Baron Partners Fund NCSR Certified annual shareholder report (management investment company)


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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-21296

BARON SELECT FUNDS

(Exact Name of Registrant as Specified in Charter)

767 Fifth Avenue, 49th Floor

New York, NY 10153

(Address of Principal Executive Offices) (Zip Code)

Patrick M. Patalino, General Counsel

c/o Baron Select Funds

767 Fifth Avenue, 49th Floor

New York, NY 10153

(Name and Address of Agent for Service)

(Registrant’s Telephone Number, including Area Code): 212-583-2000

Date of fiscal year end: December 31

Date of reporting period: December 31, 2016

Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17CRF 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 5th Street, NW, Washington, D.C. 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. Section 3507.

Persons who are to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.

SEC 2569 (5-07)

Item 1. Reports to Stockholders.

Baron Partners Fund

Baron Focused Growth Fund

Baron International Growth Fund

Baron Real Estate Fund

Baron Emerging Markets Fund

Baron Energy and Resources Fund

Baron Global Advantage Fund

December 31, 2016

Baron Funds^®

Annual Financial Report


Baron Partners Fund
*Ticker Symbols:*
Retail Shares: BPTRX
Institutional Shares: BPTIX
R6 Shares: BPTUX
Performance			2
Top Ten Holdings			3
Sector Breakdown			3
Management’s Discussion of Fund Performance			3
Baron Focused Growth Fund
*Ticker Symbols:*
Retail Shares: BFGFX
Institutional Shares: BFGIX
R6 Shares: BFGUX
Performance			4
Top Ten Holdings			5
Sector Breakdown			5
Management’s Discussion of Fund Performance			5
Baron International Growth Fund
*Ticker Symbols:*
Retail Shares: BIGFX
Institutional Shares: BINIX
R6 Shares: BIGUX
Performance			6
Top Ten Holdings			7
Sector Breakdown			7
Management’s Discussion of Fund Performance			7
Baron Real Estate Fund
*Ticker Symbols:*
Retail Shares: BREFX
Institutional Shares: BREIX
R6 Shares: BREUX
Performance			8
Top Ten Holdings			9
Sector Breakdown			9
Management’s Discussion of Fund Performance			9
Baron Emerging Markets Fund
*Ticker Symbols:*
Retail Shares: BEXFX
Institutional Shares: BEXIX
R6 Shares: BEXUX
Performance			10
Top Ten Holdings			11
Sector Breakdown			11
Management’s Discussion of Fund Performance			11
Baron Energy and Resources Fund
*Ticker Symbols:*
Retail Shares: BENFX
Institutional Shares: BENIX
R6 Shares: BENUX
Performance			12
Top Ten Holdings			13
Sector Breakdown			13
Management’s Discussion of Fund Performance			13
Baron Global Advantage Fund
*Ticker Symbols:*
Retail Shares: BGAFX
Institutional Shares: BGAIX
R6 Shares: BGLUX
Performance			14
Top Ten Holdings			15
Sector Breakdown			15
Management’s Discussion of Fund Performance			15
Financial Statements
Statements of Net Assets			16
Statements of Assets and Liabilities			27
Statements of Operations			29
Statements of Changes in Net Assets			31
Statement of Cash Flows			34
Notes to Financial Statements			35
Financial Highlights			44
Report of Independent Registered Public Accounting Firm			51
Tax Information			52
Fund Expenses			53
Management of the Funds			55

DEAR BARON SELECT FUNDS SHAREHOLDER:

In this report, you will find audited financial statements for Baron Partners Fund, Baron Focused Growth Fund, Baron International Growth Fund, Baron Real Estate Fund, Baron Emerging Markets Fund, Baron Energy and Resources Fund and Baron Global Advantage Fund (the “Funds”) for the year ended December 31, 2016. The U.S. Securities and Exchange Commission (the “SEC”) requires mutual funds to furnish these statements semi-annually to their shareholders. We hope you find these statements informative and useful.

We thank you for choosing to join us as fellow shareholders in Baron Funds. We will continue to work hard to justify your confidence.

Sincerely,

Ronald Baron

Chief Executive Officer and

Chief Investment Officer

February 24, 2017

Linda S. Martinson

Chairman, President and

Chief Operating Officer

February 24, 2017

Peggy Wong

Treasurer and

Chief Financial Officer

February 24, 2017

This Annual Financial Report is for the Baron Select Funds, which currently has seven series: Baron Partners Fund, Baron Focused Growth Fund, Baron International Growth Fund, Baron Real Estate Fund, Baron Emerging Markets Fund, Baron Energy and Resources Fund and Baron Global Advantage Fund. If you are interested in Baron Investment Funds Trust, which contains the Baron Asset Fund, Baron Growth Fund, Baron Small Cap Fund, Baron Opportunity Fund, Baron Fifth Avenue Growth Fund and Baron Discovery Fund series, please visit the Funds’ website at www.BaronFunds.com or contact us at 1-800-99BARON.

The Funds’ Proxy Voting Policy is available without charge and can be found on the Funds’ website at www.BaronFunds.com, by clicking on the “Legal Notices” link at the bottom left corner of the homepage or by calling 1-800-99BARON and on the SEC’s website at www.sec.gov. The Funds’ most current proxy voting record, Form N-PX, is also available on the Funds’ website and on the SEC’s website.

The Funds file their complete schedules of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Forms N-Q are available on the SEC’s website at www.sec.gov. The Funds’ Forms N-Q may also be reviewed and copied at the SEC’s Public Reference Room in Washington, DC; information on the operation of the SEC’s Public Reference Room may be obtained by calling 1-202-551-8090. A copy of the Funds’ Forms N-Q may also be obtained upon request by calling 1-800-99BARON. Schedules of portfolio holdings current to the most recent quarter are also available on the Funds’ website.

Some of the comments are based on current management expectations and are considered “forward-looking statements.” Actual future results, however, may prove to be different from our expectations. You can identify forward-looking statements by words such as “estimate,” “may,” “expect,” “should,” “could,” “believe,” “plan” and other similar terms. We cannot promise future returns and our opinions are a reflection of our best judgment at the time this report is compiled.

The views expressed in this report reflect those of BAMCO, Inc. (“BAMCO” or the “Adviser”) only through the end of the period stated in this report. The views are not intended as recommendations or investment advice to any person reading this report and are subject to change at any time without notice based on market and other conditions.

Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor’s shares, when redeemed, may be worth more or less than their original cost. For more complete information about Baron Funds, including charges and expenses, call, write or go to www.BaronFunds.com for a prospectus or summary prospectus. Read them carefully before you invest or send money. This report is not authorized for use as an offer of sale or a solicitation of an offer to buy shares of the Funds, unless accompanied or preceded by the Funds’ current prospectus or summary prospectus.

LOGO


Baron Partners Fund (Unaudited)		December 31, 2016

COMPARISONOFTHECHANGEIN VALUEOF $10,000INVESTMENTIN BARON PARTNERS FUND (RETAIL SHARES)

IN RELATIONTOTHE RUSSELL MIDCAP GROWTH INDEXANDTHE S&P 500 INDEX

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AVERAGE ANNUAL TOTAL RETURNSFORTHEPERIODSENDED DECEMBER 31, 2016
	One Year		Three Years		Five Years		Ten Years		Since Inception (January 31, 1992)
Baron Partners Fund — Retail Shares^1,2,3		4.04%		3.73%		13.91%		6.11%		12.14%
Baron Partners Fund — Institutional Shares^1,2,3,4		4.29%		4.00%		14.21%		6.32%		12.23%
Baron Partners Fund — R6 Shares^1,2,3,5		4.32%		4.01%		14.22%		6.33%		12.23%
Russell Midcap Growth Index¹		7.33%		6.23%		13.51%		7.83%		9.20%
S&P 500 Index¹		11.96%		8.87%		14.66%		6.95%		9.26%

The indexes are unmanaged. The Russell Midcap^® Growth Index measures the performance of medium-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large-cap U.S. companies. The indexes and Baron Partners Fund are with dividends, which positively impact the performance results.

Reflects the actual fees and expenses that were charged when the Fund was a partnership. The predecessor partnership charged a 20% performance fee after reaching a certain performance benchmark. If the annual returns for the Fund did not reflect the performance fees for the years the predecessor partnership charged a performance fee, returns would be higher. The Fund’s shareholders will not be charged a performance fee. The predecessor partnership’s performance is only for periods before the Fund’s registration statement was effective, which was April 30, 2003. During those periods, the predecessor partnership was not registered under the Investment Company Act of 1940 and was not subject to its requirements or the requirements of the Internal Revenue Code relating to regulated investment companies, which, if it were, might have adversely affected its performance.

Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. The Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower.

⁴

Performance for the Institutional Shares prior to May 29, 2009 is based on the performance of the Retail Shares, which have a distribution fee. The Institutional Shares do not have a distribution fee. If the annual returns for the Institutional Shares prior to May 29, 2009 did not reflect this fee, the returns would be higher.

⁵

Performance for the R6 Shares prior to August 31, 2016 is based on the performance of the Institutional Shares, and prior to May 29, 2009 is based on the Retail Shares, which have a distribution fee. The Institutional and R6 Shares do not have a distribution fee. If the annual returns for the R6 Shares prior to May 29, 2009 did not reflect this fee, the returns would be higher.


December 31, 2016 (Unaudited)		Baron Partners Fund

TOP TEN HOLDINGSASOF DECEMBER 31, 2016


	Percent of Total Investments
Tesla Motors, Inc.		11.6%
CoStar Group, Inc.		10.2%
Arch Capital Group Ltd.		10.1%
Vail Resorts, Inc.		7.3%
Hyatt Hotels Corp.		7.0%
FactSet Research Systems, Inc.		6.2%
IDEXX Laboratories, Inc.		5.7%
The Charles Schwab Corp.		5.4%
Zillow Group, Inc.		4.5%
Manchester United plc		3.7%
		71.7%

SECTOR BREAKDOWNASOF DECEMBER 31, 2016^†

(as a percentage of total investments)

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MANAGEMENT’S DISCUSSIONOF FUND PERFORMANCE

For the year ended December 31, 2016, Baron Partners Fund¹ gained 4.04%, underperforming the Russell Midcap Growth Index, which gained 7.33%.

The Fund has performed well since its conversion into an open end mutual fund on April 30, 2003. In the period since the Fund’s

conversion through December 31, 2016, the Fund gained an annualized 12.26% versus an annualized 10.81% for the Russell Midcap Growth Index. The Fund also has meaningfully outperformed the Russell Midcap Growth Index since its inception on January 31, 1992, gaining an annualized 12.14%* compared to an annualized 9.20% for the Russell Midcap Growth Index.

Baron Partners Fund invests primarily in U.S. companies of any size with, in our view, significant long-term growth potential. We believe our process can identify investment opportunities that are attractively priced relative to future prospects. The Fund is non-diversified, so its top 10 holdings are expected to comprise a significant percentage of the portfolio, and the Fund uses leverage, both of which increase risk.

The year started with a sell-off driven by concerns around a possible tightening of the credit markets, signs of slowing growth, particularly in China, and continued low oil prices. As global concerns subsided, oil prices ticked up, domestic job numbers improved, and the Federal Reserve deferred interest rate hikes, the markets recovered. In late June, the U.K.’s vote to exit the European Union sent the markets into another sharp, but thankfully short-lived, decline. In November, post-election expectations of corporate tax reform, less regulation, a stronger dollar, higher interest rates, and investment in infrastructure drove rotation into stocks, sectors, and asset classes that are expected to benefit from these developments.

At the sector level, the Fund’s investments in Financials, Real Estate, and Consumer Discretionary were the largest contributors to performance. Health Care and Utilities detracted from performance during the year.

The largest contributor was veterinary diagnostics leader IDEXX Laboratories, Inc. The stock rallied on robust financial results and multiple expansion. Competitive trends have been strong and improving, highlighted by instrument revenue growth of 22%, domestic lab growth more than twice that of its main competitor, rising sales productivity, and stability in rapid assays. We think that IDEXX’s direct go-to-market model and R&D-driven product enhancements will boost revenue and earnings growth over time.

The largest detractor was Illumina, Inc., the leading provider of next generation DNA sequencing platforms. Shares decreased in 2016 after the company reported disappointing financial results on weakness in Europe and weak high-throughput instrument sales in North America. We exited our position.

We expect to continue to establish long positions in securities that, in our opinion, have favorable price-to-value characteristics based on our assessment of their prospects for future growth and profitability.

†

Sector levels are provided from the Global Industry Classification Standard (“GICS”), developed and exclusively owned by MSCI, Inc. and Standard & Poor’s Financial Services LLC, unless otherwise stated that they have been reclassified or classified by the Adviser. All GICS data is provided “as is” with no warranties.

¹	Performance information reflects results of the Retail Shares.

*	Please see Footnote 2 on page 2.


Baron Focused Growth Fund (Unaudited)		December 31, 2016

COMPARISONOFTHECHANGEIN VALUEOF $10,000INVESTMENTIN BARON FOCUSED GROWTH FUND^† (RETAIL SHARES)
INRELATIONTOTHE RUSSELL 2500 GROWTH INDEXANDTHE S&P 500 INDEX

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AVERAGE ANNUAL TOTAL RETURNSFORTHEPERIODSENDED DECEMBER 31, 2016
	One Year		Three Years		Five Years		Ten Years		Since Inception (May 31, 1996)
Baron Focused Growth Fund — Retail Shares^1,2,3		0.67%		0.18%		7.95%		5.44%		10.24%
Baron Focused Growth Fund — Institutional Shares^1,2,3,4		0.97%		0.45%		8.22%		5.64%		10.34%
Baron Focused Growth Fund — R6 Shares^1,2,3,5		0.97%		0.44%		8.22%		5.64%		10.34%
Russell 2500 Growth Index¹		9.73%		5.45%		13.88%		8.24%		7.30%
S&P 500 Index¹		11.96%		8.87%		14.66%		6.95%		8.05%

†	The Fund’s historical performance was impacted by gains from IPOs and/or secondary offerings. There is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs and secondary offerings will be the same in the future.

The indexes are unmanaged. The Russell 2500™ Growth Index measures the performance of small to medium-sized U.S. companies that are classified as growth and the S&P 500 Index of 500 widely held large-cap U.S. companies. The indexes and Baron Focused Growth Fund are with dividends, which positively impact the performance results.

Reflects the actual fees and expenses that were charged when the Fund was a partnership. The predecessor partnership charged a 15% performance fee through 2003 after reaching a certain performance benchmark. If the annual returns for the Fund did not reflect the performance fees for the years the predecessor partnership charged a performance fee, the returns would be higher. The Fund’s shareholders will not be charged a performance fee. The predecessor partnership’s performance is only for periods before the Fund’s registration statement was effective, which was June 30, 2008. During those periods, the predecessor partnership was not registered under the Investment Company Act of 1940 and was not subject to its requirements or the requirements of the Internal Revenue Code relating to regulated investment companies, which, if it were, might have adversely affected its performance.

Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. The Adviser has reimbursed certain Fund expenses (by contract as long as BAMCO, Inc. is the Adviser to the Fund) and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower.

⁴

⁵


December 31, 2016 (Unaudited)		Baron Focused Growth Fund

TOP TEN HOLDINGSASOF DECEMBER 31, 2016


	Percent of Net Assets
Vail Resorts, Inc.		12.5%
Tesla Motors, Inc.		11.0%
Hyatt Hotels Corp.		10.7%
CoStar Group, Inc.		8.1%
FactSet Research Systems, Inc.		7.0%
Arch Capital Group Ltd.		4.9%
Choice Hotels International, Inc.		4.8%
Manchester United plc		4.5%
Iridium Communications Inc.		4.4%
Benefitfocus, Inc.		3.8%
		71.7%

SECTOR BREAKDOWNASOF DECEMBER 31, 2016^†

(as a percentage of net assets)

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MANAGEMENT’S DISCUSSIONOF FUND PERFORMANCE

For year ended December 31, 2016, Baron Focused Growth Fund¹ increased 0.67%, underperforming the Russell 2500 Growth Index, which rose 9.73%. In the period since the Fund’s conversion into an open end mutual fund on June 30, 2008 through December 31, 2016, the Fund gained an annualized 5.83% versus an annualized 9.63% for that index.

Since its inception on May 31, 1996 through December 31, 2016, the Fund has outperformed the Russell 2500 Growth Index, gaining an annualized 10.24%* compared to an annualized 7.30% for that index.

Baron Focused Growth Fund invests in a non-diversified portfolio of companies that we believe are well capitalized, and have exceptional management, significant growth potential, and sustainable barriers to competition. The Fund is non-diversified, which is a riskier investment strategy.

At the sector level, the Fund’s investments in Consumer Discretionary, Financials and Telecommunication Services were the largest contributors to performance. Information Technology, Industrials and Health Care were the biggest sector detractors.

The largest contributor was ski resort company Vail Resorts, Inc. Shares rose after the company’s acquisition of Whistler Blackcomb resulted in a significant improvement in season pass sales and skier visitation across the company’s resorts. In addition, Vail reported improving results at its recently acquired resorts in Perisher, Australia and Park City, Utah.

The largest detractor was Manchester United plc, an English Premier League professional sports team that generates revenue from broadcasting, sponsorship, and licensing. Shares were down despite enthusiasm around the hiring of Jose Mourinho as the new coach and the addition of marquee players to the roster. We continue to believe that Manchester United is a unique media company with broad global appeal and look forward to news of anticipated future sponsorship deals, the roll-out of new merchandise agreements, and a new digital offering that is under development.

We expect to continue to establish positions in small and mid-sized businesses that, in our opinion, have favorable price-to-value characteristics based on our assessment of prospects for future growth and profitability.

†

¹	Performance information reflects results of the Retail Shares.

*	Please see Footnote 2 on page 4.


Baron International Growth Fund (Unaudited)		December 31, 2016

COMPARISONOFTHECHANGEIN VALUEOF $10,000INVESTMENTIN BARON INTERNATIONAL GROWTH FUND^† (RETAIL SHARES)

INRELATIONTOTHE MSCI ACWIEX USA IMI GROWTH INDEXANDTHE MSCI ACWIEX USA INDEX

LOGO


AVERAGE ANNUAL TOTAL RETURNSFORTHEPERIODSENDED DECEMBER 31, 2016
	One Year		Three Years		Five Years		Since Inception (December 31, 2008)
Baron International Growth Fund — Retail Shares^1,2		1.14%		0.00%		7.46%		10.07%
Baron International Growth Fund — Institutional Shares^1,2,3		1.35%		0.24%		7.73%		10.33%
Baron International Growth Fund — R6 Shares^1,2,4		1.35%		0.24%		7.73%		10.33%
MSCI ACWI ex USA IMI Growth Index¹		0.06%		(1.00)%		5.58%		7.83%
MSCI ACWI ex USA Index¹		4.50%		(1.78)%		5.00%		7.11%

†	The Fund’s historical performance was impacted by gains from IPOs and/or secondary offerings. There is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs and secondary offerings will be the same in the future.

The MSCI ACWI ex USA indexes cited are unmanaged, free float-adjusted market capitalization weighted indexes. The MSCI ACWI ex USA IMI Growth Index Net USD measures the performance of large-, mid- and small-cap growth securities across developed and emerging markets, excluding the United States. The MSCI ACWI ex USA Index Net USD measures the equity market performance of large and mid-cap securities across developed and emerging markets, excluding the United States. The indexes and Baron International Growth Fund include reinvestment of dividends, net of foreign withholding taxes, which positively impact the performance results.

Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. The Adviser has reimbursed certain Fund expenses (by contract as long as BAMCO, Inc. is the Adviser to the Fund) and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower.

⁴


December 31, 2016 (Unaudited)		Baron International Growth Fund

TOP TEN HOLDINGSASOF DECEMBER 31, 2016


	Percent of Net Assets
Eurofins Scientific SE		3.4%
Softbank Group Corp.		2.9%
Constellation Software, Inc.		2.7%
Arch Capital Group Ltd.		2.7%
Domino’s Pizza Enterprises Ltd.		2.6%
RIB Software AG		2.5%
Reckitt Benckiser Group Plc		2.2%
Abcam plc		2.2%
Julius Baer Group Ltd.		2.1%
Tencent Holdings, Ltd.		2.1%
		25.4%

SECTOR BREAKDOWNASOF DECEMBER 31, 2016^†

(as a percentage of net assets)

LOGO

MANAGEMENT’S DISCUSSIONOF FUND PERFORMANCE

For the year ended December 31, 2016, Baron International Growth Fund¹ gained 1.14%, outperforming the MSCI ACWI ex USA IMI Growth Index, which gained 0.06%.

Baron International Growth Fund is a diversified fund that invests for the long term primarily in securities of non-U.S. growth companies. The Fund expects to diversify among several

developed countries and developing countries throughout the world, although the Fund’s total exposure to developing countries will not exceed 30%. The Fund may purchase securities of companies of any size. Of course, there can be no guarantee that we will be successful in achieving the Fund’s investment goals.

Two clear inflection points dominated global market activity in 2016. First, the G20 meeting of the world’s central bankers in February marked a resynchronization of global monetary policy. Several international and particularly emerging markets currencies, equities, and commodities demonstrated a return to leadership. This trend was accentuated following Brexit. The second inflection point proved less friendly to international markets. Prior to the U.S. presidential election, several global policymakers had already signaled a tolerance for higher inflation. Trump’s election added fuel to the fire of rising inflation and interest rate expectations while opening a Pandora’s box of potential outcomes on fiscal and monetary policy, taxation, trade, protectionism, and foreign policy. Markets were clearly caught off guard by the U.S. election results, and a fairly dramatic repricing occurred in the final weeks of 2016.

On a sector basis, the largest contributors to performance were Materials, Energy, and Financials. Consumer Staples, Information Technology, and Consumer Discretionary were the largest detractors. On a regional basis, the largest contributors to performance were Asia/Pacific excluding Japan, North America, and Latin America. Europe and Japan detracted from performance.

The largest contributor was global gold mining company Newcrest Mining Ltd. Shares rose in 2016 in concert with a general rise in gold prices. The company also significantly cut its capital expenditures and increased free cash flow. We believe it is prudent to maintain a modest exposure to gold at this time. We are optimistic about Newcrest based on our outlook for gold pricing as well as the company’s improved operational performance, falling cost structure, and ramp up of production at its Cadia plant in Australia.

The largest detractor was low-cost European airline easyJet plc. Shares fell following the outcome of the Brexit vote and downward profit revisions. The company faced several operating challenges following air traffic control strikes and terrorist attacks, both of which weakened air travel demand. We concluded that the risk of significant regulatory change altered our investment thesis, and we sold the stock.

Should Trump’s policies remain a challenge for the international markets, we believe they are far better prepared to weather such a development than just a few years ago. Europe and Japan appear financially stable and are showing signs of an economic upturn on a lagged basis to the U.S. cycle. The U.K. is demonstrating solid domestic growth while a weaker currency is lending strength to export activity. We do not believe oil, other commodity prices, or emerging markets currencies will return to the lows of early 2016. We remain optimistic regarding the long-term potential for the high quality growth businesses in which we invest.

†

¹	Performance information reflects results of the Retail Shares.


Baron Real Estate Fund (Unaudited)		December 31, 2016

COMPARISONOFTHECHANGEIN VALUEOF $10,000INVESTMENTIN BARON REAL ESTATE FUND (RETAIL SHARES)

INRELATIONTOTHE MSCI USA IMI EXTENDED REAL ESTATE INDEXANDTHE S&P 500 INDEX

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AVERAGE ANNUAL TOTAL RETURNSFORTHEPERIODSENDED DECEMBER 31, 2016
	One Year		Three Years		Five Years		Since Inception (December 31, 2009)
Baron Real Estate Fund — Retail Shares^1,2		(2.01)%		2.90%		14.58%		14.09%
Baron Real Estate Fund — Institutional Shares^1,2		(1.75)%		3.17%		14.89%		14.37%
Baron Real Estate Fund — R6 Shares^1,2,3		(1.74)%		3.17%		14.89%		14.38%
MSCI USA IMI Extended Real Estate Index¹		8.24%		9.30%		14.26%		13.16%
S&P 500 Index¹		11.96%		8.87%		14.66%		12.83%

The indexes are unmanaged. The MSCI USA IMI Extended Real Estate Index is a custom index calculated by MSCI for, and as requested by, BAMCO, Inc. The index includes real estate and real estate-related GICS classification securities. MSCI makes no express or implied warranties or representation and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indexes or any securities or financial products. This report is not approved, reviewed or produced by MSCI. The S&P 500 Index measures the performance of 500 widely held large-cap U.S. companies. The indexes and Baron Real Estate Fund are with dividends, which positively impact the performance results.

Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. The Adviser has reimbursed certain Fund expenses (by contract as long as BAMCO, Inc. is the Adviser to the Fund) and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower.

³	Performance for the R6 Shares prior to January 29, 2016 is based on the performance of the Institutional Shares.


December 31, 2016 (Unaudited)		Baron Real Estate Fund

TOP TEN HOLDINGSASOF DECEMBER 31, 2016


	Percent of Net Assets
Mohawk Industries, Inc.		6.8%
MGM Resorts International		6.3%
InterXion Holding N.V.		6.1%
Equinix, Inc.		5.1%
American Tower Corp.		4.8%
Hilton Worldwide Holdings, Inc.		4.6%
Home Depot, Inc.		4.3%
CBRE Group, Inc.		3.8%
Macquarie Infrastructure Corporation		3.8%
Vulcan Materials Company		3.0%
		48.6%

SECTOR BREAKDOWNASOF DECEMBER 31, 2016^†

(as a percentage of net assets)

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MANAGEMENT’S DISCUSSIONOF FUND PERFORMANCE

For the year ended December 31, 2016, Baron Real Estate Fund¹ declined 2.01%, underperforming the MSCI USA IMI Extended Real Estate Index, which gained 8.24%. Since its inception on December 31, 2009 through December 31, 2016, the Fund has outperformed the MSCI USA IMI Extended Real Estate Index, generating an annualized return of 14.09%, compared with an annualized return of 13.16% for that index.

Baron Real Estate Fund is a non-diversified fund that, under normal circumstances, invests 80% of its net assets in real estate and real estate-related companies of all sizes, and in companies which, in the opinion of the Adviser, own significant real estate assets at the time of investment. The Fund seeks to invest in well-managed companies that we believe have significant long-term growth opportunities. The Fund’s investment universe extends beyond real estate investment trusts (REITs) to include hotels, senior housing operators, casino and gaming operators, tower operators, infrastructure-related companies and master limited partnerships (MLPs), data centers, building products companies, real estate service companies, and real estate operating companies. Of course, there can be no guarantee that we will be successful in achieving the Fund’s investment goals.

Certain factors have tempered results of Baron Real Estate Fund in recent years. These include: (i) the Fund’s relatively moderate allocation to REITs, which have benefited from historically low interest rates; (ii) a few investment missteps; and (iii) the strong performance of Home Depot, Inc. and Lowe’s Companies, Inc., which accounted for a combined 13% weighting in the benchmark versus the Fund’s more moderate 5% weighting. Performance in 2016 was also affected by geo-political events. Fears generated by terrorist acts and the Zika virus negatively impacted cruise line holdings. In addition, Brexit triggered widespread uncertainty regarding the prospects for commercial real estate services companies in Europe.

Our investments in REITs, casinos and gaming operators, and building products/services companies contributed the most to returns in the year. Real estate service companies, hotels & leisure, and tower operators and wireless telecommunication services were the largest detractors.

The top contributor was MGM Resorts International, an owner of casinos mainly in Las Vegas and Macau. The company reported strong earnings with robust revenue per available room and cost controls as part of its implementation of its profit growth plan. These strong earnings led to increased free cash flow which the company used for debt reduction. An improved balance sheet and enhanced growth from the openings of its National Harbor and Macau casinos also helped drive up the stock price.

The top detractor was commercial real estate services company Jones Lang LaSalle, Inc. The stock price fell over concerns that capital markets activity would slow dramatically and that the commercial real estate cycle is nearing its peak, given its exposure to the U.K. Brexit further weighed on the stock and we trimmed our position.

The possibility of lower taxes, less regulation, more fiscal spending, faster economic growth, and a normalization of interest rates could bode well for the Fund, in our view. We emphasize what we view as well-managed market leaders that generally possess quality balance sheets, own well-located real estate, and grow cash flow at a faster rate than most peers. We believe many of these high quality companies are also priced at discounts to our assessment of intrinsic value.

†

¹	Performance information reflects results of the Retail Shares.


Baron Emerging Markets Fund (Unaudited)		December 31, 2016

COMPARISONOFTHECHANGEIN VALUEOF $10,000INVESTMENTIN BARON EMERGING MARKETS FUND (RETAIL SHARES)
INRELATIONTOTHE MSCI EM IMI GROWTH INDEXANDTHE MSCI EM IMI INDEX

LOGO


AVERAGE ANNUAL TOTAL RETURNSFORTHEPERIODSENDED DECEMBER 31, 2016
	One Year		Three Years		Five Years		Since Inception (December 31, 2010)
Baron Emerging Markets Fund — Retail Shares^1,2		3.75%		(1.57)%		6.11%		1.82%
Baron Emerging Markets Fund — Institutional Shares^1,2		4.08%		(1.31)%		6.38%		2.07%
Baron Emerging Markets Fund — R6 Shares^1,2,3		4.17%		(1.27)%		6.40%		2.09%
MSCI EM IMI Growth Index¹		5.84%		(1.85)%		2.70%		(1.49)%
MSCI EM IMI Index¹		9.90%		(2.40)%		1.54%		(2.32)%

The MSCI EM (Emerging Markets) IMI indexes cited are unmanaged, free float-adjusted market capitalization indexes. The MSCI EM (Emerging Markets) IMI Growth Index Net USD and the MSCI EM (Emerging Markets) IMI Index Net USD are designed to measure equity market performance of large-, mid- and small-cap securities in the emerging markets. The MSCI EM (Emerging Markets) IMI Growth Index Net USD screens for growth-style securities. The indexes and Baron Emerging Markets Fund include reinvestment of dividends, net of foreign withholding taxes, which positively impact the performance results.

Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. The Adviser has reimbursed certain Fund expenses (by contract as long as BAMCO, Inc. is the Adviser to the Fund) and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent without which performance would have been lower.

³	Performance for the R6 Shares prior to January 29, 2016 is based on the performance of the Institutional Shares.


December 31, 2016 (Unaudited)		Baron Emerging Markets Fund

TOP TEN HOLDINGSASOF DECEMBER 31, 2016


	Percent of Net Assets
Alibaba Group Holding Limited		3.5%
Tencent Holdings, Ltd.		2.3%
Samsung Electronics Co., Ltd.		2.2%
Taiwan Semiconductor Manufacturing Company Ltd.		2.0%
Sberbank of Russia		1.9%
Copa Holdings, S.A.		1.7%
NAVER Corporation		1.6%
Magnit PJSC		1.5%
BM&FBOVESPA SA		1.5%
China Mobile Ltd.		1.4%
		19.6%

SECTOR BREAKDOWNASOF DECEMBER 31, 2016^†

(as a percentage of net assets)

LOGO

MANAGEMENT’S DISCUSSIONOF FUND PERFORMANCE

For the year ended December 31, 2016, Baron Emerging Markets Fund¹ gained 3.75%, underperforming the MSCI EM IMI Growth Index, which gained 5.84%.

Baron Emerging Markets Fund is a diversified fund that invests for the long term primarily in companies of any size that have their primary business activities or principal trading markets in developing countries. The Fund may invest up to 20% of its net assets in developed and frontier countries. The Fund seeks to invest in companies that we believe have significant long-term growth

prospects, and to purchase them at prices we believe to be favorable. Of course, there can be no guarantee that we will be successful in achieving the Fund’s investment goals.

Two clear inflection points dominated global market activity in 2016. First, the G20 meeting of the world’s central bankers in February marked a resynchronization of global monetary policy. emerging markets currencies, equities, and commodities demonstrated a return to leadership. This trend was accentuated following Brexit. The second major inflection point proved less friendly to emerging markets. Prior to the U.S. presidential election, several global policymakers had already signaled a tolerance for higher inflation. Trump’s election added fuel to the fire of rising inflation and interest rate expectations while opening a Pandora’s box of potential outcomes on fiscal and monetary policy, taxation, trade, protectionism, and foreign policy. Markets were clearly caught off guard by the U.S. election results, and a fairly dramatic repricing occurred in the final weeks of 2016.

On a country basis, holdings in Brazil, South Africa, and Russia contributed the most to performance. Investments in India, Mexico, and Taiwan were the biggest detractors.

On a sector basis, investments in Information Technology, Financials, and Industrials were the largest contributors. Investments in the Health Care and Consumer Staples sectors were the largest detractors.

The top contributor was Brazilian financial exchanges operator BM&FBOVESPA SA. Brazil’s capital markets and currency rallied on optimism that political reforms will result in economic improvement. Shares also benefited from the company’s announced acquisition of Cetip, creating a unified financial clearinghouse for the Brazilian capital markets. We expect the Cetip acquisition to create significant shareholder value, while longer-term development of the Brazilian capital markets will potentially lead to higher trading volumes.

Leading Indian manufacturer of complex active pharmaceutical ingredients Divi’s Laboratories Ltd., was the top detractor. The stock fell after a surprise FDA inspection of Divi’s manufacturing facilities resulted in unfavorable observations, creating near-term regulatory headwinds for the company. We retain conviction in Divi’s due to its industry-leading profitability and long-term relationships with major pharma clients. We believe the company is well positioned to sustain low-to-mid-teens earnings growth for the next three to five years.

Should Trump’s ultimate policy path remain a challenge for emerging markets, we believe they are far more prepared to weather such a development than just a few years ago. We think emerging markets corporate earnings have likely begun a cyclical recovery. We do not believe oil, other commodity prices and/or emerging markets currencies will return to the lows of early 2016, and we are confident the longer-term structural reforms and political redirection underway in key emerging markets countries will provide support and ultimately restore productivity and value creation. China, always a key barometer of emerging markets health, remains stable. We remain optimistic regarding the long-term potential for the high quality growth businesses in which we invest.

†

¹	Performance information reflects results of the Retail Shares.


Baron Energy and Resources Fund (Unaudited)		December 31, 2016

COMPARISONOFTHECHANGEIN VALUEOF $10,000INVESTMENTIN BARON ENERGYAND RESOURCES FUND^† (RETAIL SHARES)
INRELATIONTOTHE S&P NORTH AMERICAN NATURAL RESOURCES SECTOR INDEXANDTHE S&P 500 INDEX

LOGO


AVERAGE ANNUAL TOTAL RETURNSFORTHEPERIODSENDED DECEMBER 31, 2016
	One Year		Three Years		Five Years and Since Inception (December 31, 2011)
Baron Energy and Resources Fund — Retail Shares^1,2		28.02%		(8.71)%		(2.04)%
Baron Energy and Resources Fund — Institutional Shares^1,2		28.31%		(8.52)%		(1.83)%
Baron Energy and Resources Fund — R6 Shares^1,2,3		28.17%		(8.55)%		(1.85)%
S&P North American Natural Resources Sector Index¹		30.87%		(3.66)%		1.26%
S&P 500 Index¹		11.96%		8.87%		14.66%

†	The Fund’s historical performance was impacted by gains from IPOs and/or secondary offerings. There is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs and secondary offerings will be the same in the future.

The indexes are unmanaged. The S&P North American Natural Resources Sector Index measures the performance of U.S.-traded natural resources-related stocks, including mining, energy, paper and forest products, and plantation owning companies. The S&P 500 Index measures the performance of 500 widely held large-cap U.S. companies. The indexes and Baron Energy and Resources Fund are with dividends, which positively impact the performance results.

Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. The Adviser has reimbursed certain Fund expenses (by contract as long as BAMCO, Inc. is the Adviser to the Fund) and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower.

³	Performance for the R6 Shares prior to August 31, 2016 is based on the performance of the Institutional Shares.


December 31, 2016 (Unaudited)		Baron Energy and Resources Fund

TOP TEN HOLDINGSASOF DECEMBER 31, 2016


	Percent of Net Assets
RSP Permian, Inc.		6.9%
Parsley Energy, Inc.		6.5%
Encana Corp.		5.9%
Concho Resources, Inc.		5.8%
Newfield Exploration Co.		4.8%
Halliburton Co.		3.9%
Flotek Industries, Inc.		3.4%
Targa Resources Corp.		3.4%
Schlumberger Limited		3.0%
U.S. Silica Holdings, Inc.		2.9%
		46.5%

SECTOR BREAKDOWNASOF DECEMBER 31, 2016^†

(as a percentage of net assets)

LOGO

MANAGEMENT’S DISCUSSIONOF FUND PERFORMANCE

For the year ended December 31, 2016, Baron Energy and Resources Fund¹ rose 28.02%, underperforming the S&P North American Natural Resources Sector Index, which gained 30.87%.

The Fund is a non-diversified fund that, under normal circumstances, invests 80% of its net assets in U.S. and non-U.S. energy and resources companies and related companies and master limited partnerships (MLPs) of any market capitalization. The Fund invests primarily in U.S. securities and may invest up to 25% in non-U.S. securities. We select securities that we believe have favorable price-to-value characteristics, are well managed and appropriately financed, and have significant long-term growth prospects and competitive advantages. Of course, there can be no guarantee that we will be successful in achieving the Fund’s investment goals.

After a difficult start, 2016 proved to be a very good year to be invested in energy. It is our view that in 2016 we saw the trough of the energy recession that had begun in 2014, as well as the beginning of a potential multi-year cyclical recovery. Oil prices and equity prices reached low points in February and oilfield activity, investment and earnings reached lows in the middle of the year. We also saw bottoms in industrial and precious metals and other commodities, which coupled with the recovery in oil and natural gas prices led to robust stock performance across much of the energy and resource landscape in 2016.

The Fund’s investments in the oil & gas exploration & production, oil & gas equipment & services, and oil & gas storage & transportation sub-industries contributed the most to performance. The oil & gas refining & marketing, semiconductor equipment, and renewable electricity sub-industries detracted the most during the year.

Parsley Energy, Inc. was the largest contributor. Parsley is an independent exploration and production company focused on the Permian Basin in West Texas. Shares were up in 2016, driven by strong operational performance, raised production guidance, lowered cash costs, and a three-year growth outlook above Street estimates. The company also meaningfully boosted its drilling inventory in the Delaware sub-basin of the Permian through an acquisition. We expect Parsley to continue delivering peer-leading operational performance and growing its acreage footprint through accretive bolt-on acquisitions.

The top detractor was Marathon Petroleum Corp., one of the largest independent refining and marketing companies in the U.S., with operations focused on the Gulf Coast, Texas/Oklahoma and North Dakota. The share price fell in 2016 due to a combination of refining margins that missed Street expectations and investor concerns around growth prospects for Marathon subsidiary MPLX LP following MPLX’s acquisition of MarkWest Energy Partners LP. We chose to exit our position.

Our 2017 outlook remains optimistic. We believe the worst energy recession in a generation is over and the U.S. energy renaissance is alive and well. Finally, equity investors remain significantly underweight in their exposures to the Energy sector and, to a lesser extent, resource-related businesses.

†

¹	Performance information reflects results of the Retail Shares.


Baron Global Advantage Fund (Unaudited)		December 31, 2016

COMPARISONOFTHECHANGEIN VALUEOF $10,000INVESTMENTIN BARON GLOBAL ADVANTAGE FUND^† (RETAIL SHARES)

INRELATIONTOTHE MSCI ACWI GROWTH INDEXANDTHE MSCI ACWI INDEX

LOGO


AVERAGE ANNUAL TOTAL RETURNS FORTHEPERIODSENDED DECEMBER 31, 2016
	One Year		Three Years		Since Inception (April 30, 2012)
Baron Global Advantage Fund — Retail Shares^1,2		(1.15)%		0.70%		7.14%
Baron Global Advantage Fund — Institutional Shares^1,2		(0.93)%		0.91%		7.37%
Baron Global Advantage Fund — R6 Shares^1,2,3		(0.93)%		0.91%		7.37%
MSCI ACWI Growth Index Net¹		3.27%		3.40%		7.64%
MSCI ACWI Index Net¹		7.86%		3.13%		7.71%

†	The Fund’s historical performance was impacted by gains from IPOs and/or secondary offerings. There is no guarantee that these results can be repeated or that the Fund’s level of participation in IPOs and secondary offerings will be the same in the future.

The MSCI ACWI indexes cited are unmanaged, free float-adjusted market capitalization weighted indexes reflected in US dollars. The MSCI ACWI Growth Index Net USD measures the equity market performance of large- and mid-cap growth securities across developed and emerging markets. The MSCI ACWI Index Net USD measures the equity market performance of large- and mid-cap securities across developed and emerging markets. The indexes and Baron Global Advantage Fund include reinvestment of dividends, net of foreign withholding taxes, which positively impact the performance results.

Past performance is not predictive of future performance. The performance data does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemption of Fund shares. The Adviser has reimbursed certain Fund expenses (by contract as long as BAMCO, Inc. is the Adviser to the Fund) and the Fund’s transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower.

³	Performance for the R6 Shares prior to August 31, 2016 is based on the performance of the Institutional Shares.


December 31, 2016 (Unaudited)		Baron Global Advantage Fund

TOP TEN HOLDINGSASOF DECEMBER 31, 2016


	Percent of Net Assets
Amazon.com, Inc.		12.0%
Alibaba Group Holding Limited		5.9%
Alphabet Inc.		5.5%
Facebook, Inc.		5.4%
Constellation Software, Inc.		5.2%
TAL Education Group		5.0%
Naspers Limited		4.8%
JUST EAT plc		4.4%
Mellanox Technologies Ltd.		4.0%
Ctrip.com International, Ltd.		3.9%
		56.1%

SECTOR BREAKDOWNASOF DECEMBER 31, 2016^†

(as a percentage of net assets)

LOGO

MANAGEMENT’S DISCUSSIONOF FUND PERFORMANCE

For the year ended December 31, 2016, Baron Global Advantage Fund¹ lost 1.15%, underperforming the MSCI ACWI Growth Index, which rose 3.27%.

Baron Global Advantage Fund is a diversified fund that invests primarily in growth companies of any size located throughout the world. We have a long-term mindset, conduct bottom-up research, and believe insights and perspective are more important

than short-term events or results. We invest in companies that we believe have favorable price-to-value and risk/reward characteristics, have strong free cash flow and returns on capital, are well-managed, and have sustainable competitive advantages. Of course, there can be no guarantee that we will be successful in achieving the Fund’s investment goals.

The year started with a global sell-off driven by concerns around a possible tightening of the credit markets, signs of slowing growth, particularly in China, and continued low oil prices. As global concerns subsided and oil prices ticked up, the markets recovered. The resynchronization of global monetary policy in February also helped boost several international and particularly emerging markets currencies, equities, and commodities. This trend was accentuated following Brexit. Global markets continued a steady, mostly upward climb until the U.S. presidential election in November, when the markets were subject to a powerful rotation from global growth businesses, which are the companies we primarily invest in, into predominantly domestic cyclical and value stocks that investors expect to benefit from U.S. corporate tax cuts, infrastructure investments, military build-up, and trade protectionism.

On a sector basis, investments in Consumer Discretionary, Financials, and Energy were the top contributors to performance. Health Care and, to a lesser extent, Telecommunication Services and Utilities, were the top detractors. From a country perspective, holdings in China, Brazil, and Canada were the top contributors. Investments in the U.S., Indonesia, and the U.K. were the biggest detractors.

TAL Education Group, a leading K-12 tutoring company in China, was the largest contributor in 2016. Shares were driven up by more than 60% growth in student enrollments, the opening of new learning centers, entry to new cities, and expansion of existing learning centers. With less than 5% market share, we believe TAL has the potential to continue to gain share in a fragmented market.

The largest detractor was specialty pharmaceutical company Pacira Pharmaceuticals, Inc. In late 2014, the FDA’s attempt to limit certain promotional materials for Pacira’s main product EXPAREL had a negative impact into 2015. At the end of 2015, Pacira announced a favorable resolution that rescinded the FDA’s prior limitations and clarified EXPAREL’s label in a favorable way. While 2016 was a down year as it took longer than the company expected for sales to recover, we believe 2017 will show good sales acceleration.

The portfolio is constructed on a bottom-up basis, with the quality of ideas and conviction level being the most important determinants of the size of each individual investment. We look for what we believe are unique companies with sustainable competitive advantages and the ability to redeploy capital at high rates of return. We are optimistic about the long-term opportunities of our investments and continue to search for new ideas.

†

¹	Performance information reflects results of the Retail Shares.


Baron Partners Fund		December 31, 2016

STATEMENT OF NET ASSETS

DECEMBER 31, 2016


Shares			Cost		Value
Common Stocks (129.96%)
Consumer Discretionary (48.76%)
		Apparel, Accessories & Luxury Goods (3.95%)
	909,700	Under Armour, Inc., Cl A¹	$	33,032,266	$	26,426,785
	1,406,500	Under Armour, Inc., Cl C¹		36,183,561		35,401,605

				69,215,827		61,828,390


		Automobile Manufacturers (15.13%)
	1,110,000	Tesla Motors, Inc.¹		236,819,490		237,195,900

		Automotive Retail (1.54%)
	375,000	CarMax, Inc.¹		10,138,739		24,146,250

		Hotels, Resorts & Cruise Lines (10.46%)
	2,600,000	Hyatt Hotels Corp., Cl A¹		72,054,423		143,676,000
	475,000	Norwegian Cruise Line Holdings Ltd.^1,2		20,954,950		20,201,750

				93,009,373		163,877,750


		Internet & Direct Marketing Retail (2.90%)
	20,357,182	AO World plc (United Kingdom)^1,2		43,575,320		45,509,971

		Leisure Facilities (9.53%)
	925,800	Vail Resorts, Inc.		27,801,851		149,340,798

		Movies & Entertainment (4.86%)
	5,350,000	Manchester United plc, Cl A²		91,115,472		76,237,500

		Restaurants (0.39%)
	30,000	Panera Bread Co., Cl A¹		5,026,025		6,152,700

	Total Consumer Discretionary			576,702,097		764,289,259


Financials (31.10%)
		Asset Management & Custody Banks (2.81%)
	2,890,000	The Carlyle Group		72,986,195		44,072,500

		Financial Exchanges & Data (8.03%)
	770,000	FactSet Research Systems, Inc.		50,187,585		125,841,100

		Investment Banking & Brokerage (7.05%)
	2,800,000	The Charles Schwab Corp.		24,289,154		110,516,000

		Property & Casualty Insurance (13.21%)
	2,400,000	Arch Capital Group Ltd.^1,2		31,929,992		207,096,000

	Total Financials			179,392,926		487,525,600


Health Care (8.65%)
		Health Care Equipment (7.48%)
	1,000,000	IDEXX Laboratories, Inc.¹		43,593,540		117,270,000

		Health Care Technology (1.17%)
	1,776,790	Inovalon Holdings, Inc., CI A¹		47,548,581		18,300,937

	Total Health Care			91,142,121		135,570,937


Shares			Cost		Value
Common Stocks (continued)
Industrials (10.70%)
		Human Resource & Employment Services (2.49%)
	800,000	Robert Half International, Inc.	$	30,067,907	$	39,024,000

		Research & Consulting Services (3.62%)
	700,000	Verisk Analytics, Inc.¹		17,942,027		56,819,000

		Trading Companies & Distributors (4.59%)
	1,000,000	Air Lease Corp.		31,581,290		34,330,000
	800,000	Fastenal Co.		13,725,871		37,584,000

				45,307,161		71,914,000

	Total Industrials			93,317,095		167,757,000


Information Technology (23.93%)
		Internet Software & Services (19.80%)
	400,000	Benefitfocus, Inc.¹		14,575,230		11,880,000
	1,100,000	CoStar Group, Inc.¹		112,737,431		207,339,000
	2,500,000	Zillow Group, Inc., Cl A¹		60,868,348		91,125,000

				188,181,009		310,344,000

		IT Consulting & Other Services (4.13%)
	640,000	Gartner, Inc.¹		40,674,307		64,684,800

	Total Information Technology			228,855,316		375,028,800


Real Estate (6.82%)
		Hotel & Resort REITs (0.62%)
	382,727	MGM Growth Properties LLC, Cl A		8,037,267		9,686,820

		Office REITs (2.30%)
	985,000	Douglas Emmett, Inc.		28,695,526		36,011,600

		Specialized REITs (3.90%)
	2,000,000	Gaming and Leisure Properties, Inc.		61,345,351		61,240,000

	Total Real Estate			98,078,144		106,938,420

	Total Common Stocks			1,267,487,699		2,037,110,016


Private Equity Investments (0.22%)
Financials (0.22%)
		Asset Management & Custody Banks (0.22%)
	7,579,130	Windy City Investments Holdings, L.L.C.^1,3,4,6		0		3,456,083


16		See Notes to Financial Statements.


December 31, 2016		Baron Partners Fund

STATEMENT OF NET ASSETS (Continued)

DECEMBER 31, 2016

Principal Amount

Cost

Value

Short Term Investments (0.02%)

$274,928

Repurchase Agreement with Fixed Income Clearing Corp., dated 12/30/2016, 0.0305% due 1/3/2017; Proceeds at maturity - $274,928; (Fully collateralized by $305,000 U.S. Treasury Note,
1.625% due 5/15/2026; Market value - $283,855)⁵

274,928

Total Investments (130.20%)

1,267,762,627

2,040,841,027

Liabilities Less Cash and Other Assets (-30.20%)

(473,359,347

)

Net Assets

1,567,481,680

Retail Shares (Equivalent to $37.06 per share based
on 24,662,195 shares outstanding)

913,879,802

Institutional Shares (Equivalent to $37.70 per share based
on 17,115,523 shares outstanding)

645,338,910

R6 Shares (Equivalent to $37.71 per share based
on 219,147 shares outstanding)

8,262,968

%	Represents percentage of net assets.

¹	Non-income producing securities.

²	Foreign corporation.

³	At December 31, 2016, the market value of restricted and fair valued securities amounted to $3,456,083 or 0.22% of net assets. This security is not deemed liquid. See Note 6 regarding Restricted Securities.

⁴	The Adviser has reclassified/classified certain securities in or out of this sub-industry. Such reclassifications/classifications are not supported by S&P or MSCI.

⁵	Level 2 security. See Note 7 regarding Fair Value Measurements.

⁶	Level 3 security. See Note 7 regarding Fair Value Measurements.

All securities are Level 1, unless otherwise noted.


See Notes to Financial Statements.		17


Baron Focused Growth Fund		December 31, 2016

STATEMENT OF NET ASSETS

DECEMBER 31, 2016


Shares			Cost		Value
Common Stocks (90.80%)
Consumer Discretionary (46.07%)
		Automobile Manufacturers (10.98%)
	90,000	Tesla Motors, Inc.¹	$	20,342,221	$	19,232,100

		Hotels, Resorts & Cruise Lines (15.52%)
	150,000	Choice Hotels International, Inc.		5,080,139		8,407,500
	340,000	Hyatt Hotels Corp., Cl A¹		12,201,302		18,788,400

				17,281,441		27,195,900


		Internet & Direct Marketing Retail (2.55%)
	2,000,000	AO World plc (United Kingdom)^1,2		3,931,658		4,471,147

		Leisure Facilities (12.54%)
	136,230	Vail Resorts, Inc.		8,272,836		21,975,261

		Movies & Entertainment (4.48%)
	550,000	Manchester United plc, Cl A²		8,719,506		7,837,500

	Total Consumer Discretionary			58,547,662		80,711,908


Consumer Staples (2.52%)
		Household Products (2.52%)
	100,000	Church & Dwight Co., Inc.		1,274,171		4,419,000


Financials (19.38%)
		Asset Management & Custody Banks (7.46%)
	435,000	The Carlyle Group		9,519,389		6,633,750
	175,000	Financial Engines, Inc.		5,948,430		6,431,250

				15,467,819		13,065,000


		Financial Exchanges & Data (7.00%)
	75,000	FactSet Research Systems, Inc.		5,828,282		12,257,250

		Property & Casualty Insurance (4.92%)
	100,000	Arch Capital Group Ltd.^1,2		1,800,056		8,629,000

	Total Financials			23,096,157		33,951,250


Industrials (8.08%)
		Building Products (2.62%)
	160,000	CaesarStone Ltd.^1,2		6,770,357		4,584,000

		Research & Consulting Services (2.78%)
	60,000	Verisk Analytics, Inc.¹		1,688,861		4,870,200

		Trading Companies & Distributors (2.68%)
	100,000	Fastenal Co.		2,169,716		4,698,000

	Total Industrials			10,628,934		14,152,200

Shares

Cost

Value

Common Stocks (continued)

Information Technology (14.75%)

Application Software (2.87%)

101,870

Guidewire Software, Inc.¹

4,816,692

5,025,247

Internet Software & Services (11.88%)

225,000

Benefitfocus, Inc.¹

5,980,202

6,682,500

75,000

CoStar Group, Inc.¹

13,824,622

14,136,750

19,804,824

20,819,250

Total Information Technology

24,621,516

25,844,497

Total Common Stocks

118,168,440

159,078,855

Preferred Stocks (4.37%)

Telecommunication Services (4.37%)

Alternative Carriers (4.37%)

22,300

Iridium Communications, Inc.,
Series B, 6.75%³

5,814,082

7,664,733

Principal Amount

Short Term Investments (4.77%)

$8,350,534

Repurchase Agreement with Fixed Income Clearing Corp., dated 12/30/2016, 0.0305% due 1/3/2017; Proceeds at maturity - $8,350,562; (Fully collateralized by $8,430,000 U.S. Treasury Note, 0.375% due 7/15/2025; Market value - $8,521,533)³

8,350,534

Total Investments (99.94%)

132,333,056

175,094,122

Cash and Other Assets Less Liabilities (0.06%)

100,830

Net Assets

175,194,952

Retail Shares (Equivalent to $12.43 per share based on
3,031,041 shares outstanding)

37,688,342

Institutional Shares (Equivalent to $12.63 per share based on
10,208,792 shares outstanding)

128,926,883

R6 Shares (Equivalent to $12.63 per share based on
679,102 shares outstanding)

8,579,727

%	Represents percentage of net assets.

¹	Non-income producing securities.

²	Foreign corporation.

³	Level 2 security. See Note 7 regarding Fair Value Measurements.

All securities are Level 1, unless otherwise noted.


18		See Notes to Financial Statements.


December 31, 2016		Baron International Growth Fund

STATEMENT OF NET ASSETS

DECEMBER 31, 2016


Shares			Cost		Value
Common Stocks (90.16%)
Australia (4.54%)
	48,169	Domino’s Pizza Enterprises Ltd.	$	388,096	$	2,259,128
	345,000	MYOB Group Ltd.		951,083		911,228
	55,000	Newcrest Mining Ltd.		498,261		803,738

	Total Australia			1,837,440		3,974,094


Brazil (3.10%)
	250,000	BM&FBOVESPA SA²		827,205		1,264,861
	60,000	Smiles SA²		702,409		823,519
	85,000	TOTVS SA²		703,494		626,536

	Total Brazil			2,233,108		2,714,916


Canada (6.20%)
	15,000	Agnico Eagle Mines Ltd.		512,576		630,000
	5,200	Constellation Software, Inc.		662,016		2,362,957
	110,000	Encana Corp.		945,261		1,291,400
	35,000	Suncor Energy, Inc.		1,225,000		1,144,150

	Total Canada			3,344,853		5,428,507


Chile (1.05%)
	32,000	Sociedad Química y Minera de Chile SA, ADR		661,784		916,800


China (9.43%)
	20,000	Alibaba Group Holding Ltd., ADR¹		1,592,811		1,756,200
	3,500	Baidu, Inc., ADR¹		663,199		575,435
	76,000	BYD Co., Ltd., Cl H		471,093		400,361
	90,000	China Distance Education Holdings Ltd., ADR¹		996,684		1,006,200
	21,000	Ctrip.com International Ltd., ADR¹		756,010		840,000
	315,771	Haitong Securities Co., Ltd., Cl H		486,565		541,589
	2,001,700	Kingdee International Software Group Co. Ltd.¹		234,264		751,170
	8,000	TAL Education Group, ADR¹		250,373		561,200
	75,000	Tencent Holdings Ltd.		393,663		1,834,741

	Total China			5,844,662		8,266,896


Denmark (1.06%)
	53,000	Nets A/S, 144A¹		1,178,281		927,547


France (3.41%)
	7,000	Eurofins Scientific SE		682,393		2,984,264


Germany (6.62%)
	21,425	Fresenius Medical Care Ag & Co.		1,776,883		1,814,392
	23,566	ProSiebenSat.1 Media SE		953,083		908,175
	165,100	RIB Software AG		1,395,193		2,164,587
	15,000	Symrise AG		171,804		913,121

	Total Germany			4,296,963		5,800,275


Hong Kong (1.80%)
	275,000	L’Occitane International SA		580,547		519,892
	1,000,000	Man Wah Holdings Ltd.		588,953		677,026
	240,010	Wynn Macau Ltd.¹		290,539		381,936

	Total Hong Kong			1,460,039		1,578,854


Shares			Cost		Value
Common Stocks (continued)
India (2.46%)
	8,000	Maruti Suzuki India Ltd.	$	609,012	$	627,028
	55,000	Multi Commodity Exchange of India Ltd.		790,850		1,027,147
	75,000	Zee Entertainment Enterprises Ltd.		379,557		500,645

	Total India			1,779,419		2,154,820


Indonesia (1.97%)
	812,373	PT Matahari Department Store Tbk		1,014,213		912,017
	1,250,000	PT Sarana Menara Nusantara Tbk¹		260,297		332,158
	1,301,400	PT Tower Bersama Infrastructure Tbk		534,199		481,052

	Total Indonesia			1,808,709		1,725,227


Ireland (1.53%)
	16,075	Ryanair Holdings plc, ADR¹		399,042		1,338,405


Israel (4.09%)
	16,000	Check Point Software Technologies Ltd.¹		758,407		1,351,360
	27,000	Mellanox Technologies Ltd.¹		1,046,562		1,104,300
	18,000	Mobileye N.V.¹		652,001		686,160
	10,000	Wix.com Ltd.¹		439,285		445,500

	Total Israel			2,896,255		3,587,320


Japan (12.45%)
	25,000	Bridgestone Corp.		480,797		901,390
	200,000	Daiwa Securities Group, Inc.		1,367,627		1,232,599
	6,500	FANUC Corp.		593,652		1,102,011
	44,000	Mitsui Fudosan Co. Ltd.		908,371		1,018,353
	38,000	MonotaRO Co. Ltd.		466,100		777,070
	130,000	Rakuten, Inc.		1,636,392		1,274,139
	42,000	SMS Co. Ltd.		1,064,897		931,097
	38,000	SoftBank Group Corp.		1,682,304		2,524,663
	41,000	Sony Corp., ADR		1,308,191		1,149,230

	Total Japan			9,508,331		10,910,552


Mexico (1.12%)
	200,000	Grupo Financiero Banorte S.A.B. de C.V., Cl O		1,111,475		985,062


Netherlands (1.44%)
	5,000	Cimpress NV¹		475,629		458,050
	23,000	InterXion Holding N.V.¹		761,293		806,610

	Total Netherlands			1,236,922		1,264,660


Norway (1.31%)
	50,000	Golar LNG Ltd.		823,128		1,147,000


Panama (1.24%)
	12,000	Copa Holdings, S.A., Cl A		973,816		1,089,960


Russia (1.15%)
	50,000	Yandex N.V., Cl A¹		714,945		1,006,500


See Notes to Financial Statements.		19


Baron International Growth Fund		December 31, 2016

STATEMENT OF NET ASSETS (Continued)

DECEMBER 31, 2016


Shares			Cost		Value
Common Stocks (continued)
South Africa (0.95%)
	160,622	Steinhoff International Holdings N.V.	$	749,072	$	829,163


Spain (3.85%)
	12,000	Aena SA, 144A		1,098,173		1,637,713
	40,000	Grifols SA, ADR		207,626		642,800
	32,105	Industria de Diseño Textil SA		919,024		1,095,983

	Total Spain			2,224,823		3,376,496


Switzerland (2.13%)
	42,067	Julius Baer Group Ltd.		1,489,578		1,868,497


United Kingdom (12.63%)
	200,000	Abcam plc		1,362,532		1,890,501
	240,214	AO World plc¹		546,053		537,016
	225,000	Domino’s Pizza Group plc		675,667		1,000,462
	73,000	Experian plc		770,060		1,416,052
	300,000	Horizon Discovery Group plc¹		608,398		532,397
	110,000	Howden Joinery Group PLC		511,855		520,294
	30,000	Intertek Group plc		816,271		1,286,995
	70,159	JUST EAT plc¹		290,233		504,517
	1,501,886	Lekoil Ltd.¹		530,554		485,868
	22,325	Reckitt Benckiser Group PLC		2,145,569		1,894,568
	300,000	Worldpay Group plc, 144A		1,097,280		997,874

	Total United Kingdom			9,354,472		11,066,544


United States (4.63%)
	28,000	Agilent Technologies, Inc.		639,432		1,275,680
	27,000	Arch Capital Group Ltd.¹		983,682		2,329,830
	115,155	TerraForm Global, Inc., Cl A		904,503		454,862

	Total United States			2,527,617		4,060,372

	Total Common Stocks			59,137,127		79,002,731

Principal Amount

Cost

Value

Short Term Investments (9.57%)

$8,384,431

Repurchase Agreement with
Fixed Income Clearing Corp.,
dated 12/30/2016, 0.0305%
due 1/3/2017; Proceeds at
maturity - $8,384,459;
(Fully collateralized by
$8,465,000 U.S. Treasury Note,
0.375% due 7/15/2025
Market value - $8,556,913)²

8,384,431

Total Investments (99.73%)

67,521,558

87,387,162

Cash and Other Assets Less Liabilities (0.27%)

233,299

Net Assets

87,620,461

Retail Shares (Equivalent to $18.09 per share based on
2,314,654 shares outstanding)

41,862,236

Institutional Shares (Equivalent to $18.25 per share based on
2,486,436 shares outstanding)

45,384,682

R6 Shares (Equivalent to $18.25 per share based on
20,464 shares outstanding)

373,543

%	Represents percentage of net assets.

¹	Non-income producing securities.

²	Level 2 security. See Note 7 regarding Fair Value Measurements.

^ADR	American Depositary Receipt.

^144A

Security is exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. These securities have been deemed liquid pursuant to policies and procedures approved by the Board of Trustees, unless otherwise noted. At December 31, 2016, the market value of Rule 144A securities amounted to $3,563,134 or 4.07% of net assets.

All securities are Level 1, unless otherwise noted.


Summary of Investments by Sector as of December 31, 2016	Percentage of Net Assets

Information Technology		23.1	%

Consumer Discretionary		19.6	%

Financials		10.6	%

Industrials		10.5	%

Health Care		10.4	%

Energy		4.6	%

Telecommunication Services		3.8	%

Materials		3.7	%

Consumer Staples		2.2	%

Real Estate		1.2	%

Utilities		0.5	%

Cash and Cash Equivalents*		9.8	%
		100.0	%

*	Includes short term investments.


20		See Notes to Financial Statements.


December 31, 2016		Baron Real Estate Fund

STATEMENT OF NET ASSETS

DECEMBER 31, 2016


Shares			Cost		Value
Common Stocks (97.76%)
Consumer Discretionary (30.60%)
		Casinos & Gaming (6.27%)
	2,068,700	MGM Resorts International¹	$	41,142,891	$	59,640,621

		Home Furnishings (6.83%)
	325,307	Mohawk Industries, Inc.¹		46,064,799		64,957,302

		Home Improvement Retail (5.86%)
	301,700	Home Depot, Inc.		28,131,634		40,451,936
	214,000	Lowe’s Companies, Inc.		7,633,690		15,219,680

				35,765,324		55,671,616

		Homebuilding (1.53%)
	467,700	Toll Brothers, Inc.¹		14,454,925		14,498,700

		Hotels, Resorts & Cruise Lines (10.11%)
	1,615,900	Hilton Worldwide Holdings, Inc.		39,907,764		43,952,480
	223,650	Marriott International, Inc., Cl A		17,018,591		18,491,382
	507,350	Norwegian Cruise Line Holdings Ltd.^1,2		13,905,683		21,577,595
	147,500	Royal Caribbean Cruises Ltd.²		11,830,667		12,100,900

				82,662,705		96,122,357

	Total Consumer Discretionary			220,090,644		290,890,596


Financials (2.94%)
		Asset Management & Custody Banks (2.94%)
	845,300	Brookfield Asset Management, Inc., Cl A²		22,960,517		27,903,353


Industrials (9.12%)
		Building Products (4.26%)
	452,650	Masco Corp.		14,595,172		14,312,793
	397,800	Masonite International Corp.^1,2		23,211,673		26,175,240

				37,806,845		40,488,033

		Industrial Conglomerates (3.77%)
	438,600	Macquarie Infrastructure Corp.³		25,136,095		35,833,620

		Trading Companies & Distributors (1.09%)
	298,300	SiteOne Landscape Supply, Inc.¹		9,844,829		10,359,959

	Total Industrials			72,787,769		86,681,612


Information Technology (8.05%)
		Internet Software & Services (1.95%)
	98,250	CoStar Group, Inc. ¹		18,281,019		18,519,143

		IT Consulting & Other Services (6.10%)
	1,653,850	InterXion Holding N.V. ^1,2		49,917,131		58,000,519

	Total Information Technology			68,198,150		76,519,662


Shares			Cost		Value
Common Stocks (continued)
Materials (8.48%)
		Construction Materials (5.68%)
	115,600	Martin Marietta Materials, Inc.	$	15,219,152	$	25,608,868
	227,100	Vulcan Materials Co.		27,708,159		28,421,565

				42,927,311		54,030,433
		Specialty Chemicals (2.80%)
	98,850	The Sherwin-Williams Co.		25,953,131		26,564,949

	Total Materials			68,880,442		80,595,382


Real Estate (35.82%)
		Hotel & Resort REITs (2.09%)
	786,144	MGM Growth Properties LLC, Cl A		16,509,024		19,897,305

		Industrial REITs (3.63%)
	387,050	Prologis, Inc.		19,655,596		20,432,370
	606,300	Rexford Industrial Realty, Inc.		13,321,077		14,060,097

				32,976,673		34,492,467

		Office REITs (4.39%)
	58,500	Boston Properties, Inc.		7,333,010		7,358,130
	457,250	Douglas Emmett, Inc.		10,556,611		16,717,060
	168,900	Vornado Realty Trust		16,789,325		17,628,093

				34,678,946		41,703,283

		Real Estate Operating Companies (0.65%)
	302,750	Kennedy-Wilson Holdings, Inc.		4,149,206		6,206,375

		Real Estate Services (4.73%)
	1,149,950	CBRE Group, Inc., Cl A¹		25,374,283		36,211,925
	86,400	Jones Lang LaSalle, Inc.		7,310,848		8,729,856

				32,685,131		44,941,781

		Residential REITs (2.77%)
	529,839	American Campus Communities, Inc.		21,442,472		26,370,087

		Retail REITs (3.38%)
	336,750	General Growth Properties, Inc.		9,076,543		8,412,015
	133,350	Simon Property Group, Inc.		20,366,635		23,692,295

				29,443,178		32,104,310

		Specialized REITs (14.18%)
	196,950	Alexandria Real Estate Equities, Inc.³		13,455,583		21,887,053
	436,200	American Tower Corp.		38,923,694		46,097,616
	134,541	Equinix, Inc.		30,585,205		48,086,299
	612,200	Gaming and Leisure Properties, Inc.		16,770,155		18,745,564

				99,734,637		134,816,532

	Total Real Estate			271,619,267		340,532,140


Telecommunication Services (2.75%)
		Integrated Telecommunication Services (1.65%)
	151,800	SBA Communications Corp., Cl A¹		10,586,343		15,674,868

		Wireless Telecommunication Services (1.10%)
	39,421,610	PT Sarana Menara Nusantara Tbk. (Indonesia)^1,2		9,738,076		10,475,365

	Total Telecommunication Services			20,324,419		26,150,233

	Total Common Stocks			744,861,208		929,272,978


See Notes to Financial Statements.		21


Baron Real Estate Fund		December 31, 2016

STATEMENT OF NET ASSETS (Continued)

DECEMBER 31, 2016

Principal Amount

Cost

Value

Short Term Investments (2.61%)

$24,789,506

Repurchase Agreement with Fixed Income Clearing Corp., dated 12/30/2016, 0.0305% due 1/3/2017; Proceeds at maturity - $24,789,589; (Fully collateralized by $25,015,000 U.S. Treasury Note, 0.375% due 7/15/2025; Market value - $25,286,613)⁴

24,789,506

Total Investments (100.37%)

769,650,714

954,062,484

Liabilities Less Cash and Other Assets (-0.37%)

(3,495,760

)

Net Assets

950,566,724

Retail Shares (Equivalent to $23.67 per share based on
18,335,847 shares outstanding)

433,979,071

Institutional Shares (Equivalent to $23.93 per share based on
21,507,443 shares outstanding)

514,643,164

R6 Shares (Equivalent to $23.93 per share based on
81,265 shares outstanding)

1,944,489

%	Represents percentage of net assets.

¹	Non-income producing securities.

²	Foreign corporation.

³	The Adviser has reclassified/classified certain securities in or out of this sub-industry. Such reclassifications/classifications are not supported by S&P or MSCI.

⁴	Level 2 security. See Note 7 regarding Fair Value Measurements.

All securities are Level 1, unless otherwise noted.


22		See Notes to Financial Statements.


December 31, 2016		Baron Emerging Markets Fund

STATEMENT OF NET ASSETS

DECEMBER 31, 2016


Shares			Cost		Value
Common Stocks (92.36%)
Argentina (0.92%)
	1,450,000	YPF SA, ADR	$	26,671,589	$	23,925,000


Brazil (6.74%)
	7,500,000	BM&FBOVESPA SA³		27,831,433		37,945,817
	2,250,312	Cetip SA - Mercados Organizados³		25,828,094		30,807,593
	8,697,380	Kroton Educacional SA³		36,927,878		35,520,531
	1,325,000	Multiplus SA³		15,074,723		13,732,291
	2,650,000	Smiles SA³		36,301,500		36,372,104
	2,847,480	TOTVS SA³		35,217,229		20,988,806

	Total Brazil			177,180,857		175,367,142


Chile (1.95%)
	1,011,968	Banco Santander Chile, ADR		22,648,809		22,131,740
	1,000,000	Sociedad Química y Minera de Chile SA, ADR		21,616,350		28,650,000

	Total Chile			44,265,159		50,781,740


China (22.50%)
	1,050,000	Alibaba Group Holding Ltd., ADR¹		87,353,301		92,200,500
	200,000	Baidu, Inc., ADR ¹		37,246,112		32,882,000
	4,250,000	BYD Co., Ltd., Cl H		27,175,564		22,388,613
	7,000,000	China Everbright Ltd.		20,372,788		13,323,876
	18,500,000	China Mengniu Dairy Co. Ltd.		37,134,314		35,642,530
	3,500,000	China Mobile Ltd.		43,857,697		37,101,038
	875,850	Ctrip.com International Ltd., ADR¹		29,735,667		35,034,000
	19,000,400	Haitong Securities Co., Ltd., Cl H		30,499,119		32,588,216
	45,000,000	Kingdee International Software Group Co. Ltd.¹		14,212,410		16,886,969
	43,000,000	PetroChina Co. Ltd.		38,308,973		32,051,067
	4,900,000	Shenzhou International Group Holdings Ltd.		21,892,672		30,994,261
	85,033	Sina Corp.¹		5,816,194		5,169,156
	8,650,000	Sinopharm Group Co. Ltd., Cl H		33,389,526		35,639,629
	4,500,000	Sunny Optical Technology Group Co., Ltd.		10,400,223		19,701,464
	490,754	TAL Education Group, ADR¹		13,284,415		34,426,393
	2,400,000	Tencent Holdings Ltd.		43,136,502		58,711,716
	8,503	Weibo Corp., ADR¹		413,428		345,222
	41,086,494	WH Group Ltd., 144A		34,554,473		33,221,009
	20,009,500	Zhaojin Mining Industry Co. Ltd.		11,800,657		17,211,086

	Total China			540,584,035		585,518,745


Hong Kong (2.42%)
	35,000,000	Man Wah Holdings Ltd.		15,256,713		23,695,918
	6,495,409	Techtronic Industries Co. Ltd.		25,852,443		23,286,140
	10,000,995	Wynn Macau Ltd.¹		16,914,376		15,914,924

	Total Hong Kong			58,023,532		62,896,982


India (14.15%)
	2,000,000	Amara Raja Batteries Ltd.		16,897,443		25,646,088
	14,000,000	Bank of Baroda¹		31,468,000		31,642,847
	1,189,229	Bharat Financial Inclusion Limited¹		8,352,144		10,301,278
	7,750,000	Coal India Ltd.		43,072,753		34,256,667
	3,752,679	DEN Networks Ltd.¹		10,244,650		3,721,162
	5,034,985	Dish TV India Ltd.¹		4,269,609		6,279,821
	2,300,000	Divi’s Laboratories Ltd.		29,635,791		26,558,273
	10,500,000	Exide Industries Ltd.		28,280,902		27,862,826


Shares			Cost		Value
Common Stocks (continued)
India (continued)
	5,770,000	Hathway Cable and Datacom Ltd.¹	$	5,093,897	$	2,933,034
	2,850,000	Kotak Mahindra Bank Ltd.		32,559,914		30,221,674
	1,749,596	Manpasand Beverages Ltd.		17,799,139		14,227,229
	400,000	Maruti Suzuki India Ltd.		30,585,708		31,351,407
	4,650,000	Motherson Sumi Systems Ltd.		23,017,965		22,366,178
	1,025,000	Multi Commodity Exchange of India Ltd.		15,676,534		19,142,294
	1,500,000	PVR Ltd.		14,319,858		25,388,611
	3,250,000	Sun TV Network Ltd.		20,644,029		23,578,901
	650,000	Torrent Pharmaceuticals Ltd.		5,131,164		12,614,520
	3,000,000	Zee Entertainment Enterprises Ltd.		13,489,550		20,025,785

	Total India			350,539,050		368,118,595


Indonesia (3.64%)
	22,000,000	PT Bank Mandiri (Persero) Tbk		18,672,961		18,901,466
	55,000,000	PT Bank Negara Indonesia (Persero) Tbk		23,326,306		22,555,205
	26,000,327	PT Matahari Department Store Tbk		33,058,076		29,189,456
	27,631,350	PT Sarana Menara Nusantara Tbk.¹		8,841,958		7,342,382
	45,343,836	PT Tower Bersama Infrastructure Tbk		23,345,968		16,760,980

	Total Indonesia			107,245,269		94,749,489


Korea, Republic of (6.21%)
	221,541	KB Financial Group, Inc.³		8,222,119		7,829,137
	34,000	LG Household & Health Care Ltd.³		21,675,205		24,122,708
	65,000	NAVER Corporation³		38,953,531		41,624,523
	38,000	Samsung Electronics Co., Ltd.³		46,455,714		56,555,858
	250,000	Samsung Life Insurance Co. Ltd.³		24,724,971		23,268,838
	221,579	Shinhan Financial Group Co., Ltd.³		8,911,894		8,309,468

	Total Korea, Republic of			148,943,434		161,710,532


Mexico (5.60%)
	350,000	Fomento Económico Mexicano, S.A.B. de C.V., ADR		31,958,069		26,673,500
	1,950,300	GRUMA S.A.B. de C.V., Cl B		27,748,711		24,781,365
	6,500,000	Grupo Financiero Banorte S.A.B. de C.V., Cl O		35,196,778		32,014,530
	12,000,513	Grupo Lala S.A.B. de C.V.		23,659,634		17,454,007
	7,800,634	Infraestructura Energetica Nova S.A.B. de C.V.		36,302,963		33,980,181
	6,000,000	Wal-Mart de Mexico S.A.B de C.V.		13,222,319		10,738,242

	Total Mexico			168,088,474		145,641,825


Panama (1.75%)
	500,000	Copa Holdings, S.A., Cl A		31,251,656		45,415,000


Philippines (2.58%)
	35,005,000	Ayala Land, Inc.³		25,979,935		22,490,627
	11,500,000	BDO Unibank, Inc.³		25,523,320		25,914,554
	140,000,000	Metro Pacific Investments Corp.³		15,473,801		18,737,501

	Total Philippines			66,977,056		67,142,682


See Notes to Financial Statements.		23


Baron Emerging Markets Fund		December 31, 2016

STATEMENT OF NET ASSETS (Continued)

DECEMBER 31, 2016


Shares			Cost		Value
Common Stocks (continued)
Russia (4.64%)
	868,213	Magnit PJSC, GDR	$	35,336,430	$	38,331,604
	4,248,044	Sberbank of Russia, ADR		36,237,218		49,171,109
	1,650,000	Yandex N.V., Cl A¹		27,173,029		33,214,500

	Total Russia			98,746,677		120,717,213


Singapore (1.33%)
	22,737,518	Global Logistic Properties Ltd.		40,007,623		34,542,375


South Africa (6.63%)
	2,000,708	AngloGold Ashanti Ltd., ADR¹		24,350,042		21,027,441
	825,700	Aspen Pharmacare Holdings Ltd.		22,175,753		17,049,386
	1,275,138	Bid Corp. Ltd.		22,788,442		22,761,451
	2,200,138	Bidvest Group Ltd.		18,556,647		29,036,135
	8,855,817	Life Healthcare Group Holdings Ltd.		22,463,547		21,021,180
	575,000	Sasol Limited		18,826,022		16,701,010
	400,500	Sasol Limited, ADR		12,856,595		11,450,295
	6,500,764	Steinhoff International Holdings N.V.		31,999,155		33,558,229

	Total South Africa			174,016,203		172,605,127


Taiwan, Province of China (8.58%)
	6,710,879	Delta Electronics, Inc.		35,335,541		33,211,865
	1,849,231	Eclat Textile Co., Ltd.		21,992,723		19,365,027
	15,001,000	Far EasTone Telecommunications Co., Ltd.		33,277,525		33,745,152
	2,500,000	Ginko International Co., Ltd.		33,951,147		25,869,558
	1,997,513	Makalot Industrial Co. Ltd.		10,458,553		7,685,364
	1,006,578	MediaTek, Inc.		14,708,872		6,761,741
	5,000,000	Novatek Microelectronics Corp.		20,491,039		16,522,387
	8,800,000	Taiwan Mobile Co., Ltd.		30,026,544		28,396,786
	1,800,900	Taiwan Semiconductor Manufacturing Company Ltd., ADR		38,286,376		51,775,875

	Total Taiwan, Province of China			238,528,320		223,333,755


Thailand (0.71%)
	100,000	Bangkok Bank PCL, Cl F³		629,574		450,985
	4,026,000	Bangkok Bank Public Co., Ltd., NVDR		21,278,175		17,931,808

	Total Thailand			21,907,749		18,382,793


United Kingdom (1.48%)
	33,000,000	Lekoil Ltd.^1,2		14,922,322		10,675,663
	7,250,000	Tullow Oil plc¹		22,398,274		27,939,428

	Total United Kingdom			37,320,596		38,615,091


United States (0.53%)
	3,500,219	TerraForm Global, Inc., Cl A		32,345,911		13,825,865

	Total Common Stocks			2,362,643,190		2,403,289,951


Preferred Stocks (0.02%)
India (0.02%)
	3,098,340	Zee Entertainment Enterprises Ltd., 6.00% due 3/5/2022		367,971		446,924

Principal Amount

Cost

Value

Convertible Bonds (0.27%)

China (0.27%)

$50,000,000

Biostime International Holdings Ltd., 0.00% due 2/20/2019^1,3

6,590,207

6,995,938

Short Term Investments (7.16%)

186,251,623

Repurchase Agreement with
Fixed Income Clearing Corp.,
dated 12/30/2016, 0.0305%
due 1/3/2017; Proceeds at
maturity - $186,252,244;
(Fully collateralized by
$193,950,000 U.S. Treasury Note, 2.125% due 5/15/2025;
Market value - $189,976,740)³

186,251,623

Total Investments (99.81%)

2,555,852,991

2,596,984,436

Cash and Other Assets Less Liabilities (0.19%)

5,008,907

Net Assets

2,601,993,343

Retail Shares (Equivalent to $10.95 per share
based on 70,155,170 shares outstanding)

768,485,288

Institutional Shares (Equivalent to $10.98 per share
based on 166,920,511 shares outstanding)

1,832,814,841

R6 Shares (Equivalent to $10.99 per share
based on 63,091 shares outstanding)

693,214

%	Represents percentage of net assets.

¹	Non-income producing securities.

²	See Note 10 regarding “Affiliated” companies.

³	Level 2 security. See Note 7 regarding Fair Value Measurements.

ADR	American Depositary Receipt.

GDR	Global Depositary Receipt.

NVDR	Non-Voting Depositary Receipt.

144A

Security is exempt from registration pursuant to Rule 144A under the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. This security has been deemed liquid pursuant to policies and procedures approved by the Board of Trustees, unless otherwise noted. At December 31, 2016, the market value of Rule 144A securities amounted to $33,221,009 or 1.28% of net assets.

All securities are Level 1, unless otherwise noted.


Summary of Investments by Sector as of December 31, 2016	Percentage of Net Assets
Consumer Discretionary		20.2	%
Information Technology		18.7	%
Financials		17.4	%
Consumer Staples		9.8	%
Health Care		5.3	%
Energy		5.0	%
Telecommunication Services		4.7	%
Industrials		3.8	%
Materials		3.7	%
Real Estate		2.2	%
Utilities		1.8	%
Cash and Cash Equivalents*		7.4	%
		100.0	%

*	Includes short term investments.


24		See Notes to Financial Statements.


December 31, 2016		Baron Energy and Resources Fund

STATEMENT OF NET ASSETS

DECEMBER 31, 2016


Shares			Cost		Value
Common Stocks (99.43%)
Consumer Discretionary (2.90%)
		Automobile Manufacturers (2.90%)
	14,100	Tesla Motors, Inc.¹	$	3,242,965	$	3,013,029


Energy (85.70%)
		Oil & Gas Drilling (1.88%)
	119,300	Nabors Industries Ltd.²		1,373,758		1,956,520

		Oil & Gas Equipment & Services (14.58%)
	17,150	Core Laboratories N.V.²		2,024,011		2,058,686
	36,000	FMC Technologies, Inc.¹		1,030,621		1,279,080
	73,900	Forum Energy Technologies, Inc.¹		1,331,497		1,625,800
	75,496	Halliburton Co.		3,391,871		4,083,579
	36,800	Schlumberger Limited²		2,693,203		3,089,360
	53,200	U.S. Silica Holdings, Inc.		1,376,948		3,015,376

				11,848,151		15,151,881

		Oil & Gas Exploration & Production (47.49%)
	25,100	Anadarko Petroleum Corporation		1,478,327		1,750,223
	85,200	Antero Resources Corp.¹		2,429,491		2,014,980
	45,599	Concho Resources, Inc.¹		4,521,735		6,046,427
	524,700	Encana Corp.²		3,398,305		6,159,978
	27,666	Energen Corp.¹		1,231,781		1,595,498
	22,768	EOG Resources, Inc.		1,862,607		2,301,845
	333,800	Jones Energy, Inc., Cl A¹		1,591,258		1,669,000
	2,496,354	Lekoil Ltd. (United Kingdom)^1,2		1,228,382		807,583
	122,200	Newfield Exploration Co.¹		3,561,749		4,949,100
	29,549	Noble Energy, Inc.		922,418		1,124,635
	192,500	Parsley Energy, Inc., Cl A¹		3,211,888		6,783,700
	120,300	Rice Energy, Inc.¹		1,094,647		2,568,405
	161,800	RSP Permian, Inc.¹		3,928,743		7,219,516
	125,000	Sanchez Production Partners LP		1,375,000		1,462,500
	198,000	WPX Energy, Inc.¹		2,447,714		2,884,860

				34,284,045		49,338,250

		Oil & Gas Refining & Marketing (2.90%)
	44,100	Valero Energy Corporation		2,812,113		3,012,912

		Oil & Gas Storage & Transportation (18.85%)
	144,000	Energy Transfer Equity L.P.		1,014,500		2,780,640
	129,635	Golar LNG Ltd.²		2,858,007		2,973,827
	34,200	MPLX LP		1,063,167		1,184,004
	47,738	Noble Midstream Partners LP¹		1,074,105		1,718,568
	201,804	Scorpio Tankers, Inc.²		1,862,800		914,172
	52,000	SemGroup Corp., Cl A		1,610,536		2,171,000
	43,540	Tallgrass Energy Partners, LP		1,134,548		2,065,973
	62,600	Targa Resources Corp.		1,793,922		3,509,982
	51,200	Valero Energy Partners LP		2,144,610		2,266,624

				14,556,195		19,584,790

	Total Energy			64,874,262		89,044,353


Information Technology (2.52%)
		Application Software (2.52%)
	47,800	Aspen Technology, Inc.¹		1,862,658		2,613,704


Shares			Cost		Value
Common Stocks (continued)
Materials (5.90%)
		Commodity Chemicals (0.99%)
	47,332	Westlake Chemical Partners LP	$	1,146,768	$	1,027,105

		Specialty Chemicals (4.91%)
	377,852	Flotek Industries, Inc.¹		4,393,946		3,548,030
	54,700	Kraton Corporation¹		1,443,382		1,557,856

				5,837,328		5,105,886

	Total Materials			6,984,096		6,132,991


Utilities (2.41%)
		Gas Utilities (1.08%)
	256,166	Infraestructura Energetica Nova S.A.B. de C.V. (Mexico)²		1,079,252		1,115,879

		Renewable Electricity (1.33%)
	218,126	TerraForm Global, Inc., Cl A		2,967,630		861,598
	40,910	TerraForm Power, Inc., Cl A¹		736,033		524,057

				3,703,663		1,385,655

	Total Utilities			4,782,915		2,501,534

	Total Common Stocks			81,746,896		103,305,611


Principal Amount
Short Term Investments (0.46%)
	$482,492	Repurchase Agreement with Fixed Income Clearing Corp., dated 12/30/2016, 0.0305% due 1/3/2017; Proceeds at maturity - $482,494; (Fully collateralized by $530,000 U.S. Treasury Note, 1.625% due 2/15/2026; Market value - $496,391)³		482,492		482,492

	Total Investments (99.89%)		$	82,229,388		103,788,103

	Cash and Other Assets Less Liabilities (0.11%)					110,084

	Net Assets				$	103,898,187

	Retail Shares (Equivalent to $9.00 per share based on 8,088,125 shares outstanding)				$	72,782,135

	Institutional Shares (Equivalent to $9.11 per share based on 3,372,300 shares outstanding)				$	30,724,449

	R6 Shares (Equivalent to $9.10 per share based on 43,017 shares outstanding)				$	391,603

%	Represents percentage of net assets.

¹	Non-income producing securities.

²	Foreign corporation.

³	Level 2 security. See Note 7 regarding Fair Value Measurements.

All securities are Level 1, unless otherwise noted.


See Notes to Financial Statements.		25


Baron Global Advantage Fund		December 31, 2016

STATEMENT OF NET ASSETS

DECEMBER 31, 2016


Shares			Cost		Value
Common Stocks (99.26%)
Argentina (1.30%)
	3,786	Globant SA¹	$	150,993	$	126,263


Brazil (3.31%)
	23,517	Cetip SA - Mercados Organizados ²		244,353		321,956


Canada (5.18%)
	1,107	Constellation Software, Inc.		338,745		503,037


China (15.92%)
	6,482	Alibaba Group Holding Ltd., ADR¹		541,292		569,184
	679	Baidu, Inc., ADR¹		88,840		111,634
	9,508	Ctrip.com International Ltd., ADR¹		319,515		380,320
	6,923	TAL Education Group, ADR¹		198,990		485,649

	Total China			1,148,637		1,546,787


Israel (7.66%)
	1,217	Check Point Software Technologies Ltd.¹		81,662		102,788
	9,491	Mellanox Technologies Ltd.¹		386,503		388,182
	6,640	Mobileye N.V.¹		323,741		253,117

	Total Israel			791,906		744,087


Japan (1.65%)
	26,000	Daiwa Securities Group, Inc.		167,827		160,238


Netherlands (1.78%)
	1,544	ASML Holding N.V.		111,558		173,337


South Africa (4.82%)
	3,193	Naspers Limited, Cl N		445,555		468,262


United Kingdom (4.44%)
	59,967	JUST EAT plc¹		258,537		431,226


United States (53.20%)
	9,405	Acxiom Corp.¹		185,152		252,054
	3,726	Aerie Pharmaceuticals, Inc.¹		61,817		141,029
	933	Allergan plc		256,633		195,939
	696	Alphabet Inc., Cl C¹		358,241		537,187
	1,553	Amazon.com, Inc.¹		475,611		1,164,548
	291	Bats Global Markets, Inc.		5,529		9,751
	4,399	Benefitfocus, Inc.¹		117,819		130,650
	6,818	BlackLine, Inc.¹		115,906		188,381
	4,888	EPAM Systems, Inc.¹		352,033		314,347
	4,592	Facebook, Inc., Cl A¹		123,378		528,310
	18,036	FireEye, Inc.¹		556,784		214,628
	2,533	First Republic Bank		182,384		233,391
	6,725	Glaukos Corporation¹		150,392		230,668
	4,529	Greenlight Capital Re Ltd., Cl A¹		99,623		103,261


Shares			Cost		Value
Common Stocks (continued)
United States (continued)
	1,889	Illumina, Inc.¹	$	109,775	$	241,868
	1,361	Luxoft Holding, Inc.¹		81,588		76,488
	4,129	Noble Midstream Partners LP¹		92,903		148,644
	5,255	Pacira Pharmaceuticals, Inc.¹		336,531		169,737
	149	The Priceline Group, Inc.¹		109,221		218,443
	1,377	Splunk, Inc.¹		82,149		70,434

	Total United States			3,853,469		5,169,758

	Total Common Stocks			7,511,580		9,644,951


Principal Amount
Short Term Investments (1.50%)
	$146,072	Repurchase Agreement with Fixed Income Clearing Corp., dated 12/30/2016, 0.0305% due 1/3/2017; Proceeds at maturity - $146,073; (Fully collateralized by $160,000 U.S. Treasury Note, 1.625% due 2/15/2026; Market value - $149,854)²		146,072		146,072

	Total Investments (100.76%)		$	7,657,652		9,791,023

	Liabilities Less Cash and Other Assets (-0.76%)					(73,908	)

	Net Assets				$	9,717,115

	Retail Shares (Equivalent to $13.75 per share based on 361,216 shares outstanding)				$	4,966,496

	Institutional Shares (Equivalent to $13.87 per share based on 330,862 shares outstanding)				$	4,589,126

	R6 Shares (Equivalent to $13.87 per share based on 11,643 shares outstanding)				$	161,493

%	Represents percentage of net assets.

¹	Non-income producing securities.

²	Level 2 Security. See Note 7 regarding Fair Value Measurements.

^ADR	American Depositary Receipt.

All securities are Level 1, unless otherwise noted.


Summary of Investments by Sector as of December 31, 2016	Percentage of Net Assets

Information Technology		51.2	%

Consumer Discretionary		28.0	%

Health Care		10.1	%

Financials		8.5	%

Energy		1.5	%

Cash and Cash Equivalents*		0.7	%
		100.0	%

*	Includes short term investments.


26		See Notes to Financial Statements.


December 31, 2016		Baron Select Funds

STATEMENTS OF ASSETS AND LIABILITIES

DECEMBER 31, 2016


	Baron Partners Fund			Baron Focused Growth Fund			Baron International Growth Fund			Baron Real Estate Fund
Assets:
Investments in securities, at value*
Unaffiliated investments	$	2,040,841,027		$	175,094,122		$	87,387,162		$	954,062,484
“Affiliated” investments		—			—			—			—

Total investments, at value	$	2,040,841,027		$	175,094,122		$	87,387,162		$	954,062,484

Foreign currency, at value†		—			—			2,565			—
Receivable for shares sold		2,181,828			622			302,812			856,745
Dividends and interest receivable		1,781,467			204,360			99,481			1,394,150
Receivable for securities sold		—			—			—			890,145
Prepaid expenses		275,014			331			182			2,915
Other assets		—			—			9,083			—

		2,045,079,336			175,299,435			87,801,285			957,206,439

Liabilities:
Payable for borrowings against line of credit		475,000,000			—			—			—
Payable for shares redeemed		1,735,481			41,784			65,080			6,480,225
Distribution fees payable (Note 4)		85			407			762			579
Investment advisory fees payable (Note 4)		77			368			316			232
Accrued capital gains taxes		—			—			43,843			—
Accrued expenses and other payables		862,013			61,924			70,823			158,679

		477,597,656			104,483			180,824			6,639,715

Net Assets	$	1,567,481,680		$	175,194,952		$	87,620,461		$	950,566,724

Net Assets consist of:
Paid-in capital	$	969,532,485		$	131,584,275		$	67,648,367		$	799,431,193
Undistributed (accumulated) net investment income (loss)		15,124,025			1,480,259			(20,705	)		(330	)
Undistributed (accumulated) net realized gain (loss) on investments and foreign currency transactions		(190,253,230	)		(630,648	)		172,264			(33,275,842	)
Net unrealized appreciation on investments, foreign capital gains tax and foreign currency translations		773,078,400			42,761,066			19,820,535			184,411,703

Net Assets	$	1,567,481,680		$	175,194,952		$	87,620,461		$	950,566,724

Retail Shares:
Net Assets	$	913,879,802		$	37,688,342		$	41,862,236		$	433,979,071
Shares Outstanding ($0.01 par value; indefinite shares authorized)		24,662,195			3,031,041			2,314,654			18,335,847

Net Asset Value and Offering Price Per Share	$	37.06		$	12.43		$	18.09		$	23.67

Institutional Shares:
Net Assets	$	645,338,910		$	128,926,883		$	45,384,682		$	514,643,164
Shares Outstanding ($0.01 par value; indefinite shares authorized)		17,115,523			10,208,792			2,486,436			21,507,443

Net Asset Value and Offering Price Per Share	$	37.70		$	12.63		$	18.25		$	23.93

R6 Shares:
Net Assets	$	8,262,968		$	8,579,727		$	373,543		$	1,944,489
Shares Outstanding ($0.01 par value; indefinite shares authorized)		219,147			679,102			20,464			81,265

Net Asset Value and Offering Price Per Share	$	37.71		$	12.63		$	18.25		$	23.93


*Investments in securities, at cost
Unaffiliated investments	$	1,267,762,627		$	132,333,056		$	67,521,558		$	769,650,714
“Affiliated” investments		—			—			—			—

Total investments, at cost	$	1,267,762,627		$	132,333,056		$	67,521,558		$	769,650,714


†Foreign currency, at cost:	$	—		$	—		$	2,554		$	—


See Notes to Financial Statements.		27


Baron Select Funds		December 31, 2016

STATEMENTS OF ASSETS AND LIABILITIES (Continued)

DECEMBER 31, 2016


	Baron Emerging Markets Fund			Baron Energy and Resources Fund			Baron Global Advantage Fund
Assets:
Investments in securities, at value*
Unaffiliated investments	$	2,586,308,773		$	103,788,103		$	9,791,023
“Affiliated” investments		10,675,663			—			—

Total investments, at value	$	2,596,984,436		$	103,788,103		$	9,791,023

Foreign currency, at value†		48,621			—			14
Receivable for shares sold		9,107,244			332,247			163
Dividends and interest receivable		3,201,441			39,733			4,709
Receivable for securities sold		1,496,104			—			—
Prepaid expenses		3,082			114			11
Other assets		—			—			—

		2,610,840,928			104,160,197			9,795,920

Liabilities:
Payable for borrowings against line of credit		—			—			—
Payable for shares redeemed		8,434,799			148,480			—
Distribution fees payable (Note 4)		478			250			357
Investment advisory fees payable (Note 4)		807			412			—
Accrued capital gains taxes		—			—			—
Accrued expenses and other payables		411,501			112,868			78,448

		8,847,585			262,010			78,805

Net Assets	$	2,601,993,343		$	103,898,187		$	9,717,115

Net Assets consist of:
Paid-in capital	$	2,757,038,438		$	115,181,323		$	8,465,253
Undistributed (accumulated) net investment income (loss)		447,853			905,895			(2,104	)
Accumulated net realized loss on investments and foreign currency transactions		(196,645,904	)		(33,747,746	)		(879,391	)
Net unrealized appreciation on investments, foreign capital gains tax and foreign currency translations		41,152,956			21,558,715			2,133,357

Net Assets	$	2,601,993,343		$	103,898,187		$	9,717,115

Retail Shares:
Net Assets	$	768,485,288		$	72,782,135		$	4,966,496
Shares Outstanding ($0.01 par value; indefinite shares authorized)		70,155,170			8,088,125			361,216

Net Asset Value and Offering Price Per Share	$	10.95		$	9.00		$	13.75

Institutional Shares:
Net Assets	$	1,832,814,841		$	30,724,449		$	4,589,126
Shares Outstanding ($0.01 par value; indefinite shares authorized)		166,920,511			3,372,300			330,862

Net Asset Value and Offering Price Per Share	$	10.98		$	9.11		$	13.87

R6 Shares:
Net Assets	$	693,214		$	391,603		$	161,493
Shares Outstanding ($0.01 par value; indefinite shares authorized)		63,091			43,017			11,643

Net Asset Value and Offering Price Per Share	$	10.99		$	9.10		$	13.87


*Investments in securities, at cost
Unaffiliated investments	$	2,540,930,669		$	82,229,388		$	7,657,652
“Affiliated” investments		14,922,322			—			—

Total investments, at cost	$	2,555,852,991		$	82,229,388		$	7,657,652


†Foreign currency, at cost:	$	48,514		$	—		$	15


28		See Notes to Financial Statements.


December 31, 2016		Baron Select Funds

STATEMENTS OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 31, 2016


	Baron Partners Fund			Baron Focused Growth Fund			Baron International Growth Fund			Baron Real Estate Fund
Investment income:
Income:
Dividends — Unaffiliated investments	$	18,477,509		$	2,147,854		$	1,255,504		$	16,038,470
Interest		78			2,648			1,414			10,487
Securities lending income, net		5,406,325			427,248			—			—
Foreign taxes withheld on dividends		—			—			(114,109	)		(183,791	)

Total income		23,883,912			2,577,750			1,142,809			15,865,166

Expenses:
Investment advisory fees (Note 4)		16,292,295			1,750,565			858,800			12,582,370
Distribution fees — Retail Shares (Note 4)		2,396,797			99,737			101,690			1,411,908
Shareholder servicing agent fees and expenses — Retail Shares		210,049			25,686			26,909			93,799
Shareholder servicing agent fees and expenses — Institutional Shares		56,619			14,196			12,170			65,735
Shareholder servicing agent fees and expenses — R6 Shares		100			103			5			45
Line of credit fees		470,456			2,361			1,124			16,197
Reports to shareholders		384,050			11,005			51,540			330,670
Professional fees		185,890			61,632			63,698			89,331
Registration and filing fees		93,620			56,440			56,360			112,980
Custodian and fund accounting fees		79,068			28,703			77,252			98,334
Trustee fees and expenses		67,551			7,243			3,608			54,693
Administration fees		31,538			31,486			31,492			31,524
Insurance expense		26,979			2,710			1,504			24,739
Miscellaneous expenses		2,653			1,581			1,806			1,969

Total operating expenses		20,297,665			2,093,448			1,287,958			14,914,294
Interest expense on borrowings		6,948,906			—			—			—

Total expenses		27,246,571			2,093,448			1,287,958			14,914,294
Reimbursement of expenses by Adviser — Retail Shares (Note 4)		—			(31,864	)		(61,446	)		—
Reimbursement of expenses by Adviser — Institutional Shares (Note 4)		—			(35,335	)		(50,963	)		—
Reimbursement of expenses by Adviser — R6 Shares (Note 4)		—			(891	)		(145	)		—

Net expenses		27,246,571			2,025,358			1,175,404			14,914,294

Net investment income (loss)		(3,362,659	)		552,392			(32,595	)		950,872

Realized and unrealized gain (loss) on investments:
Net realized gain (loss) on investments sold		131,829,048			2,836,755			1,147,320	¹		(30,212,124	)
Net realized gain (loss) on foreign currency transactions		—			6,745			(41,615	)		(105,728	)
Change in net unrealized appreciation (depreciation) of:
Investments — Unaffiliated investments		(89,615,947	)		(2,305,485	)		(482,687	)²		(35,285,604	)
Investments — “Affiliated” investments		—			—			—			—
Foreign currency translations		—			—			1,020			3,877

Net gain (loss) on investments		42,213,101			538,015			624,038			(65,599,579	)

Net increase (decrease) in net assets resulting from operations	$	38,850,442		$	1,090,407		$	591,443		$	(64,648,707	)

¹	Net of realized foreign capital gains tax of $(23,961).

²	Net change in accrued foreign capital gains tax of $(26,282).


See Notes to Financial Statements.		29


Baron Select Funds		December 31, 2016

STATEMENTS OF OPERATIONS (Continued)

FOR THE YEAR ENDED DECEMBER 31, 2016


	Baron Emerging Markets Fund			Baron Energy and Resources Fund			Baron Global Advantage Fund
Investment income:
Income:
Dividends — Unaffiliated investments	$	39,759,904		$	1,529,238		$	21,786
Interest		59,937			1,501			46
Securities lending income, net		—			68,362			—
Foreign taxes withheld on dividends		(3,865,367	)		(11,243	)		(2,118	)

Total income		35,954,474			1,587,858			19,714

Expenses:
Investment advisory fees (Note 4)		21,103,684			967,798			103,495
Distribution fees — Retail Shares (Note 4)		1,712,064			169,783			13,670
Shareholder servicing agent fees and expenses — Retail Shares		82,465			28,845			15,079
Shareholder servicing agent fees and expenses — Institutional Shares		81,380			13,424			9,896
Shareholder servicing agent fees and expenses — R6 Shares		13			4			2
Line of credit fees		30,066			1,214			137
Reports to shareholders		545,920			95,890			8,292
Professional fees		135,315			172,003			117,221
Registration and filing fees		246,280			59,313			49,350
Custodian and fund accounting fees		1,416,590			32,027			33,514
Trustee fees and expenses		83,530			3,812			431
Administration fees		31,511			31,492			31,511
Insurance expense		25,639			1,303			174
Miscellaneous expenses		2,235			1,582			1,575

Total operating expenses		25,496,692			1,578,490			384,347
Interest expense on borrowings		—			852			—

Total expenses		25,496,692			1,579,342			384,347
Reimbursement of expenses by Adviser — Retail Shares (Note 4)		—			(240,471	)		(128,960	)
Reimbursement of expenses by Adviser — Institutional Shares (Note 4)		—			(103,207	)		(111,029	)
Reimbursement of expenses by Adviser — R6 Shares (Note 4)		—			(461	)		(1,324	)

Net expenses		25,496,692			1,235,203			143,034

Net investment income (loss)		10,457,782			352,655			(123,320	)

Realized and unrealized gain (loss) on investments:
Net realized loss on investments sold		(78,360,942	)		(3,970,885	)		(281,712	)
Net realized loss on foreign currency transactions		(1,532,442	)		(5,321	)		(1,076	)
Change in net unrealized appreciation of:
Investments — Unaffiliated investments		108,145,583	¹		30,124,552			257,504
Investments — “Affiliated” investments		1,958,993			—			—
Foreign currency translations		37,480			2			208

Net gain (loss) on investments		30,248,672			26,148,348			(25,076	)

Net increase (decrease) in net assets resulting from operations	$	40,706,454		$	26,501,003		$	(148,396	)

¹	Net change in accrued foreign capital gains tax of $1,325,466.


30		See Notes to Financial Statements.


December 31, 2016		Baron Select Funds

STATEMENTS OF CHANGES IN NET ASSETS


	Baron Partners Fund						Baron Focused Growth Fund						Baron International Growth Fund
	For the Year Ended December 31, 2016			For the Year Ended December 31, 2015			For the Year Ended December 31, 2016			For the Year Ended December 31, 2015			For the Year Ended December 31, 2016			For the Year Ended December 31, 2015
Increase (Decrease) in Net Assets:
Operations:
Net investment income (loss)	$	(3,362,659	)	$	(747,224	)	$	552,392		$	192,228		$	(32,595	)	$	298,094
Net realized gain (loss)		131,829,048			14,265,041			2,843,500			10,479,808			1,105,705			(32,526	)
Change in net unrealized appreciation (depreciation)		(89,615,947	)		(70,618,314	)		(2,305,485	)		(14,726,304	)		(481,667	)		1,343,071

Increase (decrease) in net assets resulting from operations		38,850,442			(57,100,497	)		1,090,407			(4,054,268	)		591,443			1,608,639

Distributions to shareholders from:
Net investment income — Retail Shares		—			(4,106,150	)		—			(70,067	)		(21,114	)		(210,570	)
Net investment income — Institutional Shares		—			(4,764,671	)		—			(580,716	)		(22,950	)		(462,862	)
Net investment income — R6 Shares		—			—			—			—			(203	)		—
Net realized gain on investments — Retail Shares		—			—			(2,213,476	)		(2,417,214	)		(331,053	)		(73,424	)
Net realized gain on investments — Institutional Shares		—			—			(7,303,770	)		(7,473,888	)		(368,392	)		(82,646	)
Net realized gain on investments — R6 Shares		—			—			(484,563	)		—			(3,222	)		—

Decrease in net assets from distributions to shareholders		—			(8,870,821	)		(10,001,809	)		(10,541,885	)		(746,934	)		(829,502	)

Capital share transactions:
Proceeds from the sale of shares — Retail Shares		66,762,551			164,387,862			2,156,926			6,397,130			9,413,535			8,899,357
Proceeds from the sale of shares — Institutional Shares		98,391,933			347,495,282			1,275,722			3,624,246			8,743,582			7,680,292
Proceeds from the sale of shares — R6 Shares		8,494,133			—			8,822,255			—			401,056			—
Net asset value of shares issued in reinvestment of distributions — Retail Shares		—			3,995,569			2,157,939			2,452,076			349,834			282,158
Net asset value of shares issued in reinvestment of distributions — Institutional Shares		—			4,177,881			6,065,578			6,671,379			366,821			341,079
Net asset value of shares issues in reinvestment of distribution — R6 Shares		—			—			484,563			—			3,425			—
Cost of shares redeemed — Retail Shares		(282,334,947	)		(278,717,168	)		(8,369,443	)		(7,449,535	)		(12,745,012	)		(17,823,270	)
Cost of shares redeemed — Institutional Shares		(263,475,486	)		(212,397,508	)		(12,670,110	)		(8,182,326	)		(17,355,234	)		(6,817,506	)
Cost of shares redeemed — R6 Shares		—			—			—			—			—			—

Increase (decrease) in net assets derived from capital share transactions		(372,161,816	)		28,941,918			(76,570	)		3,512,970			(10,821,993	)		(7,437,890	)

Net decrease in net assets		(333,311,374	)		(37,029,400	)		(8,987,972	)		(11,083,183	)		(10,977,484	)		(6,658,753	)

Net Assets:
Beginning of year		1,900,793,054			1,937,822,454			184,182,924			195,266,107			98,597,945			105,256,698

End of year	$	1,567,481,680		$	1,900,793,054		$	175,194,952		$	184,182,924		$	87,620,461		$	98,597,945

Undistributed (accumulated) net investment income (loss) at end of year	$	15,124,025		$	11,008,549		$	1,480,259		$	899,855		$	(20,705	)	$	(373,371	)

Capital share transactions — Retail Shares
Shares sold		1,972,887			4,413,521			170,798			442,457			521,310			479,118
Shares issued in reinvestment of distributions		—			113,189			171,805			189,066			19,035			15,603
Shares redeemed		(8,401,986	)		(7,633,879	)		(653,901	)		(530,825	)		(712,145	)		(958,724	)

Net increase (decrease)		(6,429,099	)		(3,107,169	)		(311,298	)		100,698			(171,800	)		(464,003	)

Capital share transactions — Institutional Shares
Shares sold		2,815,566			9,273,217			100,207			258,675			487,086			406,160
Shares issued in reinvestment of distributions		—			116,701			475,762			508,487			19,778			18,782
Shares redeemed		(7,646,600	)		(5,723,538	)		(968,806	)		(547,515	)		(976,763	)		(360,893	)

Net increase (decrease)		(4,831,034	)		3,666,380			(392,837	)		219,647			(469,899	)		64,049

Capital share transactions — R6 Shares
Shares sold		219,147			—			641,124			—			20,279			—
Shares issued in reinvestment of dividends		—			—			37,978			—			185			—
Shares redeemed		—			—			—			—			—			—

Net increase		219,147			—			679,102			—			20,464			—


See Notes to Financial Statements.		31


Baron Select Funds		December 31, 2016

STATEMENTS OF CHANGES IN NET ASSETS (Continued)


	Baron Real Estate Fund						Baron Emerging Markets Fund
	For the Year Ended December 31, 2016			For the Year Ended December 31, 2015			For the Year Ended December 31, 2016			For the Year Ended December 31, 2015
Increase (Decrease) in Net Assets:
Operations:
Net investment income (loss)	$	950,872		$	(1,503,894	)	$	10,457,782		$	6,124,993
Net realized gain (loss)		(30,317,852	)		35,068,425			(79,893,384	)		(86,230,454	)
Change in net unrealized appreciation (depreciation)		(35,281,727	)		(127,358,795	)		110,142,056			(116,515,878	)

Increase (decrease) in net assets resulting from operations		(64,648,707	)		(93,794,264	)		40,706,454			(196,621,339	)

Distributions to shareholders from:
Net investment income — Retail Shares		—			(364,929	)		(1,159,347	)		(701,411	)
Net investment income — Institutional Shares		—			(444,647	)		(6,815,620	)		(3,988,520	)
Net investment income — R6 Shares		—			—			(2,533	)		—
Net realized gain on investments — Retail Shares		(1,731,824	)		(15,405,999	)		—			—
Net realized gain on investments — Institutional Shares		(2,018,145	)		(19,283,111	)		—			—
Net realized gain on investments — R6 Shares		(6,592	)		—			—			—
Return of capital — Institutional Shares		(1,494,968	)		—			—			—
Return of capital — R6 Shares		(5,641	)		—			—			—

Decrease in net assets from distributions to shareholders		(5,257,170	)		(35,498,686	)		(7,977,500	)		(4,689,931	)

Capital share transactions:
Proceeds from the sale of shares — Retail Shares		76,821,436			336,220,314			363,774,905			426,130,100
Proceeds from the sale of shares — Institutional Shares		164,942,852			432,171,142			1,192,172,548			903,660,409
Proceeds from the sale of shares — R6 Shares		1,937,472			—			708,857			—
Net asset value of shares issued in reinvestment of distributions — Retail Shares		1,696,071			15,440,297			1,151,074			693,798
Net asset value of shares issued in reinvestment of distributions — Institutional Shares		2,978,927			16,601,383			5,212,419			3,084,734
Net asset value of shares issues in reinvestment of distribution — R6 Shares		12,233			—			2,533			—
Cost of shares redeemed — Retail Shares		(402,206,544	)		(285,156,542	)		(275,026,597	)		(320,271,070	)
Cost of shares redeemed — Institutional Shares		(607,362,368	)		(306,822,077	)		(425,085,374	)		(453,120,022	)
Cost of shares redeemed — R6 Shares		(29,272	)		—			(2,407	)		—

Increase (decrease) in net assets derived from capital share transactions		(761,209,193	)		208,454,517			862,907,958			560,177,949

Net increase (decrease) in net assets		(831,115,070	)		79,161,567			895,636,912			358,866,679

Net Assets:
Beginning of year		1,781,681,794			1,702,520,227			1,706,356,431			1,347,489,752

End of year	$	950,566,724		$	1,781,681,794		$	2,601,993,343		$	1,706,356,431

Undistributed (accumulated) net investment income (loss) at end of year	$	(330	)	$	(1,815,613	)	$	447,853		$	(500,002	)

Capital share transactions — Retail Shares
Shares sold		3,393,127			12,836,525			32,884,314			37,014,347
Shares issued in reinvestment of distributions		72,824			628,995			102,991			64,902
Shares redeemed		(17,670,830	)		(11,123,366	)		(25,792,716	)		(28,651,234	)

Net increase (decrease)		(14,204,879	)		2,342,154			7,194,589			8,428,015

Capital share transactions — Institutional Shares
Shares sold		7,257,564			16,521,289			107,399,121			80,184,256
Shares issued in reinvestment of distributions		126,180			668,952			467,660			288,024
Shares redeemed		(26,373,695	)		(11,879,810	)		(39,207,405	)		(40,651,773	)

Net increase (decrease)		(18,989,951	)		5,310,431			68,659,376			39,820,507

Capital share transactions — R6 Shares
Shares sold		81,973			—			63,070			—
Shares issued in reinvestment of dividends		518			—			227			—
Shares redeemed		(1,226	)		—			(206	)		—

Net increase		81,265			—			63,091			—


32		See Notes to Financial Statements.


December 31, 2016		Baron Select Funds

STATEMENTS OF CHANGES IN NET ASSETS (Continued)


	Baron Energy and Resources Fund						Baron Global Advantage Fund
	For the Year Ended December 31, 2016			For the Year Ended December 31, 2015			For the Year Ended December 31, 2016			For the Year Ended December 31, 2015
Increase (Decrease) in Net Assets:
Operations:
Net investment income (loss)	$	352,655		$	300,389		$	(123,320	)	$	(59,468	)
Net realized gain (loss)		(3,976,206	)		(30,798,728	)		(282,788	)		(671,076	)
Change in net unrealized appreciation (depreciation)		30,124,554			10,358			257,712			434,079

Increase (decrease) in net assets resulting from operations		26,501,003			(30,487,981	)		(148,396	)		(296,465	)

Distributions to shareholders from:
Net investment income — Retail Shares		—			—			—			(11,564	)
Net investment income — Institutional Shares		—			—			—			(16,685	)
Net investment income — R6 Shares		—			—			—			—
Net realized gain on investments — Retail Shares		—			(34,058	)		—			(7,375	)
Net realized gain on investments — Institutional Shares		—			(30,966	)		—			(6,436	)
Net realized gain on investments — R6 Shares		—			—			—			—

Decrease in net assets from distributions to shareholders		—			(65,024	)		—			(42,060	)

Capital share transactions:
Proceeds from the sale of shares — Retail Shares		22,973,711			50,753,381			665,553			3,922,722
Proceeds from the sale of shares — Institutional Shares		10,075,124			28,394,513			313,072			2,152,705
Proceeds from the sale of shares — R6 Shares		368,547			—			182,431			—
Net asset value of shares issued in reinvestment of distributions — Retail Shares		—			33,774			—			18,901
Net asset value of shares issued in reinvestment of distributions — Institutional Shares		—			26,561			—			23,120
Net asset value of shares issues in reinvestment of distribution — R6 Shares		—			—			—			—
Cost of shares redeemed — Retail Shares		(24,918,750	)		(18,562,721	)		(1,863,887	)		(1,433,194	)
Cost of shares redeemed — Institutional Shares		(10,343,162	)		(19,895,321	)		(945,931	)		(792,192	)
Cost of shares redeemed — R6 Shares		—			—			(7,599	)		—

Increase (decrease) in net assets derived from capital share transactions		(1,844,530	)		40,750,187			(1,656,361	)		3,892,062

Net increase (decrease) in net assets		24,656,473			10,197,182			(1,804,757	)		3,553,537

Net Assets:
Beginning of year		79,241,714			69,044,532			11,521,872			7,968,335

End of year	$	103,898,187		$	79,241,714		$	9,717,115		$	11,521,872

Undistributed (accumulated) net investment income (loss) at end of year	$	905,895		$	557,992		$	(2,104	)	$	17,414

Capital share transactions — Retail Shares
Shares sold		3,152,753			6,311,650			49,942			275,759
Shares issued in reinvestment of distributions		—			4,381			—			1,505
Shares redeemed		(3,089,243	)		(2,138,039	)		(136,901	)		(101,770	)

Net increase (decrease)		63,510			4,177,992			(86,959	)		175,494

Capital share transactions — Institutional Shares
Shares sold		1,492,155			2,950,290			22,880			144,495
Shares issued in reinvestment of distributions		—			3,414			—			1,831
Shares redeemed		(1,333,782	)		(2,557,117	)		(69,747	)		(55,528	)

Net increase (decrease)		158,373			396,587			(46,867	)		90,798

Capital share transactions — R6 Shares
Shares sold		43,017			—			12,185			—
Shares issued in reinvestment of dividends		—			—			—			—
Shares redeemed		—			—			(542	)		—

Net increase		43,017			—			11,643			—


See Notes to Financial Statements.		33


Baron Select Funds		December 31, 2016

STATEMENT OF CASH FLOWS

FORTHE YEAR ENDED DECEMBER 31, 2016


	Baron Partners Fund
Increase (Decrease) in Cash:
Cash Provided from Operating Activities
Net increase in net assets resulting from operations	$	38,850,442
Adjustments to reconcile net increase in net assets resulting from operations to net cash provided by operating activities:
Purchases of portfolio securities		(355,560,559	)
Proceeds from sales of portfolio securities		812,974,389
Net purchases, sales and maturities of short-term investments		(133,643	)
Increase in dividends and interest receivable		(691,692	)
Decrease in prepaid expenses		1,284
Increase in accrued expenses		84,725
Net realized gain on investments		(131,829,048	)
Change in net unrealized depreciation of investments		89,615,947

Net cash provided by operating activities	$	453,311,845

Cash Used in Financing Activities
Proceeds from shares sold		175,749,215
Payment for shares redeemed		(547,061,060	)
Decrease in payable for borrowings against line of credit		(82,000,000	)

Net cash used in financing activities		(453,311,845	)

Net decrease in cash		—
Cash at beginning of year		—

Cash at end of year		—

Supplemental cash flow information:
Interest paid	$	6,820,260


34		See Notes to Financial Statements.


December 31, 2016		Baron Select Funds

NOTES TO FINANCIAL STATEMENTS

1. ORGANIZATION

Baron Select Funds (the “Trust”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company established as a Delaware statutory trust on April 30, 2003, and accordingly, follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 Financial Services — Investment Companies. The Trust currently offers seven series (individually, a “Fund” and collectively, the “Funds”): Baron Partners Fund, Baron Focused Growth Fund, Baron Real Estate Fund and Baron Energy and Resources Fund, which are non-diversified; and Baron International Growth Fund, Baron Emerging Markets Fund, and Baron Global Advantage Fund, which are diversified. The Funds’ investment objective is to seek capital appreciation. Baron Partners Fund may employ “leverage” by borrowing money and using it to purchase additional securities. Borrowing for investment increases both investment opportunity and investment risk. Baron International Growth Fund, Baron Emerging Markets Fund and Baron Global Advantage Fund invest their assets primarily in non-U.S. companies. Baron Real Estate Fund invests its assets primarily in U.S. and non-U.S. real estate and real estate-related companies. Baron Energy and Resources Fund invests its assets primarily in U.S. and non-U.S. energy and resources companies and related companies and energy and resources master limited partnerships (“MLPs”) of any market capitalization.

Each Fund offers Retail Shares, Institutional Shares and R6 Shares. Each class of shares differs only in its ongoing fees, expenses and eligibility requirements. Retail Shares are offered to all investors. Institutional Shares are for investments in the amount of $1 million or more per Fund. Institutional Shares are intended for certain financial intermediaries that offer shares of Baron Funds through fee-based platforms, retirement platforms or other platforms. R6 Shares are for investments in the amount of $5 million or more per Fund. R6 Shares are available only to qualified 401(a) plans (including 401(k) plans, Keogh plans, profit sharing plans, money purchase pension plans, target benefit plans, defined benefit pension plans and Taft-Hartley multi-employer pension plans), endowment funds and foundations, any state, county or city, or its instrumentality, department, authority, or agency, 457 plans, including 457(a) governmental entity plans and tax-exempt plans, accounts registered to insurance companies, trust companies and bank trust departments, investment companies, both affiliated and not affiliated with the adviser, and any entity that is considered a corporation for tax purposes, including corporate non-qualified deferred compensation plans of such corporations. Each class of shares has equal rights to earnings and assets, except that each class bears different expenses for distribution and shareholder servicing. Each Fund’s investment income, realized and unrealized gains or losses on investments and foreign currency, and expenses other than those attributable to a specific class are allocated to each class based on its relative net assets. Each class of shares has exclusive voting rights with respect to matters that affect just that class.

Baron Partners Fund was organized originally as a limited partnership in January 1992 under the laws of the State of Delaware. Effective as of the close of business on April 30, 2003, the predecessor partnership was reorganized into a series of the Trust. Baron Partners Fund commenced operations on April 30, 2003 with a contribution of assets and liabilities, including securities-in-kind, from the predecessor partnership.

Baron Focused Growth Fund was organized originally as a limited partnership in May 1996 under the laws of the State of Delaware. Effective as of the close of business on June 30, 2008, the predecessor partnership was reorganized into a series of the Trust. Baron Focused Growth Fund commenced operations on June 30, 2008 with a contribution of assets and liabilities, including securities-in-kind, from the predecessor partnership.

2. SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies followed by the Funds. The policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the amounts of income and expenses during the period. Actual results could differ from those estimates. Events occurring subsequent to the date of the Statements of Assets and Liabilities and through the date of issuance of the financial statements have been evaluated for adjustment to or disclosure in the financial statements.

a) Security Valuation. The Funds’ share prices or net asset values (“NAV”) are calculated as of the scheduled close of the regular trading session (usually 4 p.m. E.T. or such other time as of which the Funds’ NAV is calculated (the “NAV Calculation Time”)) on the New York Stock Exchange (the “Exchange”) on any day the Exchange is scheduled to be open. Portfolio securities traded on any national stock exchange are valued based on the last sale price on the exchange where such shares are principally traded. For securities traded on NASDAQ, the Funds use the NASDAQ Official Closing Price. If there are no sales on a given day, the value of the security may be the average of the most recent bid and asked quotations on such exchange or the last sale price from a prior day. Where market quotations are not readily available, or, if in BAMCO, Inc.’s (the “Adviser”) judgment, they do not accurately reflect the fair value of a security, or an event occurs after the market close but before the Funds are priced that materially affects the value of a security, the security will be valued by the Adviser using policies and procedures approved by the Board of Trustees (the “Board”). The Adviser has a Fair Valuation Committee (the “Committee”) comprised of senior management representatives and the Committee reports to the Board every quarter. Factors the Committee may consider when valuing a security include whether a current price is stale, there is recent news, the security is thinly traded, transactions are infrequent or quotations are genuine. There can be no guarantee, however, that a fair valuation used by the Funds on any given day will more accurately reflect the market value of an investment than the closing price of such investment in its market. U.S. Government obligations, money market instruments, and other debt instruments held by the Funds with a remaining maturity of 60 days or less are generally valued at amortized cost, which approximates fair value. Debt instruments having a greater remaining maturity will be valued on the basis of prices obtained from a pricing service approved by the Board or at the mean of the bid and ask prices from the dealer maintaining an active market in that security. The value of the Funds’ investments in convertible bonds is determined primarily by obtaining valuations from independent pricing services based on readily available bid quotations or, if quotations are not available, by methods which include various considerations such as yields or prices of securities of comparable quality, coupon, maturity and type; indications as to values from dealers; and general market conditions. Other inputs used by an independent pricing service to value convertible bonds generally include underlying stock data, conversion premiums, listed bond and preferred stock prices and other market information which may include benchmark curves, trade execution data, and sensitivity analysis, when available. Open-end investment companies, including securities lending collateral invested in registered investment company money market funds, are valued at their NAV each day.


Baron Select Funds		December 31, 2016

NOTES TO FINANCIAL STATEMENTS (Continued)

2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

Non-U.S. equity securities are valued on the basis of their most recent closing market prices and translated into U.S. dollars at the NAV Calculation Time, except under the circumstances described below. Most foreign markets close before the NAV Calculation Time. For securities primarily traded in the Far East, for example, the most recent closing prices may be as much as 15 hours old at the NAV Calculation Time. As a result, the Adviser may use a third-party pricing service to assist in determining fair value of foreign securities. This service utilizes a systematic methodology in making fair value estimates. The Adviser may also fair value securities in other situations, for example, when a particular foreign market is closed but the Funds are open. The Adviser cannot predict how often it will use closing prices or how often it will adjust those prices. As a means of evaluating its fair value process, the Adviser routinely compares closing market prices, the next day’s opening prices in the same markets, and the adjusted prices. Other mutual funds may adjust the prices of their securities by different amounts.

b) Securities Transactions, Investment Income and Expense Allocation. Securities transactions are recorded on a trade date basis. Realized gain and loss from securities transactions are recorded on an identified cost basis for financial reporting and federal income tax purposes. Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis, which includes the accretion of discounts and amortization of premiums. Certain dividends from foreign securities will be recorded as soon as the Funds are informed of the dividend if such information is obtained subsequent to the ex-dividend date. Distributions received from certain investments held by the Funds may be comprised of dividends, realized gains and returns of capital. The Funds originally estimate the expected classification of such payments. The amounts may subsequently be reclassified upon receipt of information from the issuer. The Funds are charged for those expenses of the Trust that are directly attributable to each Fund, such as advisory and custodian fees. Expenses that are not directly attributable to a Fund are typically allocated among the Funds in proportion to their respective net assets.

c) Foreign Currency Translations. Values of assets and liabilities denominated in foreign currencies are translated into U.S. dollars using the price of such currencies at the time the net asset value is determined. Purchases and sales of investments and dividend income are converted at the prevailing rate of exchange on the respective dates of such transactions. Net realized gain (loss) on foreign currency transactions includes gain (loss) arising from the fluctuation in the exchange rates between trade and settlement dates on security transactions and currency gain (loss) between the accrual and payment dates on dividends and foreign withholding taxes. The Funds do not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments and foreign currency transactions on the Statements of Operations. The Funds may invest in foreign securities and foreign currency transactions that may involve risks not associated with domestic investments as a result of the level of governmental supervision and regulation of foreign securities markets and the possibility of political or economic instability, among others.

Pursuant to U.S. federal income tax regulations, gains and losses from certain foreign currency transactions and the foreign currency portion of gains and losses realized on sales and maturities of foreign denominated debt securities are generally treated as ordinary income for U.S. federal income tax purposes.

d) Securities Lending. The Funds may lend securities to certain brokers under the terms of a master netting agreement. Upon such loans, the Funds receive collateral which is maintained by the custodian. The Funds may pay fees to the custodian for administering the securities lending program. The Funds earn interest on such collateral and earn income in the form of negotiated lenders’ fees, both of which are included in securities lending income in the Statements of Operations. Securities loaned are required to be secured at all times by collateral equal to at least 102% of the market value of the securities loaned. Risks may arise upon entering into securities lending to the extent that the value of the collateral is less than the value of the securities loaned due to the changes in the value of collateral or the loaned securities. The collateral is marked-to-market daily and settled on the next business day. The Funds may receive collateral in the form of cash or other eligible securities, such as a letter of credit issued by a U.S. bank or securities issued or guaranteed by the U.S. government. Securities purchased with cash collateral are subject to the risks inherent in investing in these securities.

The Funds did not hold derivatives or participate in securities lending/borrowing activities at December 31, 2016.

e) Repurchase Agreements. The Funds may invest in repurchase agreements, which are short term investments whereby the Funds acquire ownership of a debt security and the seller agrees to repurchase the security at a future date at a specified price. When entering into repurchase agreements, it is the Funds’ policy that their custodian take possession of the underlying collateral securities, the market value of which, at all times, equals at least 102% of the principal amount of the repurchase transaction. To the extent that any repurchase transaction exceeds one business day, the value of the collateral is marked-to-market to ensure the adequacy of the collateral. If the seller defaults and the market value of the collateral declines or if bankruptcy proceedings are commenced with respect to the seller of the security, realization of the collateral by the Funds may be delayed or limited. The information required to be disclosed by ASU No. 2011-11 for the Funds’ investments in repurchase agreements at December 31, 2016, including the fair value of the repurchase agreement and the amount of collateral, can be found in each respective Fund’s Statement of Net Assets.

f) Master Limited Partnerships. The Funds may invest in master limited partnerships (“MLPs”). MLPs are limited partnerships or limited liability companies, whose partnership units or limited liability interests are listed and traded on a U.S. securities exchange, and are treated as publicly traded partnerships for federal income tax purposes. To qualify to be treated as a partnership for tax purposes, an MLP must receive at least 90% of its income from qualifying sources as set forth in Section 7704(d) of the Internal Revenue Code of 1986, as amended. These qualifying sources include interest, dividend, real property rent, gain from sale or other disposition of real property and income from activities such as the exploration, development, mining, production, processing, refining, transportation, storage and marketing of mineral or natural resources.

g) Federal and Foreign Income Taxes. The Trust treats each Fund as a separate entity for federal income tax purposes. Each Fund intends to meet the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies, and to distribute to its shareholders substantially all of its net investment income and any net realized capital gains at least annually. None of the Funds will be subject to federal or state income taxes to the extent that they qualify as regulated investment companies and substantially all of their income is distributed.

The Funds may be subject to foreign taxes on income and gains on investments that are accrued based upon the Funds’ understanding of the tax rules and regulations that exist in the countries in which the Funds invest. Foreign governments may also impose taxes or other payments on investments with respect to foreign securities. Such taxes are accrued as applicable.


December 31, 2016		Baron Select Funds

NOTES TO FINANCIAL STATEMENTS (Continued)

2. SIGNIFICANT ACCOUNTING POLICIES (Continued)

h) Restricted Securities. The Funds may invest in securities that are restricted as to public sale in accordance with the Securities Act of 1933. Such assets are valued by the Adviser pursuant to policies and procedures approved by the Board.

i) Distributions to Shareholders. Income and capital gain distributions to shareholders are determined in accordance with income tax regulations which may differ from GAAP. These differences are primarily due to differing treatments for net investment loss, foreign currency gains and losses, reclassification of distributions, partnership basis adjustments, income from passive foreign investment companies and wash sale losses deferred.

j) Commitments and Contingencies. In the normal course of business, the Funds may enter into contracts and agreements that contain a variety of representations and warranties, which provide general indemnification. The maximum exposure to the Funds under these agreements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, based on experience, the Funds expect the risk of loss to be remote.

k) Cash and Cash Equivalents. The Funds consider all short term liquid investments with a maturity of three months or less when purchased to be cash equivalents.

l) Fund Diversification and Concentration. Certain of the Funds hold non-diversified or concentrated portfolios that may contain fewer securities or invest in fewer industries than the portfolios of other mutual funds. This may increase the risk that the value of a Fund could decrease because of the poor performance of one or a few investments or of a particular industry. Additionally, non-diversified funds may encounter difficulty liquidating securities.

3. PURCHASES AND SALES OF SECURITIES

Purchases and sales of securities, other than short term securities, for the year ended December 31, 2016 were as follows:


Fund	Purchases		Sales
Baron Partners Fund	$	335,162,545	$	800,682,320
Baron Focused Growth Fund		23,941,459		29,429,901
Baron International Growth Fund		32,146,210		48,507,896
Baron Real Estate Fund		687,487,856		1,422,834,791
Baron Emerging Markets Fund		1,347,989,215		487,757,605
Baron Energy and Resources Fund		58,894,392		49,153,209
Baron Global Advantage Fund		2,215,346		3,961,744

4. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES

a) Investment Advisory Fees. The Adviser, a wholly owned subsidiary of Baron Capital Group, Inc. (“BCG”), serves as investment adviser to the Funds. As compensation for services rendered, the Adviser receives a fee payable monthly equal to 1% per annum of the average daily net assets of the respective Funds. The Adviser has contractually agreed to reduce its fee, to the extent required to limit the net annual operating expense ratio (excluding portfolio transaction costs, interest, dividend and extraordinary expenses), as follows:


	Annual Operating Expense Ratio Cap
Fund	Retail Shares			Institutional Shares			R6 Shares
Baron Partners Fund		1.45	%		1.20	%		1.20	%
Baron Focused Growth Fund		1.35	%		1.10	%		1.10	%
Baron International Growth Fund		1.50	%		1.25	%		1.24	%
Baron Real Estate Fund		1.35	%		1.10	%		1.10	%
Baron Emerging Markets Fund		1.50	%		1.25	%		1.25	%
Baron Energy and Resources Fund		1.35	%		1.10	%		1.09	%
Baron Global Advantage Fund		1.50	%		1.25	%		1.24	%

b) Distribution Fees. Baron Capital, Inc. (“BCI”), a wholly owned subsidiary of BCG, is a registered limited purpose broker-dealer and the distributor of the Funds’ shares. The Funds are authorized to pay BCI a distribution fee payable monthly pursuant to a distribution plan under Rule 12b-1 of the 1940 Act equal to 0.25% per annum of the Retail Shares’ average daily net assets of the respective Funds.

c) Trustee Fees. Certain Trustees of the Trust may be deemed to be affiliated with, or interested persons (as defined by the 1940 Act) of the Funds’ Adviser or of BCI. None of the Trustees so affiliated received compensation for his or her services as a Trustee of the Trust. None of the Funds’ officers received compensation from the Funds for their services as an officer.

d) Fund Accounting and Administration Fees. The Funds have entered into an agreement with State Street Bank and Trust Company (“State Street”) to perform accounting and certain administrative services. State Street is compensated for fund accounting services based on a percentage of the Funds’ net assets, subject to certain minimums plus fixed annual fees for the administrative services.

e) Cross Trades. The Funds are permitted to purchase securities from, or sell securities to, other Funds within the Trust, other funds in the Baron Investment Funds Trust, and other entities advised or subadvised by the Adviser, pursuant to “Cross-Trading” Procedures adopted by the Board. These procedures have been designed to ensure that any cross-trade of securities by a Fund from or to another fund/other entity that is or could be considered an affiliate of the respective Baron Fund under certain limited


Baron Select Funds		December 31, 2016

NOTES TO FINANCIAL STATEMENTS (Continued)

4. INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES (Continued)

circumstances by virtue of having a common investment adviser, common officers, or common Trustees complies with Rule 17a-7 under the 1940 Act. Further, as defined under these procedures, each cross-trade is effected at the current market price and with no commissions. Pursuant to these procedures, for the year ended December 31, 2016, the Funds engaged in the following cross-trades, which resulted in the following net realized gains (losses):


	Purchases		Sales		Net Realized Gains (Losses)
Baron Partners Fund	$	1,521,507	$	1,494,967	$	(435,111	)
Baron International Growth Fund		39,975		—		—
Baron Real Estate Fund		—		3,491,760		(244,583	)
Baron Emerging Markets Fund		666,250		—		—

5. LINE OF CREDIT

Baron Partners Fund participates in a committed syndicated line of credit agreement with State Street in the amount of $600 million. Depending on the outstanding loan amount, a commitment fee of 0.15% or 0.25% per annum is incurred on the unused portion of the line of credit. The line of credit is used for investment purposes and expires on November 3, 2017. Baron Partners Fund may borrow up to the lesser of $600 million or the maximum amount Baron Partners Fund may borrow under the 1940 Act, the limitations included in Baron Partners Fund’s prospectus, or any limit or restriction under any law or regulation to which Baron Partners Fund is subject or any agreement to which Baron Partners Fund is a party. Interest is charged to Baron Partners Fund, based on its borrowings, at a rate per annum equal to the higher of the Federal Funds Rate or the One Month LIBOR Rate plus a margin of 0.85%. An upfront fee of 0.05% is incurred on the commitment amount. For the year ended December 31, 2016, interest expense incurred on these loans amounted to $6,948,906. During the year ended December 31, 2016, Baron Partners Fund had an average daily balance on the line of credit of $505.2 million at a weighted average interest rate of 1.38%. At December 31, 2016, Baron Partners Fund had an outstanding balance in the amount of $475,000,000.

The Funds (except Baron Partners Fund), together with the funds in Baron Investment Funds Trust, participate in a committed line of credit agreement with State Street to be used for temporary purposes, primarily for financing redemptions. Each fund may borrow up to the lesser of $100 million or the maximum amount each fund may borrow under the 1940 Act, the limitations included in each fund’s prospectus, or any limit or restriction under any law or regulation to which each fund is subject or any agreement to which each fund is a party; provided that the aggregate outstanding principal amount of all loans to any of the funds may not exceed $100 million. Interest is charged to each fund, based on its borrowings, at a rate per annum equal to the higher of the Overnight Federal Funds Rate or the One Month LIBOR Rate plus a margin of 1.00%. An upfront fee of 0.05% is incurred on the commitment amount and a commitment fee of 0.20% per annum is incurred on the unused portion of the line of credit. Both fees are allocated to the participating funds based on their relative net assets.

During the year ended December 31, 2016, Baron Energy and Resources Fund had borrowings under the line of credit and incurred interest expense of $852. For the three days during which there were borrowings, Baron Energy and Resources Fund had an average daily balance on the line of credit of $5.8 million at a weighted average interest rate of 1.75%.

6. RESTRICTED SECURITIES

At December 31, 2016, investments in securities included securities that are restricted and/or illiquid. Restricted securities are often purchased in private placement transactions, are not registered under the Securities Act of 1933, may have contractual restrictions on resale and are valued pursuant to the policies and procedures for fair value pricing approved by the Board. A security may be considered illiquid if it lacks a readily available market or if its valuation has not changed for a certain period of time. The Funds may receive more or less than this valuation in an actual sale and that difference could be material. At December 31, 2016, the Funds held investments in restricted and/or illiquid securities that were valued pursuant to policies and procedures for fair value pricing as follows:


	Baron Partners Fund
Name of Issuer	Acquisition Date(s)		Value
Private Equity Investments
Windy City Investments Holdings, L.L.C.		11/13/2007-1/27/2011	$	3,456,083

(Cost $0) (0.22% of Net Assets)

7. FAIR VALUE MEASUREMENTS

Fair value is defined by GAAP as the price that the Funds would receive upon selling an investment in a timely transaction to an independent buyer in the principal or most advantageous market for the investment. GAAP provides a three-tier hierarchy to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability. Inputs may be observable or unobservable. Observable inputs are based on market data obtained from sources independent of the Funds. Unobservable inputs are inputs that reflect the Funds’ own assumptions based on the best information available in the circumstances. The three-tier hierarchy of inputs is summarized in the three broad Levels listed below.

•

Level 1 — quoted prices in active markets for identical assets or liabilities;

•

Level 2 — prices determined using other inputs that are observable either directly, or indirectly through corroboration with observable market data (which could include quoted prices for similar assets or liabilities, interest rates, credit risk, etc.);


December 31, 2016		Baron Select Funds

NOTES TO FINANCIAL STATEMENTS (Continued)

7. FAIR VALUE MEASUREMENTS (Continued)

•

Level 3 — prices determined using unobservable inputs when quoted prices or observable inputs are unavailable, such as when there is little or no market activity for an asset or liability (unobservable inputs reflect each Fund’s own assumptions in determining the fair value of assets or liabilities and would be based on the best information available).

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For example, non-U.S. securities, with markets that close hours before the Funds value their holdings, may require revised valuations due to significant movement in the U.S. markets. Since these values are not obtained from quoted prices in an active market, such securities are reflected as Level 2.

The Funds have procedures to determine the fair value of securities and other financial instruments for which market prices are not readily available or which may not be reliably priced. Under these procedures, the Funds primarily employ a market-based approach that may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine its fair value. The Funds may also use an income-based valuation approach in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed.

The following is a summary of the inputs used as of December 31, 2016 in valuing the Funds’ investments carried at fair value:


	Baron Partners Fund
Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)		Total
Common Stocks^†	$	2,037,110,016	$	—	$	—	$	2,037,110,016
Private Equity Investments		—		—		3,456,083		3,456,083
Short Term Investments		—		274,928		—		274,928

Total Investments	$	2,037,110,016	$	274,928	$	3,456,083	$	2,040,841,027

Transfers between Levels 1, 2 or 3, if any, are recognized at ending value on December 31, 2016. There have been no transfers in and out of Level 1, 2 or 3 fair value measurements for the Fund for the year ended December 31, 2016.


	Baron Focused Growth Fund
Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)		Total
Common Stocks^†	$	159,078,855	$	—	$	—	$	159,078,855
Preferred Stocks		—		7,664,733		—		7,664,733
Short Term Investments		—		8,350,534		—		8,350,534

Total Investments	$	159,078,855	$	16,015,267	$	—	$	175,094,122


	Baron International Growth Fund
Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)		Total
Common Stocks^†	$	76,287,815	$	2,714,916	$	—	$	79,002,731
Short Term Investments		—		8,384,431		—		8,384,431

Total Investments	$	76,287,815	$	11,099,347	$	—	$	87,387,162

$18,224,224 was transferred out of Level 2 into Level 1 at December 31, 2016 as a result of not adjusting closing prices for certain securities (as described in Note 2a) due to significant market movements between the time at which the Fund valued its securities and the earlier closing of foreign markets. $454,862 was transferred out of Level 2 into Level 1 at December 31, 2016 due to the expiration of a lock-up restriction. It is the Fund’s policy to recognize transfers in and transfers out at the fair value as of the end of the period.

†	See Statements of Net Assets for additional detailed categorizations.


Baron Select Funds		December 31, 2016

NOTES TO FINANCIAL STATEMENTS (Continued)

7. FAIR VALUE MEASUREMENTS (Continued)


	Baron Real Estate Fund
Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)		Total
Common Stocks^†	$	929,272,978	$	—	$	—	$	929,272,978
Short Term Investments		—		24,789,506		—		24,789,506

Total Investments	$	929,272,978	$	24,789,506	$	—	$	954,062,484

$10,475,365 was transferred out of Level 2 into Level 1 at December 31, 2016 as a result of not adjusting closing prices for certain securities (as described in Note 2a) due to significant market movements between the time at which the Fund valued its securities and the earlier closing of foreign markets. It is the Fund’s policy to recognize transfers in and transfers out at the fair value as of the end of the period


	Baron Emerging Markets Fund
Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)		Total
Common Stocks^†	$	1,998,618,610	$	404,671,341	$	—	$	2,403,289,951
Preferred Stocks		446,924		—		—		446,924
Convertible Bonds		—		6,995,938		—		6,995,938
Short Term Investments		—		186,251,623		—		186,251,623

Total Investments	$	1,999,065,534	$	597,918,902	$	—	$	2,596,984,436

$71,224,626 was transferred out of Level 2 into Level 1 at December 31, 2016 as a result of not adjusting closing prices for certain securities (as described in Note 2a) due to significant market movements between the time at which the Fund valued its securities and the earlier closing of foreign markets. $7,658,837 was transferred out of Level 2 into Level 1 at December 31, 2016 due to the expiration of a lock-up restriction. It is the Fund’s policy to recognize transfers in and transfers out at the fair value as of the end of the period.


	Baron Energy and Resources Fund
Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)		Total
Common Stocks^†	$	103,305,611	$	—	$	—	$	103,305,611
Short Term Investments		—		482,492		—		482,492

Total Investments	$	103,305,611	$	482,492	$	—	$	103,788,103

$831,578 was transferred out of Level 2 into Level 1 at December 31, 2016 due to the expiration of a lock-up restriction. Transfers between Levels 1, 2 or 3, if any, are recognized at ending value on December 31, 2016.


	Baron Global Advantage Fund
Description	Quoted Prices in Active Markets for Identical Assets (Level 1)		Other Observable Inputs (Level 2)		Unobservable Inputs (Level 3)		Total
Common Stocks^†	$	9,322,995	$	321,956	$	—	$	9,644,951
Short Term Investments		—		146,072		—		146,072

Total Investments	$	9,322,995	$	468,028	$	—	$	9,791,023

†	See Statements of Net Assets for additional detailed categorizations.


December 31, 2016		Baron Select Funds

NOTES TO FINANCIAL STATEMENTS (Continued)

7. FAIR VALUE MEASUREMENTS (Continued)

The following is a reconciliation of investments in which unobservable inputs (Level 3) were used in determining fair value:


	Baron Partners Fund
Investments in Securities	Balance as of December 31, 2015		Accrued Premiums/ Discounts		Net Realized Gain (Loss)		Change in Net Unrealized Appreciation (Depreciation)			Purchases		Sales/ Distributions			Transfers Into Level 3		Transfers Out of Level 3		Balance as of December 31, 2016		Change in Net Unrealized Appreciation (Depreciation) from Investments still held at December 31, 2016
Private Equity Investments
Financials	$	6,442,261	$	—	$	1,071,713	$	(1,153,251	)	$	—	$	(2,904,640	)	$	—	$	—	$	3,456,083	$	(1,153,251	)

8. INCOME TAXES AND DISTRIBUTIONS TO SHAREHOLDERS

Federal income tax regulations differ from GAAP. Therefore, distributions determined in accordance with tax regulations may differ in amount or character from net investment income and net realized gain for financial reporting purposes. Net investment income (loss) and net realized and unrealized gain (loss) differ for financial statement and tax purposes due to differing treatments of net investment loss, foreign currency gains and losses, reclassification of distributions, partnership basis adjustments, income from passive foreign investment companies and wash sale losses deferred. Financial reporting records are adjusted for permanent book/tax differences to reflect tax character. Financial records are not adjusted for temporary differences.

For the year ended December 31, 2016, the Funds recorded the following permanent reclassifications to reflect tax character. Reclassifications between income, gains and paid-in capital relate primarily to the tax treatment of net investment loss, foreign currency gains and losses, and partnership basis adjustments. Results of operations and net assets were not affected by these reclassifications.


Fund	Undistributed (Accumulated) Net Investment Income(Loss)			Undistributed (Accumulated) Net Realized Gain(Loss)			Paid-In Capital
Baron Partners Fund	$	7,478,135		$	422		$	(7,478,557	)
Baron Focused Growth Fund		28,012			(6,745	)		(21,267	)
Baron International Growth Fund		429,528			(66,082	)		(363,446	)
Baron Real Estate Fund		864,411			60,040			(924,451	)
Baron Emerging Markets Fund		(1,532,427	)		1,532,427			—
Baron Energy and Resources Fund		(4,752	)		703,415			(698,663	)
Baron Global Advantage Fund		103,802			49,169			(152,971	)

As of December 31, 2016, the components of net assets on a tax basis were as follows:


	Baron Partners Fund			Baron Focused Growth Fund			Baron International Growth Fund			Baron Real Estate Fund			Baron Emerging Markets Fund			Baron Energy and Resources Fund			Baron Global Advantage Fund
Cost of investments	$	1,268,897,519		$	131,819,244		$	67,990,544		$	773,913,503		$	2,558,420,577		$	81,918,628		$	7,685,717

Gross tax unrealized appreciation		856,080,029			50,339,001			22,155,767			181,095,889			239,048,306			22,910,193			2,834,164
Gross tax unrealized depreciation		(84,136,521	)		(7,064,123	)		(2,759,149	)		(946,908	)		(200,484,447	)		(1,040,718	)		(728,858	)

Net tax unrealized appreciation		771,943,508			43,274,878			19,396,618			180,148,981			38,563,859			21,869,475			2,105,306
Net tax unrealized currency appreciation (depreciation)		—			—			(45,069	)		(67	)		21,511			—			(14	)
Undistributed net investment income		—			—			—			—			1,383,804			—			—
Undistributed net realized gain		—			1,966,491			620,545			—			—			—			—
Qualified late year loss deferral		(2,559,218	)		(1,630,692	)		—			(330	)		(4,854,498	)		(515,307	)		(249,460	)
Capital loss carryforwards		(171,435,095	)		—			—			(29,013,053	)		(190,159,771	)		(32,637,304	)		(603,970	)
Paid-in capital		969,532,485			131,584,275			67,648,367			799,431,193			2,757,038,438			115,181,323			8,465,253

Net Assets	$	1,567,481,680		$	175,194,952		$	87,620,461		$	950,566,724		$	2,601,993,343		$	103,898,187		$	9,717,115


Baron Select Funds		December 31, 2016

NOTES TO FINANCIAL STATEMENTS (Continued)

8. INCOME TAXES AND DISTRIBUTIONS TO SHAREHOLDERS (Continued)

As of December 31, 2016, the Funds had capital loss carryforwards expiring as follows:


	Baron Partners Fund		Baron Focused Growth Fund		Baron International Growth Fund		Baron Real Estate Fund		Baron Emerging Markets Fund		Baron Energy and Resources Fund		Baron Global Advantage Fund
Short term:
December 31, 2017	$	171,435,095	$	—	$	—	$	—	$	—	$	—	$	—
No expiration date		—		—		—		29,013,053		145,314,006		14,587,795		401,348

	$	171,435,095	$	—	$	—	$	29,013,053	$	145,314,006	$	14,587,795	$	401,348

Long term:
No expiration date	$	—	$	—	$	—	$	—	$	44,845,765	$	18,049,509	$	202,622

Capital loss carryforward utilized during the year ended December 31, 2016	$	118,545,297	$	—	$	—	$	—	$	—	$	—	$	—

The tax character of distributions paid during the years ended December 31, 2016 and December 31, 2015 was as follows:


	Year Ended December 31, 2016						Year Ended December 31, 2015
Fund	Ordinary¹		Long Term Capital Gain		Return of Capital		Ordinary¹		Long Term Capital Gain
Baron Partners Fund	$	—	$	—	$	—	$	8,870,821	$	—
Baron Focused Growth Fund		—		10,001,809		—		650,535		9,891,350
Baron International Growth Fund		43,909		703,025		—		673,432		156,070
Baron Real Estate Fund		—		3,756,561		1,500,609		802,173		34,696,513
Baron Emerging Markets Fund		7,977,500		—		—		4,689,931		—
Baron Energy and Resources Fund		—		—		—		71		64,953
Baron Global Advantage Fund		—		—		—		28,281		13,779

¹	For tax purposes, short-term capital gains are considered ordinary income distributions.

The Funds follow the provisions of FASB Codification Section 740 (“ASC Section 740”) “Accounting for Uncertainty in Income Taxes” which clarifies the accounting for uncertainty in tax positions taken or expected to be taken on a tax return. ASC Section 740 sets forth a threshold for financial statement recognition, measurement and disclosure of tax positions taken or expected to be taken on a tax return. The Funds are required to recognize the tax effects of certain tax positions under a “more likely than not” standard, that based on their technical merits, have more than 50 percent likelihood of being sustained upon examination. Management has analyzed the tax positions taken on the Funds’ federal income tax returns for all open years (current and prior three years), and has concluded that no provision for federal income tax is required in the Funds’ financial statements. At December 31, 2016, the Funds did not have any uncertain tax benefits that require recognition, de-recognition or disclosure. The Funds’ federal, state and local income and federal excise tax returns for which the applicable statutes of limitations have not expired (current and prior three years) are subject to examination by the Internal Revenue Service and state departments of revenue.

9. OWNERSHIP CONCENTRATION

As of December 31, 2016, the officers, trustees and portfolio managers owned, directly or indirectly, 44.85% of Baron Focused Growth Fund and 41.44% of Baron Global Advantage Fund. As of December 31, 2016 the officers, trustees, portfolio managers and one other investor owned, directly or indirectly, 27.79% of Baron International Growth Fund. As a result of their ownership, these investors may be able to materially affect the outcome of matters presented to Baron Focused Growth Fund, Baron International Growth Fund and Baron Global Advantage Fund shareholders.

10. TRANSACTIONS IN “AFFILIATED” COMPANIES¹


	Baron Emerging Markets Fund
Name of Issuer	Value at December 31, 2015		Purchase Cost		Sales Proceeds		Change in Net Unrealized Appreciation (Depreciation)		Realized Gains/ (Losses)		Dividend Income		Shares Held at December 31, 2016		Value at December 31, 2016
“Affiliated” Company as of December 31, 2016:
Lekoil Ltd.	$	5,764,928	$	2,951,742	$	—	$	1,958,993	$	—	$	—		33,000,000	$	10,675,663

¹	An “Affiliated” Company (“affiliated person” as defined in the 1940 Act) is a company in which a Fund held 5% or more of the company’s outstanding voting securities at any time during the year ended December 31, 2016.


December 31, 2016		Baron Select Funds

NOTES TO FINANCIAL STATEMENTS (Continued)

11. RECENT ACCOUNTING PRONOUNCEMENTS

On August 26, 2016, Financial Accounting Standards Board (“FASB”) issued a new Accounting Standards Update No. 2016-15, “Statement of Cash Flows (Topic 230), a consensus of the FASB’s Emerging Issues Task Force” (“ASU 2016-15”). ASU 2016-15 is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. The issues addressed in ASU 2016-15 are: debt prepayment or debt extinguishment costs, settlement of zero-coupon debt instruments, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies, distributions received from equity method investments, beneficial interests in securitization transactions; and, separately identifiable cash flows and application of the predominance principle. ASU 2016-15 is effective for interim and annual reporting periods beginning after December 15, 2017. Management is currently evaluating the impact, if any, of applying this provision.

In October 2016, the U.S. Securities and Exchange Commission (“SEC”) adopted new rules and forms, and amendments to certain current rules and forms, to modernize reporting and disclosure of information by registered investment companies. The amendments to Regulation S-X will require standardized, enhanced disclosure about derivatives in investment company financial statements, and will also change the rules governing the form and content of such financial statements. The compliance date for the amendments to Regulation S-X is August 1, 2017. The Adviser is currently evaluating the impact that the adoption of the amendments to Regulation S-X will have on the Funds’ financial statements and related disclosures.

In November 2016, FASB issued a new Accounting Standards Update No. 2016-18, “Statement of Cash Flows (Topic 230), Restricted Cash, a consensus of the FASB’s Emerging Issues Task Force” (“ASU 2016-18”). ASU 2016-18 requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments in ASU 2016-18 do not provide a definition of restricted cash or restricted cash equivalents. ASU 2016-18 is effective for interim and annual reporting periods beginning after December 15, 2017. Management is currently evaluating the impact, if any, of applying this provision.

In December 2016, the Financial Accounting Standards Board issued Accounting Standards Update No. 2016-19 (“ASU 2016-19”), “Technical Corrections and Improvements.” The guidance includes an amendment to Topic 820, Fair Value Measurement, which clarifies the difference between a valuation approach and a valuation technique when applying the guidance in that Topic. The amendment also requires an entity to disclose when there has been a change in either or both a valuation approach and/or a valuation technique. The transition guidance for the amendment must be applied prospectively because it could potentially involve the use of hindsight that includes fair value measurements. The guidance is effective for interim periods beginning after December 15, 2016. Management is currently evaluating the implication, if any, of the additional disclosure requirements and its impact on the Funds’ financial statements.


Baron Select Funds		December 31, 2016

FINANCIAL HIGHLIGHTS

BARON PARTNERS FUND

Selected data for a share outstanding throughout each year:


	RETAIL SHARES
	Year Ended December 31,
	2016			2015			2014			2013			2012			2011			2010			2009			2008			2007
Net asset value, beginning of year	$	35.62		$	36.74		$	33.32		$	22.56		$	19.39		$	20.57		$	15.64		$	12.20		$	23.76		$	22.34

Income (loss) from investment operations:
Net investment income (loss)		(0.11	)¹		(0.05	)¹		0.23	¹		(0.19	)¹		(0.04	)¹		(0.14	)¹		(0.09	)¹		(0.04	)¹		(0.09	)¹		(0.21	)¹
Net realized and unrealized gain (loss) on investments		1.55			(0.95	)		3.19			10.95			3.21			(1.04	)		5.02			3.48			(10.74	)		2.74

Total from investment operations		1.44			(1.00	)		3.42			10.76			3.17			(1.18	)		4.93			3.44			(10.83	)		2.53

Less distributions to shareholders from:
Net investment income		0.00			(0.12	)		0.00			0.00			0.00			0.00			0.00			0.00			0.00			0.00
Net realized gain on investments		0.00			0.00			0.00			0.00			0.00			0.00			0.00			0.00			(0.73	)		(1.11	)

Total distributions		0.00			(0.12	)		0.00			0.00			0.00			0.00			0.00			0.00			(0.73	)		(1.11	)

Net asset value, end of year	$	37.06		$	35.62		$	36.74		$	33.32		$	22.56		$	19.39		$	20.57		$	15.64		$	12.20		$	23.76

Total return		4.04	%		(2.71	)%		10.26	%		47.69	%		16.35	%		(5.74	)%		31.52	%		28.20	%		(46.67	)%		11.34	%

Ratios/Supplemental data:
Net assets (in millions), end of year	$	913.9		$	1,107.5		$	1,256.3		$	1,125.6		$	653.7		$	970.4		$	1,251.9		$	1,249.3		$	1,501.3		$	3,384.1

Ratio of total expenses to average net assets		1.78	%		1.52	%		1.51	%		1.67	%		1.74	%		1.71	%		1.71	%		1.51	%		1.86	%²		1.88	%²
Less: Ratio of interest expense to average net assets		(0.43	)%		(0.20	)%		(0.19	)%		(0.29	)%		(0.34	)%		(0.36	)%		(0.34	)%		(0.10	)%		(0.51	)%		(0.57	)%

Ratio of operating expenses to average net assets		1.35	%		1.32	%		1.32	%		1.38	%		1.40	%		1.35	%		1.37	%		1.41	%		1.35	%		1.31	%

Ratio of net investment income (loss) to average net assets		(0.31	)%		(0.13	)%		0.66	%		(0.66	)%		(0.18	)%		(0.69	)%		(0.51	)%		(0.30	)%		(0.49	)%		(0.86	)%

Portfolio turnover rate		15.59	%		17.08	%		30.82	%		18.57	%		13.04	%		16.96	%		15.85	%		32.43	%		38.02	%		32.95	%

	INSTITUTIONAL SHARES																											R6 SHARES
	Year Ended December 31,																											Year Ended December 31,
	2016			2015			2014			2013			2012			2011			2010			2009³						2016⁶
Net asset value, beginning of year	$	36.15		$	37.28		$	33.72		$	22.78		$	19.52		$	20.66		$	15.66		$	12.66					$	38.61

Income (loss) from investment operations:
Net investment income (loss)		(0.02	)¹		0.04	¹		0.25	¹		(0.12	)¹		0.04	¹		(0.08	)¹		(0.06	)¹		(0.03	)¹					(0.01	)¹
Net realized and unrealized gain (loss) on investments		1.57			(0.95	)		3.31			11.06			3.22			(1.06	)		5.06			3.03						(0.89	)

Total from investment operations		1.55			(0.91	)		3.56			10.94			3.26			(1.14	)		5.00			3.00						(0.90	)

Less distributions to shareholders from:
Net investment income		0.00			(0.22	)		0.00			0.00			0.00			0.00			0.00			0.00						0.00
Net realized gain on investments		0.00			0.00			0.00			0.00			0.00			0.00			0.00			0.00						0.00

Total distributions		0.00			(0.22	)		0.00			0.00			0.00			0.00			0.00			0.00						0.00

Net asset value, end of year	$	37.70		$	36.15		$	37.28		$	33.72		$	22.78		$	19.52		$	20.66		$	15.66					$	37.71

Total return		4.29	%		(2.43	)%		10.56	%		48.02	%		16.70	%		(5.52	)%		31.93	%		23.70	%⁴					(2.33	)%⁴

Ratios/Supplemental data:
Net assets (in millions), end of year	$	645.3		$	793.3		$	681.5		$	349.0		$	146.5		$	123.7		$	119.9		$	158.5					$	8.3

Ratio of total expenses to average net assets		1.52	%		1.26	%		1.26	%		1.41	%		1.48	%		1.45	%		1.45	%		1.38	%⁵					1.62	%⁵
Less: Ratio of interest expense to average net assets		(0.43	)%		(0.20	)%		(0.20	)%		(0.30	)%		(0.35	)%		(0.36	)%		(0.34	)%		(0.21	)%⁵					(0.53	)%⁵

Ratio of operating expenses to average net assets		1.09	%		1.06	%		1.06	%		1.11	%		1.13	%		1.09	%		1.11	%		1.17	%⁵					1.09	%⁵

Ratio of net investment income (loss) to average net assets		(0.05	)%		0.11	%		0.69	%		(0.41	)%		0.18	%		(0.41	)%		(0.36	)%		(0.31	)%⁵					(0.04	)%⁵

Portfolio turnover rate		15.59	%		17.08	%		30.82	%		18.57	%		13.04	%		16.96	%		15.85	%		32.43	%					15.59	%

¹ Based on average shares outstanding.

² Benefit of expense reduction rounds to less than 0.01%.

³ For the period May 29, 2009 (initial offering of Institutional Shares) to December 31, 2009.

⁴ Not Annualized.

⁵ Annualized.

⁶ For the period August 31, 2016 (initial offering of R6 Shares) to December 31, 2016.


44		See Notes to Financial Statements.


December 31, 2016		Baron Select Funds

FINANCIAL HIGHLIGHTS (Continued)

BARON FOCUSED GROWTH FUND

Selected data for a share outstanding throughout each year:


	RETAIL SHARES
	Year Ended December 31,
	2016			2015			2014			2013			2012			2011			2010			2009			2008¹
Net asset value, beginning of year	$	13.09		$	14.21		$	13.97		$	11.26		$	9.71		$	9.85		$	8.14		$	6.27		$	10.00

Income (loss) from investment operations:
Net investment income (loss)		0.01	²		(0.01	)²		0.04	²		(0.07	)²		0.24	²		(0.07	)²		(0.01	)²		0.12	²		0.00	^2,3
Net realized and unrealized gain (loss) on investments		0.08			(0.35	)		0.29			2.95			1.31			(0.07	)		2.05			2.00			(3.33	)

Total from investment operations		0.09			(0.36	)		0.33			2.88			1.55			(0.14	)		2.04			2.12			(3.33	)

Less distributions to shareholders from:
Net investment income		0.00			(0.02	)		0.00			(0.17	)		0.00			0.00			(0.33	)		(0.13	)		0.00
Net realized gain on investments		(0.75	)		(0.74	)		(0.09	)		0.00			0.00			0.00			0.00			0.00			0.00
Return of capital		0.00			0.00			0.00			0.00			0.00			0.00			0.00			(0.12	)		(0.40	)

Total distributions		(0.75	)		(0.76	)		(0.09	)		(0.17	)		0.00			0.00			(0.33	)		(0.25	)		(0.40	)

Net asset value, end of year	$	12.43		$	13.09		$	14.21		$	13.97		$	11.26		$	9.71		$	9.85		$	8.14		$	6.27

Total return		0.67	%⁴		(2.42	)%⁴		2.35	%⁴		25.69	%⁴		15.96	%⁴		(1.42	)%⁴		25.17	%⁴		33.77	%⁴		(33.11	)%^4,5

Ratios/Supplemental data:
Net assets (in millions), end of year	$	37.7		$	43.7		$	46.1		$	47.6		$	31.4		$	28.3		$	46.4		$	39.9		$	59.3

Ratio of operating expenses to average net assets		1.43	%		1.39	%		1.39	%		1.42	%		1.48	%		1.48	%		1.47	%		1.52	%		1.54	%⁶
Less: Reimbursement of expenses by Adviser		(0.08	)%		(0.04	)%		(0.04	)%		(0.07	)%		(0.13	)%		(0.13	)%		(0.12	)%		(0.17	)%		(0.19	)%⁶

Ratio of net operating expenses to average net assets		1.35	%		1.35	%		1.35	%		1.35	%		1.35	%		1.35	%		1.35	%		1.35	%		1.35	%⁶

Ratio of net investment income (loss) to average net assets		0.11	%		(0.10	)%		0.31	%		(0.53	)%		2.30	%		(0.69	)%		(0.16	)%		1.81	%		0.01	%⁶

Portfolio turnover rate		14.31	%		12.18	%		36.92	%		33.67	%		38.38	%		44.58	%		24.08	%		34.76	%		35.43	%⁵

	INSTITUTIONAL SHARES																											R6 SHARES
	Year Ended December 31,																											Year Ended December 31,
	2016			2015			2014			2013			2012			2011			2010			2009⁷						2016⁸
Net asset value, beginning of year	$	13.25		$	14.37		$	14.10		$	11.35		$	9.77		$	9.88		$	8.15		$	6.88					$	13.87

Income (loss) from investment operations:
Net investment income (loss)		0.05	²		0.02	²		0.08	²		(0.04	)²		0.26	²		(0.04	)²		0.01	²		0.07	²					0.02	²
Net realized and unrealized gain (loss) on investments		0.08			(0.34	)		0.28			2.99			1.32			(0.07	)		2.05			1.45						(0.51	)

Total from investment operations		0.13			(0.32	)		0.36			2.95			1.58			(0.11	)		2.06			1.52						(0.49	)

Less distributions to shareholders from:
Net investment income		0.00			(0.06	)		0.00			(0.20	)		0.00			0.00			(0.33	)		(0.13	)					0.00
Net realized gain on investments		(0.75	)		(0.74	)		(0.09	)		0.00			0.00			0.00			0.00			0.00						(0.75	)
Return of capital		0.00			0.00			0.00			0.00			0.00			0.00			0.00			(0.12	)					0.00

Total distributions		(0.75	)		(0.80	)		(0.09	)		(0.20	)		0.00			0.00			(0.33	)		(0.25	)					(0.75	)

Net asset value, end of year	$	12.63		$	13.25		$	14.37		$	14.10		$	11.35		$	9.77		$	9.88		$	8.15					$	12.63

Total return		0.97	%⁴		(2.12	)%		2.54	%		26.09	%⁴		16.17	%⁴		(1.11	)%⁴		25.39	%⁴		22.06	%^4,5					(3.55	)%^4,5

Ratios/Supplemental data:
Net assets (in millions), end of year	$	128.9		$	140.5		$	149.2		$	148.4		$	87.9		$	63.6		$	44.3		$	36.6					$	8.6

Ratio of operating expenses to average net assets		1.13	%		1.09	%		1.09	%		1.12	%		1.16	%		1.18	%		1.19	%		1.25	%⁶					1.14	%⁶
Less: Reimbursement of expenses by Adviser		(0.03	)%		0.00	%		0.00	%		(0.02	)%		(0.06	)%		(0.08	)%		(0.09	)%		(0.15	)%⁶					(0.04	)%⁶

Ratio of net operating expenses to average net assets		1.10	%		1.09	%		1.09	%		1.10	%	��	1.10	%		1.10	%		1.10	%		1.10	%⁶					1.10	%⁶

Ratio of net investment income (loss) to average net assets		0.37	%		0.16	%		0.56	%		(0.28	)%		2.53	%		(0.40	)%		0.08	%		1.63	%⁶					0.53	%⁶

Portfolio turnover rate		14.31	%		12.18	%		36.92	%		33.67	%		38.38	%		44.58	%		24.08	%		34.76	%					14.31	%

¹ For the period June 30, 2008 (commencement of operations) to December 31, 2008.

² Based on average shares outstanding.

³ Less than $0.01 per share.

⁴ The total returns would have been lower had certain expenses not been reduced during the period shown.

⁵ Not Annualized.

⁶ Annualized.

⁷ For the period May 29, 2009 (initial offering of Institutional Shares) to September 30, 2009.

⁸ For the period August 31, 2016 (initial offering of R6 Shares) to December 31, 2016.


See Notes to Financial Statements.		45


Baron Select Funds		December 31, 2016

FINANCIAL HIGHLIGHTS (Continued)

BARON INTERNATIONAL GROWTH FUND

Selected data for a share outstanding throughout each year:


	RETAIL SHARES
	Year Ended December 31,
	2016			2015			2014			2013			2012			2011			2010			2009
Net asset value, beginning of year	$	18.05		$	17.94		$	18.91		$	15.55		$	13.20		$	17.29		$	14.11		$	10.00

Income (loss) from investment operations:
Net investment income (loss)		(0.03	)¹		0.03	¹		0.03	¹		(0.01	)¹		(0.02	)¹		(0.01	)¹		0.01	¹		0.04	¹
Net realized and unrealized gain (loss) on investments		0.24			0.19			(0.46	)		3.37			2.37			(2.78	)		3.38			4.43

Total from investment operations		0.21			0.22			(0.43	)		3.36			2.35			(2.79	)		3.39			4.47

Less distributions to shareholders from:
Net investment income		(0.01	)		(0.08	)		(0.00	)²		0.00			0.00			(0.04	)		0.00			0.00
Net realized gain on investments		(0.16	)		(0.03	)		(0.54	)		0.00			0.00			(1.26	)		(0.21	)		(0.36	)

Total distributions		(0.17	)		(0.11	)		(0.54	)		0.00			0.00			(1.30	)		(0.21	)		(0.36	)

Net asset value, end of year	$	18.09		$	18.05		$	17.94		$	18.91		$	15.55		$	13.20		$	17.29		$	14.11

Total return		1.14	%³		1.23	%³		(2.33	)%³		21.61	%³		17.80	%³		(16.35	)%³		24.22	%³		44.69	%³

Ratios/Supplemental data:
Net assets (in millions), end of year	$	41.8		$	44.9		$	53.0		$	17.0		$	15.6		$	11.7		$	15.3		$	8.4

Ratio of operating expenses to average net assets		1.65	%		1.59	%		1.63	%		1.74	%		1.78	%		1.73	%		1.76	%		2.33	%
Less: Reimbursement of expenses by Adviser		(0.15	)%		(0.09	)%		(0.13	)%		(0.24	)%		(0.28	)%		(0.23	)%		(0.26	)%		(0.83	)%

Ratio of net operating expenses to average net assets		1.50	%		1.50	%		1.50	%		1.50	%		1.50	%		1.50	%		1.50	%		1.50	%

Ratio of net investment income (loss) to average net assets		(0.16	)%		0.15	%		0.14	%		(0.05	)%		(0.16	)%		(0.05	)%		0.07	%		0.38	%

Portfolio turnover rate		38.90	%		42.85	%		34.67	%		40.60	%		39.02	%		53.20	%		32.70	%		53.94	%

	INSTITUTIONAL SHARES																								R6 SHARES
	Year Ended December 31,																								Year Ended December 31,
	2016			2015			2014			2013			2012			2011			2010			2009⁶			2016⁷
Net asset value, beginning of year	$	18.17		$	18.09		$	19.05		$	15.63		$	13.25		$	17.36		$	14.13		$	11.13		$	19.15

Income (loss) from investment operations:
Net investment income (loss)		0.01	¹		0.08	¹		0.12	¹		0.03	¹		0.01	¹		0.03	¹		0.05	¹		(0.02	)¹		(0.02	)¹
Net realized and unrealized gain (loss) on investments		0.24			0.19			(0.50	)		3.39			2.40			(2.79	)		3.39			3.38			(0.71	)

Total from investment operations		0.25			0.27			(0.38	)		3.42			2.41			(2.76	)		3.44			3.36			(0.73	)

Less distributions to shareholders from:
Net investment income		(0.01	)		(0.16	)		(0.04	)		(0.00	)²		(0.03	)		(0.09	)		0.00			0.00			(0.01	)
Net realized gain on investments		(0.16	)		(0.03	)		(0.54	)		0.00			0.00			(1.26	)		(0.21	)		(0.36	)		(0.16	)

Total distributions		(0.17	)		(0.19	)		(0.58	)		(0.00	)²		(0.03	)		(1.35	)		(0.21	)		(0.36	)		(0.17	)

Net asset value, end of year	$	18.25		$	18.17		$	18.09		$	19.05		$	15.63		$	13.25		$	17.36		$	14.13		$	18.25

Total return		1.35	%³		1.48	%³		(2.07	)%³		21.89	%³		18.17	%³		(16.13	)%³		24.54	%³		30.18	%^3,4		(3.83	)%^3,4

Ratios/Supplemental data:
Net assets (in millions), end of year	$	45.4		$	53.7		$	52.3		$	45.4		$	39.0		$	30.5		$	37.4		$	22.1		$	0.4

Ratio of operating expenses to average net assets		1.36	%		1.31	%		1.34	%		1.37	%		1.40	%		1.38	%		1.40	%		1.89	%⁵		1.38	%⁵
Less: Reimbursement of expenses by Adviser		(0.11	)%		(0.06	)%		(0.09	)%		(0.12	)%		(0.15	)%		(0.13	)%		(0.15	)%		(0.64	)%⁵		(0.14	)%⁵

Ratio of net operating expenses to average net assets		1.25	%		1.25	%		1.25	%		1.25	%		1.25	%		1.25	%		1.25	%		1.25	%⁵		1.24	%⁵

Ratio of net investment income (loss) to average net assets		0.07	%		0.41	%		0.64	%		0.20	%		0.09	%		0.19	%		0.31	%		(0.29	)%⁵		(0.31	)%⁵

Portfolio turnover rate		38.90	%		42.85	%		34.67	%		40.60	%		39.02	%		53.20	%		32.70	%		53.94	%		38.90	%

¹ Based on average shares outstanding.

² Less than $0.01 per share.

³ The total returns would have been lower had certain expenses not been reduced during the period shown.

⁴ Not Annualized.

⁵ Annualized.

⁶ For the period May 29, 2009 (initial offering of Institutional Shares) to December 31, 2009.

⁷ For the period August 31, 2016 (initial offering of R6 Shares) to December 31, 2016.


46		See Notes to Financial Statements.


December 31, 2016		Baron Select Funds

FINANCIAL HIGHLIGHTS (Continued)

BARON REAL ESTATE FUND

Selected data for a share outstanding throughout each year:


	RETAIL SHARES
	Year Ended December 31,
	2016			2015			2014			2013			2012			2011			2010
Net asset value, beginning of year	$	24.24		$	25.92		$	22.25		$	17.52		$	12.51		$	12.66		$	10.00

Income (loss) from investment operations:
Net investment income (loss)		(0.02	)¹		(0.06	)¹		0.04	¹		(0.05	)¹		0.01	¹		(0.01	)¹		0.02	¹
Net realized and unrealized gain (loss) on investments		(0.47	)		(1.14	)		3.66			4.80			5.31			0.07	²		2.64

Total from investment operations		(0.49	)		(1.20	)		3.70			4.75			5.32			0.06			2.66

Less distributions to shareholders from:
Net investment income		0.00			(0.01	)		(0.03	)		0.00			0.00			(0.00	)³		0.00
Net realized gain on investments		(0.08	)		(0.47	)		0.00			(0.02	)		(0.31	)		(0.21	)		0.00

Total distributions		(0.08	)		(0.48	)		(0.03	)		(0.02	)		(0.31	)		(0.21	)		0.00

Net asset value, end of year	$	23.67		$	24.24		$	25.92		$	22.25		$	17.52		$	12.51		$	12.66

Total return		(2.01	)%		(4.65	)%		16.61	%		27.12	%		42.60	%⁴		0.63	%⁴		26.60	%⁴

Ratios/Supplemental data:
Net assets (in millions), end of year	$	434.0		$	788.9		$	782.8		$	539.5		$	53.6		$	10.9		$	5.5

Ratio of operating expenses to average net assets		1.33	%		1.31	%		1.32	%		1.35	%		1.76	%		2.33	%		4.35	%
Less: Reimbursement of expenses by Adviser		0.00	%		0.00	%		0.00	%		0.00	%		(0.41	)%		(0.98	)%		(3.00	)%

Ratio of net operating expenses to average net assets		1.33	%		1.31	%		1.32	%		1.35	%		1.35	%		1.35	%		1.35	%

Ratio of net investment income (loss) to average net assets		(0.07	)%		(0.23	)%		0.17	%		(0.23	)%		0.07	%		(0.08	)%		0.14	%

Portfolio turnover rate		55.50	%		50.50	%		24.40	%		19.36	%		30.14	%		70.99	%		58.03	%

	INSTITUTIONAL SHARES																					R6 SHARES
	Year Ended December 31,																					Year Ended December 31,
	2016			2015			2014			2013			2012			2011			2010			2016⁷
Net asset value, beginning of year	$	24.51		$	26.14		$	22.43		$	17.64		$	12.56		$	12.69		$	10.00		$	21.80

Income (loss) from investment operations:
Net investment income (loss)		0.04	¹		0.01	¹		0.11	¹		0.03	¹		0.06	¹		0.02	¹		0.04	¹		0.02	¹
Net realized and unrealized gain (loss) on investments		(0.47	)		(1.16	)		3.68			4.81			5.33			0.07	²		2.65			2.26

Total from investment operations		(0.43	)		(1.15	)		3.79			4.84			5.39			0.09			2.69			2.28

Less distributions to shareholders from:
Net investment income		0.00			(0.01	)		(0.08	)		(0.00	)³		0.00			(0.01	)		0.00			0.00
Net realized gain on investments		(0.08	)		(0.47	)		0.00			(0.02	)		(0.31	)		(0.21	)		0.00			(0.08	)
Return of capital		(0.07	)		0.00			0.00			(0.03	)		0.00			0.00			0.00			(0.07	)

Total distributions		(0.15	)		(0.48	)		(0.08	)		(0.05	)		(0.31	)		(0.22	)		0.00			(0.15	)

Net asset value, end of year	$	23.93		$	24.51		$	26.14		$	22.43		$	17.64		$	12.56		$	12.69		$	23.93

Total return		(1.75	)%		(4.42	)%		16.93	%		27.48	%		42.99	%⁴		0.80	%⁴		26.90	%⁴		10.47	%⁵

Ratios/Supplemental data:
Net assets (in millions), end of year	$	514.6		$	992.8		$	919.7		$	486.1		$	35.5		$	4.9		$	3.2		$	2.0

Ratio of operating expenses to average net assets		1.07	%		1.06	%		1.06	%		1.09	%		1.44	%		2.14	%		4.26	%		1.07	%⁶
Less: Reimbursement of expenses by Adviser		0.00	%		0.00	%		0.00	%		0.00	%		(0.34	)%		(1.04	)%		(3.16	)%		0.00	%

Ratio of net operating expenses to average net assets		1.07	%		1.06	%		1.06	%		1.09	%		1.10	%		1.10	%		1.10	%		1.07	%⁶

Ratio of net investment income (loss) to average net assets		0.19	%		0.04	%		0.44	%		0.15	%		0.36	%		0.17	%		0.36	%		0.08	%⁶

Portfolio turnover rate		55.50	%		50.50	%		24.40	%		19.36	%		30.14	%		70.99	%		58.03	%		55.50	%

¹ Based on average shares outstanding.

² The amount shown for a share outstanding does not correspond with the aggregate realized and unrealized gain (loss) on investments for the period due to the timing of sales and redemptions of Fund shares in relation to fluctuating market values of investments of the Fund.

³ Less than $0.01 per share.

⁴ The total returns would have been lower had certain expenses not been reduced during the period shown.

⁵ Not Annualized.

⁶ Annualized.

⁷ For the period January 29, 2016 (initial offering of R6 Shares) to December 31, 2016.


See Notes to Financial Statements.		47


Baron Select Funds		December 31, 2016

FINANCIAL HIGHLIGHTS (Continued)

BARON EMERGING MARKETS FUND

Selected data for a share outstanding throughout each year:


	RETAIL SHARES
	Year Ended December 31,
	2016			2015			2014			2013			2012			2011
Net asset value, beginning of year	$	10.57		$	11.91		$	11.54		$	10.06		$	8.28		$	10.00

Income (loss) from investment operations:
Net investment income (loss)		0.04	¹		0.03	¹		0.07	¹		(0.06	)¹		(0.04	)¹		(0.03	)¹
Net realized and unrealized gain (loss) on investments		0.36			(1.36	)		0.33			1.54			1.94			(1.69	)

Total from investment operations		0.40			(1.33	)		0.40			1.48			1.90			(1.72	)

Less distributions to shareholders from:
Net investment income		(0.02	)		(0.01	)		(0.03	)		0.00			(0.12	)		0.00
Net realized gain on investments		0.00			0.00			0.00			0.00			0.00			0.00

Total distributions		(0.02	)		(0.01	)		(0.03	)		0.00			(0.12	)		0.00

Net asset value, end of year	$	10.95		$	10.57		$	11.91		$	11.54		$	10.06		$	8.28

Total return		3.75	%		(11.16	)%		3.47	%²		14.71	%²		22.98	%²		(17.20	)%²

Ratios/Supplemental data:
Net assets (in millions), end of year	$	768.5		$	665.5		$	649.7		$	259.6		$	2.9		$	2.0

Ratio of operating expenses to average net assets		1.38	%		1.45	%		1.52	%		1.90	%		4.01	%		4.49	%
Less: Reimbursement of expenses by Adviser		0.00	%		0.00	%		(0.02	)%		(0.40	)%		(2.51	)%		(2.99	)%

Ratio of net operating expenses to average net assets		1.38	%		1.45	%		1.50	%		1.50	%		1.50	%		1.50	%

Ratio of net investment income (loss) to average net assets		0.33	%		0.25	%		0.56	%		(0.53	)%		(0.39	)%		(0.32	)%

Portfolio turnover rate		25.31	%		26.34	%		23.38	%		14.68	%		42.68	%		45.86	%

	INSTITUTIONAL SHARES																		R6 SHARES
	Year Ended December 31,																		Year Ended December 31,
	2016			2015			2014			2013			2012			2011			2016⁵
Net asset value, beginning of year	$	10.59		$	11.94		$	11.56		$	10.05		$	8.30		$	10.00		$	9.94

Income (loss) from investment operations:
Net investment income (loss)		0.06	¹		0.06	¹		0.09	¹		0.01	¹		(0.01	)¹		(0.01	)¹		0.05	¹
Net realized and unrealized gain (loss) on investments		0.37			(1.37	)		0.34			1.50			1.93			(1.69	)		1.04

Total from investment operations		0.43			(1.31	)		0.43			1.51			1.92			(1.70	)		1.09

Less distributions to shareholders from:
Net investment income		(0.04	)		(0.04	)		(0.05	)		0.00			(0.17	)		0.00			(0.04	)
Net realized gain on investments		0.00			0.00			0.00			0.00			0.00			0.00			0.00

Total distributions		(0.04	)		(0.04	)		(0.05	)		0.00			(0.17	)		0.00			(0.04	)

Net asset value, end of year	$	10.98		$	10.59		$	11.94		$	11.56		$	10.05		$	8.30		$	10.99

Total return		4.08	%		(10.97	)%		3.75	%²		15.02	%²		23.22	%²		(17.00	)%²		10.99	%³

Ratios/Supplemental data:
Net assets (in millions), end of year	$	1,832.8		$	1,040.9		$	697.8		$	116.0		$	6.0		$	4.3		$	0.7

Ratio of operating expenses to average net assets		1.13	%		1.20	%		1.27	%		1.80	%		3.37	%		3.83	%		1.13	%⁴
Less: Reimbursement of expenses by Adviser		0.00	%		0.00	%		(0.02	)%		(0.55	)%		(2.12	)%		(2.58	)%		0.00	%

Ratio of net operating expenses to average net assets		1.13	%		1.20	%		1.25	%		1.25	%		1.25	%		1.25	%		1.13	%⁴

Ratio of net investment income (loss) to average net assets		0.57	%		0.49	%		0.76	%		0.05	%		(0.14	)%		(0.07	)%		0.48	%⁴

Portfolio turnover rate		25.31	%		26.34	%		23.38	%		14.68	%		42.68	%		45.86	%		25.31	%

¹ Based on average shares outstanding.

² The total returns would have been lower had certain expenses not been reduced during the period shown.

³ Not Annualized.

⁴ Annualized.

⁵ For the period January 29, 2016 (initial offering of R6 shares) to December 31, 2016.


48		See Notes to Financial Statements.


December 31, 2016		Baron Select Funds

FINANCIAL HIGHLIGHTS (Continued)

BARON ENERGY AND RESOURCES FUND

Selected data for a share outstanding throughout each year:


	RETAIL SHARES
	Year Ended December 31,
	2016			2015			2014			2013			2012
Net asset value, beginning of year	$	7.03		$	10.33		$	11.84		$	9.46		$	10.00

Income (loss) from investment operations:
Net investment income (loss)		0.02	¹		0.02	¹		(0.01	)¹		(0.01	)¹		(0.03	)¹
Net realized and unrealized gain (loss) on investments		1.95			(3.31	)		(1.50	)		2.40			(0.51	)

Total from investment operations		1.97			(3.29	)		(1.51	)		2.39			(0.54	)

Less distributions to shareholders from:
Net investment income		0.00			0.00			0.00			(0.01	)		0.00
Net realized gain on investments		0.00			(0.01	)		0.00			0.00			0.00

Total distributions		0.00			(0.01	)		0.00			(0.01	)		0.00

Net asset value, end of year	$	9.00		$	7.03		$	10.33		$	11.84		$	9.46

Total return		28.02	%²		(31.88	)%²		(12.75	)%²		25.32	%²		(5.40	)%²

Ratios/Supplemental data:
Net assets (in millions), end of year	$	72.8		$	56.4		$	39.7		$	29.2		$	1.8

Ratio of operating expenses to average net assets		1.70	%⁶		1.58	%		1.79	%		2.25	%		9.07	%
Less: Reimbursement of expenses by Adviser		(0.35	)%		(0.23	)%		(0.44	)%		(0.90	)%		(7.72	)%

Ratio of net operating expenses to average net assets		1.35	%		1.35	%		1.35	%		1.35	%		1.35	%

Ratio of net investment income (loss) to average net assets		0.28	%		0.24	%		(0.04	)%		(0.05	)%		(0.36	)%

Portfolio turnover rate		53.52	%		48.19	%		23.12	%		25.60	%		35.74	%

	INSTITUTIONAL SHARES															R6 SHARES
	Year Ended December 31,															Year Ended December 31,
	2016			2015			2014			2013			2012			2016⁵
Net asset value, beginning of year	$	7.10		$	10.41		$	11.91		$	9.48		$	10.00		$	8.55

Income (loss) from investment operations:
Net investment income (loss)		0.04	¹		0.05	¹		0.03	¹		0.02	¹		(0.01	)¹		(0.01	)¹
Net realized and unrealized gain (loss) on investments		1.97			(3.35	)		(1.53	)		2.41			(0.51	)		0.56

Total from investment operations		2.01			(3.30	)		(1.50	)		2.43			(0.52	)		0.55

Less distributions to shareholders from:
Net investment income		0.00			0.00			0.00			0.00			0.00			0.00
Net realized gain on investments		0.00			(0.01	)		0.00			0.00			0.00			0.00

Total distributions		0.00			(0.01	)		0.00			0.00			0.00			0.00

Net asset value, end of year	$	9.11		$	7.10		$	10.41		$	11.91		$	9.48		$	9.10

Total return		28.31	%²		(31.73	)%²		(12.59	)%²		25.63	%²		(5.20	)%²		6.43	%^2,3

Ratios/Supplemental data:
Net assets (in millions), end of year	$	30.7		$	22.8		$	29.3		$	4.0		$	1.4		$	0.4

Ratio of operating expenses to average net assets		1.46	%⁶		1.29	%		1.52	%		2.84	%		8.65	%		1.55	%^4,6
Less: Reimbursement of expenses by Adviser		(0.36	)%		(0.19	)%		(0.42	)%		(1.74	)%		(7.55	)%		(0.46	)%⁴

Ratio of net operating expenses to average net assets		1.10	%		1.10	%		1.10	%		1.10	%		1.10	%		1.09	⁴

Ratio of net investment income (loss) to average net assets		0.56	%		0.53	%		0.22	%		0.20	%		(0.11	)%		(0.23	)%⁴

Portfolio turnover rate		53.52	%		48.19	%		23.12	%		25.60	%		35.74	%		53.52	%

¹ Based on average shares outstanding.

² The total returns would have been lower had certain expenses not been reduced during the period shown.

³ Not Annualized

⁴ Annualized

⁵ For the period August 31, 2016 (initial offering of R6 Shares) to December 31, 2016.

⁶ Interest expense rounds to less than 0.01%


See Notes to Financial Statements.		49


Baron Select Funds		December 31, 2016

FINANCIAL HIGHLIGHTS (Continued)

BARON GLOBAL ADVANTAGE FUND

Selected data for a share outstanding throughout each year:


	RETAIL SHARES
	Year Ended December 31,
	2016			2015			2014			2013			2012¹
Net asset value, beginning of year	$	13.91		$	14.20		$	13.51		$	10.41		$	10.00

Income (loss) from investment operations:
Net investment income (loss)		(0.18	)²		(0.11	)²		0.02	²		(0.02	)²		(0.02	)²
Net realized and unrealized gain (loss) on investments		0.02	¹⁰		(0.14	)		0.67			3.12			0.43

Total from investment operations		(0.16	)		(0.25	)		0.69			3.10			0.41

Less distributions to shareholders from:
Net investment income		0.00			(0.02	)		0.00			0.00			0.00
Net realized gain on investments		0.00			(0.02	)		(0.00	)³		0.00			0.00

Total distributions		0.00			(0.04	)		0.00			0.00			0.00

Net asset value, end of year	$	13.75		$	13.91		$	14.20		$	13.51		$	10.41

Total return		(1.15	)%⁴		(1.72	)%⁴		5.11	%^4,5		29.78	%⁴		4.10	%^4,6

Ratios/Supplemental data:
Net assets (in millions), end of year	$	5.0		$	6.2		$	3.9		$	2.3		$	1.5

Ratio of operating expenses to average net assets		3.86	%		3.19	%		3.61	%		5.51	%		8.35	%^7,8
Less: Reimbursement of expenses by Adviser		(2.36	)%		(1.69	)%		(2.11	)%		(4.01	)%		(6.85	)%^7,8

Ratio of net operating expenses to average net assets		1.50	%		1.50	%		1.50	%		1.50	%		1.50	%^7,8

Ratio of net investment income (loss) to average net assets		(1.30	)%		(0.75	)%		0.18	%		(0.20	)%		(0.38	)%^7,8

Portfolio turnover rate		21.48	%		25.88	%		123.51	%		32.78	%		24.64	%⁶

	INSTITUTIONAL SHARES															R6 SHARES
	Year Ended December 31,															Year Ended December 31,
	2016			2015			2014			2013			2012¹			2016⁹
Net asset value, beginning of year	$	14.00		$	14.28		$	13.56		$	10.42		$	10.00		$	14.37

Income (loss) from investment operations:
Net investment income (loss)		(0.14	)²		(0.07	)²		0.07	²		0.00	^2,3		(0.02	)²		(0.07	)²
Net realized and unrealized gain (loss) on investments		0.01	¹⁰		(0.15	)		0.65			3.14			0.44			(0.43	)

Total from investment operations		(0.13	)		(0.22	)		0.72			3.14			0.42			(0.50	)

Less distributions to shareholders from:
Net investment income		0.00			(0.04	)		0.00			0.00			0.00			0.00
Net realized gain on investments		0.00			(0.02	)		(0.00	)³		0.00			0.00			0.00

Total distributions		0.00			(0.06	)		0.00			0.00			0.00			0.00

Net asset value, end of year	$	13.87		$	14.00		$	14.28		$	13.56		$	10.42		$	13.87

Total return		(0.93	)%⁴		(1.51	)%⁴		5.32	%^4,5		30.13	%⁴		4.20	%^4,6		(3.48	)%^4,6

Ratios/Supplemental data:
Net assets (in millions), end of year	$	4.6		$	5.3		$	4.1		$	3.3		$	1.6		$	0.1

Ratio of operating expenses to average net assets		3.55	%		2.89	%		2.92	%		4.91	%		7.33	%^7,8		4.11	%⁸
Less: Reimbursement of expenses by Adviser		(2.30	)%		(1.64	)%		(1.67	)%		(3.66	)%		(6.08	)%^7,8		(2.87	)%⁸

Ratio of net operating expenses to average net assets		1.25	%		1.25	%		1.25	%		1.25	%		1.25	%^7,8		1.24	%⁸

Ratio of net investment income (loss) to average net assets		(1.06	)%		(0.47	)%		0.48	%		0.02	%		(0.30	)%^7,8		(1.52	)%⁸

Portfolio turnover rate		21.48	%		25.88	%		123.51	%		32.78	%		24.64	%⁶		21.48	%

¹ For the period April 30, 2012 (commencement of operations) to December 31, 2012.

² Based on average shares outstanding.

³ Less than $0.01 per share.

⁴ The total returns would have been lower had certain expenses not been reduced during the period shown.

⁵ The Adviser made a voluntary payment to the Fund in the amount of $47,291 to compensate the Fund for a loss incurred due to shareholder activity processing error. The impact of this payment increased the Fund’s total return by 0.54%.

⁶ Not Annualized.

⁷ Certain fixed expenses incurred by the Fund were not annualized for the period ended December 31, 2012.

⁸ Annualized.

⁹ For the period August 31, 2016 (initial offering of R6 Shares) to December 31, 2016.

¹⁰ The amount shown for a share outstanding does not correspond with the aggregate realized and unrealized gain (loss) on investments for the period due to the timing of sales and redemptions of Fund shares in relation to fluctuating market values of investments of the Fund.


50		See Notes to Financial Statements.


December 31, 2016		Baron Select Funds

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Trustees of Baron Select Funds and Shareholders of

Baron Partners Fund, Baron Focused Growth Fund, Baron International Growth Fund, Baron Real Estate Fund,

Baron Emerging Markets Fund, Baron Energy and Resources Fund and Baron Global Advantage Fund

In our opinion, the accompanying statements of assets and liabilities, including the statements of net assets, and the related statements of operations, of changes in net assets and with respect to the Baron Partners Fund of cash flows and the financial highlights present fairly, in all material respects, the financial position of Baron Partners Fund, Baron Focused Growth Fund, Baron International Growth Fund, Baron Real Estate Fund, Baron Emerging Markets Fund, Baron Energy and Resources Fund and Baron Global Advantage Fund (seven portfolios constituting the Baron Select Funds, hereafter referred to as the “Funds”) as of December 31, 2016, the results of each of their operations, with respect to the Baron Partners Fund its cash flows for the year then ended, the changes in each of their net assets for each of the two years in the period then ended, and the financial highlights for each of the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Funds ’ management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities as of December 31, 2016 by correspondence with the custodian, brokers, and portfolio companies, provide a reasonable basis for our opinion.

LOGO

PricewaterhouseCoopers LLP

New York, NY

February 24, 2017


Baron Select Funds		December 31, 2016

TAX INFORMATION (Unaudited)

The federal tax status of distributions paid by the Funds during the year ended December 31, 2016 are listed below.

During the fiscal year ended December 31, 2016, the Funds’ distributions to shareholders included:


Fund	Ordinary Income^1,3		Long-Term Capital Gains^2.3		Return of Capital

Baron Partners Fund	$	—	$	—	$	—

Baron Focused Growth Fund		—		10,001,809		—

Baron International Growth Fund		43,909		703,025		—

Baron Real Estate Fund		—		3,756,561		1,500,609

Baron Emerging Markets Fund		7,977,500		—		—

Baron Energy and Resources Fund		—		—		—

Baron Global Advantage Fund		—		—		—

¹	For tax purposes, short-term capital gains are considered ordinary income distributions.

²	Long-term capital gains are subject to a maximum allowable rate of 20% for individuals pursuant to the American Taxpayer Relief Act of 2012.

³	Under the Patient Protection and Affordable Care Act, higher income taxpayers must pay a 3.8% additional tax on net investment income.

Of the total ordinary income distributions paid by Baron International Growth Fund and Baron Emerging Markets Fund, 99.19% and 100.00%, respectively, is qualified dividend income subject to a reduced tax rate. Of the total ordinary income distributions paid by Baron International Growth Fund and Baron Emerging Markets Fund, 5.28% and 0.16%, respectively, qualifies for the corporate dividends received deduction.

The information and distributions reported may differ from the information and distributions taxable to the shareholders for the calendar year ended December 31, 2016. The information necessary to complete your income tax return for the calendar year ended December 31, 2016 will be listed on the Form 1099-DIV, which was mailed to you in January/February 2017.


December 31, 2016		Baron Select Funds

FUND EXPENSES (Unaudited)

As a shareholder of the Funds, you may incur two types of costs: ongoing expenses and transaction costs. Ongoing expenses include advisory fees, distribution and service (12b-1) fees and other Fund expenses. Due to the payment of Rule 12b-1 fees, long-term shareholders may indirectly pay more than the maximum permitted front-end sales charge. The information on this page is intended to help you understand your ongoing costs of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.

The information in the following table is based on an investment of $1,000 invested on July 1, 2016 and held for the six months ended December 31, 2016.

ACTUAL EXPENSES

The table below titled “Based on Actual Total Return” provides information about actual account values and actual expenses. You may use the information provided in this table, together with the amount you invested, to estimate the expenses that you paid over the period. To estimate the expenses you paid on your account, divide your ending account value by $1,000 (for example, an $8,600 ending account value divided by $1,000 = 8.6), then multiply the result by the number under the heading titled “Expenses Paid During the Period”.

BASED ON ACTUAL TOTAL RETURN FOR THE SIX MONTHS ENDED DECEMBER 31, 2016¹


	Actual Total Return			Beginning Account Value July 1, 2016		Ending Account Value December 31, 2016			Annualized Expense Ratio			Expenses Paid During the Period³
Baron Partners Fund — Retail Shares		3.64	%	$	1,000.00	$	1,036.40			1.83	%²	$	9.37
Baron Partners Fund — Institutional Shares		3.74	%	$	1,000.00	$	1,037.40			1.57	%²	$	8.04
Baron Partners Fund — R6 Shares⁶		(2.33	)%	$	1,000.00	$	976.70			1.62	%²	$	5.34
Baron Focused Growth Fund — Retail Shares		0.29	%	$	1,000.00	$	1,002.90	⁴		1.35	%⁵	$	6.80
Baron Focused Growth Fund — Institutional Shares		0.44	%	$	1,000.00	$	1,004.40	⁴		1.10	%⁵	$	5.54
Baron Focused Growth Fund — R6 Shares⁶		(3.55	)%	$	1,000.00	$	964.50	⁴		1.10	%⁵	$	3.60
Baron International Growth Fund — Retail Shares		0.92	%	$	1,000.00	$	1,009.20	⁴		1.50	%⁵	$	7.58
Baron International Growth Fund — Institutional Shares		0.97	%	$	1,000.00	$	1,009.70	⁴		1.25	%⁵	$	6.31
Baron International Growth Fund — R6 Shares⁶		(3.83	)%	$	1,000.00	$	961.70	⁴		1.24	%⁵	$	4.05
Baron Real Estate Fund — Retail Shares		2.17	%	$	1,000.00	$	1,021.70			1.32	%	$	6.71
Baron Real Estate Fund — Institutional Shares		2.30	%	$	1,000.00	$	1,023.00			1.06	%	$	5.39
Baron Real Estate Fund — R6 Shares		2.31	%	$	1.000.00	$	1,023.10			1.07	%	$	5.44
Baron Emerging Markets Fund — Retail Shares		(1.65	)%	$	1,000.00	$	983.50			1.38	%	$	6.88
Baron Emerging Markets Fund — Institutional Shares		(1.50	)%	$	1,000.00	$	985.00			1.12	%	$	5.59
Baron Emerging Markets Fund — R6 Shares		(1.50	)%	$	1,000.00	$	985.00			1.14	%	$	5.69
Baron Energy & Resources Fund — Retail Shares		13.92	%	$	1,000.00	$	1,139.20	⁴		1.35	%⁵	$	7.26
Baron Energy & Resources Fund — Institutional Shares		14.02	%	$	1,000.00	$	1,140.20	⁴		1.10	%⁵	$	5.92
Baron Energy & Resources Fund — R6 Shares⁶		6.43	%	$	1,000.00	$	1,064.30	⁴		1.09	%⁵	$	3.75
Baron Global Advantage Fund — Retail Shares		3.00	%	$	1,000.00	$	1,030.00	⁴		1.50	%⁵	$	7.65
Baron Global Advantage Fund — Institutional Shares		3.12	%	$	1,000.00	$	1,031.20	⁴		1.25	%⁵	$	6.38
Baron Global Advantage Fund — R6 Shares⁶		(3.48	)%	$	1,000.00	$	965.20	⁴		1.24	%⁵	$	4.06

¹	Assumes reinvestment of all dividends and capital gain distributions, if any.

²	Annualized expense ratio for Baron Partners Fund for the six months ended December 31, 2016, includes 1.34%, 1.08% and 1.09% for net operating expenses and 0.49%, 0.49% and 0.53% for interest expense for the Retail, Institutional and R6 Shares, respectively.

³	Expenses are equal to each Share Class’ respective annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half-year, then divided by 366.

⁴	Ending account value assumes the return earned after waiver and would have been lower if a portion of the expenses had not been waived.

⁵	Annualized expense ratios are adjusted to reflect fee waiver.

⁶	For the period August 31, 2016 (initial offering of R6 Shares) to December 31, 2016.


Baron Select Funds		December 31, 2016

FUND EXPENSES (Unaudited) (Continued)

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The table below titled “Based on Hypothetical Total Return” provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Funds’ actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account values and expenses you paid for the period. You may use the information provided in this table to compare the ongoing costs of investing in the Funds and other funds. To do so, compare the 5% hypothetical example relating to the Funds with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that expenses shown in the table below are meant to highlight your ongoing costs and do not reflect any transactional costs, such as redemption fees, if any. Therefore, the table is useful in comparing ongoing costs only and will not help you determine your relative total costs of owning different mutual funds. In addition, if these transactional costs were included, your costs would have been higher.

BASED ON HYPOTHETICAL TOTAL RETURN FOR THE SIX MONTHS ENDED DECEMBER 31, 2016¹


	Hypothetical Annualized Total Return			Beginning Account Value July 1, 2016		Ending Account Value December 31, 2016			Annualized Expense Ratio			Expenses Paid During the Period³
Baron Partners Fund — Retail Shares		5.00	%	$	1,000.00	$	1,015.94			1.83	%²	$	9.27
Baron Partners Fund — Institutional Shares		5.00	%	$	1,000.00	$	1,017.24			1.57	%²	$	7.96
Baron Partners Fund — R6 Shares⁶		5.00	%	$	1,000.00	$	1,011.27			1.62	%²	$	5.43
Baron Focused Growth Fund — Retail Shares		5.00	%	$	1,000.00	$	1,018.35	⁴		1.35	%⁵	$	6.85
Baron Focused Growth Fund — Institutional Shares		5.00	%	$	1,000.00	$	1,019.61	⁴		1.10	%⁵	$	5.58
Baron Focused Growth Fund — R6 Shares⁶		5.00	%	$	1,000.00	$	1,013.00	⁴		1.10	%⁵	$	3.69
Baron International Growth Fund — Retail Shares		5.00	%	$	1,000.00	$	1,017.60	⁴		1.50	%⁵	$	7.61
Baron International Growth Fund — Institutional Shares		5.00	%	$	1,000.00	$	1,018.85	⁴		1.25	%⁵	$	6.34
Baron International Growth Fund — R6 Shares⁶		5.00	%	$	1,000.00	$	1,012.53	⁴		1.24	%⁵	$	4.16
Baron Real Estate Fund — Retail Shares		5.00	%	$	1,000.00	$	1,018.50			1.32	%	$	6.70
Baron Real Estate Fund — Institutional Shares		5.00	%	$	1,000.00	$	1,019.81			1.06	%	$	5.38
Baron Real Estate Fund — R6 Shares		5.00	%	$	1,000.00	$	1,019.76			1.07	%	$	5.43
Baron Emerging Markets Fund — Retail Shares		5.00	%	$	1,000.00	$	1,018.20			1.38	%	$	7.00
Baron Emerging Markets Fund — Institutional Shares		5.00	%	$	1,000.00	$	1,019.51			1.12	%	$	5.69
Baron Emerging Markets Fund — R6 Shares		5.00	%	$	1,000.00	$	1,019.41			1.14	%	$	5.79
Baron Energy & Resources Fund — Retail Shares		5.00	%	$	1,000.00	$	1,018.35	⁴		1.35	%⁵	$	6.85
Baron Energy & Resources Fund — Institutional Shares		5.00	%	$	1,000.00	$	1,019.61	⁴		1.10	%⁵	$	5.58
Baron Energy & Resources Fund — R6 Shares⁶		5.00	%	$	1,000.00	$	1,013.03	⁴		1.09	%⁵	$	3.66
Baron Global Advantage Fund — Retail Shares		5.00	%	$	1,000.00	$	1,017.60	⁴		1.50	%⁵	$	7.61
Baron Global Advantage Fund — Institutional Shares		5.00	%	$	1,000.00	$	1,018.85	⁴		1.25	%⁵	$	6.34
Baron Global Advantage Fund — R6 Shares⁶		5.00	%	$	1,000.00	$	1,012.53	⁴		1.24	%⁵	$	4.16

¹	Assumes reinvestment of all dividends and capital gain distributions, if any.

²	Annualized expense ratio for Baron Partners Fund for the six months ended December 31, 2016, includes 1.34%, 1.08% and 1.09% for net operating expenses and 0.49%, 0.49% and 0.53% for interest expense for the Retail, Institutional and R6 Shares, respectively.

³	Expenses are equal to each Share Class’ respective annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half-year, then divided by 366.

⁴	Ending account value assumes the return earned after waiver and would have been lower if a portion of the expenses had not been waived.

⁵	Annualized expense ratios are adjusted to reflect fee waiver.

⁶	For the period August 31, 2016 (initial offering of R6 Shares) to December 31, 2016.


December 31, 2016		Baron Select Funds

MANAGEMENT OF THE FUNDS (Unaudited)

Board of Trustees and Executive Officers.

Trustees of the Trust, together with information as to their positions with the Trust, principal occupations and other board memberships and affiliations for the past five years, are shown below. Each Trustee serves as Trustee of a Fund until its termination; until the Trustee’s retirement, resignation or death; or as otherwise specified in the Trust’s organizational documents. Unless otherwise noted, the address of each Executive Officer and Trustee is Baron Select Funds, 767 Fifth Avenue, 49th Floor, New York, NY 10153. ”Interested Trustees” are considered “interested persons” (as defined in the 1940 Act) of the Trust, and “Independent Trustees” are not considered “interested persons” (as defined in the 1940 Act). Additional information about the Trustees and Executive Officers of the Trust can be found in the Trust’s Statement of Additional Information (the “SAI”) which may be obtained without charge by writing or calling 1-800-99BARON. The SAI is also available on the Baron Funds^® website, www.BaronFunds.com.


Name, Address & Age	Position(s) Held With the Funds	Term of Office and Length of Time Served	Principal Occupation(s) During the Past Five Years	Number of Portfolios in Fund Complex Overseen by Trustee	Other Directorships Held by Trustee
Interested Trustees

Ronald Baron^(1),(2) 767 Fifth Avenue New York, NY 10153 Age: 73	Chief Executive Officer, Chief Investment Officer, Trustee and Portfolio Manager	13 years	Director, Chairman, CEO and CIO: the Firm* (1982-Present); Trustee: Baron Investment Funds Trust (1987-Present); Trustee: Baron Select Funds (2003-Present); Portfolio Manager: Baron USA Partners Fund, Ltd. (2003-Present).	13	None

Linda S. Martinson^(1),(2) 767 Fifth Avenue New York, NY 10153 Age: 61	Chairman, President, Chief Operating Officer and Trustee	13 years	Director: the Firm* (2003-Present); Secretary: the Firm* (1997-2008); President: the Firm* (2007-Present); Chief Operating Officer: the Firm (2006-present); Chairman (2010-Present), President (2007-Present), Trustee (1987-Present): Baron Investment Funds Trust; Chairman (2010-Present), President (2007-Present), Trustee (2003-Present): Baron Select Funds; Director: Baron USA Partners Fund, Ltd. (2006-Present); Director: Baron Managed Funds plc (2005-2009).	13	None
Independent Trustees

Norman S. Edelcup^(3),(4),(5) 244 Atlantic Isles, Sunny Isles Beach, FL 33160 Age: 81	Trustee	13 years	Mayor (2003-2015): Sunny Isles Beach, Florida; Trustee: Baron Investment Funds Trust (1987-Present), Baron Select Funds (2003-Present).	13	Director: CompX International, Inc. (diversified manufacturer of engineered components) (2006-2016); Director: Valhi, Inc. (diversified company) (1975-2016).

Harold W. Milner^(4),(5) 2293 Morningstar Drive Park City, UT 84060 Age: 82	Trustee	13 years	Trustee: Baron Investment Funds Trust (1987-Present), Baron Select Funds (2003-Present).	13	None

Raymond Noveck^(3),(4),(5) 31 Karen Road Waban, MA 02468 Age: 73	Lead Trustee	13 years	Private Investor (1999-Present); Trustee: Baron Investment Funds Trust (1987-Present), Baron Select Funds (2003-Present).	13	None

Anita Rosenberg^(4),(5) 1540 N. Lake Shore Drive Chicago, Il 60610 Age: 52	Trustee	3 years	Advisory Board Member: Impala Capital Management, LLC (2014-Present); Advisory Board Member: ValueAct Capital, LLC (2014-Present); Senior Advisor: Magnetar Capital (2011-2012); Trustee: Baron Investment Funds Trust, Baron Select Funds (2013-Present).	13	Director: Golub Capital BDC, Inc. (2011-Present).

David A. Silverman, MD^(4),(5) 146 Central Park West New York, NY 10024 Age: 66	Trustee	13 years	Physician and Faculty: New York University School of Medicine (1976-Present); Trustee: Baron Investment Funds Trust (1987-Present), Baron Select Funds (2003-Present).	13	None


Baron Select Funds		December 31, 2016

MANAGEMENT OF THE FUNDS (Unaudited) (Continued)


Name, Address & Age	Position(s) Held With the Funds	Term of Office and Length of Time Served	Principal Occupation(s) During the Past Five Years	Number of Portfolios in Fund Complex Overseen by Trustee	Other Directorships Held by Trustee
Independent Trustees (continued)

Alex Yemenidjian^(4),(5) 3801 Las Vegas Blvd. South Las Vegas, NV 89109 Age: 61	Trustee	10 years	Chairman and CEO: Tropicana Las Vegas (gaming) (2009-2015); Chairman and CEO: Armenco Holdings, LLC (investment company) (2005-Present); Managing Partner: Armenco Capital LLC (investment company) (2013-Present); Trustee: Baron Investment Funds Trust (2006-Present), Baron Select Funds (2006-Present).	13	Director: Guess?, Inc. (2005-Present); Director: Regal Entertainment Group (2005-Present).
Additional Officers of the Funds

Clifford Greenberg 767 Fifth Avenue New York, NY 10153 Age: 57	Senior Vice President	13 years	Director and Senior Vice President: the Firm*; Senior Vice President: Baron Investment Funds Trust, Baron Select Funds; Portfolio Manager: Baron Small Cap Fund.	N/A	N/A

Louis Beasley 767 Fifth Avenue New York, NY 10153 Age: 45	Vice President and Chief Compliance Officer	2 years	Chief Compliance Officer: Baron Capital Group, Inc., BAMCO, Inc., Baron Capital Management Inc., Baron Investment Funds Trust, Baron Select Funds, Baron USA Partners Fund, Ltd (2014-Present); Vice President: the Firm* (2014-Present); Principal and Director of Investment Management Compliance and Risk Management: Bessemer Trust (2006-2014).	N/A	N/A

Patrick M. Patalino 767 Fifth Avenue New York, NY 10153 Age: 48	Vice President, General Counsel and Secretary	9 years	Vice President, General Counsel and Secretary: the Firm*, Baron Investment Funds Trust, Baron Select Funds; General Counsel: Baron USA Partners Fund, Ltd.	N/A	N/A

Andrew Peck 767 Fifth Avenue New York, NY 10153 Age: 47	Senior Vice President	13 years	Senior Vice President: the Firm*, Baron Investment Funds Trust, Baron Select Funds; Portfolio Manager: Baron Asset Fund.	N/A	N/A

Susan Robbins 767 Fifth Avenue New York, NY 10153 Age: 62	Vice President	13 years	Director and Vice President: the Firm*; Vice President: Baron Investment Funds Trust, Baron Select Funds.	N/A	N/A

Peggy C. Wong 767 Fifth Avenue New York, NY 10153 Age: 55	Treasurer and Chief Financial Officer	13 years	Chief Financial Officer and Treasurer: the Firm*, Baron Investment Funds Trust, Baron Select Funds.	N/A	N/A

*	The “Firm” means BCG along with its subsidiaries BCI, Baron Capital Management, Inc. and the Adviser.

⁽¹⁾	Trustees deemed to be “Interested Trustees” by reason of their employment with the Adviser and BCI.

⁽²⁾	Members of the Executive Committee, which is empowered to exercise all of the powers, including the power to declare dividends, of the full Board when the full Board is not in session.

⁽³⁾	Members of the Audit Committee.

⁽⁴⁾	Members of the Nominating Committee.

⁽⁵⁾	Members of the Independent Committee.

Privacy Notice

The Funds collect nonpublic personal information about you from the following sources:

∎

Information we receive from you on applications or other forms;

∎

Information about your transactions with us, our Adviser or others; and

∎

Information we receive from third parties, such as credit reporting agencies.

“Nonpublic personal information” is private information about you that we obtain in connection with providing a financial product or service to you.

We may share your name and address with other Baron Funds and the Adviser and its affiliates for the purpose of sending you information about our products that we believe may be of interest to you and informing you of our upcoming Baron Investment Conference and for sending required information.

We do not disclose any nonpublic personal information about our customers to anyone, except as permitted or required by law. Examples of permitted disclosures under the law include sharing with companies that work for us to provide you services, such as the Transfer Agent or mailing house. All such companies that act on our behalf are contractually obligated to keep the information that we provide to them confidential and to use the information only to provide the services that we have asked them to perform for you and us.

We restrict access to nonpublic information about you to those employees who need to know that information to provide products or services to you. We maintain physical, electronic and procedural safeguards to guard your nonpublic personal information.

This privacy notice is also available at all times on the Baron Funds^® website, www.BaronFunds.com or by calling 1-800-99BARON.

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LOGO

767 Fifth Avenue, 49^th Fl.

New York, NY 10153

1.800.99.BARON

212-583-2000

www.BaronFunds.com

LOGO

DECEMBER 31

Item 2. Code of Ethics.

The Registrant has adopted a Code of Ethics for Principal Executive and Senior Financial Officers (the “Code”). Upon request, the Registrant will provide a copy of the Code to any person without charge. To obtain a copy of the Code, please send your request to info@Baronfunds.com or call 1-800-99BARON (1-800-992-2766).

Item 3. Audit Committee Financial Expert.

The Registrant’s Board of Trustees has determined that the Registrant has two audit committee financial experts serving on its Audit Committee, Norman S. Edelcup and Raymond Noveck. Both Mr. Edelcup and Mr. Noveck are “independent” for purposes of Item 3(a)(2) of Form N-CSR.

Item 4. Principal Accountant Fees and Services.

The following table shows the fees paid to PricewaterhouseCoopers, LLP, the Registrant’s principal accounting firm during the fiscal years ended December 31, 2016 and December 31, 2015:

(a) Audit Fees: for professional services rendered for the audit of the Registrant’s annual financial statements or services that are normally provided in connection with statutory and regulatory filings or engagements:


	2016		2015
Baron Select Funds	$	249,450	$	225,825

(b) Audit-Related Fees: for assurance and related services that are reasonably related to the performance of the audit and are not included as Audit Fees:


	2016		2015
Baron Select Funds	$	0	$	0


	2016		2015
Baron Select Funds	$	178,350	$	161,930

The Tax Fees represent services provided in connection with the preparation of tax returns and year-end distribution review.

(d) All Other Fees: for products and services provided by such accounting firm that are not included in (a), (b) or (c) above:


	2016		2015
Baron Select Funds	$	0	$	0

(e) Audit Committee Pre-Approval Policies and Procedures: (i) Pursuant to paragraph (c)(7) of Rule 2-01 of Regulation S-X and to its charter, the Audit Committee shall pre-approve all audit and non-audit services provided by the independent auditors and in connection therewith to review and evaluate the qualifications, independence and performance of the Fund’s independent auditors; (ii) 100% of the services described in each of items 4(b) through 4(d) were approved by the Audit Committee pursuant to paragraph (c)(7)(i)(C) of
Rule 2-01 of Regulation S-X.

(f) Not Applicable.

(g) The aggregate non-audit fees billed by the registrant’s accountant for services rendered to the registrant, and rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity

controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for the last two fiscal years is as follows:

2016: $25,000

2015: $66,300

(h) Not Applicable.

Item 5. Audit Committee of Listed Registrants.

The Registrant has a separately-designated standing Audit Committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934. The members of the Audit Committee are Norman S. Edelcup and Raymond Noveck.

Item 6. Schedule of Investments.

Included herein under Item 1.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable.

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable.

Item 10. Submission of Matters to a Vote of Security Holders.

Not applicable.

Item 11. Controls and Procedures.

(a) The Registrant’s principal executive officer and principal financial officer have concluded that the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “1940 Act”)) are effective based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this report.

(b) There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the Registrant’s second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

Item 12. Exhibits.

(a) (2) Certification of each of the principal executive officers and principal financial officers of the Registrant as required by Rule 30a-2 under the Act (17 CFR 270.30a-2) is attached hereto as a part of EX-99.CERT.

(b) Certification of each of the principal executive officers and principal financial officers of the Registrant as required by Section 906 of the Sarbanes-Oxley Act of 2002 is attached hereto as a part of EX-99.906CERT.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


BARON SELECT FUNDS

By:		/s/ Ronald Baron
		Ronald Baron
		Chief Executive Officer

Date:		March 3, 2017

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.


By:		/s/ Ronald Baron
		Ronald Baron
		Chief Executive Officer

Date:		March 3, 2017

By:		/s/ Peggy Wong
		Peggy Wong
		Treasurer and Chief Financial Officer

Date:		March 3, 2017

Baron Partners Fund (BPTRX) N-CSRCertified annual shareholder report (management investment company)