Portfolio Holdings

There are risks involved with investing, including loss of principal. Past performance does not guarantee future results, share prices will fluctuate, and you may have a gain or loss when you redeem shares.

You should consider the investment objectives, risks, charges and expenses of the Forward Funds carefully before investing. A prospectus with this and other information may be obtained by calling (800) 999-6809 or by downloading here. It should be read carefully before investing.

An investment in the Forward U.S. Government Money Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in this fund.

Each Allocation Fund is a fund of funds, which is a mix of underlying Forward Funds. Shareholders of an Allocation Fund indirectly bear the expenses of the underlying funds. An Allocation Fund’s allocations may be changed at any time. Asset allocation does not assure profit.

Borrowing for investment purposes creates leverage, which can increase the risk and volatility of a fund. (International Real Estate, Credit Analysis Long/Short, Real Estate Long/Short, Tactical Enhanced, Tactical Growth)

Exposure to the commodities markets may subject a fund to greater volatility than investments in traditional securities. The value of commodity-linked derivative instruments may be affected by changes in overall market movements, commodity index volatility, changes in interest rates, or factors affecting a particular industry or commodity such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and regulatory developments. (Commodity Long/Short, Extended MarketPlus)

A fund that concentrates in a particular industry will involve a greater degree of risk than a fund with a more diversified portfolio. (Banking and Finance, Global Infrastructure, International Real Estate, Real Estate, Select Income, Real Estate Long/Short)

A fund’s use of derivative instruments involves risks different from the risks associated with investing directly in securities and certain derivatives may create a risk of loss greater than the amount invested. Derivatives increase volatility and transaction costs and may reduce performance. (Commodity Long/Short, Emerging Markets, Frontier Strategy, High Yield Bond, EM Corporate Debt, Investment Grade Fixed-Income, Credit Analysis Long/Short, Extended MarketPlus, Strategic Alternatives, Tactical Enhanced, Tactical Growth)

A fund that invests in ETFs will be subject to substantially the same risks as those associated with the direct ownership of the securities or other property held by the ETFs. (Commodity Long/Short, Strategic Alternatives, Tactical Enhanced, Tactical Growth)

Foreign securities, especially emerging or frontier markets, will involve additional risks including exchange rate fluctuations, social and political instability, less liquidity, greater volatility, and less regulation. (Emerging Markets, Focus, Frontier Strategy, Global Infrastructure, International Dividend, International Equity, International Real Estate, International Small Companies, Credit Analysis Long/Short, Small Cap Equity, Strategic Alternatives, Real Estate Long/Short, Tactical Enhanced, Tactical Growth)

Investing in lower-rated (“high yield”) debt securities involves special risks in addition to the risks associated with investments in higher-rated debt securities, including a high degree of credit risk. (High Yield Bond, EM Corporate Debt, Credit Analysis Long/Short)

Mortgage-backed securities do not have a fixed maturity, and their expected maturities may vary when interest rates rise or fall. Mortgage-backed securities are subject to prepayment risk and are subject to extension risk, which is the risk that a fund that holds mortgage-backed securities may exhibit additional volatility during periods of rising interest rates. Small movements in interest rates may quickly and significantly reduce the value of certain mortgage-backed securities. (Commodity Long/Short, Investment Grade Fixed-Income, Extended MarketPlus)

A “non-diversified” fund has the ability to invest a larger percentage of its assets in the securities of a smaller number of issuers than a “diversified“ fund. The net asset value per share of a non-diversified fund can be expected to fluctuate more than that of a comparable diversified fund. (Commodity Long/Short, Frontier Strategy, Global Infrastructure, EM Corporate Debt, International Real Estate, Credit Analysis Long/Short, Real Estate, Select Income, Strategic Alternatives, Real Estate Long/Short)

A fund that concentrates its investments in opportunities in the real estate industry or otherwise invests in real estate-related securities is subject to the risks associated with direct ownership of real estate. Real estate values can fluctuate as a result of general and local economic conditions, over-building and increased competition, increases in property taxes and operating expenses, changes in zoning laws, casualty or condemnation losses, regulatory limitations on rents, changes in neighborhood values, increases in interest rates, and defaults by borrowers or tenants. The value of equities that service the real estate business sector may also be affected by such risks. (International Real Estate, Real Estate, Select Income, Strategic Alternatives, Real Estate Long/Short)

A fund’s use of short selling involves additional investment risks and transaction costs, and creates leverage, which can increase the risk and volatility of a fund. (Credit Analysis Long/Short, Real Estate Long/Short, Tactical Enhanced, Tactical Growth)

Investing in smaller companies generally will present greater investment risks, including greater price volatility, greater sensitivity to changing economic conditions and less liquidity than the securities of larger, more mature companies. (Banking and Finance, Focus, Growth, International Equity, International Small Companies, Small Cap Equity, Extended MarketPlus)

By investing in a subsidiary organized under the laws of the Cayman Islands, the fund will be indirectly exposed to the risks associated with the subsidiary’s investments, which are generally similar to those that are permitted to be held by the fund. The subsidiary is not registered under the Investment Company Act of 1940. (Commodity Long/Short)

The Forward Tactical Enhanced Fund and Forward Commodity Long/Short Fund were launched on December 31, 2010, and have a limited operating history.

Prior to May 1, 2011 the Forward Extended MarketPlus Fund was named the Forward SMIDPlus Fund.

Prior to May 1, 2011 the Forward Frontier Strategy Fund was named the Forward MarketStrat Fund.

Prior to May 1, 2011 the Forward EM Corporate Debt Fund was named the Forward International Fixed Income Fund.

Prior to May 1, 2011 the Forward Credit Analysis Long/Short Fund was named the Forward Long/Short Credit Analysis Fund.

Prior to May 1, 2011 the Forward Real Estate Long/Short Fund was named the Forward Strategic Realty Fund.

Prior to January 20, 2011 the Forward CorePlus Fund was named the Forward Large Cap Growth Fund.

Effective November 1, 2011 the Forward Large Cap Equity Fund was renamed the Forward Large Cap Dividend Fund.

These holdings may not reflect the current or future positions in the portfolio. Current or future portfolio holdings are subject to risk. Portfolio holdings are subject to change.