The DGI Balanced Fund (the “Fund”) is a diversified series of shares of beneficial interest of DGI Investment Trust (the “Trust”), a collective investment trust formed and organized under the laws of the Commonwealth of Puerto Rico (the “Commonwealth” or “Puerto Rico”) pursuant to a certain Deed of Constitution of Trust, dated January 28, 2021, as amended and restated from time to time (the “Deed of Trust”), and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as a diversified, open-end management investment company. The Fund offers Class A, Class C, Class I, Class P, Class T, and Class NT shares. The Fund commenced investment operations for Class P, Class T, and Class NT shares on May 23, 2021. Class A, Class C, and Class I shares commenced investment operations on December 6, 2023. The Fund’s investment objective is to seek long-term capital appreciation and current income. Investment in the Fund is intended for residents of Puerto Rico.

 

Class A shares are offered at net asset value plus a maximum sales charge of 3.50%. A contingent deferred sales charge (“CDSC”) of 1.00% is assessed on redemptions of Class C shares made within one year after a purchase of such shares. Each class of shares represents an interest in the same portfolio of investments of the Fund and are identical in all respects to each other class of the Fund, except as set forth in the Fund’s multiple class plan pursuant to Rule 18f-3 under the 1940 Act.

 

2.SIGNIFICANT ACCOUNTING POLICIES

 

The following is a summary of significant accounting policies followed by the Fund in preparation of its financial statements. The policies are in conformity with U.S. generally accepted accounting principles in the United States of America (“U.S. GAAP”). The preparation of the financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates. The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 “Financial Services – Investment Companies”.

 

Securities Valuation – The Fund’s assets will be valued based upon market quotations when such quotations are available. A security listed or traded on any exchange in the United States will be valued at its last sales price on the principal exchange on which it is traded prior to the time the assets of the Fund are valued. If no sale is reported at that time or the security is traded in the over-the-counter (“OTC”) market, the most recent bid will be used for purposes of the valuation. Assets for which market quotations are not readily available will be valued at fair value as determined in good faith by the Fund’s investment adviser, pursuant to procedures approved by the Board of Trustees of the Trust (the “Board”). Debt securities (other than short-term obligations) are valued each day by an independent pricing service approved by the Board based on methods which include consideration of: yields or prices of securities of comparable quality, coupon, maturity and type, indications as to values from dealers, and general market conditions or market quotations from a major market maker in the securities. Investments valued in currencies other than the U.S. dollar are converted to U.S. dollars using exchange rates obtained from pricing services. Short-term debt obligations having 60 days or less remaining until maturity, at time of purchase, may be valued at amortized cost. These prices may change depending on market conditions.

 

Exchange Traded Funds – The Funds may invest in exchange traded funds (“ETFs”). ETFs are a type of index fund bought and sold on a securities exchange. An ETF trades like common stock and represents a fixed portfolio of securities designed to track the performance and dividend yield of a particular domestic or foreign market index. The Funds may purchase an ETF to temporarily gain exposure to a portion of the U.S. or a foreign market. The risks of owning an ETF generally reflect the risks of owning the underlying securities they are designed to track, although the lack of liquidity on an ETF could result in it being more volatile. Additionally, ETFs have fees and expenses that reduce their value.

 

The Fund utilizes various methods to measure the fair value of all of its investments on a recurring basis. GAAP establishes a hierarchy that prioritizes inputs to valuation methods. The three levels of input are:

 

Level 1 – Unadjusted quoted prices in active markets for identical assets and liabilities that the Fund has the ability to access.

 

Level 2 – Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument in an inactive market, prices for

19

 

DGI Balanced Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited)(Continued)
December 31, 2023

 

similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.

 

Level 3 – Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available; representing the Fund’s own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.

 

The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.

 

The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety, is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

 

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The following tables summarize the inputs used as of December 31, 2023 for the Fund’s assets and liabilities measured at fair value:

 

DGI Balanced Fund

 

Assets *  Level 1   Level 2   Level 3   Total 
U.S. Government & Agencies  $   $122,150,892   $   $122,150,892 
Collateralized Mortgage Obligations       80,532        80,532 
Exchange Traded Funds   131,434,159            131,434,159 
Common Stocks   27,511,450            27,511,450 
Money Market Fund   18,343,720            18,343,720 
Total  $177,289,329   $122,231,424   $   $299,520,753 

 

*Refer to the Schedule of Investments for classification.

 

The Funds did not hold any Level 3 securities during the period.

 

Security Transactions and Investment Income – Security transactions are accounted for on a trade date basis. Interest income is recognized on an accrual basis. Discounts are accreted and premiums are amortized on securities purchased over the lives of the respective securities using the effective interest method. Dividend income is recorded on the ex-dividend date. Realized gains or losses from sales of securities are determined by comparing the identified cost of the security lot sold with the net sales proceeds.

 

Dividends and Distributions – The Fund expects to declare and distribute all of its net investment income, if any, to shareholders as dividends at least annually. The amount of any distribution will vary, and there is no guarantee the Fund will pay either an income dividend or a capital gains distribution. Distributions will be reinvested in shares of the Fund, unless otherwise directed by the shareholder. Generally, distributions within taxable accounts are taxable events for shareholders whether the distributions are received in cash or reinvested.

 

Dividends consisting of Ordinary Dividends to individual shareholders will be distributed net of the 15% tax imposed by the Puerto Rico Internal Revenue Code of 2011, as amended (the “PR Code”), which will be automatically withheld at source by the Fund. All dividend distributions by the Fund to a tax advantaged account, such as a Puerto Rico tax-qualified retirement plan or IRA account, will be made on a gross basis, without any tax withholding, and will be reinvested automatically in shares of the Fund. Such distributions may be taxed as ordinary income when withdrawn from the tax-advantaged account.

 

In general, the Fund’s distributions will be subject to Puerto Rico income taxes as dividend income, capital gains, or some combination of both, unless you are investing through a tax advantaged arrangement, such as a Puerto Rico tax-qualified retirement plan or an IRA, in which case your distributions may be taxed as ordinary income when withdrawn from the tax-advantaged account. Such distributions will also be subject to U.S federal income taxes and the passive foreign investment company (“PFIC”) rules if received by a U.S. person not residing in Puerto Rico. Distributions to residents of Puerto Rico

20

 

DGI Balanced Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited)(Continued)
December 31, 2023

 

who own, directly or indirectly, less than 10% of the total shares of the Fund will not be subject to U.S. federal income taxes on dividends received from the Fund.

 

Cash – The Fund considers its investment in an FDIC insured interest bearing savings account to be cash. The Fund maintains cash balances, which, at times, may exceed federally insured limits. The Fund maintains these balances with a high-quality financial institution.

 

Indemnification – The Fund indemnifies its officers and Trustees for certain liabilities that may arise from the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts that contain a variety of representations and warranties and which provide general indemnities. The Fund’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred. However, based on experience, the risk of loss due to these warranties and indemnities appears to be remote.

 

3.INVESTMENT TRANSACTIONS AND ASSOCIATED RISKS

 

For the six months ended December 31, 2023, the aggregate purchases and sales of investments (excluding U.S. Government securities and short-term investments) were $10,179,507 and $17,986,861, respectively. For the six months ended December 31, 2023, the aggregate purchases and sales of U.S. Government securities were $0 and $6,663,736, respectively.

 

The Fund is subject to the risks of investing in equity securities. Equity securities are subject to changes in value, and their values may be more volatile than other asset classes, as a result of such factors as a company’s business performance, investor perceptions, stock market trends and general economic conditions. The Fund may invest in smaller companies, which may be subject to more abrupt or erratic market movements than stocks of larger, more established companies. The Fund may also invest in large-cap stocks, which as a group could fall out of favor with the market, causing the Fund to underperform investments that focus solely on small- or medium-capitalization stocks. Large cap companies may trail the returns of the overall stock market. The Fund may also invest in investment companies and exchange- traded funds (“ETFs”), which may not achieve their investment objectives or execute their investment strategies effectively, or a large purchase or redemption activity by shareholders might negatively affect the value of the shares.

 

The Fund may also invest in mortgage- and asset-backed securities, which are subject to credit and interest rate risks, as well as extension and prepayment risks. Rising interest rates tend to extend the duration of mortgage-related securities, making them more sensitive to changes in interest rates. As a result, in a period of rising interest rates, if the Fund holds mortgage-related securities, it may exhibit additional volatility. When interest rates decline, the value of mortgage-related securities with prepayment features may not increase as much as other fixed-income securities because borrowers may pay off their mortgages sooner than expected. Moreover, to the extent the Fund invests in FHA/VA Mortgage Securities, the yield of the shares will depend in some part on the rate at which principal payments are made on such securities, which in turn will depend on the rate at which principal prepayments are made on the underlying mortgage loans. These securities also are subject to risk of default on the underlying mortgage or asset, particularly during periods of economic downturn. Small movements in interest rates (both increases and decreases) may quickly and significantly reduce the value of certain mortgage-backed securities.

 

The Fund may also invest in debt securities, which are subject to similar risks. For instance, increases in the federal funds rate may expose fixed-income and related markets to heightened volatility and may reduce liquidity for certain Fund investments, which could cause the value of the Fund’s investments and share price to decline. The Fund may invest in corporate debt securities, which are subject to the risk of the issuer’s inability to meet principal and interest payments on the obligations and may also be subject to price volatility due to factors such as market interest rates, market perception of the creditworthiness of the issuer and general market liquidity. The market value of a debt security generally reacts inversely to interest rate changes. Furthermore, issuers of fixed -income securities could default or be downgraded if they fail to make required payments of principal or interest. The Fund only invests in investment grade securities; however, the Fund will not be required to dispose of a debt that has its rating downgraded subsequent to the Fund’s purchase.

 

The Fund may invest in U.S. government obligations, which have different levels of credit support and, therefore, different degrees of credit risk. The U.S. government does not guarantee the market value of the securities it issues, so those values may fluctuate. In addition, the payment obligations on certain securities in which the Fund may invest, including securities issued by certain U.S. Government agencies and U.S. Government sponsored enterprises, are not guaranteed by the U.S.

21

 

DGI Balanced Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited)(Continued)
December 31, 2023

 

Government or supported by the full faith and credit of the United States.

 

To the extent that the Fund invests a significant portion of its assets in the Commonwealth of Puerto Rico (the “Puerto Rico”), the Fund is more susceptible to factors adversely affecting Puerto Rico. Puerto Rico’s economy suffered a severe and prolonged recession from 2007 to 2017, with real gross national product contracting approximately 15% during this period. Since 2017, Puerto Rico and several of its instrumentalities have entered debt-restructuring proceedings under Titles III and VI of the Puerto Rico Oversight, Management & Economic Stability Act (“PROMESA”). However, Puerto Rico has begun to implement the plan of adjustment approved on January 18, 2022 in the court-supervised debt-restructuring process under Title III of PROMESA, setting the stage for its exit from bankruptcy. Puerto Rico is also susceptible to hurricanes, major storms and earthquakes that affect the local economy and its population has declined over the past decade. Therefore, any factors affecting Puerto Rico will have a greater effect on the Fund’s performance than they would in a more geographically diversified fund.

 

Overall, the value of stocks and other securities can be highly volatile, and prices may fluctuate widely, which means you should expect a wide range of returns and could lose money, even over a long time period. Various economic, industry, regulatory, political, or other factors (such as natural disasters, epidemics and pandemics, war, terrorism, conflicts or social unrest) may disrupt U.S. and world economies and can dramatically affect markets generally, certain industry sectors, and/or individual companies.

 

4.INVESTMENT ADVISORY AGREEMENT AND TRANSACTION WITH RELATED PARTIES

 

Oriental Trust, a separately identifiable division of Oriental Bank (the “Adviser”), acts as investment adviser to the Fund under an investment advisory agreement (the “Advisory Agreement”) with the Fund. Under the Advisory Agreement, the Fund pays to the Adviser a monthly advisory fee at an annual rate of 0.93% of its average daily net assets. Pursuant to the advisory agreement, the Fund incurred $1,377,443 in advisory fees for the six months ended December 31, 2023.

 

Effective June 30, 2023, Northern Lights Distributors, LLC, (the “Distributor”) is the distributor for the Fund. Prior to June 30, 2023, the distributor of the Fund was Oriental Financial Services LLC.

 

Pursuant to a separate servicing agreement with Ultimus Fund Solutions, LLC (“UFS”), an affiliate of the Distributor, the Fund pays UFS fees for providing administration, fund accounting and transfer agency services to the Fund. Certain officers of the Trust are also officers of UFS, and are not paid any fees directly by the Fund for serving in such capacities.

 

The Trust has adopted a Distribution Plan (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act. The Plan provides that a monthly service and/or distribution fee is calculated by the Fund at an annual rate of 0.25% of its average daily net assets for Class A shares and 1.00% of its average daily net assets for Class C shares and is paid to Northern Lights Distributors, LLC (the “Distributor”) to provide compensation for ongoing shareholder servicing and distribution-related activities or services and/or maintenance of the Fund’s shareholder accounts not otherwise required to be provided by the Advisor. For the six months ended December 31, 2023, $0 and $1 of 12b-1 fees were accrued for Class A shares and Class C shares, respectively.

 

The Distributor acts as the Fund’s principal underwriter in a continuous public offering of the Fund’s Class A, Class C, and Class I shares. The Distributor is an affiliate of UFS. For the six months ended December 31, 2023, the Distributor received $70 and $20 in underwriting commissions for sales of Class A shares and Class C shares, respectively, of which $0 and $0 was retained by the principal underwriter for Class A shares and Class C shares, respectively.

 

In addition, certain affiliates of UFS provide ancillary services to the Fund as follows:

 

Northern Lights Compliance Services, LLC (“NLCS”), an affiliate of the Distributor and UFS, provides a Chief Compliance Officer to the Trust, as well as related compliance services, pursuant to a consulting agreement between NLCS and the Trust. Under the terms of such agreement, NLCS receives fees from the Fund.

 

Blu Giant, LLC (“Blu Giant”), an affiliate of the Distributor and UFS, provides EDGAR conversion and filing services as well as print management services for the Fund on an ad-hoc basis. For the provision of these services, Blu Giant receives fees from the Fund.

22

 

DGI Balanced Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited)(Continued)
December 31, 2023

 

5.TAX INFORMATION

 

The Fund is intended solely for residents of Puerto Rico. The Fund will be treated as a registered investment company under the PR Code. As such, the Fund will be exempt from Puerto Rico income tax for a taxable year if it distributes to its shareholders at least 90% of its net income for the taxable year within the time period provided by the PR Code.

 

The Fund did not distribute 90% of its income to shareholders for the taxable year June 30, 2021 and therefore recorded a tax expense of $445,825 during the fiscal year ended June 30, 2022. During the fiscal year ended June 30, 2023, it was determined that the Fund was not responsible for this tax expense and the accrual was reversed.

 

The Fund will be treated as a PFIC under the United States Internal Revenue Code of 1986, as amended (the “US Code”). As such, the Fund will not qualify as a regulated investment company under Subchapter M of the US Code and will be treated as a non-U.S. corporation whose only business activity in the United States is trading in stocks or securities for its own account; which, under the US Code, does not constitute engaging in the conduct of a trade or business within the United States, even if its principal office is located therein. As a result, the Fund will be subject to U.S. federal income tax withholding only with respect to certain types of income from United States sources considered fixed, determinable, annual and periodic income (such as dividends and interest paid by U.S. payors).

 

In general, the Fund’s distributions will be subject to Puerto Rico income taxes as dividend income, capital gains, or some combination of both, unless you are investing through a tax-advantaged arrangement, such as a Puerto Rico tax-qualified retirement plan or an IRA, in which case your distributions may be taxed as ordinary income when withdrawn from the tax-advantaged account. Such distributions will also be subject to U.S federal income taxes and the PFIC rules if received by a U.S. person not residing in Puerto Rico. Distributions to residents of Puerto Rico who own, directly or indirectly, less than 10% of the total shares of the Fund will not be subject to U.S. federal income taxes.

 

6.TAX COMPONENTS OF CAPITAL

 

The tax attributes of distributions paid during the fiscal years ended June 30, 2023 and June 30, 2022, were as follows:

 

   Fiscal Year Ended   Fiscal Year Ended 
   June 30, 2023   June 30, 2022 
Ordinary Income  $3,710,408   $1,528,381 
Long-Term Capital Gain        
Return of Capital        
Total  $3,710,408   $1,528,381 

 

The Fund’s net investment income and net realized gain (loss) on investments reflected in the financial statements differ from distributable net investment income and net realized gain (loss) on investments for tax purposes. Permanent book and tax differences are primarily attributable to the tax adjustments for paydowns from mortgage-backed securities, as follows:

 

   2023 
Net investment income per statement of operations  $3,404,021 
Reclassification of realized loss on securities’ paydown for tax purposes   284,623 
Distributable net investment income for tax purposes  $3,688,644 
      
Net realized gain (loss) on investments per statement of operations  $ 
Reclassification of realized loss on securities’ paydown for tax purposes   (284,623)
Net realized loss on investments for tax purposes  $(284,623)

23

 

DGI Balanced Fund
NOTES TO FINANCIAL STATEMENTS (Unaudited)(Continued)
December 31, 2023

 

The undistributed net investment income and accumulated net realized loss on investments (tax basis) at June 30, 2023, was as follows:

 

   2023 
Undistributed net investment income, beginning of the year  $2,597,377 
Net investment income for the year   3,688,644 
Distributions   (3,710,408)
Undistributed net investment income, end of the year  $2,575,613 

 

Accumulated net realized loss on investments and future contracts, beginning of the year  $(767,779)
Net realized loss on investments for the year, tax basis   (284,623)
Distributions    
end of the year, tax basis  $(1,052,402)

 

7.CONTROL OWNERSHIP

 

The beneficial ownership, either directly or indirectly, of more than 25% of the voting securities of the Fund creates presumption of control of the Fund, under Section 2(a) 9 of the 1940 Act. As of December 31, 2023, Pershing, holding shares for the benefit of others in nominee name, held approximately 99.5% of the voting securities of the Fund.

 

8.RECENT REGULATORY UPDATES

 

On January 24, 2023, the SEC adopted rule and form amendments relating to Tailored Shareholder Reports to require mutual funds and ETFs to transmit concise and visually engaging streamlined annual and semiannual reports to shareholders that highlight key information. Other information, including financial statements, will not appear in the Tailored Shareholder Reports but must be available online, delivered free of charge upon request, and filed on a semiannual basis on Form N-CSR. The rule and form amendments have a compliance date of July 24, 2024. At this time, management is evaluating the impact of these amendments on the Fund.

 

9.SUBSEQUENT EVENTS

 

Subsequent events after the date of the Statement of Assets and Liabilities have been evaluated through the date the financial statements were issued. Management has determined that no events or transactions occurred requiring adjustment or disclosure in the financial statements.

24

 

DGI Balanced Fund
EXPENSE EXAMPLES (Unaudited)
December 31, 2023

 

As a shareholder of the DGI Balanced Fund, you incur ongoing costs, including management fees and certain Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and compare these costs with the ongoing costs of investing in other mutual funds.

 

The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from July 1, 2023 through December 31, 2023.

 

Actual Expenses

 

The “Actual Expenses” line in the table below provides information about actual account values and actual expenses. You may use the information below, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

 

Hypothetical Example for Comparison Purposes

 

The “Hypothetical” line in the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balances or expenses you paid for the period. You may use this information to compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

 

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales loads, or redemption fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

      Actual   Hypothetical (5% return before
expenses)
  Annualized
Expense Ratio
Beginning
Account
Value
7/1/2023
Ending
Account Value
12/31/2023
Expenses Paid
During Period
7/1/23-12/31/23
  Ending
Account Value
12/31/2023
Expenses Paid
During Period
7/1/23-12/31/23
               
Class A* 1.60% $1,000.00 $1,041.10 $1.11   $1,017.44 $7.76
Class C* 2.26% $1,000.00 $1,041.10 $1.65   $1,013.67 $11.54
Class I* 1.27% $1,000.00 $1,042.10 $0.93   $1,018.70 $6.50
Class P^ 1.28% $1,000.00 $1,072.50 $6.67   $1,018.70 $6.50
Class T^ 1.28% $1,000.00 $1,072.50 $6.67   $1,018.70 $6.50
Class NT^ 1.28% $1,000.00 $1,072.50 $6.67   $1,018.70 $6.50

 

*“Actual” expense information is for the period from December 6, 2023 (date of initial investment) to December 31, 2023. Actual expenses are equal to the Fund’s annualized expense ratio, multiplied by 26/366 (to reflect the period from initial investment to December 31, 2023). “Hypothetical” expense information for the Fund is presented on the basis of the full one-half year period to enable comparison to other funds. It is based on assuming the same net expense ratio and average account value over the period, but it is multiplied by 184/366 (to reflect the full half-year period).

 

^Expenses paid during the period are equal to the Fund’s annualized expense ratio, multiplied by the average account value over the period, multiplied by 184/366 (to reflect the full half-year period).

25

 

PROXY VOTING POLICY

 

Information regarding how the Fund voted proxies relating to portfolio securities for the most recent twelve month period ended June 30 as well as a description of the policies and procedures that the Fund uses to determine how to vote proxies is available without charge, upon request, by calling (787) 620-0000 or by referring to the Securities and Exchange Commission’s (“SEC”) website at http://www.sec.gov.

 

PORTFOLIO HOLDINGS

 

The Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to Form N-PORT. Form N-PORT are available on the SEC’s website at http://www.sec.gov. The information on Form N-PORT is available without charge, upon request, by calling (787) 620-0000.

 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
INVESTMENT ADVISER
Oriental Trust
254 Munoz Rivera Avenue, 10th Floor
San Juan, Puerto Rico 00918
 
ADMINISTRATOR
Ultimus Fund Solutions, LLC
225 Pictoria Drive, Suite 450
Cincinnati, OH 45246
 
DGIPR-SAR-23

 

 

(b)       Include a copy of each notice transmitted to stockholders in reliance on Rule 30e-3 under the Act (17 CFR 270.30e-3) that contains disclosures specified by paragraph (c)(3) of that rule.

 

Item 2. Code of Ethics. Not applicable.

 

Item 3. Audit Committee Financial Expert. Not applicable.

 

Item 4. Principal Accountant Fees and Services. Not applicable.

 

Item 5. Audit Committee of Listed Companies. Not applicable to open-end investment companies.

 

Item 6. Schedule of Investments. Schedule of investments in securities of unaffiliated issuers is included under Item 1.

 

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Funds. Not applicable to open-end investment companies.

 

Item 8. Portfolio Managers of Closed-End Management Investment Companies. Not applicable to open-end investment companies.

 

Item 9. Purchases of Equity Securities by Closed-End Funds. Not applicable to open-end investment companies.

 

Item 10. Submission of Matters to a Vote of Security Holders. None

 

Item 11. Controls and Procedures.

 

(a)       Based on an evaluation of the Registrant’s disclosure controls and procedures as of a date within 90 days of filing date of this Form N-CSR, the principal executive officer and principal financial officer of the Registrant have concluded that the disclosure controls and procedures of the Registrant are reasonably designed to ensure that the information required in filings on Form N-CSR is recorded, processed, summarized, and reported by the filing date, including that information required to be disclosed is accumulated and communicated to the Registrant’s management, including the Registrant’s principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

 

(b)       There were no significant changes in the Registrant’s internal control over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

 

Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies. Not applicable to open-end investment companies.

 

Item 13. Exhibits.

 

(a)(1) Code of Ethics filed herewith.

 

(a)(2) Certifications required by Section 302 of the Sarbanes-Oxley Act of 2002 (and Item 11(a)(2) of Form N-CSR) are filed herewith.

 

(a)(3) Not applicable for open-end investment companies.

 

(b)       Certifications required by Section 906 of the Sarbanes-Oxley Act of 2002 (and Item 11(b) of Form N-CSR) are filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

(Registrant) DGI Investment Trust

 

By (Signature and Title)

/s/ Ramon Rosado-Linera

Ramon Rosado-Linera, Principal Executive Officer/President

 

Date 3/5/24

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

By (Signature and Title)

/s/ Ramon Rosado-Linera

Ramon Rosado-Linera, Principal Executive Officer/President

 

Date 3/5/24

 

By (Signature and Title)

/s/ Maritza Arizmendi Diaz

Maritza Arizmendi Diaz, Principal Financial Officer/Treasurer

 

Date 3/6/24