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Principal Funds Launches Principal Small-MidCap Dividend Income Fund

Fund seeks to generate and grow dividend income for investors

September 14, 2011 (Des Moines, Iowa) – With markets remaining volatile and fixed-income yields remaining historically low, the ability to generate both income and capital appreciation is top-of-mind for many investors.
Designed to generate and grow an income stream, Principal Funds has launched the Principal Small-MidCap Dividend Income Fund (PMDAX). The fund invests in companies that have the capacity and commitment to deliver and consistently grow dividends over time for shareholders.

“Small- and mid-sized companies are typically overlooked by Wall Street and may provide higher dividend yields than their large-cap counterparts,” said Dan Coleman, portfolio manager and head of equities for Edge Asset Management, a Principal Funds subadvisor and wholly owned subsidiary of the Principal Financial Group®. “They also offer attractive capital appreciation opportunities as these companies grow from small-cap to large-cap.”

The fund, launched June 6, 2011, offers exposure to small- and mid-cap dividend paying companies. The goal is to provide a complement to a diversified portfolio.

A recent white paper from Principal Funds outlines the income and capital appreciation potential that dividend-producing stocks can provide. The paper takes a historic look at how stocks that pay dividends have outperformed non-dividend payers through both up and down markets. In fact, dividend-producing stocks in the S&P 500 outperform non-payers 66 percent of the time.[1] It concludes that dividend investing is a solid strategy because of significant market forces supporting the attractiveness of an equity income stream. 

About Principal Funds

Principal Funds is a leading provider of mutual funds, with $71.2 billion in assets under management.[2] Principal Funds brings expertise in global investment management, asset allocation and retirement leadership to financial professionals and investors. Including its target-risk and target-date offerings, Principal Funds is the fifth largest manager of lifecycle funds in the industry.[3] The companies that make up Principal Funds are members of the Principal Financial Group®. For more information, visit

About Edge Asset Management

Edge Asset Management (Edge) has been a pioneer in the field of actively managed asset allocation funds and is a leading fundamental manager delivering equity and fixed income products focused on total return and income. Edge has $20.6 billion in assets under management[4] across all its investment strategies. Based in Seattle, the firm has a heritage dating back to 1939 when it launched one of the first 50 mutual funds in the United States. Edge is an affiliate of Principal Global Investors, the asset management arm of the Principal Financial Group®.

About the Principal Financial Group

The Principal Financial Group® (The Principal®)[5] is a retirement and global asset management leader. The Principal offers businesses, individuals and institutional clients a wide range of financial products and services, including retirement, investment services and insurance through its diverse family of financial services companies. A member of the FORTUNE 500®, the Principal Financial Group has $335.8 billion in assets under management[6] and serves some 16.5 million customers worldwide from offices in Asia, Australia, Europe, Latin America and the United States. Principal Financial Group, Inc. is traded on the New York Stock Exchange under the ticker symbol PFG.

Diversification does not guarantee a profit or protect against a loss. Small-cap stocks may have additional risks, including greater price volatility.

Investors should carefully consider a fund’s investment objectives, risks, charges, and expenses prior to investing. A prospectus, or summary prospectus if available, containing this and other information can be obtained by contacting a financial professional, visiting, or calling 800.222.5852. Read the prospectus carefully before investing.

A mutual fund's share price and investment return will vary with market conditions, and the principal value of an investment when you sell your shares may be more or less than the original cost.

Principal Funds, Inc. is distributed by Principal Funds Distributor, Inc., member of the Principal Financial Group®. Principal Funds Distributor, Principal Shareholder Services, Principal Management Corporation and its affiliates, and Principal Funds, Inc. are collectively referred to as Principal Funds.


Ned Davis Research, Inc. (as of December 31, 2010)
As of June 30, 2011. Includes all share classes of the Principal Funds, Inc. and Principal Variable Contracts Funds, Inc.
FRC Mutual Fund Lifecycle Report 2Q11.
As of June 30, 2011.
“The Principal Financial Group” and “The Principal” are registered service marks of Principal Financial Services, Inc., a member of the Principal Financial Group.
As of June 30, 2011.

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Call 515.246.4907 or see the full Media Relations contact list.

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