Firsthand Technology Opportunities Fund

Firsthand Technology Opportunities Fund

Average Annual Total Returns vs. Indices
As of September 30, 2018
Period Firsthand Technology
Opportunities Fund
NASDAQ Composite Index S&P 500 Index
Since inception (9/30/99) 3.66% 6.85% 6.43%
10-Year 19.22% 15.82% 11.96%
5-Year 21.17% 17.83% 13.95%
3-Year 30.22% 21.81% 17.32%
1-Year 38.66% 25.21% 17.90%
Q3 '18 (not annualized) 6.07% 7.42% 7.71%
Monthly Performance Update
As of October 31, 2018
Period Firsthand Technology
Opportunities Fund
Since inception (9/30/99) 2.91%
10-Year 19.76%
5-Year 17.40%
3-Year 22.49%
1-Year 13.77%
1-Month -12.71%

Datasheet

The Fund's performance information assumes reinvestment of all dividends and includes all Fund expenses, but does not reflect the impact of taxes. Performance data quoted represent past performance, which is not a guarantee of future results, and current performance may be lower or higher than the performance quoted. Both the return from and the principal value of an investment in the Fund will fluctuate so that any investor's shares, when redeemed, may be worth more or less than their original cost. To obtain performance as of the most recent month-end, please contact Firsthand Funds by calling 1.888.884.2675 or go to www.firsthandfunds.com.

The Fund's total gross operating expenses are 1.86%. The Fund's total net operating expenses are 1.85%. Under the Investment Advisory Agreements, the Investment Adviser has agreed to reduce its fees and/or make expense reimbursements so that the Fund's total operating expenses (excluding independent trustees' compensation, brokerage and commission expenses, litigation costs and any extraordinary and non-recurring expenses) are limited to 1.85% of the Fund's average daily net assets up to $200 million, 1.80% of such assets from $200 million to $500 million, 1.75% of such assets from $500 million to $1 billion, and 1.70% of such assets in excess of $1 billion. The current expense waiver is in effect until 8/31/19.

Growth of a Hypothetical $10,000 Investment

September 30, 1999 through September 30, 2018

Chart represents the growth of a hypothetical $10,000 investment from Firsthand Technology Opportunities Fund inception date until the end of the quarter indicated. Firsthand Technology Opportunities Fund performance assumes reinvestment of all dividends and includes all Firsthand Technology Opportunities Fund expenses but does not reflect the impact of taxes.

Q3 '18 Contributors to Performance

Streaming media device giant Roku (ROKU) was the top contributor to Fund performance during the third quarter. The company reported solid Q2 earnings in August that beat analyst expectations, with revenue up 57% and its user base up 46% year over year. Roku also reported that users are spending more time streaming, with total hours up 57% year over year. Roku finished Q3 up 71.35%.

Another top contributor was Twilio (TWLO), a cloud communications platform provider, which saw shares finish the third quarter up 54.02%. While Wall Street expected a five cent loss on second-quarter earnings, the company delivered a three-cents-per-share gain on revenue that also beat expectations.

Online dating heavyweight Match Group (MTCH) rounds out the top three contributors to Fund performance this quarter, with shares gaining 49.48% during Q3. Match Group owns several of the most popular online dating sites, including Tinder, PlentyOfFish, OkCupid, and Match.com. Tinder's growth numbers were a strong contributor to Match's performance during the quarter, with Q2 year-over-year subscriber growth of 81%. Additionally, premium versions of Match Group's dating sites are gaining in popularity, helping the company's revenue increase 36% year-over-year.

Q3 '18 Detractors from Performance

The largest detractor from Fund performance for Q3 was Facebook (FB), shares of which fell 15.37% during the quarter. The social networking giant saw its slowest-ever user growth during the second quarter, in part due to the "fake news" scandal and privacy issues. Monthly user growth was up just 1.54% (compared to 3.14% in Q1).

Tencent Holdings (TCEHY) was another negative contributor to Fund performance for the third quarter. The Chinese internet giant saw its shares slide 17.73% during the quarter on worries that the Chinese government's increasing regulation of online gaming will slow Tencent's growth. In addition to regulators halting the sale of "Monster Hunter: World," it has been reported that Chinese regulators have frozen game approvals as well.

Although beating analyst expectations for its fiscal fourth quarter, Nutanix (NTNX) offered a weaker-than-expected outlook for fiscal Q1 2019. The hyperconverged infrastructure company is seeing increased competition from heavy hitters including Google and IBM; such investor concerns helped send the stock down 17.16% in the third quarter.

Firsthand Technology Opportunities Fund is subject to greater risk than more diversified funds because of its investments in fewer securities and because of its concentration of investments in certain industries in the technology sector. Specific risks associated with investments in the technology industries (as described in the Fund's Prospectus) could cause the Fund's share price to fluctuate dramatically. The Fund's investments in small-cap companies present greater risk than investments in larger companies. The Fund invests in several industries within the technology sector and the relative weightings of these industries in the Fund's portfolio may change at any time. Equity investing involves risks, including the potential loss of the principal amount invested.

The NASDAQ Composite Index (NASDAQ) and the Standard & Poor's 500 Index (S&P 500) each represent an unmanaged, broad-based basket of stocks and are typically used as benchmarks for overall market performance. The indices' performance figures assume the reinvestment of all dividends (except where noted), but do not reflect the impact of taxes. Additionally, because an investor cannot invest in an index directly, indices' performance figures do not reflect the expenses associated with the management of an actual mutual fund portfolio.

As of 9/30/18: FB (3.58% of TEFQX), GOOG (2.32% of TEFQX), MTCH (2.80% of TEFQX), NTNX (5.17% of TEFQX), ROKU (8.48% of TEFQX), TCEHY (4.90% of TEFQX), TWLO (5.85% of TEFQX). As of 9/30/18, IBM was not held in any Firsthand Funds portfolio. A complete list of portfolio holdings for Firsthand Funds is available on www.firsthandfunds.com and is updated 45 days after the end of every calendar quarter. The portfolio holdings discussed are subject to change.

The information provided should not be considered a recommendation to purchase or sell a particular security and there is no assurance that, as of the date of publication, the securities purchased remain in a Fund's portfolio or that securities sold have not been repurchased. Also, you should note that the securities discussed, even if they have been purchased by a Fund, do not represent a Fund's entire portfolio and, in the aggregate, may represent only a small percentage of that Fund's holdings. There can be no assurance that any Firsthand Funds will buy, sell, or hold any particular security after the date referred to in the discussion.