of these mortgage-backed and asset-backed securities
differ from traditional fixed-income securities. Mortgage-backed securities are subject to “prepayment
risk” and “extension risk.” Prepayment risk is the risk that, when interest rates fall,
certain types of obligations will be paid off by the obligor more quickly than originally anticipated and the
Portfolio may have to invest the proceeds in securities with lower yields. Extension risk is the risk that,
when interest rates rise, certain obligations will be paid off by the obligor more slowly than anticipated,
causing the value of these securities to fall. Small movements in interest rates (both increases and decreases)
may quickly and significantly reduce the value of certain mortgage-backed securities. These securities also are
subject to risk of default on the underlying mortgage, particularly during periods of economic
downturn.
Management Risk. The Portfolio is subject to management risk because it is an actively-managed investment portfolio. The Portfolio’s portfolio managers apply investment techniques and risk analyses in making
investment decisions, but there can be no guarantee that these decisions or the individual securities selected
by the portfolio managers will produce the desired results.
Market Risk. The Portfolio’s share price or the market as a whole can decline for many reasons or be adversely affected by a number of factors, including, without limitation: weakness in the broad market, a particular industry, or specific holdings; adverse political, regulatory or economic developments in the United States or abroad; changes in investor psychology; heavy institutional selling;
military confrontations, war, terrorism and other armed conflicts, disease/virus outbreaks and epidemics;
recessions; taxation and international tax treaties; currency, interest rate and price fluctuations; and other
conditions or events. In addition, the subadviser’s assessment of securities held in the Portfolio may
prove incorrect, resulting in losses or poor performance even in a rising market.
Issuer Risk. The value of a security may decline for a number of reasons directly related to the issuer, such as management performance, financial leverage and reduced demand for the issuer’s goods and services.
Active Trading Risk. The Portfolio may engage in frequent trading of securities to achieve its investment goal. Active trading may result in high portfolio turnover and correspondingly greater brokerage commissions and other transaction costs, which will be borne directly by the
Portfolio and could affect its performance. During periods of increased market volatility, active trading may be more pronounced.
As a result of a reorganization which occurred on November 8, 2021 (the
“Reorganization”), the Portfolio acquired all of the assets and liabilities of the SA Wellington
Government and Quality Bond Portfolio (the “Predecessor Portfolio”), a series of Anchor Series
Trust. The performance information below is based on the performance of the Predecessor Portfolio for
periods prior to the date of the Reorganization. The Predecessor Portfolio had the same investment goal,
strategies, portfolio management team and contractual fees and expenses as the Portfolio as of the date of the
Reorganization. As a result, the performance of the Portfolio would have been substantially similar to that of
the Predecessor Portfolio.
The following bar chart illustrates the risks of investing in the Portfolio by showing changes in the
Portfolio’s performance from calendar year to calendar year and the table compares the Portfolio’s
average annual returns to those of the Bloomberg U.S. Aggregate Bond Index (a broad-based securities market
index) and the Bloomberg U.S. Aggregate A or Better Index, which is relevant to the Portfolio because it has
characteristics similar to the Portfolio’s investment strategies. Fees and expenses incurred at the contract level are not reflected in the bar chart or table. If these amounts were reflected, returns would be less than those shown. Of course, past
performance is not necessarily an indication of how the Portfolio will perform in the future.