Download Annual Report - John Hancock Investments

John Hancock Freedom 529
Annual report 6/30/16
John Hancock Freedom 529
Table of contents
3
John Hancock Freedom 529 Letter
4
Investment commentary
6
Long-term returns
9
Portfolio highlights—Enrollment-based portfolios
15
20
23
32
9
Portfolio 2033–2036
10
Portfolio 2029–2032
11
Portfolio 2025–2028
12
Portfolio 2021–2024
13
Portfolio 2017–2020
14
College Portfolio
Portfolio highlights—Static portfolios
15
Future Trends Portfolio
16
Equity Portfolio
17
Fixed Income Portfolio
18
Short-Term Bond Portfolio
19
Money Market Portfolio
Portfolio highlights—Lifestyle portfolios
20
Lifestyle Growth 529 Portfolio
21
Lifestyle Balanced 529 Portfolio
22
Lifestyle Moderate 529 Portfolio
Portfolio highlights—Individual portfolios
23
New Horizons Portfolio
24
Capital Appreciation Portfolio
25
Small-Cap Stock Portfolio
26
Blue Chip Growth Portfolio
27
International Value Portfolio
28
Mid-Cap Value Portfolio
29
Equity Income Portfolio
30
American Mutual Portfolio
Selected financial data
1
2
John Hancock Freedom 529 Letter
Dear College Saver:
The past 12 months ended June 30, 2016, marked a volatile stretch for equity investors. Major U.S. equity indexes endured two
corrections—declines of 10% or more—during the year but recovered quickly both times and went on to reach new highs. The
rally that began in 2009 has remained intact. However, the UK’s June 23 vote to leave the European Union (Brexit) has added
uncertainty to the global economic outlook, and it remains to be seen whether other countries will follow suit. Many investment
professionals believe that global central banks will likely expand their efforts to stimulate economic activity and that the fallout from
Brexit, combined with the November U.S. presidential election, may delay the U.S. Federal Reserve’s next interest rate increase until
December or even next year, which should help support markets.
Whether the markets are up or down, your financial advisor can help ensure your portfolio is sufficiently diversified to meet your
long-term objectives and to withstand the inevitable bumps along the way.1
Some positive changes to the tax status of 529 Plans
The Protecting Americans from Tax Hikes (PATH) Act, signed into law in December 2015, includes several items beneficial to 529
college savings plans.
ƒƒ Computers now qualify as higher education expense. The definition of qualified higher education expenses has been
expanded to include expenses for buying computers and peripheral equipment (e.g., printers), computer software, and Internet
access and related services.
ƒƒ Tuition refunds can be recontributed without taxes or penalties. In cases where a student took a distribution and
received a refund from the school (e.g., if the student dropped a class mid-semester), the previously distributed amount is not
taxed or penalized if it is recontributed within 60 days of the refund to an account (in the same or another qualified tuition
program) of which the student is the Beneficiary.
ƒƒ Multiple accounts no longer need to be aggregated for purposes of computing the earnings portion of a
distribution. If a Beneficiary has accounts in multiple 529 programs with a given state, the earnings portion of a distribution no
longer needs to be aggregated among separate plans.
These and other changes can be found in your updated Plan Disclosure Document, which you can find in the college savings section
of jhinvestments.com.
We know you have many choices when it comes to saving for your child, and on behalf of everyone at the firm, I thank you for
choosing John Hancock Freedom 529.
Sincerely,
Andrew G. Arnott
President and CEO
John Hancock Investments
1Diversification
cannot assure a profit or protect against loss in a declining market.
3
Investment commentary
Market Commentary
optimism that global central banks would take action to contain the
post-Brexit fallout, generating a gain for the large-cap S&P 500 Index
for our fiscal year.
Market performance has a direct effect on the overall performance of
investments in the John Hancock Freedom 529 Plan. The following is
designed to provide a summary of market performance for the period
ended June 30, 2016.
U.S. Stocks Gain Despite Economic And Political Turmoil
U.S. stocks ended on a mixed note for the year ended June 30,
2016, a volatile period for global financial markets. Major U.S. stock
market indexes began the period near record highs but fell with
other global stock markets in the summer of 2015 after a sell-off in
mainland Chinese stocks and a devaluation in the country’s currency.
Global markets stabilized in the final months of 2015 but entered
another downturn in early 2016 as tumbling prices for oil and other
commodities revived concerns about the world economic outlook. By
mid-February, U.S. small-caps and some non-U.S. markets entered a
bear market—defined as a drop of at least 20% from recent highs—
and oil prices sank to a 13-year low. Stocks advanced in the ensuing
months as oil prices rebounded and new stimulus measures in Europe
and Japan took effect. Assurances from the Federal Reserve that it
would proceed cautiously in raising interest rates after it raised shortterm rates in December also boosted sentiment. The June 23 Brexit
vote derailed the U.S. market’s advance, causing a two-day global
stock sell-off that briefly pushed the major U.S. stock indexes into the
red for 2016. However, stocks rallied in the last three days of June on
U.S. small-cap stocks underperformed mid- and large-cap stocks.
According to various Russell indexes, value stocks outperformed growth
stocks among small- and mid-cap shares, while large-cap growth and
value stocks performed roughly even. Among the S&P 500 sectors,
utilities and telecommunication services performed the best as investors
sought dividend-paying stocks. Financials fell the most as low interest
rates globally and Brexit-induced uncertainty weighed on the earnings
outlook for many financial companies.
Developed non-U.S. stock markets fell sharply over the year. The MSCI
EAFE Index, which measures the performance of stocks in Europe,
Australasia, and the Far East, returned -9.72%. In U.S. dollar terms,
almost every market in developed Asia and Europe declined. Emerging
markets stocks fared even worse than developed markets. All major
emerging regions retreated amid concerns including the impact of lower
oil prices on commodity-dependent countries, China’s management of
its slowing economy, and political instability in a few countries.
Bonds Benefit From Post-Brexit Uncertainty
U.S. investment-grade bonds produced solid returns over the past year.
Uneven U.S. economic data and Brexit-induced uncertainty spurred
demand for Treasuries, pushing the yield on the benchmark 10-year
note down to near-record lows at the end of June. Longer-term
GLOBAL MARKET RETURNS AS OF 6/30/16 (%)
Periods ended 6/30/16
¢¢ 6-month return
6.00
„„ 12-month return
3.84
5.31
3.99
Russell 2000 Index
2.22
Nasdaq Composite Index*
MSCI EAFE Index
S&P 500 Index
Barclays U.S. Aggregate
Bond Index
-3.29
-2.89
-4.04
-6.73
-9.72
*Principal return only.
Russell Investment Group is the source and owner of the trademarks, service marks, and copyrights related to the Russell indexes. Russell is a trademark of Russell Investment Group.
MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further
­redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, reviewed, or produced by MSCI.
4
hikes attracted strong investor demand. Dollar-denominated emerging
markets debt outperformed local currency bonds, which were hurt
by currency weakness versus the dollar. Almost all global currencies
weakened against the dollar with the exception of the Japanese yen,
which surged roughly 19% against the dollar over the past year on
safe-haven demand.
Treasuries surged as ultralow or negative interest rates in Europe and
Japan prompted foreign investors to favor the added yield on U.S.
government debt and investors sought safe-haven investments after
the Brexit vote. Corporate bonds did well, while mortgage- and assetbacked securities trailed with moderate gains.
High yield corporate bonds lagged investment-grade corporates but
still produced positive returns. Commodities weakness for much of last
year weighed on the natural resources companies that make up a large
proportion of the high yield market, but the overall market rebounded
with commodity prices in the last few months.
Bonds in developed non-U.S. markets produced strong returns in dollar
terms as central banks in Japan and the eurozone continued to buy
bonds and push interest rates lower—in some cases, into negative
territory. At the end of our fiscal year, uncertainty after Brexit drove
bond yields in many developed countries deeper into negative territory.
Dollar-denominated emerging markets debt generated positive returns
as their relatively high yields and reduced expectations for Fed rate
INTEREST RATE LEVELS (%)
¢¢ 10-year Treasury note
„„ 5-year Treasury note
„„ 90-day Treasury bill
3.0
2.5
2.0
1.5
1.0
0.5
0.0
6/15
7/15
8/15
9/15
10/15
11/15
12/15
1/16
2/16
3/16
4/16
5/16
6/16
Definitions of the benchmarks cited in this report:
Bank of America Merrill Lynch U.S. High Yield Master II Index—tracks the performance of U.S. dollar-denominated below investment-grade corporate debt issued in the U.S.; Barclays 1–3 Year
Government/Credit Bond Index—tracks short-term debt instruments; Barclays 1–5 Year U.S. Treasury TIPS Index—measures the performance of inflation protected obligations of the U.S. Treasury
with maturities of 1 to 5 years; Barclays U.S. Aggregate Bond Index—tracks investment-grade corporate and government bonds; Citigroup 3-Month Treasury Bill Index—tracks short-term U.S.
government debt instruments; Morningstar Financial—tracks funds that invest primarily in equity securities of financial services companies; Morningstar Health—tracks funds that invest primarily
in equity securities of health care companies; Morningstar Specialty Technology—tracks funds that invest primarily in equity securities of technology companies; MSCI All Country (AC) World Index
ex USA—measures equity market performance of developed and emerging countries, excluding the U.S.; MSCI EAFE Index—tracks the stocks of about 1,000 companies in Europe, Australasia, and
the Far East (EAFE); Nasdaq Composite Index—tracks U.S. stocks traded in the over-the-counter market; Russell 1000 Index—tracks the performance of the 1,000 largest U.S. companies; Russell
1000 Growth Index—tracks the Russell 1000 companies with higher price-to-book ratios and higher forecast growth values; Russell 1000 Value Index—tracks the Russell 1000 companies with
lower price-to-book ratios and lower forecast growth values; Russell 2000 Index—tracks the stocks of 2,000 small-cap U.S. companies; Russell 2000 Growth Index—tracks the Russell 2000 companies with higher price-to-book ratios and higher forecast growth values; Russell 3000 Index—measures the performance of the 3,000 largest U.S. companies representing approximately 98% of
the investable U.S. equity market; Russell Midcap Value Index—tracks the performance of mid-cap stocks with lower price-to-book ratios and lower forecast growth values; S&P 500 Index—tracks
the stocks of 500 primarily large-cap U.S. companies. It is not possible to invest in an index.
5
Long-term returns*
JOHN HANCOCK FREEDOM 529 INVESTMENT PERFORMANCE
Performance information for each of the John Hancock Freedom 529 Investment Options as of June 30, 2016, follows. For more recent performance,
please visit johnhancockfreedom529.com or contact your financial advisor. Current performance may be higher or lower than that quoted. As always,
past performance cannot guarantee future results.
Average annual total returns as of 6/30/16
Without a sales charge (%)
ENROLLMENT-BASED
Portfolio 2033–2036
Class A1
Class C24
Portfolio 2029–2032
Class A1
Class B3
Class C24
Portfolio 2025–2028
Class A2
Class B3
Class C24
Portfolio 2021–2024
Class A2
Class B3
Class C24
Portfolio 2017–2020
Class A1
Class A2 (effective 6/3/02)
Class B3
Class C4
Class C24
College Portfolio
Class A1
Class A2 (effective 6/3/02)
Class B3
Class C4
Class C24
With a sales charge (%)
1 year
3 years
5 years
10 years
ITD
1 year
3 years
5 years
10 years
ITD
Inception
date
-2.65
-3.37
N/A
N/A
N/A
N/A
N/A
N/A
-4.15
-4.88
-7.52
-3.37
N/A
N/A
N/A
N/A
N/A
N/A
-8.56
-4.88
5/29/15
5/29/15
-2.63
-3.36
-3.35
7.26
6.44
6.46
7.65
6.82
6.85
N/A
N/A
N/A
6.84
6.02
6.05
-7.50
-7.22
-3.35
5.35
5.55
6.46
6.49
6.66
6.85
N/A
N/A
N/A
5.73
5.87
6.05
4/29/11
4/29/11
4/29/11
-1.44
-2.16
-2.16
7.18
6.39
6.39
7.44
6.64
6.65
N/A
N/A
N/A
4.54
3.77
3.76
-6.37
-6.07
-2.16
5.27
5.50
6.39
6.29
6.49
6.65
N/A
N/A
N/A
3.92
3.77
3.76
4/30/07
4/30/07
4/30/07
0.00
-0.71
-0.72
6.46
5.67
5.69
6.63
5.84
5.85
5.29
4.49
4.49
7.56
5.96
6.71
-5.00
-4.68
-0.72
4.57
4.77
5.69
5.49
5.68
5.85
4.73
4.49
4.49
7.12
5.96
6.71
4/30/03
9/30/03
4/30/03
1.27
1.27
0.49
0.98
0.52
5.66
5.66
4.87
5.38
4.86
5.78
5.78
4.98
5.51
4.99
5.23
5.23
4.42
4.95
4.42
4.65
5.73
5.86
4.38
6.96
-2.27
-3.79
-3.51
0.98
0.52
4.41
3.78
3.96
5.38
4.86
5.03
4.65
4.82
5.51
4.99
4.85
4.66
4.42
4.95
4.42
4.40
5.33
5.86
4.38
6.96
7/2/01
7/2/01
9/30/03
7/2/01
9/30/02
1.85
1.85
1.13
1.63
1.06
3.06
3.06
2.30
2.81
2.30
3.17
3.17
2.41
2.92
2.40
4.19
4.19
3.39
3.93
3.39
3.86
4.07
3.32
3.59
3.59
-1.72
-3.25
-2.87
1.63
1.06
1.85
1.23
1.34
2.81
2.30
2.44
2.07
2.22
2.92
2.40
3.82
3.63
3.39
3.93
3.39
3.61
3.67
3.32
3.59
3.59
7/2/01
7/2/01
9/30/03
7/2/01
9/30/02
-3.72
-4.44
-4.45
5.67
4.88
4.90
5.55
4.78
4.78
4.51
3.73
3.69
4.51
3.73
3.69
-8.53
-8.26
-4.45
3.79
3.96
4.90
4.42
4.61
4.78
3.94
3.73
3.69
3.94
3.73
3.69
6/30/06
6/30/06
6/30/06
-1.88
-2.62
-2.62
4.87
4.06
4.08
4.98
4.21
4.20
4.59
3.79
3.79
4.59
3.79
3.79
-6.79
-6.51
-2.62
3.00
3.12
4.08
3.86
4.04
4.20
4.02
3.79
3.79
4.02
3.79
3.79
6/30/06
6/30/06
6/30/06
0.32
-0.41
-0.41
4.07
3.29
3.31
4.54
3.75
3.76
4.73
3.91
3.94
4.73
3.91
3.94
-4.70
-4.39
-0.41
2.21
2.35
3.31
3.42
3.58
3.76
4.17
3.91
3.94
4.17
3.91
3.94
6/30/06
6/30/06
6/30/06
LIFESTYLE
Lifestyle Growth 529
Class A2
Class B3
Class C24
Lifestyle Balanced 529
Class A2
Class B3
Class C24
Lifestyle Moderate 529
Class A2
Class B3
Class C24
*The long-term returns are annualized through June 30, 2016. However, if a portfolio has less than 1 year of performance history, the since-inception (ITD) figure is not annualized and represents a
cumulative total return.
6
Average annual total returns as of 6/30/16
Without a sales charge (%)
STATIC
Future Trends Portfolio
Class A1
Class A2 (effective 6/3/02)
Class B3
Class C4
Class C24
Equity Portfolio
Class A1
Class A2 (effective 6/3/02)
Class B3
Class C4
Class C24
Fixed Income Portfolio
Class A1
Class A2 (effective 6/3/02)
Class B3
Class C4
Class C24
Short-Term Bond Portfolio
Class A1
Class A2 (effective 6/3/02)
Class B3
Class C4
Class C24
With a sales charge (%)
1 year
3 years
5 years
10 years
ITD
1 year
3 years
5 years
10 years
ITD
Inception
date
-7.32
-7.32
-8.01
-7.56
-8.02
13.59
13.59
12.75
13.31
12.76
13.28
13.28
12.46
13.01
12.45
9.30
9.30
8.46
9.02
8.46
6.91
9.03
8.56
6.61
10.34
-10.57
-11.96
-11.69
-7.56
-8.02
12.25
11.57
11.96
13.31
12.76
12.48
12.07
12.34
13.01
12.45
8.91
8.71
8.46
9.02
8.46
6.66
8.61
8.56
6.61
10.34
7/2/01
7/2/01
9/30/03
7/2/01
9/30/02
-2.93
-2.93
-3.66
-3.18
-3.66
7.14
7.14
6.34
6.87
6.34
7.50
7.50
6.70
7.25
6.70
5.94
5.94
5.13
5.67
5.12
5.15
6.24
6.43
4.89
7.51
-6.32
-7.78
-7.51
-3.18
-3.66
5.87
5.23
5.45
6.87
6.34
6.74
6.35
6.54
7.25
6.70
5.56
5.37
5.13
5.67
5.12
4.90
5.84
6.43
4.89
7.51
7/2/01
7/2/01
9/30/03
7/2/01
9/30/02
4.40
4.40
3.62
4.13
3.62
3.45
3.45
2.69
3.20
2.67
3.42
3.42
2.64
3.16
2.63
5.25
5.25
4.44
4.98
4.44
5.35
5.18
4.05
5.06
4.39
0.75
0.22
-0.38
4.13
3.62
2.23
1.61
1.73
3.20
2.67
2.68
2.31
2.46
3.16
2.63
4.88
4.68
4.44
4.98
4.44
5.10
4.78
4.05
5.06
4.39
7/2/01
7/2/01
9/30/03
7/2/01
9/30/02
1.08
1.08
0.35
0.82
0.34
0.66
0.66
-0.09
0.43
-0.08
0.64
0.64
-0.10
0.39
-0.12
2.28
2.28
1.50
2.03
1.51
2.40
2.23
1.18
2.14
1.31
-2.46
-2.97
-3.65
0.82
0.34
-0.53
-1.13
-1.10
0.43
-0.08
-0.07
-0.44
-0.30
0.39
-0.12
1.92
1.73
1.50
2.03
1.51
2.15
1.83
1.18
2.14
1.31
7/2/01
7/2/01
9/30/03
7/2/01
9/30/02
10.93
10.11
10.12
12.36
11.51
11.52
9.93
9.08
9.08
10.74
9.87
9.90
-7.62
-7.34
-3.47
8.96
9.28
10.12
11.15
11.38
11.52
9.34
9.08
9.08
10.23
9.87
9.90
9/30/04
9/30/04
9/30/04
-0.23
-0.97
-0.97
-0.53
-1.29
-1.29
N/A
N/A
N/A
-1.74
-2.45
-2.47
-16.03
-15.78
-12.28
-2.01
-1.97
-0.97
-1.59
-1.48
-1.29
N/A
N/A
N/A
-2.36
-2.45
-2.47
11/30/07
11/30/07
11/30/07
7.97
7.17
7.17
9.32
8.51
8.51
7.72
6.89
6.87
10.29
8.67
9.39
-7.67
-7.37
-3.55
6.05
6.29
7.17
8.15
8.36
8.51
7.14
6.89
6.87
9.84
8.67
9.39
4/30/03
9/30/03
4/30/03
10.58
9.76
9.75
10.25
9.43
9.43
7.94
7.10
7.11
11.20
9.08
10.30
-1.71
-1.32
2.69
8.61
8.92
9.75
9.07
9.29
9.43
7.36
7.10
7.11
10.76
9.08
10.30
9/30/02
9/30/03
9/30/02
12.08
11.25
11.24
10.26
9.45
9.44
N/A
N/A
N/A
6.39
5.61
5.61
-9.67
-9.39
-5.67
10.09
10.43
11.24
9.07
9.31
9.44
N/A
N/A
N/A
5.72
5.61
5.61
11/30/07
11/30/07
11/30/07
12.41
11.57
11.57
12.15
11.32
11.32
8.11
7.30
7.29
9.30
7.35
8.43
-7.05
-6.79
-2.90
10.41
10.76
11.57
10.95
11.19
11.32
7.53
7.30
7.29
8.87
7.35
8.43
9/30/02
9/30/03
9/30/02
INDIVIDUAL
New Horizons Portfolio
Class A2
-2.76
-3.48
Class B3
-3.47
Class C24
International Value Portfolio
Class A2
-11.61
Class B3
-12.27
-12.28
Class C24
Small-Cap Stock Portfolio
Class A2
-2.81
-3.51
Class B3
-3.55
Class C24
Mid-Cap Value Portfolio
3.46
Class A2
Class B3
2.68
Class C24
2.69
Capital Appreciation Portfolio
-4.92
Class A2
Class B3
-5.61
Class C24
-5.67
Blue Chip Growth Portfolio
-2.16
Class A2
Class B3
-2.91
Class C24
-2.90
7
Average annual total returns as of 6/30/16
Without a sales charge (%)
INDIVIDUAL
Equity Income Portfolio
Class A2
Class B3
Class C24
American Mutual Portfolio
Class A2
Class B3
Class C24
With a sales charge (%)
1 year
3 years
5 years
10 years
ITD
1 year
3 years
5 years
10 years
ITD
Inception
date
0.76
-0.05
-0.04
6.19
5.38
5.38
8.45
7.63
7.63
5.15
4.34
4.34
7.22
5.90
6.35
-4.27
-4.05
-0.04
4.30
4.47
5.38
7.29
7.48
7.63
4.58
4.34
4.34
6.78
5.90
6.35
4/30/03
9/30/03
4/30/03
5.88
5.05
5.08
9.81
8.97
8.99
10.16
9.33
9.34
6.59
5.76
5.77
7.79
6.55
6.95
0.58
1.05
5.08
7.85
8.12
8.99
8.98
9.19
9.34
6.02
5.76
5.77
7.35
6.55
6.95
4/30/03
9/30/03
4/30/03
7 day compound yield5
Inception
date
Average annual total returns as of 6/30/16
Without a sales charge (%)
STATIC
Total return (%)
7 day simple yield5
1 year
3 years
5 years
10 years
ITD
0.00
0.00
0.00
0.84
1.06
0.00
0.00
9/30/04
0.00
8/29/14
0.00
8/29/14
Money Market Portfolio5
Original Money
Market Portfolio
Class A
0.00
N/A
N/A
N/A
0.00
0.00
Class C24
0.00
N/A
N/A
N/A
0.00
0.00
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may
be higher or lower than the performance quoted. Investment returns in John Hancock Freedom 529 portfolios and the value of an investor’s units
will fluctuate and may be worth more or less than original cost when redeemed.
1 Performance with a sales charge reflects a 3.5% maximum sales charge for units purchased prior to June 3, 2002.
2 Performance with a sales charge reflects a 5.25% maximum sales charge for units purchased from on or after June 3, 2002, until September 2, 2014, unless grandfather
rules apply. Please see plan disclosure document for additional details. Performance with a sales charge reflects a 5.00% (4.00% for Short-Term Bond and Fixed Income
Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
3 All Class B portfolios carry a 6-year contingent deferred sales charge or CDSC (maximum of 5%, declining over 6 years). Class B returns with a sales charge reflect the
applicable sales charge for the period shown. Class B units of each portfolio are charged an annual program management fee of 0.25%, an annual Trust fee of 0.05%
and an annual distribution and service fee of 0.25%.
4 Class C2 units do not have a sales charge. For Accounts established on or after October 1, 2002, Class C units are referred to as Class C2.
5 The Trustee has authorized the Program Manager to waive all or a portion of the annual program management fee for the Money Market Portfolio to the extent
necessary to maintain the respective net yield of the Original Money Market Portfolio, Money Market Portfolio Class A, and Money Market Portfolio Class C2 at 0.0% or
above. The fee waiver has the effect of increasing the portfolio’s net yield. Without this waiver, the yield on the portfolio could be lower. An investment in the Money
Market Portfolio is not insured or guaranteed by the FDIC or any other government agency. Although the portfolio seeks to preserve the value of your investment at
$1.00 per unit, it is possible to lose money by investing in the portfolio.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual
funds in which the portfolio invests. Performance does not reflect the annual account maintenance fee of $25. If it were reflected, performance
would be lower.
The performance of the enrollment-based Investment Options reflects changes in asset allocations over time relating to the targeted college
enrollment date of Beneficiaries for which the particular Investment Option is designed. Assets are automatically moved to the College Portfolio in
the second quarter of the third year in the title of the Investment Option and may not remain invested in the referenced Investment Option for a
portion of the period reported.
8
Portfolio highlights—Enrollment-based portfolios
PORTFOLIO 2033–2036
Portfolio 2033–2036 generated a negative return and underperformed its weighted benchmark for the 12-month period ended June 30, 2016.
Because the portfolio is focused on long-term capital appreciation, its assets are primarily held in a diversified selection of growth and value funds invested in the
stocks of companies based in the U.S. and international developed and emerging markets. Later in the portfolio’s life cycle, it will incorporate more lower-volatility, fixed
income investments.
Overall, security selection in the underlying funds detracted from relative performance. The John Hancock II Capital Appreciation Fund and John Hancock Disciplined
Value Fund underperformed their style-specific benchmarks, as did the T. Rowe Price Blue Chip Growth Fund and T. Rowe Price Equity Income Fund. Conversely, the
John Hancock International Growth Fund and T. Rowe Price New Horizons Fund outperformed their respective benchmarks.
The portfolio’s inclusion of diversifying sectors—particularly through the T. Rowe Price Real Assets Fund—contributed to relative returns. The fund invests in securities
of companies that are engaged in activities related to real assets, such as commodities, real estate, energy, and natural resources. Exposure to real assets equities lifted
relative results as oil, metal, and agricultural commodity prices rallied and real estate investment trusts posted solid returns.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class C2
Weighted Benchmark2
Asset class breakdown
6 months
-3.79
1.27
0.96
2.34
12 months
-7.52
-2.65
-3.37
-1.56
6/30/15
6/30/16
■ Equity
100%
100%
Portfolio composition (%)
As percent of net assets
T. Rowe Price Blue Chip Growth Fund
T. Rowe Price Equity Income Fund
John Hancock II Capital Appreciation Fund (subadvised by Jennison)
T. Rowe Price Mid-Cap Value Fund
T. Rowe Price New Horizons Fund
John Hancock Disciplined Value Fund (subadvised by Boston Partners)
John Hancock International Growth Fund (subadvised by Wellington)
John Hancock II International Value Fund (subadvised by Templeton)
John Hancock Disciplined Value International Fund (subadvised by Boston Partners)
Oppenheimer International Growth Fund
T. Rowe Price Real Assets Fund
John Hancock II Emerging Markets Fund (subadvised by Dimensional Fund Advisors)
American Mutual Fund
6/30/15
6/30/16
15.5
14.3
10.4
8.0
7.4
7.5
6.0
6.0
6.0
6.0
4.9
4.3
3.7
15.1
14.6
10.1
8.1
7.6
7.4
6.1
5.9
5.9
5.8
5.2
4.4
3.8
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
2As of June 30, 2016, the weighted benchmark is composed of: Russell 3000 Index—70.00% and MSCI AC World Index ex USA—30.00%.
9
PORTFOLIO 2029–2032
Portfolio 2029–2032 generated a negative return and underperformed its weighted benchmark for the 12-month period ended June 30, 2016.
Because the portfolio is focused on long-term capital appreciation, its assets are primarily held in a diversified selection of growth and value funds invested in the
stocks of companies based in the U.S. and international developed and emerging markets. Later in the portfolio’s life cycle, it will incorporate more lower-volatility, fixed
income investments.
Overall, security selection in the underlying funds detracted from relative performance. The John Hancock II Capital Appreciation Fund and John Hancock Disciplined
Value Fund underperformed their style-specific benchmarks, as did the T. Rowe Price Blue Chip Growth Fund and T. Rowe Price Equity Income Fund. Conversely, the
John Hancock International Growth Fund and T. Rowe Price New Horizons Fund outperformed their respective benchmarks.
The portfolio’s inclusion of diversifying sectors—particularly through the T. Rowe Price Real Assets Fund—contributed to relative returns. The fund invests in securities
of companies that are engaged in activities related to real assets, such as commodities, real estate, energy, and natural resources. Exposure to real assets equities lifted
relative results as oil, metal, and agricultural commodity prices rallied and real estate investment trusts posted solid returns.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C2
Weighted benchmark2
Asset class breakdown
6 months
-3.77
1.29
-4.11
0.89
0.97
2.34
12 months
-7.50
-2.63
-7.22
-3.36
-3.35
-1.56
6/30/15
6/30/16
100%
100%
■ Equity
Portfolio composition (%)
As percent of net assets
T. Rowe Price Blue Chip Growth Fund
T. Rowe Price Equity Income Fund
John Hancock II Capital Appreciation Fund (subadvised by Jennison)
T. Rowe Price Mid-Cap Value Fund
T. Rowe Price New Horizons Fund
John Hancock Disciplined Value Fund (subadvised by Boston Partners)
John Hancock International Growth Fund (subadvised by Wellington)
John Hancock II International Value Fund (subadvised by Templeton)
John Hancock Disciplined Value International Fund (subadvised by Boston Partners)
Oppenheimer International Growth Fund
T. Rowe Price Real Assets Fund
John Hancock II Emerging Markets Fund (subadvised by Dimensional Fund Advisors)
American Mutual Fund
6/30/15
6/30/16
15.6
14.2
10.5
8.0
7.6
7.5
6.0
5.9
6.0
6.1
4.8
4.1
3.7
15.1
14.6
10.1
8.1
7.6
7.4
6.1
6.0
5.8
5.8
5.2
4.4
3.8
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
2As of June 30, 2016, the weighted benchmark is composed of: Russell 3000 Index—70.00% and MSCI AC World Index ex USA—30.00%.
10
PORTFOLIO 2025–2028
Portfolio 2025–2028 generated a negative return and underperformed its weighted benchmark for the 12-month period ended June 30, 2016.
Because the portfolio is focused on long-term capital appreciation, its assets are primarily held in a diversified selection of growth and value funds invested in the stocks
of companies based in the U.S. and international developed and emerging markets. The portfolio also includes an allocation to lower-volatility, fixed income funds.
Overall, security selection in the underlying funds detracted from relative performance. The John Hancock II Capital Appreciation Fund and John Hancock Disciplined
Value Fund underperformed their style-specific benchmarks, as did the T. Rowe Price Blue Chip Growth Fund and T. Rowe Price Equity Income Fund. Conversely, the
John Hancock International Growth Fund and T. Rowe Price New Horizons Fund outperformed their respective benchmarks.
The portfolio’s inclusion of diversifying sectors—particularly through the T. Rowe Price Real Assets Fund—contributed to relative returns. The fund invests in securities
of companies that are engaged in activities related to real assets, such as commodities, real estate, energy, and natural resources. Exposure to real assets equities lifted
relative results as oil, metal, and agricultural commodity prices rallied and real estate investment trusts posted solid returns.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C2
Weighted benchmark2
Asset class breakdown
6 months
-3.00
2.11
-3.26
1.74
1.74
2.98
12 months
-6.37
-1.44
-6.07
-2.16
-2.16
-0.20
6/30/15
6/30/16
■ Fixed Income
■ Equity
20.2%
15.1%
84.9%
79.8%
Portfolio composition (%)
As percent of net assets
T. Rowe Price Blue Chip Growth Fund
T. Rowe Price Equity Income Fund
T. Rowe Price Spectrum Income Fund
John Hancock II Capital Appreciation Fund (subadvised by Jennison)
John Hancock II Core Bond Fund (subadvised by Wells Capital Management)
T. Rowe Price Mid-Cap Value Fund
T. Rowe Price New Horizons Fund
John Hancock Disciplined Value Fund (subadvised by Boston Partners)
John Hancock International Growth Fund (subadvised by Wellington)
John Hancock II International Value Fund (subadvised by Templeton)
Oppenheimer International Growth Fund
John Hancock Disciplined Value International Fund (subadvised by Boston Partners)
T. Rowe Price Real Assets Fund
John Hancock II Emerging Markets Fund (subadvised by Dimensional Fund Advisors)
American Mutual Fund
John Hancock II Strategic Income Opportunities Fund (subadvised by JHAM)
6/30/15
6/30/16
13.2
12.1
7.6
9.0
5.6
6.8
6.4
6.4
5.1
5.0
5.2
5.1
4.0
3.5
3.1
1.9
12.0
11.6
10.2
8.0
7.6
6.5
6.1
5.9
4.9
4.7
4.7
4.6
4.1
3.5
3.1
2.5
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
2As of June 30, 2016, the weighted benchmark is composed of: Russell 3000 Index—56.00%, MSCI AC World Index ex USA—24.00%, and Barclays U.S. Aggregate Bond Index—20.00%.
11
PORTFOLIO 2021–2024
Portfolio 2021–2024 generated a flat return and underperformed its weighted benchmark for the 12-month period ended June 30, 2016.
The portfolio is systematically increasing its allocation to lower-volatility, fixed income investments as part of its long-term strategy of becoming more conservative over
time. At the end of the fiscal year, almost 60% of the portfolio’s holdings were in a diversified selection of growth and value funds invested in the stocks of companies
based in the U.S. and international developed and emerging markets. Approximately 40% of the portfolio was invested in fixed income holdings.
Overall, security selection in the underlying funds detracted from relative performance. The John Hancock II Capital Appreciation Fund and John Hancock Disciplined
Value Fund underperformed their style-specific benchmarks, as did the T. Rowe Price Blue Chip Growth Fund, T. Rowe Price Spectrum Income Fund, and T. Rowe Price
Equity Income Fund. Conversely, the John Hancock International Growth Fund and T. Rowe Price New Horizons Fund outperformed their respective benchmarks.
The portfolio’s inclusion of diversifying sectors—particularly through the T. Rowe Price Real Assets Fund—contributed to relative returns. The fund invests in securities
of companies that are engaged in activities related to real assets, such as commodities, real estate, energy, and natural resources. Exposure to real assets equities lifted
relative results as oil, metal, and agricultural commodity prices rallied and real estate investment trusts posted solid returns.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C2
Weighted benchmark2
Asset class breakdown
6 months
-2.11
3.04
-2.35
2.65
2.66
3.64
12 months
-5.00
0.00
-4.68
-0.71
-0.72
1.44
6/30/15
6/30/16
■ Fixed Income
■ Equity
35.7%
41.4%
58.6%
64.3%
Portfolio composition (%)
As percent of net assets
T. Rowe Price Spectrum Income Fund
John Hancock II Core Bond Fund (subadvised by Wells Capital Management)
T. Rowe Price Blue Chip Growth Fund
T. Rowe Price Equity Income Fund
John Hancock II Capital Appreciation Fund (subadvised by Jennison)
John Hancock II Strategic Income Opportunities Fund (subadvised by JHAM)
T. Rowe Price Mid-Cap Value Fund
T. Rowe Price New Horizons Fund
John Hancock Disciplined Value Fund (subadvised by Boston Partners)
John Hancock International Growth Fund (subadvised by Wellington)
John Hancock Disciplined Value International Fund (subadvised by Boston Partners)
John Hancock II International Value Fund (subadvised by Templeton)
Oppenheimer International Growth Fund
T. Rowe Price Real Assets Fund
John Hancock II Emerging Markets Fund (subadvised by Dimensional Fund Advisors)
American Mutual Fund
6/30/15
6/30/16
17.8
13.4
10.0
9.1
6.7
4.5
5.2
4.8
4.9
3.9
3.9
3.8
3.9
3.0
2.7
2.4
20.8
15.6
8.8
8.5
5.8
5.1
4.7
4.5
4.4
3.6
3.5
3.4
3.4
3.0
2.6
2.3
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
2As of June 30, 2016, the weighted benchmark is composed of: Russell 3000 Index—41.30%, Barclays U.S. Aggregate Bond Index—41.00%, MSCI All Country World Index ex USA—17.70%
12
PORTFOLIO 2017–2020
Portfolio 2017–2020 generated a positive return but underperformed its weighted benchmark for the 12-month period ended June 30, 2016.
The portfolio is systematically increasing its allocation to lower-volatility, fixed income investments as part of its long-term strategy of becoming more conservative over
time. At the end of the fiscal year, almost two-thirds of the portfolio was invested in fixed income holdings, with the balance in a diversified selection of growth and
value funds invested in the stocks of companies based in the U.S. and international developed and emerging markets.
Overall, security selection in the underlying funds detracted from relative performance. The John Hancock II Capital Appreciation Fund and John Hancock Disciplined
Value Fund underperformed their style-specific benchmarks, as did the T. Rowe Price Blue Chip Growth Fund, T. Rowe Price Spectrum Income Fund, and T. Rowe Price
Equity Income Fund. Conversely, the John Hancock International Growth Fund and T. Rowe Price New Horizons Fund outperformed their respective benchmarks.
The portfolio’s inclusion of diversifying sectors—particularly through the T. Rowe Price Real Assets Fund—contributed to relative returns. The fund invests in securities
of companies that are engaged in activities related to real assets, such as commodities, real estate, energy, and natural resources. Exposure to real assets equities lifted
relative results as oil, metal, and agricultural commodity prices rallied and real estate investment trusts posted solid returns.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
(issues before June 3, 2002)
Class A, including sales charge
(issues on or after June 3, 2002)
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C
Class C2
Weighted Benchmark2
Asset class breakdown
6 months
-0.31
12 months
-2.27
-1.86
-3.79
3.30
-2.11
2.89
3.12
2.90
4.20
1.27
-3.51
0.49
0.98
0.52
3.16
6/30/15
6/30/16
■ Fixed Income
■ Equity
42.6%
36.9%
57.4%
63.1%
Portfolio composition (%)
As percent of net assets
T. Rowe Price Spectrum Income Fund
John Hancock II Core Bond Fund (subadvised by Wells Capital Management)
T. Rowe Price Limited Duration Inflation Focused Bond Fund (formerly the Inflation Focused Bond Fund)3
T. Rowe Price Blue Chip Growth Fund
T. Rowe Price Equity Income Fund
John Hancock II Strategic Income Opportunities Fund (subadvised by JHAM)
John Hancock II Capital Appreciation Fund (subadvised by Jennison)
John Hancock Disciplined Value Fund (subadvised by Boston Partners)
American Mutual Fund
T. Rowe Price Real Assets Fund
John Hancock International Growth Fund (subadvised by Wellington)
John Hancock Disciplined Value International Fund (subadvised by Boston Partners)
John Hancock II International Value Fund (subadvised by Templeton)
Oppenheimer International Growth Fund
T. Rowe Price Mid-Cap Value Fund
T. Rowe Price New Horizons Fund
John Hancock II Emerging Markets Fund (subadvised by Dimensional Fund Advisors)
6/30/15
6/30/16
25.0
18.8
7.3
8.3
7.5
6.3
5.5
4.0
2.0
2.0
2.0
2.0
2.0
2.1
2.3
2.1
0.8
25.2
18.8
12.9
7.6
7.4
6.2
5.1
3.8
2.0
1.9
1.5
1.5
1.5
1.4
1.4
1.4
0.4
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
2As of June 30, 2016, the weighted benchmark is composed of: Barclays U.S. Aggregate Bond Index—50.00%, Russell 3000 Index—30.35%, Barclays U.S. 1–5 Year Treasury TIPS Index—
13.00%, MSCI All Country World Index ex USA—6.65%.
3The T. Rowe Price Inflation Focused Bond Fund was renamed the T. Rowe Price Limited Duration Inflation Focused Bond Fund on September 29, 2015.
13
COLLEGE PORTFOLIO
The College Portfolio generated a positive return but underperformed its weighted benchmark for the 12-month period ended June 30, 2016.
The portfolio invests in a diversified blend of bonds and conservative fixed income securities, representing about 80% of assets. It also holds a 20% allocation in
equities. This structure should allow investors to generate growth in their college savings accounts while minimizing the risk of principal loss through a combination of
diversification and conservative fixed income investments.
Overall, security selection in the underlying funds detracted from relative performance. The T. Rowe Price Spectrum Income Fund underperformed its style-specific benchmark,
the Barclays U.S. Aggregate Bond Index, due to security selection in some of the underlying portfolios. The John Hancock II Capital Appreciation Fund and T. Rowe Price Blue
Chip Growth Fund and T. Rowe Price Limited Duration Inflation Focused Bond Fund (formerly the Inflation Focused Bond Fund) lagged their respective benchmarks.
The portfolio’s inclusion of diversifying sectors—particularly through the T. Rowe Price Real Assets Fund—contributed to relative returns. The fund invests in securities
of companies that are engaged in activities related to real assets, such as commodities, real estate, energy, and natural resources. Exposure to real assets equities lifted
relative results as oil, metal, and agricultural commodity prices rallied and real estate investment trusts posted solid returns.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
(issues before June 3, 2002)
Class A, including sales charge
(issues on or after June 3, 2002)
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C
Class C2
Weighted Benchmark2
Asset class breakdown
6 months
-0.34
12 months
-1.72
-1.89
-3.25
3.28
-2.08
2.92
3.16
2.85
4.08
1.85
-2.87
1.13
1.63
1.06
3.47
6/30/15
6/30/16
■ Fixed Income
■ Equity
19.8%
19.7%
80.3%
80.2%
Portfolio composition (%)
As percent of net assets
T. Rowe Price Limited Duration Inflation Focused Bond Fund (formerly the Inflation Focused Bond Fund)3
T. Rowe Price Spectrum Income Fund
John Hancock II Core Bond Fund (subadvised by Wells Capital Management)
John Hancock II Strategic Income Opportunities Fund (subadvised by JHAM)
T. Rowe Price Blue Chip Growth Fund
T. Rowe Price Equity Income Fund
John Hancock II Capital Appreciation Fund (subadvised by Jennison)
John Hancock Disciplined Value Fund (subadvised by Boston Partners)
American Mutual Fund
T. Rowe Price Real Assets Fund
John Hancock II International Value Fund (subadvised by Templeton)
Oppenheimer International Growth Fund
John Hancock International Growth Fund (subadvised by Wellington)
John Hancock Disciplined Value International Fund (subadvised by Boston Partners)
6/30/15
6/30/16
40.3
19.9
15.0
5.0
5.1
4.7
3.4
2.5
1.2
0.9
0.5
0.5
0.5
0.5
40.0
20.2
15.1
5.1
5.0
4.8
3.3
2.5
1.3
1.0
0.5
0.4
0.4
0.4
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
2As of June 30, 2016, the weighted benchmark is composed of: Barclays U.S. 1–5 Year Treasury TIPS Index—40.00%, Barclays U.S. Aggregate Bond Index—40.00%, Russell 3000 Index—
18.00%, and MSCI AC World Index ex USA—2.00%.
3The T. Rowe Price Inflation Focused Bond Fund was renamed the T. Rowe Price Limited Duration Inflation Focused Bond Fund on September 29, 2015.
14
Portfolio highlights—Static portfolios
FUTURE TRENDS PORTFOLIO
The Future Trends Portfolio is composed of the T. Rowe Price Science & Technology Fund, T. Rowe Price Health Sciences Fund, and T. Rowe Price Financial Services
Fund—areas within the broad market that are expected to provide products and services that drive the future economy. During the 12-month period ended
June 30, 2016, the portfolio generated a negative return. The portfolio outperformed its weighted Morningstar benchmark, which is composed of roughly equal
allocations to the Morningstar Technology Index, Morningstar Health Funds Index, and Morningstar Financial Index.
The T. Rowe Price Science & Technology Fund generated a positive return for the reporting period, lifted by positioning in the software and Internet industries. On the
other hand, the T. Rowe Price Health Sciences Fund declined significantly due to weakness in the biotechnology and pharmaceuticals segments.
The Financial Services Fund generated a negative return. Financial companies grappled with myriad concerns, including nonperforming loans to energy companies,
difficult trading conditions in early 2016, and low interest rates globally. June’s Brexit vote dealt the latest blow to the sector as investors worried that the decision
would hurt growth in the UK and Europe and push central banks to further ease monetary policy, which would threaten the profitability and stability of many financial
companies. UK and European banks were among the hardest-hit names following Brexit.
All three underlying funds share a common strategic approach: They seek to hold the best growth prospects among companies with strong fundamental underpinnings.
Performance comparison as of 6/30/161 (%)
Asset class breakdown
Class
Class A, including sales charge
(issues before June 3, 2002)
Class A, including sales charge
(issues on or after June 3, 2002)
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C
Class C2
Weighted Benchmark2
6 months
-7.70
12 months
-10.57
-9.14
-11.96
-4.35
-9.45
-4.69
-4.48
-4.68
-5.49
-7.32
-11.69
-8.01
-7.56
-8.02
-8.55
6/30/15
6/30/16
100%
100%
■ Equity
Portfolio composition (%)
As percent of net assets
T. Rowe Price Science & Technology Fund
T. Rowe Price Health Sciences Fund
T. Rowe Price Financial Services Fund
6/30/15
6/30/16
32.7
33.7
33.6
34.9
32.7
32.4
Top five holdings of each underlying fund as of 6/30/16 (%)
T. Rowe Price Health Sciences Fund
UnitedHealth Group
Allergan
Humana
Aetna
Becton, Dickinson & Company
4.4
4.3
4.3
4.2
3.6
T. Rowe Price Financial Services Fund
Citigroup
JPMorgan Chase
State Street
Morgan Stanley
Intercontinental Exchange
4.9
3.9
3.6
2.9
2.8
T. Rowe Price Science & Technology Fund
Amazon.com
Microsoft
LinkedIn
Red Hat
SK Hynix
7.4
6.3
4.9
4.1
4.1
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
2As of June 30, 2016, the weighted benchmark is composed of: Morningstar Technology Index—34.00%, Morningstar Financial Index—33.00%, and Morningstar Health Funds Index—33.00%.
15
EQUITY PORTFOLIO
The Equity Portfolio generated a negative return and underperformed its weighted benchmark for the 12-month period ended June 30, 2016.
The portfolio is focused on long-term capital appreciation. Its assets are held in a diversified selection of growth and value funds invested in the stocks of companies
based in the U.S. and international developed and emerging markets.
Overall, security selection in the underlying funds detracted from relative performance. The John Hancock II Capital Appreciation Fund and John Hancock Disciplined
Value Fund underperformed their style-specific benchmarks, as did the T. Rowe Price Blue Chip Growth Fund and T. Rowe Price Equity Income Fund. Conversely, the
John Hancock International Growth Fund and T. Rowe Price New Horizons Fund outperformed their respective benchmarks.
From an allocation perspective, an overweight to international equities relative to U.S. equities detracted from relative performance as U.S. equities outperformed
international equities in the 12-month period. The portfolio reduced its overweight to international stocks as the prospects for improved earnings growth
diminished with lowered global growth expectations. An underweight to U.S. small-cap equities benefited performance as small-cap stocks underperformed their
large-cap counterparts.
The portfolio’s inclusion of diversifying sectors—particularly through the T. Rowe Price Real Assets Fund—contributed to relative returns. The fund invests in securities
of companies that are engaged in activities related to real assets, such as commodities, real estate, energy, and natural resources. Exposure to real assets equities lifted
relative results as oil, metal, and agricultural commodity prices rallied and real estate investment trusts posted solid returns.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
(issues before June 3, 2002)
Class A, including sales charge
(issues on or after June 3, 2002)
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C
Class C2
Weighted Benchmark2
Asset class breakdown
6 months
-2.51
12 months
-6.32
-4.02
-7.78
1.03
-4.32
0.68
0.91
0.63
2.34
-2.93
-7.51
-3.66
-3.18
-3.66
-1.56
6/30/15
6/30/16
100%
100%
■ Equity
Portfolio composition (%)
As percent of net assets
T. Rowe Price Blue Chip Growth Fund
T. Rowe Price Equity Income Fund
John Hancock II Capital Appreciation Fund (subadvised by Jennison)
John Hancock Disciplined Value Fund (subadvised by Boston Partners)
T. Rowe Price New Horizons Fund
John Hancock II International Value Fund (subadvised by Templeton)
John Hancock Disciplined Value International Fund (subadvised by Boston Partners)
John Hancock International Growth Fund (subadvised by Wellington)
Oppenheimer International Growth Fund
John Hancock II Emerging Markets Fund (subadvised by Dimensional Fund Advisors)
T. Rowe Price Mid-Cap Value Fund
American Mutual Fund
T. Rowe Price Real Assets Fund
6/30/15
6/30/16
17.2
15.2
10.2
7.6
5.7
6.5
6.6
6.0
6.1
5.8
5.6
3.7
3.8
16.1
14.8
9.4
7.2
7.0
6.8
6.5
6.4
6.2
6.1
6.1
3.8
3.6
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
2As of June 30, 2016, the weighted benchmark is composed of: Russell 3000 Index—70.00% and MSCI AC World Index ex USA—30.00%.
16
FIXED INCOME PORTFOLIO
The Fixed Income Portfolio generated a positive return for the 12-month period ended June 30, 2016, but underperformed its benchmark, the Barclays U.S. Aggregate
Bond Index.
This portfolio utilizes a broadly diversified approach to income investing. Roughly half of its assets are invested in the T. Rowe Price Spectrum Income Fund, a multi-sector
income fund that includes investments in investment-grade, high yield, nondollar, and emerging markets bonds, and dividend-paying stocks. The portfolio also invests in
the John Hancock II Core Bond Fund (subadvised by Wells Capital Management) and John Hancock II Strategic Income Opportunities Fund (subadvised by JHAM).
The Spectrum Income Fund underperformed its style-specific benchmark, the Barclays U.S. Aggregate Bond Index, due to security selection in some of the underlying
portfolios. The John Hancock II Strategic Income Opportunities Fund trailed its respective benchmark due to unfavorable security selection and relatively short duration
positioning, which hurt returns as yields fell globally over the past year. The John Hancock II Core Bond Fund also trailed its style-specific benchmark.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
(issues before June 3, 2002)
Class A, including sales charge
(issues on or after June 3, 2002)
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C
Class C2
Barclays U.S. Aggregate Bond Index
Asset class breakdown
6 months
1.95
12 months
0.75
1.43
0.22
5.65
0.27
5.27
5.52
5.25
5.31
4.40
-0.38
3.62
4.13
3.62
6.00
6/30/15
6/30/16
100%
100%
■ Fixed Income
Portfolio composition (%)
As percent of net assets
T. Rowe Price Spectrum Income Fund
John Hancock II Core Bond Fund (subadvised by Wells Capital Management)
John Hancock II Strategic Income Opportunities Fund (subadvised by JHAM)
6/30/15
6/30/16
50.1
37.3
12.6
50.2
37.5
12.3
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
17
SHORT-TERM BOND PORTFOLIO
The Short-Term Bond Portfolio posted a positive return but underperformed its benchmark, the Barclays 1–3 Year U.S. Government/Credit Bond Index, for the 12-month
period ended June 30, 2016. The portfolio is entirely invested in the T. Rowe Price Short-Term Bond Fund, which invests in short- and intermediate-term investment-grade
corporate, government, and mortgage-backed securities.
Security selection was the biggest detractor from relative returns. The portfolio held select energy issuers that performed poorly as oil prices plunged over the past year,
causing credit ratings agencies to downgrade a large number of energy companies. In response, management reduced the fund’s exposure to higher-risk energy and
commodity-related bonds.
On the other hand, sector allocation contributed to relative performance. An overweight to investment-grade corporate bonds and underweight to Treasuries helped
results, especially after oil bottomed out in February and investors’ risk appetite improved. Out-of-benchmark positions in securitized debt including asset- and
mortgage-backed bonds helped performance as these securities did well in periods of high demand for safe-haven assets.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
(issues before June 3, 2002)
Class A, including sales charge
(issues on or after June 3, 2002)
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C
Class C2
Barclays 1–3 Year U.S. Government/Credit
Bond Index
Asset class breakdown
6 months
-2.13
12 months
-2.46
-2.63
-2.97
1.42
-3.96
1.04
1.30
1.01
1.65
1.08
-3.65
0.35
0.82
0.34
1.59
6/30/15
6/30/16
100%
100%
■ Fixed Income
Portfolio composition (%)
As percent of net assets
T. Rowe Price Short-Term Bond Fund
6/30/15
6/30/16
100.0
100.0
Top five holdings as of 6/30/16 (%)
T. Rowe Price Short-Term Bond Fund
FNMA - Mortgages
U.S. Treasuries
Commercial Mortgage PTCs
Bank of America
FHLMC - Mortgages
9.3
5.6
1.7
1.6
1.6
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
18
MONEY MARKET PORTFOLIO
The Money Market Portfolio posted a flat return and underperformed its benchmark, the Citigroup 3-Month Treasury Bill Index, for the 12-month period ended
June 30, 2016. Since June 1, 2016, the portfolio is entirely invested in the T. Rowe Price U.S. Treasury Money Fund.
Money market rates remained very low over the past year. In December 2015, the Federal Reserve (Fed) raised its target for short-term interest rates to a 0.25% to
0.50% range from a previous 0.00% to 0.25% range—the first change in U.S. monetary policy in seven years. Since that time, the Fed has refrained from additional
rate hikes due to uneven U.S. growth early this year and overseas developments whose consequences could impact the U.S. economy. Most market participants expect
the Fed will move cautiously until the global economy is on firmer footing given low inflation and widespread uncertainty after Brexit.
Overwhelming demand for, and a smaller supply of, short-term, high-quality investments kept yields very low over the year. Three-month Treasury bill yields rose from 0.16%
to 0.26% in the first six months of 2016, while one-year Treasury bill yields declined from 0.64% to 0.46%. Although the Fed has kept rates unchanged thus far in 2016,
most market participants believe that another rate hike is possible this year if the labor market continues to improve and other gauges of domestic demand strengthen.
Performance comparison as of 6/30/161 (%)
Class
Original Money Market Portfolio
Class A
Class C2
Citigroup 3-Month Treasury Bill Index
Asset class breakdown
6 months
0.00
0.00
0.00
0.12
12 months
0.00
0.00
0.00
0.14
6/30/15
6/30/16
100%
100%
■ Fixed Income
Portfolio composition (%)
As percent of net assets
T. Rowe Price U.S. Treasury Money Fund
T. Rowe Price Summit Cash Reserves Fund
6/30/15
6/30/16
—
100.0
100.0
—
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class. An investment in the Money Market Portfolio is not insured
or guaranteed by the FDIC or any other government agency. Although the portfolio seeks to preserve the value of your investment at $1.00 per unit, it is possible to lose money by investing in
the portfolio.
19
Portfolio highlights—Lifestyle portfolios
LIFESTYLE GROWTH 529 PORTFOLIO
Over the 12-month period ended June 30, 2016, the Lifestyle Growth 529 Portfolio, which is entirely invested in the John Hancock Funds II Lifestyle Growth
Portfolio, posted negative returns and underperformed its custom blended benchmark (56% Russell 3000 Index, 24% MSCI All Country World ex-USA Index, 16%
Barclays U.S. Aggregate Bond Index, and 4% Bank of America Merrill Lynch U.S. High Yield Master II Index).
In terms of asset allocation, an overweight in defensive equity strategies lifted relative performance, as did an underweight in international developed markets
large-cap stocks. An allocation dedicated to equity assets that benefit from rising global commodity prices was also helpful. Meanwhile, the portfolio’s underweight in
U.S. mid-cap equities detracted from relative returns as U.S. mid-cap stocks outpaced the larger-cap segment. An underweight allocation to fixed income assets also
weighed on relative results.
On balance, manager selection weighed on relative results for the period. The most significant detractors from performance included the Technical Opportunities Fund
(Wellington), Fundamental Large Cap Value Fund (JHAM), and Capital Appreciation Fund (Jennison). Conversely, the most significant contributors to performance
included the International Value Fund (Templeton), Emerging Markets Fund (Dimensional), and Absolute Return Currency Fund (First Quadrant).
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
6 months
-4.20
0.84
-4.51
12 months
-8.53
-3.72
-8.26
Class
Class B, excluding sales charge
Class C2
Weighted benchmark2
6 months
0.49
0.49
3.16
12 months
-4.44
-4.45
-0.10
Portfolio composition (%)
As percent of net assets
Absolute Return Currency Fund (First Quadrant)
Active Bond Fund (Declaration/JHAM)
All Cap Core Fund (QS Investors)
Alpha Opportunities Fund (Wellington)
Asia Pacific Total Return Bond Fund (JHAM)
Blue Chip Growth Fund (T. Rowe Price)
Capital Appreciation Fund (Jennison)
Capital Appreciation Fund (T. Rowe Price)
Core Bond Fund (Wells Capital)
Disciplined Value Fund (Boston Partners)
Emerging Markets Debt Fund (JHAM)
Emerging Markets Equity Fund (JHAM)
Emerging Markets Fund (DFA)
Equity Income Fund (T. Rowe Price)
Financial Industries Fund (JHAM)
Floating Rate Income Fund (WAMCO)
Focused High Yield Fund (JHAM)
Fundamental Global Franchise Fund (JHAM)
Fundamental Large Cap Value Fund (JHAM)
Global Absolute Return Strategies Fund (Standard Life)
Global Bond Fund (PIMCO)
Global Equity Fund (JHAM)
Global Income Fund (Stone Harbor)
Global Real Estate Fund (DeAWM)
Global Shareholder Yield Fund (Epoch)
Global Short Duration Credit Fund (JHAM)
Health Sciences Fund (T. Rowe Price)
High Yield Fund (WAMCO)
International Core Fund (GMO)
International Growth Opportunities Fund (Baillie Gifford)
6/30/15
6/30/16
1.67
1.04
2.63
4.45
0.60
4.28
3.90
4.64
0.27
1.89
0.98
0.49
4.71
4.32
2.04
2.90
0.59
1.01
3.31
1.91
0.28
1.02
0.67
0.47
1.41
0.48
1.10
0.32
2.60
1.94
1.48
1.98
2.33
4.09
0.62
3.85
3.50
5.15
0.64
1.89
1.02
2.42
2.65
4.19
1.43
2.34
0.56
1.05
3.23
2.21
0.27
1.08
0.60
0.50
1.40
0.44
0.65
0.27
3.23
1.66
As percent of net assets
International Growth Stock Fund (Invesco)
International Small Cap Fund (Franklin Templeton)
International Small Company Fund (DFA)
International Value Equity Fund (JHAM)
International Value Fund (Franklin Templeton)
Mid Cap Stock Fund (Wellington)
Mid-Cap Value Fund (T. Rowe Price)
Natural Resources Fund (Jennison)
New Opportunities Fund (DFA/Invesco/Brandywine/GW&K)
Real Estate Fund (T. Rowe Price)
Real Return Bond Fund (PIMCO)
Redwood Fund (Boston Partners)
Science & Technology Fund (Allianz/T. Rowe Price)
Seaport Fund (Wellington)
Short Duration Credit Opportunities Fund (Stone Harbor)
Small Cap Core Fund (JHAM)
Small Cap Growth Fund (Wellington)
Small Cap Opportunities Fund (DFA/Invesco)
Small Cap Value Fund (Wellington)
Small Company Growth Fund (Invesco)
Small-Cap Value Fund (T. Rowe Price)
Spectrum Income Fund (T. Rowe Price)
Strategic Growth Fund (JHAM)
Strategic Income Opportunities Fund (JHAM)
Technical Opportunities Fund (Wellington)
Total Return Fund (PIMCO)
U.S. Equity Fund (GMO)
U.S. High Yield Bond Fund (Wells Capital)
Value Equity Fund (Barrow Hanley)
Value Fund (Invesco)
6/30/15
6/30/16
2.09
1.67
1.66
1.42
4.00
3.32
2.56
1.21
0.50
0.47
0.67
0.82
2.43
0.34
1.58
0.50
0.52
0.00
0.69
0.47
0.47
1.04
3.88
1.65
2.36
0.77
2.16
0.38
1.32
1.13
2.26
1.82
1.84
3.49
1.60
3.25
2.59
1.43
0.48
0.50
1.12
0.80
2.05
0.31
1.67
0.12
0.49
0.50
0.68
0.46
0.46
1.14
3.56
2.30
2.08
1.46
2.03
0.40
1.32
1.06
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
2The weighted benchmark reflects the performance of the Russell 3000 Index—56.00%, MSCI All Country World Index ex USA—24.00%, Barclays U.S. Aggregate Bond Index—16.00%, and
Bank of America Merrill Lynch U.S. High Yield Master II Index—4.00%.
20
LIFESTYLE BALANCED 529 PORTFOLIO
Over the 12-month period ended June 30, 2016, the Lifestyle Balanced 529 Portfolio, which is entirely invested in the John Hancock Funds II Lifestyle Balanced
Portfolio, posted negative returns and underperformed its custom blended benchmark (42% Russell 3000 Index, 18% MSCI All Country World ex-USA Index, 32%
Barclays U.S. Aggregate Bond Index, and 8% Bank of America Merrill Lynch U.S. High Yield Master II Index).
In terms of asset allocation, an overweight in defensive equity strategies lifted relative performance, as did an underweight in international developed markets
large-cap stocks. An allocation dedicated to equity assets that benefit from rising global commodity prices was also helpful. Meanwhile, the portfolio’s underweight in
U.S. mid-cap equities detracted from relative returns as U.S. mid-cap stocks outpaced the larger-cap segment. An underweight allocation to fixed income assets also
weighed on relative results.
On balance, manager selection modestly detracted from relative results. The most significant detractors from performance included the Technical Opportunities Fund
(Wellington), Fundamental Large Cap Value Fund (JHAM), and Blue Chip Growth Fund (T. Rowe Price). Conversely, the most significant contributors to performance
included the Absolute Return Currency Fund (First Quadrant), International Value Fund (Templeton), and Spectrum Income Fund (T. Rowe Price).
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
6 months
-3.02
2.09
-3.32
12 months
-6.79
-1.88
-6.51
Class
Class B, excluding sales charge
Class C2
Weighted benchmark2
6 months
1.68
1.75
3.95
12 months
-2.62
-2.62
1.31
Portfolio composition (%)
As percent of net assets
Absolute Return Currency Fund (First Quadrant)
Active Bond Fund (Declaration/JHAM)
All Cap Core Fund (QS Investors)
Alpha Opportunities Fund (Wellington)
Asia Pacific Total Return Bond Fund (JHAM)
Blue Chip Growth Fund (T. Rowe Price)
Capital Appreciation Fund (Jennison)
Capital Appreciation Fund (T. Rowe Price)
Core Bond Fund (Wells Capital)
Disciplined Value Fund (Boston Partners)
Emerging Markets Debt Fund (JHAM)
Emerging Markets Equity Fund (JHAM)
Emerging Markets Fund (DFA)
Equity Income Fund (T. Rowe Price)
Financial Industries Fund (JHAM)
Floating Rate Income Fund (WAMCO)
Focused High Yield Fund (JHAM)
Fundamental Global Franchise Fund (JHAM)
Fundamental Large Cap Value Fund (JHAM)
Global Absolute Return Strategies Fund (Standard Life)
Global Bond Fund (PIMCO)
Global Equity Fund (JHAM)
Global Income Fund (Stone Harbor)
Global Real Estate Fund (DeAWM)
Global Shareholder Yield Fund (Epoch)
Global Short Duration Credit Fund (JHAM)
Health Sciences Fund (T. Rowe Price)
High Yield Fund (WAMCO)
International Core Fund (GMO)
International Growth Opportunities Fund (Baillie Gifford)
6/30/15
6/30/16
1.83
3.59
1.59
3.02
1.03
3.09
2.61
4.41
1.34
1.40
1.32
0.33
3.06
3.08
1.72
5.84
1.04
0.91
2.29
2.05
1.18
0.96
1.13
0.69
1.33
1.09
0.95
0.58
2.08
1.53
1.59
4.55
1.37
2.86
1.04
2.84
2.41
4.81
1.89
1.49
1.35
1.48
1.55
3.05
1.19
4.65
1.05
0.99
2.33
2.37
1.16
1.05
0.98
0.74
1.27
1.01
0.50
0.53
2.02
1.23
As percent of net assets
International Growth Stock Fund (Invesco)
International Small Cap Fund (Franklin Templeton)
International Small Company Fund (DFA)
International Value Equity Fund (JHAM)
International Value Fund (Franklin Templeton)
Investment Quality Bond Fund (Wellington)
Mid Cap Stock Fund (Wellington)
Mid-Cap Value Fund (T. Rowe Price)
Natural Resources Fund (Jennison)
New Opportunities Fund (DFA/Invesco/Brandywine/GW&K)
Real Estate Fund (T. Rowe Price)
Real Return Bond Fund (PIMCO)
Redwood Fund (Boston Partners)
Science & Technology Fund (Allianz/T. Rowe Price)
Seaport Fund (Wellington)
Short Duration Credit Opportunities Fund (Stone Harbor)
Short Term Government Income Fund (JHAM)
Small Cap Core Fund (JHAM)
Small Cap Growth Fund (Wellington)
Small Cap Value Fund (Wellington)
Small Company Growth Fund (Invesco)
Small-Cap Value Fund (T. Rowe Price)
Spectrum Income Fund (T. Rowe Price)
Strategic Growth Fund (JHAM)
Strategic Income Opportunities Fund (JHAM)
Technical Opportunities Fund (Wellington)
Total Return Fund (PIMCO)
U.S. Equity Fund (GMO)
U.S. High Yield Bond Fund (Wells Capital)
Value Equity Fund (Barrow Hanley)
Value Fund (Invesco)
6/30/15
6/30/16
1.65
1.22
1.21
1.11
3.13
1.34
2.31
1.82
1.15
0.37
0.45
0.98
0.79
1.95
0.32
3.61
0.00
0.37
0.39
0.53
0.35
0.37
2.58
2.61
4.09
1.39
2.47
1.96
0.73
0.86
0.82
1.61
1.19
1.20
1.11
2.61
1.61
2.22
1.84
1.06
0.35
0.50
2.12
0.78
1.75
0.29
3.70
0.24
0.36
0.37
0.50
0.33
0.35
2.71
2.44
4.65
1.24
3.18
1.90
0.77
0.91
0.76
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
2The weighted benchmark reflects the performance of the Russell 3000 Index—42.00%, MSCI All Country World Index ex USA—18.00%, Barclays U.S. Aggregate Bond Index—32.00%, and
Bank of America Merrill Lynch U.S. High Yield Master II Index—8.00%.
21
LIFESTYLE MODERATE 529 PORTFOLIO
Over the 12-month period ended June 30, 2016, the Lifestyle Moderate 529 Portfolio, which is entirely invested in the John Hancock Funds II Lifestyle Moderate
Portfolio, posted a positive return but underperformed its custom blended benchmark (28% Russell 3000 Index, 12% MSCI All Country World ex-USA Index, 48%
Barclays U.S. Aggregate Bond Index, and 12% Bank of America Merrill Lynch U.S. High Yield Master II Index).
In terms of asset allocation, an overweight in defensive equity strategies lifted relative performance, as did an underweight in international developed markets largecap stocks. An allocation dedicated to equity assets that benefit from rising global commodity prices was also helpful. Meanwhile, the portfolio’s underweight in U.S.
mid-cap equities detracted from relative returns U.S. mid-cap stocks outpaced the larger-cap segment. An underweight allocation to fixed income assets also weighed
on relative results.
On balance, manager selection modestly detracted from relative results. The most significant detractors from performance included the Fundamental Large Cap Value
Fund (JHAM), Blue Chip Growth Fund (T. Rowe Price), and Capital Appreciation Fund (Jennison). Conversely, the most significant contributors to performance included
the Absolute Return Currency Fund (First Quadrant), Spectrum Income Fund (T. Rowe Price), and International Value Fund (Templeton).
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
6 months
-1.66
3.52
-1.84
12 months
-4.70
0.32
-4.39
Class
Class B, excluding sales charge
Class C2
Weighted benchmark2
6 months
3.16
3.15
4.70
12 months
-0.41
-0.41
2.66
Portfolio composition (%)
As percent of net assets
Absolute Return Currency Fund (First Quadrant)
Active Bond Fund (Declaration/JHAM)
Alpha Opportunities Fund (Wellington)
Asia Pacific Total Return Bond Fund (JHAM)
Blue Chip Growth Fund (T. Rowe Price)
Capital Appreciation Fund (Jennison)
Capital Appreciation Fund (T. Rowe Price)
Core Bond Fund (Wells Capital)
Emerging Markets Debt Fund (JHAM)
Emerging Markets Equity Fund (JHAM)
Emerging Markets Fund (DFA)
Enduring Equity Fund (Wellington)
Equity Income Fund (T. Rowe Price)
Floating Rate Income Fund (WAMCO)
Focused High Yield Fund (JHAM)
Fundamental Global Franchise Fund (JHAM)
Fundamental Large Cap Value Fund (JHAM)
Global Absolute Return Strategies Fund (Standard Life)
Global Bond Fund (PIMCO)
Global Equity Fund (JHAM)
Global Income Fund (Stone Harbor)
Global Real Estate Fund (DeAWM)
Global Shareholder Yield Fund (Epoch)
Global Short Duration Credit Fund (JHAM)
High Yield Fund (WAMCO)
International Core Fund (GMO)
6/30/15
6/30/16
2.04
8.00
2.03
1.70
2.54
2.04
4.14
3.21
1.87
0.21
1.84
0.48
3.12
8.54
1.43
0.88
3.06
2.31
2.29
0.89
1.47
0.47
1.23
1.05
0.93
1.15
1.79
8.69
1.62
1.80
2.24
1.82
4.44
3.76
1.87
0.79
0.86
0.50
3.04
6.53
1.43
0.95
2.95
2.64
2.25
1.02
1.27
0.50
1.15
0.96
0.85
1.35
As percent of net assets
International Growth Opportunities Fund (Baillie Gifford)
International Growth Stock Fund (Invesco)
International Small Cap Fund (Franklin Templeton)
International Small Company Fund (DFA)
International Value Equity Fund (JHAM)
International Value Fund (Franklin Templeton)
Investment Quality Bond Fund (Wellington)
Mid Cap Stock Fund (Wellington)
Mid-Cap Value Fund (T. Rowe Price)
Natural Resources Fund (Jennison)
Real Estate Fund (T. Rowe Price)
Real Return Bond Fund (PIMCO)
Redwood Fund (Boston Partners)
Seaport Fund (Wellington)
Short Duration Credit Opportunities Fund (Stone Harbor)
Short Term Government Income Fund (JHAM)
Small Cap Growth Fund (Wellington)
Small Cap Value Fund (Wellington)
Small Company Growth Fund (Invesco)
Small-Cap Value Fund (T. Rowe Price)
Spectrum Income Fund (T. Rowe Price)
Strategic Growth Fund (JHAM)
Strategic Income Opportunities Fund (JHAM)
Total Return Fund (PIMCO)
U.S. Equity Fund (GMO)
U.S. High Yield Bond Fund (Wells Capital)
6/30/15
6/30/16
0.95
1.03
0.85
0.85
0.66
2.00
3.20
1.52
1.65
0.82
0.46
1.48
0.76
0.31
4.24
0.00
0.33
0.46
0.29
0.32
3.26
2.04
5.15
5.50
1.89
1.06
0.87
0.94
0.75
0.75
0.62
1.53
3.44
1.41
1.61
0.75
0.50
3.26
0.75
0.27
4.33
0.29
0.30
0.41
0.27
0.29
3.41
1.85
5.32
6.05
1.83
1.13
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
2The weighted benchmark reflects the performance of the Russell 3000 Index—28.00%, MSCI All Country World Index ex USA—12.00%, Barclays U.S. Aggregate Bond Index—48.00%, and
Bank of America Merrill Lynch U.S. High Yield Master II Index—12.00%.
22
Portfolio highlights—Individual portfolios
NEW HORIZONS PORTFOLIO
The New Horizons Portfolio posted a negative return but outperformed its benchmark, the Russell 2000 Growth Index, for the 12-month period ended June 30, 2016.
The portfolio is entirely invested in the T. Rowe Price New Horizons Fund, which invests in small-cap growth stocks.
Stock selection contributed to the fund’s outperformance, particularly in the health care, industrials and business services, consumer discretionary, and energy sectors.
On the other hand, the financials sector detracted from relative returns. Concerns about banks’ loan exposure to the troubled energy sector, adverse trading conditions,
and low interest rates globally weighed on many financial companies over the past year.
Consumer discretionary, health care, and industrials and business services—the top contributors to outperformance over the period—rank among the fund’s largest
sector allocations on an absolute basis. Information technology remains a major area of investment. The fund seeks to invest in companies that are increasing market
share and have strong management teams that can exploit opportunities regardless of the economic and technology spending environment.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C2
Russell 2000 Growth Index
Asset class breakdown
6 months
-4.45
0.58
-4.80
0.20
0.20
-1.59
12 months
-7.62
-2.76
-7.34
-3.48
-3.47
-10.75
Portfolio composition (%)
As percent of net assets
T. Rowe Price New Horizons Fund
6/30/15
6/30/16
100%
100%
■ Equity
Top five holdings as of 6/30/16 (%)
6/30/15
6/30/16
100.0
100.0
New Horizons Fund
O'Reilly Automotive
Vail Resorts
SS&C Technologies Holdings
Liberty Ventures
Zillow
2.4
2.1
1.9
1.9
1.9
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
23
CAPITAL APPRECIATION PORTFOLIO
The Capital Appreciation Portfolio posted a negative return and underperformed its benchmark, the Russell 1000 Growth Index, for the 12-month period ended
June 30, 2016.
Individual stock selection based on business fundamentals drives the portfolio’s construction. Heightened risk aversion in a volatile market environment largely
deflected focus from company fundamentals over the period as investors sought more conservative assets. As a result, defensive, high-dividend-paying stocks drove the
market’s returns, while stocks of faster-growth companies lagged.
Health care holdings, which contributed significantly to returns in the previous reporting period, detracted from absolute and relative performance in the fiscal year.
Concerns about drug pricing practices and scrutiny relating to corporate tax inversions used in several drug industry mergers were among the headwinds facing health
care stocks. Weakness in information technology also weighed on returns as some large-cap companies experienced slowing sales growth.
The portfolio’s positioning in consumer discretionary, consumer staples, and industrials and business services detracted from relative performance. On the other hand,
positions in the energy and materials sectors benefited relative returns.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C2
Russell 1000 Growth Index
Asset class breakdown
6 months
-11.65
-7.00
-12.00
-7.37
-7.36
1.36
12 months
-9.67
-4.92
-9.39
-5.61
-5.67
3.02
6/30/15
6/30/16
100%
100%
■ Equity
Portfolio composition (%)
As percent of net assets
John Hancock II Capital Appreciation Fund (subadvised by Jennison)
6/30/15
6/30/16
100.0
100.0
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
24
SMALL-CAP STOCK PORTFOLIO
The Small-Cap Stock Portfolio posted a negative return but outperformed its benchmark, the Russell 2000 Index, for the 12-month period ended June 30, 2016.
The portfolio is entirely invested in the T. Rowe Price Small-Cap Stock Fund, which invests in a blend of small-cap growth and value stocks.
Stock selection contributed to the fund’s outperformance, particularly in the industrials and business services, health care, energy, and information technology sectors.
On the other hand, the financials sector detracted from relative returns. Concerns about banks’ loan exposure to the troubled energy sector, adverse trading conditions,
and low interest rates globally weighed on many financial companies over the past year.
Financials represented the largest sector on an absolute basis at period-end. The fund has a large position in regional banks, primarily those with moderate
valuations, reasonably strong balance sheets, and improving credit quality. Industrials and business services followed by information technology were the next-largest
sector allocations.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C2
Russell 2000 Index
Asset class breakdown
6 months
-1.44
3.74
-1.63
3.37
3.36
2.22
12 months
-7.67
-2.81
-7.37
-3.51
-3.55
-6.73
Portfolio composition (%)
As percent of net assets
T. Rowe Price Small-Cap Stock Fund
6/30/15
6/30/16
100%
100%
■ Equity
Top five holdings as of 6/30/16 (%)
6/30/15
6/30/16
100.0
100.0
Small-Cap Stock Fund
TreeHouse Foods
ONE Gas
SS&C Technologies Holdings
Pinnacle Foods
John Bean Technologies
1.3
1.1
1.1
1.0
1.0
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
25
BLUE CHIP GROWTH PORTFOLIO
The Blue Chip Growth Portfolio posted a negative return and underperformed its benchmark, the Russell 1000 Growth Index, for the 12-month period ended June 30, 2016.
The portfolio is entirely invested in the T. Rowe Price Blue Chip Growth Fund, which invests in large-cap growth companies.
The health care sector detracted significantly from relative performance. Health care stocks have faced challenges since the third quarter of 2015, when concerns about
potential drug pricing regulation came to the fore. A slowdown in merger and acquisition activity and several clinical and commercial setbacks also contributed to the
sector’s underperformance. The consumer staples sector also detracted from relative returns. The fund had a sizable underweight to consumer staples, one of the year’s
best-performing sectors as investors sought defensive, dividend-paying stocks when market volatility picked up starting in late 2015.
On the other hand, the consumer discretionary sector contributed the most to relative performance, followed by information technology, the fund’s largest sector at
period-end. Roughly half of the fund’s technology holdings are Internet software and services companies.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C2
Russell 1000 Growth Index
Asset class breakdown
6 months
-10.73
-6.03
-11.05
-6.37
-6.37
1.36
12 months
-7.05
-2.16
-6.79
-2.91
-2.90
3.02
Portfolio composition (%)
As percent of net assets
T. Rowe Price Blue Chip Growth Fund
6/30/15
6/30/16
100%
100%
■ Equity
Top five holdings as of 6/30/16 (%)
6/30/15
6/30/16
100.0
100.0
Blue Chip Growth Fund
Amazon.com
Alphabet
Facebook
Priceline
Danaher
8.4
6.5
4.6
3.6
3.4
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
26
INTERNATIONAL VALUE PORTFOLIO
International equities declined during the 12-month period ended June 30, 2016, against a backdrop of global deflationary pressures, volatility in Chinese markets,
a slower pace of U.S. interest rate increases, and widespread uncertainty after the UK voted to leave the European Union. The International Value Portfolio posted a
negative return in this environment. Emerging markets stocks declined more than international developed markets equities, although the asset class regained some
positive momentum toward period-end.
The U.S. dollar appreciated against most global currencies, which hurt the portfolio’s non-U.S. holdings because local currency-denominated investments lost value
as the dollar rose. The portfolio’s consumer staples holdings detracted the most from relative performance, pressured by stock selection and an underweight in this
traditionally defensive sector during a period of rising risk aversion. Investors seeking safety and quality in an uncertain environment crowded into consumer staples,
bidding up valuations to near-record levels relative to more cyclical parts of the market. We believed there was scarce long-term value in consumer staples given the
historically high valuations of many companies in the sector.
A modest overweight in financials holdings also detracted from relative returns, pressured by European banks that declined immediately after Brexit. We maintained
exposure to select European banks based on our view that their valuations were historically cheap and that they have demonstrated solid restructuring and
recapitalization progress in a stabilizing regulatory environment. We were also encouraged by their ability to adjust business models to increase fee-based income
and to manage the margin challenges posed by low to negative interest rates globally. We believe that European banks are far better capitalized and supported by
policymakers than they were in the crises of 2008 and 2011. Moreover, they have passed stress tests subjecting their balance sheets to extremely adverse conditions.
Holdings in traditionally cyclical sectors, such as materials, energy, consumer discretionary, and industrials and business services, all outperformed. Materials, led by
mining companies, contributed the most to relative performance. After a sustained underweight in the mining industry, we have begun to find value in select companies
following the end of the China-driven commodities “supercycle,” particularly among precious metals producers trading at what we consider favorable valuations.
From a regional standpoint, our out-of-benchmark exposure to Canada contributed to relative returns, supported primarily by the aforementioned mining investments.
An overweight allocation in Asia and an underweight in Europe detracted.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C2
MSCI EAFE Index
Asset class breakdown
6 months
-4.11
0.94
-4.50
0.50
0.50
-4.04
12 months
-16.03
-11.61
-15.78
-12.27
-12.28
-9.72
6/30/15
6/30/16
100%
100%
■ Equity
Portfolio composition (%)
As percent of net assets
John Hancock II International Value Fund (subadvised by Templeton)
6/30/15
6/30/16
100.0
100.0
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
27
MID-CAP VALUE PORTFOLIO
The Mid-Cap Value Portfolio posted a positive return and outperformed its benchmark, the Russell Midcap Value Index, for the 12-month period ended June 30, 2016.
The portfolio is entirely invested in the T. Rowe Price Mid-Cap Value Fund, which invests in undervalued mid-cap companies.
The energy sector contributed significantly to relative returns. The fund accumulated positions in select oil and gas companies whose shares fell in the energy sector
downturn starting in late 2015. These positions lifted performance for the year as oil prices rebounded from 13-year lows in February. Holdings in several materials
stocks also benefited performance as commodity prices rallied and the U.S. housing market continued to recover.
Consumer staples was the fund’s largest overweight allocation at period-end. The fund’s holdings in this sector are mostly in the food products and food and staples
retailing industries. Unfavorable stock selection in consumer staples weighed on relative returns, though an overweight to this strongly performing sector mitigated the
negative impact. The utilities sector also detracted from relative returns due to an underweight in the sector, the benchmark’s best performer for the year.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C2
Russell Midcap Value Index
Asset class breakdown
6 months
5.19
10.73
5.31
10.31
10.32
8.87
12 months
-1.71
3.46
-1.32
2.68
2.69
3.25
Portfolio composition (%)
As percent of net assets
T. Rowe Price Mid-Cap Value Fund
6/30/15
6/30/16
100%
100%
■ Equity
Top five holdings as of 6/30/16 (%)
6/30/15
6/30/16
100.0
100.0
Mid-Cap Value Fund
FirstEnergy
Vulcan Materials
Bunge Limited
Hologic
Franco-Nevada
2.8
2.6
2.2
2.2
2.1
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
28
EQUITY INCOME PORTFOLIO
The Equity Income Portfolio posted a positive return but underperformed its benchmark, the Russell 1000 Value Index, for the 12-month period ended June 30, 2016. The
portfolio is entirely invested in the T. Rowe Price Equity Income Fund, which invests in undervalued large-cap companies that have a strong track record of paying aboveaverage dividends.
The financials sector detracted significantly from relative performance. Shares of many banks and insurance companies fell amid various concerns including
nonperforming loans to energy companies, difficult trading conditions in early 2016, and low interest rates globally. Investors also worried that the Brexit vote would
hurt economic growth in the UK and Europe and spur global central banks to further ease monetary policy, which would push interest rates even lower worldwide.
The fund’s energy holdings contributed to relative performance. The fund held positions in several global oil companies, whose shares rallied as oil prices surged from
13-year lows hit in February and crossed the $50 per barrel threshold in June for the first time in nearly a year.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C2
Russell 1000 Value Index
Asset class breakdown
6 months
1.18
6.51
1.08
6.08
6.08
6.30
12 months
-4.27
0.76
-4.05
-0.05
-0.04
2.86
Portfolio composition (%)
As percent of net assets
T. Rowe Price Equity Income Fund
6/30/15
6/30/16
100%
100%
■ Equity
Top five holdings as of 6/30/16 (%)
6/30/15
6/30/16
100.0
100.0
Equity Income Fund
GE
JPMorgan Chase
ExxonMobil
Pfizer
Johnson & Johnson
3.0
3.0
2.8
2.3
1.9
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
29
AMERICAN MUTUAL PORTFOLIO
The American Mutual Portfolio posted positive absolute results and outperformed its benchmark, the Russell 1000 Value Index, for the 12-month period ended
June 30, 2016.
The portfolio employs a relatively conservative investment approach and tends to favor high-quality, dividend-paying companies. Historically, the significant investment
in equities has helped the portfolio’s performance in market rallies. In addition, it has tended to outperform the broader stock market during declines because of its
focus on dividend-paying companies, which are typically less volatile than the overall market.
Over the past year, the portfolio’s holdings in the high-yielding telecommunication services and utilities sectors contributed the most to absolute returns. Investments
in consumer staples and information technology companies also lifted returns. However, returns in the health care sector were weighed by concerns about
controversial drug pricing practices at a few companies. Energy sector returns reflected the challenging environment for energy companies as oil prices hit a 13-year
low in February. Financials sector stocks were weak due to difficult trading positions in early 2016, low interest rates globally, and worries about loan exposure to the
troubled energy sector.
The portfolio strives to generate consistent, long-term gains by seeking to preserve capital in down markets and to keep pace in up markets. This approach can provide
a smoother, less volatile stream of returns for investors seeking growth and income over a full market cycle.
Performance comparison as of 6/30/161 (%)
Class
Class A, including sales charge
Class A, excluding sales charge
Class B, including sales charge
Class B, excluding sales charge
Class C2
Russell 1000 Value Index
Asset class breakdown
6 months
2.77
8.18
2.78
7.78
7.79
6.30
12 months
0.58
5.88
1.05
5.05
5.08
2.86
6/30/15
6/30/16
100%
100%
■ Equity
Portfolio composition (%)
As percent of net assets
American Mutual Fund
6/30/15
6/30/16
100.0
100.0
The performance data presented represent past performance. Past performance is not a guarantee of future results, and current performance may be higher or lower than the performance quoted.
Investment returns in John Hancock Freedom 529’s portfolios and the value of an investor’s units will fluctuate and may be worth more or less than the original cost when redeemed. Performance
current to the most recent month-end is available at johnhancockfreedom529.com or by calling 1-866-222-7498. Average annual total returns may be found on pages 6–7.
1Performance for “Class A, including sales charge” reflects a 5.25% maximum sales charge for units purchased on or after June 3, 2002, until September 2, 2014, unless grandfather rules apply.
Performance with a sales charge reflects a 5.00% (4.00% for the Short-Term Bond and Fixed Income Portfolios) maximum sales charge for units purchased on or after September 2, 2014.
The application of breakpoint pricing or rights of accumulation to a Class A Account could result in a lesser sales charge. Class B units carry a 6-year contingent deferred sales charge (maximum
of 5.00%, declining over 6 years). Performance for “Class B, including sales charge” reflects the applicable sales charge for the periods shown. Class C2 units are not assessed a sales charge.
Performance figures reflect the deduction of program fees, underlying investment management fees, and other expenses of the underlying mutual funds in which the portfolio invests. Performance
does not reflect the annual account maintenance fee of $25. If it did, performance would be lower. Please refer to the Plan Disclosure Document for more detailed information on the fees and
expenses, including the applicable program management fee, trust fee, and distribution and service fee, associated with each class.
30
31
Selected financial data
As of the fiscal year ended 6/30/16 (in thousands, except per-unit values)
INVESTMENTS
American Mutual Fund
John Hancock Disciplined Value Fund (Boston Partners)
John Hancock Disciplined Value International Fund (Boston Partners)
John Hancock Funds II Capital Appreciation Fund (Jennison)
John Hancock Funds II Core Bond Fund (Wells)
John Hancock Funds II Emerging Markets Value Fund
(Dimensional Fund Advisors)
John Hancock Funds II Fundamental Value Fund (Davis)
John Hancock Funds II International Value Fund (Templeton)
John Hancock Funds II Lifestyle Balanced Portfolio
John Hancock Funds II Lifestyle Growth Portfolio
John Hancock Funds II Lifestyle Moderate Portfolio
John Hancock Funds II Strategic Income Opportunities Fund (JHAM)
John Hancock Funds III International Growth Fund (Wellington)
Oppenheimer International Growth Fund
T. Rowe Price Blue Chip Growth Fund
T. Rowe Price Equity Income Fund
T. Rowe Price Financial Services Fund
T. Rowe Price Health Sciences Fund
T. Rowe Price Limited Duration Inflation Focused Bond Fund
(formerly the Inflation Focused Bond Fund)1
T. Rowe Price Mid-Cap Value Fund
T. Rowe Price New Horizons Fund
T. Rowe Price Real Assets Fund
T. Rowe Price Science & Technology Fund
T. Rowe Price Short-Term Bond Fund
T. Rowe Price Small-Cap Stock Fund
T. Rowe Price Spectrum Income Fund
T. Rowe Price Summit Cash Reserves Fund
T. Rowe Price U.S. Treasury Money Fund
Investments, at value
Portfolio
2033–2036
Portfolio
2029–2032
Portfolio
2025–2028
Portfolio
2021–2024
Portfolio
2017–2020
College
Portfolio
Short-Term Fixed Income
Bond Portfolio
Portfolio
$473
915
721
1,241
–
$6,867
13,347
10,487
18,041
–
$12,884
24,698
19,369
33,480
31,702
$18,264
34,280
27,329
45,866
122,451
$19,791
37,069
14,515
50,030
185,344
$9,544
17,763
3,021
24,062
108,463
–
–
–
–
–
–
–
–
–
$23,262
539
7,855
14,647
20,113
4,231
–
–
–
–
730
–
–
–
–
753
711
1,855
1,790
–
–
–
10,681
–
–
–
–
10,950
10,356
27,018
26,082
–
–
–
19,556
–
–
–
10,352
20,236
19,412
50,177
48,413
–
–
–
27,101
–
–
–
40,056
28,660
27,077
69,424
67,071
–
–
–
14,392
–
–
–
60,859
14,995
14,173
75,140
72,487
–
–
–
3,548
–
–
–
36,450
3,194
3,201
35,893
34,739
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
7,662
–
–
–
–
–
–
–
–
–
–
127,138
288,321
–
–
998
930
641
–
–
–
–
–
–
$12,297
14,534
13,615
9,398
–
–
–
–
–
–
$179,231
26,872
25,265
17,269
–
–
–
42,345
–
–
$416,677
37,292
35,180
23,566
–
–
–
163,783
–
–
$787,513
13,868
13,385
18,949
–
–
–
247,864
–
–
$984,230
–
–
7,518
–
–
–
145,439
–
–
$721,156
–
–
–
–
$31,404
–
–
–
–
$31,404
–
–
–
–
–
–
31,118
–
–
$62,042
$8,768
–
–
3,530
–
$122,246
2,601
–
54,292
–
$273,165
10,738
–
132,541
–
$495,311
13,495
–
278,325
–
$563,621
10,425
70,733
338,864
–
$381,688
5,683
73,723
259,718
–
$15,095
1,000
2,933
12,374
–
$31,272
759
4,221
25,754
–
9.55
–
–
9.47
–
14.08
13.53
–
13.55
–
15.02
14.04
–
14.03
–
26.10
20.92
–
23.53
–
24.70
20.67
23.77
25.23
–
22.06
15.16
21.20
16.25
–
17.83
11.61
17.16
11.96
–
27.29
16.59
26.20
18.05
–
10.05
–
–
9.47
–
14.82
13.53
–
13.55
–
15.81
14.04
–
14.03
–
27.47
20.92
–
23.53
–
26.00
20.67
23.77
25.23
–
23.22
15.16
21.20
16.25
–
18.57
11.61
17.16
11.96
–
28.43
16.59
26.20
18.05
–
$17
173
101
291
–
11,591
11,882
$451
5,212
(8,790)
(3,127)
–
40,700
37,573
$2,224
10,913
(18,534)
(5,397)
–
41,619
36,222
$6,777
19,182
(26,432)
(473)
–
47,805
47,332
$9,263
21,572
(21,065)
9,770
–
23,336
33,106
$3,551
15,586
(9,595)
9,542
–
(158,148)
(148,606)
$219
(103)
114
230
–
1,083
1,313
$1,190
163
975
2,328
–
(3,592)
(1,264)
TOTAL ASSETS
Net assets
Class A
Class B
Class C
Class C2
Original Class
Net assets value per unit
Class A
Class B
Class C
Class C2
Original Class
Maximum offering price per unit
Class A
Class B
Class C
Class C2
Original Class
CHANGES IN NET ASSETS (7/1/15—6/30/16)
Net investment income (loss)
Net realized gain (loss)
Change in net unrealized gain/loss
Increase (decrease) from operations
Decrease from distributions
Increase (decrease) from unit transactions
Increase (decrease) in net assets during the period
1The T. Rowe
32
Price Inflation Focused Bond Fund was renamed the T. Rowe Price Limited Duration Inflation Focused Bond Fund on September 29, 2015.
Equity
Portfolio
Future Trends
Portfolio
Money
Market
Portfolio
Lifestyle
Growth 529
Portfolio
Lifestyle
Lifestyle
Balanced 529 Moderate 529 New Horizons
Portfolio
Portfolio
Portfolio
Blue Chip
Growth
Portfolio
Capital
Mid-Cap Value International Equity Income Small-Cap
Appreciation
Portfolio
Value Portfolio
Portfolio Stock Portfolio Portfolio
American
Mutual
Portfolio
$9,015
17,106
15,553
22,345
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
$20,504
–
$34,937
–
–
–
–
14,552
–
–
–
–
–
–
–
–
–
–
–
–
–
–
16,138
–
–
–
–
15,314
14,814
38,369
35,236
–
–
–
–
–
–
–
–
–
–
–
–
$29,987
30,315
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
$248,763
–
–
–
–
–
–
–
–
–
–
$145,814
–
–
–
–
–
–
–
–
–
–
–
–
–
$55,980
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
$57,352
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
$27,135
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
$30,837
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
14,367
16,681
8,567
–
–
–
–
–
–
$238,057
–
–
–
32,308
–
–
–
–
–
$92,610
–
–
–
–
–
–
–
–
$74,905
$74,905
–
–
–
–
–
–
–
–
–
$248,763
–
–
–
–
–
–
–
–
–
$145,814
–
–
–
–
–
–
–
–
–
$55,980
–
$38,511
–
–
–
–
–
–
–
$38,511
–
–
–
–
–
–
–
–
–
$57,352
$39,957
–
–
–
–
–
–
–
–
$39,957
–
–
–
–
–
–
–
–
–
$27,135
–
–
–
–
–
–
–
–
–
$30,837
–
–
–
–
–
$23,193
–
–
–
$23,193
–
–
–
–
–
–
–
–
–
$20,504
–
–
–
–
–
–
–
–
–
$34,937
$132,105
1,294
28,171
76,330
–
$57,251
1,025
8,648
25,628
–
$20,215
–
–
14,988
39,705
$150,080
4,127
–
94,456
–
$81,661
2,214
–
61,871
–
$32,519
982
–
22,558
–
$26,289
597
–
11,601
–
$37,227
674
–
19,428
–
$27,686
557
–
11,693
–
$18,199
369
–
8,549
–
$19,990
356
–
10,479
–
$15,772
408
–
6,998
–
$14,224
351
–
5,916
–
$24,235
350
–
10,330
–
26.55
22.14
25.58
27.08
–
34.05
28.48
32.65
38.67
–
1.00
–
–
1.00
1.00
15.54
14.42
N/A
14.37
–
15.66
14.50
–
14.51
–
15.88
14.68
–
14.72
–
33.16
30.21
–
30.30
–
33.96
24.69
–
30.44
–
43.04
30.29
–
38.50
–
8.60
8.08
–
8.07
–
25.04
20.77
–
22.49
–
36.30
28.85
–
32.58
–
17.01
15.97
–
15.98
–
26.85
22.45
–
24.22
–
27.95
22.14
25.58
27.08
–
35.84
28.48
32.65
38.67
–
1.00
–
–
1.00
1.00
16.36
14.42
–
14.37
–
16.48
14.50
–
14.51
–
16.72
14.68
–
14.72
–
34.91
30.21
–
30.30
–
35.75
24.69
–
30.44
–
45.31
30.29
–
38.50
–
9.05
8.08
–
8.07
–
26.36
20.77
–
22.49
–
38.21
28.85
–
32.58
–
17.91
15.97
–
15.98
–
28.26
22.45
–
24.22
–
$669
10,192
(19,303)
(8,442)
–
(15,779)
(24,221)
$(389)
8,391
(15,304)
(7,302)
–
4,060
(3,242)
–
–
–
–
–
$9,801
9,801
$3,846
13,552
(27,089)
(9,691)
–
8,083
(1,608)
$2,728
9,106
(15,084)
(3,250)
–
1,652
(1,598)
$1,147
2,014
(3,110)
51
–
1,705
1,756
$(286)
3,168
(3,922)
(1,040)
–
2,848
1,808
$(442)
2,633
(3,494)
(1,303)
–
8,518
7,215
$145
3,238
(2,104)
1,279
–
367
1,646
$321
(760)
(3,118)
(3,557)
–
1,106
(2,451)
$380
1,450
(1,625)
205
–
772
977
$(150)
2,547
(3,109)
(712)
–
70
(642)
$(145)
2,966
(3,860)
(1,039)
–
2,068
1,029
$404
1,495
9
1,908
–
2,785
4,693
33
If your state or your designated Beneficiary’s state offers a 529 Plan, you may want to consider what, if any, potential state income
tax or other ­benefits it offers before i­nvesting. State tax or other benefits should be one of many factors to be considered prior to making
an investment decision. Please consult with your financial, tax, or other ­advisor about how these state benefits, if any, may apply to your
specific circumstances. You may also contact your state 529 Plan or any other 529 college savings plan to learn more about their features.
Please contact your financial consultant or call 866-222-7498 to obtain a Plan Disclosure Document or prospectus for any of the
underlying funds. The Plan Disclosure Document contains complete details on investment objectives, risks, fees, charges, and expenses,
as well as more information about municipal fund securities and the underlying investment companies that should be considered
before investing. Please read the Plan Disclosure Document carefully prior to investing.
John Hancock Freedom 529 is a college savings plan offered by the Education Trust of Alaska, managed by T. Rowe Price, and distributed
by John Hancock Distributors LLC through other broker-dealers that have a selling agreement with John Hancock Distributors LLC.
John Hancock Distributors LLC is a m
­ ember of FINRA and is listed with the ­Municipal Securities Rulemaking Board (MSRB). © 2016
John Hancock. All rights reserved. Information included in this material is believed to be accurate as of the September 2016 printing date.
John Hancock Freedom 529
P.O. Box 17603 Baltimore, MD 21297-1603 866-222-7498 johnhancockfreedom529.com
529 PLANS ARE NOT FDIC INSURED, MAY LOSE VALUE, AND ARE NOT BANK OR STATE GUARANTEED.
C3RRL3ULZ
9/16
2016-US-26598