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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-3790
Pear Tree Funds
(Exact name of registrant as specified in charter)
55 Old Bedford Road, Lincoln, MA 01773
(Address of principal executive offices)
Willard L. Umphrey
Pear Tree Advisors, Inc.
55 Old Bedford Road, Lincoln, MA 01773
(Name and address of agent for service)
Registrant’s telephone number, including area code: (781) 676-5900
Date of fiscal year end: March 31
Date of reporting period: April 1, 2013 through March 31, 2014
ITEM 1. REPORTS TO SHAREOWNERS.
PEAR TREE FUNDS
Pear Tree Columbia Small Cap Fund
Pear Tree Quality Fund
Pear Tree PanAgora Dynamic Emerging Markets Fund
Pear Tree PanAgora Risk Parity Emerging Markets Fund
Pear Tree Polaris Foreign Value Fund
Pear Tree Polaris Foreign Value Small Cap Fund
ANNUAL REPORT
March 31, 2014
TABLE OF CONTENTS
| President’s Letter | 1 |
| Fund Expenses | 2 |
| Portfolio Manager Commentaries | 4 |
| Pear Tree Columbia Small Cap Fund | 4 |
| Pear Tree Quality Fund | 6 |
| Pear Tree PanAgora Dynamic Emerging Markets Fund | 8 |
| Pear Tree PanAgora Risk Parity Emerging Markets Fund | 10 |
| Pear Tree Polaris Foreign Value Fund | 12 |
| Pear Tree Polaris Foreign Value Small Cap Fund | 16 |
| Schedules of Investments | 20 |
| Pear Tree Columbia Small Cap Fund | 20 |
| Pear Tree Quality Fund | 25 |
| Pear Tree PanAgora Dynamic Emerging Markets Fund | 30 |
| Pear Tree PanAgora Risk Parity Emerging Markets Fund | 39 |
| Pear Tree Polaris Foreign Value Fund | 57 |
| Pear Tree Polaris Foreign Value Small Cap Fund | 60 |
| Statements of Assets and Liabilities | 64 |
| Statements of Operations | 68 |
| Statements of Changes in Net Assets | 70 |
| Financial Highlights | 76 |
| Notes to Financial Statements | 88 |
| Report of Independent Registered Public Accounting Firm | 107 |
| Information for Shareholders | 108 |
| Management Contract and Advisory Contract Approval | 109 |
| Privacy Notice | 111 |
| Trustees and Officers | 114 |
| Service Providers | inside back cover |
This report must be preceded or accompanied by a current Pear Tree Funds prospectus for individuals who are not current shareholders of the Funds. If you are not a shareholder of a Pear Tree Fund, you should read the prospectus carefully before investing because it contains more complete information on the Pear Tree Funds’ investment objectives, risks, charges and expenses. Please consider this information carefully. For a prospectus and other information, visit www.peartreefunds.com or call (800) 326-2151.
NOT FDIC INSURED • MAY LOSE VALUE • NO BANK GUARANTEE
Neither Pear Tree Funds nor U.S. Boston Capital Corporation is a bank.
Dear Fellow Shareholder,
We are pleased to provide you with the Pear Tree Funds’ Annual Report for the twelve-month period ended March 31, 2014 and to update you on recent market conditions and the performance of the Pear Tree Funds.
For current performance information, please visit our website at www.peartreefunds.com. We thank you for your continued confidence in the Pear Tree Funds. Please feel free to e-mail us at feedback@peartreefunds.com or call us at 800-326-2151 with any questions or for assistance on your account.
Sincerely,
Willard Umphrey
President and Chairman
Any statements in this report regarding market or economic trends or the factors influencing the historical or future performance of the Pear Tree Funds are the views of the Funds’ Investment Manager and Sub-Advisers as of the date of this report. These views are subject to change at any time based upon market and other conditions, and Fund management and the subadvisors to the Funds disclaim any responsibility to update such views. These views may not be relied upon as investment advice or as an indication of trading intent on behalf of any Pear Tree Fund. Any references to specific securities are not recommendations of such securities and may not be representative of any Pear Tree Fund’s current or future investments.
Past performance is no guarantee of future results, and there is no guarantee that market forecasts will be realized.
PEAR TREE FUNDS
FUND EXPENSES
We believe it’s important for Fund shareholders to have a clear understanding of fund expenses and the impact expenses have on investment returns. The following is important information about each Fund’s Expense Example, which appears below.
Expense Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees, distribution (12b-1) fees (on Ordinary Shares) and other Fund expenses. The example is intended to help you understand your ongoing costs (in dollars) of investing in a Fund and to compare these costs with the ongoing costs of investing in other mutual funds. These examples are based on $1,000 being invested at the beginning of the period and held for the entire period from October 1, 2013 to March 31, 2014.
Actual Expenses
The first line for each Share Class for each Fund provides information about actual account returns and actual expenses. You may use the information in this line, together with the amount you invested for that Fund and Share Class, to estimate the expenses that you paid over the period. To estimate the expenses you paid over the period, simply divide your account value by $1,000, then multiply the result by the number under the heading “Expenses Paid During the Period.”
Hypothetical Example for Comparison Purposes
The second line for each Share Class for each Fund shows you hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return.
The hypothetical account values and hypothetical expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information only to compare the ongoing expenses of investing in the Fund with the ongoing expenses of other funds. To do so, compare the Fund’s 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.
Expense Example for the 6 months ended March 31, 2014
| Pear Tree Fund | Share Class | Total Return Description | Beginning Account Value 10/1/13 | Ending Account Value 3/31/2014 | Annualized Expense Ratio | Expenses Paid* 10/1/2013 – 3/31/2014 |
| Small Cap | Ordinary | Actual | $1,000.00 | $1,077.60 | 1.55% | $8.02 |
| Hypothetical | $1,000.00 | $1,017.21 | 1.55% | $7.78 | ||
| Institutional | Actual | $1,000.00 | $1,079.10 | 1.30% | $6.74 | |
| Hypothetical | $1,000.00 | $1,018.44 | 1.30% | $6.55 | ||
| Quality | Ordinary | Actual | $1,000.00 | $1,117.30 | 1.31% | $6.91 |
| Hypothetical | $1,000.00 | $1,018.40 | 1.31% | $6.59 | ||
| Institutional | Actual | $1,000.00 | $1,118.90 | 1.07% | $5.67 | |
| Hypothetical | $1,000.00 | $1,019.58 | 1.07% | $5.40 | ||
| Emerging Markets | Ordinary | Actual | $1,000.00 | $1,003.80 | 1.47% | $7.33 |
| Hypothetical | $1,000.00 | $1,017.62 | 1.47% | $7.38 | ||
| Institutional | Actual | $1,000.00 | $1,005.30 | 1.22% | $6.10 | |
| Hypothetical | $1,000.00 | $1,018.85 | 1.22% | $6.14 | ||
| Risk Parity | Ordinary | Actual | $1,000.00 | $1,003.70 | 2.10% | $10.50 |
| Emerging Markets | Hypothetical | $1,000.00 | $1,014.45 | 2.10% | $10.56 | |
| Institutional | Actual | $1,000.00 | $1,008.70 | 1.70% | $8.52 | |
| Hypothetical | $1,000.00 | $1,016.45 | 1.70% | $8.55 | ||
| Foreign Value | Ordinary | Actual | $1,000.00 | $1,138.60 | 1.53% | $8.18 |
| Hypothetical | $1,000.00 | $1,017.28 | 1.53% | $7.72 | ||
| Institutional | Actual | $1,000.00 | $1,140.70 | 1.28% | $6.83 | |
| Hypothetical | $1,000.00 | $1,018.55 | 1.28% | $6.44 | ||
| Foreign Value | Ordinary | Actual | $1,000.00 | $1,203.80 | 1.57% | $8.63 |
| Small Cap | Hypothetical | $1,000.00 | $1,017.10 | 1.57% | $7.90 | |
| Institutional | Actual | $1,000.00 | $1,205.10 | 1.32% | $7.27 | |
| Hypothetical | $1,000.00 | $1,018.34 | 1.32% | $6.66 |
* “Expenses Paid” for each Fund share class relating to actual or hypothetical returns, is the amount equal to the product of (a) that Fund’s and Share Class’ average account value for the six-month period ended March 31, 2014, multiplied by (b) the corresponding “Annualized Expense Ratio” multiplied by (c) the fraction 182/365 (which reflects the six-month period covered by this report).
PEAR TREE COLUMBIA SMALL CAP FUND
INVESTMENT PROFILE
All Data as of March 31, 2014
| Fund Information | ||
| Net Assets Under Management | $117.2 Million | |
| Number of Companies | 78 | |
| Price to Book Ratio | 4.0 | |
| Price to Earnings Ratio | 29.7 | |
| Ordinary | Institutional | |
| Total Expense Ratio (Gross)* | 1.80% | 1.55% |
| Total Expense Ratio (Net)* | 1.80% | 1.55% |
| Ticker Symbol | USBNX | QBNAX |
| * per prospectus dated August 1, 2013. See financial highlights for total expense ratios for the fiscal year ended March 31, 2014. | ||
Investment Commentary
For the annual period ended March 31, 2014 the Pear Tree Columbia Small Cap Fund’s Ordinary Shares (the “Fund”) underperformed its benchmark, the Russell 2000 Index. The Fund achieved a return of 22.76% at net asset value compared to 24.90% for the Index.
Market Conditions and Investment Strategies
It was a great year for equity markets and for small cap stocks in particular. Despite modest economic growth, stocks were the beneficiary of the Federal Reserve’s low interest rate policy which was a major catalyst for investors to seek higher yields and greater risk in the stock market.
Analyzing our relative performance for the year, our stock selection in the Consumer Staples, Materials and Information Technology sectors contributed to returns, while our selections in Financials, Health Care, Industrials and Consumer Discretionary detracted. In Consumer Staples, we outperformed due to the outstanding performance of Nu Skin Enterprises Inc., which direct sells personal care products globally, and gained over 87% for the period. Our second best performer was Alliance Data Systems Corp., which gained over 68% for the year. The company, which provides marketing and credit card solutions, continues to see strong demand for its services.
The Financials and Industrials sectors were among our weakest sectors. Our stock selection in Financials detracted from our relative return as Real Estate Invest Trust holdings American Campus Communities Inc. and Campus Crest Communities Inc. declined 17% and 35% respectively, when the education REIT group fell out of favor with investors. Our relative underperformance in Industrials was due primarily to Acacia Research Corp. which fell 49% for the period and detracted nearly 2% from our relative return. The company, which licenses intellectual property, failed to meet analyst estimates as proposed government regulations delayed settlements on pending patent cases.
Portfolio Changes
The Information Technology, Industrials, Health Care and Financials sectors increased during the year while the Consumer Discretionary, Consumer Staples and Materials sectors declined. Changes in other sectors were not material.
A Look Ahead
Despite the strong performance of the equity markets over the past year, we continue to find many attractive opportunities in the small cap landscape. We believe that our relative performance should improve in the coming quarters as the Fed’s stimulus is withdrawn and company fundamentals take precedence. We believe that our strategy of investing in high quality companies that have unique and growing businesses and strong managements will put us in a position to outperform the benchmark index.
The Fund is co-managed by Robert von Pentz, CFA, and Rhys Williams, CFA of Columbia Partners, L.L.C. Investment Management.
PEAR TREE COLUMBIA SMALL CAP FUND
Top 10 Holdings
| Percentage of total net assets | 29.2% |
| Alliance Data Systems Corporation | 4.7% |
| EPR Properties | 4.5% |
| Finisar Corporation | 2.8% |
| Proto Labs, Inc. | 2.6% |
| MasTec, Inc. | 2.6% |
| ICG Group, Inc. | 2.5% |
| Core Laboratories N.V. | 2.5% |
| Ferro Corporation | 2.4% |
| BioTelemetry, Inc. | 2.3% |
| IMAX Corporation | 2.3% |
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Sector Allocation
| Percentage of total net assets | 100.0% |
| Industrials | 20.0% |
| Information Technology | 18.3% |
| Consumer Discretionary | 17.7% |
| Financials | 15.8% |
| Health Care | 14.4% |
| Consumer Staples | 5.5% |
| Materials | 5.0% |
| Energy | 3.5% |
| Telecommunication Services | 0.0% |
| CASH + other assets (net) | –0.2% |
Value of a $10,000 Investment
Pear Tree Columbia Small Cap (PTSC) Ordinary Shares
vs. Russell 2000 Index
Average Annual Total Returns
| 1Q 2014 | Six Months | One Year | Five Year | Ten Year | Since Inception | Inception Date | |
| Ordinary Shares | –3.05% | 7.76% | 22.76% | 22.23% | 6.48% | 10.64% | 08/03/92 |
Institutional Shares1 | –3.00% | 7.91% | 23.12% | 22.56% | 6.84% | 10.02% | 01/06/93 |
Russell 20002 | 1.12% | 9.94% | 24.90% | 24.31% | 8.53% | 10.12% | ________ |
1 Institutional Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution fees.
2 The Russell 2000 Index is a market capitalization-weighted index of 2,000 small company stocks. It is widely recognized as representative of the general market for small company stocks. Index returns assume the reinvestment of dividends and, unlike Fund returns, do not reflect any fees or expenses. You cannot invest directly in an Index. The beginning date of the Index is 08/3/92.
Small company stocks may trade less frequently and in a limited volume, and their prices may fluctuate more than stocks of other companies. Small company stocks may therefore be more vulnerable to adverse developments than those of larger companies. The Fund may invest in issuers in the real estate industry. Changes in real estate values or economic downturns can have a significant negative effect on these issuers. The Fund may invest in foreign issuers that trade on U.S. stock exchanges. These issuers may be subject to special risks including different corporate governance rules and bankruptcy laws.
PEAR TREE QUALITY FUND
INVESTMENT PROFILE
All Data as of March 31, 2014
| Fund Information | ||
| Net Assets Under Management | $124.9 Million | |
| Number of Companies | 96 | |
| Price to Book Ratio | 4.0 | |
| Price to Earnings Ratio | 16.3 | |
| Ordinary | Institutional | |
| Total Expense Ratio (Gross)* | 1.62% | 1.35% |
| Total Expense Ratio (Net)** | 1.37% | 1.10% |
| Ticker Symbol | USBOX | QGIAX |
| ** per prospectus dated August 1, 2013. See financial highlights for total expense ratios for the fiscal year ended March 31, 2014. | ||
| ** Reflects all fee waivers currently in effect. Fee waivers may not be amended, rescinded or terminated before July 31, 2014 without the consent of the Fund’s board. | ||
Investment Commentary
For the annual period ended March 31, 2014, the Pear Tree Quality Fund’s Ordinary Shares (the “Fund”) underperformed its benchmark, S&P 500 (the “Index“). The Fund achieved a return of 15.40% at net asset value compared to 21.86% for the Index.
Market Conditions and Investment Strategies
The Fund’s investment manager currently chooses securities for the Fund by periodically selecting a mutual fund (the ”Target Portfolio“) and monitoring the Target Portfolio’s holdings. The Fund’s investment adviser, at the direction of the investment manager, rebalances the Fund’s portfolio to correspond to the Target Portfolio’s most recent holdings as publicly reported. From April 1, 2013 to March 31, 2014, the Fund’s Ordinary Shares, when compared to the Target Portfolio, had a tracking error of 0.25.
Over the previous twelve months, the Information Technology sector was the largest positive contributor to the Fund’s performance due to a large overweight position and positive stock selection. The Fund’s underweight positions in the Telecommunication, Utilities and Energy sectors also contributed to performance.
The greatest detractors from performance came from the Consumer Staples sector where a very large overweight position and stock selection negatively affected relative performance. Other detractors were stock selection in the Health Care and Consumer Discretionary sectors.
Portfolio Changes
We expect the Fund to have a relatively low turnover rate given the historical stability and relatively low turnover rate of the current Target Portfolio.
For the twelve month period ending March 31, 2014, the Fund rebalanced the holdings four times to replicate the publicly disclosed holdings of the current target portfolio. The four rebalances resulted in the sale of three positions. Also as a result of the rebalances, the Fund opened new positions in twenty-five companies; one Materials company, four Health Care companies, five Consumer Discretionary companies, seven Industrial companies and eight Information Technology companies.
A Look Ahead
For the foreseeable future, the Fund’s investment manager expects the Target Portfolio to remain the same. For more information on the selection of the Target Portfolio(s), please see the Fund’s Prospectus.
The Fund’s target portfolio is GMO Quality Fund III (GQETX) and the Fund is managed by Robert von Pentz, CFA of Columbia Partners, L.L.C. Investment Management.
PEAR TREE QUALITY FUND
Top 10 Holdings
| Percentage of total net assets | 44.9% |
| Microsoft Corporation | 5.9% |
| Google, Inc. | 5.6% |
| Johnson & Johnson | 5.5% |
| Oracle Corporation | 5.3% |
| Procter & Gamble Company | 4.1% |
| International Business Machines | 4.1% |
| Coca-Cola Company (The) | 4.1% |
| Chevron Corporation | 4.0% |
| Philip Morris International, Inc. | 3.4% |
| Wal-Mart Stores, Inc. | 2.9% |
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Sector Allocation
| Percentage of total net assets | 100.0% |
| Information Technology | 31.7% |
| Health Care | 27.8% |
| Consumer Staples | 24.6% |
| Energy | 7.0% |
| Consumer Discretionary | 4.1% |
| Industrials | 4.1% |
| Telecommunication Services | 0.2% |
| Materials | 0.1% |
| Financials | 0.0% |
| Utilities | 0.0% |
| CASH + other assets (net) | 0.4% |
Value of a $10,000 Investment
Pear Tree Quality (PTQ) Ordinary Shares vs.
S&P 500 Index
Average Annual Total Returns
| 1Q 2014 | Six Months | One Year | Five Year | Ten Year | Since Inception | Inception Date | |
| Ordinary Shares | 2.20% | 11.73% | 15.40% | 18.05% | 4.89% | 9.15% | 05/06/85 |
Institutional Shares1 | 2.27% | 11.89% | 15.74% | 18.48% | 5.17% | 7.81% | 03/25/91 |
S & P 5002 | 1.81% | 12.51% | 21.86% | 21.16% | 7.42% | 10.84% | ________ |
1 Institutional Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution fees.
2 The S&P 500 Index is an unmanaged index of stocks chosen to their size industry characteristics. It is widely recognized as representative of stocks in the United States. Index returns assume the reinvestment of dividends and, unlike Fund returns, do not reflect any fees or expenses. You cannot invest directly in the Index. The beginning date for the Index is 05/29/85.
* S&P 500 Index is the registered mark of Standard & Poor’s.
Investing in foreign markets can be more volatile than the U.S. market due to increased risks of adverse issuer, political, regulatory, market or economic developments and can perform differently than the U.S. market.
PEAR TREE PANAGORA DYNAMIC EMERGING MARKETS FUND
INVESTMENT PROFILE
All Data as of March 31, 2014
| Fund Information | ||
| Net Assets Under Management | $147.3 Million | |
| Number of Companies | 223 | |
| Price to Book Ratio | 1.4 | |
| Price to Earnings Ratio | 9.8 | |
| Ordinary | Institutional | |
| Total Expense Ratio (Gross)* | 1.92% | 1.65% |
| Total Expense Ratio (Net)* | 1.92% | 1.65% |
| Ticker Symbol | QFFOX | QEMAX |
| * per prospectus dated August 1, 2013. See financial highlights for total expense ratios for the fiscal year ended March 31, 2014. | ||
Investment Commentary
For the annual period ended March 31, 2014, the Pear Tree PanAgora Dynamic Emerging Markets Fund’s Ordinary Shares (the ”Fund“) underperformed its benchmark, The MSCI Emerging Markets Index (the Index”). The Fund achieved a return of –4.77% at net asset value compared to –1.07% for the Index.
Market Conditions and Investment Strategies
On a country basis, the largest detractors were India (–1.07%) and South Korea (–0.98%). Among holdings in India the largest detractor was overweight position Gitanjali Gems Ltd. while among holdings in South Korea the largest detractor was underweight position Naver Corp. The largest contributors were Mexico (+0.96%) and China (+0.59%). Among holdings in Mexico, the largest contributor was overweight position Gruma S.A.B. de C.V. while among holdings in China the largest contributor was underweight position Cencosud SA.
On a sector basis, the largest detractors were Information Technology (–1.11%) and Consumer Discretionary (–0.90%). Among holdings in Information Technology the largest detractor was underweight position Tencent Holdings, while among holdings in Consumer Discretionary the largest detractor was overweight position Gitanjali Gems Ltd.. The largest contributors were Consumer Staples (+0.92%) and Industrials (+0.47%). Among holdings in Consumer Staples the largest contributor was overweight position Gruma S.A.B. de C.V. while among holdings in Industrials the largest contributor was overweight position Teco Electric & Machinery Co.
For the annual period ending March 2014, our proprietary Dynamic Alpha model performed well — best-ranked alpha stocks outperformed the worst ranked alpha stocks. Our proprietary Valuation composite did not perform well — stocks with attractive valuations underperformed their more expensive peers. Our proprietary Quality composite performed well — stocks with strong business and management quality metrics outperformed lower quality peers. Our proprietary Momentum composite also performed well — stocks with positive market sentiment outperformed stocks with poor earnings momentum.
Portfolio Changes
The addition of the Risk Parity strategy was a significant portfolio change during the annual period ended March 31, 2014.
A Look Ahead
As a quantitative investment firm, we tend not to provide strategy-specific forward looking commentary. We believe that our systematic investment approach ensures that we deliver a portfolio of our highest conviction of ideas to all of our clients.
The Fund’s portfolio is managed by Dmitri Kantsyrev Ph.D., CFA and Jane Zhou, Ph.D of PanAgora Asset Management, Inc.
PEAR TREE PANAGORA DYNAMIC EMERGING MARKETS FUND
Top 10 Holdings3
| Percentage of total net assets | 37.9% |
Pear Tree PanAgora Risk Parity Emerging Markets | 22.4% |
| Samsung Electronics Company, Ltd. | 3.2% |
iShares MSCI Emerging Markets Index Fund | 3.1% |
Taiwan Semiconductor Manufacturing Co., Ltd. | 1.7% |
| China Construction Bank Corporation | 1.5% |
| China Mobile Limited | 1.3% |
| Sasol Ltd. | 1.3% |
| Bank of China Ltd. H | 1.2% |
| Tencent Holdings Limited | 1.1% |
| China Petroleum & Chemical Corporation | 1.1% |
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Sector Allocation3
| Percentage of total net assets | 100.0% |
| Financials | 19.4% |
| Information Technology | 13.4% |
| Energy | 8.9% |
| Consumer Discretionary | 7.9% |
| Materials | 5.7% |
| Industrials | 5.6% |
| Consumer Staples | 5.2% |
| Telecommunication Services | 4.5% |
| Utilities | 2.1% |
| Health Care | 1.3% |
| Mutual Funds | 25.5% |
| CASH + other assets (net) | 0.5% |
Top 10 Country Allocations3
| Percentage of total net assets | 66.1% |
| Taiwan | 11.0% |
| China | 10.4% |
| South Korea | 10.2% |
| Brazil | 8.1% |
| South Africa | 6.0% |
| Hong Kong | 5.5% |
| India | 4.9% |
| Russia | 4.0% |
| Malaysia | 3.1% |
| Mexico | 2.9% |
Value of a $10,000 Investment
Pear Tree PanAgora Dynamic Emerging Markets (PTEM)
Ordinary Shares vs. MSCI EM Index
Average Annual Total Returns
| 1Q 2014 | Six Months | One Year | Five Year | Ten Year | Since Inception | Inception Date | |
| Ordinary Shares | –0.32% | 0.38% | –4.77% | 14.39% | 8.47% | 5.89% | 09/30/94 |
Institutional Shares1 | –0.22% | 0.53% | –4.52% | 14.68% | 8.79% | 7.59% | 04/02/96 |
MSCI EM2 | –0.37% | 1.49% | –1.07% | 14.83% | 10.45% | 5.40% | ________ |
1 Institutional Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution fees.
2 The Morgan Stanley Capital International Emerging Markets (“MSCI EM”) Index is an unmanaged index comprised of stocks located in countries other than the United States. It is widely recognized as representative of the general market for emerging markets. Index returns assume the reinvestment of dividends and, unlike Fund returns, do not reflect fees or expenses. You cannot invest directly in an Index. The beginning date for the Index is 09/30/94.
3 “Top 10 Holdings”, “Sector Allocation”, and “Top 10 Country Allocation” reflect the direct and indirect (through the Fund’s investment in Pear Tree PanAgora Risk Parity Emerging Markets Fund) securities holdings.
Investing in foreign markets, particularly emerging markets, can be more volatile than the U.S. market due to increased risks of adverse issuer, political, regulatory, market or economic developments and can perform differently than the U.S. market.
PEAR TREE PANAGORA RISK PARITY EMERGING MARKETS FUND
INVESTMENT PROFILE
All Data as of March 31, 2014
| Fund Information | ||
| Net Assets Under Management | $33.7 Million | |
| Number of Companies | 566 | |
| Price to Book Ratio | 1.7 | |
| Price to Earnings Ratio | 16.0 | |
| Ordinary | Institutional | |
| Total Expense Ratio (Gross)* | 1.37% | 1.12% |
| Total Expense Ratio (Net)* | 1.37% | 1.12% |
| Ticker Symbol | RPEMX | EMPRX |
| * 2013 Initial Prospectus estimated expense ratio. See financial highlights for total expense ratios for the period ended March 31, 2014. | ||
Investment Commentary
The Pear Tree PanAgora Risk Parity Emerging Markets fund incepted on June 27, 2013. For the since inception period, June 27, 2014 to March 31, 2014, the Pear Tree PanAgora Risk Parity Emerging Markets Fund’s Ordinary Shares (the “Fund”) underperformed its benchmark, The MSCI Emerging Markets Index (the “Index”). The Fund achieved a return of 4.84% at net asset value compared to 9.94% for the Index.
Market Conditions and Investment Strategies
PanAgora’s proprietary Risk Parity portfolio construction approach is centered on the belief that diversification is the key to generating better risk-adjusted returns and that avoiding risk concentration is the best way to achieve true portfolio diversification. The Risk Parity Emerging Markets Equity strategy, therefore, seeks to achieve true diversification by balancing risk exposures at many levels. In an effort to mitigate risk concentration, Risk Parity is applied within countries to simultaneously balance risk across sector and stock exposures, and is then applied across countries so that each country contributes equally to risk at the aggregate portfolio level. The expected result is a more diversified, risk-balanced emerging markets equity portfolio that has lower volatility and more downside protection than a more concentrated approach, such as those based on capitalization-weighted indices, without sacrificing return potential.
At the country level, the top contributors to performance on an absolute basis were holdings in South Korea (1.16%) and China (0.89%). Positions held in Chile (–0.84%) and Indonesia (–0.57%) detracted. Sectors that contributed to absolute portfolio performance included Financials (1.03%) and Information Technology (1.03%). The Consumer Staples sector detracted from absolute portfolio performance (–0.13%).
Portfolio Changes
The Pear Tree PanAgora Risk Parity Emerging Markets fund incepted on June 27, 2013.
A Look Ahead
As a quantitative investment firm, we tend not to provide strategy-specific forward looking commentary. We believe that our systematic investment approach ensures that we deliver a portfolio of our highest conviction of ideas to all of our clients.
The Fund’s portfolio is managed by Edward Qian, Ph.D., CFA and Mark Barnes of PanAgora Asset Management, Inc.
PEAR TREE PANAGORA RISK PARITY EMERGING MARKETS FUND
Top 10 Holdings
| Percentage of total net assets | 12.4% |
| iPath MSCI India Index ETN | 5.0% |
| Vanguard FTSE Emerging Markets ETF | 2.4% |
Empresa Nacional de Telecomunicaciones S.A. | 0.7% |
| Almacees Exito S.A. | 0.7% |
| Jollibee Foods Corporation | 0.6% |
| IHH Healthcare Berhad | 0.6% |
| Isagen S.A. E.S.P. | 0.6% |
| Bankok Dusit Medical Services F | 0.6% |
| American Movil S.A.B. Series L | 0.6% |
| Ecopetrol S.A. | 0.6% |
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Sector Allocation
| Percentage of total net assets | 100.0% |
| Financials | 15.0% |
| Consumer Staples | 12.0% |
| Telecommunication Services | 11.8% |
| Materials | 10.6% |
| Consumer Discretionary | 9.7% |
| Industrials | 9.3% |
| Utilities | 8.7% |
| Energy | 8.2% |
| Mutual Funds | 7.4% |
| Health Care | 5.0% |
| Information Technology | 1.9% |
| Cash and Other Assets (Net) | 0.4% |
Top 10 Holdings
| Percentage of total net assets | 12.4% |
| iPath MSCI India Index ETN | 5.0% |
| Vanguard FTSE Emerging Markets ETF | 2.4% |
Empresa Nacional de Telecomunicaciones S.A. | 0.7% |
| Almacees Exito S.A. | 0.7% |
| Jollibee Foods Corporation | 0.6% |
| IHH Healthcare Berhad | 0.6% |
| Isagen S.A. E.S.P. | 0.6% |
| Bankok Dusit Medical Services F | 0.6% |
| American Movil S.A.B. Series L | 0.6% |
| Ecopetrol S.A. | 0.6% |
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Value of a $10,000 Investment
Pear Tree PanAgora Risk Parity Emerging Markets
(PTRP) Ordinary Shares vs. MSCI EM Index
Average Annual Total Returns
| 1Q 2014 | Six Months | One Year | Five Year | Ten Year | Since Inception | Inception Date | |
| Ordinary Shares | 0.78% | 4.84% | 6/27/2013 | ||||
Institutional Shares1 | 0.88% | 5.51% | 6/27/2013 | ||||
MSCI EM2 | –0.37% | 9.94% | ________ |
1 Institutional Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution fees.
2 The Morgan Stanley Capital International Emerging Markets (”MSCI EM“) Index is an unmanaged index comprised of stocks located in countries other than the United States. It is widely recognized as representative of the general market for emerging markets. Index returns assume the reinvestment of dividends and, unlike Fund returns, do not reflect fees or expenses. You cannot invest directly in an Index. The beginning date for the Index is 06/27/2013.
Investing in foreign markets, particularly emerging markets, can be more volatile than the U.S. market due to increased risks of adverse issuer, political, regulatory, market or economic developments and can perform differently than the U.S. market.
PEAR TREE POLARIS FOREIGN VALUE FUND
INVESTMENT PROFILE
All Data as of March 31, 2014
| Fund Information | ||
| Net Assets Under Management | $1,478.9 Million | |
| Number of Companies | 51 | |
| Price to Book Ratio | 1.9 | |
| Price to Earnings Ratio | 17.3 | |
| Ordinary | Institutional | |
| Total Expense Ratio (Gross)* | 1.59% | 1.33% |
| Total Expense Ratio (Net)* | 1.59% | 1.33% |
| Ticker Symbol | QFVOX | QFVIX |
| * per prospectus dated August 1, 2013. See financial highlights for total expense ratios for the fiscal year ended March 31, 2014. | ||
Investment Commentary
For the fiscal year period ended March 31, 2014, the Pear Tree Polaris Foreign Value Fund’s Ordinary Shares (the ”Fund“) outperformed its benchmark, the MSCI EAFE Index (the ”Index“). The Fund achieved a return of 23.28% at net asset value compared to 18.06% for the Index.
Market Conditions and Investment Strategies
The Fund’s outperformance is attributed to positive absolute results in nine of ten sectors, with top contributions from Consumer Discretionary, Materials and Consumer Staples. More than 75% of portfolio holdings posted double-digit returns for the fiscal year.
British homebuilders continued to top performance in the consumer discretionary sector, benefiting from rising prices and volume gains in new housing. Additionally, the U.K. government extended its new home buying program beyond 2016, upon which homebuilders may capitalize. Canadian methanol producer Methanex Corporation was the largest contributor to the Materials sector, as it capitalized on high prices for methanol due to tight supply versus demand. Within Consumer Staples, Irish convenience food producer Greencore Group Plc continued to increase its market share in the U.S., purchasing a food-to-go manufacturer and announcing a greenfield sandwich manufacturing facility. In the U.K., Greencore is capitalizing on growth in the ready-to-eat chilled foods grocery category.
Telecom sector holdings produced strong returns for the year. Deutsche Telekom AG held on to good revenues and earnings, largely due to its T-Mobile/MetroPCS merger. Freenet exceeded its own guidance for 2013, capitalizing on its mobile communications and digital lifestyle services. Financial holdings were led by Germany reinsurers Muenchener Rueckverag AG and Hannover Rueck SE, and two Swedish companies, Svenska Handelsbanken AB and Investor AB.
Energy was the only sector in negative territory for the fiscal year. Maurel et Prom dropped in the March 2014 quarter when it eliminated the dividend, even though it reported a 2013 profit jump. Tullow Oil Plc was down after announcing lackluster 2013 results, with rising revenues but fading operating profit due to exploration write-offs. Thai Oil PCL was affected by the political turbulence in Thailand.
Portfolio Changes
During the fiscal year period ended March 31, 2014, the Fund had an influx of cash flows, which was invested within existing holdings as well as six new stock purchases. Among the new purchases were: Ipsos SA, which conducts market research for global consumer product companies; Tullow Oil Plc, an independent oil explorer focused in Africa; Norway-based fertilizer company, Yara International ASA, which sources natural gas and converts it to upgraded fertilizer; Lanxess AG, a specialty chemical company engaged in synthetic rubber and tire durability products; Finnish building service company Caverion Corporation which was a spin-off from portfolio holding YIT Oyj; and Norwegian savings bank Sparebank 1 SR Bank ASA, which has low loan losses and improving net interest margins. No positions were liquidated during the year.
A Look Ahead
Sectors most prominent in our international research include financials, industrials, consumer discretionary and information technology. The geographies at the top of our list include Japan, Asian countries, emerging markets and the U.K. We have also noticed a significant number of new companies coming on the market, as global macro-economic conditions slowly improve. We have further refined our screening technology to ensure availability of a broad range of investment ideas and added another analyst to our experienced research team.
We believe that the Fund’s fundamental international value investing strategy continue to produce excellent risk-adjusted returns, as evidenced by the Fund’s 16-year performance record. We will strive to maintain this level of success to benefit the Fund’s shareholders.
The Fund’s lead portfolio manager is Bernard R. Horn, Jr., of Polaris Capital Management, LLC
PEAR TREE POLARIS FOREIGN VALUE FUND
Top 10 Holdings
| Percentage of total net assets | 24.6% |
| Greencore Group plc | 3.0% |
| Barratt Developments plc | 2.5% |
| Teva Pharmaceuticals SP | 2.5% |
| Deutsche Telekom AG | 2.5% |
| Methanex Corporation | 2.5% |
| Freenet AG | 2.4% |
| Taylor Wimpey plc | 2.4% |
| Trevi Finanziaria SpA | 2.3% |
| Sasol Ltd. | 2.3% |
| Christian Dior S.A. | 2.2% |
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Sector Allocation
| Percentage of total net assets | 100.0% |
| Materials | 20.1% |
| Consumer Discretionary | 15.8% |
| Financials | 12.9% |
| Industrials | 9.9% |
| Energy | 7.7% |
| Consumer Staples | 7.2% |
| Telecommunication Services | 7.1% |
| Information Technology | 6.2% |
| Health Care | 4.8% |
| Utilities | 1.6% |
| Cash and Other Assets (Net) | 6.7% |
Top 10 Country Allocations
| Percentage of total net assets | 74.5% |
| Germany | 16.3% |
| United Kingdom | 16.2% |
| Japan | 8.0% |
| Sweden | 7.3% |
| France | 6.9% |
| Ireland | 5.1% |
| Finland | 4.8% |
| Italy | 4.3% |
| Norway | 3.1% |
| Canada | 2.5% |
Value of a $10,000 Investment
Pear Tree Polaris Foreign Value (PTFV)
Ordinary Shares vs. MSCI EAFE Index
Average Annual Total Returns
| 1Q 2014 | Six Months | One Year | Five Year | Ten Year | Since Inception | Inception Date | |
| Ordinary Shares | 3.09% | 13.86% | 23.28% | 24.15% | 8.29% | 7.54% | 05/15/98 |
Institutional Shares1 | 3.19% | 14.07% | 23.58% | 24.41% | 8.55% | 9.29% | 12/18/98 |
MSCI EAFE2 | 0.77% | 6.56% | 18.06% | 16.56% | 7.01% | 5.03% | ________ |
1 Institutional Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution fees.
2 The Morgan Stanley Capital International Europe, Australia, and Far East (”MSCI EAFE“) Index is an unmanaged index comprised of stocks located in countries other than the United States. It is widely recognized as representative of the general market for emerging markets. Index returns assume the reinvestment of dividends and, unlike Fund returns, do not reflect fees or expenses. You cannot invest directly in an Index. The beginning date for the Index is 05/29/98.
Investing in foreign markets, particularly emerging markets, can be more volatile than the U.S. market due to increased risks of adverse issuer, political, regulatory, market or economic developments and can perform differently than the U.S. market.
PEAR TREE POLARIS FOREIGN VALUE SMALL CAP FUND
INVESTMENT PROFILE
All Data as of March 31, 2014
| Fund Information | ||
| Net Assets Under Management | $185.7 Million | |
| Number of Companies | 68 | |
| Price to Book Ratio | 1.9 | |
| Price to Earnings Ratio | 16.7 | |
| Ordinary | Institutional | |
| Total Expense Ratio (Gross)* | 1.66% | 1.41% |
| Total Expense Ratio (Net)* | 1.66% | 1.41% |
| Ticker Symbol | QUSOX | QUSIX |
| * per prospectus dated August 1, 2013. See financial highlights for total expense ratios for the fiscal year ended March 31, 2014. | ||
Investment Commentary
For the fiscal year period ended March 31, 2014, the Pear Tree Polaris Foreign Value Small Cap Fund’s Ordinary Shares (the ”Fund“) outperformed its benchmark, the MSCI ACWI ex USA Small Cap Index (the Index”)1 The Fund achieved a return of 26.80% at net asset value compared to 16.69% for the Index.
Market Conditions and Investment Strategies
Nine of 10 sectors contributed to the Fund’s outperformance, led by Industrials, Consumer Staples, Consumer Discretionary and Information Technology. The vast majority of portfolio holdings produced double-digit returns for the period, with nearly a quarter of holdings up in excess of 50%.
In Industrials, construction company Galliford Try Plc benefited from a rebounding U.K. economy, as both price and volumes increased in new home sales. Shanghai Mechanical, a manufacturer of elevators and escalators, was up more than 70%, capitalizing on construction and affordable housing growth in China.
Within Consumer Staples, Irish convenience food producer Greencore Group plc continued to increase its market share in the U.S., purchasing a food-to-go manufacturer and announced a greenfield sandwich manufacturing facility. In the U.K., Greencore is capitalizing on growth in the ready-to-eat chilled foods grocery category.
The Restaurant Group plc and J D Wetherspoon plc led gains in the Consumer Discretionary sector, as U.K. economic optimism led to dining-out trends. With a focus on value for money and unique menus, both companies saw an influx of customers. Theater operator Kinepolis was up after successfully executing its business strategy of cutting costs, driving up revenue per customer and offering B2B events.
The only sector in negative territory was Utilities. Manila Water’s decline was attributable to the on-going court arbitration associated with tariffs disputes. Political turmoil in Thailand affected results for Ratchaburi Electric. Brazil’s Equatorial Energia SA was restricted by higher costs in a weakening economy.
Portfolio Changes
During the fiscal year period ended March 31, 2014, the Fund sold positions in Sichuan Expressway and Manappuram General Finance. Cash was redeployed to eight new positions, each of which was attractively valued with sustainable business models and strong free cash flows. Among the new holdings were: Ipsos, which conducts market research for consumer companies; PKC Group OYJ, a producer of truck electrical controls; Shanghai Mechanical; Semperit AG Holding, a manufacturer of rubber and plastic products; WT Microelectronics Co., Ltd., a Taiwanese electronics distributor; AIN Pharmaciez, Inc., one of the largest Japanese pharmacy companies; and Higashi Nihon House Co. Ltd., a niche homebuilder in Japan. We also purchased Indian IT company Hexaware Technologies during the June quarter. In mid-October, Hexaware was acquired by Baring Private Equity in a $400 million deal. The Fund tendered its shares for a healthy profit.
1 As of August 1, 2013, the Fund replaced its benchmark with the MSCI ACWI (ex USA small cap) because it believes the new index represents the emerging market exposure in the Fund better that the S&P EPAC Index.
A Look Ahead
Sectors most prominent in our small-cap research include Financials, Industrials, Consumer Discretionary and Information Technology. The geographies currently at the top of our list include Japan, Southeast Asian countries, emerging markets and the U.K. We have also noticed a significant number of new small cap companies coming on the market, as global macro-economic conditions slowly improve. We have further refined our screening technology to ensure availability of a broad range of small cap investment ideas and added another analyst to our experienced research team.
We believe that the Fund’s fundamental small-cap value investing strategy can continue to produce excellent top risk-adjusted returns, as evidenced by the Fund’s nearly six-year performance record. We will strive to maintain this level of success to benefit the Fund’s shareholders.
The Fund’s lead portfolio manager is Bernard R. Horn, Jr., of Polaris Capital Management, LLC
PEAR TREE POLARIS FOREIGN VALUE SMALL CAP FUND
Top 10 Holdings
| Percentage of total net assets | 22.8% |
| Greencore Group plc | 3.5% |
| Freenet AG | 2.4% |
| Galliford Try plc | 2.3% |
| UDG Healthcare plc | 2.3% |
| Alternative Networks plc | 2.2% |
| BML, Inc. | 2.1% |
| Chugoku Marine Paints Ltd. | 2.1% |
| Equatorial Energia S.A. | 2.0% |
| M1 Ltd. | 2.0% |
| Vetropack Holding AG | 1.9% |
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Sector Allocation
| Percentage of total net assets | 100.0% |
| Consumer Discretionary | 21.3% |
| Industrials | 14.5% |
| Consumer Staples | 12.1% |
| Information Technology | 10.2% |
| Financials | 9.3% |
| Telecommunication Services | 8.1% |
| Health Care | 6.2% |
| Materials | 5.8% |
| Utilities | 4.7% |
| Cash and Other Assets (Net) | 7.8% |
Top 10 Country Allocations
| Percentage of total net assets | 70.0% |
| United Kingdom | 13.7% |
| Japan | 11.3% |
| Ireland | 8.8% |
| Germany | 7.2% |
| India | 6.3% |
| Hong Kong | 5.4% |
| Norway | 5.2% |
| Sweden | 4.4% |
| Thailand | 4.3% |
| Singapore | 3.4% |
Value of a $10,000 Investment
Pear Tree Polaris Foreign Value Small Cap (PTFVSC)
Ordinary Shares vs. MSCI ACWI ex USA Small Cap Index
Average Annual Total Returns
| 1Q 2014 | Six Months | One Year | Five Year | Ten Year | Since Inception | Inception Date | |
| Ordinary Shares | 8.84% | 20.38% | 26.80% | 27.24% | 8.56% | 5/1/2008 | |
Institutional Shares1 | 8.92% | 20.51% | 27.16% | 27.55% | 8.80% | 5/1/2008 | |
MSCI ACWI ex USA Small Cap2 | 3.56% | 8.39% | 16.69% | 21.59% | 4.75% | ________ | |
S&P/EPAC Small Cap3 | 3.81% | 9.96% | 23.89% | 21.24% | 4.60% | ________ |
1 Institutional Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution fees.
2 The MSCI ACWI ex USA Small Cap Index captures small cap representation across 23 developed markets and 21 emerging market countries
3 The S&P/Europe Pacific Asia Composite (“S&P/EPAC”) Index measures the bottom 20% of institutionary investable capital of developed and emerging (after 09/30/1994) countries, selected by the index sponsor outside of the United States. It is widely recognized as representative of the general market for foreign markets. Index returns assume the reinvestment of dividends and, unlike Fund returns, do no reflect any fees or expenses. You cannot invest directly in an Index. The beginning date for the Index is 5/1/2008.
Investing in foreign markets, particularly emerging markets, can be more volatile than the U.S. market due to increased risks of adverse issuer, political, regulatory, market or economic developments and can perform differently than the U.S. market.
PEAR TREE COLUMBIA SMALL CAP FUND
SCHEDULE OF INVESTMENTS
March 31, 2014
Common Stock—100.2%
| Shares | Value | |
| AIRLINES—1.0% | ||
| Spirit Airlines, Inc. (a) | 19,467 | $ 1,156,340 |
| BANKS—3.6% | ||
| Central Pacific Financial Corp. | 49,358 | 997,032 |
| CoBiz Financial, Inc. | 109,129 | 1,257,166 |
| F.N.B. Corporation | 146,970 | 1,969,398 |
| 4,223,596 | ||
| BUILDING PRODUCTS—3.7% | ||
| Builders FirstSource, Inc. (a) | 187,687 | 1,709,828 |
| Drew Industries, Inc. | 25,269 | 1,369,580 |
| NCI Building Systems, Inc. (a) | 72,848 | 1,271,927 |
| 4,351,335 | ||
| CHEMICALS—4.0% | ||
| Cambrex Corporation (a) | 95,064 | 1,793,858 |
| Ferro Corporation (a) | 209,182 | 2,857,426 |
| 4,651,284 | ||
| COMMERCIAL SERVICES & SUPPLIES—9.6% | ||
| Acacia Research Corporation—Acacia Technologies (b) | 27,892 | 426,190 |
| Cardtronics, Inc. (a) | 37,296 | 1,448,950 |
| Euronet Worldwide, Inc. (a) | 29,290 | 1,218,171 |
| Heartland Payment Systems, Inc. | 19,352 | 802,140 |
| Kforce, Inc. | 123,417 | 2,631,250 |
| On Assignment, Inc. (a) | 25,258 | 974,706 |
| WageWorks, Inc. (a) | 38,825 | 2,178,471 |
| Waste Connections, Inc. | 35,764 | 1,568,609 |
| 11,248,487 | ||
| COMMUNICATIONS EQUIPMENT—3.0% | ||
| Allot Communications Ltd. (a)(b) | 68,769 | 925,631 |
| NICE-Systems Ltd. (c) | 38,310 | 1,710,924 |
| Ubiquiti Networks, Inc. (a)(b) | 19,751 | 898,078 |
| 3,534,633 | ||
| CONSTRUCTION & ENGINEERING—2.6% | ||
| MasTec, Inc. (a) | 70,114 | 3,045,752 |
| CONSTRUCTION MATERIALS—1.0% | ||
| Trex Company, Inc. (a) | 15,658 | 1,145,539 |
| DIVERSIFIED FINANCIALS—3.4% | ||
| Hercules Technology Growth Capital, Inc. | 71,640 | 1,007,975 |
| ICG Group, Inc. (a) | 145,952 | 2,980,340 |
| 3,988,315 | ||
| ELECTRONIC EQUIPMENT & INSTRUMENTS—3.8% | ||
| Applied Optoelectronics, Inc. (a) | 46,223 | 1,140,321 |
| Finisar Corporation (a) | 125,345 | 3,322,896 |
| 4,463,217 | ||
| ENERGY EQUIPMENT & SERVICES—2.5% | ||
| Core Laboratories N.V. | 14,707 | 2,918,457 |
| FOOD & DRUG RETAILING—1.0% | ||
| United Natural Foods, Inc. (a) | 16,409 | 1,163,726 |
| FOOD PRODUCTS—1.6% | ||
| Boulder Brands, Inc. (a) | 111,123 | 1,957,987 |
| HEALTH CARE EQUIPMENT & SUPPLIES—10.2% | ||
| Accuray Incorporated (a)(b) | 252,842 | 2,427,283 |
| BioTelemetry, Inc. (a) | 269,221 | 2,716,440 |
| Cardiovascular Systems, Inc. (a) | 43,114 | 1,370,594 |
| Halozyme Therapeutics, Inc. (a) | 37,906 | 481,406 |
| LDR Holding Corporation (a) | 22,359 | 767,585 |
| Natus Medical, Inc. (a) | 53,502 | 1,380,352 |
| Novadaq Technologies, Inc. (a) | 41,293 | 920,008 |
| Spectranetics Corporation (The) (a) | 52,538 | 1,592,427 |
| STAAR Surgical Company (a) | 18,778 | 353,026 |
| 12,009,121 | ||
| HEALTH CARE PROVIDERS & SERVICES—2.9% | ||
| Catamaran Corporation (a) | 27,814 | 1,244,955 |
| Henry Schein, Inc. (a) | 17,669 | 2,109,148 |
| 3,354,103 | ||
| HOTELS, RESTAURANTS & LEISURE—1.0% | ||
| National CineMedia, Inc. | 78,030 | 1,170,450 |
| HOUSEHOLD DURABLES—0.9% | ||
| Standard Pacific Corporation (a) | 131,447 | 1,092,325 |
| INSURANCE—0.5% | ||
| United Insurance Holdings Corp. | 41,656 | 608,594 |
| INTERNET SOFTWARE & SERVICES—0.9% | ||
| Brightcove, Inc. (a) | 86,010 | 845,478 |
| eGain Corporation (a) | 31,147 | 219,898 |
1,065,376 | ||
| IT CONSULTING & SERVICES—5.9% | ||
| Alliance Data Systems Corporation (a) | 20,071 | 5,468,344 |
| EPAM Systems, Inc. (a) | 43,781 | 1,440,395 |
| 6,908,739 | ||
| MACHINERY—3.1% | ||
| Actuant Corporation, Class A | 17,783 | 607,290 |
| Proto Labs, Inc. (a) | 45,205 | 3,059,022 |
| 3,666,312 | ||
| MEDIA—9.6% | ||
| AMC Entertainment Holdings, Inc., Class A (a) | 47,372 | 1,148,771 |
| Cinemark Holdings, Inc. | 61,945 | 1,797,024 |
| Entravision Communications Corporation, Class A | 239,838 | 1,606,915 |
| Gray Television, Inc. (a) | 86,400 | 895,968 |
| IMAX Corporation (a) | 96,485 | 2,636,935 |
| Nexstar Broadcasting Group, Inc., Class A | 34,061 | 1,277,969 |
| Regal Entertainment Group, Class A | 101,386 | 1,893,890 |
| 11,257,472 | ||
| OIL & GAS—1.0% | ||
| Bonanza Creek Energy, Inc. | 25,431 | 1,129,136 |
| PERSONAL PRODUCTS—2.9% | ||
| Elizabeth Arden, Inc. (a) | 46,058 | 1,359,171 |
| Nu Skin Enterprises, Inc., Class A | 24,262 | 2,010,107 |
| 3,369,278 | ||
| PHARMACEUTICALS & BIOTECHNOLOGY—1.3% | ||
| Orexigen Therapeutics, Inc. (a) | 82,624 | 537,056 |
| Receptos, Inc. (a) | 14,052 | 589,341 |
| Tetraphase Pharmaceuticals, Inc. (a) | 37,886 | 412,579 |
| 1,538,976 | ||
| REAL ESTATE—8.3% | ||
| Brandywine Realty Trust | 61,681 | 891,907 |
| DuPont Fabros Technology, Inc. | 44,638 | 1,074,437 |
| EPR Properties | 98,474 | 5,257,527 |
| Hersha Hospitality Trust | 293,779 | 1,712,731 |
| Physicians Realty Trust | 38,158 | 531,159 |
| Terreno Realty Corporation | 12,936 | 244,620 |
| 9,712,381 | ||
| SEMICONDUCTOR EQUIPMENT & PRODUCTS—1.0% | ||
| 8x8, Inc. (a) | 109,131 | 1,179,706 |
| SOFTWARE—3.7% | ||
| Ambarella, Inc. (a)(b) | 37,870 | 1,011,508 |
| Control4 Corporation (a)(b) | 65,573 | 1,390,803 |
| Rally Software Development Corp. (a) | 34,775 | 465,290 |
| Rocket Fuel, Inc. (a)(b) | 20,205 | 866,390 |
| Verint Systems, Inc. (a) | 11,576 | 543,262 |
| 4,277,253 | ||
| SPECIALTY RETAIL—4.1% | ||
| Asbury Automotive Group, Inc. (a) | 44,413 | 2,456,483 |
| Pier 1 Imports, Inc. | 52,191 | 985,366 |
| Restoration Hardware Holdings, Inc. (a) | 17,706 | 1,302,985 |
| 4,744,834 | ||
| TEXTILES & APPAREL—2.1% | ||
| Kate Spade & Company (a) | 66,213 | 2,455,840 |
| TOTAL COMMON STOCK | ||
| (Cost $84,013,749) | 117,388,564 | |
| Short Term Investments—0.6% | ||
| Par Value | Value | |
| State Street Bank & Trust Co., Repurchase Agreement 0.0%, 04/01/14, (Dated 03/31/14), Collateralized by $730,000 par U.S. Treasury Note-0.625% due 11/30/2017, Market Value $714,122, Repurchase Proceeds $696,991 (Cost $696,991) | $696,991 | $696,991 |
| TOTAL INVESTMENTS (EXCLUDING INVESTMENTS PURCHASED WITH CASH COLLATERAL FROM SECURITIES LOANED)—100.8% | ||
| (Cost $84,710,740) | 118,085,555 | |
| INVESTMENTS PURCHASED WITH CASH COLLATERAL FROM SECURITIES LOANED—5.6% | ||
| Money Market—5.6% | ||
| Western Asset Institutional Cash Reserves—Inst. | ||
| (Cost $6,571,585) | 6,571,585 | |
TOTAL INVESTMENTS—106.4% (Cost $91,282,325) | 124,657,140 | |
| OTHER ASSETS & LIABILITIES (NET)—(6.4%) | (7,475,061) | |
| NET ASSETS—100% | $117,182,079 |
| (a) | Non-income producing security |
| (b) | All or a portion of this security was out on loan. |
| (c) | ADR—American Depositary Receipts |
| (d) | At March 31, 2014, the unrealized appreciation of investments based on aggregate cost for federal tax purposes of $91,741,379 was as follows: |
| Aggregate gross unrealized appreciation for all investments in which there is an excess of value over tax cost | $35,591,625 |
| Aggregate gross unrealized depreciation for all investments in which there is an excess of tax cost over value | (2,675,864) |
| Net unrealized appreciation / (depreciation) | $32,915,761 |
| The percentage of each investment category is calculated as a percentage of net assets. |
PEAR TREE QUALITY FUND
SCHEDULE OF INVESTMENTS
March 31, 2014
Common Stock—99.5%
| Shares | Value | |
| AEROSPACE & DEFENSE—0.8% | ||
| Precision Castparts Corp. | 686 | $173,393 |
| United Technologies Corporation | 7,585 | 886,232 |
| 1,059,625 | ||
| BEVERAGES—4.2% | ||
| Anheuser-Busch InBev S.A. (c) | 1,768 | 186,170 |
| Coca-Cola Company (The) | 132,336 | 5,116,110 |
| 5,302,280 | ||
| CHEMICALS—0.1% | ||
| Monsanto Company | 1,672 | 190,223 |
| COMMUNICATIONS EQUIPMENT—1.8% | ||
| QUALCOMM Incorporated | 27,925 | 2,202,166 |
| COMPUTERS & PERIPHERALS—7.6% | ||
| Apple, Inc. | 3,930 | 2,109,388 |
| EMC Corporation | 29,405 | 805,991 |
| Hewlett-Packard Company | 45,066 | 1,458,336 |
| International Business Machines | 26,692 | 5,137,943 |
| 9,511,658 | ||
| CONSUMER SERVICES—0.3% | ||
| McKesson Corporation | 1,736 | 306,525 |
| DISTRIBUTORS—0.1% | ||
| Genuine Parts Company | 1,575 | 136,789 |
| ELECTRONIC EQUIPMENT & INSTRUMENTS—0.5% | ||
| Emerson Electric Co. | 8,516 | 568,869 |
| FOOD PRODUCTS—0.8% | ||
| Nestle, S.A. (c) | 7,152 | 537,973 |
| Unilever N.V. | 11,396 | 468,604 |
| Unilever N.V. (c) | 4 | 171 |
| 1,006,748 | ||
| FOOD STAPLES & DRUG RETAILING—8.4% | ||
| Costco Wholesale Corporation | 5,721 | 638,921 |
| CVS Caremark Corporation | 10,252 | 767,465 |
| General Mills, Inc. | 9,082 | 470,629 |
| PepsiCo, Inc. | 40,590 | 3,389,265 |
| SYSCO Corporation | 17,082 | 617,173 |
| Tesco PLC (a)(c) | 11,408 | 170,322 |
| Walgreen Co. | 11,711 | 773,277 |
| Wal-Mart Stores, Inc. | 48,109 | 3,676,971 |
| 10,504,023 | ||
| HEALTH CARE EQUIPMENT & SERVICES—8.3% | ||
| Baxter International, Inc. | 9,098 | 669,431 |
| Becton, Dickinson and Company | 5,355 | 626,963 |
| Covidien plc | 2,286 | 168,387 |
| Express Scripts, Inc. (a) | 45,791 | 3,438,446 |
| Humana Inc. (a) | 487 | 54,895 |
| Medtronic, Inc. | 33,810 | 2,080,667 |
| Stryker Corporation | 8,289 | 675,305 |
| UnitedHealth Group, Inc. | 23,528 | 1,929,061 |
| Zimmer Holdings, Inc. (a) | 7,788 | 736,589 |
| 10,379,744 | ||
| HEALTH CARE PROVIDERS & SERVICES—0.7% | ||
| Laboratory Corporation of America Holdings (a) | 3,427 | 336,566 |
| Quest Diagnostics Incorporated | 4,316 | 249,983 |
| WellPoint, Inc. | 3,244 | 322,940 |
| 909,489 | ||
| HOTELS, RESTAURANTS & LEISURE—1.6% | ||
| McDonald’s Corporation | 19,070 | 1,869,432 |
| YUM! Brands, Inc. | 908 | 68,454 |
| 1,937,886 | ||
| HOUSEHOLD PRODUCTS—6.4% | ||
| Church & Dwight Co., Inc. | 2,427 | 167,633 |
| Colgate-Palmolive Company | 31,748 | 2,059,493 |
| Kimberly-Clark Corporation | 5,369 | 591,932 |
| Procter & Gamble Company | 63,805 | 5,142,683 |
| Reckitt Benckiser Group plc (a) | 3 | 247 |
| 7,961,988 | ||
| INDUSTRIAL CONGLOMERATES—2.0% | ||
| 3M Company | 17,986 | 2,439,981 |
| IT CONSULTING & SERVICES—0.6% | ||
| Accenture plc | 4,285 | 341,600 |
| Automatic Data Processing, Inc. | 1,873 | 144,708 |
| Cognizant Technology Solutions Corporation (a) | 3,958 | 200,315 |
| Paychex, Inc. | 900 | 38,340 |
| 724,963 | ||
| LEISURE EQUIPMENT & PRODUCTS—0.0% | ||
| Mattel, Inc. | 1,004 | 40,270 |
| MACHINERY—0.7% | ||
| Cummins, Inc. | 387 | 57,659 |
| Danaher Corporation | 5,417 | 406,275 |
| Illinois Tool Works Inc. | 4,705 | 382,658 |
| 846,592 | ||
| MULTILINE RETAIL—0.7% | ||
| Target Corporation | 14,367 | 869,347 |
| OIL & GAS—7.0% | ||
| BP plc (c) | 6,274 | 301,779 |
| Chevron Corporation | 42,209 | 5,019,072 |
| Exxon Mobil Corporation | 27,489 | 2,685,126 |
| Royal Dutch Shell plc (c) | 5,427 | 396,497 |
| TOTAL S.A. (b)(c) | 5,440 | 356,864 |
| 8,759,338 | ||
| PHARMACEUTICALS & BIOTECHNOLOGY—18.8% | ||
| Abbott Laboratories | 52,932 | 2,038,411 |
| Allergan, Inc. | 1,881 | 233,432 |
| Amgen, Inc. | 10,732 | 1,323,685 |
| AstraZeneca PLC (c) | 15,564 | 1,009,792 |
| Bristol-Myers Squibb Company | 29,335 | 1,523,953 |
| Eli Lilly and Company | 19,556 | 1,151,066 |
| Gilead Sciences, Inc. (a) | 11,881 | 841,888 |
| GlaxoSmithKline plc (c) | 24,489 | 1,308,447 |
| Johnson & Johnson | 69,853 | 6,861,660 |
| Merck & Co., Inc. | 28,586 | 1,622,827 |
| Novartis AG (c) | 5,811 | 494,051 |
| Novo Nordisk A/S (c) | 2,435 | 111,158 |
| Pfizer Inc. | 112,375 | 3,609,485 |
| Roche Holding Ltd. (c) | 24,354 | 918,633 |
| Sanofi-Aventis (c) | 7,948 | 415,522 |
| Takeda Pharmaceutical Company Limited (a)(c) | 38 | 901 |
| 23,464,911 | ||
| RETAILING—0.4% | ||
| Home Depot, Inc. (The) | 4,566 | 361,308 |
| TJX Companies, Inc. (The) | 3,017 | 182,981 |
| 544,289 | ||
| SEMICONDUCTOR EQUIPMENT—0.1% | ||
| Texas Instruments, Inc. | 3,650 | 172,097 |
| SOFTWARE & SERVICES—21.6% | ||
| Adobe Systems Incorporated | 4,883 | 321,008 |
| Cisco Systems, Inc. | 150,174 | 3,365,399 |
| eBay, Inc. (a) | 10,565 | 583,611 |
| Google, Inc. (a) | 6,291 | 7,011,382 |
| Intuit Inc. | 5,340 | 415,078 |
| MasterCard Incorporated | 7,736 | 577,879 |
| Microsoft Corporation | 179,829 | 7,371,191 |
| Oracle Corporation | 162,401 | 6,643,825 |
| SAP AG (c) | 3,106 | 252,549 |
| Visa, Inc. | 1,940 | 418,769 |
| 26,960,691 | ||
| SPECIALTY RETAIL—0.2% | ||
| Bed Bath & Beyond Inc. | 3,541 | 243,621 |
| TEXTILES & APPAREL—0.8% | ||
| Nike, Inc. | 13,224 | 976,725 |
| V.F. Corporation | 206 | 12,747 |
| 989,472 | ||
| TOBACCO—4.7% | ||
| British American Tobacco p.l.c. (c) | 4,013 | 447,168 |
| Japan Tobacco Inc. (a) | 20,000 | 624,000 |
| Lorillard, Inc. | 10,727 | 580,116 |
| Philip Morris International, Inc. | 52,172 | 4,271,322 |
| 5,922,606 | ||
| TRADING COMPANIES & DISTRIBUTION—0.1% | ||
| W.W. Grainger, Inc. | 554 | 139,973 |
| WIRELESS TELECOMMUNICATIONS—0.2% | ||
| NTT DOCOMO, Inc. (a)(b)(c) | 13,151 | 207,391 |
TOTAL COMMON STOCK (Cost $102,593,571) | 124,303,555 |
Short Term Investments—0.3%
| Par Value | Value | |
| State Street Bank & Trust Co., Repurchase Agreement .0%, 04/01/14, (Dated 03/31/14), Collateralized by 415,000 par U.S. Treasury Note-.625% due 11/30/2017, Market Value $405,973, Repurchase Proceeds $394,596 (Cost $394,596) | $394,596 | $394,596 |
| TOTAL INVESTMENTS (EXCLUDING INVESTMENTS PURCHASED WITH CASH COLLATERAL FROM SECURITIES LOANED)—99.8% | ||
| (Cost $102,988,167) | 124,698,151 | |
| Money Market—0.5% | ||
Western Asset Institutional Cash Reserves—Inst. (Cost $566,740) | 566,740 | 566,740 |
TOTAL INVESTMENTS 100.3% (Cost $103,554,907) | 125,264,891 | |
| OTHER ASSETS & LIABILITIES (NET)—(0.3%) | (362,738) | |
| NET ASSETS—100% | $124,902,153 |
| (a) | Non-Income producing security |
| (b) | All or a portion of this security is out on loan |
| (c) | ADR—American Depositary Receipts |
| (d) | At March 31, 2014, the unrealized appreciation of investments based on aggregate cost for federal tax purposes of $103,908,536 was as follows: |
| Aggregate gross unrealized appreciation for all investments in which there is an excess of value over tax cost | $21,552,775 |
| Aggregate gross unrealized depreciation for all investments in which there is an excess of tax cost over value | (196,420) |
| Net unrealized appreciation / (depreciation) | $21,356,355 |
| The percentage of each investment category is calculated as a percentage of net assets. |
PEAR TREE PANAGORA DYNAMIC EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS
March 31, 2014
Common Stock—71.7%
| Shares | Value | |
| BRAZIL—5.8% | ||
| Ambev SA (c) | 149,030 | $ 1,104,312 |
| Banco do Brasil S.A. | 94,412 | 954,333 |
| BM&F Bovespa S.A. | 111,024 | 553,742 |
| CIA Paranaense Ener. SP ADR (c) | 29,309 | 384,241 |
| Cyrela Brazil Realty S.A. Empreendimentos e Participacoes | 138,900 | 841,184 |
| Even Construtora e Incorporadora S.A. | 191,600 | 645,575 |
| EZ Tec Empreendimentos e Participacoes S.A. | 42,835 | 534,583 |
| JBS S.A. | 219,300 | 754,464 |
| Petroleo Brasileiro S.A. | 72,283 | 479,408 |
| Petroleo Brasileiro S.A. (c) | 65,765 | 912,161 |
| Sao Martinho S.A. | 15,318 | 210,524 |
| Sul America S.A. | 80,118 | 538,122 |
| Vale S.A. | 44,953 | 626,185 |
| 8,538,834 | ||
| CHINA—10.4% | ||
| Bank of China Ltd., H | 3,943,392 | 1,748,834 |
| China BlueChemical Ltd. H | 272,000 | 139,914 |
| China Construction Bank Corporation | 3,146,422 | 2,202,607 |
| China Life Insurance Co,. Limited | 99,000 | 280,788 |
| China Pacific Insurance Group H Shares | 81,000 | 290,302 |
| China Petroleum & Chemical Corporation | 1,735,810 | 1,557,513 |
| China Power International Development Ltd. (b) | 550,000 | 190,737 |
| China Shenhua Energy Co., Ltd. | 168,605 | 486,899 |
| China Yuchai International Ltd. | 14,573 | 308,656 |
| Dongfeng Motor Group Company Limited | 198,881 | 282,550 |
| Fosun International (b) | 216,000 | 271,227 |
| Giant Interactive Group, Inc. (c) | 45,346 | 524,653 |
| Guangzhou R&F Properties Co., Ltd. H | 79,200 | 114,153 |
| Industrial & Commercial Bank of China Ltd. | 1,639,911 | 1,008,460 |
| Kingsoft Corporation Ltd. (b) | 228,000 | 897,979 |
| Mindray Medical International Ltd. (b)(c) | 12,441 | 402,591 |
| PetroChina Company Limited | 935,778 | 1,019,412 |
| Ping An Insurance Group H Share | 36,000 | 298,424 |
| Sino Biopharmaceutical Limited | 560,000 | 476,488 |
| SINOPEC Engineering (Group) Co., Ltd. Class H | 352,000 | 380,283 |
| Sinotrans Ltd. H Shares | 662,000 | 331,139 |
| Tencent Holdings Limited | 23,600 | 1,641,435 |
| Tong Ren Tang Technologies Co., Ltd. H | 47,000 | 151,784 |
| Zhejiang Expressway Co., Ltd. | 400,000 | 364,586 |
15,371,414 | ||
| COLOMBIA—0.4% | ||
| Ecopetrol S.A. (b)(c) | 14,251 | $581,298 |
| CZECH REPUBLIC—0.2% | ||
| CEZ A.S. (b) | 10,307 | 295,423 |
| HONG KONG—5.5% | ||
| Agile Property Holdings Ltd. | 400,000 | 327,972 |
| Central China Real Estate Ltd. | 252,371 | 66,047 |
| Champion Real Estate Investment Trust | 504,000 | 230,014 |
| China Mobile Limited | 215,779 | 1,975,094 |
| China South City Holdings Limited (b) | 394,000 | 179,812 |
| Chongqing Rural Commercial Bank Co. | 838,687 | 368,701 |
| CNOOC Limited | 956,218 | 1,437,393 |
| COSCO International Holdings Ltd. | 173,193 | 69,887 |
| Dongyue Group Ltd. (b) | 410,000 | 166,500 |
| FIH Mobile Ltd. (a) | 663,000 | 365,829 |
| Geely Automobile Holdings Ltd. | 1,740,000 | 684,178 |
| Giordano International Limited | 326,000 | 210,140 |
| KWG Property Holding Limited | 568,919 | 312,450 |
| Shanghai Industrial Holdings Limited | 60,000 | 198,408 |
| Shun Tak Holdings Ltd. | 270,000 | 139,234 |
| SJM Holdings Limited | 253,000 | 711,045 |
| Soho China Limited | 842,479 | 692,947 |
| 8,135,651 | ||
| HUNGARY—0.3% | ||
| Richter Gedeon Nyrt (b) | 28,085 | 489,883 |
| INDIA—4.9% | ||
| Allahabad Bank | 29,921 | 45,365 |
| Andhra Bank | 214,842 | 229,150 |
| Bajaj Holdings & Investment Limited | 11,984 | 204,675 |
| Bank of Baroda | 16,624 | 200,136 |
| Bharat Petroleum Corporation Ltd. | 38,113 | 293,366 |
| Cairn India Ltd. | 20,649 | 114,858 |
| Chambal Fertilizers & Chemicals Ltd. | 128,923 | 86,024 |
| Gitanjali Gems Limited | 62,659 | 62,216 |
| HDFC Bank Ltd. (c) | 5,128 | 210,402 |
| Hexaware Technologies Limited | 192,114 | 485,733 |
| Housing Development Finance Corp Ltd. | 14,075 | 207,393 |
| Indiabulls Housing Finance Limited | 158,659 | 624,302 |
| Indian Bank | 104,046 | 201,045 |
| Infosys Technologies Ltd. (c) | 7,778 | 421,412 |
| Oil and Natural Gas Corp. Limited | 176,612 | 941,576 |
| Oil India Limited | 16,727 | 134,718 |
| Power Finance Corporation Limited | 146,519 | 473,125 |
| Reliance Industries Ltd. | 14,789 | 232,226 |
| Rural Electrification Corporation Limited | 202,813 | 777,666 |
| South Indian Bank Ltd. | 179,919 | 67,181 |
| Syndicate Bank | 174,771 | 279,616 |
| Tata Consultancy Services Ltd. | 4,185 | 149,888 |
| UCO Bank | 259,116 | 316,723 |
| United Phosphorus Limited | 161,084 | 499,658 |
| 7,258,454 | ||
| INDONESIA—0.7% | ||
| PT Bank Bukopin Tbk | 2,989,500 | 168,423 |
| PT PP London Sumatra Indonesia Tbk | 1,256,840 | 244,508 |
| PT Surya Semesta Internusa Tbk | 1,206,000 | 101,385 |
| PT Telekomunikasi Indonesia Persero Tbk | 2,823,290 | 550,492 |
| 1,064,808 | ||
| ISRAEL—0.5% | ||
| First International Bank of Israel Ltd. | 4,735 | 78,181 |
| Mizrahi Tefahot Bank Ltd. | 44,721 | 611,108 |
| 689,289 | ||
| MALAYSIA—3.1% | ||
| Affin Holdings Berhad | 161,900 | 191,871 |
| Berjaya Sports Toto Berhad | 119,154 | 144,860 |
| British American Tobacco (Malaysia) Berhad | 21,344 | 386,421 |
| DRB-HICOM Berhad | 221,399 | 167,465 |
| Genting Malaysia Berhad | 388,609 | 499,819 |
| JCY International Berhad | 341,400 | 75,797 |
| KLCC Property Holdings Berhad | 66,800 | 129,897 |
| Kuala Lumpur Kepong Berhad | 47,200 | 349,790 |
| Lafarge Malaysia Berhad | 33,880 | 93,791 |
| Malaysia Building Society Berhad | 437,112 | 291,810 |
| Parkson Holdings Berhad | 117,800 | 108,222 |
| Petronas Chemicals Group Berhad | 174,200 | 368,618 |
| Telekom Malaysia Berhad | 205,478 | 370,622 |
| Tenaga Nasional Berhad | 226,300 | 828,831 |
| UMW Holdings Berhad | 179,293 | 602,859 |
4,610,673 | ||
| MEXICO—2.9% | ||
| Alfa S.A.B. de C.V., Series A | 84,490 | 213,530 |
| America Movil S.A.B. de C.V., Series L | 934,370 | 931,687 |
| Controladora Comercial Mexicana S.A. de C.V. (b) | 59,500 | 246,749 |
| Fomento Economico Mexicano S.A.B. (c) | 2,734 | 254,918 |
| GRUMA, S.A.B. de C.V., Series B (a) | 108,807 | 899,955 |
| Grupo Aeroportuario del Pacifico S.A.B. (c) | 5,600 | 327,544 |
| Grupo Carso SAB de C.V., Series A1 | 55,000 | 288,532 |
| Grupo Financiero Banorte SAB de C.V. | 28,800 | 194,735 |
| Grupo Herdez, S. A. B. de C. V., Series | 13,854 | 41,167 |
| Grupo Mexico S.A.B. de C.V., Series B | 90,198 | 284,599 |
| Grupo Televisa S.A.B. (c) | 11,859 | 394,786 |
| Organizacion Soriana S.A.B. de C.V., Series B (a) | 20,200 | 62,189 |
| Wal-Mart de Mexico, S.A.B. de C.V. | 37,400 | 89,078 |
| 4,229,469 | ||
| PHILIPPINES—0.4% | ||
| Aboitiz Equity Ventures, Inc. | 46,340 | 57,867 |
| Alliance Global Group, Inc. | 588,600 | 374,069 |
| Rizal Commercial Banking Corporation | 58,690 | 61,510 |
| Universal Robina Corporation | 47,920 | 151,737 |
| 645,183 | ||
| POLAND—1.2% | ||
| Asseco Poland S.A. | 6,825 | 105,888 |
| KGHM Polska Miedz S.A. (b) | 17,677 | 636,130 |
| PGE S.A. | 132,280 | 826,163 |
| Tauron Polska Energia S.A. | 137,757 | 238,992 |
| 1,807,173 | ||
| RUSSIA—4.0% | ||
| Gazprom (c) | 180,222 | 1,387,709 |
| LUKoil (c) | 27,821 | 1,545,735 |
| Magnit OJSC (Reg S) (d) | 2,789 | 152,837 |
| Mail.ru Group Ltd. (a)(d) | 4,212 | 149,315 |
| MegaFon (d) | 8,247 | 232,153 |
| Mobile TeleSystems (c) | 13,485 | 235,853 |
| Norilsk Nickel Mining and Metallurgical Co. (c) | 26,342 | 438,067 |
| PhosAgro (d) | 9,427 | 105,111 |
| Sberbank of Russia (a)(c) | 101,115 | 982,838 |
| Severstal (b)(d) | 59,106 | 447,433 |
| Sistema JSFC (Reg S) (d) | 8,812 | 198,358 |
| 5,875,409 | ||
| SINGAPORE—0.8% | ||
| ComfortDelGro Corporation Limited | 380,000 | 599,436 |
| DBS Group Holdings Ltd. | 11,000 | 141,352 |
| UOL Group Limited | 76,000 | 378,082 |
| 1,118,870 | ||
| SOUTH AFRICA—6.0% | ||
| African Rainbow Minerals Limited | 23,435 | 464,260 |
| Barloworld Limited | 42,061 | 440,473 |
| FirstRand Limited | 336,453 | 1,153,489 |
| Gold Fields Ltd. (c) | 93,079 | 343,461 |
| Imperial Holdings Limited | 35,437 | 634,381 |
| Liberty Holdings Limited | 67,904 | 801,905 |
| Mondi Limited | 17,427 | 306,031 |
| MTN Group Limited | 39,638 | 811,413 |
| Naspers Limited N Shs | 9,062 | 999,460 |
| Reunert Limited | 26,510 | 162,387 |
| RMB Holdings Ltd. | 161,113 | 733,824 |
| Sasol Ltd. | 32,879 | 1,840,924 |
| Tongaat Hulett Limited | 7,879 | 85,062 |
| 8,777,070 | ||
| SOUTH KOREA—10.2% | ||
| Daelim Industrial Co., Ltd. | 8,741 | 711,959 |
| Daewoong Pharmaceutical Company Ltd. | 1,622 | 106,818 |
| Daishin Securities Company | 9,781 | 82,056 |
| Daou Technology, Inc. | 21,495 | 288,767 |
| DGB Financial Group Inc. | 12,280 | 177,662 |
| GS Home Shopping, Inc. | 544 | 121,122 |
| Hana Financial Group, Inc. | 11,700 | 427,573 |
| Hankook Tire Co. Ltd. | 8,910 | 176,199 |
| Hanwha Corporation | 8,370 | 252,409 |
| Hyundai Motor Company Ltd. | 5,986 | 1,411,514 |
| Industrial Bank of Korea (b) | 45,960 | 582,893 |
| Kangwon Land Inc. | 7,320 | 213,180 |
| KB Financial Group Inc. | 2,750 | 96,235 |
| KCC Corporation | 1,393 | 713,218 |
| Kia Motors Corporation | 8,599 | 479,046 |
| KT Corporation | 10,020 | 278,163 |
| KT&G Corporation | 8,703 | 654,084 |
| LG Display Co., Ltd. (a) | 1,240 | 31,045 |
| LG Fashion Corp. | 6,440 | 168,797 |
| Meritz Fire & Marine Insurance Co., Ltd. | 16,280 | 227,120 |
| Naver Corp. | 365 | 265,405 |
| POSCO | 869 | 241,650 |
| Samsung Electronics Company, Ltd. | 3,776 | 4,764,120 |
| Shinhan Financial Group Co., Ltd. | 5,260 | 232,252 |
| SK Holdings Co., Ltd. | 3,310 | 600,150 |
| SK Hynix Inc. (a) | 5,970 | 201,907 |
| SK Innovation Co., Ltd. | 1,879 | 215,358 |
| SK Telecom Co., Ltd. (c) | 17,436 | 393,531 |
| Soulbrain Co., Ltd. | 8,605 | 310,021 |
| Sungwoo Hitech Co., Ltd. | 34,625 | 549,732 |
| 14,973,986 | ||
| TAIWAN—11.0% | ||
| ASUSTeK Computer, Inc. | 108,488 | 1,074,103 |
| Chailease Holding Co., Ltd. | 97,200 | 233,325 |
| Chicony Electronics Co., Ltd. | 116,473 | 302,155 |
| Chinatrust Financial Holding Co., Ltd. | 935,570 | 585,259 |
| Chunghwa Telecom Co., Ltd. | 212,600 | 654,154 |
| Farglory Land Development Co., Ltd. | 248,302 | 423,180 |
| Fubon Financial Holding Co., Ltd. | 681,000 | 923,579 |
| Highwealth Construction Corp. | 131,916 | 311,028 |
| Hon Hai Precision Industry Co., Ltd. | 332,209 | 941,454 |
| Inventec Corporation | 716,000 | 705,361 |
| Lite-On Technology Corp. | 398,994 | 594,839 |
| Pegatron Corporation | 93,416 | 139,115 |
| Phison Electronics Corp. | 104,015 | 669,467 |
| Pou Chen Corporation | 619,631 | 873,923 |
| Powertech Technology, Inc. | 324,000 | 489,950 |
| President Chain Store Corp. | 134,915 | 952,524 |
| Radiant Opto-Electronics Corporation | 202,409 | 817,545 |
| Realtek Semiconductor Corporation | 136,000 | 409,976 |
| Taiwan Semiconductor Manufacturing Co., Ltd. | 658,270 | 2,561,530 |
| TECO Electric & Machinery Co., Ltd. | 934,983 | 1,042,367 |
| Uni-President Enterprises Corporation | 588,424 | 1,024,102 |
| United Microelectronics Corporation | 1,119,401 | 472,352 |
| 16,201,288 | ||
| THAILAND—1.8% | ||
| Delta Electronics PCL Nvdr | 104,500 | 190,058 |
| Electricity Generating PCL | 52,679 | 212,730 |
| Kiatnakin Bank PCL | 169,100 | 221,540 |
| Krung Thai Bank PCL | 1,559,646 | 899,056 |
| PTT Global Chemical PCL | 363,400 | 809,360 |
| Thanachart Capital PCL | 302,000 | 335,142 |
| 2,667,886 | ||
| TURKEY—1.6% | ||
| Eis Eczacibasi Ilac Ve Sinai | 279,198 | 280,326 |
| Enka Ins¸aat ve Sanayi A.S¸. | 84,559 | 252,332 |
| Eregli Demir ve Celik Fabrikalari T.A.S. | 561,594 | 723,842 |
| Gubre Fabrikalari TAS (a) | 101,756 | 179,624 |
| Tekfen Holding A.S. | 94,774 | 215,984 |
| Tofas Turk Otomobil Fabrikasi A.S. | 46,298 | 262,695 |
| Turkiye Sise ve Cam Fabrikalari A.S. | 344,784 | 373,549 |
| 2,288,352 | ||
| TOTAL COMMON STOCK | ||
| (Cost $104,112,347) | 105,620,413 | |
| Preferred Stock—2.3% | ||
| BRAZIL—2.3% | ||
| Banco Bradesco S.A. | 35,889 | 496,266 |
| Banco Estado Rio Gran Pref B | 48,930 | 284,608 |
| Eletropaulo Metropolitana S.A. | 34,480 | 130,699 |
| Itau Unibanco Holding S.A. | 48,519 | 729,205 |
| Itausa-Investimentos Itau S.A. | 290,000 | 1,189,262 |
| Vale S.A., Class A | 44,571 | 560,200 |
| TOTAL PREFERRED STOCK | ||
| (Cost $4,640,871) | 3,390,240 | |
| Exchange Traded Funds—3.1% | ||
| United States—3.1% | ||
iShares MSCI Emerging Markets Index Fund (b) (Cost $4,446,158) | 111,697 | 4,578,460 |
| Mutual Funds—22.4% | ||
| United States—22.4% | ||
Pear Tree PanAgora Risk Parity Emerging Markets Fund* (Cost $32,104,404) | 3,179,734 | 32,910,247 |
Short Term Investments—1.4%
| Par Value | Value | |
| State Street Bank & Trust Co., Repurchase Agreement .0%, 04/01/14, (Dated 03/31/14), Collateralized by 2,185,000 par U.S. Treasury Note-.625% due 11/30/2017, Market Value $2,137,474, Repurchase Proceeds $2,090,917 (Cost $2,090,917) | $2,090,917 | $2,090,917 |
TOTAL INVESTMENTS (EXCLUDING INVESTMENTS PURCHASED WITH CASH COLLATERAL FROM SECURITIES LOANED) (Cost $147,394,697) | 148,590,277 | |
| INVESTMENTS PURCHASED WITH CASH COLLATERAL FROM SECURITIES LOANED—5.0% | ||
| Money Market—5.0% | ||
| Western Asset Institutional Cash Reserves—Inst. | ||
| (Cost $7,428,337) | 7,428,337 | 7,428,337 |
TOTAL INVESTMENTS—105.9% (Cost $154,823,034) | 156,018,614 | |
| OTHER ASSETS & LIABILITIES (Net)—(5.9%) | (8,741,400) | |
| NET ASSETS—100% | $147,277,214 |
| * | Investment in affiliated security. This Fund is advised by Pear Tree Advisors, Inc. which also serves as advisor to Pear Tree PanAgora Dynamic Emerging Markets Fund. |
| (a) | Non-income producing security. |
| (b) | All or a portion of this security was out on loan. |
| (c) | ADR—American Depositary Receipts |
| (d) | GDR—Global Depositary Receipts |
| (e) | At March 31, 2014, the unrealized appreciation of investments based on aggregate cost for federal tax purposes of $155,383,164 was as follows: |
| Aggregate gross unrealized appreciation for all investments in which there is an excess of value over tax cost | $15,692,310 |
| Aggregate gross unrealized depreciation for all investments in which there is an excess of tax cost over value | (15,056,860) |
| Net unrealized appreciation / (depreciation) | $635,450 |
| The percentage of each investment category is calculated as a percentage of net assets. |
SECTOR ALLOCATIONS (as a percentage of Total Net Assets) | |
| Financials | 19.4% |
| Information Technology | 13.4% |
| Energy | 8.9% |
| Consumer Discretionary | 7.9% |
| Materials | 5.7% |
| Industrials | 5.6% |
| Consumer Staples | 5.2% |
| Telecommunication Services | 4.5% |
| Utilities | 2.1% |
| Health Care | 1.3% |
| Exchange Traded Funds | 3.1% |
| Mutual Funds | 22.4% |
| Cash and Other Assets (Net) | 0.5% |
PEAR TREE PANAGORA RISK PARITY EMERGING MARKETS FUND
SCHEDULE OF INVESTMENTS
March 31, 2014
Common Stock—89.5%
| Shares | Value | |
| BRAZIL—4.0% | ||
| América Latina Logística | 10,500 | $35,239 |
| Anhanguera Educacional Participacoes S.A. | 5,000 | 31,034 |
| Banco do Brasil S.A. | 2,400 | 24,260 |
| Banco Santander Brasil S.A. (c) | 2,823 | 15,724 |
| BR Properties S.A. | 3,200 | 26,430 |
| BRF S.A. | 1,300 | 26,108 |
| CCR S.A. | 4,200 | 32,437 |
| Cetip S.A. Mercados Organizados | 2,200 | 26,822 |
| Cielo S.A. | 2,100 | 67,322 |
| Companhia Brasileira de Distribuicao SP (c) | 536 | 23,455 |
| Companhia Energetica de Minas Gerais (c) | 3,801 | 25,847 |
| Companhia Hering | 1,600 | 19,422 |
| Companhia Paranaense de Energia (c) | 1,619 | 21,225 |
| Companhia Siderurgica Nacl (c) | 4,201 | 18,316 |
| Cosan S.A. Industria e Comercio | 2,300 | 35,954 |
| CPFL Energia S.A. (c) | 686 | 11,202 |
| Cyrela Brazil Realty S.A. Empreendimentos e Participacoes | 2,200 | 13,323 |
| EcoRodovias Infraestrutura e Logística S.A. | 5,500 | 33,162 |
| Embraer S.A. (c) | 2,049 | 72,719 |
| Gerdau S.A. (c) | 1,224 | 7,846 |
| Hypermarcas S.A. | 2,800 | 20,371 |
| Kroton Educacional S.A. | 1,300 | 28,759 |
| Localiza Rent a Car S.A. | 2,000 | 29,438 |
| Lojas Americanas S.A. | 9,100 | 57,450 |
| Lojas Renner S.A.. | 1,000 | 28,471 |
| MRV Engenharia | 3,600 | 12,912 |
| Natura Cosméticos S.A. | 1,300 | 21,970 |
| Odontoprev S.A. | 21,500 | 85,977 |
| Petroleo Brasileiro S.A. | 5,700 | 37,805 |
| Porto Seguro S.A. | 2,600 | 36,713 |
| Qualicorp S.A. (a) | 6,100 | 62,066 |
| Raia Drogasil S.A. | 6,600 | 57,438 |
| Souza Cruz S.A. | 2,100 | 19,179 |
| Telefonica Brasil S.A. (c) | 3,869 | 82,178 |
| TIM Participacoes S.A. (c) | 2,643 | 68,612 |
| Totvs S.A. | 4,100 | 64,710 |
| Ultrapar Participacoes S.A. | 1,200 | 29,213 |
| Vale S.A. | 1,200 | 16,716 |
| Weg S.A. | 2,300 | 32,324 |
1,360,149 | ||
| CHILE—5.6% | ||
| AES Gener S.A. | 101,600 | 56,078 |
| Aguas Andinas S.A. | 138,946 | 86,732 |
| Banco de Chile | 450,553 | 56,608 |
| Banco de Crédito e Inversiones | 993 | 57,673 |
| Banco Santander Chile (c) | 3,019 | 70,765 |
| CAP S.A. | 4,814 | 77,702 |
| Cencosud S.A. | 18,190 | 60,075 |
| Colbun S.A. | 329,877 | 81,095 |
| Compania Cervecerias Unidas S.A. (c) | 4,663 | 104,358 |
| Corpbanca S.A. (c) | 5,000 | 88,250 |
| Edelnor S.A. | 54,445 | 73,150 |
| Empresa Nacional de Electricidad S.A. (c) | 1,685 | 72,758 |
| Empresa Nacional de Telecomunicaciones S.A. | 19,694 | 240,179 |
| Empresas CMPC S.A. | 41,906 | 95,944 |
| Empresas Copec S.A. | 9,294 | 121,327 |
| Enersis S.A. (c) | 5,367 | 83,350 |
| LATAM Airlines Group S.A. | 8,823 | 133,264 |
| Quimica y Minera de Chile S.A. (c) | 3,210 | 101,885 |
| S.A.C.I. Falabella | 15,447 | 135,939 |
| Vina Concha y Toro S.A. | 44,985 | 92,294 |
| 1,889,426 | ||
| CHINA—4.5% | ||
| Aluminum Corporation of China Limited H Shares (a)(b) | 114,000 | 39,241 |
| Anhui Conch Cement Company Limited H | 5,000 | 21,465 |
| Bank of Communications Co., Ltd. H | 32,000 | 20,916 |
| BBMG Corporation H | 30,000 | 23,399 |
| Beijing Capital International Airport Co., Ltd. H | 34,000 | 23,188 |
| Beijing Enterprises Holdings Limited | 2,500 | 22,400 |
| Belle International Holdings Limited | 18,000 | 17,845 |
| Brilliance China Automotive Holdings, Ltd. | 8,000 | 12,253 |
| China Agri-Industries Holdings Limited | 45,000 | 17,520 |
| China BlueChemical Ltd. H | 50,000 | 25,720 |
| China Coal Energy Co., Ltd. (b) | 39,000 | 22,022 |
| China Communications Construction Co., Ltd., Class H | 15,000 | 10,462 |
| China Communications Services Corporation Ltd. H | 106,000 | 49,059 |
| China Construction Bank Corporation | 37,000 | 25,901 |
| China International Marine Containers Group Co., Ltd. H | 8,400 | 19,428 |
| China Longyuan Power Group H | 33,000 | 33,227 |
| China National Building Material Co., Ltd. H | 16,000 | 16,048 |
| China Oilfield Services Limited H | 8,000 | 18,791 |
| China Petroleum & Chemical Corporation | 52,000 | 46,659 |
| China Shenhua Energy Co., Ltd. | 9,500 | 27,434 |
| China Shipping Container Lines Co., Ltd. H (a) | 42,000 | 9,530 |
| China Taiping Insurance Holdings Co., Ltd. (a) | 15,200 | 27,199 |
| China Telecom Corporation Limited | 178,000 | 82,382 |
| CITIC Pacific Ltd. (b) | 29,000 | 51,295 |
| CSR Corporation Ltd. H Shares | 20,000 | 16,811 |
| Datang International Power Generation Co., Ltd. | 106,000 | 38,673 |
| ENN Energy Holdings Ltd. | 4,000 | 27,924 |
| Fosun International | 33,000 | 41,437 |
| Haitian International Holdings Ltd. | 16,000 | 32,096 |
| Huaneng Power International Inc. H | 42,000 | 40,068 |
| Inner Mongolia Yitai Coal Co., Ltd., Class B | 10,000 | 12,090 |
| Jiangsu Expressway Co. Ltd.—H | 20,000 | 22,819 |
| Jiangxi Copper Company Limited | 5,000 | 8,406 |
| Kingboard Chemical Holdings, Ltd. | 12,500 | 24,398 |
| PetroChina Company Limited (c) | 279 | 30,272 |
| Shandong Weigao Group Medical Polymer Co., Ltd. | 36,000 | 40,981 |
| Shanghai Electric Group Company Ltd. H | 38,000 | 13,472 |
| Shanghai Pharmaceuticals Holding Co., Ltd. | 27,700 | 62,637 |
| Shenzhou International Group | 6,000 | 19,067 |
| Sino Biopharmaceutical Limited | 40,000 | 34,035 |
| Sino-Ocean Land Holdings Ltd. | 49,000 | 26,721 |
| Sinopec Shanghai Petrochemical Co., Ltd. | 101,000 | 25,912 |
| Sinopharm Group Co., Ltd. H | 19,600 | 53,695 |
| Tencent Holdings Limited | 400 | 27,821 |
| Tingyi (Cayman Islands) Holding Corporation | 10,000 | 28,749 |
| Tsingtao Brewery Co., Ltd. | 4,000 | 29,342 |
| Uni-President China Holdings Limited | 17,000 | 14,268 |
| Wumart Stores, Inc. H | 10,000 | 9,682 |
| Yantai Changyu Pioneer Wine Company Ltd.—B | 8,100 | 19,715 |
| Yanzhou Coal Mining Company Limited (b) | 62,000 | 46,839 |
| Zhejiang Expressway Co., Ltd. | 20,000 | 18,229 |
| Zhongsheng Group Holdings Ltd. | 21,500 | 29,713 |
| ZTE Corporation H (a) | 20,800 | 40,384 |
| 1,499,640 | ||
| COLOMBIA—3.7% | ||
| Almacenes Exito S.A. | 15,334 | 230,987 |
| Bancolombia S.A.. | 4,821 | 65,918 |
| Cementos Argos S.A. | 16,621 | 85,032 |
| CEMEX Latam Holdings, S.A. (a) | 10,385 | 86,546 |
| Corporacion Financiera Colombiana S.A. | 3,262 | 61,985 |
| Ecopetrol S.A. | 90,726 | 185,569 |
| Grupo Argos S.A. | 6,827 | 71,655 |
| Grupo de Inversiones Suramericana S.A. | 3,709 | 68,710 |
| Interconexión Electrica S.A. | 39,188 | 174,827 |
| Isagen S.A. E.S.P. | 122,625 | 201,025 |
| 1,232,254 | ||
| CZECH REPUBLIC—0.6% | ||
| CEZ A.S. | 3,637 | 104,245 |
| Komercni Banka A.S. | 229 | 54,716 |
| Telefónica Czech Republic, A.S. | 3,833 | 57,529 |
| 216,490 | ||
| EGYPT—1.4% | ||
| Commercial International Bank | 20,421 | 106,245 |
| Global Telecom Holding S.A.E. (a)(d) | 19,939 | 66,158 |
| Global Telecom Holding S.A.E. (a)(d) | 11,282 | 37,434 |
| Talaat Moustafa Group (TMG) Holding (a) | 99,296 | 111,161 |
| Telecom Egypt SAE | 64,627 | 158,519 |
| 479,517 | ||
| GREECE—1.6% | ||
| Alpha Bank A.E. (a) | 35,657 | 35,123 |
| Folli-Follie S.A. (a) | 1,300 | 47,997 |
| Hellenic Petroleum S.A. | 11,920 | 119,385 |
| Hellenic Telecommunication Organization S.A. (a) | 2,928 | 48,405 |
| Jumbo S.A. (a) | 3,136 | 56,164 |
| National Bank of Greece (a) | 4,963 | 26,939 |
| Opap S.A. | 3,600 | 58,027 |
| Public Power Corporation S.A. | 3,500 | 57,861 |
| Titan Cement Company S.A. (a) | 2,300 | 80,451 |
| 530,352 | ||
| HONG KONG—2.3% | ||
| AAC Technologies Holdings Inc. | 9,000 | 46,759 |
| ANTA Sports Products, Ltd. (b) | 12,000 | 20,050 |
| Beijing Enterprises Water Group Limited | 48,000 | 33,602 |
| China Gas Holdings Ltd. | 20,000 | 31,250 |
| China Merchants Holdings International Co., Ltd. | 6,000 | 20,653 |
| China Mobile Limited | 5,000 | 45,767 |
| China Resources Cement Holdings Limited | 66,000 | 51,988 |
| China Resources Enterprise | 8,000 | 22,587 |
| China Resources Gas Group Limited | 12,000 | 38,135 |
| China Resources Power Holdings Co., Ltd. | 12,000 | 31,250 |
| China Unicom (Hong Kong) Limited (c) | 5,202 | 68,458 |
| CNOOC Limited (c) | 169 | 25,656 |
| GCL-Poly Energy Holdings Ltd. (a) | 70,000 | 25,268 |
| Golden Eagle Retail Group Ltd. | 13,000 | 17,933 |
| Guangdong Investment Limited | 48,000 | 46,102 |
| Hanergy Solar Group Limited (a) | 90,000 | 14,156 |
| Hengan International Group Co., Ltd. | 2,500 | 25,961 |
| Lee & Man Paper Manufacturing Ltd. | 47,000 | 29,206 |
| Lenovo Group Limited | 26,000 | 28,558 |
| Sihuan Pharmaceutical Holdings Group Ltd. | 38,000 | 45,756 |
| Sun Art Retail Group Ltd. | 33,500 | 42,238 |
| Want Want China Holdings Limited | 29,000 | 43,144 |
| Yingde Gases Group Co., Ltd. | 25,500 | 24,261 |
| 778,738 | ||
| HUNGARY—0.7% | ||
| Magyar Telekom Telecommunications PLC | 17,960 | 24,402 |
| MOL Hungarian Oil an Gas Nyrt. | 806 | 45,357 |
| OTP Bank Nyrt. | 4,444 | 85,128 |
| Richter Gedeon Nyrt | 3,883 | 67,731 |
| 222,618 | ||
| INDONESIA—6.6% | ||
| PT Adaro Energy Tbk | 981,700 | 84,689 |
| PT Astra Agro Lestari Tbk | 30,500 | 69,806 |
| PT Astra International Tbk | 97,000 | 62,973 |
| PT Bank Central Asia Tbk | 29,000 | 27,060 |
| PT Bank Danamon Indonesia Tbk | 97,500 | 37,335 |
| PT Bank Mandiri Tbk | 43,000 | 35,770 |
| PT Bank Negara Indonesia (Persero) Tbk | 63,500 | 27,726 |
| PT Bank Rakyat Indonesia Tbk (a) | 36,000 | 30,343 |
| PT Bumi Serpong Damai Tbk | 306,000 | 44,041 |
| PT Charoen Pokphand Indonesia Tbk | 136,000 | 47,828 |
| PT Global Mediacom Tbk | 279,100 | 57,736 |
| PT Gudang Garam Tbk | 15,000 | 65,229 |
| PT Indo Tambangraya Megah Tbk | 38,500 | 82,524 |
| PT Indocement Tunggal Prakarsa Tbk | 52,500 | 108,027 |
| PT Indofood CBP Sukses Makmur Tbk | 54,500 | 48,455 |
| PT Indofood Sukses Makmur Tbk | 84,000 | 53,979 |
| PT Jasa Marga (Persero) Tbk | 249,500 | 131,778 |
| PT Kalbe Farma Tbk | 1,175,000 | 151,530 |
| PT Lippo Karawaci Tbk | 584,600 | 55,836 |
| PT Matahari Department Store Tbk (a) | 44,000 | 53,838 |
| PT Media Nusantara Citra Tbk | 224,300 | 51,929 |
| PT Perusahaan Gas Negara (Persero) Tbk | 351,300 | 158,487 |
| PT Semen Indonesia (Persero) Tbk | 72,500 | 100,836 |
| PT Surya Citra Media Tbk | 236,200 | 66,535 |
| PT Tambang Batubara Bukit Asam (Persero) Tbk | 103,300 | 84,795 |
| PT Telekomunikasi Indonesia Tbk (c) | 2,884 | 113,543 |
| PT Unilever Indonesia Tbk | 27,500 | 70,808 |
| PT United Tractors Tbk | 62,000 | 113,248 |
| PT XL Axiata Tbk | 248,900 | 96,405 |
| Tower Bersama Infrastructure | 155,500 | 82,130 |
| 2,215,219 | ||
| MALAYSIA—9.6% | ||
| AirAsia Berhad | 48,900 | 38,186 |
| Alliance Financial Group Berhad | 35,600 | 48,077 |
| AMMB Holdings Berhad | 14,900 | 32,761 |
| Astro Malaysia Holdings Berhad | 74,100 | 72,614 |
| Axiata Group Berhad | 50,200 | 102,537 |
| Berjaya Sports Toto Berhad | 89,500 | 108,809 |
| British American Tobacco (Malaysia) Berhad | 3,700 | 66,986 |
| Bumi Armada Berhad | 79,700 | 95,430 |
| CIMB Group Holdings Berhad | 19,100 | 41,821 |
| Dialog Group Berhad | 34,800 | 38,258 |
| DiGi.Com Berhad | 69,100 | 114,056 |
| Felda Global Ventures Holdings Berhad | 70,900 | 100,960 |
| Gamuda Berhad | 33,700 | 48,607 |
| Genting Berhad | 17,200 | 52,672 |
| Genting Malaysia Berhad | 38,100 | 49,003 |
| Genting Plantation Berhad | 26,400 | 87,313 |
| Hong Leong Bank Berhad | 16,000 | 69,282 |
| Hong Leong Financial Group Berhad | 7,700 | 36,973 |
| IHH Healthcare Berhad (a) | 182,600 | 215,284 |
| IJM Corporation Berhad | 20,600 | 38,733 |
| IOI Corporation Berhad | 49,900 | 73,349 |
| IOI Properties Group Berhad (a) | 60,000 | 48,875 |
| Kuala Lumpur Kepong Berhad | 11,900 | 88,189 |
| Malayan Banking Berhad | 19,200 | 56,915 |
| Malaysia Airports Holdings Berhad | 18,700 | 45,812 |
| Maxis Berhad | 59,900 | 127,669 |
| MISC Berhad (a) | 25,600 | 54,093 |
| MMC Corporation Berhad | 59,800 | 51,642 |
| Parkson Holdings Berhad | 87,900 | 80,753 |
| Petronas Chemicals Group Berhad | 58,600 | 124,001 |
| Petronas Dagangan Berhad | 13,300 | 125,038 |
| Petronas Gas Berhad | 11,700 | 85,273 |
| PPB Group Berhad | 13,300 | 67,691 |
| Public Bank Berhad | 10,400 | 61,148 |
| RHB Capital Berhad | 15,900 | 40,998 |
| SapuraKencana Petroleum Berhad (a) | 50,200 | 69,178 |
| Sime Darby Berhad | 24,800 | 70,705 |
| Telekom Malaysia Berhad | 81,900 | 147,723 |
| Tenaga Nasional Berhad | 29,100 | 106,580 |
| UEM Sunrise Berhad | 40,200 | 27,083 |
| UMW Holdings Berhad | 18,500 | 62,205 |
| YTL Corporation Berhad | 207,100 | 97,034 |
| YTL Power International Berhad (a) | 176,400 | 84,810 |
| 3,255,126 | ||
| MEXICO—6.5% | ||
| Alfa S.A.B. de C.V., Series A | 26,800 | 67,731 |
| America Movil S.A.B. Series L (c) | 9,702 | 192,876 |
| Arca Continental S.A.B. de C.V. | 8,500 | 50,704 |
| Cemex S.A.B. CPO (a) | 34,500 | 43,728 |
| Coca-Cola FEMSA SAB de C.V. (c) | 744 | 78,507 |
| Compartamos, S.A.B de C.V. | 46,700 | 85,407 |
| Controladora Comercial Mexicana S.A. de C.V. | 11,600 | 48,106 |
| El Puerto de Liverpool S.A.B. de C.V. | 14,500 | 159,120 |
| Fibra Uno Administracion S.A. de C.V. | 27,484 | 88,909 |
| Fomento Economico Mexicano S.A.B. (c) | 514 | 47,925 |
| Genomma Lab Internacional SAB de C.V. (a) | 58,400 | 150,232 |
| Grupo Aeroportuario del Pacifico S.A.B. (c) | 1,395 | 81,594 |
| Grupo Aeroportuario del Sureste, S. A. B. de C.V., Series B | 4,900 | 60,177 |
| Grupo Bimbo, S.A. de C.V. | 17,700 | 47,729 |
| Grupo Carso SAB de C.V., Series A1 | 11,600 | 60,854 |
| Grupo Comercial Chedraui S.A. de C.V | 21,800 | 64,110 |
| Grupo Financiero Banorte SAB de C.V. | 13,200 | 89,253 |
| Grupo Financiero Inbursa SAB de C.V. | 31,100 | 80,337 |
| Grupo Mexico S.A.B. de C.V., Series B | 17,500 | 55,217 |
| Grupo Televisa S.A.B. (c) | 3,723 | 123,939 |
| Industrias CH SAB de C.V. Series B (a) | 8,100 | 44,918 |
| Industrias Penoles SAB de C.V. | 1,585 | 41,285 |
| Kimberly-Clark de Mexico S.A. de C.V., Class A | 13,400 | 35,764 |
| Mexichem SAB de C.V. | 21,900 | 77,151 |
| Minera Frisco S.A.B. De C.V. (a) | 32,600 | 63,440 |
| OHL Mexico, S.A.B. de C.V. (a) | 23,200 | 60,161 |
| Promotora Y Operadora de Infraestructura, S.A.B. de C.V. (a) | 4,300 | 57,751 |
| Santander Mexico SAB de C.V. | 26,300 | 64,453 |
| Wal-Mart de Mexico, S.A.B. de C.V. | 30,500 | 72,644 |
| 2,194,022 | ||
| PERU—0.8% | ||
| Companhia de Minas Buenaventura S.A. (c) | 5,026 | 63,177 |
| Credicorp Ltd. | 934 | 128,817 |
| Southern Copper Corporation | 2,600 | 75,686 |
| 267,680 | ||
| PHILIPPINES—5.0% | ||
| Aboitiz Equity Ventures, Inc. | 69,300 | 86,538 |
| Aboitiz Power Corporation | 169,700 | 140,770 |
| Alliance Global Group, Inc. | 94,700 | 60,184 |
| Ayala Corporation | 4,530 | 58,386 |
| Ayala Land Inc. | 88,100 | 58,740 |
| Bank of the Philippine Islands | 22,966 | 43,991 |
| BDO Unibank, Inc. | 31,060 | 58,872 |
| DMCI Holdings, Inc. | 43,630 | 68,103 |
| Energy Development Corporation | 980,600 | 123,764 |
| Globe Telecom, Inc. | 3,885 | 144,155 |
| International Container Terminal Services, Inc. | 29,630 | 71,358 |
| JG Summit Holdings, Inc. | 58,100 | 64,131 |
| Jollibee Foods Corporation | 56,830 | 216,700 |
| Metro Pacific Investments Corporation | 494,400 | 52,147 |
| Metropolitan Bank & Trust Company (a) | 26,795 | 46,187 |
| Philippine Long Distance Telephone Company (c) | 2,016 | 123,016 |
| SM Investments Corporation | 2,988 | 46,974 |
| SM Prime Holdings, Inc. | 144,100 | 46,914 |
| Universal Robina Corporation | 54,990 | 174,124 |
| 1,685,054 | ||
| POLAND—3.8% | ||
| Alior Bank S.A. (a) | 1,051 | 30,459 |
| Bank Handlowy w Warszawie S.A. | 979 | 36,719 |
| Bank Pekao S.A. | 612 | 39,760 |
| Bank Zachodni WBK S.A. | 285 | 38,896 |
| Mbank | 215 | 38,294 |
| Cyfrowy Polsat S.A. (a) | 13,565 | 95,838 |
| ENEA S.A. | 14,609 | 77,241 |
| Eurocash S.A. | 5,719 | 75,575 |
| Grupa Azoty S.A. | 3,322 | 66,415 |
| Grupa LOTOS S.A. (a) | 4,566 | 57,321 |
Jastrzębska Spółka Węglowa S.A. | 3,349 | 50,708 |
| Kernel Holding S.A. (a) | 9,649 | 93,297 |
| KGHM Polska Miedz S.A. | 2,134 | 76,795 |
| PGE S.A. | 13,573 | 84,771 |
| PKO Bank Polski S.A. | 2,502 | 35,122 |
| Polski Koncern Naftowy ORLEN S.A. | 4,217 | 60,228 |
| Polskie Gornictwo Naftowe i Gazownictwo S.A. | 37,217 | 54,605 |
| PZU S.A. | 282 | 40,024 |
| Synthos S.A. | 22,727 | 36,650 |
| Tauron Polska Energia S.A. | 42,350 | 73,472 |
| Orange Polska S.A. | 33,837 | 115,729 |
| 1,277,919 | ||
| RUSSIA—3.8% | ||
| Federal Grid Company of Unified Energy System JSC | 44,830,000 | 98,065 |
| Gazprom (c) | 6,681 | 51,444 |
| LUKoil (c) | 529 | 29,391 |
| Magnit OJSC (Reg S) (d) | 1,495 | 81,926 |
| Magnit OJSC (Reg S) (d) | 1,326 | 72,665 |
| MegaFon (d) | 1,224 | 34,456 |
| MegaFon (d) | 890 | 25,053 |
| Mobile TeleSystems (c) | 4,259 | 74,490 |
| Moscow Exchange MICEX-RTS | 52,480 | 86,047 |
| Norilsk Nickel Mining and Metallurgical Co. (c) | 3,515 | 58,454 |
| NovaTek OAO (Reg S) (d) | 70 | 7,700 |
| NovaTek OAO (Reg S) (d) | 229 | 25,190 |
| OAO Rostelecom* | 28,390 | 70,005 |
| OAO Severstal (Reg S) (d) | 767 | 5,806 |
| OC Rosneft OJSC (Reg S) (d) | 4,080 | 27,169 |
| OC Rosneft OJSC (Reg S) (d) | 1,720 | 11,453 |
| RusHydro JSC | 2,748,000 | 43,690 |
| RusHydro Management Co. (c) | 34,005 | 52,062 |
| Sberbank | 23,230 | 55,201 |
| Severstal (b)(d) | 9,119 | 69,031 |
| Sistema JSFC (Reg S) (d) | 1,952 | 43,940 |
| Sistema JSFC (Reg S) (d) | 1,108 | 24,941 |
| Surgutneftegas OJSC (c) | 3,998 | 29,105 |
| Surgutneftegaz (c) | 788 | 5,808 |
| Tatneft (c) | 1,220 | 41,797 |
| Uralkali OJSC | 16,380 | 78,117 |
| VTB Bank OJSC | 72,030,000 | 80,789 |
| 1,283,795 | ||
| SOUTH AFRICA—6.0% | ||
| African Bank Investments Limited (b) | 13,328 | 13,607 |
| Aspen Pharmacare Holdings Limited | 2,605 | 69,592 |
| Assore Ltd. | 742 | 28,750 |
| Barloworld Limited | 5,662 | 59,294 |
| Bidvest Group Limited | 2,438 | 64,461 |
| Discovery Ltd. | 1,769 | 14,174 |
| Exxaro Resources Ltd. | 6,789 | 90,264 |
| Foschini Limited | 4,520 | 45,995 |
| Gold Fields Limited | 3,713 | 14,292 |
| Gold Fields Ltd. (c) | 4,490 | 16,568 |
| Growthpoint Properties Limited | 21,002 | 48,667 |
| Harmony Gold Mining Co., Ltd. (a)(c) | 9,449 | 28,819 |
| Impala Platinum Holdings Limited | 2,939 | 33,494 |
| Imperial Holdings Limited | 1,494 | 26,745 |
| Investec Ltd. | 4,159 | 33,510 |
| Kumba Iron Ore Limited | 507 | 18,200 |
| Life Healthcare Group Holdings Ltd. | 20,143 | 73,668 |
| Massmart Holdings Ltd. | 4,531 | 59,167 |
| Mediclinic International, Ltd. | 9,731 | 69,154 |
| MMI Holdings Ltd. | 13,440 | 31,399 |
| Mr Price Group Ltd. | 4,785 | 71,531 |
| MTN Group Limited | 3,432 | 70,255 |
| Nampak Ltd. | 7,606 | 25,968 |
| Naspers Limited N Shs | 446 | 49,190 |
| Netcare Limited | 27,555 | 61,078 |
| Northam Platinum, Ltd. (a) | 9,967 | 36,849 |
| Pick n Pay Stores Ltd. | 10,396 | 50,944 |
| PPC, Ltd. | 8,454 | 23,476 |
| Redefine Properties Ltd. | 26,601 | 24,126 |
| Remgro Limited | 1,906 | 37,096 |
| Reunert Limited | 15,032 | 92,079 |
| Sanlam Limited | 7,618 | 41,629 |
| Sappi Ltd. (a) | 8,232 | 28,926 |
| Sasol Ltd. | 1,809 | 101,288 |
| Shoprite Holdings Ltd. | 3,148 | 47,595 |
| Spar Group Limited (The) | 5,801 | 66,947 |
| Steinoff International Holdings Limited | 14,100 | 68,292 |
| Tiger Brands Limited | 2,360 | 61,023 |
| Truworths International Ltd. | 6,076 | 44,576 |
| Vodacom Group (Proprietary) Limited | 8,778 | 108,365 |
| Woolworths Holdings Limited | 11,128 | 77,549 |
| 2,028,602 | ||
| SOUTH KOREA—5.2% | ||
| Amore Pacific Corporation | 25 | 29,593 |
| Amorepacific Group | 56 | 26,936 |
| BS Financial Group, Inc. | 1,490 | 21,067 |
| Celltrion Inc. (a)(b) | 1,686 | 69,692 |
| Cheil Industries Inc. | 853 | 57,457 |
| CJ CheilJedang Corp. | 116 | 31,276 |
| Daewoo International Corporation (a) | 420 | 15,270 |
| Daewoo Securities Co., Ltd. | 1,770 | 13,635 |
| DGB Financial Group Inc. | 1,410 | 20,399 |
| E-MART Co., Ltd. | 102 | 23,381 |
| GS Holdings Corp. | 1,490 | 67,470 |
| Hana Financial Group, Inc. | 490 | 17,907 |
| Hankook Tire Co. Ltd. | 714 | 40,514 |
| Hanwha Corporation | 600 | 18,094 |
| Hanwha Life Insurance Co., Ltd. | 2,670 | 17,508 |
| Hyosung Corporation | 364 | 26,263 |
| Hyundai Mobis Co., Ltd. | 73 | 21,603 |
| Hyundai Securities Co., Ltd. | 7,270 | 44,121 |
| Hyundai Steel Co., Ltd. | 364 | 23,527 |
| Hyundai Wia Corp. | 222 | 35,663 |
| Industrial Bank of Korea | 1,890 | 23,970 |
| Kangwon Land Inc. | 980 | 28,541 |
| KB Financial Group Inc. | 840 | 29,395 |
| Korea Aerospace Industries, Ltd. | 290 | 9,249 |
| Korea Electric Power Corporation | 1,830 | 62,665 |
| Korea Gas Corporation | 863 | 50,428 |
| Korea Kumho Petrochemical Co., Ltd. | 115 | 9,486 |
| Korea Zinc Co., Ltd. | 64 | 19,871 |
| KT Corporation (a)(c) | 7,023 | 97,549 |
| KT&G Corporation | 320 | 24,050 |
| LG Chem Ltd. | 141 | 33,646 |
| LG Display Co., Ltd. (a) | 800 | 20,029 |
| LG Household & Healthcare | 45 | 19,426 |
| LG Innotek Co., Ltd. (a) | 149 | 14,418 |
| LG Uplus Corp. | 6,740 | 66,168 |
| Lotte Chemical Corporation | 190 | 33,557 |
| Lotte Confectionery Co. Ltd. | 13 | 22,264 |
| Lotte Shopping Co., Ltd. | 52 | 16,365 |
| Naver Corp. | 43 | 31,267 |
| NCSoft Corporation | 106 | 21,709 |
| NHN Entertainment Corporation (a) | 159 | 14,340 |
| Orion Corporation | 42 | 32,315 |
| Samsung Card Co, Ltd. | 420 | 13,672 |
| Samsung Electro-Mechanics Co., Ltd. | 282 | 18,359 |
| Samsung Electronics Company, Ltd. | 14 | 17,664 |
| Samsung Fire & Marine Insurance Co., Ltd. | 74 | 16,650 |
| Samsung Life Insurance Co., Ltd | 183 | 17,278 |
| Samsung SDI Company, Ltd. | 161 | 24,352 |
| Samsung Securities Co., Ltd. | 380 | 13,941 |
| Shinhan Financial Group Co., Ltd. | 600 | 26,493 |
| Shinsegae Co., Ltd. | 84 | 18,190 |
| SK C&C Co., Ltd. | 221 | 31,039 |
| SK Hynix Inc. (a) | 700 | 23,674 |
| SK Innovation Co., Ltd. | 383 | 43,897 |
| SK Telecom Co., Ltd. (c) | 2,365 | 53,378 |
| S-Oil Corp. | 483 | 27,951 |
| Woori Finance Holdings Co., Ltd. (a) | 2,990 | 33,988 |
| Yuhan Co., Ltd. | 504 | 85,937 |
| 1,768,547 | ||
| TAIWAN—7.0% | ||
| Asia Cement Corporation | 20,400 | 25,456 |
| Asia Pacific Telecom Co., Ltd. | 111,000 | 52,124 |
| AU Optronics Corp. (a)(c) | 7,122 | 24,785 |
| Cathay Financial Holding Co., Ltd. | 12,813 | 18,681 |
| Chang Hwa Commercial Bank | 35,310 | 20,929 |
| Cheng Shin Rubber Industry Co., Ltd. | 6,900 | 19,690 |
| China Airlines Ltd. (a) | 74,000 | 24,422 |
| China Life Insurance Co,. Limited | 34,000 | 31,206 |
| China Motor Corporation | 22,000 | 19,650 |
| China Petrochemical Development Corporation | 48,000 | 19,860 |
| China Steel Corporation | 40,400 | 34,029 |
| Chinatrust Financial Holding Co., Ltd. | 26,750 | 16,734 |
| Chunghwa Telecom Co., Ltd. (c) | 5,852 | 179,539 |
| CTCI Corporation | 22,000 | 32,979 |
| Eclat Textile Co., Ltd. | 1,000 | 11,559 |
| EVA Airways Corporation (a) | 46,000 | 23,111 |
| Evergreen Marine Corporation (a) | 46,000 | 26,888 |
| Far Eastern Department Stores Ltd. | 36,000 | 31,741 |
| Far Eastern New Century Corporation | 42,420 | 45,063 |
| Far EasTone Telecommunications Co., Ltd. | 54,000 | 114,375 |
| Farglory Land Development Co., Ltd. | 7,000 | 11,930 |
| Feng Hsin Iron & Steel Co., Ltd. | 21,000 | 35,307 |
| Formosa Chemicals & Fiber Corporation | 11,330 | 27,383 |
| Formosa International Hotels Corporation | 2,200 | 26,080 |
| Formosa Petrochemical Corporation | 55,000 | 139,972 |
| Formosa Plastics Corporation | 12,480 | 31,228 |
| Formosa Taffeta Co., Ltd. | 32,000 | 35,728 |
| Fubon Financial Holding Co., Ltd. | 14,000 | 18,987 |
| Giant Manufacturing Co., Ltd. | 4,000 | 27,190 |
| Highwealth Construction Corp. | 14,000 | 33,009 |
| HIWIN Technologies Corp. | 3,000 | 29,062 |
| Hotai Motor Co., Ltd. | 2,000 | 24,169 |
| Hua Nan Financial Holdings Co., Ltd. | 38,850 | 22,007 |
| LCY Chemical Corp. | 23,000 | 26,812 |
| Lite-On Technology Corp. | 15,000 | 22,363 |
| Mega Financial Holding Co., Ltd. | 23,751 | 18,406 |
| Merida Industry Co., Ltd. | 3,000 | 19,900 |
| Nan Ya Plastics Corporation | 10,100 | 21,392 |
| Nankang Rubber Tire Corp., Ltd. (a) | 17,000 | 20,655 |
| Pou Chen Corporation | 21,000 | 29,618 |
| President Chain Store Corp. | 17,000 | 120,023 |
| Ruentex Development Company Limited | 23,000 | 42,069 |
| Ruentex Industries Ltd. | 9,000 | 21,516 |
| ScinoPharm Taiwan Ltd. | 40,080 | 107,135 |
| Standard Foods Corporation | 36,950 | 100,709 |
| Taishin Financial Holding Co., Ltd. | 38,118 | 17,274 |
| Taiwan Business Bank Co., Ltd. (a) | 63,440 | 18,728 |
| Taiwan Cement Corporation | 16,000 | 24,694 |
| Taiwan Cooperative Financial Holding Co., Ltd. | 49,820 | 26,667 |
| Taiwan Fertilizer Co., Ltd. | 10,000 | 20,951 |
| Taiwan Glass Industry Corporation | 43,000 | 41,443 |
| Taiwan Mobile Co., Ltd. | 34,000 | 106,514 |
| TECO Electric & Machinery Co., Ltd. | 25,000 | 27,871 |
| TSRC Corp. | 24,000 | 35,859 |
| U-Ming Marine Transport Corporation | 19,000 | 32,132 |
| Uni-President Enterprises Corporation | 65,620 | 114,206 |
| Walsin Lihwa Corporation (a) | 69,000 | 21,956 |
| Wan Hai Lines, Ltd. | 64,000 | 30,894 |
| Yang Ming Marine Transport Corporation (a) | 63,000 | 26,481 |
| Yuanta Financial Holding Co., Ltd. | 32,000 | 16,130 |
| Yulon Motor Co., Ltd. | 12,000 | 19,821 |
| 2,367,092 | ||
| THAILAND—5.8% | ||
| Advanced Info Service For Rg | 20,900 | 145,604 |
| Airports of Thailand PCL | 15,400 | 92,096 |
| Bangkok Bank PCL (e) | 7,700 | 42,369 |
| Bangkok Dusit Medical Services F | 48,300 | 198,024 |
| Banpu Public Company Limited | 52,000 | 44,883 |
| BEC World PCL | 44,000 | 73,921 |
| BTS Group Holdings PCL | 399,300 | 103,395 |
| Central Pattana PCL | 35,600 | 51,578 |
| Charoen Pokphand Foods PCL | 106,100 | 91,578 |
| CP ALL PCL | 82,600 | 110,762 |
| Glow Energy PCL | 78,000 | 182,737 |
| Home Product Center PCL | 217,233 | 65,291 |
| Indorama Ventures Public Company Limited | 85,500 | 60,356 |
| IRPC PCL | 501,100 | 53,138 |
| Kasikornbank PCL (e) | 10,400 | 57,065 |
| Krung Thai Bank PCL | 72,200 | 41,620 |
| Minor International PCL | 100,900 | 77,137 |
| PTT Exploration & Production PCL | 16,300 | 78,887 |
| PTT Global Chemical PCL | 28,700 | 63,920 |
| PTT PCL | 7,100 | 65,441 |
| Siam Cement Pub Co-for Reg | 2,700 | 34,790 |
| Siam Cement Public Company (e) | 4,700 | 60,561 |
| Siam Commercial Bank PCL | 11,300 | 54,863 |
| Thai Oil PCL | 25,300 | 41,335 |
| True Corp PCL (a)(b) | 368,100 | 78,295 |
| 1,969,646 | ||
| TURKEY—5.0% | ||
| Akbank T.A.S. | 11,515 | 36,567 |
| Anadolu Efes Biracilik VE | 5,613 | 62,386 |
| Arcelik A.S. | 12,843 | 71,672 |
| BIM Birlesik Magazalar A.S. | 2,987 | 67,235 |
| Coca-Cola Icecek A.S. | 2,848 | 68,495 |
| Emlak Konut Gayrimenkul Yatirim Ortakligi A.S. | 24,832 | 29,223 |
| Enka Ins¸aat ve Sanayi A.S¸. | 15,390 | 45,925 |
| Eregli Demir ve Celik Fabrikalari T.A.S. | 97,943 | 126,239 |
| Ford Otomotiv Sanayi A.S. | 7,874 | 80,345 |
| Haci Omer Sabanci Holding A.S. | 8,284 | 32,109 |
| Koc¸ Holding A.S. | 15,061 | 63,441 |
| Koza Altin Isletmeleri A.S. | 9,145 | 79,221 |
| TAV Havalimanlari Holding A.S. | 6,269 | 50,355 |
| Tofas Turk Otomobil Fabrikasi A.S. | 12,079 | 68,536 |
| Tupras—Turkiye Petrol Rafinerileri A.S. | 7,476 | 158,154 |
| Turk Hava Yollari A.O. | 18,791 | 57,829 |
| Turk Telekomunikasyon A.S. | 37,251 | 103,506 |
| Turkcell Iletisim Hizmetleri A.S. (a)(c) | 7,788 | 107,241 |
| Turkiye Garanti Bankasi A.S. | 14,688 | 50,210 |
| Turkiye Halk Bankasi A.S. | 7,655 | 47,367 |
| Turkiye Is Bankasi A.S. | 23,422 | 51,955 |
| Turkiye Sise ve Cam Fabrikalari A.S. | 55,982 | 60,653 |
| Turkiye Vakiflar Bankasi T-d | 23,315 | 43,987 |
| Ulker Biskuvi Sanayi A.S. | 9,174 | 64,477 |
| Yapi ve Kredi Bankasi A.S. | 25,729 | 48,782 |
| 1,675,910 | ||
| TOTAL COMMON STOCK | ||
| (Cost $29,403,266) | 30,197,796 | |
| Preferred Stock—2.8% | ||
| BRAZIL—0.9% | ||
| AES Tiete S.A. | 2,800 | 22,394 |
| Banco Bradesco S.A. | 3,100 | 42,866 |
| Centrais Eletricas Brasileiras S.A. | 3,900 | 18,812 |
| Itausa-Investimentos Itau S.A. | 5,800 | 23,785 |
| Lojas Americanas S.A. | 3,400 | 25,218 |
| Marcopolo S.A. | 7,200 | 14,524 |
| Metalurgica Gerdau S.A. | 3,500 | 27,015 |
| Oi S.A. | 37,700 | 52,148 |
| Petróleo Brasileiro S.A. | 4,500 | 31,482 |
| Usiminas Usi Sd Mg (a) | 4,500 | 20,409 |
| Vale S.A., Class A | 2,000 | 25,137 |
| 303,790 | ||
| CHILE—0.2% | ||
| Embotelladora Andina S.A. | 18,327 | 66,081 |
| COLOMBIA—1.0% | ||
| Banco Davivienda S.A. | 6,282 | 81,239 |
| Bancolombia S.A.. | 4,230 | 58,910 |
| Grupo Argos S.A. | 8,530 | 89,183 |
| Grupo Aval Acciones y Valores S.A. | 96,196 | 63,714 |
| Grupo de Inversiones Suramericana S.A. | 2,728 | 50,952 |
| 343,998 | ||
| RUSSIA—0.4% | ||
| AK Transneft OAO | 17 | 36,781 |
| Sberbank | 27,410 | 52,236 |
| Surgutneftegas OAO | 44,000 | 31,526 |
| 120,543 | ||
| SOUTH KOREA—0.3% | ||
| Hyundai Motor Company Ltd. | 252 | 35,985 |
| LG Chem Ltd. | 149 | 20,787 |
| Samsung Electronics Co. Ltd. | 27 | 26,811 |
| 83,583 | ||
| TOTAL PREFERRED STOCK | ||
| (Cost $955,508) | 917,995 | |
| Rights—0.0% | ||
| CHILE—0.0% | ||
| AES Gener S.A. | 4,221 | 322 |
| (Cost $0) | ||
| Exchange Traded Funds—2.4% | ||
| United States—2.4% | ||
| Vanguard FTSE Emerging Markets ETF (b) | 19,694 | 799,183 |
| (Cost $761,192) | ||
| Exchange Traded Notes—5.0% | ||
| United Kingdom—5.0% | ||
| iPath MSCI India Index ETN (a) | 27,900 | 1,691,577 |
| (Cost $1,470,665) |
Short Term Investments—0.2%
| Par Value | Value | |
| State Street Bank & Trust Co., Repurchase Agreement .0%, 04/01/14, (Dated 03/31/14), Collateralized by 75,000 par U.S. Treasury Note-.625% due 11/30/2017, Market Value $73,369, Repurchase Proceeds $67,449 (Cost $67,449) | 67,449 | $67,449 |
TOTAL INVESTMENTS (EXCLUDING INVESTMENTS PURCHASED WITH CASH COLLATERAL FROM SECURITIES LOANED) (Cost $32,658,080) | 33,674,322 | |
| INVESTMENTS PURCHASED WITH CASH COLLATERAL FROM SECURITIES LOANED—3.1% | ||
| Money Market—3.1% | ||
Western Asset Institutional Cash Reserves—Inst. (Cost $1,067,647) | 1,067,647 | 1,067,647 |
TOTAL INVESTMENTS—103% (Cost $33,725,727) | 34,741,969 | |
| OTHER ASSETS & LIABILITIES (NET)—(3.0%) | (1,018,434) | |
| NET ASSETS—100% | $33,723,535 |
| * | Fair valued by Valuation Committee as delegated by Pear Tree Funds Board of Trustees that represent 0.2% of net assets as of March 31, 2014. |
| (a) | Non-income producing security. |
| (b) | All or a portion of this security was out on loan. |
| (c) | ADR—American Depositary Receipts |
| (d) | GDR—Global Depositary Receipts |
| (e) | NVDR—Non-Voting Depository Receipts |
| (f) | At March 31, 2014, the unrealized appreciation of investments based on aggregate cost for federal tax purposes of $33,902,721 was as follows: |
| Aggregate gross unrealized appreciation for all investments in which there is an excess of value over tax cost | $2,199,610 |
| Aggregate gross unrealized depreciation for all investments in which there is an excess of tax cost over value | (1,360,363) |
| Net unrealized appreciation / (depreciation) | $839,247 |
| The percentage of each investment category is calculated as a percentage of net assets. |
SECTOR ALLOCATIONS (as a percentage of Total Net Assets) | |
| Financials | 15.0% |
| Consumer Staples | 12.0% |
| Telecommunication Services | 11.8% |
| Materials | 10.6% |
| Consumer Discretionary | 9.7% |
| Industrials | 9.3% |
| Utilities | 8.7% |
| Energy | 8.2% |
| Health Care | 5.0% |
| Information Technology | 1.9% |
| Exchange Traded Funds | 2.4% |
| Exchange Traded Notes | 5.0% |
| Cash and Other Assets (Net) | 0.4% |
PEAR TREE POLARIS FOREIGN VALUE FUND
SCHEDULE OF INVESTMENTS
March 31, 2014
Common Stock—93.3%
| Shares | Value | |
| AUSTRALIA—2.1% | ||
| BHP Billiton plc (b) | 509,500 | $31,466,720 |
| BELGIUM—2.0% | ||
| Solvay S.A. | 192,547 | 30,226,638 |
| CANADA—2.5% | ||
| Methanex Corporation | 567,507 | 36,308,189 |
| FINLAND—4.8% | ||
| Caverion Corporation (a) | 840,216 | 9,028,681 |
| Kone OYJ, Class B | 606,400 | 25,429,780 |
| Konecranes OYJ | 831,480 | 26,495,139 |
| YIT OYJ | 983,616 | 10,474,754 |
| 71,428,354 | ||
| FRANCE—6.9% | ||
| Christian Dior S.A. | 172,173 | 33,147,870 |
| Imerys S.A. | 325,283 | 28,926,533 |
| Ipsos | 318,980 | 12,941,586 |
| Maurel et Prom | 1,553,506 | 23,905,887 |
| Transgene S.A. (a) | 163,230 | 2,664,754 |
| 101,586,630 | ||
| GERMANY—16.3% | ||
| BASF SE | 281,400 | 31,277,263 |
| Deutsche Telekom AG | 2,278,776 | 36,824,631 |
| Freenet AG | 1,036,539 | 36,249,463 |
| Hannover Rueck SE | 328,500 | 29,384,583 |
| Lanxess AG | 172,776 | 13,031,857 |
| Muenchener Rueckvers AG | 145,730 | 31,841,309 |
| Symrise AG | 603,150 | 30,129,498 |
| Wincor Nixdorf AG | 448,050 | 32,189,894 |
| 240,928,498 | ||
| HONG KONG—1.6% | ||
| Guangdong Investment Limited | 24,309,800 | 23,348,440 |
| INDIA—1.9% | ||
| Infosys Technologies Ltd. (b) | 516,745 | 27,997,244 |
| IRELAND—5.1% | ||
| CRH plc | 1,136,799 | 31,627,605 |
| Greencore Group plc | 9,674,882 | 44,474,317 |
| 76,101,922 | ||
| ISRAEL—2.5% | ||
| Teva Pharmaceuticals SP (b) | 697,619 | 36,862,188 |
| ITALY—4.3% | ||
| GTECH SpA | 958,765 | 29,124,570 |
| Trevi Finanziaria SpA | 3,087,826 | 34,605,820 |
| 63,730,390 | ||
| JAPAN—8.0% | ||
| Asahi Group Holdings Ltd. | 1,105,400 | 31,006,365 |
| KDDI Corporation | 543,200 | 31,517,677 |
| Meiji Holdings Co., Ltd. | 484,000 | 30,592,165 |
| Showa Denko K.K. | 18,250,000 | 25,870,188 |
| 118,986,395 | ||
| NORWAY—3.1% | ||
| DnB Bank ASA | 1,705,492 | 29,635,728 |
| SpareBank 1 SR-Bank ASA | 767,758 | 7,785,487 |
| Yara International ASA | 206,304 | 9,111,978 |
| 46,533,193 | ||
| SOUTH AFRICA—2.3% | ||
| Sasol Ltd. | 604,135 | 33,826,052 |
| SOUTH KOREA—2.2% | ||
| Samsung Electronics Company Ltd. | 25,385 | 32,027,859 |
| SWEDEN—7.3% | ||
| Duni AB | 1,779,500 | 23,357,526 |
| Investor AB, Class B | 904,856 | 32,724,746 |
| Loomis AB, Class B | 825,648 | 21,228,490 |
| Svenska Handelsbanken AB, Class A | 611,500 | 30,670,610 |
| 107,981,372 | ||
| SWITZERLAND—2.2% | ||
| Novartis AG | 374,850 | 31,797,489 |
| THAILAND—2.0% | ||
| Thai Oil PCL | 18,521,200 | 30,259,667 |
| UNITED KINGDOM—16.2% | ||
| Barratt Developments plc | 5,380,148 | 37,003,689 |
| BBA Aviation plc | 3,501,038 | 19,368,681 |
| Bellway plc | 1,165,406 | 32,256,124 |
| Persimmon plc | 1,361,909 | 30,564,690 |
| Rexam plc | 3,684,568 | 29,906,390 |
| Standard Chartered plc | 1,372,947 | 28,694,916 |
| Taylor Wimpey plc | 17,895,270 | 35,148,791 |
| Tullow Oil plc | 2,073,000 | 25,871,282 |
| 238,814,563 | ||
TOTAL COMMON STOCK (Cost $1,033,307,476) | 1,380,211,803 | |
| Short Term Investments—6.7% | ||
| Par Value | Value | |
| Money Market—6.7% | ||
State Street Global Advisors FDS (Cost $99,429,471) | 99,429,471 | 99,429,471 |
TOTAL INVESTMENTS—100.0% (Cost $1,132,736,947) | 1,479,641,274 | |
| OTHER ASSETS & LIABILITIES (NET)—0.0% | (741,611) | |
| NET ASSETS—100% | $1,478,899,663 |
| (a) | Non-income producing security |
| (b) | ADR—American Depository Receipts |
| (c) | At March 31, 2014, the unrealized appreciation of investments based on aggregate cost for federal tax purposes of $1,147,012,556 was as follows: |
| Aggregate gross unrealized appreciation for all investments in which there is an excess of value over tax cost | $354,077,177 |
| Aggregate gross unrealized depreciation for all investments in which there is an excess of tax cost over value | (21,448,459) |
| Net unrealized appreciation/(depreciation) | $ 332,628,718 |
| The percentage of each investment category is calculated as a percentage of net assets. |
SECTOR ALLOCATIONS (as a percentage of Total Net Assets) | |
| Materials | 20.1% |
| Consumer Discretionary | 15.8% |
| Financials | 12.9% |
| Industrials | 9.9% |
| Energy | 7.7% |
| Consumer Staples | 7.2% |
| Telecommunication Services | 7.1% |
| Information Technology | 6.2% |
| Health Care | 4.8% |
| Utilities | 1.6% |
| Cash and Other Assets (Net) | 6.7% |
PEAR TREE POLARIS FOREIGN VALUE SMALL CAP FUND
SCHEDULE OF INVESTMENTS
March 31, 2014
Common Stock—87.4%
| Shares | Value | |
| AUSTRALIA—0.3% | ||
| Austal Limited (a) | 552,530 | $499,606 |
| AUSTRIA—1.4% | ||
| Semperit AG Holding | 47,800 | 2,566,897 |
| BELGIUM—1.7% | ||
| Kinepolis Group | 15,900 | 3,111,333 |
| BRAZIL—2.0% | ||
| Equatorial Energia SA | 420,637 | 3,813,631 |
| CHINA—2.9% | ||
| China Hongxing Sports Limited* (a) | 10,258,400 | 81,523 |
| Shanghai Mechanical & Electrical Industry Co. Ltd., Class B | 1,455,568 | 2,774,312 |
| Xinhua Winshare Publishing and Media Co., Ltd. | 4,474,500 | 2,555,456 |
| 5,411,291 | ||
| FINLAND—1.3% | ||
| PKC Group OYJ | 79,000 | 2,462,921 |
| FRANCE—2.6% | ||
| Bonduelle SCA | 83,700 | 2,476,843 |
| Ipsos SA | 58,800 | 2,385,621 |
| 4,862,464 | ||
| GERMANY—5.4% | ||
| Freenet AG | 127,700 | 4,465,878 |
| QSC AG | 579,039 | 2,887,720 |
| Sixt SE | 67,277 | 2,686,450 |
| 10,040,048 | ||
| HONG KONG—5.4% | ||
| Samson Holding Ltd. | 18,884,800 | 2,507,667 |
| Texwinca Holdings Limited | 2,390,300 | 2,579,278 |
| VST Holdings Ltd. | 9,507,360 | 2,451,377 |
| VTech Holdings Limited | 196,100 | 2,521,800 |
| 10,060,122 | ||
| INDIA—3.3% | ||
| KRBL Ltd. | 1,475,200 | 1,221,460 |
| LIC Housing Finance Ltd. | 435,600 | 1,714,027 |
| NIIT Technologies Ltd. | 99,975 | 677,716 |
| South Indian Bank Ltd. | 4,190,998 | 1,564,892 |
| Usha Martin Group Ltd. | 1,770,198 | 1,037,414 |
| 6,215,509 | ||
| IRELAND—8.8% | ||
| Glanbia plc | 189,900 | 2,914,398 |
| Greencore Group plc | 1,437,044 | 6,605,926 |
| IFG Group plc | 1,062,985 | 2,533,448 |
| UDG Healthcare plc | 720,896 | 4,218,971 |
| 16,272,743 | ||
| ITALY—2.8% | ||
| De’Longhi SpA | 118,910 | 2,678,397 |
| Trevi Finanziaria SpA | 233,100 | 2,612,393 |
| 5,290,790 | ||
| JAPAN—11.3% | ||
| Ain Pharmaciez, Inc. | 55,800 | 2,586,970 |
| BML, Inc. | 105,400 | 3,965,484 |
| Chugoku Marine Paints Ltd. | 537,600 | 3,826,019 |
| Daicel Corporation | 414,700 | 3,406,342 |
| DaiichiKosho Co., Ltd. | 83,600 | 2,536,531 |
| Higashi Nihon House Co., Ltd. | 512,000 | 2,306,597 |
| Unipres Corporation | 129,800 | 2,337,774 |
| 20,965,717 | ||
| NORWAY—5.2% | ||
| ABG Sundal Collier Holding ASA | 2,614,700 | 2,487,780 |
| SpareBank 1 Nord-Norge | 403,996 | 2,333,288 |
| SpareBank 1 SMN | 262,165 | 2,352,168 |
| SpareBank 1 SR-Bank ASA | 243,300 | 2,467,195 |
| 9,640,431 | ||
| PHILIPPINES—1.2% | ||
| Manila Water Company, Inc. | 4,081,170 | 2,175,046 |
| SINGAPORE—3.4% | ||
| BreadTalk Group Ltd. | 2,815,100 | 2,762,863 |
| M1 Ltd. | 1,320,300 | 3,640,832 |
| 6,403,695 | ||
| SOUTH AFRICA—1.1% | ||
| Clicks Group Limited | 343,830 | 2,140,417 |
| SWEDEN—4.4% | ||
| Duni AB | 177,700 | 2,332,471 |
| Loomis AB | 97,800 | 2,514,566 |
| Nolato AB | 129,700 | 3,264,657 |
| 8,111,694 | ||
| SWITZERLAND—1.9% | ||
| Vetropack Holding AG | 1,886 | 3,487,655 |
| TAIWAN—3.0% | ||
| Holtek Semiconductor, Inc. | 1,508,600 | 3,086,307 |
| WT Microelectronics Co., Ltd. | 1,928,900 | 2,473,477 |
| 5,559,784 | ||
| THAILAND—4.3% | ||
| Hana Microelectronics PCL | 2,782,680 | 2,616,268 |
| Ratchaburi Electricity Generating Holding PCL | 1,740,800 | 2,777,016 |
| Thai Union Frozen Products PCL | 1,189,174 | 2,520,213 |
| 7,913,497 | ||
| UNITED KINGDOM—13.7% | ||
| Alternative Networks plc | 488,200 | 4,027,267 |
| BBA Aviation plc | 443,911 | 2,455,835 |
| Character Group plc | 496,900 | 1,512,024 |
| Clarkson plc | 64,500 | 2,632,679 |
| Galliford Try plc | 193,828 | 4,288,588 |
| Halfords Group plc | 320,431 | 2,467,262 |
| Restaurant Group plc (The) | 250,600 | 2,979,185 |
| Vitec Group plc | 221,059 | 2,252,041 |
| Wetherspoon (J.D.) plc | 196,400 | 2,804,760 |
| 25,419,641 | ||
TOTAL COMMON STOCK (Cost $108,263,638) | 162,424,932 | |
| Preferred Stock—1.8% | ||
| GERMANY—1.8% | ||
Drädaegerwerk AG (Cost $2,218,869) | 27,800 | 3,414,708 |
| P-Notes—3.0% | ||
| India—3.0% | ||
| KRBL Limited | 1,679,000 | 1,390,205 |
| LIC Housing Finance | 204,200 | 803,500 |
| NIIT Technologies | 276,900 | 1,877,064 |
| South Indian Bank | 2,535,250 | 946,647 |
| Usha Martin Group | 807,100 | 472,996 |
| (Cost $2,692,091) | 5,490,412 |
Short Term Investments—7.8%
| Par Value | Value | |
| Money Market—7.8% | ||
State Street Global Advisors FDS (Cost $14,514,506) | $14,514,506 | $14,514,506 |
TOTAL INVESTMENTS—100.0% (Cost $127,689,104) | 185,844,558 | |
| OTHER ASSETS & LIABILITIES (NET)—0.0% | (105,619) | |
| NET ASSETS—100% | $185,738,939 |
| * | Fair valued by Valuation Committee as delegated by Pear Tree Funds Board of Trustees that represent 0.04% of net assets as of March 31, 2014. |
| (a) | Non-income producing security |
| (b) | At March 31, 2014, the unrealized appreciation of investments based on aggregate cost for federal tax purposes of $127,814,809 was as follows: |
| Aggregate gross unrealized appreciation for all investments in which there is an excess of value over tax cost | $61,628,784 |
| Aggregate gross unrealized depreciation for all investments in which there is an excess of tax cost over value | (3,599,035) |
| Net unrealized appreciation/(depreciation) | $ 58,029,749 |
| The percentage of each investment category is calculated as a percentage of net assets. |
SECTOR ALLOCATIONS (as a percentage of Total Net Assets) | |
| Consumer Discretionary | 21.3% |
| Industrials | 14.5% |
| Consumer Staples | 12.1% |
| Information Technology | 10.2% |
| Financials | 9.3% |
| Telecommunication Services | 8.1% |
| Health Care | 6.2% |
| Materials | 5.8% |
| Utilities | 4.7% |
| Cash and Other Assets (Net) | 7.8% |
PEAR TREE FUNDS
STATEMENT OF ASSETS AND LIABILITIES
March 31, 2014
| Small Cap | Quality | |
| Assets: | ||
| Investments at Value of Non-affiliated securities (Includes collateral from securities on loan of $6,571,585; $566,740; $7,428,337; $1,067,647; $0: $0, respectively* (Note 2) | $123,960,149 | $124,870,295 |
| Investments at Value of Affiliated Securities | — | — |
| Repurchase Agreements/Commercial Paper | 696,991 | 394,596 |
| Foreign Currency at Value (Cost $168,004 for Emerging Markets,$56,547 for Risk Parity, $851,551 for Foreign Value and $0 for Foreign Value Small Cap) | — | — |
| Cash | — | — |
| Dividends, Interest and Foreign Tax Reclaims Receivable | 50,799 | 246,058 |
| Receivable for Investments Sold | 251,852 | 103,227 |
| Receivable for Shares of Beneficial Interest Sold | 82,373 | — |
| Other Assets | 13,863 | 7,527 |
| Total Assets | $125,056,027 | $125,621,703 |
| Liabilities: | ||
| Payable for Investments Purchased | $1,140,917 | $— |
| Payable for Shares of Beneficial Interest Repurchased | — | 20,000 |
| Payable for Compensation of Manager (Note 3) | 99,896 | 71,867 |
| Payable for Distribution Fees (Note 3) | 22,994 | 24,279 |
| Payable to Custodian | 8,077 | 6,938 |
| Payable to Transfer Agent (Note 3) | 18,339 | 19,120 |
| Payable for Collateral Received for Securities Loaned | 6,571,585 | 566,740 |
| Payable for Foreign Capital Gain Tax | — | — |
| Other Accrued Expenses | 12,140 | 10,606 |
| Total Liabilities | $7,873,948 | $719,550 |
| Net Assets | $117,182,079 | $124,902,153 |
* Includes securities on loan to brokers with market value of , $6,409,708; $554,436; $7,169,759; $1,020,113; $0: $0, respectively.)
Emerging Markets | Risk Parity | Foreign Value | Foreign Value Small Cap |
| $121,017,450 | $34,674,519 | $1,479,641,274 | $185,844,558 |
| 32,910,247 | — | — | — |
| 2,090,917 | 67,449 | — | — |
| 169,778 | 57,332 | 849,403 | — |
| — | — | 96,476 | — |
| 248,942 | 48,338 | 7,398,615 | 531,202 |
| — | — | — | — |
| 61,072 | — | 8,361,519 | 537,711 |
| 178,952 | — | 22,387 | — |
| $156,677,358 | $34,847,638 | $1,496,369,674 | $186,913,471 |
| $1,777,967 | $15,951 | $14,868,730 | $854,469 |
| 18,386 | — | 801,252 | 39,669 |
| 93,980 | 16,181 | 1,228,417 | 142,548 |
| 26,950 | 125 | 188,544 | 27,566 |
| 29,365 | 19,089 | 67,644 | 14,445 |
| 21,372 | 4,904 | 223,736 | 25,700 |
| 7,428,337 | 1,067,647 | — | — |
| — | — | — | 65,070 |
| 3,787 | 206 | 91,688 | 5,065 |
| $9,400,144 | $1,124,103 | $17,470,011 | $1,174,532 |
| $147,277,214 | $33,723,535 | $1,478,899,663 | $185,738,939 |
| Small Cap | Quality | |
| Net Assets Consist Of : | ||
| Shares of Beneficial Interest | $77,376,943 | $99,292,558 |
| Undistributed Net Investment Income | (408,943) | 360,382 |
| Accumulated Net Realized Gain/(Loss) on Investments and Foreign Denominated Assets, Liabilities and Currency | 6,839,264 | 3,539,229 |
| Unrealized Appreciation/(Depreciation) of Investments and Foreign Denominated Assets, Liabilities and Currency | 33,374,815 | 21,709,984 |
| Net Assets | $117,182,079 | $124,902,153 |
| Investments at Cost—Non-affiliated securities | $91,282,325 | $103,554,907 |
| Investments at Cost—Affiliated securities | $— | $— |
| Net assets | ||
| Ordinary Shares | $107,369,837 | $114,856,860 |
| Institutional Shares | $9,812,242 | $10,045,293 |
| Shares of Beneficial Interest Outstanding (Unlimited Number of Shares Authorized) | ||
| Ordinary Shares | 3,887,420 | 6,344,932 |
| Institutional Shares | 312,825 | 530,141 |
| Net Asset Value and Offering Price Per Share | ||
| Ordinary Shares | $27.62 | $18.10 |
| Institutional Shares | $31.37 | $18.95 |
Emerging Markets | Risk Parity | Foreign Value | Foreign Value Small Cap |
| $163,854,783 | $32,949,691 | $1,382,000,982 | $129,445,683 |
| 2,022,217 | (22,379) | 10,971,136 | 1,060,469 |
| (19,796,937) | (220,907) | (261,007,793) | (2,858,099) |
| 1,197,151 | 1,017,130 | 346,935,338 | 58,090,886 |
| $147,277,214 | $33,723,535 | $1,478,899,663 | $185,738,939 |
| $122,718,630 | $33,725,726 | $1,132,736,947 | $127,689,104 |
| $32,104,404 | $— | $— | $— |
| $131,919,684 | $652,358 | $908,107,751 | $138,321,067 |
| $15,357,530 | $33,071,177 | $570,791,912 | $47,417,872 |
| 5,954,674 | 63,309 | 46,863,090 | 10,502,559 |
| 683,694 | 3,195,350 | 29,443,710 | 3,594,841 |
| $22.15 | $10.30 | $19.38 | $13.17 |
| $22.46 | $10.35 | $19.39 | $13.19 |
PEAR TREE FUNDS
STATEMENT OF OPERATIONS
For the Year/Period Ended March 31, 2014
| Small Cap | Quality | |
| Investment Income: | ||
| Dividends* | $1,153,906 | $2,764,914 |
| Dividends from affiliated securities | — | — |
| Interest | 74 | 28 |
| Sec Lending Income | 303,749 | 1,412 |
| Total Investment Income | $1,457,729 | $2,766,354 |
| Expenses: | ||
| Compensation of Manager (Note 3) | 1,188,645 | 1,137,329 |
| Distribution Fees, Ordinary Shares (Note 3) | 274,610 | 265,578 |
| Administrative Fees (Note 3) | 35,183 | 33,321 |
| Custodian and Fund Accounting Fees | 46,253 | 38,399 |
| Regulatory and Compliance (Note 3) | 14,339 | 13,568 |
| Transfer Agent Fees (Note 3): | ||
| Ordinary Shares | 179,671 | 173,983 |
| Institutional Shares | 14,784 | 12,811 |
| Audit and Legal | 2,093 | 19,562 |
| Registration Fees | 22,285 | 26,048 |
| Insurance | — | — |
| Compensation of Trustees (Note 3) | 9,710 | 9,184 |
| Printing | 10,542 | 10,748 |
| Miscellaneous | — | 3,271 |
| Total Expenses Before Waivers/Reimbursements/Reductions | 1,798,115 | 1,743,802 |
| Waivers and/or Reimbursements of Expenses (Note 3) | — | (284,331) |
| Reimbursement of Class specific expenses- Class I | — | (1,834) |
| Expenses, Net | $1,798,115 | $1,457,637 |
| Net Investment Income/(Loss) | $(340,386) | $1,308,717 |
| Realized and Unrealized Gain/(Loss) on Investments, | ||
| Foreign Currency, and Foreign Translation: | ||
| Net Realized Gain/(Loss) (Note 2) on: | ||
| Investments | $18,094,547 | $8,532,860 |
| Foreign Denominated Assets, Liabilities, and Currency | — | (331) |
| Change in Unrealized Appreciation/(Depreciation) of: | ||
| Investments | 7,230,917 | 6,564,610 |
| Foreign Denominated Assets, Liabilities, and Currency | — | — |
| Net Realized and Unrealized Gain/(Loss) | 25,325,464 | 15,097,139 |
| Net Increase/(Decrease) in Net Assets From Operations | $24,985,078 | $16,405,856 |
* Dividends are net of foreign withholding taxes of $7,896: $48,442: $543,900: $46,595: $3,233,793, and $263,903 respectively.
Emerging Markets | Risk Parity | Foreign Value | Foreign Value Small Cap |
| $4,280,733 | $350,616 | $29,953,114 | $3,615,588 |
| 177,366 | — | — | — |
| 16 | 7 | 19,089 | 487 |
| 35,092 | 3,119 | — | — |
| $4,493,207 | $353,742 | $29,972,203 | $3,616,075 |
| 1,256,893 | 118,092 | 11,310,328 | 1,286,369 |
| 326,671 | 700 | 2,090,838 | 254,544 |
| 43,366 | 5,432 | 323,092 | 36,941 |
| 214,000 | 105,000 | 428,000 | 85,700 |
| 17,908 | 1,910 | 130,034 | 15,032 |
| 213,038 | 657 | 1,368,792 | 166,436 |
| 23,414 | 31,472 | 479,195 | 44,013 |
| 84,311 | 56,559 | 164,326 | 18,973 |
| 31,994 | 11,866 | 71,789 | 31,806 |
| — | 599 | 15,637 | 3,307 |
| 12,146 | 1,274 | 87,817 | 10,169 |
| 51,119 | 846 | 72,203 | 7,604 |
| 11,632 | 2,980 | 89,327 | 10,201 |
| 2,286,492 | 337,387 | 16,631,378 | 1,971,095 |
| — | — | — | — |
| — | — | — | — |
| $2,286,492 | $337,387 | $16,631,378 | $1,971,095 |
| $2,206,715 | $16,355 | $13,340,825 | $1,644,980 |
| $11,078,333 | $(50,135) | $(17,723,267) | $(1,599,655) |
| (131,690) | (26,708) | (269,671) | (45,735) |
| (20,590,812) | 1,016,242 | 243,232,921 | 32,502,095 |
| 9,641 | 888 | 97,226 | (63,291) |
| (9,634,528) | 940,287 | 225,337,209 | 30,793,414 |
| $(7,427,813) | $956,642 | $238,678,034 | $32,438,394 |
PEAR TREE FUNDS
STATEMENT OF CHANGES IN NET ASSETS
| Small Cap | ||
Year Ended March 31, 2014 | Year Ended March 31, 2013 | |
| Increase (Decrease) in Net Assets: | ||
| Operations: | ||
| Net investment income/(loss) | $(340,386) | $(141,047) |
| Net realized gain/(loss) on investments Foreign denominated assets, liabilities, and currency | 18,094,547 | 10,316,847 |
| Unrealized appreciation/(depreciation) of investments, foreign denominated assets, liabilities, and currency | 7,230,917 | 180,132 |
| Net increase/(decrease) from operations | $24,985,078 | $10,355,932 |
| Distributions to shareholders from: | ||
| Net investment income | ||
| Ordinary shares | $— | $— |
| Institutional shares | — | — |
| Net realized gains | ||
| Ordinary shares | — | — |
| Institutional shares | — | — |
| Total distributions | $— | $— |
| Fund share transactions (Note 8) | (17,078,515) | (3,191,522) |
| Contributions to capital from investment manager/brokers | — | — |
| Increase/(decrease) in net assets | $7,906,563 | $7,164,410 |
| Net assets beginning of period | 109,275,516 | 102,111,106 |
| Net assets end of period* | $117,182,079 | $109,275,516 |
| * Includes undistributed net investment income/(loss) of: | $(408,943) | $(333,012) |
PEAR TREE FUNDS
STATEMENT OF CHANGES IN NET ASSETS (continued)
| Quality | ||
Year Ended March 31, 2014 | Year Ended March 31, 2013 | |
| Increase (Decrease) in Net Assets: | ||
| Operations: | ||
| Net investment income/(loss) | $1,308,717 | $1,066,015 |
| Net realized gain/(loss) on investments | 8,532,529 | 4,533,151 |
| Foreign denominated assets, liabilities, and currency | ||
| Unrealized appreciation/(depreciation) of investments, foreign denominated assets, liabilities, and currency | 6,564,610 | 4,956,354 |
| Net increase/(decrease) from operations | $16,405,856 | $10,555,520 |
| Distributions to shareholders from: | ||
| Net investment income | ||
| Ordinary shares | $(1,155,444) | $(1,005,173) |
| Institutional shares | (114,089) | (35,923) |
| Net realized gains | ||
| Ordinary shares | — | — |
| Institutional shares | — | — |
| Total distributions | $(1,269,533) | $(1,041,096) |
| Fund share transactions (Note 8) | 8,156,939 | (3,020,891) |
| Contributions to capital from investment manager/brokers | — | — |
| Increase/(decrease) in net assets | $23,293,262 | $6,493,533 |
| Net assets beginning of period | 101,608,891 | 95,115,358 |
| Net assets end of period* | $124,902,153 | $101,608,891 |
| * Includes undistributed net investment income/(loss) of: | $360,382 | $321,529 |
PEAR TREE FUNDS
STATEMENT OF CHANGES IN NET ASSETS (continued)
| Emerging Markets | ||
Year Ended March 31, 2014 | Year Ended March 31, 2013 | |
| Increase (Decrease) in Net Assets: | ||
| Operations: | ||
| Net investment income/(loss) | $2,206,715 | $2,580,085 |
| Net realized gain/(loss) on investments | 10,946,643 | (4,307,016) |
| Foreign denominated assets, liabilities, and currency | ||
| Unrealized appreciation/(depreciation) of investments, foreign denominated assets, liabilities, and currency | (20,581,171) | 9,498,471 |
| Net increase/(decrease) from operations | $(7,427,813) | $7,771,540 |
| Distributions to shareholders from: | ||
| Net investment income | ||
| Ordinary shares | $(1,723,075) | $(1,974,284) |
| Institutional shares | (218,189) | (244,086) |
| Net realized gains | ||
| Ordinary shares | — | — |
| Institutional shares | — | — |
| Total distributions | $(1,941,264) | $(2,218,370) |
| Fund share transactions (Note 8) | 1,214,076 | (10,891,444) |
| Contributions to capital from investment manager/brokers | 140 | 272 |
| Increase/(decrease) in net assets | $(8,154,861) | $(5,338,002) |
| Net assets beginning of period | 155,432,075 | 160,770,077 |
| Net assets end of period* | $147,277,214 | $155,432,075 |
| * Includes undistributed net investment income/(loss) of: | $2,022,217 | $1,821,344 |
PEAR TREE FUNDS
STATEMENT OF CHANGES IN NET ASSETS (continued)
| Risk Party | ||
Year Ended March 31, 2014 | Year Ended March 31, 2013 | |
| Increase (Decrease) in Net Assets: | ||
| Operations: | ||
| Net investment income/(loss) | $16,355 | $— |
| Net realized gain/(loss) on investments | (76,843) | — |
| Foreign denominated assets, liabilities, and currency | ||
| Unrealized appreciation/(depreciation) of investments, foreign denominated assets, liabilities, and currency | 1,017,130 | — |
| Net increase/(decrease) from operations | $956,642 | $— |
| Distributions to shareholders from: | ||
| Net investment income | ||
| Ordinary shares | $(244) | $— |
| Institutional shares | (11,782) | — |
| Net realized gains | ||
| Ordinary shares | (4,284) | — |
| Institutional shares | (166,488) | — |
| Total distributions | $(182,798) | $— |
| Fund share transactions (Note 8) | 32,948,441 | — |
| Contributions to capital from investment manager/brokers | 1,250 | — |
| Increase/(decrease) in net assets | $33,723,535 | $— |
| Net assets beginning of period | — | — |
| Net assets end of period* | $33,723,535 | $— |
| * Includes undistributed net investment income/(loss) of: | $(22,379) | $— |
PEAR TREE FUNDS
STATEMENT OF CHANGES IN NET ASSETS (continued)
| Foreign Value | ||
Year Ended March 31, 2014 | Year Ended March 31, 2013 | |
| Increase (Decrease) in Net Assets: | ||
| Operations: | ||
| Net investment income/(loss) | $13,340,825 | $6,538,258 |
| Net realized gain/(loss) on investments | (17,992,938) | 19,539,318 |
| Foreign denominated assets, liabilities, and currency | ||
| Unrealized appreciation/(depreciation) of investments, foreign denominated assets, liabilities, and currency | 243,330,147 | 83,694,217 |
| Net increase/(decrease) from operations | $238,678,034 | $109,771,793 |
| Distributions to shareholders from: | ||
| Net investment income | ||
| Ordinary shares | $(6,913,696) | $(2,944,067) |
| Institutional shares | (1,994,868) | (1,288,826) |
| Net realized gains | ||
| Ordinary shares | — | — |
| Institutional shares | — | — |
| Total distributions | $(8,908,564) | $(4,232,893) |
| Fund share transactions (Note 8) | 363,655,310 | 295,815,079 |
| Contributions to capital from investment manager/brokers | 283 | 1,021 |
| Increase/(decrease) in net assets | $593,425,063 | $401,355,000 |
| Net assets beginning of period | 885,474,600 | 484,119,600 |
| Net assets end of period* | $1,478,899,663 | $885,474,600 |
| * Includes undistributed net investment income/(loss) of: | $10,971,136 | $6,113,730 |
PEAR TREE FUNDS
STATEMENT OF CHANGES IN NET ASSETS (continued)
Foreign Value Small Cap | ||
Year Ended March 31, 2014 | Year Ended March 31, 2013 | |
| Increase (Decrease) in Net Assets: | ||
| Operations: | ||
| Net investment income/(loss) | $1,644,980 | $1,557,296 |
| Net realized gain/(loss) on investments | (1,645,390) | 1,232,152 |
| Foreign denominated assets, liabilities, and currency | ||
| Unrealized appreciation/(depreciation) of investments, foreign denominated assets, liabilities, and currency | 32,438,804 | 14,366,873 |
| Net increase/(decrease) from operations | $32,438,394 | $17,156,321 |
| Distributions to shareholders from: | ||
| Net investment income | ||
| Ordinary shares | $(1,131,114) | $(1,309,405) |
| Institutional shares | (360,329) | (367,559) |
| Net realized gains | ||
| Ordinary shares | — | — |
| Institutional shares | — | — |
| Total distributions | $(1,491,443) | $(1,676,964) |
| Fund share transactions (Note 8) | 39,526,627 | 6,481,643 |
| Contributions to capital from investment manager/brokers | — | — |
| Increase/(decrease) in net assets | $70,473,578 | $21,961,000 |
| Net assets beginning of period | 115,265,361 | 93,304,361 |
| Net assets end of period* | $185,738,939 | $115,265,361 |
| * Includes undistributed net investment income/(loss) of: | $1,060,469 | $1,194,780 |
PEAR TREE COLUMBIA SMALL CAP FUND
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout each period)
| Ordinary Shares | |||||
| Years Ended March 31, | |||||
| 2014 | 2013 | 2012 | 2011 | 2010 | |
| Net Asset Value, Beginning of Period | $22.50 | $20.36 | $19.92 | $16.45 | $10.22 |
| Income from Investment Operations: | |||||
| Net investment income (loss) (a)(b) | (0.08) | (0.03) | (0.08) | 0.04 | 0.11 |
| Net realized and unrealized gain/(loss) on securities | 5.20 | 2.17 | 0.57 | 3.52 | 6.15 |
| Total from Investment Operations | 5.12 | 2.14 | 0.49 | 3.56 | 6.26 |
| Less Distributions: | |||||
| Dividends from net investment income | — | — | (0.05) | (0.09) | (0.03) |
| Distributions from realized capital gains | — | — | — | — | — |
| Total Distributions | — | — | (0.05) | (0.09) | (0.03) |
| Net Asset Value, End of Period | $27.62 | $22.50 | $20.36 | $19.92 | $16.45 |
| Total Return | 22.76% | 10.51% | 2.48% | 21.69% | 61.27% |
| Net Assets, End of Period (000’s) | $107,370 | $101,275 | $95,870 | $113,675 | $99,444 |
| Ratios and Supplemental Data: | |||||
| Ratios of expenses to average net assets: (c) | |||||
| Gross | 1.53% | 1.63% | 1.67% | 1.64% | 1.65% |
| Net | 1.53% | 1.63% | 1.67% | 1.64% | 1.65% |
| Ratio of net investment income (loss) to average net assets (b) | (0.30)% | (0.16)% | (0.44)% | 0.23% | 0.81% |
| Portfolio Turnover | 67% | 54% | 53% | 71% | 50% |
| Institutional Shares | |||||
| Years Ended March 31, | |||||
| 2014 | 2013 | 2012 | 2011 | 2010 | |
| Net Asset Value, Beginning of Period | $25.48 | $23.00 | $22.50 | $18.56 | $11.51 |
| Income from Investment Operations: | |||||
| Net investment income (loss) (a)(b) | (0.02) | 0.02 | (0.04) | 0.09 | 0.20 |
| Net realized and unrealized gain/(loss) on securities | 5.91 | 2.46 | 0.63 | 3.98 | 6.91 |
| Total from Investment Operations | 5.89 | 2.48 | 0.59 | 4.07 | 7.11 |
| Less Distributions: | |||||
| Dividends from net investment income | — | — | (0.09) | (0.13) | (0.06) |
| Distributions from realized capital gains | — | — | — | — | — |
| Total Distributions | — | — | (0.09) | (0.13) | (0.06) |
| Net Asset Value, End of Period | $31.37 | $25.48 | $23.00 | $22.50 | $18.56 |
| Total Return | 23.12% | 10.78% | 2.69% | 21.98% | 61.83% |
| Net Assets, End of Period (000’s) | $9,812 | $8,000 | $6,242 | $7,806 | $7,146 |
| Ratios and Supplemental Data: | |||||
| Ratios of expenses to average net assets: (c) | |||||
| Gross | 1.28% | 1.38% | 1.42% | 1.39% | 1.41% |
| Net | 1.28% | 1.38% | 1.42% | 1.39% | 1.41% |
| Ratio of net investment income (loss) to average net assets (b) | (0.08)% | 0.07% | (0.19)% | 0.48% | 1.35% |
| Portfolio Turnover | 67% | 54% | 53% | 71% | 50% |
(a) Per share numbers have been calculated using the average shares method.
(b) Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets reflect net investment income prior to certain reclassifications for federal income or excise tax purposes.
(c) Ratios of expenses to average net assets:
— Gross (total expenses before fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
— Net (total expenses net of fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
PEAR TREE QUALITY FUND
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout each period)
| Ordinary Shares | |||||
| Years Ended March 31, | |||||
| 2014 | 2013 | 2012 | 2011 | 2010 | |
| Net Asset Value, Beginning of Period | $15.85 | $14.33 | $12.36 | $11.37 | $8.24 |
| Income from Investment Operations: | |||||
| Net investment income (loss) (a)(c) | 0.19(b) | 0.16(b) | 0.17(b) | 0.09(b) | 0.05 |
| Net realized and unrealized gain/(loss) on securities | 2.24 | 1.52 | 1.92 | 1.01 | 3.10 |
| Total from Investment Operations | 2.43 | 1.68 | 2.09 | 1.10 | 3.15 |
| Less Distributions: | |||||
| Dividends from net investment income | (0.18) | (0.16) | (0.12) | (0.11) | (0.02) |
| Distributions from realized capital gains | — | — | — | — | — |
| Total Distributions | (0.18) | (0.16) | (0.12) | (0.11) | (0.02) |
| Net Asset Value, End of Period | $18.10 | $15.85 | $14.33 | $12.36 | $11.37 |
| Total Return | 15.40% | 11.85% | 16.99% | 9.78%(d) | 38.30%(d) |
| Net Assets, End of Period (000’s) | $114,857 | $98,033 | $92,557 | $62,920 | $54,213 |
| Ratios and Supplemental Data: | |||||
| Ratios of expenses to average net assets: (e) | |||||
| Gross | 1.55% | 1.62% | 1.66% | 1.93% | 2.10% |
| Net including dividend and interest expense for securities sold short | N/A | N/A | N/A | 1.89% | 2.10% |
| Net excluding dividend and interest expense for securities sold short | 1.30% | 1.46% | 1.51% | 1.85% | 1.92% |
| Ratio of net investment income (loss) to average net assets (c) | 1.13% | 1.11% | 1.28% | 0.84% | 0.50% |
| Portfolio Turnover Excluding Short Positions | 35% | 40% | 68% | 283%(f) | 191%(f) |
| Institutional Shares | |||||
| Years Ended March 31, | |||||
| 2014 | 2013 | 2012 | 2011 | 2010 | |
| Net Asset Value, Beginning of Period | $16.58 | $14.95 | $12.85 | $11.80 | $8.54 |
| Income from Investment Operations: | |||||
| Net investment income (loss) (a)(c) | 0.25(b) | 0.24(b) | 0.25(b) | 0.12(b) | 0.08 |
| Net realized and unrealized gain/(loss) on securities | 2.35 | 1.59 | 1.99 | 1.06 | 3.22 |
| Total from Investment Operations | 2.60 | 1.83 | 2.24 | 1.18 | 3.30 |
| Less Distributions: | |||||
| Dividends from net investment income | (0.23) | (0.20) | (0.14) | (0.13) | (0.04) |
| Distributions from realized capital gains | — | — | — | — | — |
| Total Distributions | (0.23) | (0.20) | (0.14) | (0.13) | (0.04) |
| Net Asset Value, End of Period | $18.95 | $16.58 | $14.95 | $12.85 | $11.80 |
| Total Return | 15.74% | 12.37% | 17.57% | 10.07%(d) | 38.71%(d) |
| Net Assets, End of Period (000’s) | $10,045 | $3,576 | $2,558 | $809 | $591 |
| Ratios and Supplemental Data: | |||||
| Ratios of expenses to average net assets: (e) | |||||
| Gross | 1.31% | 1.35% | 1.41% | 1.71% | 1.81% |
| Net including dividend and interest expense for securities sold short | N/A | N/A | N/A | 1.67% | 1.81% |
| Net excluding dividend and interest expense for securities sold short | 1.03% | 1.01% | 1.00% | 1.63% | 1.63% |
| Ratio of net investment income (loss) to average net assets (c) | 1.38% | 1.58% | 1.85% | 1.08% | 0.75% |
| Portfolio Turnover Excluding Short Positions | 35% | 40% | 68% | 283%(f) | 191%(f) |
Note: This Fund changed its investment strategy on January 27, 2011.
(a) Per share numbers have been calculated using the average shares method.
(b) Reflects expense waivers/reimbursements and reductions in effect during the period. See Note 3 to the Financial Statements.
(c) Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets reflect net investment income prior to certain reclassifications for federal income or excise tax purposes.
(d) The total return would have been lower if certain fees had not been waived or if custodial fees had not been reduced by credits allowed by the custodian. See Note 3 to the financial statements.
(e) Ratios of expenses to average net assets:
— Gross (total expenses before fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
— Net (total expenses net fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
(f) Portfolio turnover is calculated on long security positions only. Short positions are generally held for less than one year.
PEAR TREE PANAGORA DYNAMIC EMERGING MARKETS FUND
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout each period)
| Ordinary Shares | |||||
| Years Ended March 31, | |||||
| 2014 | 2013 | 2012 | 2011 | 2010 | |
| Net Asset Value, Beginning of Period | $23.56 | $22.67 | $25.18 | $21.23 | $12.06 |
| Income from Investment Operations: | |||||
| Net investment income (loss) (a)(b) | 0.33 | 0.37 | 0.41 | 0.24 | 0.18 |
| Net realized and unrealized gain/(loss) on securities | (1.45) | 0.85 | (2.44) | 3.96 | 9.05 |
| Total from Investment Operations | (1.12) | 1.22 | (2.03) | 4.20 | 9.23 |
| Less Distributions: | |||||
| Dividends from net investment income | (0.29) | (0.33) | (0.48) | (0.25) | (0.06) |
| Distributions from realized capital gains | — | — | — | — | — |
| Total Distributions | (0.29) | (0.33) | (0.48) | (0.25) | (0.06) |
| Net Asset Value, End of Period | $22.15 | $23.56 | $22.67 | $25.18 | $21.23 |
| Total Return | (4.77)% | 5.41% | (7.80)% | 19.86% | 76.56% |
| Net Assets, End of Period (000’s) | $131,920 | $140,267 | $145,201 | $176,386 | $205,727 |
| Ratios and Supplemental Data: | |||||
| Ratios of expenses to average net assets: (c) | |||||
| Gross | 1.60% | 1.76% | 1.76% | 1.77% | 1.74% |
| Net | 1.60% | 1.76% | 1.76% | 1.77% | 1.74% |
| Ratio of net investment income (loss) to average net assets (b) | 1.50% | 1.66% | 1.80% | 1.05% | 0.99% |
| Portfolio Turnover | 61% | 25% | 56% | 68% | 120% |
| Institutional Shares | |||||
| Years Ended March 31, | |||||
| 2014 | 2013 | 2012 | 2011 | 2010 | |
| Net Asset Value, Beginning of Period | $23.88 | $22.97 | $25.53 | $21.48 | $12.19 |
| Income from Investment Operations: | |||||
| Net investment income (loss) (a)(b) | 0.39 | 0.43 | 0.41 | 0.42 | 0.27 |
| Net realized and unrealized gain/(loss) on securities | (1.46) | 0.87 | (2.42) | 3.89 | 9.11 |
| Total from Investment Operations | (1.07) | 1.30 | (2.01) | 4.31 | 9.38 |
| Less Distributions: | |||||
| Dividends from net investment income | (0.35) | (0.39) | (0.55) | (0.26) | (0.09) |
| Distributions from realized capital gains | — | — | — | — | — |
| Total Distributions | (0.35) | (0.39) | (0.55) | (0.26) | (0.09) |
| Net Asset Value, End of Period | $22.46 | $23.88 | $22.97 | $25.53 | $21.48 |
| Total Return | (4.52)% | 5.69% | (7.56)% | 20.14% | 77.02% |
| Net Assets, End of Period (000’s) | $15,358 | $15,165 | $15,569 | $11,267 | $26,247 |
| Ratios and Supplemental Data: | |||||
| Ratios of expenses to average net assets: (c) | |||||
| Gross | 1.35% | 1.49% | 1.52% | 1.51% | 1.50% |
| Net | 1.35% | 1.49% | 1.52% | 1.51% | 1.50% |
| Ratio of net investment income (loss) to average net assets (b) | 1.74% | 1.92% | 1.81% | 1.94% | 1.48% |
| Portfolio Turnover | 61% | 25% | 56% | 68% | 120% |
(a) Per share numbers have been calculated using the average shares method.
(b) Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets reflect net investment income prior to certain reclassifications for federal income or excise tax purposes.
(c) Ratios of expenses to average net assets:
— Gross (total expenses before fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
— Net (total expenses net of fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
PEAR TREE PANAGORA RISK PARITY EMERGING MARKETS FUND
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout each period)
| Ordinary Shares | |
June 27, 2013* through March 31, 2014 | |
| Net Asset Value, Beginning of Period | $10.00 |
| Income from Investment Operations: | |
| Net investment income (loss) (a)(b) | (0.03) |
| Net realized and unrealized gain/(loss) on securities | 0.40 |
| Total from Investment Operations | 0.37 |
| Less Distributions: | |
| Dividends from net investment income | — |
| Distributions from realized capital gains | (0.07) |
| Total Distributions | (0.07) |
| Net Asset Value, End of Period | $10.30 |
| Total Return | 3.68%*** |
| Net Assets, End of Period (000’s) | $652 |
| Ratios and Supplemental Data: | |
| Ratios of expenses to average net assets: (c) | |
| Gross | 2.10%** |
| Net | 2.10%** |
| Ratio of net investment income (loss) to average net assets (b) | (0.43)%** |
| Portfolio Turnover | 42%*** |
| Institutional Shares | |
June 27, 2013* through March 31, 2014 | |
| Net Asset Value, Beginning of Period | $10.00 |
| Income from Investment Operations: | |
| Net investment income (loss) (a)(b) | 0.01 |
| Net realized and unrealized gain/(loss) on securities | 0.41 |
| Total from Investment Operations | 0.42 |
| Less Distributions: | |
| Dividends from net investment income | — |
| Distributions from realized capital gains | (0.07) |
| Total Distributions | (0.07) |
| Net Asset Value, End of Period | $10.35 |
| Total Return | 4.19%*** |
| Net Assets, End of Period (000’s) | $33,071 |
| Ratios and Supplemental Data: | |
| Ratios of expenses to average net assets: (c) | |
| Gross | 1.69%** |
| Net | 1.69%** |
| Ratio of net investment income (loss) to average net assets (b) | 0.09%** |
| Portfolio Turnover | 42%*** |
* Fund commenced operations June 27, 2013.
** Annualized.
*** Not Annualized.
(a) Per share numbers have been calculated using the average shares method.
(b) Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets reflect net investment income prior to certain reclassifications for federal income or excise tax purposes.
(c) Ratios of expenses to average net assets:
— Gross (total expenses before fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
— Net (total expenses net of fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
PEAR TREE POLARIS FOREIGN VALUE FUND
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout each period)
| Ordinary Shares | |||||
| Years Ended March 31, | |||||
| 2014 | 2013 | 2012 | 2011 | 2010 | |
| Net Asset Value, Beginning of Period | $15.83 | $13.64 | $14.68 | $12.45 | $6.97 |
| Income from Investment Operations: | |||||
| Net investment income (loss) (a)(b) | 0.19 | 0.15 | 0.12 | 0.07 | 0.13 |
| Net realized and unrealized gain/(loss) on securities | 3.49 | 2.12 | (1.09) | 2.31 | 5.71 |
| Total from Investment Operations | 3.68 | 2.27 | (0.97) | 2.38 | 5.84 |
| Less Distributions: | |||||
| Dividends from net investment income | (0.13) | (0.08) | (0.07) | (0.15) | (0.36) |
| Distributions from realized capital gains | — | — | — | — | — |
| Total Distributions | (0.13) | (0.08) | (0.07) | (0.15) | (0.36) |
| Net Asset Value, End of Period | $19.38 | $15.83 | $13.64 | $14.68 | $12.45 |
| Total Return | 23.28% | 16.73% | (6.55)% | 19.17%(c) | 84.05%(c) |
| Net Assets, End of Period (000’s) | $908,108 | $705,210 | $386,011 | $369,550 | $369,626 |
| Ratios and Supplemental Data: | |||||
| Ratios of expenses to average net assets: (d) | |||||
| Gross | 1.54% | 1.59% | 1.64% | 1.62% | 1.62% |
| Net | 1.54% | 1.59% | 1.64% | 1.62% | 1.62% |
| Ratio of net investment income (loss) to average net assets (b) | 1.11% | 1.04% | 0.93% | 0.56% | 1.17% |
| Portfolio Turnover | 3% | 10% | 18% | 9% | 24% |
| Institutional Shares | |||||
| Years Ended March 31, | |||||
| 2014 | 2013 | 2012 | 2011 | 2010 | |
| Net Asset Value, Beginning of Period | $15.83 | $13.63 | $14.68 | $12.45 | $6.98 |
| Income from Investment Operations: | |||||
| Net investment income (loss) (a)(b) | 0.24 | 0.17 | 0.14 | 0.10 | 0.14 |
| Net realized and unrealized gain/(loss) on securities | 3.48 | 2.15 | (1.09) | 2.31 | 5.71 |
| Total from Investment Operations | 3.72 | 2.32 | (0.95) | 2.41 | 5.85 |
| Less Distributions: | |||||
| Dividends from net investment income | (0.16) | (0.12) | (0.10) | (0.18) | (0.38) |
| Distributions from realized capital gains | — | — | — | — | — |
| Total Distributions | (0.16) | (0.12) | (0.10) | (0.18) | (0.38) |
| Net Asset Value, End of Period | $19.39 | $15.83 | $13.63 | $14.68 | $12.45 |
| Total Return | 23.58% | 17.07% | (6.34)% | 19.48%(c) | 84.12%(c) |
| Net Assets, End of Period (000’s) | $570,792 | $180,265 | $98,109 | $78,790 | $68,067 |
| Ratios and Supplemental Data: | |||||
| Ratios of expenses to average net assets: (d) | |||||
| Gross | 1.28% | 1.33% | 1.39% | 1.37% | 1.37% |
| Net | 1.28% | 1.33% | 1.39% | 1.37% | 1.37% |
| Ratio of net investment income (loss) to average net assets (b) | 1.37% | 1.22% | 1.07% | 0.79% | 1.29% |
| Portfolio Turnover | 3% | 10% | 18% | 9% | 24% |
(a) Per share numbers have been calculated using the average shares method.
(b) Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets reflect net investment income prior to certain reclassifications for federal income or excise tax purposes.
(c) The total return would have been lower if certain fees had not been waived or if custodial fees had not been reduced by credits allowed by the custodian. See Note 3 to the financial statements.
(d) Ratios of expenses to average net assets:
— Gross (total expenses before fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
— Net (total expenses net of fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
PEAR TREE POLARIS FOREIGN VALUE SMALL CAP FUND
FINANCIAL HIGHLIGHTS
(For a share outstanding throughout each period)
| Ordinary Shares | |||||
| Period Ended March 31, | |||||
| 2014 | 2013 | 2012 | 2011 | 2010 | |
| Net Asset Value, Beginning of Period | $10.50 | $9.02 | $11.19 | $10.28 | $4.82 |
| Income from Investment Operations: | |||||
| Net investment income (loss) (a)(b) | 0.14 | 0.14 | 0.21 | 0.09 | 0.07 |
| Net realized and unrealized gain/(loss) on securities | 2.66 | 1.50 | (1.29) | 1.25 | 5.42 |
| Total from Investment Operations | 2.80 | 1.64 | (1.08) | 1.34 | 5.49 |
| Less Distributions: | |||||
| Dividends from net investment income | (0.13) | (0.16) | (0.10) | (0.08) | (0.03) |
| Distributions from realized capital gains | — | — | (0.99) | (0.35) | — |
| Total Distributions | (0.13) | (0.16) | (1.09) | (0.43) | (0.03) |
| Net Asset Value, End of Period | $13.17 | $10.50 | $9.02 | $11.19 | $10.28 |
| Total Return | 26.80% | 18.34% | (8.20)% | 13.12%(c) | 114.00%(c) |
| Net Assets, End of Period (000’s) | $138,321 | $92,806 | $72,737 | $78,307 | $124,971 |
| Ratios and Supplemental Data: | |||||
| Ratios of expenses to average net assets: (d) | |||||
| Gross | 1.58% | 1.66% | 1.70% | 1.69% | 1.64% |
| Net | 1.58% | 1.66% | 1.70% | 1.69% | 1.64% |
| Ratio of net investment income (loss) to average net assets (b) | 1.23% | 1.55% | 2.14% | 0.82% | 0.82% |
| Portfolio Turnover | 4% | 9% | 22% | 54% | 14% |
| Institutional Shares | |||||
| Years Ended March 31, | |||||
| 2014 | 2013 | 2012 | 2011 | 2010 | |
| Net Asset Value, Beginning of Period | $10.51 | $9.03 | $11.21 | $10.30 | $4.82 |
| Income from Investment Operations: | |||||
| Net investment income (loss) (a)(b) | 0.16 | 0.17 | 0.24 | 0.09 | 0.11 |
| Net realized and unrealized gain/(loss) on securities | 2.67 | 1.49 | (1.30) | 1.28 | 5.41 |
| Total from Investment Operations | 2.83 | 1.66 | (1.06) | 1.37 | 5.52 |
| Less Distributions: | |||||
| Dividends from net investment income | (0.15) | (0.18) | (0.13) | (0.11) | (0.04) |
| Distributions from realized capital gains | — | — | (0.99) | (0.35) | — |
| Total Distributions | (0.15) | (0.18) | (1.12) | (0.46) | (0.04) |
| Net Asset Value, End of Period | $13.19 | $10.51 | $9.03 | $11.21 | $10.30 |
| Total Return | 27.16% | 18.59% | (7.99)% | 13.40%(c) | 114.55%(c) |
| Net Assets, End of Period (000’s) | $47,418 | $22,459 | $20,567 | $23,973 | $8,103 |
| Ratios and Supplemental Data: | |||||
| Ratios of expenses to average net assets: (d) | |||||
| Gross | 1.33% | 1.41% | 1.43% | 1.44% | 1.43% |
| Net | 1.33% | 1.41% | 1.43% | 1.44% | 1.43% |
| Ratio of net investment income (loss) to average net assets (b) | 1.47% | 1.88% | 2.45% | 0.92% | 1.27% |
| Portfolio Turnover | 4% | 9% | 22% | 54% | 14% |
(a) Per share numbers have been calculated using the average shares method.
(b) Net investment income (loss) per share and the ratio of net investment income (loss) to average net assets reflect net investment income prior to certain reclassifications for federal income or excise tax purposes.
(c) The total return would have been lower if certain fees had not been waived or if custodial fees had not been reduced by credits allowed by the custodian. See Note 3 to the financial statements.
(d) Ratios of expenses to average net assets:
— Gross (total expenses before fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
— Net (total expenses net of fee waivers, reimbursements by the investment advisor, and custody earnings credits, if any).
PEAR TREE FUNDS
NOTES TO FINANCIAL STATEMENTS
1. Organization of the Trust
Pear Tree Funds, (the “Trust”) is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust currently has six series (each a “Fund” and collectively the “Funds”) each with a distinct investment objective.
Pear Tree Columbia Small Cap Fund (“Small Cap”) seeks maximum long-term capital appreciation.
Pear Tree Quality Fund (“Quality”) seeks long-term growth of capital.
Pear Tree Polaris Foreign Value Fund (“Foreign Value”) seeks long-term capital growth and income.
Pear Tree Polaris Foreign Value Small Cap Fund (“Foreign Value Small Cap”) seeks long-term capital growth and income.
Pear Tree PanAgora Dynamic Emerging Markets Fund (“Emerging Markets”) seeks long-term growth of capital.
Pear Tree PanAgora Risk Parity Emerging Markets Fund (“Risk Parity”) seeks long-term growth of capital.
Each of the Funds is a “non-diversified company,” within the meaning of the 1940 Act, other than Emerging Markets.
Each Fund offers two classes of shares, designated as Ordinary Shares and Institutional Shares. The classes differ principally in their respective expense structure and minimum investment requirements. Each class of shares represents an interest in the same portfolio of investments of the respective Fund and has equal rights to voting (except as noted in the following sentence), redemptions, dividends and liquidation. Ordinary Shares bear distribution (Rule 12b-1) fees and have exclusive voting rights with respect to the distribution plan that has been adopted by Ordinary Share shareholders. There is no distribution plan for Institutional Shares.
At times, a Fund’s investments may represent industries or industry sectors that are interrelated or have common risks, making it more susceptible to any economic, political, or regulatory developments or other risks affecting those industries and sectors. To the extent that a Fund is permitted to invest in foreign markets, emerging markets or countries with limited or developing markets such investments may subject the Fund to a greater degree of risk than in the U.S. market or a developed market. Risks associated with these foreign and developing markets include political, social or economic factors and may affect the price of a Fund’s investments and income generated by these investments, as well as a Fund’s ability to repatriate such amounts. Information regarding each Fund’s principal risks is contained in the Funds’ prospectus. Please refer to the Funds’ prospectus when considering a Fund’s risks.
2. Significant Accounting Policies
Each Fund’s financial statements have been prepared in conformity with U.S. generally accepted accounting principles. Those principals require the management of the Funds to, among other things, make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income, expenses and gains and losses on investments during the reporting year. Actual results could differ from those estimates.
The following is a summary of significant accounting policies followed by each Fund in the preparation of its financial statements, which are consistent with those policies generally accepted in the investment company industry.
Security Valuation
Portfolio securities are valued each business day generally at the last reported sale price on the principal exchange or market on which they are traded. If on a business day there is no such reported sale, the securities generally are valued at the mean between the last reported bid and asked prices. For securities, where no such sales have been reported, a Fund may value such securities at the last reported bid price. In the event that there is information suggesting that valuation of such securities based upon bid and/or asked prices may not be accurate, a Fund may value such securities in good faith at fair value in accordance with procedures (the “Valuation Procedures”) established by the Funds’ Trustees (the “Trustees”), which may include a determination to value such securities at the last reported sales price. Short-term investments that mature in 60 days or less are valued at amortized cost. Securities quoted in foreign currencies are translated into U.S. dollars based upon the prevailing exchange rate at the time of valuation. Other assets and securities for which no quotations are readily available are valued at fair value as determined in good faith using the Valuation Procedures. As a result, changes in the value of those currencies in relation to the U.S. dollar may affect a Fund’s net asset value. Because foreign markets may be open at different times than when the New York Stock Exchange is open for regular trading, the value of a Fund’s shares may change on days when shareholders are not able to buy or sell them. If events materially affecting the values of a Fund’s foreign investments occur between the close of foreign markets and the close of regular trading on the New York Stock Exchange, these investments may be valued at their fair value as determined in good faith using the Valuation Procedures.
The Funds’ Valuation Procedures include fair valuation accounting standards that establish an authoritative definition of fair value and set out a hierarchy for measuring fair value. These standards require additional disclosures about the various inputs used to develop the measurements of fair value. These inputs are summarized in the three broad levels listed below:
• Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities that a Fund has the ability to access.
• Level 2 — Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.
• Level 3 — Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available; representing a Fund’s own assumptions about the assumptions a market participant would use in valuing the asset liability, and would be based on the best information available.
The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of the markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.
The inputs used to measure fair value may fall into different levels of fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety, is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
Changes in valuation techniques may result in transfers in changing an investment’s assigned level within the hierarchy.
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in these securities. The following is a summary of the inputs used to value the Fund’s net assets as of March 31, 2014:
Quoted Prices In Active Markets | Significant Other Observable Inputs | Significant Unobservable Inputs | Market Value at March 31, 2014 | |
| Level 1 | Level 2 | Level 3 | Total | |
| Small Cap | ||||
| Common Stock* | $105,965,259 | $— | $— | $105,965,259 |
| Depository Receipts | 1,710,924 | — | — | 1,710,924 |
| Real Estate Inv. Trusts | 9,712,381 | — | — | 9,712,381 |
| Short Term Investments | 6,571,585 | 696,991 | — | 7,268,576 |
| Total | $123,960,149 | $696,991 | $— | $124,657,140 |
| Quality | ||||
| Common Stock* | $117,188,166 | $— | $— | $117,188,166 |
| Depository Receipts | 7,115,389 | — | — | 7,115,389 |
| Short Term Investments | 566,740 | 394,596 | — | 961,336 |
| Total | $124,870,295 | $394,596 | $— | $125,264,891 |
| Emerging Markets | ||||
| Common Stock* | $88,612,217 | $3,732,694 | $— | $92,344,911 |
| Common Stock Units | 784,871 | — | — | 784,871 |
| Depository Receipts | 12,130,720 | — | — | 12,130,720 |
| Mutual Funds | 37,488,707 | — | — | 37,488,707 |
| Preferred Stock | 3,390,240 | — | — | 3,390,240 |
| Real Estate Inv. Trusts | 359,911 | — | — | 359,911 |
| Short Term Investments | 7,428,337 | 2,090,917 | — | 9,519,254 |
| Total | $150,195,003 | $5,823,611 | $— | $156,018,614 |
| Risk Parity | ||||
| Common Stock* | $22,572,906 | $3,911,327 | $70,005 | $26,554,238 |
| Common Stock Units | 91,833 | — | — | 91,833 |
| Depository Receipts | 3,360,801 | — | — | 3,360,801 |
| Mutual Funds | 2,490,760 | — | — | 2,490,760 |
| Preferred Stock | 917,995 | — | — | 917,995 |
| Real Estate Inv. Trusts | 190,924 | — | — | 190,924 |
| Rights | — | 322 | — | 322 |
| Short Term Investments | 1,067,647 | 67,449 | — | 1,135,096 |
| Total | $30,692,866 | $3,979,098 | $70,005 | $34,741,969 |
| Foreign Value | ||||
| Common Stock* | $1,253,625,984 | $30,259,667 | $— | $1,283,885,651 |
| Depository Receipts | 96,326,152 | — | — | 96,326,152 |
| Short Term Investments | 99,429,471 | — | — | 99,429,471 |
| Total | $1,449,381,607 | $30,259,667 | $— | $1,479,641,274 |
| Foreign Value Small Cap | ||||
| Common Stock* | $155,260,719 | $7,082,690 | $81,523 | $162,424,932 |
| Preferred Stock | 3,414,708 | — | — | 3,414,708 |
| Short Term Investments | 14,514,506 | — | — | 14,514,506 |
| P-Notes* | — | 5,490,412 | — | 5,490,412 |
| Total | $173,189,933 | $12,573,102 | $81,523 | $185,844,558 |
The following is a reconciliation of Level 3 assets for which unobservable inputs were used to determine fair value.
Foreign Value | Foreign Value Small Cap Common Stock | Emerging Markets Common Stock | Risk Party Common Stock | |
| Balances as of 3/31/2013 | $— | $82,689 | $839,179 | $— |
| Realized gain (loss) | $(5,123,157) | $— | $— | $— |
| Changed in unrealized appreciation (depreciation) | $5,123,157 | $(1,166) | $(223,438) | $(6,894) |
| Purchases | $— | $— | $— | $76,899 |
| Sales | $— | $— | $(615,741) | $— |
| Transfer into Level 3 | $— | $— | $— | $— |
| Balances as of 3/31/2014 | $— | $81,523 | $— | $70,005 |
* Refer to Schedule of Investments for breakout by industry or country.
* Transfers between Levels are recognized at the end of the reporting period.
* Emerging Markets fund transferred $412,931 out of Level 1 into Level 2 and $2,494,637 out of Level 2 into Level 1. Foreign Value Fund transferred $29,635,728 out of Level 2 into Level 1. Foreign Value Small Cap Fund transferred $11,815,478 out of Level 2 into Level 1. Small Cap, Quality and Risk Parity Funds didn’t have transfers at period end. The reason for transfers between levels was due to the market closed in certain countries.
* Common stock and P-Notes labeled as Level 2 balance consists of the market value of the associated Level 2 investments in the following industries:
| Foreign Value | Foreign Value Small Cap | Emerging Markets | Risk Parity | |
| Automobiles | $— | $— | $— | $62,973 |
| Banks | — | 946,647 | 1,067,479 | 227,656 |
| Chemicals | — | — | 809,360 | 124,276 |
| Construction & Engineering | — | — | 101,385 | — |
| Construction Materials | — | — | — | 243,654 |
| Diversified Financials | — | 1,877,064 | 556,682 | 27,060 |
| Diversified Telecommunications | — | — | 550,492 | 78,295 |
| Electric Utilities | — | 1,946,209 | 212,730 | 182,737 |
| Electronic Equipment & Instruments | — | 2,616,268 | 190,058 | — |
| Food and Drug Retailing | — | — | — | 91,578 |
| Food Products | — | 3,910,418 | 244,508 | 220,068 |
| Gas Utilities | — | — | — | 158,487 |
| Health Care Providers & Services | — | — | — | 198,024 |
| Hotels, Restaurants & Leisure | — | — | — | 77,137 |
| Household Products | — | — | — | 70,808 |
| Industrial Conglomerates | — | — | — | — |
| Machinery | — | — | — | 113,248 |
| Media | — | — | — | 250,121 |
| Metals & Mining | — | 803,500 | — | — |
| Mining & Energy | — | — | — | 82,524 |
| Multiline Retail | — | — | — | 164,600 |
| Oil & Gas | $30,259,667 | $— | $— | $453,167 |
| Pharmaceuticals & Biotechnology | — | — | — | 151,531 |
| Real Estate | — | — | — | 151,455 |
| Software & Services | — | 472,996 | — | — |
| Specialty Retail | — | — | — | 65,290 |
| Tabacco | — | — | — | 65,229 |
| Transportation Infrastructure | — | — | — | 327,269 |
| Wireless Telecommunication Services | — | — | — | 324,140 |
| $30,259,667 | $12,573,102 | $3,732,694 | $3,911,327 |
* Common stock labeled as Level 3 balance consists of the market value of the associated Level 3 investments in the following industries:
Foreign Value Small Cap | Risk Parity | |
| Leisure Equipment & Products | $81,523 | $— |
| Telecommunication Services | — | 70,005 |
| $81,523 | $70,005 |
The following table presents additional information about valuation methodologies and inputs used for investments that are measured at fair value and categorized within Level 3 as of March 31, 2014;
Common Stock | Fair Value March 31, 2014 | Valuation Methodologies | Unobservable Input (1) | Input Value | Impact to Valuation from a Decrease in Input (2) |
| Foreign Value Small Cap | $81,523 | Market Comparable | Comparability Adjustment | $0.01 | Decrease |
| Risk Parity | $70,005 | Benchmark Prices | Benchmark Return Volatility | 102% | Decrease |
1. In determining certain of these inputs, management evaluates a variety of factors including economic conditions, industry and market developments, and company specific developments.
2. This column represents the directional change in the fair value of the Level 3 investments that would result from a decrease to the corresponding unobservable input. An increase to the observable input would have the opposite effect.
Offsetting Assets and Liabilities
The Funds have adopted financial reporting rules regarding offsetting assets and liabilities and related arrangements to enable users of their financial statements to understand the effect of those arrangements on their financial position. During the period ended March 31, 2014, the Funds were not subject to any master netting arrangements or similar agreements.
The table below shows the offsetting assets and liabilities relating to the repurchase agreement and the securities lending agreements shown on the Statement of Assets and Liabilities.
Gross Amounts not offset in the statement of Financial Position | ||||||
Repurchase Agreements | Gross Amounts of Recognized Assets | Gross Amounts Offset in the Statement of Financial Position | Net Amounts Presented in the Statement of Financial Position | Financial Instruments | Collateral Pledged (Received) | Net Amount |
| Small Cap | $696,991 | $— | $696,991 | $696,991 | $— | $— |
| Quality | 394,596 | — | 394,596 | 394,596 | — | — |
| Emerging Markets | 2,090,917 | — | 2,090,917 | 2,090,917 | — | — |
| Risk Parity | 67,449 | — | 67,449 | 67,449 | — | — |
Gross Amounts not offset in the statement of Financial Position | ||||||
| Security Lending | Gross Amounts of Recognized Liabilities | Gross Amounts Offset in the Statement of Financial Position | Net Amounts Presented in the Statement of Financial Position | Financial Instruments | Collateral Pledged (Received) | Net Amount |
| Small Cap | $6,571,585 | $— | $6,571,585 | $6,571,585(a) | $— | $— |
| Quality | 566,740 | — | 566,740 | 566,740(a) | — | — |
| Emerging Markets | 7,428,337 | — | 7,428,337 | 7,428,337(a) | — | — |
| Risk Parity | 1,067,647 | — | 1,067,647 | 1,067,647(a) | — | — |
(a) Collateral for securities on loan is included in the Schedule of Investments.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. 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 reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Guarantees and Indemnifications
In the normal course of business, the Funds enter into contracts with service providers that contain general indemnification clauses. The Funds’ maximum exposure under these arrangements 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 minimal.
Subsequent Events
In preparing these financial statements, the Funds have evaluated events and transactions for potential recognition or disclosure through the date the financial were issued. There were no events or transactions that occurred during the period that materially impacted the accounts or disclosures in the Funds’ financial statements.
Security Transactions and Related Investment Income
Security transactions are accounted for on the trade date (the date the order to buy or sell is executed). Dividend income, less foreign taxes withheld, is recorded on the ex-dividend date, except that certain dividends from foreign securities where the ex-dividend date may have passed are recorded as soon as a Fund becomes aware of the ex-dividend data in the exercise of reasonable diligence. Distributions received on securities that represent a return of capital or a capital gain is recorded as a reduction of cost of investments and/or as a realized gain. Each Fund estimates the components of distributions that may be considered nontaxable distributions or capital gain distributions for tax purposes. Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. In determining the net gain or loss on securities sold, the cost of securities is determined on the identified cost basis. Each Fund’s investment income and realized and unrealized gains and losses are allocated among classes based upon the daily relative net assets.
Repurchase Agreements
The Funds’ custodian takes possession of securities collateralizing repurchase agreements through the federal book-entry system. Collateral is marked-to-market daily to confirm that the market value of the underlying assets remains sufficient to protect the Funds. The Funds may experience costs and delays in liquidating the collateral if the issuer defaults or enters into bankruptcy.
Counterparty Credit Risk
Some transactions in which a Fund may engage involve instruments that are not traded on an exchange. Rather, these instruments are traded between counterparties based on contractual relationships. As a result, a Fund is subject to the risk that the counterparty will not perform obligations under the related contract. Although a Fund expects to enter into transactions only with counterparties believed by the Fund’s investment manager or Sub-Advisor to be creditworthy, there can be no assurance that a counterparty will not default and that the Fund will not sustain a loss on a transaction as a result.
The purchase of participatory notes involves risk that is in addition to the risks normally associated with a direct investment in the underlying securities. A Fund is subject to the risk that the issuer of the participatory note (i.e., the issuing bank or broker-dealer), which is the only responsible party under the note, is unable or refuses to perform under the terms of the participatory note.
Foreign Currency Transactions
All monetary items denominated in foreign currencies are translated into U.S. dollars based on the prevailing exchange rate at the close of each business day. Income and expenses denominated in foreign currencies are translated at the prevailing rates of exchange when accrued or incurred.
Reported net realized gains and losses on foreign currency transactions represent net gains and losses from currency gains and losses realized between the trade and settlement dates on investment transactions, and the difference between the amount of net investment income accrued and the U.S. dollar amount actually received. The effects of changes in foreign currency exchange rates on investments in securities are not segregated in the Statement of Operations from the effects of changes in market prices of those securities, but are included with the net realized and unrealized gain or loss on investments.
Forward Foreign Currency Contracts
The Funds may enter into forward foreign currency contracts to manage their exposure to fluctuations in certain foreign currencies. A forward currency contract is a commitment to purchase or sell a foreign currency at a future date at a set price. The forward currency contracts are valued at the forward rate and are marked-to-market daily. The change in market value is recorded by a Fund as an unrealized gain or loss. When the contract is closed, a Fund records a realized gain or loss equal to the difference between the value of the contract at the time it is opened and the value at the time it is closed. In addition to the risks of financial investments mentioned above, risks arise from unanticipated movements in currency values.
There were no open foreign currency contracts held by any Fund at March 31, 2014.
Securities Lending
To generate additional income, each of Small Cap, Quality, Emerging Markets and Risk Parity use Securities Finance Trust Company (“eSecLending”) as lending agent. Small Cap , Quality , Emerging Markets and Risk Parity may each lend up to 30 percent of its assets pursuant to certain agreements (“Securities Lending Agreements”) requiring that the loan be continuously secured by cash or securities. Securities loaned are arranged by eSecLending with certain pre-approved borrowers, typically broker-dealers acting on behalf of their clients. The borrowers are required to provide cash or securities as collateral against loaned securities in the amount of 105 percent of the market value of borrowings for Emerging Markets and Risk Parity, and 102 percent of the borrowings for the Small Cap and Quality. Collateral is marked-to-market daily. Cash collateral is invested in a registered money market fund.
Risks such as delay in recovery of securities may occur should the borrower of the securities fail financially or should the value of the securities loaned increase above the value of the collateral received. eSecLending provides indemnification insurance via highly rated third party insurers to cover these potential risks.
At March 31, 2014, the following Funds had collateral and loans outstanding of:
| Value of Collateral | Value of Loaned Securities | |
| Small Cap | $6,571,585 | $6,409,708 |
| Quality | 566,740 | 554,436 |
| Emerging Markets | 7,428,337 | 7,169,759 |
| Risk Parity | 1,067,647 | 1,020,113 |
Credit Facility
State Street has made available to the Trust an uncommitted unsecured demand line of credit in the amount of $15 million. State Street may look solely to the assets of the Fund for the enforcement of any claim against that Fund. For the year ended March 31, 2014, the average interest rate on the outstanding principal amount was 1.39%. During year ended March 31, 2014 Small Cap and Emerging Markets had an outstanding average daily loan balance of $2,361 and $82,386 respectively. The maximum amount outstanding for the current lending agreement during the period was $430,807 for Small Cap and $4,844,162 for Emerging Markets. Interest expense amounted to $33 and $1,155 respectively. As of September 4, 2013, the Trust did not renew this credit facility. Thus, at March 31, 2014 there were no loan payable balances for any of the Funds.
Expenses and Class Allocations
The majority of the expenses of the Funds are attributed to the individual Fund and Class for which they are incurred. Expenses that are not attributed to a specific Fund are allocated in proportion to the respective net assets of the Funds. Expenses allocable to a Fund are borne pro rata by the holders of both classes of shares of such Fund, except that 12b-1 Plan expenses will not be borne by the holders of Institutional Shares.
Distribution (12b-1) fees on Ordinary Shares are calculated based on the average daily net asset value attributable to the Ordinary Shares of the respective Fund. Institutional Shares are not subject to distribution (12b-1) fees. Shareholders of each class share all expenses and fees paid to the transfer agent, Pear Tree Institutional Services, for its services, which are allocated based on the net assets in each class and the ratable allocation of related out-of-pocket expenses. Income, common expenses and realized and unrealized gains and losses are calculated at the Fund level and allocated daily to each class of shares based on their respective percentage of adjusted net assets at the beginning of the day. (See Note 3.)
Distributions to Shareholders
Distributions to shareholders are recorded as of the ex-dividend date. Distributions paid by each Fund with respect to each class of shares are calculated in the same manner, at the same time, and in the same amount, except that Ordinary Shares incur distribution (12b-1) fees while Institutional Shares do not. Distributions from net investment income for each Fund, if any, are declared and paid annually. Distributions from net realized gains for each Fund, if any, are generally declared and paid annually.
3. Management Fee, Advisory Contracts and Other Affiliate Transactions
The Funds have entered into a management agreement (the “Management Agreement”) with Pear Tree Advisors, Inc. (the “Manager”). Compensation of the Manager, for management and administration of the Funds, including selection and monitoring of the portfolio advisors, is paid monthly based on the average daily net asset value of each Fund for the month. The annual rate of such fees is 1.00 percent of the average daily total net assets of each of the Funds except for Risk Parity an annual rate 0.60 percent of the average daily total net assets.
From January 27, 2011 to November 30, 2013, the Manager had waived a portion of its management fee relating to Quality Fund by an amount equal to the annualized rate of 0.15 percent of Quality Fund’s average daily net assets if and when the Quality Fund’s average daily net assets were up to $100 million, and in an amount equal to the annualized rate of 0.25 percent of Quality Fund’s average daily net assets if and when Quality Fund’s average daily net assets equal to or greater than $100 million. From April 1, 2011 to July 31, 2013, the Manager had waived or reimbursed Fund expenses relating to Institutional Shares of Quality Fund such that the total annualized fund operating expenses relating to Institutional Shares were not more than 1.00 percent.
Beginning December 1, 2013, the Manager has agreed until July 31, 2014 to waive a portion of its management fee relating to Quality Fund by an amount equal to the annualized rate of 0.25 percent of Quality Fund’s average daily net assets if and when the Quality Fund’s average daily net assets up to and including $125 million, and in an amount equal to the annualized rate of 0.50 percent of Quality Fund’s average daily net assets if and when Quality Fund’s average daily net assets in excess of $125 million. The Board has the right to terminate this arrangement in its discretion.
In addition, under the Management Agreement, the Manager has agreed to reduce its compensation, and if necessary, assume expenses, with respect to Small Cap Fund to the extent that the total expenses of Small Cap Fund individually exceed 2 percent of average net assets for any fiscal year. Small Cap Fund expenses subject to this limitation are exclusive of brokerage, interest, taxes and extraordinary expenses, which include incremental custody costs associated with international securities. Expenses are calculated gross of custody credits, if applicable.
For the twelve months ended March 31, 2014, aggregate management fees exclusive of fee waivers and Fund reimbursements, from all Funds were $16,297,656.
The Manager has entered into sub-advisory contracts with the following sub advisors (collectively the “Sub-Advisors”) to provide investment sub-advisory services to the following Funds: Columbia Partners, L.L.C., Investment Management (Small Cap and Quality), PanAgora Asset Management, Inc. (Emerging Markets and Risk Parity), and Polaris Capital Management, LLC (Foreign Value and Foreign Value Small Cap).
For services rendered, the Manager pays to the Sub-Advisors of a Fund a fee based on a percentage of the average daily total net assets of the Fund. The fee for each Fund is determined separately. Currently, the fees paid by the Manager to the Sub-Advisors of the Funds are as follows:
| Small Cap | 0.47% of average daily total net assets |
| Quality | 0.10% of the first $100 million and |
| 0.08% of amounts in excess of $100 million but less than $250 million and | |
| 0.06% of amounts in excess of $250 million of average daily total net assets | |
| Emerging Markets | 0.47% of the first $300 million and |
| 0.50% of amounts in excess of $300 million of average daily total net assets | |
| Risk Parity | 0.25% of the first $300 million and |
| 0.30% of amounts in excess of $300 million but less than $600 million and | |
| 0.35% of amounts in excess of $600 million of average daily total net assets | |
| Foreign Value | 0.35% of the first $35 million and |
| 0.40% of amounts in excess of $35 million but less than $200 million and | |
| 0.50% of assets in excess of $200 million of average daily total net assets | |
| Foreign Value Small Cap | 0.35% of the first $35 million and |
| 0.40% of amounts in excess of $35 million but less than $200 million and | |
| 0.50% of amounts in excess of $200 million of average daily total net assets. |
The Funds have entered into a distribution agreement (the “Distribution Agreement”) with U.S. Boston Capital Corporation (the “Distributor”). For its services under the Distribution Agreement, the Distributor receives the distribution (12b-1) fees, that is, 0.25 percent of the average daily net asset value of the Ordinary Shares of the Funds, payable monthly.
Holders of Institutional Shares pay no portion of the 12b-1 Plan expenses of the Funds and are not entitled to vote on matters involving the 12b-1 Plan. During the year ended March 31, 2014 the aggregate distribution fees of the Funds were $3,212,941.
Transfer agent functions are provided to the Funds by Pear Tree Institutional Services, a division of the Manager (the “Transfer Agent”) pursuant to a transfer agent agreement (the “Transfer Agent Agreement”). The Transfer Agent Agreement provides for base fees that are payable to the Transfer Agent at an annual rate of 0.16 percent of the average daily total net asset value of each class of shares of the Funds and for reimbursement of out of pocket expenses. During the year ended March 31, 2014, the aggregate fees of the Funds were $2,708,266.
Pursuant to an Administration Agreement, the Manager provides certain administrative services to the Funds. During the year ended March 31, 2014, fees paid pursuant to this agreement were $477,335.
The Trustees have approved reimbursement to the Manager for a percentage of the compensation paid by the Manager to the Trust’s Chief Compliance Officer. For the year ended March 31, 2014, the Trust reimbursed the Manager for the Chief Compliance Officer’s compensation in the amount of $192,791.
Custody and fund accounting services are provided by State Street. Custody credits generated by interest earned on un-invested cash balances maintained by the Funds are used to offset custodial expenses of the Funds.
For the year ended March 31, 2014, each Trustee who was not an “interested person” of the Trust, as that term is defined in the 1940 Act, received a fee for serving in that role of $28,000, and each of the Chairman of the Board’s Audit Committee and the Lead Independent Trustee of the Board received an additional $3,000. Compensation for the services of the Trustee who was an interested person of the Trust during that period was paid by the Manager. All fees paid to the Trustees were allocated among the Funds in proportion to their respective net assets.
As of March 31, 2014, the market value of all securities of affiliated companies held in Emerging Markets Fund amounted to $32,910,247, representing 22.4% of net assets.
| Affiliate | Share Balance 3/31/13 | Purchases | Sales | Share Balance 3/31/14 | Realized Gain (Loss) | Dividend Income | Value at 3/31/14 | Acquisition Cost |
| Risk Parity | — | 3,179,734 | — | 3,179,734 | — | $177,366 | $32,910,247 | $32,104,404 |
4. Purchases and Sales
During the twelve months ended March 31, 2014, purchases of investment securities other than U.S. Government obligations and short-term investments for Small Cap, Quality, Emerging Markets, Risk Parity, Foreign Value, and Foreign Value Small Cap, were $77,898,275, $47,930,013, $90,005,412, $44,771,621, $429,896,406, and $43,448,443 respectively. Sales of such securities for the Funds were $93,195,970, $39,814,721, $88,260,487, $12,132,541, $27,395,803, and $4,944,210 respectively.
5. Contingent Liability
The Trust maintains a joint fidelity bond with the Funds’ Transfer Agent through ICI Mutual Insurance Company (“ICI Mutual”). The annual premium is allocated among the Funds and the Transfer Agent. Additionally, the Funds have committed to ICI Mutual up to 300 percent of the annual premium, one-third of which was provided in cash, with each Fund’s pro rata portion recorded as an asset. The remainder is secured with an irrevocable letter of credit.
6. Concentration of Risk
The relatively large investments of Emerging Markets and Risk Parity in countries with limited or developing capital markets may involve greater risks than investments in more developed markets and the prices of such investments may be volatile. The consequences of political, social or economic changes in these markets may have disruptive effects on the market prices of each Fund’s investments and the income they generate, as well as each Fund’s ability to repatriate such amounts.
7. Federal Income Taxes
It is the policy of the Funds to distribute all of their taxable income within the prescribed time and otherwise comply with the provisions of the Internal Revenue Code (“IRC”) applicable to regulated investment companies. Therefore no Federal income tax provision is required.
The tax components of capital shown in the following tables represent: (1) losses or deductions the portfolios may be able to offset against income and gains realized in future years, (2) distribution requirements the portfolios must satisfy under the income tax regulations, and (3) unrealized appreciation or depreciation of investments for federal income tax purposes.
Certain Funds had capital loss carryovers at March 31, 2014. The accumulated capital losses noted in the table may be available to offset future realized capital gains and thereby reduce future taxable gain distributions.
| March 31, 2014 | ||||||
| Portfolio | Capital Loss Expires March 31, 2017 | Capital Loss Expires 2018 | Capital Loss Expires 2019 | Capital Loss No Expiration Short Term | Capital Loss No Expiration Long Term | Total Capital Loss |
| Small Cap | $— | $— | $— | $— | $— | $— |
| Quality | — | — | — | — | — | — |
| Emerging Markets | — | 18,933,192 | — | — | — | 18,933,192 |
| Risk Parity | — | — | — | — | — | — |
| Foreign Value | 73,956,484 | 131,156,114 | 10,547,106 | — | 39,035,597 | 254,695,301 |
| Foreign Value Small Cap | — | — | — | 452,699 | 2,279,694 | 2,732,393 |
As a result of the passage of the Registered Investment Company Modification Act of 2010 (“the Act”), losses incurred in fiscal year ended March 31, 2013 and beyond retain their character as short-term or long-term and have no expiration date and are utilized before capital losses incurred prior to the Act.
The Funds recognize the tax benefits of uncertain tax positions only where the position is “more likely than not” to be sustained assuming examination by the tax authorities. Management has analyzed the Funds’ tax positions, and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on returns filed for open tax years 2011-2013, or expected to be taken in the Funds’ 2014 tax returns. The Funds identify their major tax jurisdictions as U.S. Federal and Massachusetts State; however the Funds are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months.
The primary differences between book and tax appreciation or depreciation of investments consist of wash sale loss deferrals, return of capital distributions by real estate investment trusts (“REITs”), mark to market on passive foreign investment companies (“PFICs”) held and foreign capital gains taxes accrued. The net tax appreciation/ (depreciation) in the table below includes unrealized tax gain/ (loss) on foreign currency and investments.
| March 31, 2014 | ||||||
| Portfolio | Undistributed Ordinary Income | Undistributed Long-Term Gains | Accumulated Capital Losses | Other Loss Deferrals | Net Tax Appreciation/ (Depreciation) | Total |
| Small Cap Fund | $— | $7,298,318 | $— | $(408,943) | $32,915,761 | $39,805,136 |
| Quality Fund | 360,382 | 3,892,858 | — | — | 21,356,355 | 25,609,595 |
| Emerging Markets Fund | 2,048,059 | — | (18,933,192) | (329,457) | 637,021 | (16,577,569) |
| Risk Parity | 33,618 | — | — | (99,909) | 840,135 | 773,844 |
| Foreign Value Fund | 18,934,253 | — | (254,695,301) | — | 332,659,729 | 96,898,681 |
| Foreign Value Small Cap Fund | 1,060,468 | — | (2,732,393) | — | 57,965,181 | 56,293,256 |
* Ordinary Loss Deferrals for Small Cap $(408,943), Emerging Markets $(329,457), and Risk Parity $(50,057).
At March 31, 2014, the tax composition of dividends was as follows:
| Portfolio | Ordinary Income | Long Term Capital Gains | Tax Return Of Capital |
| Small Cap Fund | $— | $— | $— |
| Quality Fund | 1,269,533 | — | — |
| Emerging Markets Fund | 1,941,264 | — | — |
| Risk Parity | 182,798 | — | — |
| Foreign Value Fund | 8,908,564 | — | — |
| Foreign Value Small Cap Fund | 1,491,443 | — | — |
At March 31, 2013, the tax composition of dividends was as follows:
| Portfolio | Ordinary Income | Long Term Capital Gains | Tax Return Of Capital |
| Small Cap Fund | $— | $— | $— |
| Quality Fund | 1,041,096 | — | — |
| Emerging Markets Fund | 2,218,370 | — | — |
| Foreign Value Fund | 4,232,893 | — | — |
| Foreign Value Small Cap Fund | 1,676,964 | — | — |
Accounting principles generally accepted in the United States require that certain components of net assets be reclassified between financial and tax reporting. These reclassifications have no effect on net assets or net asset value per share. For the year ended March 31, 2014, permanent differences in book and tax accounting have been reclassified to shares of beneficial interest, undistributed/(over-distributed) net investment income and accumulated net realized gain/(loss) on investments and foreign denominated assets, liabilities and currency.
| Increase/(Decrease) | |||
Shares of Beneficial Interest | Undistributed/ Accumulated Net Investment Income | Accumulated Net Gain/ (Loss) on Investments and Foreign Denominated Assets, Liabilities and Currency | |
| Small Cap Fund | $(321,690) | $264,455 | $57,235 |
| Quality Fund | — | (331) | 331 |
| Emerging Markets Fund | (73,880) | (64,578) | 138,458 |
| Risk Parity | — | (26,708) | 26,708 |
| Foreign Value Fund | — | 425,145 | (425,145) |
| Foreign Value Small Cap Fund | — | (287,848) | 287,848 |
The permanent differences primarily relate to net operating losses, return of capital distributions by real estate investment trusts (REITs), foreign currency reclasses and adjustments for sale of shares in passive foreign investment corporations (PFICs).
8. Transactions in Shares of Beneficial Interest
Transactions in shares of beneficial interest were as follows:
Year ended March 31, 2014 | Year ended March 31, 2013 | |||
| Shares | Dollars | Shares | Dollars | |
| Small Cap | ||||
| Ordinary Shares | ||||
| Shares sold | 207,644 | $5,277,165 | 397,277 | $8,042,906 |
| Shares issued in reinvestment of distributions | — | — | — | — |
| Shares redeemed | (822,157) | (22,348,313) | (604,482) | (12,206,925) |
| Net Change | (614,513) | (17,071,148) | (207,205) | (4,164,019) |
| Institutional Shares | ||||
| Shares sold | 12,410 | $378,835 | 110,070 | $2,615,413 |
| Shares issued in reinvestment of distributions | — | — | — | — |
| Shares redeemed | (13,518) | (386,202) | (67,472) | (1,642,916) |
| Net Change | (1,108) | (7,367) | 42,598 | 972,497 |
| Total Net Change For Fund | $(17,078,515) | $(3,191,522) | ||
| Quality | ||||
| Ordinary Shares | ||||
| Shares sold | 537,932 | $9,087,468 | 1,087,154 | $15,630,714 |
| Shares issued in reinvestment of distributions | 63,544 | 1,110,117 | 66,925 | 969,079 |
| Shares redeemed | (440,986) | (7,508,887) | (1,428,820) | (20,306,550) |
| Net Change | 160,490 | 2,688,698 | (274,741) | (3,706,757) |
| Institutional Shares | ||||
| Shares sold | 408,428 | $7,172,744 | 94,140 | $1,452,652 |
| Shares issued in reinvestment of distributions | 6,245 | 114,089 | 2,284 | 34,560 |
| Shares redeemed | (100,210) | (1,818,592) | (51,833) | (801,346) |
| Net Change | 314,463 | 5,468,241 | 44,591 | 685,866 |
| Total Net Change For Fund | $8,156,939 | $(3,020,891) | ||
| Emerging Markets | ||||
| Ordinary Shares | ||||
| Shares sold | 1,175,343 | $25,995,414 | 1,084,432 | $24,063,148 |
| Shares issued in reinvestment of distributions | 70,627 | 1,594,063 | 79,817 | 1,831,797 |
| Shares redeemed | (1,245,560) | (27,432,553) | (1,616,028) | (35,835,496) |
| Net Change | 410 | 156,924 | (451,779) | (9,940,551) |
| Institutional Shares | ||||
| Shares sold | 154,168 | $3,421,496 | 171,805 | $3,943,602 |
| Shares issued in reinvestment of distributions | 9,313 | 212,884 | 10,116 | 235,107 |
| Shares redeemed | (114,842) | (2,577,228) | (224,737) | (5,129,602) |
| Net Change | 48,639 | 1,057,152 | (42,816) | (950,893) |
| Total Net Change For Fund | $1,214,076 | $(10,891,444) | ||
| Risk Parity | ||||
| Ordinary Shares | ||||
| Shares sold | 70,156 | $753,840 | ||
| Shares issued in reinvestment of distributions | 438 | 4,528 | ||
| Shares redeemed | (7,285) | (74,439) | ||
| Net Change | 63,309 | 683,929 | ||
| Institutional Shares | ||||
| Shares sold | 3,181,726 | $32,122,316 | ||
| Shares issued in reinvestment of distributions | 17,174 | 178,270 | ||
| Shares redeemed | (3,550) | (36,074) | ||
| Net Change | 3,195,350 | 32,264,512 | ||
| Total Net Change For Fund | $32,948,441 | |||
| Foreign Value | ||||
| Ordinary Shares | ||||
| Shares sold | 21,931,311 | $386,244,629 | 20,220,091 | $294,062,327 |
| Shares issued in reinvestment of distributions | 374,600 | 6,813,973 | 198,468 | 2,881,757 |
| Shares redeemed | (19,985,661) | (354,918,248) | (4,177,814) | (58,836,804) |
| Net Change | 2,320,250 | 38,140,354 | 16,240,745 | 238,107,280 |
| Institutional Shares | ||||
| Shares sold | 19,059,639 | $343,017,621 | 5,147,715 | $71,138,617 |
| Shares issued in reinvestment of distributions | 99,730 | 1,813,084 | 79,411 | 1,152,265 |
| Shares redeemed | (1,105,857) | (19,315,749) | (1,034,703) | (14,583,083) |
| Net Change | 18,053,512 | 325,514,956 | 4,192,423 | 57,707,799 |
| Total Net Change For Fund | $363,655,310 | $295,815,079 | ||
| Foreign Value Small Cap | ||||
| Ordinary Shares | ||||
| Shares sold | 2,664,639 | $32,447,208 | 1,422,737 | $13,550,210 |
| Shares issued in reinvestment of distributions | 94,569 | 1,108,351 | 135,381 | 1,288,830 |
| Shares redeemed | (1,096,688) | (12,449,928) | (784,949) | (7,360,895) |
| Net Change | 1,662,520 | 21,105,631 | 773,169 | 7,478,145 |
| Institutional Shares | ||||
| Shares sold | 1,783,652 | $22,200,645 | 748,064 | $7,209,029 |
| Shares issued in reinvestment of distributions | 30,571 | 358,593 | 21,654 | 206,143 |
| Shares redeemed | (355,757) | (4,138,242) | (911,896) | (8,411,674) |
| Net Change | 1,458,466 | 18,420,996 | (142,178) | (996,502) |
| Total Net Change for Fund | $39,526,627 | $6,481,643 | ||
Federal Tax Information (unaudited)
Designation Requirements at March 31, 2014
| Qualified Dividend Income Percentage | |
| Quality Fund | 100% |
| Emerging Markets Fund | 100% |
| Risk Parity Fund | 90% |
| Foreign Value Fund | 100% |
| Foreign Value Small Cap Fund | 100% |
The Funds may elect to pass through under section 853 of the Internal Revenue Code foreign tax credit to its shareholders for the year ended March 31, 2014. The total amount of foreign taxes that is expected to pass through to shareholders and the respective foreign source income are as follows:
| Foreign Tax Credit | Foreign Source Income | |
| Emerging Market Fund | 508,120 | 4,824,750 |
| Risk Parity Fund | 45,033 | 375,533 |
| Foreign Value Fund | 3,233,793 | 33,186,923 |
| Foreign Value Small Cap | 506,016 | 3,775,356 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and Trustees of the Pear Tree Funds
We have audited the accompanying statements of assets and liabilities of the Pear Tree Columbia Small Cap Fund, Pear Tree Quality Fund, Pear Tree PanAgora Dynamic Emerging Markets Fund, Pear Tree PanAgora Risk Parity Emerging Markets Fund, Pear Tree Polaris Foreign Value Fund, and Pear Tree Polaris Foreign Value Small Cap Fund, each a series of the Pear Tree Funds (“the Funds”), including the schedules of investments, as of March 31, 2014, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended except for the Pear Tree PanAgora Risk Parity Emerging Markets Fund in which the statement of operations, the statement of changes in net assets, and the financial highlights were for the period June 27, 2013 (commencement of operations) through March 31, 2014. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits 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 and financial highlights are free of material misstatement. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion. 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, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of March 31, 2014 by correspondence with the custodian and brokers or by other appropriate auditing procedures where replies from brokers were not received. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of the above mentioned series of the Pear Tree Funds, as of March 31, 2014, the results of their operations, the changes in their net assets, and the financial highlights for the periods indicated above, in conformity with accounting principles generally accepted in the United States of America.
TAIT, WELLER & BAKER LLP
Philadelphia, Pennsylvania
May 30, 2014
PEAR TREE FUNDS
INFORMATION FOR SHAREHOLDERS (unaudited)
Quarterly Portfolio Disclosure
Each Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (“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 and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (Call 1-800-SEC-0330 for more information). For a complete list of a fund’s portfolio holdings, you may also view the most recent monthly holdings report, semi-annual report or annual report on the Pear Tree Funds’ web site at www.peartreefunds.com.
Portfolio Proxy Voting Policies and Information
Information on the Funds’ proxy voting policies and on how the Pear Tree Funds voted proxies related to portfolio securities for the 12-month period ended June 30, 2013 is available without charge online at www.peartreefunds.com and at www.sec.gov. You may also call 1-800-326-2151 to request a free copy of the proxy voting information or the proxy voting policies.
Household Delivery of Fund Documents
With your consent, the Trust may send a single proxy statement, prospectus and shareholder report to your residence for you and any other member of your household who has an account with the Funds. If you wish to revoke your consent to this practice, you may do so by notifying the Fund’s transfer agent, by phone or in writing (see “For Account Information”). The mailing of separate proxy statements, prospectuses and shareholder reports will begin within 30 days after receiving your notice.
MANAGEMENT CONTRACT AND ADVISORY
CONTRACT APPROVAL (unaudited)
The Trustees, including the Independent Trustees voting separately, considered and approved the new Sub-Advisory agreement between the Manager and PanAgora relating to Emerging Markets Fund and Risk Parity Fund (the “New Agreement”) at a meeting of Trustees held on November 7, 2013. A change of control had occurred in the ownership of PanAgora causing the previous Sub-Advisory Agreements between the Manager and PanAgora relating to the Funds (the “Prior Agreements”) to terminate.
In connection with the meeting, the Trustees reviewed information and written materials from the Manager and PanAgora, including information from the Manager and PanAgora presented to the Trustees in connection with their May 16, 2013 meeting at which they considered and approved the Prior Agreements. That information and written materials presented to the Trustees in connection with the May 16, 2013 and November 7, 2013 meetings collectively included information regarding (a) the nature and quality of the services provided by PanAgora under the Prior Agreements and to be provided under the New Agreements, including the experience and qualifications of the personnel providing such services; (b) PanAgora’s financial condition, history of operations and ownership structures; (c) PanAgora’s brokerage and soft dollar practices; (d) PanAgora’s investment strategies and styles of investing for the Funds; (e) a summary of PanAgora’s risk management and compliance policies and procedures, including its code of ethics, and the evaluation by Pear Tree Funds’ Chief Compliance Officer of PanAgora’s policies and procedures; (f) PanAgora’s conflicts of interest, if any, in managing the Funds; and (g) the terms of the Prior Agreements and the New Agreements. The Trustees also considered certain representations made by PanAgora to the Manager with respect to PanAgora’s ability to continue to provide advisory and management services under the New Agreements with no material changes in operating conditions.
In evaluating the New Agreements, the Trustees gave weight to various factors, including the Manager’s evaluation of PanAgora and its recommendation, but they did not identify any single factor as controlling their decision.
Nature, Extent and Quality of Services
The Trustees considered the information and evaluations provided by the Manager with respect to PanAgora’s operations, qualifications and experience in managing the types of strategies for which PanAgora had been engaged under the Prior Agreements. The Trustees also reviewed the evaluation by the Pear Tree Funds’ Chief Compliance Officer of PanAgora’s compliance program, noting that the Chief Compliance Officer believed that program to be satisfactory. The Trustees also noted that the terms of the New Agreements are substantially similar to the terms of the Prior Agreements, and that the services that PanAgora would be expected to provide under the New Agreements would not be different from the services that it had provided under the Prior Agreements. The Trustees concluded that PanAgora would be able to provide quality investment advisory services to each Fund under the New Agreements.
Fees, Expenses and Performance
With respect to the sub-advisory fees, the Trustees considered that under the New Agreements, PanAgora would continue to be paid by the Manager out of the Manager’s management fees and not by the Funds. The Trustees also considered that the sub-advisory fees payable to PanAgora under the New Agreements would be calculated using the same rates as under the Prior Agreements. Based in part on certain representations by the Manager to the Trustees, the Trustees concluded that the fee rates under the Prior Agreements had been negotiated at arm’s length. The Trustees also considered the Manager’s determination that the fees to be paid to PanAgora under the New Agreements were reasonable in light of the anticipated quality of services to be provided by PanAgora under the New Agreements.
The Trustees did not consider the projected profitability for PanAgora under the New Agreements as they did not consider it to be particularly relevant because the Manager would be paying PanAgora out of its investment management fees. The Trustees therefore concluded that the Manager had an incentive to negotiate the lowest possible sub-advisory fees with PanAgora.
The Trustees considered and evaluated the past performance information presented with respect to the Funds and the Manager’s evaluation of that performance. This information was compared to performance information with respect to Funds’ applicable benchmarks. The Trustees concluded based upon the information provided, that overall PanAgora had satisfactory prior performance records with respect to the Funds.
Economies of Scale
The Trustees reviewed information prepared by the Manager that showed that the levels of aggregate sub-advisory fee rates increased as the Funds’ assets increased. The Trustees noted the Manager’s explanation that these fee rate structures had the same effect as if PanAgora had determined to waive its fees. Moreover, the Trustees noted that in the case of Risk Parity Fund, the rates used in calculating the management fee payable to the Manager under the Management Contract also increased as assets increased. However, the Trustees generally considered economies of scale with respect to the Funds primarily at the investment management level, rather than the sub-adviser level, given that the Manager would be paying PanAgora out of its investment management fees.
Other Benefits
The Trustees considered other benefits to be derived as a result of PanAgora’s relationship with the Funds. These benefits include research in connection with brokerage commissions paid by the Funds.
Based on the Trustees’ deliberations and the recommendations by the Manager, the Trustees concluded that the fees proposed to be paid to PanAgora under the New Agreements were reasonable in light of the services to be provided by it, and that each New Agreement should be approved.
PRIVACY NOTICE
| WHAT DO WE DO WITH YOUR PERSONAL INFORMATION? | ||
| Why? | Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share and protect your personal information. Please read this notice carefully to understand what we do. | |
| What? | The types of personal information we collect and share depend on the product or service you have with us. This information can include: • Social Security Numbers • Names, Addresses and Telephone numbers • Account Balances • Account Transactions • Transaction History • Information regarding your investments in the Pear Tree Mutual Funds • Other account information | |
| How? | All financial companies need to share customers’ personal information to run their everyday business. In the section below, we list the reasons financial companies can share their customers’ personal information; the reason Pear Tree chooses to share and whether you can limit this sharing. | |
| Reasons we can share your personal information | Do we share? | Can you limit this sharing? |
For our everyday business purposes Such as to process your transaction, maintain your account(s), respond to court orders and legal investigations, or report to credit bureaus | Yes | No |
For our marketing purposes To offer our products and services to you | No | We don’t share |
| For joint marketing with other financial companies | No | We don’t share |
For our affiliates’ everyday business purposes Information about your transactions and experiences | No | We don’t share |
For our affiliates’ everyday business purposes Information about your creditworthiness | No | We don’t share |
| For non-affiliates to market to you | No | We don’t share |
| Questions? | CALL 1-800-326-2151 |
| Who is providing this notice? |
Pear Tree Advisors, Inc. and its Affiliates (collectively “Pear Tree”). Our affiliates include the following entities: • Pear Tree Advisors, Inc. • Pear Tree Funds • Pear Tree Partners, LP • U.S. Boston Capital Corporation We do not share inforation among our affiliates for marketing purposes. |
| What we do | |
| How does Pear Tree protect my personal information? | To protect your personal information from unauthorized access and use, we use security measures that comply with federal law. These include computer safeguards and secured files and buildings. |
| How does Pear Tree collect my personal information? | We collect your personal information, for example, when you: • Open an account • Send us a check or wire Provide account information • Give us your contact information • Transfer assets from another firm |
| Why can’t I limit all sharing? | Federal law gives you the right to limit some but not all sharing related to: • Affiliates’ everyday business purposes — information about your creditworthiness • Affiliates from using your information to market to you • Non-affiliates to market to you. State laws and individual companies may give you additional rights to limit sharing. |
| Definitions | |
| Affiliates | Companies related by common ownership or control. They can be financial and nonfinancial companies. • Pear Tree does not share your information with affiliates to enable their marketing efforts. |
| Non-affiliates | Companies not related by common ownership or control. They can be financial and nonfinancial companies. • Pear Tree does not share with non-affiliates to enable their marketing efforts. |
| Joint marketing | A formal agreement between non-affiliated financial companies that together market financial products or services to you. • Pear Tree does not participate in joint marketing efforts |
TRUSTEES AND OFFICERS
The tables below identify the current Trustees and officers of the Trust, their ages, their present positions with the Trust, terms of office with the Trust and length of time served, principal occupations over at least the last five years and other directorships/trusteeships held. Each Trustee and officer holds office for an indefinite term until his or her successor is chosen and qualified or until his or her earlier death, resignation, retirement or removal. The mailing address of each of the Trustees and Officers of the Trust is 55 Old Bedford Road, Suite 202, Lincoln, Massachusetts 01773.
Messrs. Armstrong, Bulbrook, Dunlap and Marshall are members of the Funds’ Audit Committee. Mr. Marshall is the Chair of the Audit Committee. The Fund’s Statement of Additional Information (“SAI”) includes additional information about the Fund Trustees and is available without charge, upon request. To obtain a free copy of the current SAI, please access the Funds’ web site at www.peartreefunds.com or call shareholder services at 1-800-326-2141.
Trustees who are not Interested Persons of the Trust
The following individuals are Trustees of the Trust (each, a “Trustee”), but not “interested persons” of the Trust, as that term is defined in the 1940 Act.
Name and Age | Position Held With Trust | Term of Office/ Length of Time Served | Principal Occupation(s) during Past Five Years | Number of Portfolios in Fund Complex Overseen | Other Directorships Held by Trustee in Public Companies |
| Robert M. Armstrong (75) | Trustee | Indefinite Term (1985 to present) | Independent Director and Consultant Services (1998–Present) | 6 | NewPage Corporation (2006–2012); NewPage Holding Corporation (2006–2012); NewPage Group, Inc. (2006–2012) |
John M. Bulbrook (71) | Trustee | Indefinite Term (1985 to present) | CEO and Treasurer, John M. Bulbrook Insurance Agency, Inc. (dba/Bulbrook/Drislane Brokerage) (distributor of financial products, including insurance) (1984–Present); | 6 | None |
William H. Dunlap (63) | Trustee | Indefinite Term (October 2006 to present) | Executive Director, New Hampshire Historical Society, (Feb. 2010–Present); Principal, William H. Dunlap & Company (consulting firm) (2005–Present); President, EQ Rider, Inc., (equestrian clothing sales) (1998–2008); Director, Merrimack County Savings Bank (2005–Present); Director, Merrimack Bank Corp. (2005–Present) | 6 | None |
| Clinton S. Marshall (56) | Trustee | Indefinite Term (April 2003 to present) | Owner, Coastal CFO Solutions, outsource firm offering CFO solutions to businesses (1998–Present); CFO, Fore River Company (2002–Present) | 6 | None |
Trustees and Officers who are Interested Persons of the Trust
The following individuals are Trustees or officers of the Trust who are “interested persons” of the Trust, as that term is defined in the 1940 Act.
Name and Age | Position Held With Trust | Term of Office/ Length of Time Served | Principal Occupation(s) during Past Five Years | Number of Portfolios in Fund Complex Overseen | Other Directorships Held by Trustee/Officer in Public Companies |
| Willard L. Umphrey* (72) | Trustee, President, Chairman (1985 to present) | Indefinite Term (1985 to present) | Director, U.S. Boston Capital Corporation; President, Pear Tree Advisors, Inc. | 6 | U.S. Boston Corporation; U.S. Boston Asset Management Corporation; Pear Tree Advisors, Inc.; Pear Tree Partners Management LLC; USB Corporation; Sugarbush Solutions, Inc. USB Atlantic Associates, Inc.; USB Greenville-86, Inc.; U.S. Boston Insurance Agency, Inc.; U.S. Boston Capital Corporation, Woundchek Laboratories, Unidine Corporation |
| Leon Okurowski (71) | Vice President, Treasurer (1985 to present) | (1985 to present) | Director and Vice President, U.S. Boston Capital Corporation; Treasurer, Pear Tree Advisors, Inc.; Trustee, Pear Tree Funds (4/17/1985–9/30/2004) | N/A | Everest USB Canadian Storage, Inc.; Pear Tree Advisors, Inc.; U.S. Boston Corporation; U.S. Boston Asset Management Corporation; USB Greenville-86, Inc. MedCool, Inc., Sugarbush Solutions, Inc.; USB Corporation; USB Everest Management, LLC; USB Everest Storage LLC; USB Atlantic Associates, Inc.; U.S. Boston Insurance Agency, Inc.; U.S. Boston Capital Corporation; Woundchek Laboratories |
| Deborah A. Kessinger (50) | Assistant Clerk and Chief Compliance Officer | (April 2005 to Present) | Senior Counsel (since 9/04), President (since 8/07) and Chief Compliance Officer (since 12/05), U.S. Boston Capital Corporation; Senior Counsel (since 9/2004) and Chief Compliance Officer (since 10/2006), Pear Tree Advisors, Inc.; Chief Compliance Officer and General Counsel, Wainwright Investment Counsel, LLC (investment management firm) (2000–2004); Compliance Attorney, Forefield, Inc. (software provider) (2001–2004) and Compliance Consultant (2007 to present) | N/A | None |
Diane Hunt (52) | Assistant Treasurer | (June 2010 to Present) | Controller (Since 3/2010) Pear Tree Advisors, Inc.; Accountant (Since 1984) U.S. Boston Capital Corporation | N/A | None |
Kelly Lavari (46) | Clerk | (November 2010 to May Present) | Regulatory Compliance Manager (since April 2008), Legal and Compliance Associate (4/2005–4/2008) Pear Tree Advisors, Inc. | N/A | None |
* Trustee has been determined to be an “Interested Trustee” by virtue of, among other things, affiliation with one or more of the trust, the Funds’ investment advisor, Pear Tree Advisors and the Funds’ distributor, U.S. Boston Capital Corporation.
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SERVICE PROVIDERS
| Manager | Pear Tree Advisors, Inc., 55 Old Bedford Road, Suite 202, Lincoln, MA 01772 |
| Subadvisers | Columbia Partners, L.L.C., Investment Management, 5425 Wisconsin Avenue, Suite 700, Chevy Chase, MD 20815 PanAgora Asset Management, Inc., 121 High Street, 2nd Floor, Boston, MA 02110 Polaris Capital Management, LLC, 125 Summer Street, Boston, MA 02210 |
| Distributor | U.S. Boston Capital Corporation, 55 Old Bedford Road, Suite 202, Lincoln, MA 01773 |
| Custodian | State Street Bank and Trust Company, One Lincoln Street, Boston, MA 02111 |
| Fund Accountant | State Street Bank and Trust Company, One Lincoln Street, Boston, MA 02111 |
| Transfer Agent | Pear Tree Institutional Services, 55 Old Bedford Road, Suite 202, Lincoln, MA 01773 |
Independent Registered Public Accounting Firm | Tait, Weller & Baker LLP, 1818 Market Street, Suite 2400 Philadelphia, PA 19103 |
| Legal Counsel | Nutter, McClennen & Fish, Seaport West, 155 Seaport Boulevard, Boston, MA 02210 |
| For Account Information | For Pear Tree Funds information, contact your financial adviser or, if you receive account statements directly from Pear Tree Funds, you can also call 1-800-326-2151. Telephone representatives are available from 8:30 a.m. to 4:30 p.m. Eastern Time. Or visit our website, www.peartreefunds.com |
ITEM 2. Code of Ethics
| (a) | As of the end of the period covered by this Form N-CSR, Pear Tree Funds has adopted a code of ethics (as defined in Item 2(b) of Form N-CSR) that applies to the registrant’s principal executive officer, principal financial officer and principal accounting officer and controller. |
| (c) | There have been no amendments to the Pear Tree Fund’s Code of Ethics during the period covered by this report. |
| (d) | There have been no waivers to the Pear Tree Fund’s Code of Ethics during the period covered by this report. |
(e) Not applicable.
(f)(1) One copy of the Code of Ethics is being filed under Item 12(a) hereto.
ITEM 3. Audit Committee Financial Expert
Pear Tree Fund’s Board of Trustees has determined that Mr. Clinton S. Marshall is an “audit committee financial expert” as defined in Item 3 of Form N-CSR. Mr. Marshall is “independent” under the standards set forth in Item 3 of Form N-CSR.
ITEM 4. Principal Accountant Fees and Services
The following chart shows the aggregate fees billed in each of the last two fiscal years for services rendered by the registrant’s principal accountant, Tait, Weller and Baker, LLP (“Tait Weller”). The registrant’s Audit Committee approved the selection of Tait Weller as independent registered public accounting firm on September 14, 2007.
| 2013 | 2014 | ||
| Audit Fees* | Tait Weller | $119,000 | $133,000 |
| Audit-Related Fees** | Tait Weller | $38,000 | $38,000 |
| Tax Fees*** | Tait Weller | $19,000 | $19,000 |
| All Other Fees | Tait Weller | $0 | $0 |
* Audit fees include all services related to the audit of the financial statements, including review of the registration statement and the issuance of related consents.
** These amounts represent fees paid for the annual audit of the registrant’s transfer agent, Pear Tree Institutional Services, a division of Pear Tree Advisors, Inc., the registrant’s investment advisor.
*** Tax fees include review of the registrant’s tax filings.
| (e)(1) | To the extent required by applicable law, pre-approval by the Audit Committee of the Board is needed for: |
(i) all audit and permissible non-audit services rendered to the Pear Tree Funds and
(ii) all permissible non-audit services rendered to Pear Tree Advisors, Inc. if the services relate directly to the operations and financial reporting of the Registrant. Pre-approval is currently on an engagement-by-engagement basis. In the event pre-approval of such services is necessary between regular meetings of the Audit Committee and it is not practical to wait to seek pre-approval at the next regular meeting of the Audit Committee, such pre-approval of services may be referred to the President of the Fund for approval; provided that the President may not pre-approve any individual engagement for such services exceeding $5,000 or multiple engagements for such services in the aggregate exceeding $5,000 between such regular meetings of the Audit Committee. Any engagement pre-approved by the President between regular meetings of the Audit Committee shall be presented for ratification by the entire Audit Committee at its next regularly scheduled meeting.
| (e)(2) | No services in the past two fiscal years were approved by the Audit Committee pursuant to Rule 2-01(c)(7)(i)(C) of Regulation S-X. |
(f) Not applicable.
| (g) | The following chart shows the aggregate non-audit fees billed by Tait Weller for services rendered to the registrant and the registrant’s investment advisor (not including any subadviser 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. |
| 2013 | 2014 | ||
| Non-Audit Fees | Tait Weller | $0 | $0 |
| (h) | The Audit Committee of the registrant’s Board of Trustees considered the provision of non-audit services that were rendered to the registrant’s investment adviser (not including any subadviser 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 investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X and concluded that such services are compatible with maintaining the principal accountant’s independence. |
ITEM 5. Audit Committee of Listed Registrants
Not applicable.
ITEM 6. Investments
| (a) | Included as part of report to shareholders under Item 1. |
| (b) | Not applicable. |
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 President and Treasurer of the registrant have concluded, based on their evaluation of the effectiveness of the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Act) as of a date within 90 days of the filing date of this report on Form N-CSR, that the design and operation of such procedures provide reasonable assurance that information required to be disclosed by the registrant in this report on Form N-CSR is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.
(b) There has been no change in the registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
ITEM 12. Exhibits
(a)(1) Code of ethics
(a)(2) Certifications pursuant to Rule 30a-2(a) by the chief executive and financial officers.
(a)(3) Not applicable.
| (c) | Certification pursuant to Rule 30a-2(b) and Section 906 by the chief executive and financial officers. |
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.
Pear Tree Funds
By: /s/ Willard L. Umphrey
Willard L. Umphrey, President
Date: May 30, 2014
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/ Willard L. Umphrey
Willard L. Umphrey, President
Date: May 30, 2014
By: /s/ Leon Okurowski
Leon Okurowski, Treasurer
Date: May 30, 2014