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NEXT The Hunt for Uncommon Growth

The Search for Income

With interest rates at historic lows, fixed income is no longer providing the returns investors need.
Consider Widening Your Income Lens
Rates have been at historical lows,
reducing income.





Equities
Bonds
Traditional
60%/40% allocation
Equities
Enhanced Allocation

The above is for illustrative purposes only.

 
NEXT Risk Gets Relevant PREV The Search for Income

The Hunt for Uncommon Growth

Innovation, disruptive economic ideas and new trends are potentially powerful engines for growth suggesting it’s time to widen our lens.

Traditional investing often reveals a deep home bias staying with familiar industries, brands and products.

Widen your lens to discover potential growth opportunities — global infrastructure, transportation including maritime...

Diversify for Growth Potential

Today's global market is defined by a rich spectrum of innovative products and services built on both digital and traditional platforms — technologies, communications, real assets, infrastructure and value-add efficiencies.

NEXT Defying Value Erosion PREV The Hunt for Uncommon Growth

Risk Gets Relevant

Today, investors need to face up to risk – what’s on the horizon in both fixed income and equities and how could it impact a portfolio's value.
Owning highly correlated securities gets risky and costly.
Allocations to nontraditional strategies may help address fluctuating conditions in the markets.
3.0%
If interest rates rise,
fixed income values may fall
Traditional
Portfolio
2,058
If stock market values decline,
equity allocations could
be punished
Fixed Income
Alternatives
Equity

Source: FactSet and U.S Treasury. As of 12/31/2014. The above is for illustrative purposes only. Results shown are hypothetical and do not represent the returns of any particular investment.

PREV Risk Gets Relevant

Defying Value Erosion

In an inflationary environment, life becomes more expensive. Building an investment portfolio that stays ahead of inflation requires a broader tool set.
Dollar 3%
$1.00
$1.00
U.S. Dollar
Buying power of the dollar
Bread 2%
$0.77
$0.77
Bread
Per pound
Eggs 1%
$0.92
$0.92
Eggs
Per dozen (Large, grade A)
Gasoline 0%
$1.11
$1.11
Gasoline
Per gallon (3.875 liters)

Inflation may be just around the corner.

With rates hovering around historical lows, investors are likely facing a period of rising rates, when the cost of goods and services rise faster than wages.

Consider investment strategies that may outpace inflation and help investors stay ahead of rising rates.

  • 1994
  • 2014

Source: US Bureau of Labor Statistics. Cost of US dollar is calculated from the US government CPI data.

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Investment Ideas

  • The New Yield Order

    Income doesn’t always come from traditional asset classes.

    Download PDF The New Yield Order

    Sources: FactSet, PerTrack. As of 9/30/2015. Performance data quoted represent past performance, which is no guarantee of future results. High Yield is represented by the Barclays U.S. Corporate High Yield Index, Emerging Markets Debt by the Barclays EM USD Aggregate Index, U.S. REITs by the FTSE NAREIT All Equity REITs Index, Utilities by the Barclays Investment Grade Utility Index, U.S. IG Credit by the Barclays U.S. Corporate Investment Grade Index, U.S. Core Fixed Income by the Barclays U.S. Agg Index, Dividend Paying Stocks by the S&P 500 High Yield Dividend Aristocrats Index, U.S. Equities by the S&P 500 Index, Global Treasuries by the Barclays Global Treasury ex-U.S. (Hedged) Index, U.S. Treasuries by the Barclays U.S. Treasury Index, MLPs by the Alerian MLP Index and Floating Rate Loans by the S&P/LSTA U.S. Leveraged Loan Index.

  • Diversify Your Income Sources

    Sector return leaders rotate over time so it’s important to consider alternative income sources that may be more resilient to market changes, like sudden moves in interest rates.

    Download PDF Diversify Your Income Sources

    Source: Morningstar, U.S. Bureau of Labor Statistics. *Private Equity data as of 9/30/14. Performance data quoted represent past performance, which is no guarantee of future results. MLPs are represented by the Alerian MLP Index, Floating Rate Loans by the Credit Suisse Leveraged Loan Index, Investment Grade by the Barclays U.S. Aggregate Bond Index, Emerging Markets by the MSCI Emerging Markets Index, Private Equity by the Cambridge Associates Private Equity Index, High Yield Bonds by the Barclays U.S. High Yield 2% Issuer Cap Index, REITs by the FTSE NAREIT All Equity REIT Index, U.S. Equities by the S&P 500 Index. Investments in different types of strategies, securities and asset classes have different characteristics, including risks, returns and fees. Indexes are unmanaged and are not available for direct investment. Index returns do not reflect fees and expenses associated with actively managed portfolios.

  • Interest Rate Increases Hurt Most from Low Starting Point

    If interest rates rise 2–4%, the loss is 70% higher when starting at a lower interest rate.

    Download PDF Interest Rate Increases Hurt Most from Low Starting Point

    For illustrative purposes only. Results shown are hypothetical and do not represent the returns of any particular investment.

  • 2
    Investment Solutions
    For each Funds' relevant risk disclosures please scroll to the bottom of this page.

    You May Come Out Ahead Being in the Middle

    Small companies aren't the only ones with big growth potential. Consider this: over time, mid-cap companies have demonstrated more attractive growth than their small- and large-cap counterparts, proving worthy of a dedicated allocation in investors' portfolios.

    Download PDF You May Come Out Ahead Being in the Middle

    Source: FactSet. Data as of May 1995–September 2015. Performance data quoted represent past performance, which is no guarantee of future results. Small Cap Companies are represented by Russell 2000 Index, Mid-Cap Companies by the Russell Midcap Index and Large Cap Companies by the S&P 500 Index

  • Put Home Country Bias Aside

    Investors seeking growth opportunities should consider that international stocks currently have many tailwinds benefitting them: recovering domestic economies, the potential for currency-driven earnings growth, cost-driven margin expansion and acquisition activity. Despite strong year-to-date performance of international over U.S. equities, international equities are still trading at an attractive discount to U.S. equities.

    The "CAPE" Ratio has historically been considered by many to be a good indicator of whether markets are over- or undervalued.

    Download PDF Put Home Country Bias Aside

    Source: FactSet, Rimes. Performance data quoted represent past performance, which is no guarantee of future results. U.S. equities are represented by the S&P 500 Index and international equities by the MSCI EAFE Index.

  • 1
    Investment Solutions
    For each Funds' relevant risk disclosures please scroll to the bottom of this page.

    Not All Dividends Are Created Equal

    Dividend paying stocks have generated competitive returns with less volatility than non-dividend paying stocks.

    Download PDF Not All Dividends Are Created Equal

    Source: Data as of 9/30/1994 – 9/30/2014. Ned Davis Research. Performance data quoted represent past performance, which is no guarantee of future results. Performance measures of S&P 500 Index stocks by dividend policy. Dividends are not guaranteed, are up to the discretion of the companies and can stop at any time.

  • Finding Growth Away From Home

    The U.S. hasn’t always been the best-performing market annually.

    Download PDF Finding Growth Away From Home

    Source: Factset. Performance data quoted represent past performance, which is no guarantee of future results. Country returns are represented by the MSCI ACW Index.

  • Alternatives Have Historically Performed Well Across Market Cycles

    Hedge funds have outperformed stocks and traditional balanced portfolios since 2000 and with lower volatility.

    Download PDF Alternatives Have Historically Performed Well Across Market Cycles

    Source: PerTrac. As of 9/30/2015. Performance data quoted represent past performance, which is no guarantee of future results. Equities are represented by the S&P 500 Index, Fixed Income by the Barclays U.S. Aggregate Bond Index and Hedge Funds by the HFRI Fund Weighted Composite Index. Investments in hedge funds are speculative and may involve a higher degree of risk than investments in traditional asset classes, such as equities and fixed income. While hedge funds may offer the potential for attractive returns and improved diversification, they may also introduce risks that are different than those posed by traditional investments. Investments in different types of strategies, securities and asset classes have different characteristics, including risks, returns and fees. Indexes are unmanaged and are not available for direct investment. Index returns do not reflect fees and expenses associated with actively managed portfolios

  • Diversify the Hedge

    Traditional inflation hedging such as commodities, gold or global TIPS may not effectively manage inflation in today’s market environment.

    Download PDF Diversify the Hedge

    Source: Morningstar. As of 9/30/2015. Performance data quoted represent past performance, which is no guarantee of future results. Commodities are represented by Bloomberg Commodity Index, Global TIPS by the Barclays Global Inflation Linked Total Return Index, Gold by the S&P GSCI Gold Index. Investments in different types of strategies, securities and asset classes have different characteristics, including risks, returns and fees. Indexes are unmanaged and are not available for direct investment. Index returns do not reflect fees and expenses associated with actively managed portfolios.

  • Bumps Ahead for Equities?

    In recent years, volatility in the U.S. market has been well below historical norms. Given uncertainty with respect to the path of monetary policy and a potential rate hike on the horizon, many investors need to consider positioning themselves in strategies that may help manage volatility in anticipation of bumpy markets.

    Download PDF Bumps Ahead for Equities?

    Source: FactSet. Performance data quoted represent past performance, which is no guarantee of future results. Stock market returns are represented by the S&P 500 Index.

  • Seek to Limit Your Downside Exposure

    Over time, long-short hedge fund strategies have avoided drawdowns as steep as those experienced by the equity market, which is one of the keys to accumulating wealth in the long term.

    Download PDF Seek to Limit Your Downside Exposure

    Sources: PerTrac. As of 9/30/2015. Performance data quoted represent past performance, which is no guarantee of future results. Hedging seeks to reduce the effects of a negative market but may limit performance in an up market. Equities are represented by the S&P 500 Index and Hedge Funds by the HFRI Equity Hedge Index. Investments in hedge funds are speculative and may involve a higher degree of risk than investments in traditional asset classes, such as equities and fixed income. While hedge funds may offer the potential for attractive returns and improved diversification, they may also introduce risks that are different than those posed by traditional investments. Investments in different types of strategies, securities and asset classes have different characteristics, including risks, returns and fees. Indexes are unmanaged and are not available for direct investment. Index returns do not reflect fees and expenses associated with actively managed portfolios

  • Selection Matters More Among Hedge Funds

    Compared to long-only managers, the dispersion, or range of performance, among hedge fund managers is vast, highlighting the importance of manager selection.

    Download PDF Selection Matters More Among Hedge Funds

    Source: Neuberger Berman Alternatives Proprietary Peer Groups, Morningstar Direct. Performance data quoted represent past performance, which is no guarantee of future results. Includes all funds with an Institutional share class in the Morningstar Intermediate-Term Bond and Large-Cap Value categories. This information is a combination of the market views and empirical data collected by the NB Alternative Investment Management Team and analyzed from the team’s proprietary peer groups. The team has been tracking information for the past 10 years on 3,500 hedge funds across 80 distinct sub-strategies and geographies, although the number of underlying funds in each peer group will vary over time as new funds are launched and in turn, shut down. NB Alternative Investment Management Team members define the strategies of hedge funds to ensure the strategy definitions accurately reflect each hedge fund’s activities and, therefore, each peer group consists of comparable data.

  • Volatility Happens

    Despite sometimes steep annual drawdowns, U.S. equities have positive annual returns nearly 80% of the time.

    Download PDF Volatility Happens

    Source: FactSet. Performance data quoted represent past performance, which is no guarantee of future results. U.S. Equities are represented by the S&P 500 Index. Returns are based on price index only and do not include dividends. Maximum annual drawdown refers to the largest market drops from a peak to trough during the year.

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Explore More Practical Alternatives

This material is provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. Any views or opinions expressed may not reflect those of the firm as a whole. This material may include estimates, outlooks, projections and other “forward-looking statements.” Due to a variety of factors, actual events may differ significantly from those presented. Investing entails risks, including possible loss of principal. Past performance is no guarantee of future results.

This material is being issued on a limited basis through various global subsidiaries and affiliates of Neuberger Berman Group LLC. Please visit www.nb.com/disclosure-global-communications for the specific entities and jurisdictional limitations and restrictions.

Definitions:

The Alerian MLP Index is a gauge of large- and mid-cap energy Master Limited Partnerships (MLPs). The float-adjusted, capitalization-weighted index, which includes 50 prominent companies and captures approximately 75% of available market capitalization, is disseminated real-time on a price-return basis and on a total-return basis.

Annualized Volatility is a statistical measure of the historical volatility of a mutual fund or portfolio.

The Barclays Capital Universal Government Inflation-Linked Bond Index (Barclays Global Inflation Linked Total Return Index), combines the World, Euro and EM government indices to measure the performance of the major developed and emerging government inflation-linked bond markets. The index includes inflation-linked government bonds from 19 countries; in order of size, the US, UK, France, Brazil, Italy, Japan, Canada, Sweden, Germany, Argentina, Mexico, Greece, South Africa, Australia, Turkey, Colombia, Chile, Poland and South Korea.

The Barclays EM USD Aggregate Index includes USD-denominated debt from emerging markets around the world.

The Barclays Global Treasury Ex-U.S. Index includes government bonds issued by investment-grade countries outside the United States, in local currencies, that have a remaining maturity of one year or more and are rated investment grade.

The Barclays Investment Grade Utility Index measures the performance of U.S. dollar-denominated publicly-issued investment grade “corporate bonds in the utility sector.

The Barclays U.S. Aggregate Bond Index represents securities that are U.S. domestic, taxable and dollar-denominated. The Index covers the U.S. investment-grade, fixed-rate bond market, with index components for government and corporate securities, mortgage pass-through securities and asset-backed securities.

The Barclays U.S. Corporate High Yield Index is an unmanaged index of the universe of fixed rate, non-investment grade debt. Pay-in-kind (PIK) bonds, Eurobonds, and debt issues from emerging market countries are excluded, but Canadian and global bonds (SEC registered) of issuers in non-EMG countries are included.

The Barclays U.S. Corporate Investment Grade Index includes U.S. dollar-denominated, investment-grade, fixed-rate, taxable securities issued by industrial, utility and financial companies, with maturities greater than 10 years.

The Barclays U.S. High Yield 2% Issuer Cap Index measures the performance of high yield corporate bonds, with a maximum allocation of 2% to any one issuer.

The Barclays U.S. Treasury Index is an unmanaged index of prices of U.S. Treasury bonds with maturities of one to 30 years.

The Cambridge Associates Private Equity Index is an end-to-end calculation based on data compiled from 1,052 U.S. private equity funds (buyout, growth equity, private equity energy and mezzanine funds), including fully liquidated partnerships, formed between 1986 and 2014. Performance results are generally gross of investment manager fees.

The Credit Suisse Leveraged Loan Index is designed to mirror the investable universe of the U.S. dollar denominated leveraged loan market. Only funded term loans are included. The tenor must be at least one year. Issuers must be domiciled in developed countries.

The FTSE NAREIT All Equity REITs Index is an unmanaged free float adjusted market capitalization weighted index that tracks the performance of all Equity REITs currently listed on the New York Stock Exchange, the NASDAQ National Market System and the NYSE Amex. REITs are classified as Equity REITs if 75% or more of their gross invested book assets are invested directly or indirectly in real property.

The HFRI Equity Hedge Index is a fund-weighted index of select hedge funds focusing on Equity Hedge strategies. Equity Hedge investing consists of a core holding of long equities hedged at all times with short sales of stocks and/or stock index options.

The HFRI Fund Weighted Composite represents the performance of the entire hedge fund manager universe. The Index includes more than 2,000 domestic and offshore funds that are equally weighted. All funds report assets in USD, and report net of all fee returns on a monthly basis. There are no funds of funds included in the Index, and the fund must have at least $50 million under management or have been actively trading for at least 12 months.

The MSCI EAFE Index (Europe, Australia, Far East) Index is a free float-adjusted market capitalization weighted index designed to measure developed market equity performance.

The MSCI Emerging Markets Index is a free float-adjusted market capitalization index that is designed to measure equity market performance of emerging markets. As of May 30, 2014, the MSCI Emerging Markets Index consists of the following 23 emerging market country indices: Brazil, Chile, China, Colombia, Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Korea, Malaysia, Mexico, Peru, Philippines, Poland, Qatar, Russia, South Africa, Taiwan, Thailand, Turkey and the UAE.

The MSCI All Country World Index covers over 9,000 securities across large, mid and small cap size segments and across style and sector segments in 45 Developed and Emerging Markets.

The Russell 2000 Index is an index that measures the performance of the 2,000 smallest companies in the Russell 3000 Index.

The Russell Midcap Index measures the performance of the 800 smallest companies in the Russell 1000 Index, which represents approximately 25% of the total market capitalization of the Russell 1000 Index (which, in turn, consists of the 1,000 largest U.S. companies, based on market capitalization).

The S&P 500 High Yield Dividend Aristocrats Index measures the performance of companies within the S&P Composite 1500® that have followed a managed-dividends policy of consistently increasing dividends every year for at least 20 years.

The S&P 500 Index consists of 500 stocks chosen for market size, liquidity and industry group representation. It is a market value-weighted index (stock price times number of shares outstanding), with each stock’s weight in the Index proportionate to its market value. The “500” is one of the most widely used benchmarks of U.S. equity performance.

The S&P GSCI Enhanced Commodity Index is a composite index of commodity sector returns representing an unleveraged, long-only investment in commodity futures that is broadly diversified across the spectrum of commodities.

The S&P/LSTA U.S. Leveraged Loan Index is a daily total return index that uses LSTA/LPC Mark-to-Market Pricing to calculate market value change. On a real-time basis, the S&P/LSTA Leveraged Loan index tracks the current outstanding balance and spread over LIBOR for fully funded term loans. The facilities included in the index represent a broad cross section of leveraged loans syndicated in the United States, including dollar-denominated loans to overseas issuers.

 

A Word About Risk:

An investor should consider a fund’s investment objectives, risks and fees and expenses carefully before investing. This and other important information can be found in each fund’s prospectus and summary prospectus, which you can obtain by calling 877.628.2583. Please read the prospectus and summary prospectus carefully before making an investment. Investments could result in loss of principal.

Small- and mid-capitalization stocks trade less frequently and in lower volume than larger company stocks and thus may be more volatile and more vulnerable to financial and other risks. Large capitalization stocks may be less responsive to changes in the market place and may lag in performance.

Foreign securities involve risks in addition to those associated with comparable U.S. securities, including exposure to less developed or less efficient trading markets; social, political or economic instability; fluctuations in foreign currencies; nationalization or expropriation of assets; settlement, custodial or other operational risks; and less stringent auditing and legal standards. Exchange rate exposure and currency fluctuations could erase or augment investment results. These risks are magnified in emerging or developing markets

Funds that invest in fixed income securities are subject to the associated risks including the risk that a bond’s value may fluctuate based on interest rates, market conditions, credit quality and other factors. You may have a gain or a loss if you sell your bonds prior to maturity. Bonds are subject to the credit risk of the issuer. High-yield bonds, also known as “junk bonds,” are considered speculative and carry a greater risk of default than investment-grade bonds. Their market value tends to be more volatile than investment-grade bonds. Sovereign debt securities are subject to the risk that a governmental entity may delay or refuse to pay interest or repay principal on its sovereign debt.

Additional Risks for the Neuberger Berman Absolute Return Multi-Manager Fund, Neuberger Berman Global Allocation Fund, Neuberger Berman Global Long Short Fund, Neuberger Berman Inflation Navigator Fund, Neuberger Berman Long Short Fund, Neuberger Berman Long Short Multi-Manager Fund, Neuberger Berman Emerging Markets Debt Fund, Neuberger Berman Risk Balanced Commodity Fund and Neuberger Berman Unconstrained Bond Fund

Derivatives involve risks different from, or greater than, the risks associated with investing in more traditional investments, as derivatives can be highly complex and volatile, difficult to value, highly illiquid, and a Fund may not be able to close out or sell a derivative position at a particular time or at an anticipated price. Non-U.S. currency forward contracts, options, swaps, or other derivatives contracts on non-U.S. currencies or securities involve a risk of loss, even if used for hedging purposes, if currency exchange rates move against the Fund.

Investments in the over-the-counter market introduce counterparty risk due to the possibility that the dealer providing the derivative may fail to timely satisfy its obligations. Investments in the futures markets also introduce the risk that its futures commission merchant (FCM) may default on its obligations, which include returning margin posted to a Fund. Derivative instruments can create leverage, which can amplify changes in the Fund’s net asset value and can result in losses that exceed the amount originally invested.

Additional Risks for the Neuberger Berman Inflation Navigator Fund

Most of the Fund’s performance depends on the Portfolio Managers’ success in evaluating the factors that determine the rates and sources of inflation as well as what happen in the equity, fixed income, real estate and commodities markets. Although the Fund is intended to provide a measure of protection against inflation, it is possible that it will not do so to the extent intended. The Fund’s investments may be adversely affected to a greater extent than other investments during deflationary periods.

The Fund may invest in Underlying Funds, including funds in the Neuberger Berman fund family. The investment performance of the Fund is directly related to the investment performance of the Underlying Funds in which it invests and the allocations among those Underlying Funds. The Fund is exposed to the same principal risks as the Underlying Funds as well as to the Underlying Funds’ expenses in direct proportion to the allocation of its assets to the Underlying Funds, which could result in the duplication of certain fees, including the management and administration fees.

REIT and other real estate company securities are subject to risks. Investing in MLPs involves certain risks related to investing in the underlying assets of the MLPs and risks associated with pooled investment vehicles.

Inflation-indexed debt securities are debt securities that are structured to provide protection against inflation. The value of the debt securities’ principal or the interest income paid on the security is adjusted to track changes in an official inflation measure. Repayment of the original principal upon maturity (as adjusted for inflation) is guaranteed in the case of U.S. Treasury inflation-indexed debt securities. For securities that do not provide a similar guarantee, the adjusted principal value of the securities repaid at maturity may be less than the original principal value.

ETFs are subject to tracking error and may be unable to sell poorly performing stocks that are included in their index. ETFs may trade in the secondary market at prices below the value of their underlying portfolios and may not be liquid.

The Fund may engage in active and frequent trading and may have a high portfolio turnover rate, which may increase the Fund’s transaction costs and may adversely affect the Fund’s performance.

Additional Risks for the Neuberger Berman Real Estate Fund

The Portfolio's concentration in real estate investments makes it subject to greater potential risks and volatility than a more diversified portfolio, and the value of its shares may decline due to events affecting the real estate industry.

In addition, the Fund is considered non-diversified. As such, the percentage of the Fund's assets invested in any single issuer is not limited by the Investment Company Act of 1940. Investing a higher percentage of its assets in any one issuer could increase the Fund's risk of loss and its share price volatility, because the value of its shares would be more susceptible to adverse events affecting that issuer.

The Fund may at times be more concentrated in particular subsectors of the real estate business—apartments, retail, hotels, offices, industrial, health care, etc. As such, its performance would be especially sensitive to developments that significantly affect those businesses.

Additional Risks for the Neuberger Berman Absolute Return Multi-Manager Fund and Neuberger Berman Long Short Multi-Manager Fund

Each Fund’s performance will largely depend on what happens in the equity and fixed income markets. The actual risk exposure taken by each Fund will vary over time, depending on various factors, including, Neuberger Berman’s methodology and decisions in allocating the Fund’s assets to subadvisers, and its selection and oversight of subadvisers.

The subadvisors’ investment styles may not always be complementary, which could adversely affect the performance of the Funds. Some subadvisors have little experience managing registered investment companies which, unlike the hedge funds these managers have been managing, are subject to daily inflows and outflows of investor cash and are subject to certain legal and tax-related restrictions on their investments and operations.

Each Fund’s returns may deviate from overall market returns to a greater degree than other mutual funds that do not employ an absolute return focus. Thus, the Fund might not benefit as much as funds following other strategies during periods of strong market performance. A subadviser may use strategies intended to protect against losses (i.e., hedged strategies), but there is no guarantee that such hedged strategies will be used or, if used, that they will protect against losses, perform better than non-hedged strategies or provide consistent returns.

Event Driven Strategies that invest in companies in anticipation of an event carry the risk that the event may not happen or may take considerable time to unfold, it may happen in modified or conditional form, or the market may react differently than expected to the event, in which case the Fund may experience losses. Additionally, event-driven strategies may fail if adequate information about the event is not obtained or such information is not properly analyzed. The actions of other market participants may also disrupt the events on which event driven strategies depend. Arbitrage Strategies involve the risk that underlying relationships between securities in which investment positions are taken may change in an adverse manner or in a manner not anticipated, in which case the Fund may realize losses. The Fund’s use of event-driven and arbitrage strategies will cause it to invest in actual or anticipated special situations—i.e., acquisitions, spin-offs, reorganizations and liquidations, tender offers and bankruptcies. These transactions may not be completed as anticipated or may take an excessive amount of time to be completed. They may also be completed on different terms than the subadvisor anticipates, resulting in a loss to the Fund. Some special situations are sufficiently uncertain that the Fund may lose its entire investment in the situation.

Short sales, selling a security a fund does not own in anticipation that the security’s price will decline, theoretically presents unlimited risk on an individual stock basis, since a fund may be required to buy the security sold short at a time when the security has appreciated in value. Leverage may amplify changes in a fund’s net asset value.

ETFs are subject to tracking error and may be unable to sell poorly performing stocks that are included in their index. ETFs may trade in the secondary market at prices below the value of their underlying portfolios and may not be liquid.

The Fund may engage in active and frequent trading and may have a high portfolio turnover rate, which may increase the Fund’s transaction costs and may adversely affect the Fund’s performance.

Additional Risks for the Neuberger Berman Risk Balanced Commodity Fund, Neuberger Berman Global Allocation Fund and Neuberger Berman Inflation Navigator Fund

Each Fund has significant investment exposure to the commodities markets and/or a particular sector of the commodities markets, may subject the Fund to greater volatility than investments in traditional securities. To the extent the Fund focuses its investments in a particular commodity in the commodities market, the Fund will be more susceptible to risks associated with the particular commodity. No active trading market may exist for certain commodities investments.

To qualify as a regulated investment company (“RIC”), the Fund must derive at least 90% of its gross income for each taxable year from sources treated as “qualifying income” under the Internal Revenue Code of 1986, as amended. Although qualifying income does not include income derived directly from commodities, including certain commodity-linked derivative instruments, the Fund nevertheless has received an opinion of counsel, which is not binding on the Internal Revenue Service (the “Service”) or the courts, that income the Fund derives from their investments in a subsidiary should constitute qualifying income. The tax treatment of income from commodity-related investments and the Fund’s income it earns through investment in a wholly-owned subsidiary may be adversely affected by future legislation, Treasury Regulations, and/or guidance issued by the Service that could affect the character, timing, and/or amount of the Fund’s taxable income or capital gains and distributions it makes. If the Service were to change its ruling position, such that the Fund’s income from the subsidiary was not qualifying income, the Fund could be unable to qualify as a RIC for one or more years. If the Fund failed to so qualify for any taxable year but was eligible to and did cure the failure, it would incur potentially significant additional federal income tax expense.

Leverage amplifies changes in the Fund’s net asset value (“NAV”). Derivative instruments that the Fund may use create leverage and can result in losses to the Fund that exceed the amount originally invested. There can be no assurance that the Fund’s use of any leverage will be successful.

The value of an individual security or particular type of security can be more volatile than the market as a whole and can perform differently from the value of the market as a whole. The Fund is considered non-diversified. As such, the percentage of the Fund’s assets invested in any single issuer is not limited by the Investment Company Act of 1940. Investing a higher percentage of its assets in any one issuer could increase the Fund’s risk of loss and its share price volatility.

Additional Risks for the Neuberger Berman Emerging Markets Debt Fund

The value of an individual security or particular type of security can be more volatile than the market as a whole and can perform differently from the value of the market as a whole. In addition, the Fund is classified as non-diversified. As such, the percentage of the Fund’s assets invested in any single issuer or a few issuers is not limited by the Investment Company Act of 1940. Investing a higher percentage of its assets in any one or a few issuers could increase the Fund’s risk of loss and its share price volatility, because the value of its shares would be more susceptible to adverse events affecting those issuers.

The Fund’s yield and share price will fluctuate in response to changes in interest rates. In general, the value of investments with interest rate risk, such as fixed income securities, will move in the direction opposite to movements in interest rates.

The Fund’s performance could be affected if borrowers pay back principal on debt securities before or after the market anticipates such payments, shortening or lengthening their duration. Floating rate securities can be less sensitive to prepayment risk.

Lower-rated debt securities (commonly known as “junk bonds”) involve greater risks than investment grade debt securities. Lower-rated debt securities may fluctuate more widely in price and yield than investment grade debt securities and may fall in price during times when the economy is weak or is expected to become weak.

Loans generally are subject to restrictions on transfer, and the Fund may be unable to sell loans at a time when it may otherwise be desirable to do so or may be able to sell them only at prices that are less than what the Fund regards as their fair market value. Loans may be difficult to value. Therefore, there is a risk that the value of the collateral securing a loan may decline after the Fund invests and that the collateral may not be sufficient to cover the amount owed to the Fund. In the event the borrower defaults, the Fund’s access to the collateral may be limited or delayed by bankruptcy or other insolvency laws.

Foreign securities, including those issued by foreign governments, involve risks in addition to those associated with comparable U.S. securities. Additional risks include exposure to less developed or less efficient trading markets; social, political or economic instability; fluctuations in foreign currencies or currency redenomination; potential for default on sovereign debt; nationalization or expropriation of assets; settlement, custodial or other operational risks; and less stringent auditing and legal standards. Investing in emerging market countries involves risks in addition to and greater than those generally associated with investing in more developed foreign countries. The governments of emerging market countries may be more unstable and more likely to impose capital controls, nationalize a company or industry, place restrictions on foreign ownership and on withdrawing sale proceeds of securities from the country, and/or impose burdensome taxes that could adversely affect security prices.

Sovereign debt securities are subject to the risk that a governmental entity may delay or refuse to pay interest or repay principal on its sovereign debt, due, for example, to cash flow problems, insufficient foreign currency reserves, political considerations, the relative size of the governmental entity’s debt position in relation to the economy, its policy toward international lenders or the failure to put in place economic reforms required by multilateral agencies. If a governmental entity defaults, it may ask for more time in which to pay or for further loans.

Non-U.S. currency forward contracts, options, swaps, or other derivatives contracts on non-U.S. currencies involve a risk of loss if currency exchange rates move against the Fund. Forward contracts are not guaranteed by an exchange or clearinghouse and a default by the counterparty may result in a loss to the Fund.

The value of a convertible security typically increases or decreases with the price of the underlying common stock. In general, a convertible security is subject to the risks of stocks (and its price may be as volatile as that of the underlying stock) when the underlying stock’s price is high relative to the conversion price and is subject to the risks of debt securities (and is particularly sensitive to changes in interest rates) when the underlying stock’s price is low relative to the conversion price.

Leverage amplifies changes in the Fund’s net asset value (“NAV”). Derivative instruments that the Fund uses create leverage and can result in losses to the Fund that exceed the amount originally invested.

The use of options involves investment strategies and risks different from those associated with ordinary portfolio securities transactions. If the Fund’s Portfolio Managers apply a strategy at an inappropriate time or judge market conditions or trends incorrectly, options may lower the Fund’s return.

The Fund may engage in active and frequent trading and may have a high portfolio turnover rate, which may increase the Fund’s transaction costs and may adversely affect the Fund’s performance.

Additional Risks for the Neuberger Berman Floating Rate Income Fund

The Fund may invest in senior loans and other debt securities which may be rated below investment grade. The risks of investing in such securities, such as risk of default, could result in loss of principal. Economic and other market events may reduce demand for certain senior loans held by the Fund, which may impact net asset value. Loans and other debt securities are also subject to the risk of increases in prevailing interest rates, although floating-rate securities are less susceptible to this risk than other fixed-rate obligations. Generally, bond values will decline as interest rates rise. However, because floating rates on senior loans only reset periodically, changes in prevailing interest rates can be expected to cause some fluctuation in the Fund’s net asset value. Similarly, a sudden and significant increase in market interest rates, a default in a loan in which the Fund owns an interest, or a material deterioration of a borrower’s creditworthiness may cause a decline in the Fund’s net asset value. Floating-rate loans may be more susceptible to adverse economic and business conditions and other developments affecting the issuers of such loans. Although senior floating-rate loans are generally collateralized, there is no guarantee that the value of collateral will not decline, causing a loan to be substantially unsecured. No active trading market may exist for many loans, and some loans may be subject to restrictions on resale, which may also prevent the Fund from obtaining the full value of a loan when sold.

Additional Risks for the Neuberger Berman Long Short Fund and Neuberger Berman Global Long Short Fund

Short selling is borrowing a security and then selling it in anticipation that the price will decline, so it can be bought back at a lower price, thus generating a profit. Short selling involves the risk that the value of the security sold short will rise, in which case losses may exceed that of the original amount invested and are theoretically unlimited.

Additional Risks for the Neuberger Berman Unconstrained Bond Fund

The Fund’s performance could be affected if borrowers pay back principal on debt securities before or after the market anticipates such payments, shortening or lengthening their duration. An increase in market interest rates would likely extend the effective duration of mortgage-backed securities, thereby magnifying the effect of the rate increase on the securities’ price. When interest rates are low, issuers will often repay the obligation underlying a “callable security” early, in which case the Fund may have to reinvest the proceeds in an investment offering a lower yield and may not benefit from any increase in value that might otherwise result from declining interest rates.

Loans generally are subject to restrictions on transfer, and the Fund may be unable to sell loans at a time when it may otherwise be desirable to do so or may be able to sell them only at prices that are less than what the Fund regards as their fair market value.

Inflation-indexed debt securities are debt securities that are structured to provide protection against inflation. The value of the debt securities’ principal or the interest income paid on the security is adjusted to track changes in an official inflation measure. Repayment of the original principal upon maturity (as adjusted for inflation) is guaranteed in the case of U.S. Treasury inflation-indexed debt securities. Sovereign debt securities are subject to the risk that a governmental entity may delay or refuse to pay interest or repay principal on its sovereign debt, due, for example, to cash flow problems, insufficient foreign currency reserves, political considerations, the relative size of the governmental entity’s debt position in relation to the economy, its policy toward international lenders or the failure to put in place economic reforms required by multilateral agencies. Currency fluctuations could negatively impact investment gains or add to investment losses.

Non-U.S. currency forward contracts, options, swaps, or other derivatives contracts on non-U.S. currencies involve a risk of loss if currency exchange rates move against the Fund. Forward contracts are not guaranteed by an exchange or clearinghouse and a default by the counterparty may result in a loss to the Fund. Governmental authorities may impose credit controls to limit the level of forward trading to the detriment of the Fund.

The Fund may engage in active and frequent trading and may have a high portfolio turnover rate, which may increase the Fund’s transaction costs and may adversely affect the Fund’s performance.

Short selling is borrowing a security and then selling it in anticipation that the price will decline, so it can be bought back at a lower price, thus generating a profit. Short selling involves the risk that the value of the security sold short will rise, in which case losses may exceed that of the original amount invested and are theoretically unlimited.

Preferred securities may pay fixed or adjustable rates of return. Preferred securities are subject to issuer-specific and market risks applicable generally to equity securities, however, unlike common stocks, participation in the growth of an issuer may be limited.

Additional Risks for the Neuberger Berman Mid Cap Growth Fund

Recent events in the U.S. and global economies have resulted, and may continue to result, in an unusually high degree of volatility in the financial markets, both domestic and foreign, and in the net asset values of many mutual funds, including, to some extent, the Fund. Stock markets are volatile and can decline significantly in response to adverse issuer, political, regulatory, market or economic developments. To the extent that the Fund sells stocks before they reach their market peak, it may miss out on opportunities for higher performance.

The value of an individual security or particular type of security can be more volatile than the market as a whole and can perform differently from the value of the market as a whole.

The stocks of mid-cap companies are often more volatile and less liquid than the stocks of larger companies and may be more affected than other types of stocks by the underperformance of a sector or during market downturns. Compared to larger companies, mid-cap companies may have a shorter history of operations, and may have limited product lines, markets or financial resources. Because the prices of most growth stocks are based on future expectations, these stocks tend to be more sensitive than value stocks to bad economic news and negative earnings surprises. Bad economic news or changing investor perceptions can negatively affect growth stocks across several industries and sectors simultaneously.

To the extent the Fund invests more heavily in particular sectors, its performance will be especially sensitive to developments that significantly affect those sectors. Individual sectors may move up and down more than the broader market. The several industries that constitute a sector may all react in the same way to economic, political or regulatory events.

Additional Risks for Neuberger Berman Socially Responsive Fund

The Fund’s social policy could cause it to underperform similar funds that do not have a social policy. Among the reasons for this are: undervalued stocks that do not meet the social criteria could outperform those that do, economic or political changes could make certain companies less attractive for investment, and the social policy could cause the Fund to sell or avoid stocks that subsequently perform well.

Additional Risks for Neuberger Berman Intrinsic Value Fund

Because the prices of most growth stocks are based on future expectations, these stocks tend to be more sensitive than value stocks to bad economic news and negative earnings surprises. Value stocks may remain undervalued during a given period or may not ever realize their full value. This may happen, among other reasons, because of a failure to anticipate which stocks or industries will benefit in various market conditions.

The principal risk associated with investing in anticipation of a catalyst is that certain catalysts may not happen or the market may react differently than expected, in which case the Fund may experience losses. Certain catalysts, such as companies emerging from, or restructuring as a result of, bankruptcy carry additional risks.

The “Neuberger Berman” name and logo are registered service marks of Neuberger Berman Group LLC. The individual fund names in this piece are either service marks or registered service marks of Neuberger Berman Investment Advisers LLC, an affiliate of Neuberger Berman LLC, member FINRA. 

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