UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORMN-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number:811-04920
WASATCH FUNDS TRUST
(Exact name of registrant as specified in charter)
505 Wakara Way, 3rd Floor
Salt Lake City, UT 84108
(Address of principal executive offices)(Zip code)
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| (Name and Address of Agent for Service) | | Copy to: |
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Eric S. Bergeson Wasatch Advisors, Inc. 505 Wakara Way, 3rd Floor Salt Lake City, UT 84108 | | Eric F. Fess, Esq. Chapman & Cutler LLP 111 West Monroe Street Chicago, IL 60603 |
Registrant’s telephone number, including area code: (801)533-0777
Date of fiscal year end: September 30
Date of reporting period: March 31, 2019
Item 1. Report to Shareholders.
2019 SEMI-ANNUAL REPORT AND QUARTERLY COMMENTARIES March 31, 2019 FUND NAME Investor Class Institutional Class Wasatch Core Growth Fund WGROX WIGRX Wasatch Emerging India Fund WAINX WIINX Wasatch Emerging Markets Select Fund WAESX WIESX Wasatch Emerging Markets Small Cap Fund WAEMX WIEMX Wasatch Frontier Emerging Small Countries Fund WAFMX WIFMX Wasatch Global Opportunities Fund WAGOX WIGOX Wasatch Global Value Fund FMIEX WILCX Wasatch International Growth Fund WAIGX WIIGX Wasatch International Opportunities Fund WAIOX WIIOX Wasatch Micro Cap Fund WMICX — Wasatch Micro Cap Value Fund WAMVX — Wasatch Small Cap Growth Fund WAAEX WIAEX Wasatch Small Cap Value Fund WMCVX WICVX Wasatch Ultra Growth Fund WAMCX —Wasatch-Hoisington U.S. Treasury Fund WHOSX - Beginning January 31, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Wasatch Funds’ shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Funds or from your financial intermediary, (such as a broker-dealer or bank). Instead, the reports will be made available on the Wasatch Funds website, and you will be notified by mail each time a report is posted and provided with a website link to access the report. If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from Wasatch Funds electronically by contacting your financial intermediary (such as a broker-dealer or bank) or, for Fund shares held directly with Wasatch Funds, by calling 800.551.1700 or by enrolling in “eDelivery” by logging into your account at https://wasatchfunds.olaccess.com. You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue receiving paper copies of your shareholder reports. If you invest directly with Wasatch Funds, you can call 800.551.1700 to let us know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all Wasatch Funds held in your account if you invest through a financial intermediary or all Wasatch Funds held with the fund complex if you invest directly with Wasatch Funds.
WASATCH FUNDS
Salt Lake City, Utah
www.WasatchFunds.com
800.551.1700
This material must be accompanied or preceded by a prospectus.
Please read the prospectus carefully before you invest.
Wasatch Funds are distributed by ALPS Distributors, Inc.
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| LETTERTO SHAREHOLDERS — GREAT COMPANIES FIND WAYSTO WIN OVERTHE LONG TERM | | |
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Ken Applegate, CFA, CMT Portfolio Manager | | 
Linda Lasater, CFA Portfolio Manager | | DEAR FELLOW SHAREHOLDERS: For this latest letter, we focus on a long-held Wasatch investment philosophy: Genuinely great companies are — as Warren Buffett has said — “rare gems” that prevail regardless of political climates, economic conditions or market events. This view is supported by an extensive quantitative study of corporate growth and survivorship undertaken by Patrick Viguerie and Sven Smit, researchers with consulting giant McKinsey & Company. In 2008, Viguerie and Smit, along with former McKinsey colleague Mehrdad Baghai, published their work in the Wiley business bestseller,The Granularity of Growth. In 2015, Smit revisited the book’s central thesis with another McKinsey colleague, Yuval Atsmon, to determine if the book’s findings still held true. Smit and Atsmon built abrand-new proprietary database to track company fundamentals across S&P 500 Index constituents over the30-year period from 1983 to 2013. The duo published their |
findings in a McKinsey research report entitledWhy It’s Still a World of ‘Grow or Go.’ The report found:
| | • | | For the three-decade period, nearly 60% of the S&P 500 companies that lagged their peers — in terms of growth and profit margins — were acquired. |
| | • | | More than 75% of the S&P 500 constituents that generatedtop-line growth and maintained or improved margins outperformed the Index over the period. |
| | • | | 56% of the companies that grew slowly but also aggressively distributed cash to shareholders outperformed the Index. |
| | • | | Companies with deteriorating margins underperformed, even if these companies were still growing at a significant clip. |
After revisiting the core tenets ofThe Granularity of Growth, Smit and Atsmon concluded that “outperforming the competition remains possible in all industries, even in sluggish economic times.” They added that high-performing companies “continually seek the kind of growth that generates real and sustainable value.”
Consistent with the principles described by the McKinsey researchers, we’d like to emphasize the following points:
| | • | | We’re repeatedly faced with challenges — the first quarter of 2019 presented its share, including the longest federal government shutdown in U.S. history, the continuation of the U.S.-China trade tensions and the U.K.’s wrangling over how to exit from the European Union. |
| | • | | Financial markets rebounded from sharp fourth-quarter declines. Despite the recent strong stock-market performance, we believe global economic growth is slowing. |
| | • | | While we’re on the lookout for potential challenges, having a large universe to pick from means we can always findhigh-quality, long-duration growth companies around the world and across market capitalizations. |
ECONOMY
In terms of economic news, we begin with the United States, the world’s largest economy. Real gross domestic product (GDP) in 2018’s fourth quarter rose at an annual rate of 2.2%, down from an earlier estimate of 2.6%. The retail-sales report from the U.S. Department of Commerce downwardly revised December’s percentage decline from-1.2% to-1.6%, further accentuating the worst month for retail sales since the global financial crisis. However, better news followed when it was reported that U.S. retail sales for January 2019 posted a significant 2.3% year-over-year increase. The U.S. Consumer Price Index also edged up recently, but a temporary drop in energy prices helped to hold down the Index on a year-over-year basis. With core inflation running at about a 2.1% annualized pace, the underlying trend remains in line with the Federal Reserve’s target of 2.0%.
Regarding China, the world’s second-largest economy, early data indicate continued deceleration in 2019. Nevertheless, China’s February retail sales rose more than 8% year-over-year, which was in line with forecasts. What’s more important to us, however, is that the selection of high-quality Chinese companies has doubled in the past three years. We continue to devote significanton-the-ground due diligence aimed at identifying emerging leaders in various industries. This research includes theA-share market of approximately 1,400 companies incorporated in mainland China.
We turn now to Japan, the world’s third-largest economy and home to what we believe is one of the most excitingsmall-cap markets globally. Despite being supported by easy monetary policy, many economic indicators such as GDP growth are uninspiring. However, there are positive factors — such as Japan’s multi-decade low unemployment rate. With the country facing a labor shortage, we’re seeing some wage inflation, which can act as a tailwind for Japan’s domestic consumers. The tight labor market is also creating opportunities for companies that enable businesses to become more efficient and productive.
Continuing this review of developed nations, we land next on the United Kingdom, which remains in upheaval over Brexit. In April, Prime Minister Theresa May secured an extension from the European Council, which gives her until October 31st to work out a compromise deal with the fractious British Parliament. The uncertainty of Brexit has been clouding the British economy and markets since the referendum in 2016, and this haze is likely to persist until we know the outcome.
Among emerging markets, we see attractive company valuations coupled with bureaucratic reforms and stimulative government initiatives. In addition, investor sentiment has improved due to low inflation and reduced concerns over monetary policies in developed nations. These factors have also enhanced the prospects for emerging-market currency valuations. Moreover, country balance sheets have strengthened, as have international fund flows into emerging markets.
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| | MARCH 31, 2019 (UNAUDITED) |
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Beyond China, we believe Latin America may offer good investment opportunities. The region’s political situation (although still highly imperfect) has become somewhat more stable, and the economic recovery seems to be getting back on track. In Brazil, we saw signs of improving consumer sentiment, and we think the country will make progress regarding deficit reduction and reining in corruption.
As for India,pro-business priorities and structural government-policy changes implemented over the past several years should pay economic dividends beyond the next decade. The government’s efforts — along with attractive demographics and a still rapidly growing economy — help make the country one of our most-fertile grounds for finding promising emerging-market investments.
MARKETS
We recently heard a great adage about investing: “The stock market is the only market where people head for the exit when things go on sale.” And considering what followed 2018’s stock-market rout, heading for the exit certainly wasn’t a wise move. As long-term investors, we prefer to use overall market weakness as an opportunity to increase our positions in exceptional businesses.
During the first quarter of 2019, the U.S.large-cap S&P 500® Index advanced 13.65%. The technology-heavy Nasdaq Composite Index gained 16.81%. The Russell 2000® Index of small caps rose 14.58%. And growth-oriented small caps performed extremely well, with the Russell 2000 Growth Index up 17.14%. Value-oriented small caps in the Russell 2000 Value Index were up 11.93%, as value stocks — including those across larger market capitalizations — generally trailed growth stocks. The outperformance of growth stocks relative to value names was a continuation of a trend we’ve seen for a number of years.
For the most part, international stocks also performed very well but generally lagged those in the U.S. The MSCI World ex USA Index rose 10.45% and the MSCI Emerging Markets Index gained 9.92% for the first quarter.
Intermediate- and long-term bond yields fell during the quarter as the inversion of the yield curve signaled subdued inflationary expectations. Because bond prices move in the opposite direction of yields, bond indexes posted positive returns. The Bloomberg Barclays US Aggregate Bond Index increased 2.94%. And the Bloomberg Barclays US 20+ Year Treasury Bond Index was up a solid 4.73%.
WASATCH
At Wasatch, we think the returns for stocks and bonds during the first quarter of 2019 were reminders of the difficulty of using macro events to try to predict asset prices. It appeared to us that the first-quarter rebound was triggered by investors feeling relieved by the pause in tightening of U.S. monetary policy and the outright accommodative monetary policies in Europe and Asia.
Stock investors seemed to ignore the inverted yield curve and the signs of slowing economic growth around the world. For our part, we believe it’s important to note that economic slowdowns and recessions aren’t all bad, as they can help correct excesses that build up during economic expansions. This underscores the importance of owning high-quality companies that are able to maneuver through challenging times. Truly exceptional companies focus on the long term — which provides the potential for investors like us to benefit from the power of compounding returns.
As we’ve said, forecasting macro events and how those events might affect stock prices over the short term isn’t our game. But we do recognize that macro events will sometimes create a tailwind for us, while at other times the wind will be in our faces. Through it all, we remain steadfastly focused on the long-term potential of individual stocks. In 2018, our investment team visited companies in 23 countries. Over the past two years, we’ve had over 1,500face-to-face meetings with management teams and made over 800on-site company visits. We believe that interactions with such a broad array of companies, combined with ourbottom-up quantitative screens, provide an even more robust view of business conditions and competitive dynamics.
With sincere thanks for your continuing investment and for your trust,
Ken Applegate and Linda Lasater
Information in this report regarding market or economic trends, or the factors influencing historical or future performance, reflects the opinions of management as of the date of this report. These statements should not be relied upon for any other purpose. Past performance is no guarantee of future results, and there is no guarantee that the market forecasts discussed will be realized.
CFA® is a trademark owned by CFA Institute.
Wasatch Advisors is the investment advisor to Wasatch Funds.
Wasatch Funds are distributed by ALPS Distributors, Inc. (ADI). ADI is not affiliated with Wasatch Advisors, Inc.
Definitions of financial terms and index descriptions and disclosures begin on page 34.
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| WASATCH CORE GROWTH FUND(WGROX / WIGRX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Core Growth Fund is managed by a team of Wasatch portfolio managers led by JB Taylor, Paul Lambert and Mike Valentine.
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JB Taylor Lead Portfolio Manager | | 
Paul Lambert Portfolio Manager | | 
Mike Valentine Portfolio Manager |
OVERVIEW
Stocks roared back in the first quarter of 2019. The Wasatch Core Growth Fund — Investor Class delivered a strong gain of 15.37% for the quarter, outperforming the 14.58% return of its primary benchmark, the Russell 2000 Index. The Fund slightly underperformed the Russell 2000 Growth Index, which rose 17.14%.
The past several quarters delivered a host of geopolitical, economic and technical market events — including the U.S. government shutdown, wrangling over Britain’s exit from the European Union and concerns of a “hard landing” for China’s economy. Two other highly publicized macro issues also stood out to us:
1. The wildup-and-down swings in stock prices over the past 15 months underscored, in our view, what may be a sustained increase in market volatility.
2. In late March 2019, the yield curve inverted for the first time since 2007, primarily due to the release of softer U.S. economic data, accommodative signals provided by Federal Reserve officials and bond investors believing interest-rate increases are over. Of course, many market pundits have opined that every American recession over the past 60 years has been preceded by an inverted yield curve. These same pundits have usually failed to mention, however, that a yield-curve inversion doesn’t predict the exact timing of a recession or how stocks will perform.
We raise these two macro issues — the significant increase in market volatility and the yield-curve inversion — not because our investment decisions rely heavily on macro conditions. Rather, we raise these issues because we think investors may have to get used to greater volatility in stock prices and because we want shareholders to be mindful that economic and market predictions aren’t as accurate as the headlines would have us believe.
DETAILSOFTHE QUARTER
The top contributor to performance for the first quarter was Euronet Worldwide, Inc., an electronic-payments business that operates ATMs, traditionalpoint-of-sale (POS) terminals, prepaid POS terminals and money-transfer networks. The company reported significant increases in operating income and adjusted earnings per share. As is often the
case with stronger-than-expected numbers, Euronet’s stock price soared after the report. We continue to be impressed with the company’s operating discipline — as 2018 was the sixth consecutive year that management delivered double-digit growth in adjusted earnings per share.
Another significant contributor was auto-repair chain Monro, Inc. The company started to see a turnaround in 2017 — after which we visited with Brett Ponton, Monro’s newly installed CEO. During this visit, we were encouraged by the company’s long-term growth prospects, along with Mr. Ponton’s strategic direction. In January 2019, Monro reported record revenue and a significant increase in net income. We remain pleased with Monro’s management team and believe the stock price has started to reflect the company’s progress.
The largest detractor from Fund performance was Metro Bank plc, one of theso-called “challenger banks” established in the U.K. after the global financial crisis. Despite Metro’s rapid growth, the stock plunged in January after the bank disclosed that it had applied an incorrectly low risk weighting to parts of its loan book. The stock fell again in February on news that Metro will have to raise additional equity in order to put more capital behind the misclassified loans. The bank now faces the prospect of having to issue stock at prices that are highly dilutive to the ownership stakes of existing shareholders.
Another major detractor was Cimpress N.V., a “mass-market customization” provider of printing, signage and packaging services. In January, the company reported a second consecutive quarter of disappointing earnings. Cimpress grew consolidated revenue just 8% compared to 32% for theyear-ago quarter, which disappointed Wall Street. We plan to monitor Cimpress closely to see if the steep decline in consolidated revenue was aone-time aberration or a more-meaningful trend.
OUTLOOK
As we’ve sifted through a multitude of sales and earnings reports over the past few months, we’ve tried to determine whether or not our long-term holdings remain on track. For the most part, we’ve been very pleased with our companies’ progress — which has led to remarkably little turnover in the Fund.
Going forward, we expect the relatively low turnover to continue. We think about it this way: U.S.small-cap stocks are roughly trading atyear-ago levels, but there’s been quite a lot of volatility along the way. Meanwhile, our companies have grown their sales and earnings at double-digit rates overall. We think our companies may have improved their competitive positions in the past year because great businesses tend to strengthen during times of slower economic growth, while lesser businesses tend to weaken.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
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| WASATCH CORE GROWTH FUND(WGROX / WIGRX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
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| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
Core Growth (WGROX) — Investor | | | | -6.18% | | | | | 6.83% | | | | | 11.25% | | | | | 18.45% | |
Core Growth (WIGRX) — Institutional | | | | -6.11% | | | | | 6.97% | | | | | 11.38% | | | | | 18.54% | |
Russell 2000® Index | | | | -8.56% | | | | | 2.05% | | | | | 7.05% | | | | | 15.36% | |
Russell 2000® Growth Index | | | | -8.22% | | | | | 3.85% | | | | | 8.41% | | | | | 16.52% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Core Growth Fund are Investor Class: 1.18% / Institutional Class — Gross: 1.08%, Net: 1.06%. The expense ratio shown elsewhere in this report may be different. Net expenses are based on Fund expenses, net of waivers and reimbursements. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Performance for the Institutional Class prior to 1/31/2012 is based on the performance of the Investor Class. Performance of the Fund’s Institutional Class prior to 1/31/2012 uses the actual expenses of the Fund’s Investor Class without any adjustments. For any such period of time, the performance of the Fund’s Institutional Class would have been substantially similar to, yet higher than, the performance of the Fund’s Investor Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses.
Investing in small cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds. Investing in foreign securities, especially in emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus.
TOP 10 EQUITY HOLDINGS**
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| Company | | % of Net
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| Euronet Worldwide, Inc. | | | 4.2% | |
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| Monro, Inc. | | | 3.4% | |
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| Pool Corp. | | | 3.2% | |
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| Copart, Inc. | | | 2.9% | |
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| ICON plc(Ireland) | | | 2.8% | |
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| Company | | % of Net
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| Balchem Corp. | | | 2.8% | |
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| Trex Co., Inc. | | | 2.8% | |
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| Guidewire Software, Inc. | | | 2.7% | |
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| EPAM Systems, Inc. | | | 2.7% | |
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| Tyler Technologies, Inc. | | | 2.6% | |
| ** | As of March 31, 2019, there were 53 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| †† | Also includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheRussell 2000 Index is an unmanaged total return index of the smallest 2,000 companies in the Russell 3000 Index, as ranked by total market capitalization. The Russell 2000 Index is widely regarded in the industry as accurately capturing the universe of small company stocks. TheRussell 2000 Growth Index is an unmanaged total return index that measures the performance of those Russell 2000 Index companies with higher price-to-book ratios and higher forecasted growth values.You cannot invest directly in these or any indexes.
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| WASATCH EMERGING INDIA FUND(WAINX / WIINX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Emerging India Fund is managed by a team of Wasatch portfolio managers led by Ajay Krishnan and Matthew Dreith.
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Ajay Krishnan, CFA Lead Portfolio Manager | | 
Matthew Dreith, CFA Portfolio Manager | | OVERVIEW Indian equities registered solid gains during the first quarter of the year, with the benchmark MSCI India Investable Market Index (IMI) rising 6.65%. Trailing the benchmark |
somewhat, the Wasatch Emerging India Fund — Investor Class returned 5.32%.
Apprehension surrounding India’s upcoming general election helped keep stock-market gains in check during January and February. Investors feared populist measures designed to enhance the ruling coalition’s approval with voters might strain India’s finances. Rising oil prices also raised concerns in a country that imports about 80% of the oil it uses. Sentiment improved in March after war was averted in the conflict with Pakistan along India’s northern border.
Energy stocks led India’s equity market higher as the price of Brent crude surged 25% during the first three months of the year. Energy was thetop-performing sector of the Index, and the Fund’s lack of investments in energy stocks was the primary reason the Fund lagged its benchmark. Information-technology (IT) stocks also were strong performers, as the IT component of the Index posted a double-digit percentage gain during the quarter. As with energy, however, the Fund’s significantly underweight position in IT hurt performance relative to the Index.
Consumer discretionary was one of the poorest-performing sectors after a lackluster festival season in 2018 fanned concerns that India’s economy may be slowing. Although the Fund’s consumer-discretionary stocks outperformed their benchmark peers, our overweight position in the sector offset that advantage. Health care and communication services were the Fund’s greatest sources of strength against the benchmark. In both of these sectors, our stocks appreciably surpassed their counterparts in the Index and helped Fund performance.
DETAILSOFTHE QUARTER
Financials accounted for a number of the Fund’s best performers. These included the two top contributors for the quarter, ICICI Lombard General Insurance Co. Ltd. and Bajaj Finance Ltd. ICICI Lombard is one of the largest private-sector general insurers in India. The company offers motor-vehicle, health, home, travel and other types of insurance coverage. An upswing in India’s insurance cycle continued to benefit ICICI Lombard and other insurance companies.
Anon-bank financial company, Bajaj Finance is the lending arm of the Bajaj Group — a well-regarded Indian industrial house founded in 1926. The company is experiencing secular
demand growth driven by increased financialization, favorable demographics and a cultural shift away from extended-family living arrangements. We believe the company is creating significant headroom for future growth through its innovative use of technology to expand the markets it serves.
The greatest detractor from Fund performance for the quarter was Godrej Consumer Products Ltd. Operating in India and internationally, Godrej is one of the leading manufacturers of household insecticides in India. As consumers seek new forms of protection from mosquito-borne diseases, illegally manufactured mosquito-repellent incense sticks have captured a growing share of India’s household-insecticide market. Now that Godrej has launched its own mosquito-repellent incense stick under the flagship Goodknight brand, we expect the competitive situation to improve.
Other weak stocks in the Fund included GRUH Finance Ltd. and Bandhan Bank Ltd. GRUH provides a range of home loans and insurance products through a network of offices in India. Bandhan is a commercial bank offering traditional and internet-banking services. Investors reacted negatively to news that Bandhan was acquiring GRUH in a stock-swap deal. The stock prices of both companies fell on the news, as the shareholders of both firms were unhappy with the details of the transaction. We liquidated the Fund’s positions in both companies to seek better opportunities elsewhere.
OUTLOOK
According to official government data released in February, India’s year-over-year gross domestic product growth slowed to 6.6% during the fourth quarter of last year — down from a revised 7% in the previous quarter and the weakest reading in six quarters. For a variety of reasons, we don’t view this report as a significant cause for concern.
First, our investment approach isn’t driven by economic forecasts. Although we take macroeconomic factors into account, most of our analysis focuses on the growth prospects of individual companies. And recent financial results from the companies we own in the Fund have generally been positive, with strongtop-line growth in a number of our consumer-related businesses.
Second, part of the recent slowdown resulted from sluggish sales of passenger cars andtwo-wheeled vehicles. Much of this can be attributed to higher financing costs and a shortage of loans during the fourth quarter as India’s shadow-banking system recovered from the default of a major player. But the tighter liquidity conditions are helping the Fund’snon-bank financial companies gain market share as weaker competitors struggle to obtain capital.
Third, a benign inflationary environment has allowed India’s central bank to take a more-accommodative stance with respect to monetary policy. The Reserve Bank of India (RBI) cut interest rates in February to spur economic growth, and new RBI Governor Shaktikanta Das has signaled the possibility of future cuts.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
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| WASATCH EMERGING INDIA FUND(WAINX / WIINX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
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| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | SINCE INCEPTION
4/26/11 |
Emerging India (WAINX) — Investor | | | | 12.62% | | | | | 4.43% | | | | | 16.59% | | | | | 11.49% | |
Emerging India (WIINX) — Institutional | | | | 12.81% | | | | | 4.64% | | | | | 16.74% | | | | | 11.58% | |
MSCI India IMI | | | | 10.06% | | | | | 2.98% | | | | | 8.59% | | | | | 3.07% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Emerging India Fund are Investor Class: 1.70% / Institutional Class — Gross: 1.60%, Net: 1.51%. The expense ratio shown elsewhere in this report may be different. Net expenses are based on Fund expenses, net of waivers and reimbursements. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Performance for the Institutional Class prior to 2/1/2016 is based on the performance of the Investor Class. Performance of the Fund’s Institutional Class prior to 2/1/2016 uses the actual expenses of the Fund’s Investor Class without any adjustments. For any such period of time, the performance of the Fund’s Institutional Class would have been substantially similar to, yet higher than, the performance of the Fund’s Investor Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses.
Investing in small cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds. Investing in foreign securities, especially in emerging markets, entails special risks, such as unstable currencies, highly volatile securities markets and political and social instability, which are described in more detail in the prospectus.
TOP 10 EQUITY HOLDINGS**
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| Company | | % of Net
Assets | |
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| Bajaj Finance Ltd.(India) | | | 7.8% | |
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| ICICI Lombard General Insurance Co. Ltd. (India) | | | 6.1% | |
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| V-Mart Retail Ltd.(India) | | | 5.6% | |
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| HDFC Bank Ltd.(India) | | | 5.2% | |
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| Housing Development Finance Corp. Ltd. (India) | | | 4.9% | |
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| Company | | % of Net
Assets | |
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| Divi’s Laboratories Ltd.(India) | | | 4.6% | |
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| Pidilite Industries Ltd.(India) | | | 4.4% | |
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| Dr. Lal PathLabs Ltd.(India) | | | 4.2% | |
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| Amara Raja Batteries Ltd.(India) | | | 4.1% | |
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| AU Small Finance Bank Ltd.(India) | | | 3.6% | |
| ** | As of March 31, 2019, there were 35 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees.‡Inception: April 26, 2011.The MSCI India IMI (Investable Market Index)is designed to measure the performance of the large-, mid- and small-cap segments of the Indian market. The Index covers approximately 99% of the free-float adjusted market capitalization of the Indian equity universe.You cannot invest directly in this or any index.
7
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| WASATCH EMERGING MARKETS SELECT FUND(WAESX / WIESX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Emerging Markets Select Fund is managed by a team of Wasatch portfolio managers led by Ajay Krishnan, Roger Edgley, Scott Thomas and Matthew Dreith.
| | | | |
Ajay Krishnan, CFA Lead Portfolio Manager 
Scott Thomas, CFA Associate Portfolio
Manager | | 
Roger Edgley, CFA Portfolio Manager
Matthew Dreith, CFA Associate Portfolio Manager | | OVERVIEW Emerging-market equities got off to a strong start in 2019, helped by a dovish shift in U.S. monetary policy and the prospect of additional economic stimulus in China. The benchmark MSCI Emerging Markets Index rose 9.92% during first quarter of the year. Outpacing the benchmark, the Wasatch Emerging Markets Select Fund — Investor Class gained 13.20%. After signaling a “patient” approach to raising interest rates in January, the U.S. Federal |
Reserve (Fed) pleased investors again in March by projecting no further rate hikes this year. The central bank also downgraded its outlook for U.S. economic growth and said it would stop shrinking its balance sheet in September. Taken together, the Fed’s moves undercut the U.S. dollar, making riskier investments in emerging markets more attractive to investors.
Strong gains in China and Brazil were the main reasons the Fund surpassed its benchmark. The Chinese government vowed to continue supporting the nation’s economy by cutting taxes and fees. In Brazil, new president Jair Bolsonaro faces the difficult tasks of reforming Brazil’s ailing pension system and reviving the economy, but we believe the companies we own there represent enduring, high-quality businesses with attractive prospects for long-term growth.
The Fund’s overweight position in India hurt performance, as apprehension ahead of upcoming elections kept Indian equities in check. A 25% increase in the U.S.-dollar price of Brent crude during the quarter also impacted sentiment toward India, which imports about 80% of the oil it uses.
DETAILSOFTHE QUARTER
Chinese stocks were some of the strongest contributors to Fund performance. Among these was Ctrip.com International Ltd., which soared after the online travel agent reported better-than-expected earnings and revenues in its most-recent quarter. Management cited the company’s customer-centric initiatives and platform improvements, as well as Ctrip’s expansion into lower-tier cities through localized product and
service offerings. Longer term, the company stands to benefit from rising urbanization rates and the transformation of China’s economy from manufacturing and investment to service and consumption.
MercadoLibre, Inc. was another large contributor. The company operatese-commerce platforms in Brazil and other Latin American countries. MercadoLibre’s payment solution, MercadoPago, is driving strong growth at the company as an increasing number ofe-commerce sites andbrick-and-mortar retailers adopt MercadoPago as a preferred payment method.
The greatest detractor from Fund performance for the quarter was Godrej Consumer Products Ltd. Operating in India and internationally, Godrej is one of India’s leading manufacturers of household insecticides. As Indian consumers seek new forms of protection from mosquito-borne diseases, illegally manufactured mosquito-repellent incense sticks have captured a significant share of the household-insecticide market. Now that Godrej has launched its own mosquito-repellent incense stick under the flagship Goodknight brand, we expect the competitive situation to improve as informal players exit the market.
Second-largest detractor Discovery Ltd. provides insurance products and services in South Africa and other countries. Higher-than-expected mortality experience impacted Discovery’s life-insurance business in the company’s most-recent quarter. Increased spending in Discovery’s new businesses, which include a bank in South Africa and a health-insurance venture in China, also hampered profitability. Given the expected growth in these new areas, however, we think the investments make sense.
OUTLOOK
Part of the reason for the Fund’s recent outperformance is the type of companies we own. Of particular interest to us are stable businesses tied to secular growth in domestic demand from an expanding middle class. We’re less interested in exporters and commodity producers, which are often subject to the whims of the global economy. During the first quarter, heightened concerns about the pace of global growth boosted the appeal of our high-quality, long-duration businesses.
Given recent structural reforms in India, we’re comfortable carrying an above-benchmark weighting in Indian stocks. Although the uncertainty surrounding India’s upcoming general election kept a lid on stock prices for most of the quarter, March was a month of strong gains for Indian equities.
In China, we continue to devote significant research attention to theA-share market, which consists of the stocks of approximately 1,400 companies incorporated in mainland China. Quoted in Chinese renminbi,A-shares are traded on China’s Shanghai or Shenzhen stock exchanges. Identifying long-duration growth opportunities of the type we favor has proven particularly difficult in China. The task is complicated by the need to invest in Chinese companies whose businesses align with the goals of the Chinese government.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
8
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| WASATCH EMERGING MARKETS SELECT FUND (WAESX / WIESX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | SINCE INCEPTION 12/13/12 |
Emerging Markets Select (WAESX) — Investor | | | | 6.35% | | | | | -1.60% | | | | | 2.41% | | | | | 1.68% | |
Emerging Markets Select (WIESX) — Institutional | | | | 6.53% | | | | | -1.32% | | | | | 2.67% | | | | | 2.00% | |
MSCI Emerging Markets Index | | | | 1.71% | | | | | -7.41% | | | | | 3.68% | | | | | 2.64% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Emerging Markets Select Fund are Investor Class — Gross: 1.76%, Net: 1.51% / Institutional Class — Gross:1.45%, Net: 1.21%. The expense ratio shown elsewhere in this report may be different. Net expenses are based on Fund expenses, net of waivers and reimbursements. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Investing in foreign securities, especially in emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus. Investing in small cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds.
TOP 10 EQUITY HOLDINGS**
| | | | |
| Company | | % of Net
Assets | |
| |
| Bajaj Finance Ltd.(India) | | | 7.7% | |
| |
| Alibaba Group Holding Ltd. ADR(China) | | | 5.0% | |
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| Ctrip.com International Ltd. ADR(China) | | | 4.3% | |
| |
| Tencent Holdings Ltd.(China) | | | 4.2% | |
| |
| BGF Retail Co. Ltd.(Korea) | | | 4.1% | |
| | | | |
| Company | | % of Net
Assets | |
| |
| HDFC Bank Ltd.(India) | | | 4.0% | |
| |
| Vitasoy International Holdings Ltd.(China) | | | 4.0% | |
| |
| Medytox, Inc.(Korea) | | | 3.8% | |
| |
| Raia Drogasil S.A.(Brazil) | | | 3.4% | |
| |
| ICICI Lombard General Insurance Co. Ltd. (India) | | | 3.3% | |
| ** | As of March 31, 2019, there were 35 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| †† | Also includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees.‡Inception: December 13, 2012. The MSCI Emerging Markets Index is a free float-adjusted market capitalization index designed to measure the equity market performance of emerging markets.You cannot invest directly in this or any index.
9
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| WASATCH EMERGING MARKETS SMALL CAP FUND (WAEMX / WIEMX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Emerging Markets Small Cap Fund is managed by a team of Wasatch portfolio managers led by Ajay Krishnan, Dan Chace, Roger Edgley, Andrey Kutuzov, Scott Thomas and Kevin Unger.
| | | | |
Ajay Krishnan, CFA Lead Portfolio Manager | | 
Dan Chace, CFA Portfolio Manager | |
Roger Edgley, CFA Portfolio Manager |
| | | | |
Andrey Kutuzov, CFA Associate Portfolio Manager | |
Scott Thomas, CFA Associate Portfolio Manager | | 
Kevin Unger, CFA Associate Portfolio Manager |
OVERVIEW
The Wasatch Emerging Markets Small Cap Fund — Investor Class gained 10.39% for the three months ended March 31, 2019 and outperformed the MSCI Emerging Markets Small Cap Index, which gained 7.76%.
A dovish shift in U.S. monetary policy and the prospect of additional economic stimulus in China helped emerging-market equities get off to a strong start in 2019. While we take macroeconomic factors into account, our primary focus is on analyzing the growth prospects of individual companies in emerging markets. We look for stable businesses benefiting from secular trends tied to a country’s long-term development. We believe the Fund’s holdings are high-quality businesses capable of long-duration growth.
DETAILSOFTHE QUARTER
For the quarter, the Fund’s holdings in India substantially outperformed their benchmark counterparts. India is the Fund’s largest country weighting, and the Fund is significantly overweight versus the Index. Info Edge India Ltd., a leader in online classified advertising, was a top contributor to Fund performance. We believe the company has substantial headroom for growth as the Indian market is in the early stages of shifting from print to online advertising. In other markets, we have seen dominant providers of online classified ads demonstrate consistent growth and they are extremely difficult for competitors to dislodge.
The Fund’s holdings in China significantly outperformed those in the benchmark for the quarter led by top overall contributor Vitasoy International Holdings Ltd. This Chinese company offers soy milk, tofu, rice milk, tea, juices and relatedfood-and-beverage products in over 40 countries. Vitasoy reported strong earnings citing improved manufacturing efficiency and favorable trends in commodity prices, particularly sugar and milk powder.
Taiwan was another large contributor to performance led by Win Semiconductors Corp. Win manufactures gallium arsenide (GaAs) wafers, the dominant semiconductor technology for mobile devices. Win is expected to benefit from the deployment of 5G user equipment and network infrastructure. Win also provides optoelectronic device fabrication services for optical communication and 3D sensing applications. Strong demand for 3D sensing has been increasing and diversifying the company’s growth profile.
The Fund’s largest detractor was Douzone Bizon Co. Ltd., the leading accounting software and enterprise-resource planning (ERP) provider in Korea. The company has been transitioning from desktop to cloud software products, which has led to a pickup in growth, margins and returns on capital. Douzone’s ERP business has been more volatile than expected and earnings were below expectations, but we expect the ERP segment to become more consistent over time.
Magazine Luiza S.A., the Fund’s top contributor for 2018, detracted for the first quarter of 2019. The company operates consumer-electronic stores in Brazil. Strong information-technology infrastructure drives itse-commerce business, and its stores act as showrooms and mini-distribution centers.
Muangthai Capital Public Co. Ltd., a provider of lending services in Thailand, was the third-largest detractor. Uncertainty around pending regulation ofnon-bank financial companies in Thailand and the effect it might have on current interest rates and fees has been substantially resolved.
OUTLOOK
Positive factors that could help emerging markets in 2019 include the U.S. Federal Reserve’s lowered projections for future interest-rate hikes, the potential for a trade deal between the U.S. and China, and the inexpensive prices of emerging-market stocks compared to those in developed markets. Moreover, many emerging-market currencies have stabilized against the U.S. dollar. Lower inflation is supportive of domestic consumers in emerging-market countries.
In India, we expect that when the upcoming national elections are complete, investors will be better able to focus on the strong business momentum and fundamentals that we see every day as we research individual Indian companies.
The emerging-market universe is becoming more diverse across sectors. We are seeing more knowledge-based companies and companies with valuable intellectual property. These and other positive factors support the future of emerging-market equity investing and the long-term growth of companies in these markets.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
10
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| WASATCH EMERGING MARKETS SMALL CAP FUND (WAEMX / WIEMX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
Emerging Markets Small Cap (WAEMX) — Investor | | | | 3.63% | | | | | -10.81% | | | | | 2.34% | | | | | 13.77% | |
Emerging Markets Small Cap (WIEMX) — Institutional | | | | 4.01% | | | | | -10.43% | | | | | 2.49% | | | | | 13.85% | |
MSCI Emerging Markets Small Cap Index | | | | 0.03% | | | | | -12.42% | | | | | 1.76% | | | | | 10.37% | |
MSCI Emerging Markets Index | | | | 1.71% | | | | | -7.41% | | | | | 3.68% | | | | | 8.94% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Emerging Markets Small Cap Fund are Investor Class — Gross: 1.97%, Net: 1.95% /Institutional Class — Gross: 1.83%, Net: 1.81%. The expense ratio shown elsewhere in this report may be different. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Performance for the Institutional Class prior to 2/1/2016 is based on the performance of the Investor Class. Performance of the Fund’s Institutional Class prior to 2/1/2016 uses the actual expenses of the Fund’s Investor Class without any adjustments. For any such period of time, the performance of the Fund’s Institutional Class would have been substantially similar to, yet higher than, the performance of the Fund’s Investor Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses.
Investing in foreign securities, especially in emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus. Investing in small cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds.
TOP 10 EQUITY HOLDINGS**
| | | | |
| Company | | % of Net
Assets | |
| |
| Vitasoy International Holdings Ltd.(China) | | | 3.5% | |
| |
| ICICI Lombard General Insurance Co. Ltd. (India) | | | 3.3% | |
| |
| Medytox, Inc.(Korea) | | | 3.2% | |
| |
| ASPEED Technology, Inc.(Taiwan) | | | 3.2% | |
| |
| 51job, Inc. ADR(China) | | | 2.9% | |
| | | | |
| Company | | % of Net
Assets | |
| |
| Bajaj Finance Ltd.(India) | | | 2.8% | |
| |
| Magazine Luiza S.A.(Brazil) | | | 2.7% | |
| |
| Info Edge India Ltd.(India) | | | 2.7% | |
| |
| Silergy Corp.(Taiwan) | | | 2.5% | |
| |
| Globant S.A.(Argentina) | | | 2.3% | |
| ** | As of March 31, 2019, there were 61 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| †† | Also includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheMSCI Emerging Markets andEmerging Markets Small Cap indexes are free float-adjusted market capitalization indexes designed to measure the equity market performance of emerging markets.You cannot invest directly in these or any indexes.
11
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| WASATCH FRONTIER EMERGING SMALL COUNTRIES FUND (WAFMX / WIFMX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Frontier Emerging Small Countries Fund is managed by a team of Wasatch portfolio managers led by Scott Thomas and Jared Whatcott.
| | | | |
Scott Thomas, CFA Lead Portfolio Manager | | 
Jared Whatcott, CFA Portfolio Manager | | OVERVIEW The first quarter of 2019 saw global equity markets rebound from fourth-quarter weakness. In the frontier and emerging small countries universe, the MSCI Frontier Emerging Markets |
Index rose 9.44% and the Wasatch Frontier Emerging Small Countries Fund — Investor Class gained 9.66%.
The strength of the U.S. dollar, which has been a persistent headwind for frontier markets and many small emerging-market countries, continued to abate in the first quarter as the U.S. Federal Reserve signaled a “patient” approach to raising interest rates in January and again in March by projecting no further rate hikes this year. What’s more, perceived progress on U.S.-China trade negotiations, however slight, and a recovery in oil prices, after hitting recent lows in December 2018, helped to improve investors’ sentiment on the frontier asset class.
DETAILSOFTHE QUARTER
Egypt was the largest contributor to Fund performance for the first quarter. After a difficult period of adjustment and foreign currency liberalization in 2016, the country is now witnessing strong and ameliorating fundamentals such as improving external balances, healthy foreign exchange reserves, inflation normalization, and positive fiscal-reform initiatives. These factors along with high domestic bond yields have attracted asset inflows into the country’s equity and debt markets. Cleopatra Hospital, the largest private hospital operator in Egypt, was a top contributor for the Fund. Cleopatra is at the forefront of consolidating a fragmented and underdeveloped hospital market. With Egypt’s population of 100 million people, a significant undersupply of hospital beds, and one of the lowest levels of health-care spending per capita in the region, we believe demand for Cleopatra’s services is set to grow at a rapid pace.
Two Latin American companies — MercadoLibre, Inc. and Globant S.A. — were the top contributors to Fund performance for the quarter. MercadoLibre operatese-commerce platforms in Brazil and other Latin American countries. The company’s most-recent report highlighted continued strength in sales growth across key markets such as Brazil and Argentina.
Globant, an information-technology services company based in Argentina, has been witnessing strong demand for its digital services and benefits from a portfolio of high-quality, blue-chip customers. Globant’s recently reported results were strong with revenue and margin guidance better
than we had expected driven mostly by the company’s ability to meet the needs of media and financial customers.
Colombia was the top-performing country within the Index, increasing nearly 25% for the quarter. As a result, our underweight exposure to Colombia detracted significantly from performance relative to the benchmark. Colombia’s economic indicators were surprisingly good, making evident a gradual firming of economic growth. The Colombian peso appreciated 1.9% in nominal terms versus the U.S. dollar, aided by higher oil prices, the country’s key export.
Our only holding in Colombia, Banco Davivienda S.A., a universal bank, gained nearly 25% during the quarter. The company has been benefiting from accelerating loan growth and improving credit-quality trends. Mortgages, a key lending segment for the bank, increased 16% from the same period a year ago. Banco Davivienda’s digital customers reached 1.4 million, up 62% from the year-ago period.
The largest detractor from Fund performance for the quarter was Discovery Ltd., a South Africa-based insurance company. The company reported worse-than-expected semi-annual results, citing higher investment spending on emerging businesses and a spike in mortality claims. While many investors appear concerned with the company’s elevated spending on what may seem to be initiatives with uncertain outcomes, we remain confident in Discovery’s long-term growth opportunities and see the stock-price weakness as a temporary overreaction.
Muangthai Capital Public Co. Ltd., a provider of lending services in Thailand, was also a large detractor. Uncertainty around pending regulation of non-bank financial companies in Thailand and the effect it might have on current interest rates and fees has been substantially resolved.
OUTLOOK
While specific externalities have been overwhelming many frontier and small emerging markets, including the strong U.S. dollar, others such as weakening commodity prices and external imbalances have largely turned neutral to positive. We believe that the difficult adjustments many frontier and emerging small countries are continuing to make will allow economic stability to continue to improve. Egypt is a good example of how structural reforms are now paying off with better stability and an environment that is more supportive of companies’ efforts to meet their long-term strategic goals.
By continually striving to position the Fund in what we regard as the highest-quality companies across frontier markets and small emerging-market countries, we believe we provide the Fund with the best chance of reaping the potential long-term rewards.
We believe that bottom-up analysis and travel to the regions in which we invest are critical, as economic growth, political structures and willingness to reform vary widely in developing countries. We continue to travel extensively and are excited about the future of frontier and emerging small countries and their expanding role in the global economy.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
12
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| WASATCH FRONTIER EMERGING SMALL COUNTRIES FUND (WAFMX / WIFMX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX
MONTHS* | | 1 YEAR | | 5 YEARS | | SINCE INCEPTION 1/31/12 |
Frontier Emerging Small Countries (WAFMX) — Investor | | | | 3.98% | | | | | -12.12% | | | | | -3.39% | | | | | 4.14% | |
Frontier Emerging Small Countries (WIFMX) — Institutional | | | | 3.95% | | | | | -12.04% | | | | | -3.25% | | | | | 4.25% | |
MSCI Frontier Emerging Markets Index | | | | 5.08% | | | | | -8.00% | | | | | 0.31% | | | | | 3.86% | |
MSCI Frontier Markets Index | | | | 2.25% | | | | | -15.00% | | | | | 0.57% | | | | | 5.94% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Frontier Emerging Small Countries Fund are Investor Class — Gross: 2.31%, Net: 2.17%/Institutional Class — Gross: 2.07%, Net: 1.98%. The expense ratio shown elsewhere in this report may be different. Net expenses are based on Fund expenses, net of waivers and reimbursements. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Performance for the Institutional Class prior to 2/1/2016 is based on the performance of the Investor Class. Performance of the Fund’s Institutional Class prior to 2/1/2016 uses the actual expenses of the Fund’s Investor Class without any adjustments. For any such period of time, the performance of the Fund’s Institutional Class would have been substantially similar to, yet higher than, the performance of the Fund’s Investor Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses.
Investing in small cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds. Investing in foreign securities, especially in frontier and emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus.
TOP 10 EQUITY HOLDINGS**
| | | | |
Company | | % of Net
Assets | |
| |
| Globant S.A.(Argentina) | | | 4.5% | |
| |
| ASA International Group plc(United Kingdom) | | | 4.3% | |
| |
| Safaricom plc(Kenya) | | | 4.3% | |
| |
| PT Bank Central Asia Tbk(Indonesia) | | | 4.2% | |
| |
| Naspers Ltd., Class N(South Africa) | | | 4.0% | |
| | | | |
Company | | % of Net
Assets | |
| |
| Grupo Aeroportuario del Sureste S.A.B. de C.V., Class B(Mexico) | | | 4.0% | |
| |
| Raia Drogasil S.A.(Brazil) | | | 3.9% | |
| |
| Clicks Group Ltd.(South Africa) | | | 3.9% | |
| |
| Commercial International Bank S.A.E. (Egypt) | | | 3.9% | |
| |
| Cleopatra Hospital(Egypt) | | | 3.8% | |
| ** | As of March 31, 2019, there were 37 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| †† | Also includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees.‡Inception: January 31, 2012. TheMSCI Frontier Emerging Markets andMSCI Frontier Markets indexes are free float-adjusted market capitalization indexes designed to measure the equity market performance of the global frontier and emerging markets.You cannot invest directly in these or any indexes.
13
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| WASATCH GLOBAL OPPORTUNITIES FUND (WAGOX / WIGOX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Global Opportunities Fund is managed by a team of Wasatch portfolio managers led by JB Taylor, Ajay Krishnan, Ken Applegate and Paul Lambert.
| | | | |
JB Taylor Lead Portfolio Manager | |
Lead Portfolio Manager Ajay Krishnan, CFA | | OVERVIEW Led by the U.S. — and growth stocks in particular — the MSCI ACWI Small Cap Index snapped back from its fourth-quarter swoon. The Index gained 13.10% for the first quarter of 2019, recouping a good portion of the losses from the prior period. The Wasatch Global Opportunities Fund — Investor Class outpaced its benchmark, advancing 16.78%. In our view, global equities were due for a recovery. We saw the fourth- |
Ken Applegate, CFA Portfolio Manager | |
Paul Lambert Portfolio Manager |
quarter selloff as the product of an event-driven market that didn’t reflect continuing fundamental business strength both in the U.S. and elsewhere.
During the first quarter, the U.S. Federal Reserve (Fed), after signaling a “patient” approach to raising interest rates, projected no further rate hikes this year, downgraded its outlook for U.S. economic growth and said it would stop shrinking its balance sheet in September. The Fed’s moves undercut the U.S. dollar, making investments in international stocks outside the U.S. somewhat more attractive to investors. Hopes of a constructive solution to the U.S.-China trade dispute also buoyed the markets.
DETAILSOFTHE QUARTER
The U.S., aided in particular by strong results from information-technology companies, contributed the most to the Fund’s outperformance of the Index in the first quarter. Japan was the next-best country contributor.
The Fund’s top-contributing holding for the quarter was MercadoLibre, Inc., which operatese-commerce platforms in Brazil and other Latin American countries. MercadoLibre’s payment solution, MercadoPago, is driving strong growth at the company as an increasing number ofe-commerce sites andbrick-and-mortar retailers adopt MercadoPago as a preferred payment method.
The second-best contributor was U.S.-based financial transaction processing services provider Euronet Worldwide, Inc. All three segments of the business — Electronic Financial Transaction (EFT) Processing, Money Transfer and epay — showed double-digit operating-profit growth driven by margin expansion, with particular strength in epay.
Zendesk, Inc. was another top contributor from the U.S. information-technology sector. ThisSoftware-as-a-Service company focuses on providing customer service and engagement products that help organizations support their customers across various channels including phone, chat, email and social media. Zendesk continued to execute its growth plans.
The greatest detractor from Fund performance wasMetro Bank plc. This U.K. retail bank has been disrupting the high street banking industry and winning new customers with its customer-first, employee-empowered strategy and culture. During the quarter, an internal misclassification forced Metro to raise its risk weightings on certain commercial-property loans andbuy-to-let mortgages. This required a capital increase 12% higher than analysts had been expecting. Despite the volatility in Metro’s stock price and short-term uncertainties, we believe there is significant upside potential if the company can execute its business strategy.
Cimpress N.V., a “mass-market customization” printed-materials provider, also weighed on Fund performance. The company reported surprisingly disappointing results across its business lines, owing in part to higher customer-acquisitions costs. We’re looking into our concerns regarding the competitive environment.
Finally, the Fund’s position in Sangamo Therapeutics, Inc.was down for the quarter. A clinical-stage biopharmaceutical company, Sangamo specializes in the treatment and cure of gene disorders. Investors reacted negatively to interim results from an early-stage study using the company’szinc-finger editing technology for the treatment of Hurler syndrome. However, we think it’s too early to draw conclusions until results from the study’s high-dose subjects have been released.
OUTLOOK
After the swift snapback in stock prices that we’ve seen thus far in 2019, we’re remaining watchful of heightened equity valuations. Over the longer term, we believe that the fundamentals supporting the growth of the U.S. economy remain in place. While incoming data suggest softening of industrial-production numbers, businesses are generally cautiously optimistic. Bolstered by more accommodative Fed policy, stocks may have further room to appreciate in 2019, particularly if driven by positive economic political catalysts.
In Japan, where stocks generally experienced a difficult fourth quarter, valuations of many companies bounced back in the first quarter. We continue to see strong fundamentals among our Japanese holdings.
For stocks in the United Kingdom, uncertainty is the greatest problem caused by Brexit. As we have said before, many of the Fund’s U.K. holdings generate the majority of their earnings in foreign markets.
We continue to monitor global political and economic developments that could affect the Fund’s performance. At the same time, our primary focus remains, as ever, on investing in companies with solid fundamentals and strong long-term growth prospects.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
14
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| WASATCH GLOBAL OPPORTUNITIES FUND (WAGOX / WIGOX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
Global Opportunities (WAGOX) — Investor | | | | -2.68% | | | | | 2.32% | | | | | 8.42% | | | | | 15.82% | |
Global Opportunities (WIGOX) — Institutional | | | | -2.68% | | | | | 2.57% | | | | | 8.53% | | | | | 15.88% | |
MSCI ACWI Small Cap Index | | | | -5.85% | | | | | -2.72% | | | | | 5.54% | | | | | 14.29% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Global Opportunities Fund are Investor Class: 1.55% / Institutional Class — Gross: 1.66%, Net: 1.36%. The expense ratio shown elsewhere in this report may be different. Net expenses are based on Fund expenses, net of waivers and reimbursements. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Performance for the Institutional Class prior to 2/1/2016 is based on the performance of the Investor Class. Performance of the Fund’s Institutional Class prior to 2/1/2016 uses the actual expenses of the Fund’s Investor Class without any adjustments. For any such period of time, the performance of the Fund’s Institutional Class would have been substantially similar to, yet higher than, the performance of the Fund’s Investor Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses.
Investing in small and micro cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds. Investing in foreign securities, especially in emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus.
TOP 10 EQUITY HOLDINGS**
| | | | |
| Company | | % of Net
Assets | |
| |
| Euronet Worldwide, Inc. | | | 3.1% | |
| |
| Ensign Group, Inc. (The) | | | 2.7% | |
| |
| Copart, Inc. | | | 2.7% | |
| |
| Zendesk, Inc. | | | 2.4% | |
| |
| Globant S.A.(Argentina) | | | 2.3% | |
| | | | |
| Company | | % of Net
Assets | |
| |
| Trex Co., Inc. | | | 2.2% | |
| |
| Monro, Inc. | | | 2.2% | |
| |
| Medytox, Inc.(Korea) | | | 2.2% | |
| |
| MercadoLibre, Inc.(Brazil) | | | 2.1% | |
| |
| HubSpot, Inc. | | | 2.0% | |
| ** | As of March 31, 2019, there were 74 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| †† | Also includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheMSCI ACWI (All Country World Index) Small Cap Index is a free float-adjusted market capitalization index designed to measure the performance of small capitalization securities in developed and emerging markets.You cannot invest directly in this or any index.
15
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| WASATCH GLOBAL VALUE FUND (FMIEX / WILCX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Global Value Fund is managed by a team of Wasatch portfolio managers led by David Powers.
| | |
David Powers, CFA Lead Portfolio Manager | | OVERVIEW The Wasatch Global Value Fund —
Investor Class gained 9.64% in the first quarter of 2019, but underperformed the benchmark MSCI ACWI (All Country World Index), which returned 12.18%. Large-cap U.S. equities, as measured by the S&P 500® Index, returned 13.65% in the quarter compared to 9.98% for large- andmid-cap international equities as gauged by the MSCI |
EAFE Index. After the fourth-quarter 2018 rout in financial markets, the Federal Reserve (Fed) signaled a patient approach entering 2019 and eventually indicated it would likely hold interest rates steady throughyear-end. The European Central Bank and the People’s Bank of China also moved toward more-stimulative stances. Taken together with indications of progress toward resolving the U.S.-China trade dispute, the tenor of central-bank communications outweighed investor concerns about slowing global economic growth.
Within the global equity universe, information technology, real estate and energy were outperforming sectors, while health care and financials were underperforming sectors. The Fund benefited relative to its benchmark from stock selection in the energy, real-estate and materials sectors. While information technology was the leading contributor to the Fund’s return, our underweight position in the sector detracted from relative performance as did our selection of consumer-discretionary holdings.
The United States, the United Kingdom (U.K.) and Switzerland added the most to the Fund’s return. Relative to the benchmark, the U.K. and Switzerland were strong contributors, while the U.S., China and Japan were significant detractors. As ofquarter-end, a little over half of the Fund’s assets were invested in the U.S. with the remainder spread across 13 other countries. Outside the U.S., our typical country weight is small and driven predominantly by company- and sector-specific factors.
DETAILSOFTHE QUARTER
EPR Propertieswas the top contributor to Fund performance in the first quarter. A real estate investment trust (REIT), EPR owns recreational and entertainment properties including megaplex theaters, amusement parks and ski areas, as well as properties leased to charter schools, private schools and early-education providers. With a dividend of nearly 6%, EPR’s shares benefited in the quarter along with the larger REIT segment as interest rates declined and the Fed signaled a halt to hikes in its benchmark rate. In addition, issues around a delinquent educational tenant that leases a number of EPR properties moved closer toward resolution.
Technology company Cisco Systems, Inc.was the second-best contributor. Cisco has recently begun to reap the benefits of an investment cycle, seeing a notable increase in
recurring revenue as it moves from selling hardware and networking services to a subscription-based business model.
Within energy, exploration and production company Suncor Energy, Inc.performed well. Suncor specializes in the development of oil sands to produce bitumen (asphalt), which can be used in paving and roofing materials or refined into higher-value synthetic crude oil or diesel fuel. Suncor shares benefited in the quarter as the price of oil rose more than 25% supported by OPEC production cuts.
On the downside, our large position in CVS Health Corp.weighed heavily on performance. Investors were disappointed by management’s guidance for the retail drugstore and pharmacy benefit management (PBM) businesses. More broadly, investors are concerned about the pricing environment for PBMs, given proposals to eliminate rebates paid by drug companies and political rhetoric around lowering drug prices. Disappointing earnings from competitor Walgreens did nothing to boost optimism for CVS stock. The company’s cash flow and dividend remain attractive, and we believe CVS is well-positioned for the long term given its many consumer touchpoints. However, given the complexity in valuing the stock, we trimmed the position in the quarter.
Taiwan financial-services company Fubon Financial Holding Co. Ltd. was the second-largest detractor. In addition to its principal life-insurance arm, Fubon has a significant banking and investment business, which posted poor results in the wake of the fourth-quarter 2018 equity-market decline. The unit was also negatively affected by currency-hedging costs and exchange-rate losses. We view Fubon as an excellent way to gain exposure to Asia’s developing middle class.
An overweight position inJapan Airlines Co. Ltd.detracted from relative performance in the quarter as rising fuel costs impacted investor sentiment regarding the broader airline segment. Investors have also been concerned that the airline may make a significant expenditure on international airport slots in therun-up to the 2020 Olympics in Tokyo. We view any such investment as likely to benefit the long-term outlook for Japan Airlines and have maintained the position.
OUTLOOK
The rebound in global equities in early 2019 reflected investors’ perception that risks to corporate-earnings growth had been reduced given signals of monetary support from major central banks, a somewhat better outlook for U.S.-China trade relations and large-scale stimulus being injected into China’s economy. At current levels, stock prices appear quite vulnerable to any signs of softening earnings. With growth stocks trading at significant premiums as investors anticipate the end of the current cycle, value stocks appear attractive on a relative basis.
We continue to prefer a defensive-minded approach that we expect to be beneficial as late-cycle dynamics gain traction. The Fund remains tilted toward higher-quality companies within the globallarge-cap value universe, as gauged by lower market sensitivity, lower valuations, higher cash flows, higher dividends and stronger balance sheets.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
16
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| WASATCH GLOBAL VALUE FUND (FMIEX / WILCX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
Global Value (FMIEX) — Investor | | | | -1.80% | | | | | 5.33% | | | | | 6.35% | | | | | 10.99% | |
Global Value (WILCX) — Institutional | | | | -1.72% | | | | | 5.49% | | | | | 6.50% | | | | | 11.09% | |
MSCI ACWI | | | | -2.13% | | | | | 2.60% | | | | | 6.45% | | | | | 11.98% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Global Value Fund are Investor Class — Gross: 1.19%, Net: 1.11% / Institutional Class — Gross: 1.58%, Net: 0.95%. The expense ratio shown elsewhere in this report may be different. Net expenses are based on Fund expenses, net of waivers and reimbursements. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Performance for the Institutional Class prior to 1/31/2012 is based on the performance of the Investor Class. Performance of the Fund’s Institutional Class prior to 1/31/2012 uses the actual expenses of the Fund’s Investor Class without any adjustments. For any such period of time, the performance of the Fund’s Institutional Class would have been substantially similar to, yet higher than, the performance of the Fund’s Investor Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses.
Investments in value stocks can perform differently from the market as a whole and from other types of stocks and can continue to be undervalued by the market for long periods of time. Investing in foreign securities entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus. Loss of principal is a risk of investing.
TOP 10 EQUITY HOLDINGS**
| | | | |
| Company | | % of Net
Assets | |
| |
| Novartis AG(Switzerland) | | | 4.3% | |
| |
| Exelon Corp. | | | 4.3% | |
| |
| Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen(Germany) | | | 4.3% | |
| |
| Royal Dutch Shell plc ADR(United Kingdom) | | | 4.3% | |
| |
| China Mobile Ltd.(China) | | | 4.2% | |
| | | | |
| Company | | % of Net
Assets | |
| |
| Wells Fargo & Co. | | | 3.8% | |
| |
| Pfizer, Inc. | | | 3.7% | |
| |
| AT&T, Inc. | | | 3.5% | |
| |
| EPR Properties | | | 3.4% | |
| |
| Entergy Corp. | | | 3.4% | |
| ** | As of March 31, 2019, there were 36 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| †† | Also includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheMSCI ACWI (All Country World Index) captures large- and mid-cap representation across 23 developed-market and 24 emerging-market countries. With 2,771 constituents, the Index covers approximately 85% of the global investable equity opportunity set.You cannot invest directly in this or any index.
17
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| WASATCH INTERNATIONAL GROWTH FUND (WAIGX / WIIGX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch International Growth Fund is managed by a team of Wasatch portfolio managers led by Ken Applegate, Roger Edgley and Linda Lasater.
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Ken Applegate, CFA Lead Portfolio Manager | | 
Roger Edgley, CFA Portfolio Manager | | 
Linda Lasater, CFA Portfolio Manager |
OVERVIEW
The Wasatch International Growth Fund — Investor Class gained 13.72% in the first quarter of 2019, outperforming the MSCI ACWI (All Country World Index) ex USA Small Cap Index, which returned 10.26%.
Astute investors know that wealth is created by focusing on the long term and letting the power of compounding work its magic. During the first quarter of 2019, equity markets had a strong rally following a weak fourth quarter. Althoughquarter-to-quarter swings in performance can be quite distracting, the important point we want to make is that the more you stay focused on the long term and the longer your timeframe, the more the power of compounding can work for you. For example, the Fund’s average annual total return for the 10 years ended March 31, 2019 was 15.96% compared to 11.86% for the Index. In other words, if a shareholder had hypothetically invested $10,000 in the Wasatch International Growth Fund 10 years ago on March 31, 2009, it would have been worth nearly $44,000 as of March 31, 2019, versus about $31,000 if one had invested the same amount in the Index.* This is the power of compounding.
DETAILSOFTHE QUARTER
Wasatch’s investment team visited the United Kingdom during January and found that Brexit-related uncertainties continued to prevail. Most U.K. companies have been preparing for a hard Brexit — the U.K. leaves the European Union without a deal — and weakness was evident in many domestic-facing companies. We reduced our exposure to U.K. domestic-focused companies following the 2016 referendum. Since then, the majority of the Fund’s U.K.-listed holdings derive a meaningful portion of their earnings and growth from outside the country.
An example is Fevertree Drinks plc, a strong contributor to the Fund’s first-quarter performance. London-based Fevertree provides premium tonics and drink mixers. After refining the Fevertree brand in the U.K., it has been successfully expanding globally. The initial foray abroad was to Europe, where Fevertree is now seeing strong growth. More recently, the company has been expanding throughout the U.S. Fevertree reported another quarter of strong financial results.
The greatest detractor from Fund performance wasMetro Bank plc, a retail bank in the U.K. that has been disrupting the high street banking industry and winning new customers with its customer-first, employee-empowered strategy and culture. During the quarter, an internal misclassification forced Metro to raise its risk weightings on certain commercial-property loans andbuy-to-let mortgages. This required a capital increase 12% higher than analysts had been expecting. Despite the volatility in Metro’s stock price and short-term uncertainties, we believe that if the company can execute its business strategy, there will be significant upside potential.
Japan, the Fund’s largest country weighting, added significantly to the Fund’s return and outperformance of the benchmark in the first quarter. Although the fourth quarter was difficult from a stock-price performance perspective, it provided us the opportunity to add to what we consider some of our highest-quality companies. An example is Nihon M&A Center, Inc., which has seen business reaccelerate following a slowdown in deal flow last year. With business succession a growing issue in Japan, Nihon M&A helps small-business owners, often those nearing retirement, to find buyers for their companies. Nihon M&A ended the first quarter as one of the Fund’s top contributors.
Conversely, Pigeon Corp., a Japanese provider of baby bottles, lotions and related products, detracted from Fund performance as earnings were below expectations due to weak sales in China. Our research indicates this weakness is likely transitory. Pigeon continues to innovate and has two key product launches scheduled, which we believe will accelerate growth in years to come.
OUTLOOK
In May, we will spend two weeks in Europe, where we see positive changes occurring. Although Europe faces numerous headwinds — including weak economic data — valuations relative to other developed regions are becoming more compelling.
The U.K. remains a challenging investment environment but the country has a deep pool of high-quality companies, many of which generate the majority of their earnings outside the U.K. This is a key reason the Fund is overweight versus the benchmark in the U.K.
Despite being one of the world’s largest developed economies, Japan’s market is still inefficient and misunderstood by many investors, which provides opportunities for us to use our expertise andon-the-ground research to find companies with outstanding investment potential.
We remain confident in the ability of our companies across the globe to navigate turbulent environments by virtue of their experienced management teams, solid business models and strong competitive positions. We remain optimistic regarding their long-term prospects given recent meetings and calls with management teams, which point to continued investment in their businesses.
Thank you for the opportunity to manage your assets.
| * | Please see the “Growth of a Hypothetical $10,000 Investment” graph on the next page. |
| | Current and future holdings are subject to risk. |
18
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| WASATCH INTERNATIONAL GROWTH FUND (WAIGX / WIIGX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
International Growth (WAIGX) — Investor | | | | -10.69% | | | | | -8.51% | | | | | 4.47% | | | | | 15.96% | |
International Growth (WIIGX) — Institutional | | | | -10.63% | | | | | -8.40% | | | | | 4.54% | | | | | 16.00% | |
MSCI ACWI ex USA Small Cap Index | | | | -5.64% | | | | | -9.49% | | | | | 3.26% | | | | | 11.86% | |
MSCI World ex USA Small Cap Index | | | | -7.00% | | | | | -8.66% | | | | | 3.69% | | | | | 12.25% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch International Growth Fund are Investor Class: 1.45% / Institutional Class — Gross: 1.36%, Net: 1.35%. The expense ratio shown elsewhere in this report may be different. Net expenses are based on Fund expenses, net of waivers and reimbursements. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Performance for the Institutional Class prior to 2/1/2016 is based on the performance of the Investor Class. Performance of the Fund’s Institutional Class prior to 2/1/2016 uses the actual expenses of the Fund’s Investor Class without any adjustments. For any such period of time, the performance of the Fund’s Institutional Class would have been substantially similar to, yet higher than, the performance of the Fund’s Investor Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses.
Investing in foreign securities, especially in frontier and emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus. Investing in small cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds.
TOP 10 EQUITY HOLDINGS**
| | | | |
| Company | | % of Net
Assets | |
| |
| Vitasoy International Holdings Ltd.(China) | | | 3.0% | |
| |
| XING SE(Germany) | | | 2.3% | |
| |
| Fevertree Drinks plc(United Kingdom) | | | 2.0% | |
| |
| Cochlear Ltd.(Australia) | | | 2.0% | |
| |
| MISUMI Group, Inc.(Japan) | | | 1.8% | |
| | | | |
| Company | | % of Net
Assets | |
| |
| Nihon M&A Center, Inc.(Japan) | | | 1.8% | |
| |
| Chr. Hansen Holding A/S(Denmark) | | | 1.8% | |
| |
| Asahi Intecc Co. Ltd.(Japan) | | | 1.8% | |
| |
| Patrizia Immobilien AG(Germany) | | | 1.8% | |
| |
| Abcam plc(United Kingdom) | | | 1.7% | |
| ** | As of March 31, 2019, there were 88 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| ††Also | includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheMSCI ACWI (All Country World Index) ex USA Small Cap Index is a free float-adjusted market capitalization index designed to measure the performance of small capitalization securities in developed markets, excluding the United States, and in emerging markets. TheMSCI World ex USA Small Cap Index is a free float-adjusted market capitalization index designed to measure the performance of small capitalization securities in developed markets, excluding the United States.You cannot invest directly in these or any indexes.
19
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| WASATCH INTERNATIONAL OPPORTUNITIES FUND (WAIOX / WIIOX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch International Opportunities Fund is managed by a team of Wasatch portfolio managers led by Linda Lasater, Jared Whatcott and Allison He.
| | | | |
Lead Portfolio Manager Linda Lasater, CFA | | 
Jared Whatcott, CFA Portfolio Manager | | 
Allison He, CFA Associate Portfolio Manager |
OVERVIEW
The International Opportunities Fund — Investor Class was up 13.49% for the first quarter and outperformed the benchmark MSCI ACWI ex USA Small Cap Index, which rose 10.26%.
The first quarter of 2019 saw a strong rebound in the world’s equity markets as concerns about a potential escalation in the U.S.-China trade dispute and worries that higher interest rates would dampen global growth quickly faded with the New Year.
While a number of economic and political risks could potentially slow global growth and increase equity-market volatility, keeping our focus on investing in high-quality companies is the best way we know to mitigate those risks. With that perspective, we aim to construct a portfolio ofmicro-cap businesses with sustainable competitive advantages that are able to thrive, not just survive, in uncertain environments like those we have been witnessing.
DETAILSOFTHE QUARTER
The countries that made the largest contributions to Fund performance during the first quarter were Japan, Australia and China. The United Kingdom was the largest detractor from performance relative to the benchmark.
Japan regained its title as the largest contributor to the Fund’s return in the quarter. Leading the way for Japan was Digital Arts, Inc., a developer of email-filtering andweb- security software. With sales to public-sector customers accelerating, Digital Arts also has been seeing margin expansion, leading to strong stock performance on the back of a vigorous rebound in Japan’s information-technology (IT) sector.
In Australia, following lackluster gross domestic product (GDP) growth and consumer spending in 2018, as well as a housing downturn last year, the equity market roared to life in 2019, with the health-care and IT sectors performing especially well. Pro Medicus Ltd. was the top overall contributor to Fund performance. This Australian company provides enterprise medical imaging and radiology information system software to world-class medical groups, and has been seeing strong revenue growth and margin expansion.
Australia’s Webjet Ltd., an online travel-booking company, was another strong contributor. Webjet continued to
grab market share and was able to achieve profit-margin targets earlier than had been expected.
The Fund’s performance in China was helped by Yihai International Holdings Ltd., our second-best contributor. Yihai makes and sells hotpot soup flavorings, hotpot dipping sauces and Chinese-style compound condiments under its parent’s Haidilao brand name. Yihai reported strong results for the second half of its fiscal year.
While we were pleased with the performance of the aforementioned companies, the performance of a few companies was disappointing. The Fund’s biggest detractors from performance for the quarter were accesso Technology Group plc, TCI Co. Ltd. and Qol Co. Ltd.
London-listedaccesso develops IT solutions such as virtual queuing, ticketing, point of sales, group ticketing and guest management for entertainment and leisure venues. Following some earlier issues regarding a surprise increase in research and development spending as well as increased capitalization of product development, the company recently announced unexpected management changes while not adequately addressing questions regarding future investment plans. We exited the position due to lack of confidence.
Taiwanese health-supplement maker TCI was the Fund’s second-largest detractor for the quarter on concerns over China’s regulatory crackdown on inaccurate advertising. Our team discussed the issue with TCI management and came away feeling comfortable that the regulatory concerns are not likely to impact growth. Furthermore, we believe the opportunity in health food and beauty products remains intact.
Japan-listed dispensing pharmacy Qol was the third-largest detractor. In addition to a regulation change in Japan that disproportionately affects dispensing pharmacies, Qol’s earnings have not met our expectations. We decided to move on.
OUTLOOK
International equity markets ended the first quarter riding a wave of optimism over less contentious U.S.-China trade relations as well as more-dovish central-bank attitudes. It remains to be seen, however, whether easier monetary policy and more-stable trade policies will be enough to support the global equity markets through the rest of 2019. China bears watching to see if the government’s efforts will be enough to adequately stimulate domestic Chinese demand.
We continue to find many gems amongmicro-cap companies in the Japanese market. In addition to Japan, the Wasatch team made research trips to the U.K., India and Taiwan during 2019’s first quarter. We found a number of exciting new names and invested in companies that we see as high quality.
Our ongoing travels to the four corners of the globe have given us opportunities to refine the Fund as we have met with the management teams of prospective investments and current holdings alike. As we gain confidence in the business models and strategies of our portfolio companies, our optimism for the Fund’s long-term prospects also grows.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
20
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| WASATCH INTERNATIONAL OPPORTUNITIES FUND (WAIOX / WIIOX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
International Opportunities (WAIOX) — Investor | | | | -5.85% | | | | | -4.79% | | | | | 7.18% | | | | | 16.41% | |
International Opportunities (WIIOX) — Institutional | | | | -5.79% | | | | | -4.47% | | | | | 7.42% | | | | | 16.54% | |
MSCI ACWI ex USA Small Cap Index | | | | -5.64% | | | | | -9.49% | | | | | 3.26% | | | | | 11.86% | |
MSCI World ex USA Small Cap Index | | | | -7.00% | | | | | -8.66% | | | | | 3.69% | | | | | 12.25% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch International Opportunities Fund are Investor Class: 2.09% / Institutional Class — Gross: 1.96%, Net: 1.95%. The expense ratio shown elsewhere in this report may be different. Net expenses are based on Fund expenses, net of waivers and reimbursements. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Performance for the Institutional Class prior to 2/1/2016 is based on the performance of the Investor Class. Performance of the Fund’s Institutional Class prior to 2/1/2016 uses the actual expenses of the Fund’s Investor Class without any adjustments. For any such period of time, the performance of the Fund’s Institutional Class would have been substantially similar to, yet higher than, the performance of the Fund’s Investor Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses.
Investing in foreign securities, especially in frontier and emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus. Investing in micro cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds.
TOP 10 EQUITY HOLDINGS**
| | | | |
| Company | | % of Net
Assets | |
| |
| Pro Medicus Ltd.(Australia) | | | 3.1% | |
| |
| Yihai International Holding Ltd.(China) | | | 2.4% | |
| |
| Vitasoy International Holdings Ltd.(China) | | | 2.4% | |
| |
| Hypoport AG(Germany) | | | 2.3% | |
| |
| Philippine Seven Corp.(Philippines) | | | 2.2% | |
| | | | |
| Company | | % of Net
Assets | |
| |
| Webjet Ltd.(Australia) | | | 2.0% | |
| |
| Open Door, Inc.(Japan) | | | 2.0% | |
| |
| Gulf Oil Lubricants India Ltd.(India) | | | 2.0% | |
| |
| V-Mart Retail Ltd.(India) | | | 1.7% | |
| |
| Fortnox AB(Sweden) | | | 1.6% | |
| ** | As of March 31, 2019, there were 98 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| ††Also | includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheMSCI ACWI (All Country World Index) ex USA Small CapIndexis a free float-adjusted market capitalization index designed to measure the performance of small capitalization securities in developed markets, excluding the United States, and in emerging markets. TheMSCI World ex USA Small Cap Indexis a free float-adjusted market capitalization index designed to measure the performance of small capitalization securities in developed markets, excluding the United States.You cannot invest directly in these or any indexes.
21
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| WASATCH MICRO CAP FUND (WMICX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Micro Cap Fund is managed by a team of Wasatch portfolio managers led by Ken Korngiebel and Dan Chace.
| | | | |
Ken Korngiebel, CFA Lead Portfolio Manager | | 
Dan Chace, CFA Portfolio Manager | | OVERVIEW Micro-cap equities staged a strong rally during the first quarter of the year, recouping some of the ground lost during the final months of 2018. The benchmark Russell Microcap Index |
rose 13.10%. The Wasatch Micro Cap Fund surpassed the Index with a gain of 18.86%.
U.S. stocks advanced as the Federal Reserve (Fed) in January signaled a “patient” approach to raising interest rates and then went a step further in March by saying that another hike in 2019 would be unlikely. Improved hopes for a speedy resolution to the U.S.-China trade dispute also underpinned support for equities.
Yields on U.S. Treasury bonds and notes fell sharply in March as the Fed downgraded its forecast for the U.S. economy and announced the end of its program to reduce the debt securities it holds on its balance sheet. With the weaker outlook threatening to crimp demand for loans and further depress lending rates, financial stocks were significant laggards. However, the Fund’s below-benchmark exposure to financials — about 9% compared to about 24% for the Index — significantly benefited relative performance.
For the most part, the prospect of lower interest rates and scarce growth in the economy made the innovative, growing companies we seek to own more appealing to investors. The information-technology (IT) sector was by far the Fund’s largest source of outperformance relative to the benchmark, followed by industrials, consumer discretionary and communication services.
DETAILSOFTHE QUARTER
The strongest contributor to Fund performance for the quarter was Tandem Diabetes Care, Inc. The company offers insulin-delivery systems for people with diabetes. Tandem’s share price jumped in February on better-than-expected quarterly results and strong guidance for 2019. Total pump shipments surged 133% versus theyear-ago quarter, sending revenues 89% higher and pushing earnings into the black sooner than analysts had been expecting.
Cybersecurity companies Rapid7, Inc. and CyberArk Software Ltd.were the Fund’s second- and third-best contributors, respectively. Rapid7 provides analytics solutions including vulnerability management and incident detection. Helped by the shift to a subscription-based business model and increased demand, revenues in Rapid7’s most-recent quarter surpassed Wall Street estimates.
CyberArk specializes in products and services for organizations to safeguard and monitor their privileged accounts.
Adjusted earnings per share jumped 117% in the company’s most-recent quarter on 36% revenue growth. Management said the trend toward cloud-based computing is boosting demand for CyberArk’s cybersecurity solutions and helping to make the company a “critical component” of its customers’ digital transformations.
The greatest detractor from Fund performance for the quarter was Metro Bank plc. One of theso-called challenger banks established in the U.K. after the financial crisis, Metro is noted for outstanding customer experience. In January, the bank disclosed that it had applied an incorrectly low risk weighting to parts of its loan book. In February, Metro revealed that it would have to raise additional equity in order to put more capital behind the misclassified loans. The bank now faces the prospect of having to issue stock at prices that are highly dilutive to the ownership stakes of existing shareholders. Events at Metro Bank have raised concerns about the bank’s internal controls — and management’s shifting account as to how the errors were discovered hasn’t soothed investors. Meanwhile, the bank’s ambitious growth plans have largely been shelved until the equity raise has been completed. We continue to hold the stock at a low weight but are watching developments closely.
The second-largest detractor was USANA Health Sciences, Inc. The company manufactures and sells nutritional supplements and personal-care products directly to associates and customers in the U.S. and other countries. USANA’s stock price declined amid ongoing regulatory questions in China that were first disclosed about two years ago. With the company’s internal investigation into the matter now substantially complete, management reported that it doesn’t expect a material impact. In our own experience, it’s not unusual for firms employing USANA’s multi-level distribution model to attract the attention of regulators. We remain patient pending further developments.
Sangamo Therapeutics, Inc.was another significant detractor. A clinical-stage biopharmaceutical company, Sangamo specializes in the treatment and cure of gene disorders. Investors reacted negatively to interim results from an early-stage study using the company’szinc-finger editing technology for the treatment of Hurler syndrome. However, we think it’s too early to draw conclusions until results from the study’s high-dose subjects have been released.
OUTLOOK
Although the Fed’s policy shift appeared to alter investor perceptions during the first quarter, our investment process doesn’t depend on a particular outlook or forecast. Regardless of which types of stocks happen to be in or out of vogue, we continue to do our job the same way. Asbottom-up, fundamental investors focused on the long term, we seek companies that can grow regardless of the overall economic environment. We believe our disciplined, research-driven investment approach has the potential to generate attractive returns over time.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
22
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| WASATCH MICRO CAP FUND(WMICX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
Micro Cap | | | | -5.53% | | | | | 15.71% | | | | | 12.05% | | | | | 18.43% | |
Russell Microcap® Index | | | | -11.94% | | | | | -2.36% | | | | | 5.03% | | | | | 14.97% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Micro Cap Fund are 1.65%. The expense ratio shown elsewhere in this report may be different. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Investing in micro cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds. Investing in foreign securities, especially in emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus.
TOP 10 EQUITY HOLDINGS**
| | | | |
| Company | | % of Net
Assets | |
| |
| V-Mart Retail Ltd.(India) | | | 2.2% | |
| |
| Freshpet, Inc. | | | 2.1% | |
| |
| Kadant, Inc. | | | 2.1% | |
| |
| CyberArk Software Ltd.(Israel) | | | 2.1% | |
| |
| Kornit Digital Ltd.(Israel) | | | 2.1% | |
| | | | |
| Company | | % of Net
Assets | |
| |
| Bandwidth, Inc., Class A | | | 2.0% | |
| |
| Upland Software, Inc. | | | 2.0% | |
| |
| Tandem Diabetes Care, Inc. | | | 1.9% | |
| |
| Fabrinet | | | 1.8% | |
| |
| Rapid7, Inc. | | | 1.8% | |
| ** | As of March 31, 2019, there were 85 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| ††Also | includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheRussell Microcap Index is an unmanaged total return index of the smallest 1,000 securities in the small-cap Russell 2000 Index along with the next smallest 1,000 companies, based on a ranking of all U.S. equities by market capitalization. The Russell 2000 Index is an unmanaged total return index of the smallest 2,000 companies in the Russell 3000 Index, as ranked by total market capitalization.You cannot invest directly in these or any indexes.
23
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| WASATCH MICRO CAP VALUE FUND(WAMVX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Micro Cap Value Fund is managed by a team of Wasatch portfolio managers led by Brian Bythrow.
| | |
Brian Bythrow, CFA Lead Portfolio Manager | | OVERVIEW U.S. equity markets rebounded sharply in the first quarter of 2019, with some swaths of the market — high-growth stocks, in particular — now more expensive than they were prior to the fourth quarter’s sharp selloff. The Wasatch Micro Cap Value Fund gained 13.82%, approximately in line with the benchmark Russell Microcap Index, which advanced 13.10%. Dovish commentary from U.S. |
Federal Reserve (Fed) officials kicked off the rebound early in the quarter. In our view, U.S. equities were due for a recovery. We believed the fourth quarter selloff was overdone. We had expected the Fed to strike a more moderate stance on interest rates because inflation has remained tame and there haven’t been many signs of excessive risk-taking among businesses and consumers. Other positives during the quarter included the end of the partial government shutdown andde-escalation of U.S.-Chinatrade-war rhetoric.
During the market’s strong first-quarter upswing, the Fund’s more “growthy” names led the way. We trimmed some of them, including microchip makers Inphi Corp. and MaxLinear, Inc., as stock-price performance increased their weights in the Fund to be larger than we desired. Reducing the size of a position to keep it in line with our ongoing assessment of the company’s growth prospects and valuation level is an important aspect of our risk-management process.
With the U.S. economy still on solid footing, one would normally expect economically cyclical, value-oriented names to be more in favor. Yet investors seem as willing as ever to pay high premiums for growth stocks.
DETAILSOFTHE QUARTER
Inphi and MaxLinear, mentioned above, were among the Fund’s top contributors to first-quarter performance. These companies are leaders in the “connected home” space, which is increasing the need for fast data connections. In our view, Inphi and MaxLinear are poised to benefit as DOCSIS 3.1, a new international cable modem standard, becomes more widely adopted. Both companies also stand to benefit as more new 5G wireless infrastructure is built. We had originally purchased Inphi and MaxLinear asbeaten-up technology names and were pleased to see their stock prices bounce back sharply in the first quarter.
Construction Partners, Inc., an asphalt-paving firm, was another top contributor. The company’s stock price was pulled down in 2018 along with other names in its industry as investors fretted about inflation in road-aggregate asphalt prices. We recognized that Construction Partners’ business was actually somewhat insulated from those price increases and added to our position. When the company announced its most-recent quarterly results, we think investors came to understand that materials pricing really wasn’t an issue, and the stock snapped back in the first quarter.
Among the Fund’s detractors in the first quarter, the two largest were medical-technology companies Neuronetics, Inc. and Ra Medical Systems, Inc. Neuronetics develops devices to treat psychiatric disorders and has seen strong organic growth. The stock’s decline may have been a reflection of investors’ wariness about a new competitor in Neuronetics’ space, but so far we haven’t seen competitive forces impacting the business.
Ra Medical is a newly public company that missed its sales forecast right out of the chute. The company designs and markets lasers and catheters used to treat skin and cardiovascular diseases. What appeared to hold back Ra Medical’s product success, and hurt revenues in the fourth quarter of 2018, was the need to hire qualified sales personnel and improve training for the entire sales team to ensure that doctors are comfortable using the company’s innovative devices. Ra Medical’s management believes that the newly hired chief commercial officer will alleviate the sales-force hiring and training issues.
Finally, the Fund’s position in Sangamo Therapeutics, Inc.was down for the quarter. A clinical-stage biopharmaceutical company, Sangamo specializes in the treatment and cure of gene disorders. Investors reacted negatively to interim results from an early-stage study using the company’szinc-finger editing technology for the treatment of Hurler syndrome. However, we think it’s too early to draw conclusions until results from the study’s high-dose subjects have been released.
OUTLOOK
International stocks have lagged those in the U.S. over the last several years and now appear quite undervalued. While the Fund’s international holdings have also lagged, the businesses themselves have performed quite well. As a result, we believe the Fund’s international stocks will eventually playcatch-up to their U.S. counterparts. We continue to manage down the Fund’s exposure to international industrial activity, which is slowing.
With the Fed softening its policy stance and with the release of strong corporate earnings reports, the U.S. equity market has swung from extreme pessimism in the fourth quarter of 2018 to seemingly boundless optimism so far in 2019. This upward spike in sentiment appears to have generated considerable changes in appetite for investment risk and increased valuations. Given historical patterns following strong market rallies, we wouldn’t be surprised to see stocks pause over the next several months. For the rally to continue throughout 2019, we believe we’ll need to see a more complete resolution of the U.S.-China trade disagreement.
As always, we’ll continue doing what we believe we do best and that is using ourbottom-up research process to find outstandingmicro-cap companies with the potential to contribute to the Fund’s long-term performance.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
24
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| WASATCH MICRO CAP VALUE FUND(WAMVX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
Micro Cap Value | | | | -6.88% | | | | | 5.83% | | | | | 9.33% | | | | | 18.20% | |
Russell Microcap® Index | | | | -11.94% | | | | | -2.36% | | | | | 5.03% | | | | | 14.97% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Micro Cap Value Fund are 1.74%. The expense ratio shown elsewhere in this report may be different. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Investing in micro cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds. Investments in value stocks can perform differently from the market as a whole and from other types of stocks and can continue to be undervalued by the market for long periods of time. Investing in foreign securities, especially in emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus.
TOP 10 EQUITY HOLDINGS**
| | | | |
| Company | | % of Net
Assets | |
| |
| Freshpet, Inc. | | | 2.0% | |
| |
| Fabrinet | | | 1.8% | |
| |
| Construction Partners, Inc., Class A | | | 1.8% | |
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| Arbor Realty Trust, Inc. | | | 1.7% | |
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| Napco Security Technologies, Inc. | | | 1.7% | |
| | | | |
| Company | | % of Net
Assets | |
| |
| Radiant Logistics, Inc. | | | 1.6% | |
| |
| Globant S.A.(Argentina) | | | 1.5% | |
| |
| Esquire Financial Holdings, Inc. | | | 1.5% | |
| |
| OrthoPediatrics Corp. | | | 1.5% | |
| |
| SharpSpring, Inc. | | | 1.5% | |
| ** | As of March 31, 2019, there were 95 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| †† | Also includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheRussell Microcap Index is an unmanaged total return index of the smallest 1,000 securities in the small-cap Russell 2000 Index along with the next smallest 1,000 companies, based on a ranking of all U.S. equities by market capitalization. TheRussell 2000 Index is an unmanaged total return index of the smallest 2,000 companies in the Russell 3000 Index, as ranked by total market capitalization.You cannot invest directly in these or any indexes.
25
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| WASATCH SMALL CAP GROWTH FUND(WAAEX / WIAEX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Small Cap Growth Fund is managed by a team of Wasatch portfolio managers led by JB Taylor, Ken Korngiebel and Ryan Snow.
| | | | |
JB Taylor Lead Portfolio Manager | |
Ken Korngiebel, CFA Portfolio Manager | | 
Ryan Snow Portfolio Manager |
OVERVIEW
Stocks bounced back in the first quarter of 2019. The Wasatch Small Cap Growth Fund — Investor Class gained 20.49% and outpaced the 17.14% return of its primary benchmark, the Russell 2000 Growth Index. The Fund also outperformed the Russell 2000 Index, which was up 14.58%.
The U.S. economy has continued to demonstrate some resilience in the face of slowing global growth and a backdrop of political uncertainty. Nevertheless, a downward revision of fourth-quarter U.S. gross domestic product growth and a forecast of only about 1.5% growth in the first quarter have lowered the economic bar for calendar 2019. The good news is that the U.S. economy is at least slowing from a solid position.
During the first quarter, the information-technology sector delivered the best returns for both the Fund and the Russell 2000 Growth Index. This wasn’t surprising to us given that businesses are increasingly turning to technology to make their operations more efficient in an environment of slower growth, increasing competition and a tight labor market. The Fund benefited relative to the benchmark from excellent stock selection and an overweight allocation in information technology.
Notwithstanding the above comments, the macro environment is not our main focus. One good way to describe our investment approach is that we’re “macro-aware” rather than “macro-driven.” We spend the overwhelming majority of our time kicking the tires of high-quality companies and analyzing their fundamentals. Moreover, when we remain impressed by the operating performance and valuation of our companies, we don’t buy and sell just for the sake of showing activity in the Fund.
DETAILSOFTHE QUARTER
The top contributor to performance for the first quarter was Euronet Worldwide, Inc., an electronic-payments business that operates ATMs, traditionalpoint-of-sale (POS) terminals, prepaid POS terminals and money-transfer networks. The company reported significant increases in operating income and adjusted earnings per share. As is often the case with stronger-than-expected numbers, Euronet’s stock
price soared after the report. We continue to be impressed with the company’s operating discipline — as 2018 was the sixth consecutive year that management delivered double-digit growth in adjusted earnings per share.
Paylocity Holding Corp. also boosted Fund performance. The company provides software for payroll and human-capital management. Paylocity saw its stock price rise after a competitor agreed to be acquired at a premium by a private-equity firm. Incidentally, we also owned that competitor — Ultimate Software Group, Inc. We think Paylocity now stands to benefit as Ultimate adjusts to the influences of its new owners.
The largest detractor from Fund performance was Metro Bank plc, one of theso-called “challenger banks” established in the U.K. after the global financial crisis. Despite Metro’s rapid growth, the stock plunged in January after the bank disclosed that it had applied an incorrectly low risk weighting to parts of its loan book. The stock fell again in February on news that Metro will have to raise additional equity in order to put more capital behind the misclassified loans. The bank now faces the prospect of having to issue stock at prices that are highly dilutive to the ownership stakes of existing shareholders.
Healthcare Services Group, Inc. (HCSG) was also a significant detractor. HCSG provides outsourced housekeeping and nutritional services for hospitals, nursing homes and other health-care institutions. HCSG shares fell sharply in early March after the company disclosed that it would file its 201810-K report 15 days late. Management revealed that the company had received a letter from the Securities and Exchange Commission in November 2017 seeking information about the way HCSG calculates and reports its earnings per share. We continue to monitor the situation for further developments.
OUTLOOK
We’re always aware of macro events but they don’t play major roles in our time-tested, fundamental investment approach. Our fixation is on vigorously analyzing “micro events” that occur at the company-specific level. And while we’re never really just standing still at Wasatch (there’s always another company to research), the first quarter of 2019 was particularly quiet from a trading perspective. This was because the companies we owned were mostly delivering the operating results we had expected.
But we also had a few disappointments like Metro Bank and Healthcare Services Group that are currently under our research microscope. Having said that, our other holdings more than compensated for our disappointments.
In short, we remain as confident as ever that the Wasatch Small Cap Growth Fund currently owns a group of high-quality companies that will grow their top and bottom lines significantly over the coming years. This is exactly the positioning we want to have over the long term — and also during whatever comes next.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
26
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| WASATCH SMALL CAP GROWTH FUND (WAAEX / WIAEX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
Small Cap Growth (WAAEX) — Investor | | | | -2.22% | | | | | 15.62% | | | | | 9.99% | | | | | 17.28% | |
Small Cap Growth (WIAEX) — Institutional | | | | -2.14% | | | | | 15.76% | | | | | 10.11% | | | | | 17.35% | |
Russell 2000® Growth Index | | | | -8.22% | | | | | 3.85% | | | | | 8.41% | | | | | 16.52% | |
Russell 2000® Index | | | | -8.56% | | | | | 2.05% | | | | | 7.05% | | | | | 15.36% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Small Cap Growth Fund are Investor Class: 1.20% / Institutional Class — Gross: 1.09%, Net: 1.05%. The expense ratio shown elsewhere in this report may be different. Net expenses are based on Fund expenses, net of waivers and reimbursements. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Performance for the Institutional Class prior to 2/1/2016 is based on the performance of the Investor Class. Performance of the Fund’s Institutional Class prior to 2/1/2016 uses the actual expenses of the Fund’s Investor Class without any adjustments. For any such period of time, the performance of the Fund’s Institutional Class would have been substantially similar to, yet higher than, the performance of the Fund’s Investor Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses.
Investing in small cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds. Investing in foreign securities, especially in emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus.
TOP 10 EQUITY HOLDINGS**
| | | | |
| Company | | % of Net
Assets | |
| |
| Euronet Worldwide, Inc. | | | 4.2% | |
| |
| HEICO Corp., Class A | | | 3.7% | |
| |
| Monro, Inc. | | | 2.9% | |
| |
| ICON plc(Ireland) | | | 2.8% | |
| |
| Zendesk, Inc. | | | 2.7% | |
| | | | |
| Company | | % of Net
Assets | |
| |
| Copart, Inc. | | | 2.6% | |
| |
| Ollie’s Bargain Outlet Holdings, Inc. | | | 2.6% | |
| |
| RBC Bearings, Inc. | | | 2.6% | |
| |
| Five Below, Inc. | | | 2.5% | |
| |
| Neogen Corp. | | | 2.4% | |
| ** | As of March 31, 2019, there were 66 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| †† | Also includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheRussell 2000 Growth Indexis an unmanaged total return index that measures the performance of those Russell 2000 Index companies with higher price-to-book ratios and higher forecasted growth values.The Russell 2000 Index is an unmanaged total return index of the smallest 2,000 companies in the Russell 3000 Index, as ranked by total market capitalization. The Russell 2000 Index is widely regarded in the industry as accurately capturing the universe of small company stocks.You cannot invest directly in these or any indexes.
27
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| WASATCH SMALL CAP VALUE FUND(WMCVX / WICVX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Small Cap Value Fund is managed by a team of Wasatch portfolio managers led by Jim Larkins.
| | |
Jim Larkins Lead Portfolio Manager | | OVERVIEW U.S equities rebounded from 2018’s poor finish to register one of their best quarters of the post-financial crisis era. Investors were encouraged by stabilizing domestic growth data, signs that the United States and China were working to resolve their trade dispute, and indications that the U.S. Federal Reserve was unlikely to raise interest rates again in 2019. These factors helped the benchmark Russell 2000 |
Value Index to gain 11.93%.
The Wasatch Small Cap Value Fund — Investor Class gained 11.67%, a return in line with that of the benchmark. We view this as a positive result given that we outperformed when the market posted a double-digit loss in the fourth quarter of 2018 — an indication that our stock-selection process may have helped to mitigate the downside and allowed the Fund to participate in the subsequent rally. We believe this favorable risk/return profile reflects our emphasis on higher-quality, fundamentally sound and financially strong companies.
DETAILSOFTHE QUARTER
The vast majority of the Fund’s holdings delivered positive returns in the first quarter. Several top contributors illustrate key elements of our strategy and process, including the role of patience in value investing. In many cases, it takes some time for an investment thesis to play out and there are often bumps along the way. However, we’ll generally stay invested in an underperforming holding as long as the fundamental story remains intact. An example is truckload company Knight-Swift Transportation Holdings, Inc.,which lagged in 2018 as the company worked to integrate a large acquisition. We thought the selloff in Knight-Swift’s shares was greatly exaggerated given the company’s history of strong execution. In the first quarter, management announced strong results and boosted its 2019 earnings outlook, and Knight-Swift’s stock regained most of the lost ground.
Another top contributor, Sleep Number Corp. provides an excellent example of our unique Fallen Angel discipline. “Fallen Angel” is the term we use to describe a high-quality company with an outstanding business model whose shares have descended into value territory due to short-term factors. In 2017, we built up a meaningful position in Sleep Number after a stretch of weakness on the belief that the company’s efforts to transform its mattress business were not fully reflected in its earnings. Investors have begun to take notice of the company’s fundamental changes. Sleep Number’s stock gained over 40% in the first quarter.
The Fund typically has low exposure to the materials and energy sectors. That’s because we would rather not allocate capital to companies whose fortunes are tied to commodity prices. When we do invest in these areas, we tend to favor
businesses that have more control over their own destinies. One such business is Innospec, Inc., a materials company with a suite of specialty chemicals that can perform independently of the generic “commodity cycle.” We invested in Innospec based on its good cash flow, multiple products and modest growth story. Innospec was one of the top contributors to Fund performance in the quarter.
Despite having many winners, the Fund gave back some ground through weakness in a handful of individual stocks. Among the largest detractors were Stamps.com, Inc., Atlas Financial Holdings, Inc. and Cimpress N.V. Stamps.com announced the end of an exclusive agreement with the U.S. Postal Service and the stock slumped. As portfolio managers, one of our most important tasks is to determine whether to keep an underperforming position, or whether fundamental deterioration indicates that a stock may have become a “value trap.” We chose to hold Stamps.com because we think the company may now be in a better position to take advantage of other growth opportunities. We also like its potential for international expansion and ability to capitalize on the growth ofe-commerce. With that said, we’re closely monitoring developments.
In contrast, we sold our position in Atlas Financial, a commercial auto insurer, because the company announced it would need to increase its reserves to cover previous losses.
U.S.-listed, Dutch-domiciled Cimpress, a “mass-market customization” printed-materials provider, reported surprisingly disappointing results across its business lines, owing in part to increasing competitive pressures. We reduced our position during the quarter in recognition of this risk, but our long experience with the company reminds us that Cimpress has overcome headwinds before. We’ll continue to monitor results.
OUTLOOKAND POSITIONING
Our portfolio activity was relatively light over the past three months, with the only notable changes involving shifts within the financials sector. We’ve been underweight in financials for quite some time, but recent volatility gave us the chance to compare our holdings with other opportunities. As part of this process, we sold three underperforming banks and one real estate investment trust, as we believe these companies may continue to face headwinds. We redeployed some of the sales proceeds into financial companies that we believe have better long-term prospects.
From a broader standpoint, we view the volatility of the past six months as a positive development since rapid market movements often create a wider range of opportunities for us to put our Fallen Angel strategy to work. We believe our focus on high-quality companies with recurring revenues, deeply entrenched customer bases, and limited competition continues to provide the foundation for competitive performance in both up and down markets.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
28
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| WASATCH SMALL CAP VALUE FUND (WMCVX / WICVX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
Small Cap Value (WMCVX) — Investor | | | | -5.76% | | | | | 3.46% | | | | | 8.21% | | | | | 17.35% | |
Small Cap Value (WICVX) — Institutional | | | | -5.72% | | | | | 3.57% | | | | | 8.31% | | | | | 17.47% | |
Russell 2000® Value Index | | | | -8.97% | | | | | 0.17% | | | | | 5.59% | | | | | 14.12% | |
Russell 2000® Index | | | | -8.56% | | | | | 2.05% | | | | | 7.05% | | | | | 15.36% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Small Cap Value Fund are Investor Class: 1.20% / Institutional Class — Gross: 1.13%, Net: 1.06%. The expense ratio shown elsewhere in this report may be different. Net expenses are based on Fund expenses, net of waivers and reimbursements. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Performance for the Institutional Class prior to 1/31/2012 is based on the performance of the Investor Class. Performance of the Fund’s Institutional Class prior to 1/31/2012 uses the actual expenses of the Fund’s Investor Class without any adjustments. For any such period of time, the performance of the Fund’s Institutional Class would have been substantially similar to, yet higher than, the performance of the Fund’s Investor Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses.
Investing in small cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds. Investments in value stocks can perform differently from the market as a whole and from other types of stocks and can continue to be undervalued by the market for long periods of time. Investing in foreign securities, especially in emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus.
TOP 10 EQUITY HOLDINGS**
| | | | |
| Company | | % of Net
Assets | |
| |
| Euronet Worldwide, Inc. | | | 4.7% | |
| |
| Monro, Inc. | | | 3.9% | |
| |
| Knight-Swift Transportation Holdings, Inc. | | | 3.7% | |
| |
| Kadant, Inc. | | | 3.7% | |
| |
| Dorman Products, Inc. | | | 3.7% | |
| | | | |
| Company | | % of Net
Assets | |
| |
| Ensign Group, Inc. (The) | | | 3.3% | |
| |
| Innospec, Inc. | | | 3.1% | |
| |
| Arbor Realty Trust, Inc. | | | 2.7% | |
| |
| Lithia Motors, Inc., Class A | | | 2.6% | |
| |
| Altra Industrial Motion Corp. | | | 2.6% | |
| ** | As of March 31, 2019, there were 49 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| †† | Also includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheRussell 2000 Value Index measures the performance of those Russell 2000 Index companies with lower price-to-book ratios and lower forecasted growth values. TheRussell 2000 Index is an unmanaged total return index of the smallest 2,000 companies in the Russell 3000 Index, as ranked by total market capitalization. The Russell 2000 Index is widely regarded in the industry as accurately capturing the universe of small company stocks.You cannot invest directly in these or any indexes.
29
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| WASATCH ULTRA GROWTH FUND(WAMCX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
The Wasatch Ultra Growth Fund is managed by a team of Wasatch portfolio managers led by John Malooly.
| | |
John Malooly, CFA Lead Portfolio Manager | | OVERVIEW The Wasatch Ultra Growth Fund gained 18.90% during the first quarter of 2019 and outpaced its benchmark, the Russell 2000 Growth Index, which rose 17.14%. Equity prices moved higher amid signs of easier U.S. monetary policy and hopes for a speedy resolution to the U.S.-China trade dispute. On the economic front, data released during the quarter showed a slowing U.S. economy leading Federal Reserve |
officials to signal no interest-rate hikes this year.
Asbottom-up investors, we don’t make macroeconomic or political forecasts. Instead, we take events and data as they come, factoring them into our assessments of individual companies and industry exposures. We continually reassess the near-term risks and earnings profiles of our companies as they relate to macro issues such as their trade exposure to China. Generally speaking, corporate earnings face more difficult year-over-year comparisons in 2019 after benefiting from a tax cut last year.
With the economic outlook appearing more uncertain, growth stocks outperformed value stocks during the first quarter. A mainstay for growth investors, information-technology (IT) led the advance in equities. The Fund’s IT stocks outgained the IT positions in the benchmark, and our overweight position was a tailwind to performance. Consumer discretionary was another source of strength relative to the benchmark driven by the strong performance of our holdings across the sector and outsized gains in a few individual holdings.
DETAILSOFTHE QUARTER
The strongest contributor to Fund performance for the first quarter was Paylocity Holding Corp. The company provides software for payroll and human-capital management using theSoftware-as-a-Service business model. Paylocity saw its stock price rise after a competitor agreed to be acquired at a premium by a private investor group. Incidentally, we also owned the competitor that was acquired — Ultimate Software Group, Inc.We think Paylocity stands to benefit as Ultimate adjusts to the influences of its new owners. For Paylocity, better-than-expected revenues, earnings and forward guidance also helped push its stock higher during the quarter.
Tandem Diabetes Care, Inc.was the second-best contributor. The company offers insulin-delivery systems for people with diabetes. Shares of Tandem jumped in February on better-than-expected quarterly results and strong guidance for 2019. Total pump shipments surged 133% versus theyear-ago quarter, sending revenues 89% higher and pushing earnings into the black sooner than analysts had been expecting.
The greatest detractor from Fund performance for the quarter was Metro Bank plc. One of theso-called challenger banks established in the U.K. after the financial crisis, Metro
is noted for outstanding customer experience. In January, the bank disclosed that it had applied an incorrectly low risk weighting to parts of its loan book. In February, Metro revealed that it would have to raise additional equity in order to put more capital behind the misclassified loans. The bank now faces the prospect of having to issue stock at prices that are highly dilutive to the ownership stakes of existing shareholders. Events at Metro Bank have raised concerns about the bank’s internal controls — and management’s shifting account as to how the errors were discovered hasn’t soothed investors. We continue to hold the stock at a low weight but are watching developments closely.
The Fund’s second-largest detractor was Sangamo Therapeutics, Inc.A clinical-stage biopharmaceutical company, Sangamo specializes in the treatment and cure of single-gene disorders. Investors reacted negatively in February to interim results from an early-stage study using the company’szinc-finger gene-editing technology for the treatment of Hurler syndrome. However, we think it’s too early to draw conclusions until results from the study’s high-dose subjects have been released.
Healthcare Services Group, Inc.(HCSG) was also a significant detractor. HCSG provides outsourced housekeeping and nutritional services for hospitals, nursing homes and other health-care institutions. HCSG shares fell sharply in early March after the company disclosed that it would file its 201810-K report 15 days late. Management revealed the company had received a letter from the Securities and Exchange Commission in November 2017 seeking information about the way HCSG calculates and reports its earnings per share. The company also disclosed it received a subpoena from the commission concerning the matter in March 2018. With little else to go on, investors assumed the worst and sold the stock. We continue to monitor the situation for further developments.
OUTLOOK
One of the main principles behind the Wasatch investment approach is the thesis that in the long run, earnings drive stock prices. Simply put, we believe companies that can compound their earnings at favorable rates over time will generate attractive long-term investment returns. Even so, fluctuations in expectations can have an outsized impact over shorter periods. We think the currently high levels of uncertainty provide good reason for investors to be cautious.
Regardless of the near-term outlook, our disciplined investment approach keeps us squarely focused on the growth prospects of individual businesses over long periods of time. We look for dynamic, innovative companies that can take market share and grow even in unfavorable economic environments. Interestingly, those types of companies tend to be the ones investors seek most during an economic downturn. While the current investment environment demands modest expectations for short-term returns, we believe our investment approach retains its appeal over appropriately longer horizons.
Thank you for the opportunity to manage your assets.
| | Current and future holdings are subject to risk. |
30
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| WASATCH ULTRA GROWTH FUND(WAMCX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
Ultra Growth | | | | -2.60% | | | | | 23.17% | | | | | 13.92% | | | | | 19.96% | |
Russell 2000® Growth Index | | | | -8.22% | | | | | 3.85% | | | | | 8.41% | | | | | 16.52% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch Ultra Growth Fund are 1.25%. The expense ratio shown elsewhere in this report may be different. Expenses include direct expenses paid to the Advisor as well as indirect expenses incurred by the Fund as a result of its investments in other investment companies (each an “Acquired Fund”), before any expense reimbursements by the Advisor. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Investing in small cap funds will be more volatile and loss of principal could be greater than investing in large cap or more diversified funds. Investing in foreign securities, especially in emerging markets, entails special risks, such as currency fluctuations and political uncertainties, which are described in more detail in the prospectus.
TOP 10 EQUITY HOLDINGS**
| | | | |
| Company | | % of Net
Assets | |
| |
| Paylocity Holding Corp. | | | 2.8% | |
| |
| Trex Co., Inc. | | | 2.4% | |
| |
| Zendesk, Inc. | | | 2.2% | |
| |
| Freshpet, Inc. | | | 2.2% | |
| |
| Knight-Swift Transportation Holdings, Inc. | | | 2.1% | |
| | | | |
| Company | | % of Net
Assets | |
| |
| InterXion Holding N.V.(Netherlands) | | | 2.0% | |
| |
| Kornit Digital Ltd.(Israel) | | | 1.9% | |
| |
| Proto Labs, Inc. | | | 1.9% | |
| |
| Five Below, Inc. | | | 1.9% | |
| |
| Tandem Diabetes Care, Inc. | | | 1.9% | |
| ** | As of March 31, 2019, there were 82 holdings in the Fund. Foreign currency contracts, written options and repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
SECTOR BREAKDOWN†
| † | Excludes securities sold short and options written, if any. |
| †† | Also includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheRussell 2000 Growth Indexis an unmanaged total return index that measures the performance of those Russell 2000 Index companies with higher price-to-book ratios and higher forecasted growth values. The Russell 2000 Index is an unmanaged total return index of the smallest 2,000 companies in the Russell 3000 Index, as ranked by total market capitalization.You cannot investdirectly in these or any indexes.
31
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| WASATCH-HOISINGTON U.S. TREASURY FUND(WHOSX) | | MARCH 31, 2019 (UNAUDITED) |
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Management Discussion
| | | | |
Van Hoisington Lead Portfolio Manager | | 
Van R. Hoisington, Jr. Portfolio Manager | | 
David Hoisington Portfolio Manager |
OVERVIEW
U.S. Treasury bond yields decreased in the first calendar quarter of 2019 after increasing for much of 2018. The30-year Treasury bond yield declined to 2.81% down from 3.02% at the end of 2018. Fiscal-policy actions, which stimulated gross domestic product (GDP) growth early last year, proved to be fleeting. By late 2018, that stimulus was almost impossible to detect in the broad economic aggregates.
DETAILSOFTHE PERIOD
For the three months ended March 31, 2019, the Wasatch-Hoisington U.S. Treasury Fund gained 5.37%, while the benchmark Bloomberg Barclays US Aggregate Bond Index only rose 2.94%. For the12-months ended March 31, 2019, the Fund gained 5.85%, outperforming the Index, which increased 4.48%.
OUTLOOKFORTHE YEAR
The slowdown in U.S. economic activity that started in 2018 has continued into 2019, as confirmed by deteriorating indicators in cyclical bellwether sectors — autos, housing and capital spending — and broad economic aggregates. This has been acknowledged by the Federal Open Market Committee (FOMC) and recognized in the market, as revealed by declining yields in high-grade money and bond markets. These developments reflect the unfolding of two major economic theorems. First, federal-debt accelerations ultimately lead to lower, not higher, interest rates. Debt-funded traditional fiscal stimulus is extremely fleeting when debt levels are already inordinately high. Thus, additional and large deficits provide only transitory gains in economic activity, which are quickly followed by weaker business conditions. With slower economic growth and inflation, long-term rates inevitably fall. Second, monetary decelerations eventually lead to lower, not higher, interest rates as originally theorized by economist Milton Friedman.
In the past 20 years, gross government debt as a percentage of GDP advanced dramatically in all major economic areas of the world, yet long-term government bond yields dropped sharply in these areas. This result contradicts the view that the supply of government debt determines long-term risk-free yields. In microeconomic models and standard supply/demand analysis, increasing the issuance of debt could push yields higher. Quite possibly in the short run, heavy issuance
of government debt has this presumed effect, but it is not the ultimate determinant of long-term risk-free rates.
The Fisher equation (i=r+pe) defines the long-term risk-free rate as being equal to the real rate plus expected inflation. This means that anyshort-run increase in yields caused by greater supply is eventually reversed by deteriorating economic and inflation fundamentals. Undoubtedly, government debt will rise sharply relative to GDP over the next several years. This increased debt level will weaken economic activity, thus inflation, pushing long-term yields lower, thereby continuing the now almost three-decade-long trend toward lower long-term Treasury yields.
Irving Fisher’s equation of exchange (M2*V=GDP) states that money times its turnover (velocity) is equal to nominal GDP. The Federal Reserve (Fed) has virtually no control over the velocity of money, but it can influence the monetary and credit aggregates. The Fed’s actions over the past four years fit a pattern that has many precedents in economic history. The reserve aggregates, such as the monetary base and excess reserves, peaked in the summer of 2014. The federal-funds rate has been raised nine times since December 2015. The year-over-year growth in M2 and bank credit peaked in October 2016 and then decelerated sharply thereafter. Meanwhile, the velocity of money fell sharply. Also, symptomatic of the monetary restraint, the yield curve flattened dramatically, with parts of the curve inverting. Moreover, the fall in the monetary base resulted in an unprecedented contraction in world dollar liquidity that led to monetary decelerations in Europe, Japan and China and from there to a synchronized global economic slowdown.
The Fed appears to have a high sensitivity to coincident or contemporaneous indicators of economic activity, however, the economic variables (i.e., money and interest rates) over which it has influence are slow moving and have enormous lags. In the most recent episode, in the last half of 2018, the Fed raised interest rates twice in reaction to strongmid-year GDP numbers. These actions were taken despite the fact that the results of the Fed’s previous rate hikes and monetary deceleration were beginning to show that they were actually slowing economic growth. It appears that history is being repeated — too tight for too long, slower growth, lower rates.
As a result of these considerations, we conclude that the Fund’s investments in long-term U.S. Treasury securities are appropriate.
Thank you for the opportunity to manage your assets.
32
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| WASATCH-HOISINGTON U.S. TREASURY FUND (WHOSX) | | MARCH 31, 2019 (UNAUDITED) |
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Portfolio Summary
AVERAGE ANNUAL TOTAL RETURNS
| | | | | | | | | | | | | | | | | | | | |
| | | SIX MONTHS* | | 1 YEAR | | 5 YEARS | | 10 YEARS |
U.S. Treasury | | | | 9.75% | | | | | 5.85% | | | | | 5.85% | | | | | 5.11% | |
Bloomberg Barclays US Aggregate Bond Index | | | | 4.63% | | | | | 4.48% | | | | | 2.74% | | | | | 3.77% | |
Data shows past performance, which is not indicative of future performance. Current performance may be lower or higher than the performance quoted. To obtain the most recent month-end performance data available, please visit www.WasatchFunds.com. The Advisor may absorb certain Fund expenses, without which total return would have been lower. Investment returns and principal value will fluctuate and shares, when redeemed, may be worth more or less than their original cost.
As of the January 31, 2019 prospectus, the Total Annual Fund Operating Expenses for the Wasatch-Hoisington U.S. Treasury Fund are 0.70%.The expense ratio shown elsewhere in this report may be different. See the prospectus for additional information regarding Fund expenses.
Wasatch Funds will deduct a 2.00% redemption proceeds fee on Fund shares held 60 days or less. Performance data does not reflect the deduction of fees, including sales charges, or the taxes you would pay on fund distributions or the redemption of fund shares. Fees and taxes, if reflected, would reduce the performance quoted. Wasatch does not charge any sales fees. For more complete information including charges, risks and expenses, read the prospectus carefully.
Investments in fixed income funds are subject to the same interest rate, inflation, credit and other risks associated with the underlying bonds. Return of principal is not guaranteed.
TOP U.S. TREASURY HOLDINGS**
| | | | | | | | |
| Holding | | Maturity
Date | | | % of Net
Assets | |
| | |
| U.S. Treasury Bond, 2.250% | | | 8/15/46 | | | | 30.5% | |
| | |
| U.S. Treasury Strip, principal only | | | 8/15/45 | | | | 25.3% | |
| | |
| U.S. Treasury Bond, 3.000% | | | 8/15/48 | | | | 15.2% | |
| | |
| U.S. Treasury Strip, principal only | | | 5/15/44 | | | | 12.1% | |
| | | | | | | | |
| Holding | | Maturity
Date | | | % of Net
Assets | |
| | |
| U.S. Treasury Strip, principal only | | | 8/15/40 | | | | 6.6% | |
| | |
| U.S. Treasury Bond, 2.500% | | | 2/15/45 | | | | 5.2% | |
| | |
| U.S. Treasury Bond, 3.750% | | | 11/15/43 | | | | 3.9% | |
| | |
| U.S. Treasury Bond, 3.125% | | | 8/15/44 | | | | 0.9% | |
| ** | As of March 31, 2019, there were 8 holdings in the Fund. Repurchase agreements, if any, are not included in the number of holdings. Portfolio holdings are subject to change at any time. References to specific securities should not be construed as recommendations by the Funds or their Advisor. Current and future holdings are subject to risk. |
INVESTMENTS & CASH
| † | Also includes Other Assets & Liabilities. |
GROWTHOFA HYPOTHETICAL $10,000 INVESTMENT
Past performance does not predict future performance. The graph above does not reflect the deduction of fees, sales charges, or taxes that you would pay on fund distributions or the redemption of fund shares. Wasatch does not charge any sales fees. TheBloomberg Barclays US Aggregate Bond Indexis a broadbased flagship benchmark that measures the investment grade, US dollar denominated, fixed-rate taxable bond market. The index includes Treasuries, government-related and corporate securities, MBS (agency fixed-rate and hybrid ARM pass-throughs), ABS and CMBS (agency and non-agency).You cannot investdirectly in this or any index.
33
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| WASATCH FUNDS MANAGEMENT DISCUSSIONS | | |
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Definitions of Financial Terms
Brexit is an abbreviation for “British exit,” which refers to the June 23, 2016 referendum whereby British citizens voted to exit the European Union. The referendum roiled global markets, including currencies, causing the British pound to fall to its lowest level in decades.
ChinaA-shares, along withB-shares, are sold on mainland China’s two stock exchanges, which are in Shanghai and Shenzhen. The key difference betweenA-shares andB-shares is thatA-shares are denominated in mainland China’s currency, the renminbi, andB-shares are denominated in foreign currency (U.S. dollars in Shanghai and Hong Kong dollars in Shenzhen).
The “cloud” is the internet.Cloud-computing is a model for delivering information-technology services in which resources are retrieved from the internet throughweb-based tools and applications, rather than from a direct connection to a server.
TheU.S. Consumer Price Index (CPI), also called thecost-of-living index, is an inflationary indicator that measures the change in the cost of a fixed basket of products and services, including housing, electricity, food, and transportation. The CPI is published monthly. The headline CPI includes volatile food and energy prices, while the core CPI excludes food and energy.
Acredit aggregate measures the stock of bank loans outstanding at a point in time.
Earnings growth is a measure of growth in a company’s net income over a specific period, often one year.
Earnings per share or EPS is the portion of a company’s profit allocated to each outstanding share of common stock. EPS growth rates help investors identify companies that are increasing or decreasing in profitability.
Thefederal-funds rate is the interest rate at which private depository institutions (mostly banks) lend balances (federal funds) at the Federal Reserve to other depository institutions, usually overnight. It is the interest rate banks charge each other for loans.
TheFederal Open Market Committee (FOMC), a component of the Federal Reserve System, is charged under United States law with overseeing the nation’s open market operations. Open market operations are the means of implementing monetary policy by which a central bank controls the short-term interest rate and the supply of base money in an economy, and thus indirectly the total money supply.
Theglobal financial crisis, also known as the financial crisis of2007-09 and 2008 financial crisis, is considered by many economists to have been the worst financial crisis since the Great Depression of the 1930s.
Gross domestic product (GDP) is a basic measure of a country’s economic performance and is the market value of all final goods and services made within the borders of a country in a year.
M2money supply consists of currency and checking accounts, consumer-type time and savings accounts and equivalent near monies, while M3 money supply consists of M2 plus business-type time deposits and less liquid near monies. Both M2 and M3 exclude monies and near monies owned by the Treasury, depository institutions and foreign banks and official institutions and IRA and Keogh balances owned by consumers.
Amonetary aggregate measures the stock of money outstanding within an economy at a point in time.
Themonetary base is the total amount of a currency that is either circulated in the hands of the public or in the commercial bank deposits held in the central bank’s reserves. This measure of the money supply typically only includes the most liquid currencies.
OPEC is an acronym for the Organization of Petroleum Exporting Countries. OPEC was founded in 1960. It is a collective of countries that export large amounts of petroleum and was formed to establishoil-exporting policies and set prices.
Real gross domestic product (GDP) is a macroeconomic measure of the value of economic output adjusted for price changes (i.e., inflation or deflation). This adjustment transforms the money-value measure, nominal GDP, into an index for quantity of total output.
Return on equity (ROE) measures a company’s efficiency at generating profits from shareholders’ equity.
TheShanghai Stock Exchange is the largest stock exchange in mainland China. It is anon-profit organization run by the China Securities Regulatory Commission (CSRC).
TheShenzhen Stock Exchange, based in Shenzhen, Guangdong, is one of China’s three stock exchanges. The other two are the Shanghai Stock Exchange and the Hong Kong Stock Exchange.
Valuation is the process of determining the current worth of an asset or company.
Thevelocity of money (V) is defined as the rate at which money circulates, changes hands or turns over in an economy.
Theyield curve is a line on a graph that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity dates. The most frequently reported yield curve compares three-month,two-year, five-year and30-year U.S. Treasury securities. This yield curve is used as a benchmark for other interest rates, such as mortgage rates or bank lending rates. The curve is also used to predict changes in economic output and growth.
INDEX DESCRIPTIONSAND DISCLOSURES
TheBloomberg Barclays US Aggregate Bond Index is a broad-based flagship benchmark that measures the investment grade, US dollar denominated, fixed-rate taxable bond market. The index includes Treasuries, government-related and corporate securities, mortgage-backed securities (MBS) (agency fixed-rate and hybrid adjustable-rate mortgage [ARM] pass-throughs), asset-backed securities (ABS) and commercial mortgage-backed securities (CMBS) (agency andnon-agency).
TheBloomberg Barclays US 20+ Year Treasury Bond Index measures the performance of U.S. Treasury securities that have remaining maturities of 20 or more years.
TheMSCI EAFE Index is an equity index that captures large- andmid-cap representation across 21 developed-market countries around the world, excluding the United States and Canada. With 920 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.
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| | MARCH 31, 2019 (UNAUDITED) |
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TheMSCI Emerging Markets Index captures large- and mid-cap representation across 24 emerging market countries. With 1,136 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.
TheMSCI World ex USA Index captures large- and mid-cap representation across 22 of 23 developed market countries—excluding the United States. With 1,012 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.
Pertaining to the use of MSCI information. Source: MSCI. The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis should not be taken as an indication or guarantee of any future performance analysis, forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI Parties”) expressly disclaims all warranties (including, without limitation, any warranties or originality, accuracy, completeness, timeliness,non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages. (www.msci.com)
Launched in 1971, theNasdaq Composite Index is a market-capitalization weighted index of the more than 3,000 securities listed on The Nasdaq Stock Market. The types of
securities in the index include American depositary receipts, common stocks, limited partnership interests, ordinary shares, real estate investment trusts (REITs), shares of beneficial interest (SBIs) and tracking stocks.
TheRussell 2000 Index is an unmanaged total-return index of the smallest 2,000 companies in the Russell 3000 Index, as ranked by total market capitalization. The Russell 2000 is widely used in the industry to measure the performance of small-company stocks.
TheRussell 2000 Growth Index measures the performance of Russell 2000 Index companies with higherprice-to-book ratios and higher forecasted growth values.
TheRussell 2000 Value Index measures the performance of Russell 2000 Index companies with lowerprice-to-book ratios and lower forecasted growth values.
Pertaining to the use of Russell information. All rights in the Russell 2000, Russell 2000 Growth and Russell 2000 Value vest in the relevant London Stock Exchange Group plc (collectively, the “LSE Group”), which owns these indexes. Russell® is a trademark of the relevant LSE Group company and is used by any other LSE Group company under license. These indexes are calculated by or on behalf of FTSE International Limited or its affiliate, agent or partner. The LSE Group does not accept any liability whatsoever to any person arising out of (a) the use of, reliance on or any error in the Index or (b) investment in or operation of any Wasatch portfolio. The LSE Group makes no claim, prediction, warranty or representation either as to the results to be obtained from any Wasatch portfolio or the suitability of these indexes for the purpose to which they are being put by Wasatch Advisors, Inc.
TheS&P 500 Index includes 500 of the United States’ largest stocks from a broad variety of industries. The Index is unmanaged but is a commonly used measure of common stock total return performance.
You cannot invest directly in these or any indexes.
35
Operating Expenses(UNAUDITED)
EXPENSE EXAMPLE
As a shareholder of Wasatch Funds, you incur two types of costs: (1) transaction costs, including redemption fees and (2) ongoing costs, including management fees and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in a Wasatch Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The example is based on an investment of $1,000.00 invested at the beginning of the period and held for the entire six-month period ended March 31, 2019.
ACTUAL EXPENSES
The first line of the table on the next page provides information about actual account values and actual expenses, based upon the actual total return of the fund during the most recent six-month period ended March 31, 2019. You may use the information in this line, together with the amount you invested, to estimate the expenses you paid over the period. Simply divide your account value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
In addition, the Funds charge a $12.50 IRA annual maintenance fee and a $15.00 fee for redemptions paid by wire. To the extent these fees apply to your account, your expenses paid during the period would be higher and your ending account value would be lower than the amounts shown in the table on the next page.
HYPOTHETICAL EXAMPLEFOR COMPARISON PURPOSES
The second line of the table on the next page provides information about hypothetical account values and hypothetical expenses based on a 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 expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in a Wasatch Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.
In addition, the Funds charge a $12.50 IRA annual maintenance fee and a $15.00 fee for redemptions paid by wire. To the extent these fees apply to your account, your expenses paid during the period would be higher and your ending account value would be lower than the amounts shown in the table on the next page. If another fund’s fees differ from those listed above, your expenses paid and your ending account value could be higher or lower than those of other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
A Fund’s annualized expense ratio may vary as a result of various factors including expenses that are not reimbursable under the contractual agreement between the Fund and the Advisor such as interest, taxes, brokerage commissions, other investment related costs, dividend expense on short sales, and extraordinary expenses.
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| | MARCH 31, 2019 (UNAUDITED) |
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| | | Account Value | | Expenses Paid
During Period* | | Annualized Expense
Ratio* |
| Fund/Class and Return | | Beginning of Period
October 1, 2018 | | End of Period
March 31, 2019 |
Core Growth Fund — Investor Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $938.20 | | | | | $5.75 | | | | | 1.19% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,019.00 | | | | | $5.99 | | | | | 1.19% | |
Core Growth Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $938.90 | | | | | $5.08 | | | | | 1.05% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,019.70 | | | | | $5.29 | | | | | 1.05% | |
Emerging India Fund — Investor Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $1,126.20 | | | | | $9.12 | | | | | 1.72% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,016.36 | | | | | $8.65 | | | | | 1.72% | |
Emerging India Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $1,128.10 | | | | | $8.01 | | | | | 1.51% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,017.40 | | | | | $7.59 | | | | | 1.51% | |
Emerging Markets Select Fund — Investor Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $1,063.50 | | | | | $7.77 | | | | | 1.51% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,017.40 | | | | | $7.59 | | | | | 1.51% | |
Emerging Markets Select Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $1,065.30 | | | | | $6.23 | | | | | 1.21% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,018.90 | | | | | $6.09 | | | | | 1.21% | |
Emerging Markets Small Cap Fund — Investor Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $1,036.30 | | | | | $10.00 | | | | | 1.97% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,015.11 | | | | | $9.90 | | | | | 1.97% | |
Emerging Markets Small Cap Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $1,040.10 | | | | | $9.26 | | | | | 1.82% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,015.86 | | | | | $9.15 | | | | | 1.82% | |
Frontier Emerging Small Countries Fund — Investor Class | | | | | | | | | | | | | | | | | | | | |
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Actual | | | | $1,000.00 | | | | | $1,039.80 | | | | | $11.44 | | | | | 2.25% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,013.71 | | | | | $11.30 | | | | | 2.25% | |
Frontier Emerging Small Countries Fund —
Institutional Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $1,039.50 | | | | | $10.42 | | | | | 2.05% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,014.71 | | | | | $10.30 | | | | | 2.05% | |
Global Opportunities Fund — Investor Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $973.20 | | | | | $7.72 | | | | | 1.57% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,017.10 | | | | | $7.90 | | | | | 1.57% | |
Global Opportunities Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $973.20 | | | | | $6.69 | | | | | 1.36% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,018.15 | | | | | $6.84 | | | | | 1.36% | |
Global Value Fund — Investor Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $982.00 | | | | | $5.44 | | | | | 1.10% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,019.45 | | | | | $5.54 | | | | | 1.10% | |
Global Value Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $982.80 | | | | | $4.70 | | | | | 0.95% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,020.20 | | | | | $4.78 | | | | | 0.95% | |
International Growth Fund — Investor Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $893.10 | | | | | $6.94 | | | | | 1.47% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,017.60 | | | | | $7.39 | | | | | 1.47% | |
International Growth Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $893.70 | | | | | $6.42 | | | | | 1.36% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,018.15 | | | | | $6.84 | | | | | 1.36% | |
International Opportunities Fund — Investor Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $941.50 | | | | | $10.70 | | | | | 2.21% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,013.91 | | | | | $11.10 | | | | | 2.21% | |
International Opportunities Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $942.10 | | | | | $9.54 | | | | | 1.97% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,015.11 | | | | | $9.90 | | | | | 1.97% | |
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| WASATCH FUNDS | | MARCH 31, 2019 (UNAUDITED) |
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Operating Expenses(continued)
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| | | Account Value | | Expenses Paid
During Period* | | Annualized Expense
Ratio* |
| Fund/Class and Return | | Beginning of Period
October 1, 2018 | | End of Period
March 31, 2019 |
Micro Cap Fund | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $944.70 | | | | | $8.10 | | | | | 1.67% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,016.60 | | | | | $8.40 | | | | | 1.67% | |
Micro Cap Value Fund | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $931.20 | | | | | $8.43 | | | | | 1.75% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,016.21 | | | | | $8.80 | | | | | 1.75% | |
Small Cap Growth Fund — Investor Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $977.80 | | | | | $5.87 | | | | | 1.19% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,019.00 | | | | | $5.99 | | | | | 1.19% | |
Small Cap Growth Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $978.60 | | | | | $5.23 | | | | | 1.06% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,019.65 | | | | | $5.34 | | | | | 1.06% | |
Small Cap Value Fund — Investor Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $942.40 | | | | | $5.81 | | | | | 1.20% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,018.95 | | | | | $6.04 | | | | | 1.20% | |
Small Cap Value Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $942.80 | | | | | $5.09 | | | | | 1.05% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,019.70 | | | | | $5.29 | | | | | 1.05% | |
Ultra Growth Fund | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $974.00 | | | | | $5.91 | | | | | 1.20% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,018.95 | | | | | $6.04 | | | | | 1.20% | |
U.S. Treasury Fund | | | | | | | | | | | | | | | | | | | | |
| | | | |
Actual | | | | $1,000.00 | | | | | $1,097.50 | | | | | $3.71 | | | | | 0.71% | |
Hypothetical (5% before expenses) | | | | $1,000.00 | | | | | $1,021.39 | | | | | $3.58 | | | | | 0.71% | |
*Expenses are equal to a fund’s annualized expense ratio as indicated above multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half-year divided by the number of days in the full fiscal year (182/365).
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| WASATCH CORE GROWTH FUND(WGROX / WIGRX) | | MARCH 31, 2019 (UNAUDITED) |
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Schedule of Investments
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| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 98.6% | | | | |
| | |
| | | | Airlines 0.9% | | | | |
| | 157,762 | | | Allegiant Travel Co. | | $ | 20,425,446 | |
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| | | | Application Software 14.8% | | | | |
| | 570,798 | | | Altair Engineering, Inc., Class A* | | | 21,011,075 | |
| | 415,018 | | | DocuSign, Inc.* | | | 21,514,533 | |
| | 651,048 | | | Envestnet, Inc.* | | | 42,572,029 | |
| | 595,651 | | | Five9, Inc.* | | | 31,468,242 | |
| | 612,096 | | | Guidewire Software, Inc.* | | | 59,471,247 | |
| | 552,749 | | | Paylocity Holding Corp.* | | | 49,299,683 | |
| | 565,776 | | | Q2 Holdings, Inc.* | | | 39,185,646 | |
| | 275,738 | | | Tyler Technologies, Inc.* | | | 56,360,847 | |
| | | | | | | | |
| | | | | | | 320,883,302 | |
| | | | | | | | |
| | |
| | | | Asset Management & Custody Banks 1.7% | | | | |
| | 850,123 | | | Hamilton Lane, Inc., Class A | | | 37,048,360 | |
| | | | | | | | |
| | |
| | | | Automotive Retail 4.3% | | | | |
| | 1,372,067 | | | Camping World Holdings, Inc., Class A | | | 19,085,452 | |
| | 843,509 | | | Monro, Inc. | | | 72,980,399 | |
| | | | | | | | |
| | | | | | | 92,065,851 | |
| | | | | | | | |
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| | | | Biotechnology 1.8% | | | | |
| | 1,889,430 | | | Abcam plc (United Kingdom) | | | 27,931,073 | |
| | 1,202,934 | | | Sangamo Therapeutics, Inc.* | | | 11,475,990 | |
| | | | | | | | |
| | | | | | | 39,407,063 | |
| | | | | | | | |
| | |
| | | | Building Products 2.8% | | | | |
| | 977,473 | | | Trex Co., Inc.* | | | 60,134,139 | |
| | | | | | | | |
| | |
| | | | Commercial Printing 1.2% | | | | |
| | 325,217 | | | Cimpress N.V.* | | | 26,059,638 | |
| | | | | | | | |
| | |
| | | | Commodity Chemicals 1.4% | | | | |
| | 1,671,408 | | | Valvoline, Inc. | | | 31,021,333 | |
| | | | | | | | |
| | |
| | | | Consumer Finance 2.3% | | | | |
| | 111,090 | | | Credit Acceptance Corp.* | | | 50,204,904 | |
| | | | | | | | |
| | |
| | | | Data Processing & Outsourced Services 4.2% | | | | |
| | 636,472 | | | Euronet Worldwide, Inc.* | | | 90,754,543 | |
| | | | | | | | |
| | |
| | | | Distributors 3.2% | | | | |
| | 413,621 | | | Pool Corp. | | | 68,235,056 | |
| | | | | | | | |
| | |
| | | | Diversified Banks 1.3% | | | | |
| | 9,378,173 | | | City Union Bank Ltd. (India) | | | 27,684,394 | |
| | | | | | | | |
| | |
| | | | Diversified Support Services 4.2% | | | | |
| | 1,036,527 | | | Copart, Inc.* | | | 62,803,171 | |
| | 861,028 | | | Healthcare Services Group, Inc. | | | 28,405,314 | |
| | | | | | | | |
| | | | | | | 91,208,485 | |
| | | | | | | | |
| | |
| | | | General Merchandise Stores 2.3% | | | | |
| | 594,016 | | | Ollie’s Bargain Outlet Holdings, Inc.* | | | 50,687,385 | |
| | | | | | | | |
| | |
| | | | Health Care Equipment 1.8% | | | | |
| | 582,223 | | | Cantel Medical Corp. | | | 38,944,896 | |
| | | | | | | | |
| | |
| | | | Health Care Facilities 2.1% | | | | |
| | 877,503 | | | Ensign Group, Inc. (The) | | | 44,919,379 | |
| | | | | | | | |
| | |
| | | | Health Care Supplies 2.0% | | | | |
| | 743,693 | | | Neogen Corp.* | | | 42,680,541 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Home Improvement Retail 1.2% | | | | |
| | 605,897 | | | Floor & Decor Holdings, Inc., Class A* | | $ | 24,975,074 | |
| | | | | | | | |
| | |
| | | | Industrial Machinery 9.8% | | | | |
| | 1,159,177 | | | Altra Industrial Motion Corp. | | | 35,992,446 | |
| | 935,088 | | | Barnes Group, Inc. | | | 48,072,874 | |
| | 400,716 | | | Kadant, Inc. | | | 35,246,979 | |
| | 424,962 | | | RBC Bearings, Inc.* | | | 54,042,418 | |
| | 855,167 | | | Sun Hydraulics Corp. | | | 39,773,817 | |
| | | | | | | | |
| | | | | | | 213,128,534 | |
| | | | | | | | |
| | |
| | | | Industrial REITs 2.1% | | | | |
| | 3,522,940 | | | Monmouth Real Estate Investment Corp. | | | 46,432,349 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 1.1% | | | | |
| | 160,794 | | | Wayfair, Inc., Class A* | | | 23,869,869 | |
| | | | | | | | |
| | |
| | | | IT Consulting & Other Services 4.4% | | | | |
| | 340,521 | | | EPAM Systems, Inc.* | | | 57,592,317 | |
| | 579,785 | | | InterXion Holding N.V.* (Netherlands) | | | 38,689,053 | |
| | | | | | | | |
| | | | | | | 96,281,370 | |
| | | | | | | | |
| | |
| | | | Leisure Facilities 1.3% | | | | |
| | 419,085 | | | Planet Fitness, Inc., Class A* | | | 28,799,521 | |
| | | | | | | | |
| | |
| | | | Life Sciences Tools & Services 3.9% | | | | |
| | 448,477 | | | ICON plc* (Ireland) | | | 61,252,989 | |
| | 394,860 | | | Medpace Holdings, Inc.* | | | 23,284,894 | |
| | | | | | | | |
| | | | | | | 84,537,883 | |
| | | | | | | | |
| | |
| | | | Managed Health Care 1.6% | | | | |
| | 468,456 | | | HealthEquity, Inc.* | | | 34,656,375 | |
| | | | | | | | |
| | |
| | | | Regional Banks 6.4% | | | | |
| | 1,013,416 | | | Eagle Bancorp, Inc.* | | | 50,873,483 | |
| | 283,542 | | | Independent Bank Corp. | | | 22,969,738 | |
| | 1,425,499 | | | Metro Bank plc* (United Kingdom) | | | 14,073,336 | |
| | 295,626 | | | Texas Capital Bancshares, Inc.* | | | 16,138,223 | |
| | 688,458 | | | Webster Financial Corp. | | | 34,884,167 | |
| | | | | | | | |
| | | | | | | 138,938,947 | |
| | | | | | | | |
| | |
| | | | Semiconductors 2.3% | | | | |
| | 371,229 | | | Monolithic Power Systems, Inc. | | | 50,297,817 | |
| | | | | | | | |
| | |
| | | | Specialty Chemicals 2.8% | | | | |
| | 655,075 | | | Balchem Corp. | | | 60,790,960 | |
| | | | | | | | |
| | |
| | | | Specialty Stores 1.9% | | | | |
| | 326,768 | | | Five Below, Inc.* | | | 40,600,924 | |
| | | | | | | | |
| | |
| | | | Systems Software 2.3% | | | | |
| | 402,672 | | | Proofpoint, Inc.* | | | 48,896,461 | |
| | | | | | | | |
| | |
| | | | Trading Companies & Distributors 1.0% | | | | |
| | 393,225 | | | SiteOne Landscape Supply, Inc.* | | | 22,472,809 | |
| | | | | | | | |
| | |
| | | | Trucking 4.2% | | | | |
| | 1,373,610 | | | Knight-Swift Transportation Holdings, Inc. | | | 44,889,575 | |
| | 311,699 | | | Old Dominion Freight Line, Inc. | | | 45,006,218 | |
| | | | | | | | |
| | | | | | | 89,895,793 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $1,499,110,342) | | | 2,136,939,401 | |
| | | | | | | | |
39
| | |
| WASATCH CORE GROWTH FUND(WGROX / WIGRX) | | MARCH 31, 2019 (UNAUDITED) |
|
|
|
Schedule of Investments(continued)
| | | | | | | | |
Principal Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 1.3% | | | | |
| | |
| | | | Repurchase Agreement 1.3% | | | | |
| | $27,396,297 | | | Repurchase Agreement dated 3/29/19, 0.50% due 4/1/19 with Fixed Income Clearing Corp. collateralized by $27,765,000 of United States Treasury Notes 2.375% due 3/15/22; value: $27,946,167; repurchase proceeds: $27,397,438 (cost $27,396,297) | | $ | 27,396,297 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $27,396,297) | | | 27,396,297 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $1,526,506,639) 99.9% | | | 2,164,335,698 | |
| | |
| | | | Other Assets less Liabilities 0.1% | | | 1,114,518 | |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 2,165,450,216 | |
| | | | | | | | |
| |
| | | | *Non-income producing. REIT Real Estate Investment Trust. See Notes to Financial Statements. | |
At March 31, 2019, Wasatch Core Growth Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
India | | | | 1.3 | |
Ireland | | | | 2.9 | |
Netherlands | | | | 1.8 | |
United Kingdom | | | | 2.0 | |
United States | | | | 92.0 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
40
| | |
| WASATCH EMERGING INDIA FUND(WAINX / WIINX) | | MARCH 31, 2019 (UNAUDITED) |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 100.6% | | | | |
| | |
| | | | Apparel, Accessories & Luxury Goods 2.1% | | | | |
| | 15,580 | | | Page Industries Ltd. (India) | | $ | 5,622,283 | |
| | | | | | | | |
| | |
| | | | Auto Parts & Equipment 5.1% | | | | |
| | 539,607 | | | Endurance Technologies Ltd. (India) | | | 9,012,274 | |
| | 1,373,282 | | | Minda Corp. Ltd. (India) | | | 2,681,146 | |
| | 20,595 | | | WABCO India Ltd. (India) | | | 1,981,758 | |
| | | | | | | | |
| | | | | | | 13,675,178 | |
| | | | | | | | |
| | |
| | | | Building Products 4.4% | | | | |
| | 1,004,527 | | | Kajaria Ceramics Ltd. (India) | | | 8,578,537 | |
| | 510,611 | | | Somany Ceramics Ltd. (India) | | | 3,081,725 | |
| | | | | | | | |
| | | | | | | 11,660,262 | |
| | | | | | | | |
| | |
| | | | Commodity Chemicals 5.9% | | | | |
| | 1,750,899 | | | Berger Paints India Ltd. (India) | | | 8,201,613 | |
| | 631,445 | | | Gulf Oil Lubricants India Ltd. (India) | | | 7,621,092 | |
| | | | | | | | |
| | | | | | | 15,822,705 | |
| | | | | | | | |
| | |
| | | | Consumer Finance 7.8% | | | | |
| | 478,855 | | | Bajaj Finance Ltd. (India) | | | 20,878,838 | |
| | | | | | | | |
| | |
| | | | Department Stores 5.6% | | | | |
| | 386,245 | | | V-Mart Retail Ltd. (India) | | | 14,931,554 | |
| | | | | | | | |
| | |
| | | | Diversified Banks 8.0% | | | | |
| | 1,486,586 | | | City Union Bank Ltd. (India) | | | 4,388,406 | |
| | 411,915 | | | HDFC Bank Ltd. (India) | | | 13,771,132 | |
| | 327,006 | | | RBL Bank Ltd. (India) | | | 3,200,434 | |
| | | | | | | | |
| | | | | | | 21,359,972 | |
| | | | | | | | |
| | |
| | | | Diversified Chemicals 4.4% | | | | |
| | 650,037 | | | Pidilite Industries Ltd. (India) | | | 11,715,210 | |
| | | | | | | | |
| | |
| | | | Electrical Components & Equipment 4.1% | | | | |
| | 1,057,771 | | | Amara Raja Batteries Ltd. (India) | | | 10,992,268 | |
| | | | | | | | |
| | |
| | | | Financial Exchanges & Data 1.4% | | | | |
| | 182,059 | | | CRISIL Ltd. (India) | | | 3,823,830 | |
| | | | | | | | |
| | |
| | | | Health Care Services 4.2% | | | | |
| | 750,330 | | | Dr. Lal PathLabs Ltd. (India) | | | 11,237,349 | |
| | | | | | | | |
| | |
| | | | Hotels, Resorts & Cruise Lines 1.1% | | | | |
| | 2,477,397 | | | Lemon Tree Hotels Ltd.* (India) | | | 2,878,823 | |
| | | | | | | | |
| | |
| | | | Industrial Conglomerates 2.4% | | | | |
| | 18,308 | | | 3M India Ltd.* (India) | | | 6,408,791 | |
| | | | | | | | |
| | |
| | | | Industrial Machinery 2.8% | | | | |
| | 2,053,884 | | | Elgi Equipments Ltd. (India) | | | 7,333,500 | |
| | | | | | | | |
| | |
| | | | Interactive Media & Services 3.0% | | | | |
| | 308,495 | | | Info Edge India Ltd. (India) | | | 8,129,305 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 2.3% | | | | |
| | 222,895 | | | MakeMyTrip Ltd.* (India) | | | 6,151,902 | |
| | | | | | | | |
| | |
| | | | IT Consulting & Other Services 3.2% | | | | |
| | 344,780 | | | Larsen & Toubro Infotech Ltd. (India) | | | 8,485,744 | |
| | | | | | | | |
| | |
| | | | Life & Health Insurance 2.1% | | | | |
| | 646,492 | | | ICICI Prudential Life Insurance Co. Ltd. (India) | | | 3,268,156 | |
| | 378,028 | | | Max Financial Services Ltd.* (India) | | | 2,365,028 | |
| | | | | | | | |
| | | | | | | 5,633,184 | |
| | | | | | | | |
| | |
| | | | Life Sciences Tools & Services 4.6% | | | | |
| | 494,321 | | | Divi’s Laboratories Ltd. (India) | | | 12,194,797 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Packaged Foods & Meats 2.9% | | | | |
| | 173,667 | | | Britannia Industries Ltd. (India) | | $ | 7,730,971 | |
| | | | | | | | |
| | |
| | | | Personal Products 3.9% | | | | |
| | 706,936 | | | Godrej Consumer Products Ltd. (India) | | | 6,983,130 | |
| | 21,352 | | | Procter & Gamble Hygiene & Health Care Ltd. (India) | | | 3,328,477 | |
| | | | | | | | |
| | | | | | | 10,311,607 | |
| | | | | | | | |
| | |
| | | | Pharmaceuticals 0.5% | | | | |
| | 310,677 | | | Amrutanjan Health Care Ltd. (India) | | | 1,386,218 | |
| | | | | | | | |
| | |
| | | | Property & Casualty Insurance 6.1% | | | | |
| | 1,095,917 | | | ICICI Lombard General Insurance Co. Ltd. (India) | | | 16,222,419 | |
| | | | | | | | |
| | |
| | | | Regional Banks 3.6% | | | | |
| | 1,113,188 | | | AU Small Finance Bank Ltd. (India) | | | 9,585,228 | |
| | | | | | | | |
| | |
| | | | Specialty Chemicals 1.2% | | | | |
| | 149,470 | | | Asian Paints Ltd. (India) | | | 3,214,873 | |
| | | | | | | | |
| | |
| | | | Thrifts & Mortgage Finance 7.9% | | | | |
| | 477,632 | | | Aavas Financiers Ltd.* (India) | | | 7,944,446 | |
| | 462,552 | | | Housing Development Finance Corp. Ltd. (India) | | | 13,113,708 | |
| | | | | | | | |
| | | | | | | 21,058,154 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $205,196,252) | | | 268,444,965 | |
| | | | | | | | |
| | |
Principal
Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 1.0% | | | | |
| | |
| | | | Repurchase Agreement 1.0% | | | | |
| | $2,624,967 | | | Repurchase Agreement dated 3/29/19, 0.50% due 4/1/19 with Fixed Income Clearing Corp. collateralized by $2,665,000 of United States Treasury Notes 2.375% due 3/15/22; value: $2,682,389; repurchase proceeds: $2,625,077 (cost $2,624,967) | | $ | 2,624,967 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $2,624,967) | | | 2,624,967 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $207,821,219) 101.6% | | | 271,069,932 | |
| | |
| | | | Liabilities less Other Assets (1.6%) | | | (4,211,296 | ) |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 266,858,636 | |
| | | | | | | | |
| |
| | | | *Non-income producing. See Notes to Financial Statements. | |
At March 31, 2019, Wasatch Emerging India Fund’s investments, excluding short-term investments, were in the following country:
| | | | | |
| Country | | % |
India | | | | 100.0 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
41
| | |
| WASATCH EMERGING MARKETS SELECT FUND(WAESX / WIESX) | | |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 96.2% | | | | |
| | |
| | | | Airport Services 4.0% | | | | |
| | 98,526 | | | Grupo Aeroportuario del Pacifico S.A.B. de C.V., Class B (Mexico) | | $ | 873,474 | |
| | 58,968 | | | Grupo Aeroportuario del Sureste S.A.B. de C.V., Class B (Mexico) | | | 952,955 | |
| | | | | | | | |
| | | | 1,826,429 | |
| | | | | | | | |
| | |
| | | | Apparel, Accessories & Luxury Goods 2.3% | | | | |
| | 2,918 | | | Page Industries Ltd. (India) | | | 1,053,005 | |
| | | | | | | | |
| | |
| | | | Biotechnology 3.8% | | | | |
| | 3,407 | | | Medytox, Inc. (Korea) | | | 1,752,274 | |
| | | | | | | | |
| | |
| | | | Consumer Finance 7.7% | | | | |
| | 80,422 | | | Bajaj Finance Ltd. (India) | | | 3,506,527 | |
| | | | | | | | |
| | |
| | | | Diversified Banks 10.2% | | | | |
| | 55,273 | | | HDFC Bank Ltd. (India) | | | 1,847,885 | |
| | 105,776 | | | Kasikornbank Public Co. Ltd. (Thailand) | | | 626,623 | |
| | 758,064 | | | PT Bank Central Asia Tbk (Indonesia) | | | 1,477,267 | |
| | 40,559 | | | TCS Group Holding plc (Russia) | | | 719,517 | |
| | | | | | | | |
| | | | 4,671,292 | |
| | | | | | | | |
| | |
| | | | Diversified Chemicals 1.7% | | | | |
| | 43,501 | | | Pidilite Industries Ltd. (India) | | | 783,991 | |
| | | | | | | | |
| | |
| | | | Drug Retail 3.4% | | | | |
| | 93,766 | | | Raia Drogasil S.A. (Brazil) | | | 1,563,824 | |
| | | | | | | | |
| | |
| | | | Electrical Components & Equipment 1.9% | | | | |
| | 85,497 | | | Amara Raja Batteries Ltd. (India) | | | 888,478 | |
| | | | | | | | |
| | |
| | | | Food Retail 4.1% | | | | |
| | 9,755 | | | BGF Retail Co. Ltd. (Korea) | | | 1,877,779 | |
| | | | | | | | |
| | |
| | | | Health Care Equipment 1.9% | | | | |
| | 909,116 | | | Microport Scientific Corp. (China) | | | 854,690 | |
| | | | | | | | |
| | |
| | | | Household Appliances 2.9% | | | | |
| | 200,000 | | | Techtronic Industries Co. Ltd. (Hong Kong) | | | 1,343,958 | |
| | | | | | | | |
| | |
| | | | Human Resource & Employment Services 3.0% | | | | |
| | 17,693 | | | 51job, Inc. ADR* (China) | | | 1,377,931 | |
| | | | | | | | |
| | |
| | | | Industrial Machinery 1.8% | | | | |
| | 176,901 | | | Weg S.A. (Brazil) | | | 813,265 | |
| | | | | | | | |
| | |
| | | | Interactive Media & Services 4.2% | | | | |
| | 41,625 | | | Tencent Holdings Ltd. (China) | | | 1,914,232 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 14.6% | | | | |
| | 12,413 | | | Alibaba Group Holding Ltd. ADR* (China) | | | 2,264,752 | |
| | 45,230 | | | Ctrip.com International Ltd. ADR* (China) | | | 1,976,099 | |
| | 36,466 | | | MakeMyTrip Ltd.* (India) | | | 1,006,462 | |
| | 2,828 | | | MercadoLibre, Inc.* (Brazil) | | | 1,435,860 | |
| | | | | | | | |
| | | | 6,683,173 | |
| | | | | | | | |
| | |
| | | | Life & Health Insurance 3.1% | | | | |
| | 66,023 | | | Discovery Ltd. (South Africa) | | | 625,969 | |
| | 156,718 | | | ICICI Prudential Life Insurance Co. Ltd. (India) | | | 792,243 | |
| | | | | | | | |
| | | | 1,418,212 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Packaged Foods & Meats 8.4% | | | | |
| | 27,354 | | | Britannia Industries Ltd. (India) | | $ | 1,217,692 | |
| | 74,400 | | | M Dias Branco S.A. (Brazil) | | | 825,643 | |
| | 375,393 | | | Vitasoy International Holdings Ltd. (China) | | | 1,817,201 | |
| | | | | | | | |
| | | | | | | 3,860,536 | |
| | | | | | | | |
| | |
| | | | Personal Products 4.3% | | | | |
| | 98,322 | | | Godrej Consumer Products Ltd. (India) | | | 971,227 | |
| | 780 | | | LG Household & Health Care Ltd. (Korea) | | | 973,712 | |
| | | | | | | | |
| | | | | | | 1,944,939 | |
| | | | | | | | |
| | |
| | | | Property & Casualty Insurance 3.3% | | | | |
| | 103,448 | | | ICICI Lombard General Insurance Co. Ltd. (India) | | | 1,531,299 | |
| | | | | | | | |
| | |
| | | | Semiconductors 5.9% | | | | |
| | 62,297 | | | ASPEED Technology, Inc. (Taiwan) | | | 1,427,027 | |
| | 84,959 | | | Silergy Corp. (Taiwan) | | | 1,268,024 | |
| | | | | | | | |
| | | | | | | 2,695,051 | |
| | | | | | | | |
| | |
| | | | Specialty Chemicals 2.9% | | | | |
| | 61,654 | | | Asian Paints Ltd. (India) | | | 1,326,084 | |
| | | | | | | | |
| | |
| | | | Thrifts & Mortgage Finance 0.8% | | | | |
| | 28,235 | | | PNB Housing Finance Ltd. (India) | | | 353,126 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $34,588,693) | | | 44,040,095 | |
| | | | | | | | |
| | |
| | | | PREFERRED STOCKS 2.8% | | | | |
| | |
| | | | Diversified Banks 2.8% | | | | |
| | 107,840 | | | Banco Davivienda S.A., 2.19% (Colombia) | | | 1,265,112 | |
| | | | | | | | |
| | |
| | | | Total Preferred Stocks
(cost $1,038,135) | | | 1,265,112 | |
| | | | | | | | |
| | |
Principal
Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 1.8% | | | | |
| | |
| | | | Repurchase Agreement 1.8% | | | | |
| | $811,475 | | | Repurchase Agreement dated 3/29/19, 0.50% due 4/1/19 with Fixed Income Clearing Corp. collateralized by $825,000 of United States Treasury Notes 2.375% due 3/15/22; value: $830,383; repurchase proceeds: $811,509 (cost $811,475) | | $ | 811,475 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $811,475) | | | 811,475 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $36,438,303) 100.8% | | | 46,116,682 | |
| | |
| | | | Liabilities less Other Assets (0.8%) | | | (345,775 | ) |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 45,770,907 | |
| | | | | | | | |
| |
| | | | *Non-income producing. ADR American Depositary Receipt. See Notes to Financial Statements. | |
42
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
At March 31, 2019, Wasatch Emerging Markets Select Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
Brazil | | | | 10.2 | |
China | | | | 22.5 | |
Colombia | | | | 2.8 | |
Hong Kong | | | | 3.0 | |
India | | | | 33.7 | |
Indonesia | | | | 3.3 | |
Korea | | | | 10.2 | |
Mexico | | | | 4.0 | |
Russia | | | | 1.6 | |
South Africa | | | | 1.4 | |
Taiwan | | | | 5.9 | |
Thailand | | | | 1.4 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
43
| | |
| WASATCH EMERGING MARKETS SMALL CAP FUND(WAEMX / WIEMX) | | |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 97.4% | | | | |
| | |
| | | | Air Freight & Logistics 1.3% | | | | |
| | 4,240,925 | | | Aramex PJSC (United Arab Emirates) | | $ | 5,495,774 | |
| | | | | | | | |
| | |
| | | | Airport Services 3.2% | | | | |
| | 1,642,525 | | | Grupo Aeroportuario del Centro Norte S.A.B. de C.V. (Mexico) | | | 9,260,134 | |
| | 312,071 | | | Grupo Aeroportuario del Sureste S.A.B. de C.V., Class B (Mexico) | | | 5,043,234 | |
| | | | | | | | |
| | | | 14,303,368 | |
| | | | | | | | |
| | |
| | | | Application Software 2.3% | | | | |
| | 142,488 | | | Globant S.A.* (Argentina) | | | 10,173,643 | |
| | | | | | | | |
| | |
| | | | Auto Parts & Equipment 1.4% | | | | |
| | 1,915,768 | | | Minth Group Ltd. (Hong Kong) | | | 6,027,996 | |
| | | | | | | | |
| | |
| | | | Automotive Retail 1.5% | | | | |
| | 2,642,235 | | | Zhongsheng Group Holdings Ltd. (China) | | | 6,556,824 | |
| | | | | | | | |
| | |
| | | | Biotechnology 3.2% | | | | |
| | 27,686 | | | Medytox, Inc. (Korea) | | | 14,239,350 | |
| | | | | | | | |
| | |
| | | | Building Products 1.8% | | | | |
| | 937,516 | | | Kajaria Ceramics Ltd. (India) | | | 8,006,272 | |
| | | | | | | | |
| | |
| | | | Commodity Chemicals 3.0% | | | | |
| | 1,789,356 | | | Berger Paints India Ltd. (India) | | | 8,381,754 | |
| | 4,923,202 | | | TOA Paint Thailand Public Co. Ltd. (Thailand) | | | 5,003,097 | |
| | | | | | | | |
| | | | 13,384,851 | |
| | | | | | | | |
| | |
| | | | Consumer Finance 6.6% | | | | |
| | 285,899 | | | Bajaj Finance Ltd. (India) | | | 12,465,650 | |
| | 3,467,575 | | | Muangthai Capital Public Co. Ltd. (Thailand) | | | 4,807,730 | |
| | 3,587,463 | | | Srisawad Corp. Public Co. Ltd. (Thailand) | | | 5,991,352 | |
| | 2,693,786 | | | Unifin Financiera S.A.B. de C.V. SOFOM ENR (Mexico) | | | 5,805,235 | |
| | | | | | | | |
| | | | 29,069,967 | |
| | | | | | | | |
| | |
| | | | Department Stores 1.5% | | | | |
| | 573,946 | | | Poya International Co. Ltd. (Taiwan) | | | 6,787,798 | |
| | | | | | | | |
| | |
| | | | Distillers & Vintners 1.4% | | | | |
| | 917,857 | | | Sichuan Swellfun Co. Ltd., Class A (China) | | | 6,131,157 | |
| | | | | | | | |
| | |
| | | | Diversified Banks 5.0% | | | | |
| | 2,037,263 | | | City Union Bank Ltd. (India) | | | 6,014,006 | |
| | 876,567 | | | RBL Bank Ltd. (India) | | | 8,579,032 | |
| | 434,715 | | | TCS Group Holding plc (Russia) | | | 7,711,844 | |
| | | | | | | | |
| | | | 22,304,882 | |
| | | | | | | | |
| | |
| | | | Diversified Chemicals 1.6% | | | | |
| | 385,792 | | | Pidilite Industries Ltd. (India) | | | 6,952,888 | |
| | | | | | | | |
| | |
| | | | Drug Retail 4.1% | | | | |
| | 700,894 | | | Clicks Group Ltd. (South Africa) | | | 8,948,224 | |
| | 556,710 | | | Raia Drogasil S.A. (Brazil) | | | 9,284,780 | |
| | | | | | | | |
| | | | 18,233,004 | |
| | | | | | | | |
| | |
| | | | Electrical Components & Equipment 3.3% | | | | |
| | 473,147 | | | Amara Raja Batteries Ltd. (India) | | | 4,916,904 | |
| | 491,021 | | | Voltronic Power Technology Corp. (Taiwan) | | | 9,622,708 | |
| | | | | | | | |
| | | | 14,539,612 | |
| | | | | | | | |
| | |
| | | | Electronic Equipment & Instruments 0.9% | | | | |
| | 854,616 | | | Chroma ATE, Inc. (Taiwan) | | | 4,062,272 | |
| | | | | | | | |
| | |
| | | | Food Retail 1.4% | | | | |
| | 32,958 | | | BGF Retail Co. Ltd. (Korea) | | | 6,344,219 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | General Merchandise Stores 2.7% | | | | |
| | 271,138 | | | Magazine Luiza S.A. (Brazil) | | $ | 11,969,863 | |
| | | | | | | | |
| | |
| | | | Health Care Equipment 2.7% | | | | |
| | 143,859 | | | DIO Corp.* (Korea) | | | 4,796,990 | |
| | 7,640,465 | | | Microport Scientific Corp. (China) | | | 7,183,056 | |
| | | | | | | | |
| | | | 11,980,046 | |
| | | | | | | | |
| | |
| | | | Health Care Services 1.9% | | | | |
| | 557,713 | | | Dr. Lal PathLabs Ltd. (India) | | | 8,352,613 | |
| | | | | | | | |
| | |
| | | | Highways & Railtracks 1.2% | | | | |
| | 6,584,875 | | | Yuexiu Transport Infrastructure Ltd. (China) | | | 5,360,206 | |
| | | | | | | | |
| | |
| | | | Home Furnishings 0.6% | | | | |
| | 4,680,425 | | | Man Wah Holdings Ltd. (China) | | | 2,742,687 | |
| | | | | | | | |
| | |
| | | | Hotels, Resorts & Cruise Lines 2.0% | | | | |
| | 207,815 | | | Huazhu Group Ltd. ADR (China) | | | 8,757,324 | |
| | | | | | | | |
| | |
| | | | Human Resource & Employment Services 2.9% | | | | |
| | 164,990 | | | 51job, Inc. ADR* (China) | | | 12,849,421 | |
| | | | | | | | |
| | |
| | | | Industrial Conglomerates 1.9% | | | | |
| | 23,916 | | | 3M India Ltd.* (India) | | | 8,371,895 | |
| | | | | | | | |
| | |
| | | | Industrial Machinery 2.2% | | | | |
| | 744,583 | | | Airtac International Group (Taiwan) | | | 9,639,318 | |
| | | | | | | | |
| | |
| | | | Interactive Media & Services 2.7% | | | | |
| | 450,549 | | | Info Edge India Ltd. (India) | | | 11,872,641 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 1.4% | | | | |
| | 217,028 | | | MakeMyTrip Ltd.* (India) | | | 5,989,973 | |
| | | | | | | | |
| | |
| | | | Internet Services & Infrastructure 1.1% | | | | |
| | 52,943 | | | Cafe24 Corp.* (Korea) | | | 5,037,304 | |
| | | | | | | | |
| | |
| | | | IT Consulting & Other Services 1.6% | | | | |
| | 287,260 | | | Larsen & Toubro Infotech Ltd. (India) | | | 7,070,058 | |
| | | | | | | | |
| | |
| | | | Life & Health Insurance 0.9% | | | | |
| | 639,001 | | | Max Financial Services Ltd.* (India) | | | 3,997,734 | |
| | | | | | | | |
| | |
| | | | Packaged Foods & Meats 6.8% | | | | |
| | 161,508 | | | Britannia Industries Ltd. (India) | | | 7,189,700 | |
| | 640,339 | | | M Dias Branco S.A. (Brazil) | | | 7,106,064 | |
| | 3,211,755 | | | Vitasoy International Holdings Ltd. (China) | | | 15,547,448 | |
| | | | | | | | |
| | | | 29,843,212 | |
| | | | | | | | |
| | |
| | | | Pharmaceuticals 0.7% | | | | |
| | 13,017,213 | | | China Animal Healthcare Ltd.* *** (China) | | | 16,582 | |
| | 8,110 | | | Hanmi Pharm Co. Ltd. (Korea) | | | 3,258,004 | |
| | | | | | | | |
| | | | 3,274,586 | |
| | | | | | | | |
| | |
| | | | Property & Casualty Insurance 3.3% | | | | |
| | 979,424 | | | ICICI Lombard General Insurance Co. Ltd. (India) | | | 14,498,020 | |
| | | | | | | | |
| | |
| | | | Real Estate Operating Companies 0.9% | | | | |
| | 1,519,653 | | | Parque Arauco S.A. (Chile) | | | 4,064,288 | |
| | | | | | | | |
| | |
| | | | Regional Banks 2.2% | | | | |
| | 834,369 | | | AU Small Finance Bank Ltd. (India) | | | 7,184,426 | |
| | 497,462 | | | Regional S.A.B. de C.V. (Mexico) | | | 2,505,731 | |
| | | | | | | | |
| | | | 9,690,157 | |
| | | | | | | | |
| | |
| | | | Restaurants 0.9% | | | | |
| | 587,622 | | | Gourmet Master Co. Ltd. (Taiwan) | | | 3,908,519 | |
| | | | | | | | |
44
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Semiconductor Equipment 1.2% | | | | |
| | 71,774 | | | Koh Young Technology, Inc. (Korea) | | $ | 5,406,288 | |
| | | | | | | | |
| | |
| | | | Semiconductors 9.0% | | | | |
| | 618,374 | | | ASPEED Technology, Inc. (Taiwan) | | | 14,164,989 | |
| | 90,148 | | | LEENO Industrial, Inc. (Korea) | | | 4,741,288 | |
| | 206,735 | | | Parade Technologies Ltd. (Taiwan) | | | 3,467,886 | |
| | 748,126 | | | Silergy Corp. (Taiwan) | | | 11,165,879 | |
| | 918,760 | | | Win Semiconductors Corp. (Taiwan) | | | 6,483,681 | |
| | | | | | | | |
| | | | 40,023,723 | |
| | | | | | | | |
| | |
| | | | Specialty Chemicals 0.8% | | | | |
| | 15,563,324 | | | D&L Industries, Inc. (Philippines) | | | 3,331,399 | |
| | | | | | | | |
| | |
| | | | Systems Software 1.7% | | | | |
| | 185,648 | | | Douzone Bizon Co. Ltd. (Korea) | | | 7,621,528 | |
| | | | | | | | |
| | |
| | | | Thrifts & Mortgage Finance 0.6% | | | | |
| | 224,636 | | | PNB Housing Finance Ltd. (India) | | | 2,809,450 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $311,897,447) | | | 431,076,130 | |
| | | | | | | | |
| | |
| | | | PREFERRED STOCKS 1.5% | | | | |
| | |
| | | | Personal Products 1.5% | | | | |
| | 9,288 | | | LG Household & Health Care Ltd., 1.11% (Korea) | | | 6,840,602 | |
| | | | | | | | |
| | |
| | | | Total Preferred Stocks
(cost $3,781,885) | | | 6,840,602 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $315,679,332) 98.9% | | | 437,916,732 | |
| | |
| | | | Other Assets less Liabilities 1.1% | | | 4,773,467 | |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 442,690,199 | |
| | | | | | | | |
| |
| | | | *Non-income producing. ***Security was fair valued under procedures adopted by the Board of Trustees (see Note 12). ADR American Depositary Receipt. See Notes to Financial Statements. | |
At March 31, 2019, Wasatch Emerging Markets Small Cap Fund’s investments, were in the following countries:
| | | | | |
| Country | | % |
Argentina | | | | 2.3 | |
Brazil | | | | 6.5 | |
Chile | | | | 0.9 | |
China | | | | 14.9 | |
Hong Kong | | | | 1.4 | |
India | | | | 30.3 | |
Korea | | | | 13.3 | |
Mexico | | | | 5.2 | |
Philippines | | | | 0.8 | |
Russia | | | | 1.8 | |
South Africa | | | | 2.0 | |
Taiwan | | | | 15.8 | |
Thailand | | | | 3.6 | |
United Arab Emirates | | | | 1.2 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
45
| | |
| WASATCH FRONTIER EMERGING SMALL COUNTRIES FUND(WAFMX / WIFMX) | | |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 95.1% | | | | |
| | |
| | | | Air Freight & Logistics 3.4% | | | | |
| | 1,664,587 | | | Aramex PJSC (United Arab Emirates) | | $ | 2,157,122 | |
| | | | | | | | |
| | |
| | | | Airport Services 4.8% | | | | |
| | 148,500 | | | Airports Corp. of Vietnam JSC (Vietnam) | | | 542,060 | |
| | 157,364 | | | Grupo Aeroportuario del Sureste S.A.B. de C.V., Class B (Mexico) | | | 2,543,086 | |
| | | | | | | | |
| | | | 3,085,146 | |
| | | | | | | | |
| | |
| | | | Application Software 4.5% | | | | |
| | 39,783 | | | Globant S.A.* (Argentina) | | | 2,840,506 | |
| | | | | | | | |
| | |
| | | | Consumer Finance 11.5% | | | | |
| | 469,473 | | | ASA International Group plc* (United Kingdom) | | | 2,745,478 | |
| | 552,189 | | | Delta Brac Housing Finance Corp. Ltd. (Bangladesh) | | | 905,708 | |
| | 612,100 | | | Muangthai Capital Public Co. Ltd. (Thailand) | | | 848,665 | |
| | 543,000 | | | Srisawad Corp. Public Co. Ltd. (Thailand) | | | 906,854 | |
| | 894,920 | | | Unifin Financiera S.A.B. de C.V. SOFOM ENR (Mexico) | | | 1,928,595 | |
| | | | | | | | |
| | | | 7,335,300 | |
| | | | | | | | |
| | |
| | | | Diversified Banks 21.4% | | | | |
| | 311,720 | | | Bank for Foreign Trade of Vietnam JSC (Vietnam) | | | 904,101 | |
| | 622,715 | | | Commercial International Bank S.A.E (Egypt) | | | 2,465,276 | |
| | 9,616 | | | Credicorp Ltd. (Peru) | | | 2,307,359 | |
| | 32,587 | | | Grupo Financiero Galicia S.A. ADR (Argentina) | | | 831,620 | |
| | 624,760 | | | HDBank (Vietnam) | | | 807,740 | |
| | 472,850 | | | National Bank of Kuwait SAK (Kuwait) | | | 1,399,425 | |
| | 1,370,200 | | | PT Bank Central Asia Tbk (Indonesia) | | | 2,670,158 | |
| | 125,215 | | | TCS Group Holding plc (Russia) | | | 2,221,314 | |
| | | | | | | | |
| | | | 13,606,993 | |
| | | | | | | | |
| | |
| | | | Drug Retail 7.8% | | | | |
| | 194,452 | | | Clicks Group Ltd. (South Africa) | | | 2,482,544 | |
| | 150,400 | | | Raia Drogasil S.A. (Brazil) | | | 2,508,363 | |
| | | | | | | | |
| | | | 4,990,907 | |
| | | | | | | | |
| | |
| | | | Financial Exchanges & Data 1.1% | | | | |
| | 93,337 | | | Bolsas y Mercados Argentinos S.A. (Argentina) | | | 695,241 | |
| | | | | | | | |
| | |
| | | | Food Retail 6.2% | | | | |
| | 733,800 | | | CP ALL Public Co. Ltd. (Thailand) | | | 1,728,425 | |
| | 929,404 | | | Philippine Seven Corp. (Philippines) | | | 2,212,445 | |
| | | | | | | | |
| | | | 3,940,870 | |
| | | | | | | | |
| | |
| | | | Health Care Distributors 2.2% | | | | |
| | 1,940,962 | | | Ibnsina Pharma S.A.E.* (Egypt) | | | 1,417,704 | |
| | | | | | | | |
| | |
| | | | Health Care Facilities 3.8% | | | | |
| | 6,612,880 | | | Cleopatra Hospital* (Egypt) | | | 2,445,462 | |
| | | | | | | | |
| | |
| | | | Hypermarkets & Super Centers 3.7% | | | | |
| | 65,616 | | | InRetail Peru Corp.* (Peru) | | | 2,342,491 | |
| | | | | | | | |
| | |
| | | | Industrial Machinery 2.0% | | | | |
| | 282,100 | | | Weg S.A. (Brazil) | | | 1,296,896 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 6.9% | | | | |
| | 3,631 | | | MercadoLibre, Inc.* (Brazil) | | $ | 1,843,568 | |
| | 11,040 | | | Naspers Ltd., Class N (South Africa) | | | 2,549,550 | |
| | | | | | | | |
| | | | 4,393,118 | |
| | | | | | | | |
| | |
| | | | Life & Health Insurance 2.6% | | | | |
| | 177,991 | | | Discovery Ltd. (South Africa) | | | 1,687,545 | |
| | | | | | | | |
| | |
| | | | Pharmaceuticals 1.3% | | | | |
| | 251,849 | | | Square Pharmaceuticals Ltd. (Bangladesh) | | | 799,587 | |
| | | | | | | | |
| | |
| | | | Property & Casualty Insurance 0.5% | | | | |
| | 125,000 | | | Qualitas Controladora S.A.B. de C.V. (Mexico) | | | 307,441 | |
| | | | | | | | |
| | |
| | | | Real Estate Operating Companies 4.7% | | | | |
| | 1,000,200 | | | Central Pattana Public Co. Ltd. (Thailand) | | | 2,308,639 | |
| | 245,215 | | | Parque Arauco S.A. (Chile) | | | 655,823 | |
| | | | | | | | |
| | | | 2,964,462 | |
| | | | | | | | |
| | |
| | | | Restaurants 0.5% | | | | |
| | 29,019 | | | AmRest Holdings SE* (Poland) | | | 314,422 | |
| | | | | | | | |
| | |
| | | | Technology Distributors 1.9% | | | | |
| | 606,719 | | | FPT Corp. (Vietnam) | | | 1,189,696 | |
| | | | | | | | |
| | |
| | | | Wireless Telecommunication Services 4.3% | | | | |
| | 9,888,138 | | | Safaricom plc (Kenya) | | | 2,707,466 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $57,534,594) | | | 60,518,375 | |
| | | | | | | | |
| | |
| | | | PREFERRED STOCKS 3.2% | | | | |
| | |
| | | | Diversified Banks 3.2% | | | | |
| | 170,073 | | | Banco Davivienda S.A., 2.19% (Colombia) | | | 1,995,191 | |
| | | | | | | | |
| | |
| | | | Total Preferred Stocks
(cost $1,852,963) | | | 1,995,191 | |
| | | | | | | | |
46
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | |
Principal
Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 1.4% | | | | |
| | |
| | | | Repurchase Agreement 1.4% | | | | |
| | $917,970 | | | Repurchase Agreement dated 3/29/19,
0.50% due 4/1/19 with Fixed Income
Clearing Corp. collateralized by $935,000 of United States Treasury Notes 2.375% due 3/15/22; value: $941,101; repurchase proceeds: $918,008 (cost $917,970) | | $ | 917,970 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $917,970) | | | 917,970 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $60,305,527) 99.7%§ | | | 63,431,536 | |
| | |
| | | | Other Assets less Liabilities 0.3%§§ | | | 217,449 | |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 63,648,985 | |
| | | | | | | | |
| |
| | | | *Non-income producing. §The aggregate amount of foreign securities fair valued pursuant to a systematic valuation model as a percent of net assets was 11.37%. §§Other Assets less Liabilities included a position in Zimbabwe’s currency, the RTGS dollar, which was fair valued during the period (see Note 12). ADR American Depositary Receipt. See Notes to Financial Statements. | |
At March 31, 2019, Wasatch Frontier Emerging Small Countries Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
Argentina | | | | 7.0 | |
Bangladesh | | | | 2.7 | |
Brazil | | | | 9.0 | |
Chile | | | | 1.1 | |
Colombia | | | | 3.2 | |
Egypt | | | | 10.1 | |
Indonesia | | | | 4.3 | |
Kenya | | | | 4.3 | |
Kuwait | | | | 2.2 | |
Mexico | | | | 7.6 | |
Peru | | | | 7.4 | |
Philippines | | | | 3.5 | |
Poland | | | | 0.5 | |
Russia | | | | 3.6 | |
South Africa | | | | 10.8 | |
Thailand | | | | 9.3 | |
United Arab Emirates | | | | 3.5 | |
United Kingdom | | | | 4.4 | |
Vietnam | | | | 5.5 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
47
| | |
| WASATCH GLOBAL OPPORTUNITIES FUND(WAGOX / WIGOX) | | |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 97.7% | | | | |
| | |
| | | | Airlines 1.2% | | | | |
| | 10,950 | | | Allegiant Travel Co. | | $ | 1,417,697 | |
| | | | | | | | |
| | |
| | | | Application Software 14.5% | | | | |
| | 27,605 | | | Envestnet, Inc.* | | | 1,805,091 | |
| | 21,978 | | | Five9, Inc.* | | | 1,161,098 | |
| | 36,777 | | | Globant S.A.* (Argentina) | | | 2,625,878 | |
| | 14,067 | | | HubSpot, Inc.* | | | 2,338,076 | |
| | 102,965 | | | Infomart Corp. (Japan) | | | 1,252,340 | |
| | 19,680 | | | Paylocity Holding Corp.* | | | 1,755,259 | |
| | 16,906 | | | Q2 Holdings, Inc.* | | | 1,170,909 | |
| | 40,097 | | | Systena Corp. (Japan) | | | 434,870 | |
| | 8,052 | | | Tyler Technologies, Inc.* | | | 1,645,829 | |
| | 32,756 | | | Zendesk, Inc.* | | | 2,784,260 | |
| | | | | | | | |
| | | | 16,973,610 | |
| | | | | | | | |
| | |
| | | | Automotive Retail 2.2% | | | | |
| | 29,414 | | | Monro, Inc. | | | 2,544,899 | |
| | | | | | | | |
| | |
| | | | Biotechnology 6.0% | | | | |
| | 104,041 | | | Abcam plc (United Kingdom) | | | 1,538,018 | |
| | 26,113 | | | Exact Sciences Corp.* | | | 2,261,908 | |
| | 4,930 | | | Medytox, Inc. (Korea) | | | 2,535,577 | |
| | 73,350 | | | Sangamo Therapeutics, Inc.* | | | 699,759 | |
| | | | | | | | |
| | | | 7,035,262 | |
| | | | | | | | |
| | |
| | | | Building Products 2.2% | | | | |
| | 42,529 | | | Trex Co., Inc.* | | | 2,616,384 | |
| | | | | | | | |
| | |
| | | | Commercial Printing 0.8% | | | | |
| | 11,711 | | | Cimpress N.V.* | | | 938,402 | |
| | | | | | | | |
| | |
| | | | Consumer Finance 5.0% | | | | |
| | 33,630 | | | Bajaj Finance Ltd. (India) | | | 1,466,321 | |
| | 4,007 | | | Credit Acceptance Corp.* | | | 1,810,884 | |
| | 713,371 | | | Srisawad Corp. Public Co. Ltd. (Thailand) | | | 1,191,387 | |
| | 644,500 | | | Unifin Financiera S.A.B. de C.V. SOFOM ENR (Mexico) | | | 1,388,928 | |
| | | | | | | | |
| | | | 5,857,520 | |
| | | | | | | | |
| | |
| | | | Data Processing & Outsourced Services 3.8% | | | | |
| | 25,109 | | | Euronet Worldwide, Inc.* | | | 3,580,292 | |
| | 12,800 | | | GMO Payment Gateway, Inc. (Japan) | | | 907,769 | |
| | | | | | | | |
| | | | 4,488,061 | |
| | | | | | | | |
| | |
| | | | Diversified Chemicals 1.1% | | | | |
| | 73,457 | | | Pidilite Industries Ltd. (India) | | | 1,323,870 | |
| | | | | | | | |
| | |
| | | | Diversified Real Estate Activities 0.8% | | | | |
| | 43,781 | | | Patrizia Immobilien AG (Germany) | | | 973,878 | |
| | | | | | | | |
| | |
| | | | Diversified Support Services 2.6% | | | | |
| | 51,029 | | | Copart, Inc.* | | | 3,091,847 | |
| | | | | | | | |
| | |
| | | | Drug Retail 0.8% | | | | |
| | 11,990 | | | Ain Holdings, Inc. (Japan) | | | 900,088 | |
| | | | | | | | |
| | |
| | | | Electrical Components & Equipment 2.4% | | | | |
| | 93,878 | | | Amara Raja Batteries Ltd. (India) | | | 975,572 | |
| | 90,744 | | | Voltronic Power Technology Corp. (Taiwan) | | | 1,778,342 | |
| | | | | | | | |
| | | | 2,753,914 | |
| | | | | | | | |
| | |
| | | | General Merchandise Stores 1.9% | | | | |
| | 25,532 | | | Ollie’s Bargain Outlet Holdings, Inc.* | | | 2,178,646 | |
| | | | | | | | |
| | |
| | | | Health Care Equipment 2.5% | | | | |
| | 21,998 | | | Cantel Medical Corp. | | | 1,471,446 | |
| | 11,790 | | | Cochlear Ltd. (Australia) | | | 1,450,611 | |
| | | | | | | | |
| | | | 2,922,057 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Health Care Facilities 2.7% | | | | |
| | 60,716 | | | Ensign Group, Inc. (The) | | $ | 3,108,052 | |
| | | | | | | | |
| | |
| | | | Health Care Services 1.1% | | | | |
| | 84,902 | | | Dr. Lal PathLabs Ltd. (India) | | | 1,271,538 | |
| | | | | | | | |
| | |
| | | | Health Care Supplies 1.6% | | | | |
| | 40,800 | | | Asahi Intecc Co. Ltd. (Japan) | | | 1,914,283 | |
| | | | | | | | |
| | |
| | | | Homebuilding 1.3% | | | | |
| | 26,256 | | | LGI Homes, Inc.* | | | 1,581,661 | |
| | | | | | | | |
| | |
| | | | Household Products 0.8% | | | | |
| | 21,700 | | | Pigeon Corp. (Japan) | | | 885,974 | |
| | | | | | | | |
| | |
| | | | Human Resource & Employment Services 1.5% | | | | |
| | 25,200 | | | en-japan, Inc. (Japan) | | | 732,148 | |
| | 57,230 | | | SMS Co. Ltd. (Japan) | | | 1,032,237 | |
| | | | | | | | |
| | | | 1,764,385 | |
| | | | | | | | |
| | |
| | | | Industrial Conglomerates 1.3% | | | | |
| | 4,226 | | | 3M India Ltd.* (India) | | | 1,479,329 | |
| | | | | | | | |
| | |
| | | | Industrial Machinery 7.6% | | | | |
| | 36,548 | | | Altra Industrial Motion Corp. | | | 1,134,815 | |
| | 17,697 | | | Barnes Group, Inc. | | | 909,803 | |
| | 70,100 | | | MISUMI Group, Inc. (Japan) | | | 1,740,640 | |
| | 18,328 | | | RBC Bearings, Inc.* | | | 2,330,772 | |
| | 338,508 | | | Rotork plc (United Kingdom) | | | 1,246,836 | |
| | 31,329 | | | Sun Hydraulics Corp. | | | 1,457,112 | |
| | | | | | | | |
| | | | 8,819,978 | |
| | | | | | | | |
| | |
| | | | Interactive Media & Services 0.8% | | | | |
| | 2,805 | | | XING SE (Germany) | | | 970,698 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 5.1% | | | | |
| | 62,227 | | | MakeMyTrip Ltd.* (India) | | | 1,717,465 | |
| | 4,847 | | | MercadoLibre, Inc.* (Brazil) | | | 2,460,967 | |
| | 11,621 | | | Wayfair, Inc., Class A* | | | 1,725,138 | |
| | | | | | | | |
| | | | 5,903,570 | |
| | | | | | | | |
| | |
| | | | Life & Health Insurance 1.2% | | | | |
| | 284,505 | | | ICICI Prudential Life Insurance Co. Ltd. (India) | | | 1,438,234 | |
| | | | | | | | |
| | |
| | | | Managed Health Care 1.9% | | | | |
| | 29,529 | | | HealthEquity, Inc.* | | | 2,184,555 | |
| | | | | | | | |
| | |
| | | | Packaged Foods & Meats 1.7% | | | | |
| | 406,000 | | | Vitasoy International Holdings Ltd. (China) | | | 1,965,363 | |
| | | | | | | | |
| | |
| | | | Pharmaceuticals 0.3% | | | | |
| | 25,188 | | | Intra-Cellular Therapies, Inc.* | | | 306,790 | |
| | | | | | | | |
| | |
| | | | Property & Casualty Insurance 1.4% | | | | |
| | 108,691 | | | ICICI Lombard General Insurance Co. Ltd. (India) | | | 1,608,909 | |
| | | | | | | | |
| | |
| | | | Regional Banks 4.5% | | | | |
| | 221,452 | | | AU Small Finance Bank Ltd. (India) | | | 1,906,837 | |
| | 42,437 | | | Canadian Western Bank (Canada) | | | 886,307 | |
| | 35,208 | | | Eagle Bancorp, Inc.* | | | 1,767,442 | |
| | 66,347 | | | Metro Bank plc* (United Kingdom) | | | 655,015 | |
| | | | | | | | |
| | | | 5,215,601 | |
| | | | | | | | |
| | |
| | | | Research & Consulting Services 1.7% | | | | |
| | 706 | | | Funai Soken Holdings, Inc. (Japan) | | | 16,964 | |
| | 72,700 | | | Nihon M&A Center, Inc. (Japan) | | | 1,987,557 | |
| | | | | | | | |
| | | | 2,004,521 | |
| | | | | | | | |
| | |
| | | | Restaurants 1.0% | | | | |
| | 37,066 | | | Domino’s Pizza Enterprises Ltd. (Australia) | | | 1,142,758 | |
| | | | | | | | |
48
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Semiconductor Equipment 0.7% | | | | |
| | 71,800 | | | Japan Material Co. Ltd. (Japan) | | $ | 878,470 | |
| | | | | | | | |
| | |
| | | | Semiconductors 4.3% | | | | |
| | 48,000 | | | ASPEED Technology, Inc. (Taiwan) | | | 1,099,528 | |
| | 10,534 | | | Melexis N.V. (Belgium) | | | 637,501 | |
| | 15,681 | | | Monolithic Power Systems, Inc. | | | 2,124,619 | |
| | 75,000 | | | Silergy Corp. (Taiwan) | | | 1,119,385 | |
| | | | | | | | |
| | | | 4,981,033 | |
| | | | | | | | |
| | |
| | | | Soft Drinks 1.4% | | | | |
| | 41,499 | | | Fevertree Drinks plc (United Kingdom) | | | 1,631,780 | |
| | | | | | | | |
| | |
| | | | Specialty Chemicals 0.8% | | | | |
| | 107,669 | | | Hexpol AB (Sweden) | | | 905,030 | |
| | | | | | | | |
| | |
| | | | Specialty Stores 1.8% | | | | |
| | 17,000 | | | Five Below, Inc.* | | | 2,112,250 | |
| | | | | | | | |
| | |
| | | | Technology Distributors 0.7% | | | | |
| | 113,051 | | | Electrocomponents plc (United Kingdom) | | | 827,213 | |
| | | | | | | | |
| | |
| | | | Trading Companies & Distributors 0.8% | | | | |
| | 44,500 | | | MonotaRO Co. Ltd. (Japan) | | | 988,131 | |
| | | | | | | | |
| | |
| | | | Trucking 1.9% | | | | |
| | 66,431 | | | Knight-Swift Transportation Holdings, Inc. | | | 2,170,965 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $80,156,360) | | | 114,077,206 | |
| | | | | | | | |
| | |
Principal
Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 1.9% | | | | |
| | |
| | | | Repurchase Agreement 1.9% | | | | |
| | $2,196,646 | | | Repurchase Agreement dated 3/29/19, 0.50% due 4/1/19 with Fixed Income Clearing Corp. collateralized by $2,230,000 of United States Treasury Notes 2.375% due 3/15/22; value: $2,244,551; repurchase proceeds: $2,196,738 (cost $2,196,646) | | $ | 2,196,646 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $2,196,646) | | | 2,196,646 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $82,353,006) 99.6% | | | 116,273,852 | |
| | |
| | | | Other Assets less Liabilities 0.4% | | | 437,208 | |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 116,711,060 | |
| | | | | | | | |
| |
| | | | *Non-income producing. See Notes to Financial Statements. | |
At March 31, 2019, Wasatch Global Opportunities Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
Argentina | | | | 2.3 | |
Australia | | | | 2.3 | |
Belgium | | | | 0.6 | |
Brazil | | | | 2.1 | |
Canada | | | | 0.8 | |
China | | | | 1.7 | |
Germany | | | | 1.7 | |
India | | | | 11.6 | |
Japan | | | | 12.0 | |
Korea | | | | 2.2 | |
Mexico | | | | 1.2 | |
Sweden | | | | 0.8 | |
Taiwan | | | | 3.5 | |
Thailand | | | | 1.0 | |
United Kingdom | | | | 5.2 | |
United States | | | | 51.0 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
49
| | |
| WASATCH GLOBAL VALUE FUND(FMIEX / WILCX) | | |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 97.5% | | | | |
| | |
| | | | Airlines 3.1% | | | | |
| | 150,868 | | | Japan Airlines Co. Ltd. (Japan) | | $ | 5,307,537 | |
| | | | | | | | |
| | |
| | | | Casinos & Gaming 1.1% | | | | |
| | 64,000 | | | Kangwon Land, Inc. (Korea) | | | 1,804,246 | |
| | | | | | | | |
| | |
| | | | Commodity Chemicals 1.1% | | | | |
| | 920,000 | | | PTT Global Chemical Public Co. Ltd. (Thailand) | | | 1,949,582 | |
| | | | | | | | |
| | |
| | | | Communications Equipment 3.1% | | | | |
| | 100,000 | | | Cisco Systems, Inc. | | | 5,399,000 | |
| | | | | | | | |
| | |
| | | | Diversified Banks 14.8% | | | | |
| | 71,000 | | | Citigroup, Inc. | | | 4,417,620 | |
| | 279,000 | | | ING Groep N.V. ADR (Netherlands) | | | 3,387,060 | |
| | 2,782,500 | | | Mizuho Financial Group, Inc. (Japan) | | | 4,300,661 | |
| | 671,000 | | | Nordea Bank Abp (Sweden) | | | 5,106,133 | |
| | 50,000 | | | Sumitomo Mitsui Financial Group, Inc. (Japan) | | | 1,748,624 | |
| | 133,000 | | | Wells Fargo & Co. | | | 6,426,560 | |
| | | | | | | | |
| | | | 25,386,658 | |
| | | | | | | | |
| | |
| | | | Diversified Metals & Mining 1.7% | | | | |
| | 111,000 | | | Anglo American plc (United Kingdom) | | | 2,968,784 | |
| | | | | | | | |
| | |
| | | | Electric Utilities 7.7% | | | | |
| | 60,968 | | | Entergy Corp. | | | 5,830,370 | |
| | 146,500 | | | Exelon Corp. | | | 7,344,045 | |
| | | | | | | | |
| | | | 13,174,415 | |
| | | | | | | | |
| | |
| | | | Electrical Components & Equipment 3.2% | | | | |
| | 68,000 | | | Eaton Corp. plc | | | 5,478,080 | |
| | | | | | | | |
| | |
| | | | Environmental & Facilities Services 1.7% | | | | |
| | 79,280 | | | ABM Industries, Inc. | | | 2,881,828 | |
| | | | | | | | |
| | |
| | | | Health Care Services 5.7% | | | | |
| | 96,246 | | | CVS Health Corp. | | | 5,190,547 | |
| | 30,001 | | | Laboratory Corp. of America Holdings* | | | 4,589,553 | |
| | | | | | | | |
| | | | 9,780,100 | |
| | | | | | | | |
| | |
| | | | Hypermarkets & Super Centers 2.7% | | | | |
| | 47,000 | | | Walmart, Inc. | | | 4,583,910 | |
| | | | | | | | |
| | |
| | | | Integrated Oil & Gas 7.2% | | | | |
| | 116,700 | | | Royal Dutch Shell plc ADR, Class A (United Kingdom) | | | 7,304,253 | |
| | 154,000 | | | Suncor Energy, Inc. (Canada) | | | 4,991,013 | |
| | | | | | | | |
| | | | 12,295,266 | |
| | | | | | | | |
| | |
| | | | Integrated Telecommunication Services 3.5% | | | | |
| | 193,572 | | | AT&T, Inc. | | | 6,070,418 | |
| | | | | | | | |
| | |
| | | | Life & Health Insurance 2.7% | | | | |
| | 3,100,000 | | | Fubon Financial Holding Co. Ltd. (Taiwan) | | | 4,626,791 | |
| | | | | | | | |
| | |
| | | | Oil & Gas Drilling 0.8% | | | | |
| | 345,000 | | | Ensco plc, Class A | | | 1,355,850 | |
| | | | | | | | |
| | |
| | | | Oil & Gas Equipment & Services 2.8% | | | | |
| | 111,000 | | | Schlumberger Ltd. | | | 4,836,270 | |
| | | | | | | | |
| | |
| | | | Packaged Foods & Meats 2.2% | | | | |
| | 50,000 | | | Danone S.A. (France) | | | 3,852,651 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Pharmaceuticals 8.0% | | | | |
| | 76,368 | | | Novartis AG (Switzerland) | | $ | 7,345,747 | |
| | 149,726 | | | Pfizer, Inc. | | | 6,358,863 | |
| | | | | | | | |
| | | | 13,704,610 | |
| | | | | | | | |
| | |
| | | | Property & Casualty Insurance 2.5% | | | | |
| | 78,500 | | | Axis Capital Holdings Ltd. | | | 4,300,230 | |
| | | | | | | | |
| | |
| | | | Reinsurance 4.3% | | | | |
| | 31,000 | | | Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen (Germany) | | | 7,337,369 | |
| | | | | | | | |
| | |
| | | | Specialized REITs 4.9% | | | | |
| | 76,000 | | | EPR Properties | | | 5,844,400 | |
| | 115,000 | | | VICI Properties, Inc. | | | 2,516,200 | |
| | | | | | | | |
| | | | 8,360,600 | |
| | | | | | | | |
| | |
| | | | Systems Software 5.1% | | | | |
| | 31,000 | | | Check Point Software Technologies Ltd.* (Israel) | | | 3,921,190 | |
| | 90,000 | | | Oracle Corp. | | | 4,833,900 | |
| | | | | | | | |
| | | | 8,755,090 | |
| | | | | | | | |
| | |
| | | | Technology Hardware, Storage & Peripherals 1.2% | | | | |
| | 52,000 | | | Samsung Electronics Co. Ltd. (Korea) | | | 2,045,459 | |
| | | | | | | | |
| | |
| | | | Tobacco 2.2% | | | | |
| | 41,000 | | | KT&G Corp. (Korea) | | | 3,738,437 | |
| | | | | | | | |
| | |
| | | | Wireless Telecommunication Services 4.2% | | | | |
| | 700,000 | | | China Mobile Ltd. (China) | | | 7,133,803 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $153,600,085) | | | 167,126,984 | |
| | | | | | | | |
| | |
Principal Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 2.1% | | | | |
| | |
| | | | Repurchase Agreement 2.1% | | | | |
| | $3,535,378 | | | Repurchase Agreement dated 3/29/19, 0.50% due 4/1/19 with Fixed Income Clearing Corp. collateralized by $3,585,000 of United States Treasury Notes 2.375% due 3/15/22; value: $3,608,392; repurchase proceeds: $3,535,525 (cost $3,535,378) | | $ | 3,535,378 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $3,535,378) | | | 3,535,378 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $157,135,463) 99.6% | | | 170,662,362 | |
| | |
| | | | Other Assets less Liabilities 0.4% | | | 728,014 | |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 171,390,376 | |
| | | | | | | | |
| |
| | | | *Non-income producing. ADR American Depositary Receipt. REIT Real Estate Investment Trust. See Notes to Financial Statements. | |
50
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
At March 31, 2019, Wasatch Global Value Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
Canada | | | | 3.0 | |
China | | | | 4.3 | |
France | | | | 2.3 | |
Germany | | | | 4.4 | |
Israel | | | | 2.3 | |
Japan | | | | 6.8 | |
Korea | | | | 4.5 | |
Netherlands | | | | 2.0 | |
Sweden | | | | 3.1 | |
Switzerland | | | | 4.4 | |
Taiwan | | | | 2.8 | |
Thailand | | | | 1.2 | |
United Kingdom | | | | 6.1 | |
United States | | | | 52.8 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
51
| | |
| WASATCH INTERNATIONAL GROWTH FUND(WAIGX / WIIGX) | | |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 96.6% | | | | |
| | |
| | | | Airport Services 1.1% | | | | |
| | 2,589,053 | | | Grupo Aeroportuario del Centro Norte S.A.B. de C.V. (Mexico) | | $ | 14,596,415 | |
| | | | | | | | |
| | |
| | | | Apparel, Accessories & Luxury Goods 3.8% | | | | |
| | 504,590 | | | Moncler S.p.A. (Italy) | | | 20,331,581 | |
| | 42,999 | | | Page Industries Ltd. (India) | | | 15,516,851 | |
| | 610,305 | | | Ted Baker plc (United Kingdom) | | | 12,384,410 | |
| | | | | | | | |
| | | | 48,232,842 | |
| | | | | | | | |
| | |
| | | | Application Software 10.6% | | | | |
| | 500,822 | | | Aveva Group plc (United Kingdom) | | | 21,043,051 | |
| | 919,670 | | | GB Group plc (United Kingdom) | | | 5,863,348 | |
| | 1,364,179 | | | Infomart Corp. (Japan) | | | 16,592,198 | |
| | 273,316 | | | Kinaxis, Inc.* (Canada) | | | 15,946,757 | |
| | 505,101 | | | Miroku Jyoho Service Co. Ltd. (Japan) | | | 12,947,685 | |
| | 70,193 | | | Nemetschek SE (Germany) | | | 11,968,331 | |
| | 1,139,265 | | | Systena Corp. (Japan) | | | 12,355,829 | |
| | 3,113,326 | | | Technology One Ltd. (Australia) | | | 17,684,931 | |
| | 1,265,171 | | | WiseTech Global Ltd. (Australia) | | | 20,769,490 | |
| | | | | | | | |
| | | | 135,171,620 | |
| | | | | | | | |
| | |
| | | | Asset Management & Custody Banks 2.1% | | | | |
| | 661,876 | | | Burford Capital Ltd. (United Kingdom) | | | 14,534,335 | |
| | 2,101,950 | | | Netwealth Group Ltd. (Australia) | | | 12,298,110 | |
| | | | | | | | |
| | | | 26,832,445 | |
| | | | | | | | |
| | |
| | | | Biotechnology 2.5% | | | | |
| | 1,501,149 | | | Abcam plc (United Kingdom) | | | 22,191,191 | |
| | 18,386 | | | Medytox, Inc. (Korea) | | | 9,456,212 | |
| | | | | | | | |
| | | | 31,647,403 | |
| | | | | | | | |
| | |
| | | | Commodity Chemicals 1.9% | | | | |
| | 3,267,867 | | | Berger Paints India Ltd. (India) | | | 15,307,439 | |
| | 8,874,291 | | | TOA Paint Thailand Public Co. Ltd. (Thailand) | | | 9,018,304 | |
| | | | | | | | |
| | | | 24,325,743 | |
| | | | | | | | |
| | |
| | | | Construction Machinery & Heavy Trucks 0.6% | | | | |
| | 452,500 | | | Takeuchi Manufacturing Co. Ltd. (Japan) | | | 7,949,269 | |
| | | | | | | | |
| | |
| | | | Data Processing & Outsourced Services 1.8% | | | | |
| | 628,850 | | | Afterpay Touch Group Ltd.* (Australia) | | | 9,354,485 | |
| | 185,900 | | | GMO Payment Gateway, Inc. (Japan) | | | 13,183,921 | |
| | | | | | | | |
| | | | 22,538,406 | |
| | | | | | | | |
| | |
| | | | Diversified Real Estate Activities 1.8% | | | | |
| | 1,012,158 | | | Patrizia Immobilien AG (Germany) | | | 22,514,755 | |
| | | | | | | | |
| | |
| | | | Diversified Support Services 0.0% | | | | |
| | 36,479 | | | Prestige International, Inc. (Japan) | | | 457,510 | |
| | | | | | | | |
| | |
| | | | Drug Retail 4.6% | | | | |
| | 173,028 | | | Ain Holdings, Inc. (Japan) | | | 12,989,199 | |
| | 890,912 | | | Clicks Group Ltd. (South Africa) | | | 11,374,159 | |
| | 190,900 | | | Kusuri no Aoki Holdings Co. Ltd. (Japan) | | | 13,641,866 | |
| | 509,200 | | | Raia Drogasil S.A. (Brazil) | | | 8,492,411 | |
| | 142,800 | | | Tsuruha Holdings, Inc. (Japan) | | | 11,596,138 | |
| | | | | | | | |
| | | | 58,093,773 | |
| | | | | | | | |
| | |
| | | | Electrical Components & Equipment 1.5% | | | | |
| | 857,669 | | | Amara Raja Batteries Ltd. (India) | | | 8,912,825 | |
| | 528,277 | | | Voltronic Power Technology Corp. (Taiwan) | | | 10,352,827 | |
| | | | | | | | |
| | | | 19,265,652 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Electronic Equipment & Instruments 1.7% | | | | |
| | 1,011,841 | | | Halma plc (United Kingdom) | | $ | 22,034,819 | |
| | | | | | | | |
| | |
| | | | General Merchandise Stores 1.3% | | | | |
| | 3,307,768 | | | B&M European Value Retail S.A. (United Kingdom) | | | 16,095,440 | |
| | | | | | | | |
| | |
| | | | Health Care Equipment 4.6% | | | | |
| | 202,513 | | | Cochlear Ltd. (Australia) | | | 24,916,678 | |
| | 202,351 | | | DiaSorin S.p.A. (Italy) | | | 20,360,760 | |
| | 5,491,000 | | | Microport Scientific Corp. (China) | | | 5,162,272 | |
| | 457,164 | | | Nakanishi, Inc. (Japan) | | | 8,922,185 | |
| | | | | | | | |
| | | | 59,361,895 | |
| | | | | | | | |
| | |
| | | | Health Care Supplies 1.8% | | | | |
| | 483,700 | | | Asahi Intecc Co. Ltd. (Japan) | | | 22,694,577 | |
| | | | | | | | |
| | |
| | | | Health Care Technology 1.5% | | | | |
| | 779,320 | | | M3, Inc. (Japan) | | | 13,057,812 | |
| | 568,277 | | | RaySearch Laboratories AB* (Sweden) | | | 6,338,434 | |
| | | | | | | | |
| | | | 19,396,246 | |
| | | | | | | | |
| | |
| | | | Home Furnishing Retail 0.7% | | | | |
| | 484,486 | | | Maisons du Monde S.A. (France) | | | 9,358,593 | |
| | | | | | | | |
| | |
| | | | Hotels, Resorts & Cruise Lines 0.9% | | | | |
| | 629,622 | | | Corporate Travel Management Ltd. (Australia) | | | 11,382,223 | |
| | | | | | | | |
| | |
| | | | Household Products 1.5% | | | | |
| | 458,284 | | | Pigeon Corp. (Japan) | | | 18,710,955 | |
| | | | | | | | |
| | |
| | | | Human Resource & Employment Services 5.2% | | | | |
| | 280,948 | | | 51job, Inc. ADR* (China) | | | 21,880,230 | |
| | 525,849 | | | Benefit One, Inc. (Japan) | | | 10,305,369 | |
| | 367,397 | | | en-japan, Inc. (Japan) | | | 10,674,171 | |
| | 668,642 | | | SMS Co. Ltd. (Japan) | | | 12,060,050 | |
| | 510,774 | | | UT Group Co. Ltd. (Japan) | | | 11,687,475 | |
| | | | | | | | |
| | | | 66,607,295 | |
| | | | | | | | |
| | |
| | | | Industrial Machinery 3.6% | | | | |
| | 925,915 | | | MISUMI Group, Inc. (Japan) | | | 22,991,230 | |
| | 4,411,442 | | | Rotork plc (United Kingdom) | | | 16,248,786 | |
| | 143,523 | | | Stabilus S.A. (Germany) | | | 6,922,870 | |
| | | | | | | | |
| | | | 46,162,886 | |
| | | | | | | | |
| | |
| | | | Interactive Media & Services 4.2% | | | | |
| | 371,703 | | | Info Edge India Ltd. (India) | | | 9,794,931 | |
| | 2,173,091 | | | Rightmove plc (United Kingdom) | | | 14,434,742 | |
| | 84,610 | | | XING SE (Germany) | | | 29,280,134 | |
| | | | | | | | |
| | | | 53,509,807 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 2.2% | | | | |
| | 155,152 | | | ASOS plc* (United Kingdom) | | | 6,466,485 | |
| | 1,747,752 | | | Webjet Ltd. (Australia) | | | 18,056,418 | |
| | 276,133 | | | Yume No Machi Souzou Iinkai Co. Ltd. (Japan) | | | 3,963,977 | |
| | | | | | | | |
| | | | 28,486,880 | |
| | | | | | | | |
| | |
| | | | Investment Banking & Brokerage 1.4% | | | | |
| | 304,044 | | | Avanza Bank Holding AB (Sweden) | | | 13,048,256 | |
| | 102,403 | | | M&A Capital Partners Co. Ltd.* (Japan) | | | 4,656,782 | |
| | | | | | | | |
| | | | 17,705,038 | |
| | | | | | | | |
| | |
| | | | IT Consulting & Other Services 1.3% | | | | |
| | 256,866 | | | Reply S.p.A. (Italy) | | | 16,539,208 | |
| | | | | | | | |
| | |
| | | | Life Sciences Tools & Services 0.9% | | | | |
| | 49,033 | | | Tecan Group AG (Switzerland) | | | 11,562,087 | |
| | | | | | | | |
52
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | |
Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Movies & Entertainment 1.1% | | | | |
| | 289,148 | | | CTS Eventim AG & Co KGaA (Germany) | | $ | 13,700,622 | |
| | | | | | | | |
| | |
| | | | Oil & Gas Equipment & Services 1.7% | | | | |
| | 770,504 | | | Pason Systems, Inc. (Canada) | | | 11,243,183 | |
| | 400,035 | | | TGS-NOPEC Geophysical Co. ASA (Norway) | | | 10,913,482 | |
| | | | | | | | |
| | | | 22,156,665 | |
| | | | | | | | |
| | |
| | | | Other Diversified Financial Services 1.2% | | | | |
| | 77,885 | | | Hypoport AG* (Germany) | | | 15,638,786 | |
| | | | | | | | |
| | |
| | | | Packaged Foods & Meats 3.0% | | | | |
| | 7,985,449 | | | Vitasoy International Holdings Ltd. (China) | | | 38,655,923 | |
| | | | | | | | |
| | |
| | | | Property & Casualty Insurance 1.4% | | | | |
| | 1,223,064 | | | ICICI Lombard General Insurance Co. Ltd. (India) | | | 18,104,525 | |
| | | | | | | | |
| | |
| | | | Regional Banks 3.2% | | | | |
| | 1,840,175 | | | AU Small Finance Bank Ltd. (India) | | | 15,845,029 | |
| | 869,524 | | | Canadian Western Bank (Canada) | | | 18,160,224 | |
| | 734,246 | | | Metro Bank plc* (United Kingdom) | | | 7,248,894 | |
| | | | | | | | |
| | | | 41,254,147 | |
| | | | | | | | |
| | |
| | | | Research & Consulting Services 2.9% | | | | |
| | 560,015 | | | Funai Soken Holdings, Inc. (Japan) | | | 13,455,923 | |
| | 840,828 | | | Nihon M&A Center, Inc. (Japan) | | | 22,987,538 | |
| | | | | | | | |
| | | | 36,443,461 | |
| | | | | | | | |
| | |
| | | | Restaurants 1.4% | | | | |
| | 565,845 | | | Domino’s Pizza Enterprises Ltd. (Australia) | | | 17,445,205 | |
| | | | | | | | |
| | |
| | | | Semiconductor Equipment 1.6% | | | | |
| | 915,000 | | | Japan Material Co. Ltd. (Japan) | | | 11,194,983 | |
| | 80,562 | | | Koh Young Technology, Inc. (Korea) | | | 6,068,233 | |
| | 81,255 | | | Lasertec Corp. (Japan) | | | 3,390,818 | |
| | | | | | | | |
| | | | 20,654,034 | |
| | | | | | | | |
| | |
| | | | Semiconductors 2.6% | | | | |
| | 196,244 | | | Melexis N.V. (Belgium) | | | 11,876,379 | |
| | 993,165 | | | Silergy Corp. (Taiwan) | | | 14,823,118 | |
| | 91,824 | | | U-Blox Holding AG* (Switzerland) | | | 6,971,523 | |
| | | | | | | | |
| | | | 33,671,020 | |
| | | | | | | | |
| | |
| | | | Soft Drinks 2.0% | | | | |
| | 647,923 | | | Fevertree Drinks plc (United Kingdom) | | | 25,476,951 | |
| | | | | | | | |
| | |
| | | | Specialty Chemicals 2.7% | | | | |
| | 224,454 | | | Chr. Hansen Holding A/S (Denmark) | | | 22,750,949 | |
| | 1,444,896 | | | Hexpol AB (Sweden) | | | 12,145,314 | |
| | | | | | | | |
| | | | 34,896,263 | |
| | | | | | | | |
| | |
| | | | Systems Software 0.7% | | | | |
| | 202,567 | | | Douzone Bizon Co. Ltd. (Korea) | | | 8,316,115 | |
| | | | | | | | |
| | |
| | | | Technology Distributors 1.6% | | | | |
| | 2,737,421 | | | Electrocomponents plc (United Kingdom) | | | 20,030,153 | |
| | | | | | | | |
| | |
| | | | Trading Companies & Distributors 4.4% | | | | |
| | 903,264 | | | Diploma plc (United Kingdom) | | | 17,152,727 | |
| | 156,906 | | | IMCD N.V. (Netherlands) | | | 11,942,234 | |
| | 598,324 | | | MonotaRO Co. Ltd. (Japan) | | | 13,285,892 | |
| | 759,074 | | | Richelieu Hardware Ltd. (Canada) | | | 13,456,402 | |
| | | | | | | | |
| | | | 55,837,255 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $943,804,331) | | | 1,233,514,907 | |
| | | | | | | | |
| | | | | | | | |
Principal
Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 3.2% | | | | |
| | |
| | | | Repurchase Agreement 3.2% | | | | |
| | $40,838,984 | | | Repurchase Agreement dated 3/29/19, 0.50% due 4/1/19 with Fixed Income Clearing Corp. collateralized by $41,390,000 of United States Treasury Notes 2.375% due 3/15/22; value: $41,660,070; repurchase proceeds: $40,840,686 (cost $40,838,984) | | $ | 40,838,984 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $40,838,984) | | | 40,838,984 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $984,643,315) 99.8% | | | 1,274,353,891 | |
| | |
| | | | Other Assets less Liabilities 0.2% | | | 2,747,976 | |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 1,277,101,867 | |
| | | | | | | | |
| |
| | | | *Non-income producing. ADR American Depositary Receipt. See Notes to Financial Statements. | |
At March 31, 2019, Wasatch International Growth Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
Australia | | | | 10.7 | |
Belgium | | | | 1.0 | |
Brazil | | | | 0.7 | |
Canada | | | | 4.8 | |
China | | | | 5.3 | |
Denmark | | | | 1.8 | |
France | | | | 0.8 | |
Germany | | | | 8.1 | |
India | | | | 6.8 | |
Italy | | | | 4.6 | |
Japan | | | | 24.8 | |
Korea | | | | 1.9 | |
Mexico | | | | 1.2 | |
Netherlands | | | | 1.0 | |
Norway | | | | 0.9 | |
South Africa | | | | 0.9 | |
Sweden | | | | 2.6 | |
Switzerland | | | | 1.5 | |
Taiwan | | | | 2.0 | |
Thailand | | | | 0.7 | |
United Kingdom | | | | 17.9 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
53
| | |
| WASATCH INTERNATIONAL OPPORTUNITIES FUND(WAIOX / WIIOX) | | |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 95.4% | | | | |
| | |
| | | | Aerospace & Defense 0.8% | | | | |
| | 186,861 | | | Avon Rubber plc (United Kingdom) | | $ | 3,163,902 | |
| | | | | | | | |
| | |
| | | | Apparel, Accessories & Luxury Goods 0.2% | | | | |
| | 525,500 | | | JNBY Design Ltd. (China) | | | 1,056,362 | |
| | | | | | | | |
| | |
| | | | Application Software 11.3% | | | | |
| | 132,371 | | | BusinessOn Communication Co. Ltd. (Korea) | | | 1,533,502 | |
| | 77,861 | | | Esker S.A. (France) | | | 5,956,629 | |
| | 48,995 | | | Fixstars Corp. (Japan) | | | 614,924 | |
| | 672,164 | | | Fortnox AB (Sweden) | | | 6,795,889 | |
| | 791,092 | | | GB Group plc (United Kingdom) | | | 5,043,600 | |
| | 15,356,300 | | | Humanica Public Co. Ltd. (Thailand) | | | 4,524,387 | |
| | 535,500 | | | Infomart Corp. (Japan) | | | 6,513,164 | |
| | 162,800 | | | Miroku Jyoho Service Co. Ltd. (Japan) | | | 4,173,191 | |
| | 270,086 | | | Rakus Co. Ltd. (Japan) | | | 4,917,744 | |
| | 597,476 | | | Systena Corp. (Japan) | | | 6,479,890 | |
| | | | | | | | |
| | | | 46,552,920 | |
| | | | | | | | |
| | |
| | | | Auto Parts & Equipment 1.8% | | | | |
| | 906,000 | | | Hota Industrial Manufacturing Co. Ltd. (Taiwan) | | | 3,336,448 | |
| | 2,157,686 | | | Minda Corp. Ltd. (India) | | | 4,212,588 | |
| | | | | | | | |
| | | | 7,549,036 | |
| | | | | | | | |
| | |
| | | | Automotive Retail 0.1% | | | | |
| | 436,336 | | | Hascol Petroleum Ltd. (Pakistan) | | | 396,810 | |
| | | | | | | | |
| | |
| | | | Brewers 1.7% | | | | |
| | 607,145 | | | Carlsberg Brewery Malaysia Berhad, Class B (Malaysia) | | | 3,976,744 | |
| | 42,497 | | | Royal Unibrew A/S (Denmark) | | | 3,135,202 | |
| | | | | | | | |
| | | | 7,111,946 | |
| | | | | | | | |
| | |
| | | | Building Products 1.1% | | | | |
| | 513,260 | | | Kajaria Ceramics Ltd. (India) | | | 4,383,177 | |
| | | | | | | | |
| | |
| | | | Commodity Chemicals 3.9% | | | | |
| | 867,649 | | | Berger Paints India Ltd. (India) | | | 4,064,267 | |
| | 666,740 | | | Gulf Oil Lubricants India Ltd. (India) | | | 8,047,078 | |
| | 255,016 | | | Supreme Industries Ltd. (India) | | | 4,016,571 | |
| | | | | | | | |
| | | | 16,127,916 | |
| | | | | | | | |
| | |
| | | | Consumer Finance 3.9% | | | | |
| | 819,635 | | | ASA International Group plc* (United Kingdom) | | | 4,793,225 | |
| | 318,806 | | | Gruppo MutuiOnline S.p.A. (Italy) | | | 6,601,678 | |
| | 2,204,062 | | | Unifin Financiera S.A.B. de C.V. SOFOM ENR (Mexico) | | | 4,749,857 | |
| | | | | | | | |
| | | | 16,144,760 | |
| | | | | | | | |
| | |
| | | | Department Stores 2.7% | | | | |
| | 335,908 | | | Poya International Co. Ltd. (Taiwan) | | | 3,972,631 | |
| | 184,712 | | | V-Mart Retail Ltd. (India) | | | 7,140,642 | |
| | | | | | | | |
| | | | 11,113,273 | |
| | | | | | | | |
| | |
| | | | Diversified Banks 0.4% | | | | |
| | 203,826 | | | Sbanken ASA (Norway) | | | 1,850,396 | |
| | | | | | | | |
| | |
| | | | Diversified Support Services 3.1% | | | | |
| | 703,567 | | | Clipper Logistics plc (United Kingdom) | | | 2,437,519 | |
| | 248,100 | | | Japan Elevator Service Holdings Co. Ltd. (Japan) | | | 5,034,529 | |
| | 427,841 | | | Prestige International, Inc. (Japan) | | | 5,365,867 | |
| | | | | | | | |
| | | | 12,837,915 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Drug Retail 1.5% | | | | |
| | 50,000 | | | Kusuri no Aoki Holdings Co. Ltd. (Japan) | | $ | 3,573,040 | |
| | 103,400 | | | Yakuodo Co. Ltd. (Japan) | | | 2,478,875 | |
| | | | | | | | |
| | | | 6,051,915 | |
| | | | | | | | |
| | |
| | | | Electrical Components & Equipment 2.0% | | | | |
| | 223,393 | | | Amara Raja Batteries Ltd. (India) | | | 2,321,481 | |
| | 310,627 | | | Voltronic Power Technology Corp.* (Taiwan) | | | 6,087,465 | |
| | | | | | | | |
| | | | 8,408,946 | |
| | | | | | | | |
| | |
| | | | Electronic Equipment & Instruments 0.9% | | | | |
| | 97,175 | | | Isra Vision AG (Germany) | | | 3,629,903 | |
| | | | | | | | |
| | |
| | | | Electronic Manufacturing Services 0.9% | | | | |
| | 222,458 | | | HMS Networks AB (Sweden) | | | 3,861,844 | |
| | | | | | | | |
| | |
| | | | Financial Exchanges & Data 0.1% | | | | |
| | 142,821 | | | Morningstar Japan KK (Japan) | | | 389,172 | |
| | | | | | | | |
| | |
| | | | Food Retail 4.3% | | | | |
| | 7,210,397 | | | 7-Eleven Malaysia Holdings Berhad, Class B (Malaysia) | | | 2,613,934 | |
| | 3,819,129 | | | Philippine Seven Corp. (Philippines) | | | 9,091,433 | |
| | 70,499 | | | Rami Levy Chain Stores Hashikma Marketing 2006 Ltd. (Israel) | | | 3,567,758 | |
| | 3,241,400 | | | Sheng Siong Group Ltd. (Singapore) | | | 2,487,405 | |
| | | | | | | | |
| | | | 17,760,530 | |
| | | | | | | | |
| | |
| | | | Health Care Equipment 0.9% | | | | |
| | 7,096,000 | | | AK Medical Holdings Ltd. (China) | | | 3,905,085 | |
| | | | | | | | |
| | |
| | | | Health Care Facilities 1.0% | | | | |
| | 10,980,379 | | | Cleopatra Hospital* (Egypt) | | | 4,060,576 | |
| | | | | | | | |
| | |
| | | | Health Care Services 0.9% | | | | |
| | 255,177 | | | Dr. Lal PathLabs Ltd. (India) | | | 3,821,669 | |
| | | | | | | | |
| | |
| | | | Health Care Supplies 2.6% | | | | |
| | 946,875 | | | Advanced Medical Solutions Group plc (United Kingdom) | | | 3,903,258 | |
| | 1,303,464 | | | Nanosonics Ltd.* (Australia) | | | 4,035,286 | |
| | 3,696,900 | | | Riverstone Holdings Ltd. (Singapore) | | | 2,973,342 | |
| | | | | | | | |
| | | | 10,911,886 | |
| | | | | | | | |
| | |
| | | | Health Care Technology 5.6% | | | | |
| | 151,307 | | | Craneware plc (United Kingdom) | | | 4,788,795 | |
| | 99,198 | | | Nexus AG (Germany) | | | 2,637,227 | |
| | 1,221,333 | | | Pro Medicus Ltd. (Australia) | | | 12,834,666 | |
| | 262,144 | | | RaySearch Laboratories AB* (Sweden) | | | 2,923,895 | |
| | | | | | | | |
| | | | 23,184,583 | |
| | | | | | | | |
| | |
| | | | Home Furnishing Retail 0.4% | | | | |
| | 438,322 | | | Nick Scali Ltd. (Australia) | | | 1,764,676 | |
| | | | | | | | |
| | |
| | | | Home Improvement Retail 2.5% | | | | |
| | 3,984,055 | | | Italtile Ltd. (South Africa) | | | 3,727,609 | |
| | 52,787,300 | | | PT Ace Hardware Indonesia Tbk (Indonesia) | | | 6,598,413 | |
| | | | | | | | |
| | | | 10,326,022 | |
| | | | | | | | |
| | |
| | | | Human Resource & Employment Services 2.1% | | | | |
| | 59,588 | | | en-japan, Inc. (Japan) | | | 1,731,240 | |
| | 234,262 | | | SMS Co. Ltd. (Japan) | | | 4,225,298 | |
| | 128,400 | | | UT Group Co. Ltd. (Japan) | | | 2,938,035 | |
| | | | | | | | |
| | | | 8,894,573 | |
| | | | | | | | |
54
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Interactive Media & Services 2.7% | | | | |
| | 5,036 | | | Atrae, Inc.* (Japan) | | $ | 176,076 | |
| | 128,900 | | | Itokuro, Inc.* (Japan) | | | 3,558,910 | |
| | 40,400 | | | Wantedly, Inc.* (Japan) | | | 1,791,627 | |
| | 16,043 | | | XING SE (Germany) | | | 5,551,840 | |
| | | | | | | | |
| | | | 11,078,453 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 6.0% | | | | |
| | 558,706 | | | On the Beach Group plc (United Kingdom) | | | 3,190,905 | |
| | 273,418 | | | Open Door, Inc.* (Japan) | | | 8,289,132 | |
| | 817,570 | | | Webjet Ltd. (Australia) | | | 8,446,499 | |
| | 333,221 | | | Yume No Machi Souzou Iinkai Co. Ltd. (Japan) | | | 4,783,493 | |
| | | | | | | | |
| | | | 24,710,029 | |
| | | | | | | | |
| | |
| | | | Internet Services & Infrastructure 0.6% | | | | |
| | 26,836 | | | Cafe24 Corp.* (Korea) | | | 2,553,333 | |
| | | | | | | | |
| | |
| | | | Investment Banking & Brokerage 2.4% | | | | |
| | 206,596 | | | HUB24 Ltd. (Australia) | | | 2,031,704 | |
| | 110,709 | | | M&A Capital Partners Co. Ltd.* (Japan) | | | 5,034,498 | |
| | 135,800 | | | Strike Co. Ltd. (Japan) | | | 2,793,684 | |
| | | | | | | | |
| | | | 9,859,886 | |
| | | | | | | | |
| | |
| | | | IT Consulting & Other Services 1.9% | | | | |
| | 233,971 | | | Appen Ltd. (Australia) | | | 3,701,400 | |
| | 58,505 | | | Aubay (France) | | | 2,077,126 | |
| | 17,786 | | | Avant Corp. (Japan) | | | 250,830 | |
| | 188,109 | | | eWork Group AB (Sweden) | | | 1,881,637 | |
| | | | | | | | |
| | | | 7,910,993 | |
| | | | | | | | |
| | |
| | | | Life Sciences Tools & Services 0.7% | | | | |
| | 78,830 | | | Biotage AB (Sweden) | | | 1,003,891 | |
| | 1,029,021 | | | Horizon Discovery Group plc* (United Kingdom) | | | 1,996,969 | |
| | | | | | | | |
| | | | 3,000,860 | |
| | | | | | | | |
| | |
| | | | Oil & Gas Equipment & Services 1.7% | | | | |
| | 583,959 | | | Computer Modelling Group Ltd. (Canada) | | | 2,687,430 | |
| | 663,361 | | | Spectrum ASA (Norway) | | | 4,230,153 | |
| | | | | | | | |
| | | | 6,917,583 | |
| | | | | | | | |
| | |
| | | | Other Diversified Financial Services 2.3% | | | | |
| | 46,464 | | | Hypoport AG* (Germany) | | | 9,329,660 | |
| | | | | | | | |
| | |
| | | | Packaged Foods & Meats 4.7% | | | | |
| | 2,003,120 | | | Vitasoy International Holdings Ltd. (China) | | | 9,696,694 | |
| | 2,214,000 | | | Yihai International Holding Ltd. (China) | | | 9,857,298 | |
| | | | | | | | |
| | | | 19,553,992 | |
| | | | | | | | |
| | |
| | | | Personal Products 3.0% | | | | |
| | 244,665 | | | Jamieson Wellness, Inc. (Canada) | | | 3,447,481 | |
| | 543,629 | | | Sarantis S.A. (Greece) | | | 4,293,105 | |
| | 343,474 | | | TCI Co. Ltd. (Taiwan) | | | 4,702,910 | |
| | | | | | | | |
| | | | 12,443,496 | |
| | | | | | | | |
| | |
| | | | Property & Casualty Insurance 1.5% | | | | |
| | 2,589,300 | | | Qualitas Controladora S.A.B. de C.V. (Mexico) | | | 6,368,449 | |
| | | | | | | | |
| | |
| | | | Research & Consulting Services 1.7% | | | | |
| | 40,458 | | | Akka Technologies (France) | | | 2,750,257 | |
| | 257,000 | | | IR Japan Holdings Ltd. (Japan) | | | 4,208,743 | |
| | | | | | | | |
| | | | 6,959,000 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Restaurants 0.6% | | | | |
| | 141,500 | | | Arcland Service Holdings Co. Ltd. (Japan) | | $ | 2,590,485 | |
| | 630,045 | | | Patisserie Holdings plc* *** (United Kingdom) | | | 8,206 | |
| | | | | | | | |
| | | | 2,598,691 | |
| | | | | | | | |
| | |
| | | | Semiconductor Equipment 1.7% | | | | |
| | 332,900 | | | Japan Material Co. Ltd. (Japan) | | | 4,073,016 | |
| | 200,000 | | | Machvision, Inc. (Taiwan) | | | 2,822,797 | |
| | | | | | | | |
| | | | 6,895,813 | |
| | | | | | | | |
| | |
| | | | Semiconductors 2.0% | | | | |
| | 158,000 | | | ASPEED Technology, Inc. (Taiwan) | | | 3,619,279 | |
| | 85,270 | | | LEENO Industrial, Inc. (Korea) | | | 4,484,732 | |
| | | | | | | | |
| | | | 8,104,011 | |
| | | | | | | | |
| | |
| | | | Specialized Finance 0.1% | | | | |
| | 23,245 | | | eGuarantee, Inc. (Japan) | | | 231,758 | |
| | | | | | | | |
| | |
| | | | Systems Software 2.3% | | | | |
| | 50,200 | | | Digital Arts, Inc. (Japan) | | | 4,099,161 | |
| | 270,669 | | | Minwise Co. Ltd. (Korea) | | | 5,257,908 | |
| | | | | | | | |
| | | | 9,357,069 | |
| | | | | | | | |
| | |
| | | | Technology Hardware, Storage & Peripherals 0.7% | | | | |
| | 57,241 | | | MGI Digital Graphic Technology* (France) | | | 2,960,086 | |
| | | | | | | | |
| | |
| | | | Thrifts & Mortgage Finance 2.1% | | | | |
| | 291,446 | | | Aavas Financiers Ltd.* (India) | | | 4,847,617 | |
| | 78,690 | | | Equitable Group, Inc. (Canada) | | | 3,811,579 | |
| | | | | | | | |
| | | | 8,659,196 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $281,897,406) | | | 394,752,151 | |
| | | | | | | | |
| | |
Principal
Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 4.6% | | | | |
| | |
| | | | Repurchase Agreement 4.6% | | | | |
| | $18,950,264 | | | Repurchase Agreement dated 3/29/19, 0.50% due 4/1/19 with Fixed Income Clearing Corp. collateralized by $19,205,000 of United States Treasury Notes 2.375% due 3/15/22; value: $19,330,313; repurchase proceeds: $18,951,053 (cost $18,950,264) | | $ | 18,950,264 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $18,950,264) | | | 18,950,264 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $300,847,670) 100.0%§ | | | 413,702,415 | |
| | |
| | | | Liabilities less Other Assets (<0.1%) | | | (137,556 | ) |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 413,564,859 | |
| | | | | | | | |
| |
| | | | *Non-income producing. ***Security was fair valued under procedures adopted by the Board of Trustees (see Note 12). §The aggregate amount of foreign securities fair valued pursuant to a systematic valuation model as a percent of net assets was 1.84%. See Notes to Financial Statements. | |
55
| | |
| WASATCH INTERNATIONAL OPPORTUNITIES FUND(WAIOX / WIIOX) | | MARCH 31, 2019 (UNAUDITED) |
|
|
|
Schedule of Investments(continued)
At March 31, 2019, Wasatch International Opportunities Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
Australia | | | | 8.3 | |
Canada | | | | 2.5 | |
China | | | | 6.2 | |
Denmark | | | | 0.8 | |
Egypt | | | | 1.0 | |
France | | | | 3.5 | |
Germany | | | | 5.4 | |
Greece | | | | 1.1 | |
India | | | | 10.9 | |
Indonesia | | | | 1.7 | |
Israel | | | | 0.9 | |
Italy | | | | 1.7 | |
Japan | | | | 22.9 | |
Korea | | | | 3.5 | |
Malaysia | | | | 1.7 | |
Mexico | | | | 2.8 | |
Norway | | | | 1.5 | |
Pakistan | | | | 0.1 | |
Philippines | | | | 2.3 | |
Singapore | | | | 1.4 | |
South Africa | | | | 0.9 | |
Sweden | | | | 4.2 | |
Taiwan | | | | 6.2 | |
Thailand | | | | 1.1 | |
United Kingdom | | | | 7.4 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
56
| | |
| WASATCH MICRO CAP FUND(WMICX) | | MARCH 31, 2019 (UNAUDITED) |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 98.8% | | | | |
| | |
| | | | Alternative Carriers 2.0% | | | | |
| | 133,376 | | | Bandwidth, Inc., Class A* | | $ | 8,930,857 | |
| | | | | | | | |
| | |
| | | | Apparel Retail 1.0% | | | | |
| | 156,715 | | | Boot Barn Holdings, Inc.* | | | 4,613,690 | |
| | | | | | | | |
| | |
| | | | Apparel, Accessories & Luxury Goods 1.1% | | | | |
| | 288,821 | | | Superior Group of Cos., Inc. | | | 4,800,205 | |
| | | | | | | | |
| | |
| | | | Application Software 8.1% | | | | |
| | 139,029 | | | Digimarc Corp.* | | | 4,362,730 | |
| | 64,600 | | | Esker S.A. (France) | | | 4,942,118 | |
| | 135,017 | | | Five9, Inc.* | | | 7,132,948 | |
| | 610,000 | | | Fortnox AB (Sweden) | | | 6,167,382 | |
| | 64,828 | | | Globant S.A.* (Argentina) | | | 4,628,719 | |
| | 207,680 | | | Upland Software, Inc.* | | | 8,797,325 | |
| | | | | | | | |
| | | | 36,031,222 | |
| | | | | | | | |
| | |
| | | | Asset Management & Custody Banks 0.5% | | | | |
| | 800,000 | | | Tatton Asset Management plc (United Kingdom) | | | 2,229,794 | |
| | | | | | | | |
| | |
| | | | Biotechnology 6.3% | | | | |
| | 217,286 | | | ChemoCentryx, Inc.* | | | 3,018,102 | |
| | 343,634 | | | Cytokinetics, Inc.* | | | 2,779,999 | |
| | 98,439 | | | Esperion Therapeutics, Inc.* | | | 3,952,326 | |
| | 41,011 | | | Exact Sciences Corp.* | | | 3,552,373 | |
| | 249,116 | | | Flexion Therapeutics, Inc.* | | | 3,108,968 | |
| | 622,873 | | | Inovio Pharmaceuticals, Inc.* | | | 2,323,316 | |
| | 165,612 | | | MacroGenics, Inc.* | | | 2,977,704 | |
| | 478,490 | | | Sangamo Therapeutics, Inc.* | | | 4,564,794 | |
| | 829,394 | | | Selecta Biosciences, Inc.* | | | 1,965,664 | |
| | | | | | | | |
| | | | 28,243,246 | |
| | | | | | | | |
| | |
| | | | Construction & Engineering 1.8% | | | | |
| | 623,957 | | | Construction Partners, Inc., Class A* ‡‡ | | | 7,967,931 | |
| | | | | | | | |
| | |
| | | | Department Stores 2.2% | | | | |
| | 258,292 | | | V-Mart Retail Ltd. (India) | | | 9,985,116 | |
| | | | | | | | |
| | |
| | | | Diversified Banks 1.1% | | | | |
| | 1,607,909 | | | City Union Bank Ltd. (India) | | | 4,746,552 | |
| | | | | | | | |
| | |
| | | | Diversified Support Services 1.4% | | | | |
| | 313,300 | | | Japan Elevator Service Holdings Co. Ltd. (Japan) | | | 6,357,590 | |
| | | | | | | | |
| | |
| | | | Drug Retail 1.1% | | | | |
| | 200,000 | | | Qol Holdings Co. Ltd. (Japan) | | | 2,721,285 | |
| | 100,000 | | | Yakuodo Co. Ltd. (Japan) | | | 2,397,365 | |
| | | | | | | | |
| | | | 5,118,650 | |
| | | | | | | | |
| | |
| | | | Electronic Equipment & Instruments 3.9% | | | | |
| | 28,114 | | | Mesa Laboratories, Inc. | | | 6,480,277 | |
| | 248,433 | | | Napco Security Technologies, Inc.* | | | 5,152,501 | |
| | 266,590 | | | nLight, Inc.* | | | 5,939,625 | |
| | | | | | | | |
| | | | 17,572,403 | |
| | | | | | | | |
| | |
| | | | Electronic Manufacturing Services 1.8% | | | | |
| | 153,316 | | | Fabrinet* | | | 8,027,626 | |
| | | | | | | | |
| | |
| | | | Environmental & Facilities Services 1.5% | | | | |
| | 243,587 | | | Heritage-Crystal Clean, Inc.* | | | 6,686,463 | |
| | | | | | | | |
| | |
| | | | Food Distributors 1.0% | | | | |
| | 142,997 | | | Chefs’ Warehouse, Inc. (The)* | | | 4,440,057 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Health Care Distributors 0.9% | | | | |
| | 125,534 | | | PetIQ, Inc.* | | $ | 3,943,023 | |
| | | | | | | | |
| | |
| | | | Health Care Equipment 6.4% | | | | |
| | 158,062 | | | AtriCure, Inc.* | | | 4,234,481 | |
| | 187,662 | | | CryoLife, Inc.* | | | 5,474,100 | |
| | 767,398 | | | IRIDEX Corp.* ‡‡ | | | 3,499,335 | |
| | 217,253 | | | LeMaitre Vascular, Inc. | | | 6,734,843 | |
| | 135,438 | | | Tandem Diabetes Care, Inc.* | | | 8,600,313 | |
| | | | | | | | |
| | | | 28,543,072 | |
| | | | | | | | |
| | |
| | | | Health Care Supplies 1.5% | | | | |
| | 152,159 | | | OrthoPediatrics Corp.* | | | 6,729,992 | |
| | | | | | | | |
| | |
| | | | Health Care Technology 5.0% | | | | |
| | 84,059 | | | Inspire Medical Systems, Inc.* | | | 4,772,870 | |
| | 59,252 | | | Omnicell, Inc.* | | | 4,789,932 | |
| | 340,465 | | | Simulations Plus, Inc. | | | 7,187,216 | |
| | 95,787 | | | Tabula Rasa HealthCare, Inc.* | | | 5,404,302 | |
| | | | | | | | |
| | | | 22,154,320 | |
| | | | | | | | |
| | |
| | | | Heavy Electrical Equipment 1.5% | | | | |
| | 234,952 | | | TPI Composites, Inc.* | | | 6,724,326 | |
| | | | | | | | |
| | |
| | | | Home Furnishings 0.9% | | | | |
| | 145,390 | | | Lovesac Co. (The)* | | | 4,043,296 | |
| | | | | | | | |
| | |
| | | | Homebuilding 2.2% | | | | |
| | 95,803 | | | LGI Homes, Inc.* | | | 5,771,173 | |
| | 213,990 | | | Skyline Champion Corp. | | | 4,065,810 | |
| | | | | | | | |
| | | | 9,836,983 | |
| | | | | | | | |
| | |
| | | | Human Resource & Employment Services 1.3% | | | | |
| | 251,100 | | | UT Group Co. Ltd. (Japan) | | | 5,745,643 | |
| | | | | | | | |
| | |
| | | | Industrial Machinery 7.5% | | | | |
| | 166,478 | | | Altra Industrial Motion Corp. | | | 5,169,142 | |
| | 616,621 | | | Elgi Equipments Ltd. (India) | | | 2,201,677 | |
| | 108,044 | | | Kadant, Inc. | | | 9,503,550 | |
| | 388,122 | | | Kornit Digital Ltd.* (Israel) | | | 9,237,304 | |
| | 161,139 | | | Sun Hydraulics Corp. | | | 7,494,575 | |
| | | | | | | | |
| | | | 33,606,248 | |
| | | | | | | | |
| | |
| | | | Insurance Brokers 2.2% | | | | |
| | 177,233 | | | Goosehead Insurance, Inc., Class A | | | 4,941,256 | |
| | 176,761 | | | Health Insurance Innovations, Inc., Class A* | | | 4,740,730 | |
| | | | | | | | |
| | | | 9,681,986 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 3.8% | | | | |
| | 249,768 | | | Duluth Holdings, Inc., Class B* | | | 5,954,469 | |
| | 399,361 | | | Medallia, Inc.* *** † | | | 5,990,415 | |
| | 166,800 | | | Open Door, Inc.* (Japan) | | | 5,056,826 | |
| | | | | | | | |
| | | | 17,001,710 | |
| | | | | | | | |
| | |
| | | | Internet Services & Infrastructure 2.5% | | | | |
| | 1,631,733 | | | Limelight Networks, Inc.* | | | 5,270,497 | |
| | 45,722 | | | Twilio, Inc., Class A* | | | 5,906,368 | |
| | | | | | | | |
| | | | 11,176,865 | |
| | | | | | | | |
| | |
| | | | Investment Banking & Brokerage 1.0% | | | | |
| | 94,000 | | | M&A Capital Partners Co. Ltd.* (Japan) | | | 4,274,655 | |
| | | | | | | | |
| | |
| | | | Leisure Products 1.5% | | | | |
| | 298,461 | | | MasterCraft Boat Holdings, Inc.* | | | 6,736,265 | |
| | | | | | | | |
| | |
| | | | Oil & Gas Equipment & Services 0.9% | | | | |
| | 256,613 | | | Solaris Oilfield Infrastructure, Inc., Class A | | | 4,218,718 | |
| | | | | | | | |
57
| | |
| WASATCH MICRO CAP FUND(WMICX) | | MARCH 31, 2019 (UNAUDITED) |
|
|
|
Schedule of Investments(continued)
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Oil & Gas Exploration & Production 1.4% | | | | |
| | 2,524,023 | | | Abraxas Petroleum Corp.* | | $ | 3,155,029 | |
| | 795,192 | | | Lonestar Resources US, Inc., Class A* | | | 3,188,720 | |
| | | | | | | | |
| | | | 6,343,749 | |
| | | | | | | | |
| | |
| | | | Packaged Foods & Meats 2.1% | | | | |
| | 226,577 | | | Freshpet, Inc.* | | | 9,581,941 | |
| | | | | | | | |
| | |
| | | | Personal Products 0.8% | | | | |
| | 42,178 | | | USANA Health Sciences, Inc.* | | | 3,537,469 | |
| | | | | | | | |
| | |
| | | | Pharmaceuticals 0.7% | | | | |
| | 263,301 | | | Intra-Cellular Therapies, Inc.* | | | 3,207,006 | |
| | | | | | | | |
| | |
| | | | Regional Banks 3.2% | | | | |
| | 226,140 | | | CBTX, Inc. | | | 7,342,766 | |
| | 117,638 | | | Metro Bank plc* (United Kingdom) | | | 1,161,389 | |
| | 221,094 | | | People’s Utah Bancorp | | | 5,830,249 | |
| | | | | | | | |
| | | | 14,334,404 | |
| | | | | | | | |
| | |
| | | | Research & Consulting Services 1.0% | | | | |
| | 273,000 | | | IR Japan Holdings Ltd. (Japan) | | | 4,470,766 | |
| | | | | | | | |
| | |
| | | | Restaurants 1.3% | | | | |
| | 252,983 | | | Chuy’s Holdings, Inc.* | | | 5,760,423 | |
| | | | | | | | |
| | |
| | | | Semiconductors 4.4% | | | | |
| | 119,509 | | | Ambarella, Inc.* | | | 5,162,789 | |
| | 136,419 | | | Inphi Corp.* | | | 5,966,967 | |
| | 34,504 | | | LEENO Industrial, Inc. (Korea) | | | 1,814,720 | |
| | 257,654 | | | MaxLinear, Inc., Class A* | | | 6,577,906 | |
| | | | | | | | |
| | | | 19,522,382 | |
| | | | | | | | |
| | |
| | | | Specialized Consumer Services 1.0% | | | | |
| | 347,147 | | | Select Interior Concepts, Inc., Class A* | | | 4,321,980 | |
| | | | | | | | |
| | |
| | | | Systems Software 5.9% | | | | |
| | 79,685 | | | CyberArk Software Ltd.* (Israel) | | | 9,486,499 | |
| | 101,000 | | | Douzone Bizon Co. Ltd. (Korea) | | | 4,146,419 | |
| | 157,784 | | | Rapid7, Inc.* | | | 7,985,448 | |
| | 81,764 | | | Varonis Systems, Inc.* | | | 4,875,588 | |
| | | | | | | | |
| | | | 26,493,954 | |
| | | | | | | | |
| | |
| | | | Technology Hardware, Storage & Peripherals 0.7% | | | | |
| | 757,927 | | | USA Technologies, Inc.* | | | 3,145,397 | |
| | | | | | | | |
| | |
| | | | Thrifts & Mortgage Finance 0.8% | | | | |
| | 78,507 | | | Equitable Group, Inc. (Canada) | | | 3,802,715 | |
| | | | | | | | |
| | |
| | | | Trading Companies & Distributors 1.6% | | | | |
| | 321,455 | | | Transcat, Inc.* | | | 7,387,036 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $344,903,067) | | | 442,077,726 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | PREFERRED STOCKS 0.6% | | | | |
| | |
| | | | Internet & Direct Marketing Retail 0.6% | | | | |
| | 183,333 | | | Medallia, Inc., Series F* *** † | | $ | 2,749,995 | |
| | | | | | | | |
| | |
| | | | Total Preferred Stocks
(cost $2,749,995) | | | 2,749,995 | |
| | | | | | | | |
| | |
Principal
Amount | | | | | Value | |
| | | | SHORT-TERM INVESTMENTS 0.9% | | | | |
| | |
| | | | Repurchase Agreement 0.9% | | | | |
| | $4,054,338 | | | Repurchase Agreement dated 3/29/19,
0.50% due 4/1/19 with Fixed Income
Clearing Corp. collateralized by $4,110,000
of United States Treasury Notes 2.375%
due 3/15/22; value: $4,136,818; repurchase
proceeds: $4,054,507 (cost $4,054,338) | | $ | 4,054,338 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $4,054,338) | | | 4,054,338 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $351,707,400) 100.3% | | | 448,882,059 | |
| | |
| | | | Liabilities less Other Assets (0.3%) | | | (1,469,853 | ) |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 447,412,206 | |
| | | | | | | | |
| |
| | | | *Non-income producing. ***Security was fair valued under procedures adopted by the Board of Trustees (see Note 12). †Security purchased in a private placement transaction or under Rule 144A of the Securities Act of 1933 (see Note 9). ‡‡Affiliated company (see Note 8). See Notes to Financial Statements. | |
At March 31, 2019, Wasatch Micro Cap Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
Argentina | | | | 1.0 | |
Canada | | | | 0.9 | |
France | | | | 1.1 | |
India | | | | 3.8 | |
Israel | | | | 4.2 | |
Japan | | | | 7.0 | |
Korea | | | | 1.3 | |
Sweden | | | | 1.4 | |
United Kingdom | | | | 0.8 | |
United States | | | | 78.5 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
58
| | |
| WASATCH MICRO CAP VALUE FUND(WAMVX) | | MARCH 31, 2019 (UNAUDITED) |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 95.0% | | | | |
| | |
| | | | Air Freight & Logistics 1.6% | | | | |
| | 623,000 | | | Radiant Logistics, Inc.* | | $ | 3,924,900 | |
| | | | | | | | |
| | |
| | | | Airlines 0.8% | | | | |
| | 15,000 | | | Allegiant Travel Co. | | | 1,942,050 | |
| | | | | | | | |
| | |
| | | | Alternative Carriers 1.9% | | | | |
| | 202,000 | | | Gamma Communications plc (United Kingdom) | | | 2,573,067 | |
| | 342,000 | | | ORBCOMM, Inc.* | | | 2,318,760 | |
| | | | | | | | |
| | | | | | | 4,891,827 | |
| | | | | | | | |
| | |
| | | | Apparel Retail 0.4% | | | | |
| | 400,000 | | | RTW RetailWinds, Inc.* | | | 960,000 | |
| | | | | | | | |
| | |
| | | | Apparel, Accessories & Luxury Goods 0.8% | | | | |
| | 115,000 | | | Superior Group of Cos., Inc. | | | 1,911,300 | |
| | | | | | | | |
| | |
| | | | Application Software 8.9% | | | | |
| | 43,000 | | | Ebix, Inc. | | | 2,122,910 | |
| | 231,500 | | | eGain Corp.* | | | 2,419,175 | |
| | 37,000 | | | Esker S.A. (France) | | | 2,830,624 | |
| | 47,000 | | | Everbridge, Inc.* | | | 3,525,470 | |
| | 54,000 | | | Globant S.A.* (Argentina) | | | 3,855,600 | |
| | 90,000 | | | Miroku Jyoho Service Co. Ltd. (Japan) | | | 2,307,047 | |
| | 229,000 | | | SharpSpring, Inc.* | | | 3,668,580 | |
| | 260,000 | | | Telenav, Inc.* | | | 1,578,200 | |
| | | | | | | | |
| | | | | | | 22,307,606 | |
| | | | | | | | |
| | |
| | | | Asset Management & Custody Banks 2.4% | | | | |
| | 850,000 | | | Fiducian Group Ltd. (Australia) | | | 2,897,003 | |
| | 69,000 | | | Hamilton Lane, Inc., Class A | | | 3,007,020 | |
| | | | | | | | |
| | | | | | | 5,904,023 | |
| | | | | | | | |
| | |
| | | | Biotechnology 1.8% | | | | |
| | 175,000 | | | Cytokinetics, Inc.* | | | 1,415,750 | |
| | 182,000 | | | Sangamo Therapeutics, Inc.* | | | 1,736,280 | |
| | 631,000 | | | Selecta Biosciences, Inc.* | | | 1,495,470 | |
| | | | | | | | |
| | | | | | | 4,647,500 | |
| | | | | | | | |
| | |
| | | | Building Products 0.9% | | | | |
| | 52,000 | | | Patrick Industries, Inc.* | | | 2,356,640 | |
| | | | | | | | |
| | |
| | | | Communications Equipment 1.3% | | | | |
| | 265,000 | | | Digi International, Inc.* | | | 3,357,550 | |
| | | | | | | | |
| | |
| | | | Construction & Engineering 2.9% | | | | |
| | 352,000 | | | Construction Partners, Inc., Class A* | | | 4,495,040 | |
| | 49,000 | | | NV5 Global, Inc.* | | | 2,908,640 | |
| | | | | | | | |
| | | | | | | 7,403,680 | |
| | | | | | | | |
| | |
| | | | Consumer Electronics 0.7% | | | | |
| | 193,000 | | | ZAGG, Inc.* | | | 1,750,510 | |
| | | | | | | | |
| | |
| | | | Consumer Finance 0.7% | | | | |
| | 850,000 | | | Unifin Financiera S.A.B. de C.V. SOFOM ENR (Mexico) | | | 1,831,790 | |
| | | | | | | | |
| | |
| | | | Data Processing & Outsourced Services 1.2% | | | | |
| | 129,000 | | | i3 Verticals, Inc., Class A* | | | 3,098,580 | |
| | | | | | | | |
| | |
| | | | Diversified Banks 1.2% | | | | |
| | 1,000,000 | | | City Union Bank Ltd. (India) | | | 2,952,003 | |
| | | | | | | | |
| | |
| | | | Diversified Support Services 1.0% | | | | |
| | 1,450,000 | | | Johnson Service Group plc (United Kingdom) | | | 2,625,087 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Electronic Equipment & Instruments 1.7% | | | | |
| | 203,000 | | | Napco Security Technologies, Inc.* | | $ | 4,210,220 | |
| | | | | | | | |
| | |
| | | | Electronic Manufacturing Services 1.8% | | | | |
| | 86,000 | | | Fabrinet* | | | 4,502,960 | |
| | | | | | | | |
| | |
| | | | Financial Exchanges & Data 0.4% | | | | |
| | 350,000 | | | Infront ASA (Norway) | | | 933,339 | |
| | | | | | | | |
| | |
| | | | Health Care Distributors 2.0% | | | | |
| | 3,300,000 | | | Ibnsina Pharma S.A.E.* (Egypt) | | | 2,410,364 | |
| | 85,000 | | | PetIQ, Inc.* | | | 2,669,850 | |
| | | | | | | | |
| | | | | | | 5,080,214 | |
| | | | | | | | |
| | |
| | | | Health Care Equipment 4.1% | | | | |
| | 80,000 | | | AtriCure, Inc.* | | | 2,143,200 | |
| | 486,000 | | | IRIDEX Corp.* | | | 2,216,160 | |
| | 224,000 | | | Neuronetics, Inc.* | | | 3,416,000 | |
| | 170,000 | | | RA Medical Systems, Inc.* | | | 578,000 | |
| | 35,000 | | | Tactile Systems Technology, Inc.* | | | 1,845,200 | |
| | | | | | | | |
| | | | | | | 10,198,560 | |
| | | | | | | | |
| | |
| | | | Health Care Facilities 1.1% | | | | |
| | 53,000 | | | Ensign Group, Inc. (The) | | | 2,713,070 | |
| | | | | | | | |
| | |
| | | | Health Care Services 2.3% | | | | |
| | 30,000 | | | LHC Group, Inc.* | | | 3,325,800 | |
| | 512,000 | | | Viemed Healthcare, Inc.* (Canada) | | | 2,524,848 | |
| | | | | | | | |
| | | | | | | 5,850,648 | |
| | | | | | | | |
| | |
| | | | Health Care Supplies 1.5% | | | | |
| | 83,000 | | | OrthoPediatrics Corp.* | | | 3,671,090 | |
| | | | | | | | |
| | |
| | | | Health Care Technology 3.4% | | | | |
| | 122,000 | | | Nexus AG (Germany) | | | 3,243,429 | |
| | 31,000 | | | Omnicell, Inc.* | | | 2,506,040 | |
| | 222,533 | | | OptimizeRx Corp.* | | | 2,830,620 | |
| | | | | | | | |
| | | | | | | 8,580,089 | |
| | | | | | | | |
| | |
| | | | Heavy Electrical Equipment 1.3% | | | | |
| | 117,175 | | | TPI Composites, Inc.* | | | 3,353,548 | |
| | | | | | | | |
| | |
| | | | Home Furnishing Retail 1.2% | | | | |
| | 64,215 | | | Sleep Number Corp.* | | | 3,018,105 | |
| | | | | | | | |
| | |
| | | | Home Furnishings 1.1% | | | | |
| | 102,000 | | | Lovesac Co. (The)* | | | 2,836,620 | |
| | | | | | | | |
| | |
| | | | Homebuilding 2.4% | | | | |
| | 43,000 | | | LGI Homes, Inc.* | | | 2,590,320 | |
| | 176,000 | | | Skyline Champion Corp. | | | 3,344,000 | |
| | | | | | | | |
| | | | | | | 5,934,320 | |
| | | | | | | | |
| | |
| | | | Human Resource & Employment Services 2.2% | | | | |
| | 112,000 | | | BG Staffing, Inc. | | | 2,446,080 | |
| | 139,000 | | | UT Group Co. Ltd. (Japan) | | | 3,180,583 | |
| | | | | | | | |
| | | | | | | 5,626,663 | |
| | | | | | | | |
| | |
| | | | Industrial Machinery 3.0% | | | | |
| | 24,000 | | | John Bean Technologies Corp. | | | 2,205,360 | |
| | 31,000 | | | Kadant, Inc. | | | 2,726,760 | |
| | 56,000 | | | Sun Hydraulics Corp. | | | 2,604,560 | |
| | | | | | | | |
| | | | 7,536,680 | |
| | | | | | | | |
| | |
| | | | Industrial REITs 1.2% | | | | |
| | 235,000 | | | Monmouth Real Estate Investment Corp. | | | 3,097,300 | |
| | | | | | | | |
59
| | |
| WASATCH MICRO CAP VALUE FUND(WAMVX) | | |
|
|
|
Schedule of Investments(continued)
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Insurance Brokers 2.2% | | | | |
| | 118,000 | | | Goosehead Insurance, Inc., Class A | | $ | 3,289,840 | |
| | 79,000 | | | Health Insurance Innovations, Inc., Class A* | | | 2,118,780 | |
| | | | | | | | |
| | | | 5,408,620 | |
| | | | | | | | |
| | |
| | | | Integrated Telecommunication Services 1.3% | | | | |
| | 240,000 | | | Ooma, Inc.* | | | 3,177,600 | |
| | | | | | | | |
| | |
| | | | Internet Services & Infrastructure 1.0% | | | | |
| | 30,000 | | | Tucows, Inc., Class A* | | | 2,435,400 | |
| | | | | | | | |
| | |
| | | | IT Consulting & Other Services 2.4% | | | | |
| | 114,238 | | | Endava plc, ADR* (United Kingdom) | | | 3,141,545 | |
| | 186,000 | | | Hackett Group, Inc. (The) | | | 2,938,800 | |
| | | | | | | | |
| | | | 6,080,345 | |
| | | | | | | | |
| | |
| | | | Mortgage REITs 1.7% | | | | |
| | 333,262 | | | Arbor Realty Trust, Inc. | | | 4,322,408 | |
| | | | | | | | |
| | |
| | | | Oil & Gas Equipment & Services 1.3% | | | | |
| | 196,000 | | | Solaris Oilfield Infrastructure, Inc., Class A | | | 3,222,240 | |
| | | | | | | | |
| | |
| | | | Oil & Gas Exploration & Production 1.6% | | | | |
| | 300,000 | | | Lonestar Resources US, Inc., Class A* | | | 1,203,000 | |
| | 225,000 | | | Magnolia Oil & Gas Corp.* | | | 2,700,000 | |
| | | | | | | | |
| | | | 3,903,000 | |
| | | | | | | | |
| | |
| | | | Packaged Foods & Meats 3.4% | | | | |
| | 118,000 | | | Freshpet, Inc.* | | | 4,990,220 | |
| | 790,000 | | | Yihai International Holding Ltd. (China) | | | 3,517,284 | |
| | | | | | | | |
| | | | 8,507,504 | |
| | | | | | | | |
| | |
| | | | Personal Products 0.9% | | | | |
| | 291,000 | | | Sarantis S.A. (Greece) | | | 2,298,062 | |
| | | | | | | | |
| | |
| | | | Pharmaceuticals 0.8% | | | | |
| | 243,000 | | | Cocrystal Pharma, Inc.* *** † | | | 597,780 | |
| | 109,000 | | | Intra-Cellular Therapies, Inc.* | | | 1,327,620 | |
| | | | | | | | |
| | | | 1,925,400 | |
| | | | | | | | |
| | |
| | | | Property & Casualty Insurance 1.0% | | | | |
| | 167,000 | | | Kingstone Cos., Inc. | | | 2,461,580 | |
| | | | | | | | |
| | |
| | | | Regional Banks 5.3% | | | | |
| | 170,463 | | | Capital Bancorp, Inc.* | | | 1,980,780 | |
| | 166,925 | | | Esquire Financial Holdings, Inc.* | | | 3,799,213 | |
| | 99,000 | | | Investar Holding Corp. | | | 2,248,290 | |
| | 136,000 | | | SmartFinancial, Inc.* | | | 2,571,760 | |
| | 78,000 | | | Sound Financial Bancorp, Inc. | | | 2,648,100 | |
| | | | | | | | |
| | | | 13,248,143 | |
| | | | | | | | |
| | |
| | | | Research & Consulting Services 1.0% | | | | |
| | 160,000 | | | IR Japan Holdings Ltd. (Japan) | | | 2,620,229 | |
| | | | | | | | |
| | |
| | | | Semiconductors 2.7% | | | | |
| | 73,000 | | | Inphi Corp.* | | | 3,193,020 | |
| | 140,000 | | | MaxLinear, Inc., Class A* | | | 3,574,200 | |
| | | | | | | | |
| | | | 6,767,220 | |
| | | | | | | | |
| | |
| | | | Specialized Consumer Services 1.0% | | | | |
| | 199,708 | | | Select Interior Concepts, Inc., Class A* | | | 2,486,365 | |
| | | | | | | | |
| | |
| | | | Specialty Chemicals 0.9% | | | | |
| | 124,000 | | | Ferro Corp.* | | | 2,347,320 | |
| | | | | | | | |
| | |
| | | | Systems Software 1.0% | | | | |
| | 130,000 | | | Minwise Co. Ltd. (Korea) | | | 2,525,328 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Technology Hardware, Storage & Peripherals 1.7% | | | | |
| | 725,000 | | | One Stop Systems, Inc.* ‡‡ | | $ | 1,479,000 | |
| | 682,000 | | | USA Technologies, Inc.* | | | 2,830,300 | |
| | | | | | | | |
| | | | 4,309,300 | |
| | | | | | | | |
| | |
| | | | Thrifts & Mortgage Finance 2.0% | | | | |
| | 90,000 | | | Axos Financial, Inc.* | | | 2,606,400 | |
| | 310,000 | | | Mortgage Advice Bureau Holdings Ltd. (United Kingdom) | | | 2,361,992 | |
| | | | | | | | |
| | | | 4,968,392 | |
| | | | | | | | |
| | |
| | | | Trading Companies & Distributors 1.8% | | | | |
| | 283,000 | | | Hardwoods Distribution, Inc. (Canada) | | | 2,689,490 | |
| | 32,000 | | | SiteOne Landscape Supply, Inc.* | | | 1,828,800 | |
| | | | | | | | |
| | | | 4,518,290 | |
| | | | | | | | |
| | |
| | | | Water Utilities 0.8% | | | | |
| | 198,233 | | | Global Water Resources, Inc. | | | 1,944,666 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $183,264,538) | | | 238,485,884 | |
| | | | | | | | |
| | |
| | | | CONVERTIBLE PREFERRED STOCKS 0.8% | | | | |
| | |
| | | | Oil & Gas Refining & Marketing 0.8% | | | | |
| | 616,494 | | | Vertex Energy, Inc., Pfd., 6.00% PIK, Series B*** † | | | 1,898,802 | |
| | | | | | | | |
| | |
| | | | Total Convertible Preferred Stocks
(cost $1,816,132) | | | 1,898,802 | |
| | | | | | | | |
| | |
| | | | RIGHTS 0.2% | | | | |
| | |
| | | | Pharmaceuticals 0.2% | | | | |
| | 1 | | | Acetylon Pharmaceuticals, Inc.* *** † | | | 391,628 | |
| | 1 | | | Acetylon Pharmaceuticals, Inc.* *** † | | | — | |
| | | | | | | | |
| | |
| | | | Total Rights
(cost $0) | | | 391,628 | |
| | | | | | | | |
| | |
| | | | LIMITED LIABILITY COMPANY MEMBERSHIP INTEREST 0.0% | | | | |
| | |
| | | | Pharmaceuticals 0.0% | | | | |
| | 50,528 | | | Regenacy Pharmaceuticals, LLC* *** † | | | 20,211 | |
| | | | | | | | |
| | |
| | | | Total Limited Liability Company Membership Interest
(cost $30,001) | | | 20,211 | |
| | | | | | | | |
| | |
| | | | WARRANTS 0.0% | | | | |
| | |
| | | | Oil & Gas Refining & Marketing 0.0% | | | | |
| | 250,000 | | | Vertex Energy, Inc., expiring 12/24/2020* *** † | | | 22,500 | |
| | | | | | | | |
| | |
| | | | Total Warrants
(cost $95,000) | | | 22,500 | |
| | | | | | | | |
60
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | |
Principal
Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 4.0% | | | | |
| | |
| | | | Repurchase Agreement 4.0% | | | | |
| | $10,052,067 | | | Repurchase Agreement dated 3/29/19, 0.50% due 4/1/19 with Fixed Income Clearing Corp. collateralized by $10,190,000 of United States Treasury Notes 2.375% due 3/15/22; value: $10,256,490; repurchase proceeds: $10,052,486 (cost $10,052,067) | | $ | 10,052,067 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $10,052,067) | | | 10,052,067 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $195,257,738) 100.0%§ | | | 250,871,092 | |
| | |
| | | | Other Assets less Liabilities <0.1% | | | 20,628 | |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 250,891,720 | |
| | | | | | | | |
| |
| | | | *Non-income producing. ***Security was fair valued under procedures adopted by the Board of Trustees (see Note 12). †Security purchased in a private placement transaction or under Rule 144A of the Securities Act of 1933 (see Note 9). ‡‡Affiliated company (see Note 8). §The aggregate amount of foreign securities fair valued pursuant to a systematic valuation model as a percent of net assets was 0.96%. ADR American Depositary Receipt. PIK Payment in kind. REIT Real Estate Investment Trust. See Notes to Financial Statements. | |
At March 31, 2019, Wasatch Micro Cap Value Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
Argentina | | | | 1.6 | |
Australia | | | | 1.2 | |
Canada | | | | 2.2 | |
China | | | | 1.5 | |
Egypt | | | | 1.0 | |
France | | | | 1.2 | |
Germany | | | | 1.3 | |
Greece | | | | 0.9 | |
India | | | | 1.2 | |
Japan | | | | 3.4 | |
Korea | | | | 1.0 | |
Mexico | | | | 0.8 | |
Norway | | | | 0.4 | |
United Kingdom | | | | 4.4 | |
United States | | | | 77.9 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
61
| | |
| WASATCH SMALL CAP GROWTH FUND(WAAEX / WIAEX) | | |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 97.8% | | | | |
| | |
| | | | Aerospace & Defense 3.7% | | | | |
| | 734,512 | | | HEICO Corp., Class A | | $ | 61,743,079 | |
| | | | | | | | |
| | |
| | | | Air Freight & Logistics 1.8% | | | | |
| | 22,829,736 | | | Aramex PJSC (United Arab Emirates) | | | 29,584,837 | |
| | | | | | | | |
| | |
| | | | Airlines 0.8% | | | | |
| | 106,117 | | | Allegiant Travel Co. | | | 13,738,968 | |
| | | | | | | | |
| | |
| | | | Application Software 15.0% | | | | |
| | 724,671 | | | DocuSign, Inc.* | | | 37,566,945 | |
| | 526,090 | | | Envestnet, Inc.* | | | 34,401,025 | |
| | 571,629 | | | Five9, Inc.* | | | 30,199,160 | |
| | 442,106 | | | Globant S.A.* (Argentina) | | | 31,566,368 | |
| | 194,449 | | | HubSpot, Inc.* | | | 32,319,368 | |
| | 450,878 | | | Paylocity Holding Corp.* | | | 40,213,809 | |
| | 533,810 | | | Zendesk, Inc.* | | | 45,373,850 | |
| | | | | | | | |
| | | | 251,640,525 | |
| | | | | | | | |
| | |
| | | | Automotive Retail 2.9% | | | | |
| | 564,672 | | | Monro, Inc. | | | 48,855,421 | |
| | | | | | | | |
| | |
| | | | Biotechnology 8.3% | | | | |
| | 1,910,468 | | | Abcam plc (United Kingdom) | | | 28,242,073 | |
| | 211,310 | | | Atara Biotherapeutics, Inc.* | | | 8,399,572 | |
| | 989,000 | | | ChemoCentryx, Inc.* | | | 13,737,210 | |
| | 1,153,665 | | | Cytokinetics, Inc.* | | | 9,333,150 | |
| | 433,453 | | | Denali Therapeutics, Inc.* | | | 10,064,779 | |
| | 212,807 | | | Esperion Therapeutics, Inc.* | | | 8,544,201 | |
| | 311,808 | | | Exact Sciences Corp.* | | | 27,008,809 | |
| | 362,824 | | | Flexion Therapeutics, Inc.* | | | 4,528,043 | |
| | 2,153,878 | | | Inovio Pharmaceuticals, Inc.* | | | 8,033,965 | |
| | 512,111 | | | MacroGenics, Inc.* | | | 9,207,756 | |
| | 1,288,714 | | | Sangamo Therapeutics, Inc.* | | | 12,294,332 | |
| | | | | | | | |
| | | | 139,393,890 | |
| | | | | | | | |
| | |
| | | | Building Products 2.3% | | | | |
| | 847,175 | | | AAON, Inc. | | | 39,122,541 | |
| | | | | | | | |
| | |
| | | | Data Processing & Outsourced Services 4.1% | | | | |
| | 489,090 | | | Euronet Worldwide, Inc.* | | | 69,739,343 | |
| | | | | | | | |
| | |
| | | | Diversified Support Services 3.8% | | | | |
| | 721,673 | | | Copart, Inc.* | | | 43,726,167 | |
| | 617,016 | | | Healthcare Services Group, Inc. | | | 20,355,358 | |
| | | | | | | | |
| | | | 64,081,525 | |
| | | | | | | | |
| | |
| | | | General Merchandise Stores 2.6% | | | | |
| | 507,537 | | | Ollie’s Bargain Outlet Holdings, Inc.* | | | 43,308,132 | |
| | | | | | | | |
| | |
| | | | Health Care Distributors 0.9% | | | | |
| | 466,163 | | | PetIQ, Inc.* | | | 14,642,180 | |
| | | | | | | | |
| | |
| | | | Health Care Equipment 3.6% | | | | |
| | 506,367 | | | Cantel Medical Corp. | | | 33,870,889 | |
| | 274,400 | | | Insulet Corp.* | | | 26,092,696 | |
| | | | | | | | |
| | | | 59,963,585 | |
| | | | | | | | |
| | |
| | | | Health Care Facilities 2.1% | | | | |
| | 676,679 | | | Ensign Group, Inc. (The) | | | 34,639,198 | |
| | | | | | | | |
| | |
| | | | Health Care Supplies 2.4% | | | | |
| | 710,502 | | | Neogen Corp.* | | | 40,775,710 | |
| | | | | | | | |
| | |
| | | | Home Improvement Retail 1.5% | | | | |
| | 609,912 | | | Floor & Decor Holdings, Inc., Class A* | | | 25,140,573 | |
| | | | | | | | |
| | |
| | | | Homebuilding 1.3% | | | | |
| | 366,512 | | | LGI Homes, Inc.* | | | 22,078,683 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Industrial Machinery 6.2% | | | | |
| | 676,974 | | | Barnes Group, Inc. | | $ | 34,803,233 | |
| | 338,326 | | | RBC Bearings, Inc.* | | | 43,024,918 | |
| | 567,934 | | | Sun Hydraulics Corp. | | | 26,414,610 | |
| | | | | | | | |
| | | | 104,242,761 | |
| | | | | | | | |
| | |
| | | | Insurance Brokers 0.9% | | | | |
| | 562,804 | | | Goosehead Insurance, Inc., Class A | | | 15,690,975 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 1.1% | | | | |
| | 121,842 | | | Wayfair, Inc., Class A* | | | 18,087,445 | |
| | | | | | | | |
| | |
| | | | IT Consulting & Other Services 1.5% | | | | |
| | 372,861 | | | InterXion Holding N.V.* (Netherlands) | | | 24,881,014 | |
| | | | | | | | |
| | |
| | | | Life Sciences Tools & Services 4.2% | | | | |
| | 345,388 | | | ICON plc* (Ireland) | | | 47,173,093 | |
| | 407,022 | | | Medpace Holdings, Inc.* | | | 24,002,087 | |
| | | | | | | | |
| | | | 71,175,180 | |
| | | | | | | | |
| | |
| | | | Managed Health Care 2.2% | | | | |
| | 500,601 | | | HealthEquity, Inc.* | | | 37,034,462 | |
| | | | | | | | |
| | |
| | | | Pharmaceuticals 0.5% | | | | |
| | 733,342 | | | Intra-Cellular Therapies, Inc.* | | | 8,932,106 | |
| | | | | | | | |
| | |
| | | | Regional Banks 4.7% | | | | |
| | 646,584 | | | Eagle Bancorp, Inc.* | | | 32,458,517 | |
| | 1,160,259 | | | Metro Bank plc* (United Kingdom) | | | 11,454,736 | |
| | 409,784 | | | Pinnacle Financial Partners, Inc. | | | 22,415,185 | |
| | 233,050 | | | Texas Capital Bancshares, Inc.* | | | 12,722,199 | |
| | | | | | | | |
| | | | 79,050,637 | |
| | | | | | | | |
| | |
| | | | Restaurants 2.3% | | | | |
| | 639,545 | | | Chuy’s Holdings, Inc.* | | | 14,562,440 | |
| | 410,487 | | | Shake Shack, Inc., Class A* | | | 24,280,306 | |
| | | | | | | | |
| | | | 38,842,746 | |
| | | | | | | | |
| | |
| | | | Semiconductors 2.4% | | | | |
| | 300,471 | | | Monolithic Power Systems, Inc. | | | 40,710,816 | |
| | | | | | | | |
| | |
| | | | Specialty Stores 4.5% | | | | |
| | 330,925 | | | Five Below, Inc.* | | | 41,117,431 | |
| | 1,120,666 | | | National Vision Holdings, Inc.* | | | 35,222,533 | |
| | | | | | | | |
| | | | 76,339,964 | |
| | | | | | | | |
| | |
| | | | Systems Software 6.8% | | | | |
| | 271,156 | | | CyberArk Software Ltd.* (Israel) | | | 32,281,122 | |
| | 296,211 | | | Proofpoint, Inc.* | | | 35,968,902 | |
| | 602,626 | | | Rapid7, Inc.* | | | 30,498,902 | |
| | 259,928 | | | Varonis Systems, Inc.* | | | 15,499,506 | |
| | | | | | | | |
| | | | 114,248,432 | |
| | | | | | | | |
| | |
| | | | Trading Companies & Distributors 1.2% | | | | |
| | 357,911 | | | SiteOne Landscape Supply, Inc.* | | | 20,454,614 | |
| | | | | | | | |
| | |
| | | | Trucking 2.2% | | | | |
| | 1,115,152 | | | Knight-Swift Transportation Holdings, Inc. | | | 36,443,167 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $1,081,891,191) | | | 1,644,582,509 | |
| | | | | | | | |
62
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | PREFERRED STOCKS 1.3% | | | | |
| | |
| | | | Biotechnology 0.0% | | | | |
| | 677,966 | | | Nanosys, Inc., Series D Pfd.* *** † | | $ | 454,237 | |
| | 161,519 | | | Nanosys, Inc., Series E Pfd.* *** † | | | 192,208 | |
| | | | | | | | |
| | | | 646,445 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 0.6% | | | | |
| | 666,667 | | | Medallia, Inc., Series F* *** † | | | 10,000,005 | |
| | | | | | | | |
| | |
| | | | Systems Software 0.7% | | | | |
| | 1,114,610 | | | DataStax, Inc., Series E Pfd.* *** † | | | 11,536,213 | |
| | | | | | | | |
| | |
| | | | Total Preferred Stocks
(cost $20,184,946) | | | 22,182,663 | |
| | | | | | | | |
| | |
| | | | LIMITED PARTNERSHIP INTEREST 0.2% | | | | |
| | |
| | | | Asset Management & Custody Banks 0.2% | | | | |
| | 1 | | | Greenspring Global PartnersII-B, L.P.* *** † | | | 1,635,311 | |
| | 1 | | | Greenspring Global PartnersIII-B, L.P.* *** † | | | 917,101 | |
| | | | | | | | |
| | | | 2,552,412 | |
| | | | | | | | |
| | |
| | | | Total Limited Partnership Interest
(cost $2,391,236) | | | 2,552,412 | |
| | | | | | | | |
| | |
| | | | SELLER’S NOTE 0.1% | | | | |
| | |
| | | | Oil & Gas Equipment & Services 0.1% | | | | |
| | 1,728,000 | | | Drilling Info Holdings, Inc., Series B, 7.25%*** † | | | 1,728,000 | |
| | | | | | | | |
| | |
| | | | Total Seller’s Note
(cost $937,635) | | | 1,728,000 | |
| | | | | | | | |
| | |
Principal
Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 0.4% | | | | |
| | |
| | | | Repurchase Agreement 0.4% | | | | |
| | $6,841,818 | | | Repurchase Agreement dated 3/29/19, 0.50% due 4/1/19 with Fixed Income Clearing Corp. collateralized by $6,935,000 of United States Treasury Notes 2.375% due 3/15/22; value: $6,980,251; repurchase proceeds: $6,842,103 (cost $6,841,818) | | $ | 6,841,818 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $6,841,818) | | | 6,841,818 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $1,112,246,826) 99.8% | | | 1,677,887,402 | |
| | |
| | | | Other Assets less Liabilities 0.2% | | | 2,944,825 | |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 1,680,832,227 | |
| | | | | | | | |
| |
| | | | *Non-income producing. ***Security was fair valued under procedures adopted by the Board of Trustees (see Note 12). †Security purchased in a private placement transaction or under Rule 144A of the Securities Act of 1933 (see Note 9). See Notes to Financial Statements. | |
At March 31, 2019, Wasatch Small Cap Growth Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
Argentina | | | | 1.9 | |
Ireland | | | | 2.8 | |
Israel | | | | 1.9 | |
Netherlands | | | | 1.5 | |
United Arab Emirates | | | | 1.8 | |
United Kingdom | | | | 2.4 | |
United States | | | | 87.7 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
63
| | |
| WASATCH SMALL CAP VALUE FUND(WMCVX / WICVX) | | |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 98.7% | | | | |
| | |
| | | | Aerospace & Defense 2.0% | | | | |
| | 120,497 | | | HEICO Corp., Class A | | $ | 10,128,978 | |
| | | | | | | | |
| | |
| | | | Airlines 3.4% | | | | |
| | 59,012 | | | Allegiant Travel Co. | | | 7,640,284 | |
| | 117,159 | | | Copa Holdings S.A., Class A (Panama) | | | 9,444,187 | |
| | | | | | | | |
| | | | 17,084,471 | |
| | | | | | | | |
| | |
| | | | Application Software 1.5% | | | | |
| | 147,372 | | | Ebix, Inc. | | | 7,275,756 | |
| | | | | | | | |
| | |
| | | | Asset Management & Custody Banks 4.3% | | | | |
| | 383,194 | | | Artisan Partners Asset Management, Inc., Class A | | | 9,644,993 | |
| | 277,490 | | | Hamilton Lane, Inc., Class A | | | 12,093,014 | |
| | | | | | | | |
| | | | 21,738,007 | |
| | | | | | | | |
| | |
| | | | Auto Parts & Equipment 3.7% | | | | |
| | 211,138 | | | Dorman Products, Inc.* | | | 18,599,146 | |
| | | | | | | | |
| | |
| | | | Automotive Retail 7.8% | | | | |
| | 438,695 | | | Camping World Holdings, Inc., Class A | | | 6,102,247 | |
| | 142,868 | | | Lithia Motors, Inc., Class A | | | 13,251,007 | |
| | 225,974 | | | Monro, Inc. | | | 19,551,271 | |
| | | | | | | | |
| | | | 38,904,525 | |
| | | | | | | | |
| | |
| | | | Commercial Printing 1.0% | | | | |
| | 63,526 | | | Cimpress N.V.* | | | 5,090,338 | |
| | | | | | | | |
| | |
| | | | Commodity Chemicals 1.8% | | | | |
| | 479,196 | | | Valvoline, Inc. | | | 8,893,878 | |
| | | | | | | | |
| | |
| | | | Consumer Electronics 1.3% | | | | |
| | 700,405 | | | ZAGG, Inc.* | | | 6,352,673 | |
| | | | | | | | |
| | |
| | | | Consumer Finance 1.8% | | | | |
| | 19,739 | | | Credit Acceptance Corp.* | | | 8,920,646 | |
| | | | | | | | |
| | |
| | | | Data Processing & Outsourced Services 4.7% | | | | |
| | 163,639 | | | Euronet Worldwide, Inc.* | | | 23,333,285 | |
| | | | | | | | |
| | |
| | | | Diversified Banks 1.2% | | | | |
| | 2,032,526 | | | City Union Bank Ltd. (India) | | | 6,000,023 | |
| | | | | | | | |
| | |
| | | | Diversified Support Services 1.1% | | | | |
| | 91,089 | | | Copart, Inc.* | | | 5,519,082 | |
| | | | | | | | |
| | |
| | | | Electronic Manufacturing Services 2.6% | | | | |
| | 247,761 | | | Fabrinet* | | | 12,972,766 | |
| | | | | | | | |
| | |
| | | | Health Care Facilities 3.3% | | | | |
| | 325,815 | | | Ensign Group, Inc. (The) | | | 16,678,470 | |
| | | | | | | | |
| | |
| | | | Health Care Services 2.0% | | | | |
| | 92,502 | | | LHC Group, Inc.* | | | 10,254,772 | |
| | | | | | | | |
| | |
| | | | Home Furnishing Retail 2.0% | | | | |
| | 213,796 | | | Sleep Number Corp.* | | | 10,048,412 | |
| | | | | | | | |
| | |
| | | | Home Furnishings 1.0% | | | | |
| | 172,087 | | | Lovesac Co. (The)* | | | 4,785,739 | |
| | | | | | | | |
| | |
| | | | Homebuilding 1.6% | | | | |
| | 132,395 | | | LGI Homes, Inc.* | | | 7,975,475 | |
| | | | | | | | |
| | |
| | | | Hotel & Resort REITs 2.6% | | | | |
| | 1,131,647 | | | Summit Hotel Properties, Inc. | | | 12,912,092 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Industrial Machinery 8.1% | | | | |
| | 418,104 | | | Altra Industrial Motion Corp. | | $ | 12,982,129 | |
| | 211,928 | | | Kadant, Inc. | | | 18,641,187 | |
| | 196,682 | | | Sun Hydraulics Corp. | | | 9,147,680 | |
| | | | | | | | |
| | | | 40,770,996 | |
| | | | | | | | |
| | |
| | | | Industrial REITs 2.0% | | | | |
| | 759,398 | | | Monmouth Real Estate Investment Corp. | | | 10,008,866 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 0.7% | | | | |
| | 44,697 | | | Stamps.com, Inc.* | | | 3,638,783 | |
| | | | | | | | |
| | |
| | | | IT Consulting & Other Services 1.8% | | | | |
| | 581,706 | | | Hackett Group, Inc. (The) | | | 9,190,955 | |
| | | | | | | | |
| | |
| | | | Life Sciences Tools & Services 1.7% | | | | |
| | 62,939 | | | ICON plc* (Ireland) | | | 8,596,209 | |
| | | | | | | | |
| | |
| | | | Mortgage REITs 4.9% | | | | |
| | 1,052,840 | | | Arbor Realty Trust, Inc. | | | 13,655,335 | |
| | 1,480,484 | | | MFA Financial, Inc. | | | 10,763,118 | |
| | | | | | | | |
| | | | 24,418,453 | |
| | | | | | | | |
| | |
| | | | Oil & Gas Equipment & Services 0.7% | | | | |
| | 212,508 | | | Oil States International, Inc.* | | | 3,604,136 | |
| | | | | | | | |
| | |
| | | | Oil & Gas Exploration & Production 1.2% | | | | |
| | 2,704,257 | | | Gran Tierra Energy, Inc.* (Colombia) | | | 6,138,663 | |
| | | | | | | | |
| | |
| | | | Personal Products 1.4% | | | | |
| | 151,058 | | | Nu Skin Enterprises, Inc., Class A | | | 7,229,636 | |
| | | | | | | | |
| | |
| | | | Regional Banks 12.3% | | | | |
| | 324,187 | | | FB Financial Corp. | | | 10,296,179 | |
| | 127,031 | | | People’s Utah Bancorp | | | 3,349,808 | |
| | 203,846 | | | Pinnacle Financial Partners, Inc. | | | 11,150,376 | |
| | 130,255 | | | Prosperity Bancshares, Inc. | | | 8,995,410 | |
| | 141,901 | | | South State Corp. | | | 9,697,514 | |
| | 100,536 | | | Texas Capital Bancshares, Inc.* | | | 5,488,260 | |
| | 251,716 | | | Webster Financial Corp. | | | 12,754,450 | |
| | | | | | | | |
| | | | 61,731,997 | |
| | | | | | | | |
| | |
| | | | Semiconductors 1.6% | | | | |
| | 491,453 | | | Tower Semiconductor Ltd.* (Israel) | | | 8,138,462 | |
| | | | | | | | |
| | |
| | | | Specialized REITs 1.8% | | | | |
| | 313,289 | | | National Storage Affiliates Trust | | | 8,931,869 | |
| | | | | | | | |
| | |
| | | | Specialty Chemicals 3.1% | | | | |
| | 185,975 | | | Innospec, Inc. | | | 15,501,016 | |
| | | | | | | | |
| | |
| | | | Thrifts & Mortgage Finance 1.9% | | | | |
| | 334,184 | | | Axos Financial, Inc.* | | | 9,677,969 | |
| | | | | | | | |
| | |
| | | | Trucking 4.8% | | | | |
| | 571,714 | | | Knight-Swift Transportation Holdings, Inc. | | | 18,683,613 | |
| | 38,894 | | | Old Dominion Freight Line, Inc. | | | 5,615,905 | |
| | | | | | | | |
| | | | 24,299,518 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $410,673,053) | | | 495,346,062 | |
| | | | | | | | |
64
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | |
Principal Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 2.0% | | | | |
| | |
| | | | Repurchase Agreement 2.0% | | | | |
| | $10,112,910 | | | Repurchase Agreement dated 3/29/19, 0.50% due 4/1/19 with Fixed Income Clearing Corp. collateralized by $10,250,000 of United States Treasury Notes 2.375% due 3/15/22; value: $10,316,881; repurchase proceeds: $10,113,331 (cost $10,112,910) | | $ | 10,112,910 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $10,112,910) | | | 10,112,910 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $420,785,963) 100.7% | | | 505,458,972 | |
| | |
| | | | Liabilities less Other Assets (0.7%) | | | (3,427,346 | ) |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 502,031,626 | |
| | | | | | | | |
| |
| | | | *Non-income producing. REIT Real Estate Investment Trust. See Notes to Financial Statements. | |
At March 31, 2019, Wasatch Small Cap Value Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
Colombia | | | | 1.2 | |
India | | | | 1.2 | |
Ireland | | | | 1.7 | |
Israel | | | | 1.7 | |
Panama | | | | 1.9 | |
United States | | | | 92.3 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
65
| | |
| WASATCH ULTRA GROWTH FUND(WAMCX) | | |
|
|
|
Schedule of Investments
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | | | COMMON STOCKS 90.5% | | | | |
| | |
| | | | Alternative Carriers 1.2% | | | | |
| | 92,251 | | | Bandwidth, Inc., Class A* | | $ | 6,177,127 | |
| | | | | | | | |
| | |
| | | | Application Software 13.0% | | | | |
| | 301,751 | | | Box, Inc., Class A* | | | 5,826,812 | |
| | 89,085 | | | DocuSign, Inc.* | | | 4,618,166 | |
| | 108,856 | | | Five9, Inc.* | | | 5,750,863 | |
| | 88,431 | | | Globant S.A.* (Argentina) | | | 6,313,973 | |
| | 55,102 | | | HubSpot, Inc.* | | | 9,158,504 | |
| | 173,774 | | | Instructure, Inc.* | | | 8,188,231 | |
| | 154,807 | | | Paylocity Holding Corp.* | | | 13,807,236 | |
| | 127,664 | | | Zendesk, Inc.* | | | 10,851,440 | |
| | | | | | | | |
| | | | 64,515,225 | |
| | | | | | | | |
| | |
| | | | Automotive Retail 1.6% | | | | |
| | 92,862 | | | Monro, Inc. | | | 8,034,420 | |
| | | | | | | | |
| | |
| | | | Biotechnology 11.1% | | | | |
| | 44,765 | | | Atara Biotherapeutics, Inc.* | | | 1,779,409 | |
| | 110,271 | | | Bellicum Pharmaceuticals, Inc.* | | | 371,613 | |
| | 423,176 | | | ChemoCentryx, Inc.* | | | 5,877,915 | |
| | 511,952 | | | Cytokinetics, Inc.* | | | 4,141,692 | |
| | 45,161 | | | Denali Therapeutics, Inc.* | | | 1,048,638 | |
| | 152,106 | | | Esperion Therapeutics, Inc.* | | | 6,107,056 | |
| | 68,962 | | | Exact Sciences Corp.* | | | 5,973,488 | |
| | 150,148 | | | Flexion Therapeutics, Inc.* | | | 1,873,847 | |
| | 1,159,411 | | | Inovio Pharmaceuticals, Inc.* | | | 4,324,603 | |
| | 227,473 | | | MacroGenics, Inc.* | | | 4,089,964 | |
| | 1,104,100 | | | MEI Pharma, Inc.* | | | 3,389,587 | |
| | 931,390 | | | Sangamo Therapeutics, Inc.* | | | 8,885,461 | |
| | 45,320 | | | Seattle Genetics, Inc.* | | | 3,319,237 | |
| | 1,187,354 | | | Selecta Biosciences, Inc.* | | | 2,814,029 | |
| | 252,861 | | | Unum Therapeutics, Inc.* | | | 1,110,060 | |
| | | | | | | | |
| | | | 55,106,599 | |
| | | | | | | | |
| | |
| | | | Building Products 3.7% | | | | |
| | 132,459 | | | AAON, Inc. | | | 6,116,957 | |
| | 195,651 | | | Trex Co., Inc.* | | | 12,036,449 | |
| | | | | | | | |
| | | | 18,153,406 | |
| | | | | | | | |
| | |
| | | | Construction & Engineering 1.3% | | | | |
| | 110,599 | | | NV5 Global, Inc.* | | | 6,565,157 | |
| | | | | | | | |
| | |
| | | | Department Stores 0.8% | | | | |
| | 101,855 | | | V-Mart Retail Ltd. (India) | | | 3,937,536 | |
| | | | | | | | |
| | |
| | | | Diversified Banks 1.5% | | | | |
| | 2,489,169 | | | City Union Bank Ltd. (India) | | | 7,348,034 | |
| | | | | | | | |
| | |
| | | | Diversified Support Services 0.6% | | | | |
| | 94,457 | | | Healthcare Services Group, Inc. | | | 3,116,136 | |
| | | | | | | | |
| | |
| | | | Electronic Equipment & Instruments 0.8% | | | | |
| | 174,076 | | | nLight, Inc.* | | | 3,878,413 | |
| | | | | | | | |
| | |
| | | | Electronic Manufacturing Services 0.7% | | | | |
| | 21,825 | | | IPG Photonics Corp.* | | | 3,312,599 | |
| | | | | | | | |
| | |
| | | | General Merchandise Stores 1.6% | | | | |
| | 91,751 | | | Ollie’s Bargain Outlet Holdings, Inc.* | | | 7,829,113 | |
| | | | | | | | |
| | |
| | | | Health Care Equipment 8.0% | | | | |
| | 291,948 | | | AtriCure, Inc.* | | | 7,821,287 | |
| | 307,267 | | | CryoLife, Inc.* | | | 8,962,978 | |
| | 72,875 | | | Glaukos Corp.* | | | 5,711,214 | |
| | 82,334 | | | Insulet Corp.* | | | 7,829,140 | |
| | 148,951 | | | Tandem Diabetes Care, Inc.* | | | 9,458,389 | |
| | | | | | | | |
| | | | 39,783,008 | |
| | | | | | | | |
| | | | | | | | |
| Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Health Care Technology 2.6% | | | | |
| | 128,888 | | | Inspire Medical Systems, Inc.* | | $ | 7,318,261 | |
| | 42,190 | | | Veeva Systems, Inc., Class A* | | | 5,352,223 | |
| | | | | | | | |
| | | | 12,670,484 | |
| | | | | | | | |
| | |
| | | | Heavy Electrical Equipment 1.5% | | | | |
| | 262,887 | | | TPI Composites, Inc.* | | | 7,523,826 | |
| | | | | | | | |
| | |
| | | | Home Improvement Retail 1.7% | | | | |
| | 207,186 | | | Floor & Decor Holdings, Inc., Class A* | | | 8,540,207 | |
| | | | | | | | |
| | |
| | | | Homebuilding 1.6% | | | | |
| | 134,675 | | | LGI Homes, Inc.* | | | 8,112,822 | |
| | | | | | | | |
| | |
| | | | Industrial Machinery 5.1% | | | | |
| | 115,393 | | | Barnes Group, Inc. | | | 5,932,354 | |
| | 405,851 | | | Kornit Digital Ltd.* (Israel) | | | 9,659,254 | |
| | 91,596 | | | Proto Labs, Inc.* | | | 9,630,403 | |
| | | | | | | | |
| | | | 25,222,011 | |
| | | | | | | | |
| | |
| | | | Industrial REITs 1.3% | | | | |
| | 490,843 | | | Monmouth Real Estate Investment Corp. | | | 6,469,311 | |
| | | | | | | | |
| | |
| | | | Insurance Brokers 1.0% | | | | |
| | 183,741 | | | Goosehead Insurance, Inc., Class A | | | 5,122,699 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 1.6% | | | | |
| | 53,610 | | | Wayfair, Inc., Class A* | | | 7,958,405 | |
| | | | | | | | |
| | |
| | | | Internet Services & Infrastructure 0.8% | | | | |
| | 31,989 | | | Twilio, Inc., Class A* | | | 4,132,339 | |
| | | | | | | | |
| | |
| | | | IT Consulting & Other Services 2.0% | | | | |
| | 149,278 | | | InterXion Holding N.V.* (Netherlands) | | | 9,961,321 | |
| | | | | | | | |
| | |
| | | | Managed Health Care 1.2% | | | | |
| | 79,666 | | | HealthEquity, Inc.* | | | 5,893,691 | |
| | | | | | | | |
| | |
| | | | Oil & Gas Equipment & Services 1.4% | | | | |
| | 68,010 | | | Oil States International, Inc.* | | | 1,153,450 | |
| | 350,724 | | | Solaris Oilfield Infrastructure, Inc., Class A | | | 5,765,902 | |
| | | | | | | | |
| | | | 6,919,352 | |
| | | | | | | | |
| | |
| | | | Packaged Foods & Meats 2.2% | | | | |
| | 252,284 | | | Freshpet, Inc.* | | | 10,669,090 | |
| | | | | | | | |
| | |
| | | | Pharmaceuticals 1.6% | | | | |
| | 323,443 | | | Cocrystal Pharma, Inc.* | | | 882,999 | |
| | 523,000 | | | Cocrystal Pharma, Inc.* *** † | | | 1,286,580 | |
| | 470,728 | | | Intra-Cellular Therapies, Inc.* | | | 5,733,467 | |
| | | | | | | | |
| | | | 7,903,046 | |
| | | | | | | | |
| | |
| | | | Regional Banks 5.3% | | | | |
| | 181,646 | | | Bank OZK | | | 5,264,101 | |
| | 110,478 | | | Eagle Bancorp, Inc.* | | | 5,545,996 | |
| | 212,041 | | | Esquire Financial Holdings, Inc.* | | | 4,826,053 | |
| | 305,082 | | | Metro Bank plc* (United Kingdom) | | | 3,011,943 | |
| | 84,083 | | | Pinnacle Financial Partners, Inc. | | | 4,599,340 | |
| | 571,531 | | | Republic First Bancorp, Inc.* | | | 3,000,538 | |
| | | | | | | | |
| | | | 26,247,971 | |
| | | | | | | | |
| | |
| | | | Restaurants 2.0% | | | | |
| | 281,836 | | | Chuy’s Holdings, Inc.* | | | 6,417,406 | |
| | 325,770 | | | Habit Restaurants, Inc. (The), Class A* | | | 3,524,831 | |
| | | | | | | | |
| | | | 9,942,237 | |
| | | | | | | | |
| | |
| | | | Semiconductors 3.5% | | | | |
| | 89,344 | | | Ambarella, Inc.* | | | 3,859,661 | |
| | 136,627 | | | Inphi Corp.* | | | 5,976,065 | |
| | 47,969 | | | Monolithic Power Systems, Inc. | | | 6,499,320 | |
| | 12,733 | | | NVE Corp. | | | 1,246,433 | |
| | | | | | | | |
| | | | 17,581,479 | |
| | | | | | | | |
66
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | |
Shares | | | | | Value | |
| | | | | | | |
| | |
| | | | Specialty Chemicals 1.4% | | | | |
| | 72,878 | | | Balchem Corp. | | $ | 6,763,078 | |
| | | | | | | | |
| | |
| | | | Specialty Stores 1.9% | | | | |
| | 76,906 | | | Five Below, Inc.* | | | 9,555,570 | |
| | | | | | | | |
| | |
| | | | Systems Software 2.8% | | | | |
| | 72,618 | | | Proofpoint, Inc.* | | | 8,818,004 | |
| | 260,041 | | | Zuora, Inc., Class A* | | | 5,208,621 | |
| | | | | | | | |
| | | | 14,026,625 | |
| | | | | | | | |
| | |
| | | | Trucking 2.1% | | | | |
| | 322,736 | | | Knight-Swift Transportation Holdings, Inc. | | | 10,547,012 | |
| | | | | | | | |
| | |
| | | | Total Common Stocks
(cost $386,732,020) | | | 449,519,349 | |
| | | | | | | | |
| | |
| | | | LIMITED PARTNERSHIP INTEREST 0.5% | | | | |
| | |
| | | | Asset Management & Custody Banks 0.5% | | | | |
| | 1 | | | Greenspring Global PartnersII-B, L.P.* *** † | | | 1,471,772 | |
| | 1 | | | Greenspring Global PartnersIII-B, L.P.* *** † | | | 917,101 | |
| | | | | | | | |
| | | | 2,388,873 | |
| | | | | | | | |
| | |
| | | | Total Limited Partnership Interest
(cost $2,213,566) | | | 2,388,873 | |
| | | | | | | | |
| | |
| | | | PREFERRED STOCKS 0.5% | | | | |
| | |
| | | | Biotechnology 0.0% | | | | |
| | 169,492 | | | Nanosys, Inc., Series D Pfd.* *** † | | | 113,560 | |
| | 40,380 | | | Nanosys, Inc., Series E Pfd.* *** † | | | 48,052 | |
| | | | | | | | |
| | | | 161,612 | |
| | | | | | | | |
| | |
| | | | Internet & Direct Marketing Retail 0.5% | | | | |
| | 150,000 | | | Medallia, Inc., Series F* *** † | | | 2,250,000 | |
| | | | | | | | |
| | |
| | | | Total Preferred Stocks
(cost $2,796,236) | | | 2,411,612 | |
| | | | | | | | |
| | |
| | | | SELLER’S NOTE 0.0% | | | | |
| | |
| | | | Oil & Gas Equipment & Services 0.0% | | | | |
| | 132,000 | | | Drilling Info Holdings, Inc., Series B, 7.25%*** † | | | 132,000 | |
| | | | | | | | |
| | |
| | | | Total Seller’s Note
(cost $70,858) | | | 132,000 | |
| | | | | | | | |
| | | | | | | | |
Principal
Amount | | | | | Value | |
| | | | | | | |
| | |
| | | | SHORT-TERM INVESTMENTS 9.7% | | | | |
| | |
| | | | Repurchase Agreement 9.7% | | | | |
| | $48,318,364 | | | Repurchase Agreement dated 3/29/19, 0.50% due 4/1/19 with Fixed Income Clearing Corp. collateralized by $48,970,000 of United States Treasury Notes 2.375% due 3/15/22; value: $49,289,529; repurchase proceeds: $48,320,377 (cost $48,318,364) | | $ | 48,318,364 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $48,318,364) | | | 48,318,364 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $440,131,044) 101.2% | | | 502,770,198 | |
| | |
| | | | Liabilities less Other Assets (1.2%) | | | (5,802,044 | ) |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 496,968,154 | |
| | | | | | | | |
| |
| | | | *Non-income producing. ***Security was fair valued under procedures adopted by the Board of Trustees (see Note 12). †Security purchased in a private placement transaction or under Rule 144A of the Securities Act of 1933 (see Note 9). See Notes to Financial Statements. | |
At March 31, 2019, Wasatch Ultra Growth Fund’s investments, excluding short-term investments, were in the following countries:
| | | | | |
| Country | | % |
Argentina | | | | 1.4 | |
India | | | | 2.5 | |
Israel | | | | 2.1 | |
Netherlands | | | | 2.2 | |
United Kingdom | | | | 0.7 | |
United States | | | | 91.1 | |
| | | | | |
TOTAL | | | | 100.0 | % |
| | | | | |
67
| | |
| WASATCH-HOISINGTON U.S. TREASURY FUND(WHOSX) | | MARCH 31, 2019 (UNAUDITED) |
|
|
|
Schedule of Investments
| | | | | | | | |
Principal Amount | | | | | Value | |
| | | | | | | |
| | | | U.S. GOVERNMENT OBLIGATIONS 99.7% | |
| | |
| $ | 48,030,000 | | | U.S. Treasury Bond, 3.00%, 8/15/48 | | $ | 49,718,555 | |
| | 112,300,000 | | | U.S. Treasury Bond, 2.25%, 8/15/46 | | | 100,140,016 | |
| | 18,000,000 | | | U.S. Treasury Bond, 2.50%, 2/15/45 | | | 16,983,281 | |
| | 2,700,000 | | | U.S. Treasury Bond, 3.125%, 8/15/44 | | | 2,861,894 | |
| | 11,000,000 | | | U.S. Treasury Bond, 3.75%, 11/15/43 | | | 12,895,352 | |
| | 39,000,000 | | | U.S. Treasury Strip, principal only, 8/15/40 | | | 21,784,634 | |
| | 81,000,000 | | | U.S. Treasury Strip, principal only, 5/15/44 | | | 39,688,823 | |
| | 175,700,000 | | | U.S. Treasury Strip, principal only, 8/15/45 | | | 82,992,937 | |
| | | | | | | | |
| | |
| | | | Total U.S. Government Obligations
(cost $335,447,710) | | | 327,065,492 | |
| | | | | | | | |
| | | | | | | | |
Principal Amount | | | | | Value | |
| | | | | | | |
| | | | SHORT-TERM INVESTMENTS 0.3% | | | | |
| | |
| | | | Repurchase Agreement 0.3% | | | | |
| | $ 940,990 | | | Repurchase Agreement dated 3/29/19,
0.50% due 4/1/19 with Fixed Income
Clearing Corp. collateralized by $955,000
of United States Treasury Notes 2.375%
due 3/15/22; value: $961,231; repurchase
proceeds: $941,029 (cost $940,990) | | $ | 940,990 | |
| | | | | | | | |
| | |
| | | | Total Short-Term Investments
(cost $940,990) | | | 940,990 | |
| | | | | | | | |
| | |
| | | | Total Investments
(cost $336,388,700) 100.0% | | | 328,006,482 | |
| | |
| | | | Other Assets less Liabilities <0.1% | | | 33,808 | |
| | | | | | | | |
| | |
| | | | NET ASSETS 100.0% | | $ | 328,040,290 | |
| | | | | | | | |
| |
| | | | See Notes to Financial Statements. | |
68
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69
Statements of Assets and Liabilities
| | | | | | | | | | | | | | | |
| | | CORE
GROWTH
FUND | | EMERGING
INDIA
FUND | | EMERGING
MARKETS
SELECT
FUND |
| | | | | | | | | | | | | | | |
Assets: | | | | | | | | | | | | | | | |
Investments, at cost | | | | | | | | | | | | | | | |
Unaffiliated issuers | | | $ | 1,499,110,342 | | | | $ | 205,196,252 | | | | $ | 35,626,828 | |
Repurchase agreements | | | | 27,396,297 | | | | | 2,624,967 | | | | | 811,475 | |
| | | | | | | | | | | | | | | |
| | | $ | 1,526,506,639 | | | | $ | 207,821,219 | | | | $ | 36,438,303 | |
| | | | | | | | | | | | | | | |
Investments, at market value | | | | | | | | | | | | | | | |
Unaffiliated issuers | | | $ | 2,136,939,401 | | | | $ | 268,444,965 | | | | $ | 45,305,207 | |
Repurchase agreements | | | | 27,396,297 | | | | | 2,624,967 | | | | | 811,475 | |
| | | | | | | | | | | | | | | |
| | | | 2,164,335,698 | | | | | 271,069,932 | | | | | 46,116,682 | |
Cash | | | | 100,435 | | | | | — | | | | | — | |
Foreign currency on deposit (cost of $0, $0, $0, $54, $3,363,649, $7,314, $0 and $303,066, respectively) | | | | — | | | | | — | | | | | — | |
Receivable for investment securities sold | | | | 1,053,305 | | | | | — | | | | | — | |
Capital shares receivable | | | | 4,523,111 | | | | | 423,439 | | | | | 982 | |
Interest and dividends receivable | | | | 845,958 | | | | | 30,208 | | | | | 66,132 | |
Prepaid expenses and other assets | | | | 109,753 | | | | | 38,087 | | | | | 21,367 | |
| | | | | | | | | | | | | | | |
Total Assets | | | | 2,170,968,260 | | | | | 271,561,666 | | | | | 46,205,163 | |
| | | | | | | | | | | | | | | |
Liabilities: | | | | | | | | | | | | | | | |
Bank overdraft | | | | — | | | | | — | | | | | — | |
Payable for securities purchased | | | | — | | | | | — | | | | | — | |
Capital shares payable | | | | 2,071,887 | | | | | 86,633 | | | | | — | |
Dividends payable to shareholders | | | | — | | | | | — | | | | | — | |
Payable to Advisor | | | | 1,815,297 | | | | | 276,141 | | | | | 26,446 | |
Accrued fund administration fees | | | | 119,156 | | | | | 13,348 | | | | | 1,625 | |
Accrued expenses and other liabilities | | | | 725,449 | | | | | 334,565 | | | | | 99,688 | |
Foreign capital gains taxes payable | | | | 786,255 | | | | | 3,992,343 | | | | | 306,497 | |
Line of credit payable | | | | — | | | | | — | | | | | — | |
| | | | | | | | | | | | | | | |
Total Liabilities | | | | 5,518,044 | | | | | 4,703,030 | | | | | 434,256 | |
| | | | | | | | | | | | | | | |
Net Assets | | | $ | 2,165,450,216 | | | | $ | 266,858,636 | | | | $ | 45,770,907 | |
| | | | | | | | | | | | | | | |
Net Assets Consist of: | | | | | | | | | | | | | | | |
Capital stock | | | $ | 313,323 | | | | $ | 640,511 | | | | $ | 40,858 | |
Paid-in-capital in excess of par | | | | 1,478,406,037 | | | | | 214,973,685 | | | | | 42,070,658 | |
Distributable earnings (accumulated loss) | | | | 686,730,856 | | | | | 51,244,440 | | | | | 3,659,391 | |
| | | | | | | | | | | | | | | |
Net Assets | | | $ | 2,165,450,216 | | | | $ | 266,858,636 | | | | $ | 45,770,907 | |
| | | | | | | | | | | | | | | |
Net Assets | | | | | | | | | | | | | | | |
Investor Class | | | | 1,402,277,375 | | | | | 194,421,955 | | | | | 10,606,145 | |
Institutional Class | | | | 763,172,841 | | | | | 72,436,681 | | | | | 35,164,762 | |
| | | |
Capital Stock Issued and Outstanding (Unlimited number of
shares authorized, $0.01 par value) | | | | | | | | | | | | | | | |
Investor Class | | | | 20,351,204 | | | | | 46,757,695 | | | | | 959,049 | |
Institutional Class | | | | 10,981,095 | | | | | 17,293,422 | | | | | 3,126,771 | |
| | | |
NET ASSET VALUE, REDEMPTION PRICEAND OFFERING PRICE PER SHARE | | | | | | | | | | | | | | | |
Investor Class | | | $ | 68.90 | | | | $ | 4.16 | | | | $ | 11.06 | |
| | | | | | | | | | | | | | | |
Institutional Class | | | $ | 69.50 | | | | $ | 4.19 | | | | $ | 11.25 | |
| | | | | | | | | | | | | | | |
| 1 | Foreign currency on deposit includes a position in Zimbabwe’s currency, the RTGS dollar, which was fair valued during the period (see Note 12). |
See Notes to Financial Statements.
70
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | | |
EMERGING
MARKETS
SMALL CAP
FUND | | FRONTIER
EMERGING
SMALL COUNTRIES
FUND | | GLOBAL
OPPORTUNITIES
FUND | | GLOBAL
VALUE
FUND | | INTERNATIONAL
GROWTH
FUND |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 315,679,332 | | | | $ | 59,387,557 | | | | $ | 80,156,360 | | | | $ | 153,600,085 | | | | $ | 943,804,331 | |
| | | — | | | | | 917,970 | | | | | 2,196,646 | | | | | 3,535,378 | | | | | 40,838,984 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 315,679,332 | | | | $ | 60,305,527 | | | | $ | 82,353,006 | | | | $ | 157,135,463 | | | | $ | 984,643,315 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 437,916,732 | | | | $ | 62,513,566 | | | | $ | 114,077,206 | | | | $ | 167,126,984 | | | | $ | 1,233,514,907 | |
| | | — | | | | | 917,970 | | | | | 2,196,646 | | | | | 3,535,378 | | | | | 40,838,984 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 437,916,732 | | | | | 63,431,536 | | | | | 116,273,852 | | | | | 170,662,362 | | | | | 1,274,353,891 | |
| | | — | | | | | 652,000 | | | | | — | | | | | — | | | | | 10,369,878 | |
| | | 54 | | | | | 881,919 | 1 | | | | 7,357 | | | | | — | | | | | 304,391 | |
| | | — | | | | | — | | | | | 4,150,829 | | | | | 625,812 | | | | | 4,344,318 | |
| | | 7,907,218 | | | | | 2,085 | | | | | 10,191 | | | | | 5,888 | | | | | 4,328,909 | |
| | | 997,958 | | | | | 161,266 | | | | | 107,119 | | | | | 1,504,682 | | | | | 2,647,833 | |
| | | 32,543 | | | | | 24,939 | | | | | 24,098 | | | | | 20,436 | | | | | 54,617 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 446,854,505 | | | | | 65,153,745 | | | | | 120,573,446 | | | | | 172,819,180 | | | | | 1,296,403,837 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | — | | | | | — | | | | | — | | | | | 3,000 | | | | | — | |
| | | — | | | | | 556,202 | | | | | 3,449,187 | | | | | 603,082 | | | | | 15,706,831 | |
| | | 334,931 | | | | | 10,982 | | | | | 20,753 | | | | | 357,016 | | | | | 1,561,119 | |
| | | — | | | | | — | | | | | — | | | | | 27,356 | | | | | — | |
| | | 586,494 | | | | | 76,806 | | | | | 119,693 | | | | | 120,074 | | | | | 1,340,894 | |
| | | 27,148 | | | | | 5,427 | | | | | 5,709 | | | | | 15,426 | | | | | 72,926 | |
| | | 476,242 | | | | | 277,441 | | | | | 110,716 | | | | | 302,850 | | | | | 610,951 | |
| | | 1,880,195 | | | | | 577,902 | | | | | 156,328 | | | | | — | | | | | 9,249 | |
| | | 859,296 | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 4,164,306 | | | | | 1,504,760 | | | | | 3,862,386 | | | | | 1,428,804 | | | | | 19,301,970 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 442,690,199 | | | | $ | 63,648,985 | | | | $ | 116,711,060 | | | | $ | 171,390,376 | | | | $ | 1,277,101,867 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 1,728,405 | | | | $ | 243,308 | | | | $ | 349,411 | | | | $ | 221,532 | | | | $ | 456,318 | |
| | | 331,950,682 | | | | | 169,957,227 | | | | | 79,225,780 | | | | | 327,521,568 | | | | | 976,768,934 | |
| | | 109,011,112 | | | | | (106,551,550 | ) | | | | 37,135,869 | | | | | (156,352,724 | ) | | | | 299,876,615 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 442,690,199 | | | | $ | 63,648,985 | | | | $ | 116,711,060 | | | | $ | 171,390,376 | | | | $ | 1,277,101,867 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 229,287,254 | | | | | 46,780,468 | | | | | 99,315,316 | | | | | 162,959,663 | | | | | 614,384,141 | |
| | | 213,402,945 | | | | | 16,868,517 | | | | | 17,395,744 | | | | | 8,430,713 | | | | | 662,717,726 | |
| | | | |
| |
|
|
| | | | | | | | | | | | | | | | | | | | |
| | | 89,753,018 | | | | | 17,918,428 | | | | | 29,749,312 | | | | | 21,061,824 | | | | | 21,987,242 | |
| | | 83,087,513 | | | | | 6,412,377 | | | | | 5,191,744 | | | | | 1,091,369 | | | | | 23,644,553 | |
| | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 2.55 | | | | $ | 2.61 | | | | $ | 3.34 | | | | $ | 7.74 | | | | $ | 27.94 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 2.57 | | | | $ | 2.63 | | | | $ | 3.35 | | | | $ | 7.72 | | | | $ | 28.03 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
71
Statements of Assets and Liabilities(continued)
| | | | | | | | | | | | | | | |
| | | INTERNATIONAL
OPPORTUNITIES
FUND | | MICRO
CAP
FUND | | MICRO CAP
VALUE
FUND |
| | | | | | | | | | | | | | | |
Assets: | | | | | | | | | | | | | | | |
Investments, at cost | |
Unaffiliated issuers | | | $ | 281,897,406 | | | | $ | 347,653,062 | | | | $ | 185,205,671 | |
Repurchase agreements | | | | 18,950,264 | | | | | 4,054,338 | | | | | 10,052,067 | |
| | | | | | | | | | | | | | | |
| | | $ | 300,847,670 | | | | $ | 351,707,400 | | | | $ | 195,257,738 | |
| | | | | | | | | | | | | | | |
Investments, at market value | |
Unaffiliated issuers | | | $ | 394,752,151 | | | | $ | 444,827,721 | | | | $ | 240,819,025 | |
Repurchase agreements | | | | 18,950,264 | | | | | 4,054,338 | | | | | 10,052,067 | |
| | | | | | | | | | | | | | | |
| | | | 413,702,415 | | | | | 448,882,059 | | | | | 250,871,092 | |
Foreign currency on deposit (cost of $298,918, $14,903, $0, $0, $0, $0 and $0, respectively) | | | | 299,004 | | | | | 14,988 | | | | | — | |
Receivable for investment securities sold | | | | 982,788 | | | | | 213,358 | | | | | 965,569 | |
Capital shares receivable | | | | 230,436 | | | | | 187,513 | | | | | 48,553 | |
Interest and dividends receivable | | | | 732,095 | | | | | 387,231 | | | | | 179,339 | |
Prepaid expenses and other assets | | | | 32,786 | | | | | 28,081 | | | | | 41,217 | |
| | | | | | | | | | | | | | | |
Total Assets | | | | 415,979,524 | | | | | 449,713,230 | | | | | 252,105,770 | |
| | | | | | | | | | | | | | | |
Liabilities: | |
Payable for securities purchased | | | | 1,252,151 | | | | | 814,287 | | | | | 413,851 | |
Capital shares payable | | | | 112,512 | | | | | 328,827 | | | | | 223,803 | |
Dividends payable to shareholders | | | | — | | | | | — | | | | | — | |
Payable to Advisor | | | | 607,102 | | | | | 566,846 | | | | | 323,525 | |
Accrued fund administration fees | | | | 23,455 | | | | | 23,644 | | | | | 13,445 | |
Accrued expenses and other liabilities | | | | 419,445 | | | | | 167,183 | | | | | 170,158 | |
Foreign capital gains taxes payable | | | | — | | | | | 400,237 | | | | | 69,268 | |
| | | | | | | | | | | | | | | |
Total Liabilities | | | | 2,414,665 | | | | | 2,301,024 | | | | | 1,214,050 | |
| | | | | | | | | | | | | | | |
Net Assets | | | $ | 413,564,859 | | | | $ | 447,412,206 | | | | $ | 250,891,720 | |
| | | | | | | | | | | | | | | |
Net Assets Consist of: | |
Capital stock | | | $ | 1,250,448 | | | | $ | 628,402 | | | | $ | 801,433 | |
Paid-in-capital in excess of par | | | | 305,527,722 | | | | | 327,647,380 | | | | | 190,062,103 | |
Distributable earnings (accumulated loss) | | | | 106,786,689 | | | | | 119,136,424 | | | | | 60,028,184 | |
| | | | | | | | | | | | | | | |
Net Assets | | | $ | 413,564,859 | | | | $ | 447,412,206 | | | | $ | 250,891,720 | |
| | | | | | | | | | | | | | | |
Net Assets | |
Investor Class | | | | 133,333,427 | | | | | 447,412,206 | | | | | 250,891,720 | |
Institutional Class | | | | 280,231,432 | | | | | — | | | | | — | |
| | | |
Capital Stock Issued and Outstanding (Unlimited number of
shares authorized, $0.01 par value) | | | | | | | | | | | | | | | |
Investor Class | | | | 40,653,615 | | | | | 62,840,237 | | | | | 80,143,305 | |
Institutional Class | | | | 84,391,199 | | | | | — | | | | | — | |
| | | |
NET ASSET VALUE, REDEMPTION PRICEAND OFFERING PRICE PER SHARE | | | | | | | | | | | | | | | |
Investor Class | | | $ | 3.28 | | | | $ | 7.12 | | | | $ | 3.13 | |
| | | | | | | | | | | | | | | |
Institutional Class | | | $ | 3.32 | | | | $ | — | | | | $ | — | |
| | | | | | | | | | | | | | | |
See Notes to Financial Statements.
72
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | | | | | | | | | |
SMALL CAP
GROWTH
FUND | | SMALL CAP
VALUE
FUND | | ULTRA
GROWTH
FUND | | U.S.
TREASURY
FUND |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | $ | 1,105,405,008 | | | | $ | 410,673,053 | | | | $ | 391,812,680 | | | | $ | 335,447,710 | |
| | | 6,841,818 | | | | | 10,112,910 | | | | | 48,318,364 | | | | | 940,990 | |
| | | | | | | | | | | | | | | | | | | |
| | $ | 1,112,246,826 | | | | $ | 420,785,963 | | | | $ | 440,131,044 | | | | $ | 336,388,700 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | $ | 1,671,045,584 | | | | $ | 495,346,062 | | | | $ | 454,451,834 | | | | $ | 327,065,492 | |
| | | 6,841,818 | | | | | 10,112,910 | | | | | 48,318,364 | | | | | 940,990 | |
| | | | | | | | | | | | | | | | | | | |
| | | 1,677,887,402 | | | | | 505,458,972 | | | | | 502,770,198 | | | | | 328,006,482 | |
| | | — | | | | | — | | | | | — | | | | | — | |
| | | 4,759,668 | | | | | — | | | | | — | | | | | — | |
| | | 550,595 | | | | | 1,182,446 | | | | | 1,942,636 | | | | | 146,764 | |
| | | 581,048 | | | | | 492,877 | | | | | 102,861 | | | | | 715,795 | |
| | | 57,793 | | | | | 55,450 | | | | | 66,524 | | | | | 40,045 | |
| | | | | | | | | | | | | | | | | | | |
| | | 1,683,836,506 | | | | | 507,189,745 | | | | | 504,882,219 | | | | | 328,909,086 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | — | | | | | 4,324,034 | | | | | 6,679,586 | | | | | — | |
| | | 849,166 | | | | | 108,195 | | | | | 377,936 | | | | | 459,425 | |
| | | — | | | | | — | | | | | — | | | | | 114,505 | |
| | | 1,389,622 | | | | | 411,496 | | | | | 394,665 | | | | | 132,546 | |
| | | 96,061 | | | | | 25,525 | | | | | 19,713 | | | | | 17,073 | |
| | | 669,430 | | | | | 194,612 | | | | | 145,000 | | | | | 145,247 | |
| | | — | | | | | 94,257 | | | | | 297,165 | | | | | — | |
| | | | | | | | | | | | | | | | | | | |
| | | 3,004,279 | | | | | 5,158,119 | | | | | 7,914,065 | | | | | 868,796 | |
| | | | | | | | | | | | | | | | | | | |
| | $ | 1,680,832,227 | | | | $ | 502,031,626 | | | | $ | 496,968,154 | | | | $ | 328,040,290 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | $ | 432,916 | | | | $ | 680,083 | | | | $ | 198,944 | | | | $ | 198,018 | |
| | | 1,036,894,938 | | | | | 420,636,834 | | | | | 433,255,922 | | | | | 357,273,583 | |
| | | 643,504,373 | | | | | 80,714,709 | | | | | 63,513,288 | | | | | (29,431,311 | ) |
| | | | | | | | | | | | | | | | | | | |
| | $ | 1,680,832,227 | | | | $ | 502,031,626 | | | | $ | 496,968,154 | | | | $ | 328,040,290 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | 1,010,136,827 | | | | | 370,846,497 | | | | | 496,968,154 | | | | | 328,040,290 | |
| | | 670,695,400 | | | | | 131,185,129 | | | | | — | | | | | — | |
| | | |
| |
|
|
| | | | | | | | | | | | | | | |
| | | 26,106,853 | | | | | 50,326,100 | | | | | 19,894,434 | | | | | 19,801,840 | |
| | | 17,184,782 | | | | | 17,682,151 | | | | | — | | | | | — | |
| | | |
| |
|
|
| | | | | | | | | | | | | | | |
| | $ | 38.69 | | | | $ | 7.37 | | | | $ | 24.98 | | | | $ | 16.57 | |
| | | | | | | | | | | | | | | | | | | |
| | $ | 39.03 | | | | $ | 7.42 | | | | $ | — | | | | $ | — | |
| | | | | | | | | | | | | | | | | | | |
73
Statements of Operations
| | | | | | | | | | | | | | | |
| | | CORE
GROWTH
FUND | | EMERGING
INDIA
FUND | | EMERGING
MARKETS
SELECT
FUND |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Investment Income: | |
Interest | | | $ | 87,088 | | | | $ | 10,083 | | | | $ | 1,553 | |
Dividends1 | |
Unaffiliated issuers | | | | 6,723,893 | | | | | 424,526 | | | | | 144,626 | |
| | | | | | | | | | | | | | | |
Total investment income | | | | 6,810,981 | | | | | 434,609 | | | | | 146,179 | |
| | | | | | | | | | | | | | | |
Expenses: | |
Investment advisory fees | | | | 10,356,803 | | | | | 1,473,163 | | | | | 208,806 | |
Shareholder servicing fees — Investor Class | | | | 769,621 | | | | | 160,590 | | | | | 27,994 | |
Shareholder servicing fees — Institutional Class | | | | 10,729 | | | | | 1,406 | | | | | 1,990 | |
Fund administration fees | | | | 177,694 | | | | | 20,267 | | | | | 3,587 | |
Fund accounting fees | | | | 105,380 | | | | | 23,222 | | | | | 12,715 | |
Reports to shareholders — Investor Class | | | | 82,733 | | | | | 26,794 | | | | | 8,879 | |
Reports to shareholders — Institutional Class | | | | 41,141 | | | | | 2,748 | | | | | 2,182 | |
Custody fees | | | | 38,096 | | | | | 144,481 | | | | | 27,150 | |
Federal and state registration fees — Investor Class | | | | 31,881 | | | | | 16,680 | | | | | 7,121 | |
Federal and state registration fees — Institutional Class | | | | 39,925 | | | | | 9,382 | | | | | 8,394 | |
Legal fees | | | | 65,663 | | | | | 6,836 | | | | | 1,270 | |
Trustees’ fees | | | | 139,998 | | | | | 14,485 | | | | | 2,666 | |
Interest | | | | 40,094 | | | | | 8,311 | | | | | 1,331 | |
Audit fees | | | | 17,258 | | | | | 17,258 | | | | | 17,258 | |
Other expenses | | | | 52,001 | | | | | 55,552 | | | | | 15,229 | |
| | | | | | | | | | | | | | | |
Total expenses before reimbursement | | | | 11,969,017 | | | | | 1,981,175 | | | | | 346,572 | |
Reimbursement of expenses by Advisor | | | | (120,191 | ) | | | | (12,420 | ) | | | | (77,076 | ) |
| | | | | | | | | | | | | | | |
Net Expenses | | | | 11,848,826 | | | | | 1,968,755 | | | | | 269,496 | |
| | | | | | | | | | | | | | | |
Net Investment Income (Loss) | | | | (5,037,845 | ) | | | | (1,534,146 | ) | | | | (123,317 | ) |
| | | | | | | | | | | | | | | |
Realized Gain (Loss): | |
Investments sold | | | | 82,726,100 | | | | | (429,642 | ) | | | | (460,910 | ) |
Foreign currency transactions | | | | (960 | ) | | | | (38,000 | ) | | | | 152 | |
Foreign capital gains taxes | | | | (3,171 | ) | | | | (327,049 | ) | | | | (7,651 | ) |
| | | | | | | | | | | | | | | |
Net realized gain (loss) | | | | 82,721,969 | | | | | (794,691 | ) | | | | (468,409 | ) |
| | | | | | | | | | | | | | | |
Change in Unrealized Appreciation (Depreciation): | |
Investments | | | | (225,089,921 | ) | | | | 32,901,072 | | | | | 3,467,500 | |
Foreign currency translations | | | | (1,576 | ) | | | | 5,993 | | | | | 566 | |
Deferred foreign capital gains taxes | | | | (373,908 | ) | | | | (1,546,831 | ) | | | | (145,494 | ) |
| | | | | | | | | | | | | | | |
Net change in unrealized appreciation (depreciation) | | | | (225,465,405 | ) | | | | 31,360,234 | | | | | 3,322,572 | |
| | | | | | | | | | | | | | | |
Net gain (loss) on investments | | | | (142,743,436 | ) | | | | 30,565,543 | | | | | 2,854,163 | |
| | | | | | | | | | | | | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | | $ | (147,781,281 | ) | | | $ | 29,031,397 | | | | $ | 2,730,846 | |
| | | | | | | | | | | | | | | |
| 1 | Net of $0, $0, $17,133, $134,242, $33,562, $(956), $126,446 and $629,279 in foreign withholding taxes, respectively. |
See Notes to Financial Statements.
74
| | |
| | FOR THE SIX MONTHS ENDED MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | | |
EMERGING
MARKETS
SMALL CAP
FUND | | FRONTIER
EMERGING
SMALL COUNTRIES
FUND | | GLOBAL
OPPORTUNITIES
FUND | | GLOBAL
VALUE
FUND | | INTERNATIONAL
GROWTH
FUND |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 12,621 | | | | $ | 4,537 | | | | $ | 4,641 | | | | $ | 14,308 | | | | $ | 101,451 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 1,362,527 | | | | | 324,406 | | | | | 236,839 | | | | | 3,107,024 | | | | | 6,221,778 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 1,375,148 | | | | | 328,943 | | | | | 241,480 | | | | | 3,121,332 | | | | | 6,323,229 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 3,620,573 | | | | | 551,909 | | | | | 682,610 | | | | | 802,332 | | | | | 7,942,315 | |
| | | 196,490 | | | | | 72,524 | | | | | 55,081 | | | | | 151,778 | | | | | 325,985 | |
| | | 1,834 | | | | | 1,170 | | | | | 1,196 | | | | | 930 | | | | | 8,003 | |
| | | 37,665 | | | | | 5,742 | | | | | 9,368 | | | | | 15,306 | | | | | 108,954 | |
| | | 36,006 | | | | | 15,122 | | | | | 18,847 | | | | | 19,269 | | | | | 75,317 | |
| | | 28,958 | | | | | 17,756 | | | | | 12,339 | | | | | 23,456 | | | | | 44,015 | |
| | | 11,073 | | | | | 1,892 | | | | | 2,296 | | | | | 509 | | | | | 21,179 | |
| | | 214,519 | | | | | 126,668 | | | | | 15,021 | | | | | 15,232 | | | | | 193,511 | |
| | | 13,978 | | | | | 9,929 | | | | | 10,108 | | | | | 11,199 | | | | | 17,157 | |
| | | 13,251 | | | | | 7,302 | | | | | 6,660 | | | | | 6,524 | | | | | 16,184 | |
| | | 14,556 | | | | | 2,201 | | | | | 3,524 | | | | | 872 | | | | | 43,091 | |
| | | 31,172 | | | | | 4,754 | | | | | 7,465 | | | | | 11,509 | | | | | 92,288 | |
| | | 47,248 | | | | | 27,276 | | | | | 3,376 | | | | | 2,919 | | | | | 38,706 | |
| | | 17,258 | | | | | 17,258 | | | | | 17,258 | | | | | 17,081 | | | | | 17,258 | |
| | | 42,644 | | | | | 4,379 | | | | | 14,799 | | | | | 5,570 | | | | | 50,759 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 4,327,225 | | | | | 865,882 | | | | | 859,948 | | | | | 1,084,486 | | | | | 8,994,722 | |
| | | (153,075 | ) | | | | (136,764 | ) | | | | (17,568 | ) | | | | (107,412 | ) | | | | (18,843 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 4,174,150 | | | | | 729,118 | | | | | 842,380 | | | | | 977,074 | | | | | 8,975,879 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | (2,799,002 | ) | | | | (400,175 | ) | | | | (600,900 | ) | | | | 2,144,258 | | | | | (2,652,650 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | (764,868 | ) | | | | 2,657,369 | | | | | 5,426,995 | | | | | 1,164,389 | | | | | 27,232,890 | |
| | | (41,790 | ) | | | | (98,341 | ) | | | | 4,297 | | | | | (14,196 | ) | | | | (122,943 | ) |
| | | — | | | | | (18,300 | ) | | | | (5 | ) | | | | — | | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | (806,658 | ) | | | | 2,540,728 | | | | | 5,431,287 | | | | | 1,150,193 | | | | | 27,109,947 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 14,793,210 | | | | | 853,514 | | | | | (8,809,064 | ) | | | | (9,449,585 | ) | | | | (207,571,962 | ) |
| | | 23,769 | | | | | (1,174,580 | ) | | | | 216 | | | | | (23,189 | ) | | | | (17,521 | ) |
| | | (1,880,195 | ) | | | | 32,459 | | | | | (102,706 | ) | | | | — | | | | | 38,445 | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 12,936,784 | | | | | (288,607 | ) | | | | (8,911,554 | ) | | | | (9,472,774 | ) | | | | (207,551,038 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | 12,130,126 | | | | | 2,252,121 | | | | | (3,480,267 | ) | | | | (8,322,581 | ) | | | | (180,441,091 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 9,331,124 | | | | $ | 1,851,946 | | | | $ | (4,081,167 | ) | | | $ | (6,178,323 | ) | | | $ | (183,093,741 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | |
75
Statements of Operations(continued)
| | | | | | | | | | | | | | | |
| | | INTERNATIONAL
OPPORTUNITIES
FUND | | MICRO
CAP
FUND | | MICRO CAP
VALUE
FUND |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Investment Income: | |
Interest | | | $ | 33,098 | | | | $ | 20,599 | | | | $ | 38,971 | |
Dividends1 | |
Unaffiliated issuers | | | | 1,626,792 | | | | | 991,031 | | | | | 1,094,791 | |
| | | | | | | | | | | | | | | |
Total investment income | | | | 1,659,890 | | | | | 1,011,630 | | | | | 1,133,762 | |
| | | | | | | | | | | | | | | |
Expenses: | |
Investment advisory fees | | | | 3,769,236 | | | | | 3,171,156 | | | | | 1,852,968 | |
Shareholder servicing fees — Investor Class | | | | 222,165 | | | | | 133,081 | | | | | 153,093 | |
Shareholder servicing fees — Institutional Class | | | | 83,269 | | | | | — | | | | | — | |
Fund administration fees | | | | 36,970 | | | | | 36,255 | | | | | 21,194 | |
Fund accounting fees | | | | 38,028 | | | | | 30,141 | | | | | 23,170 | |
Reports to shareholders — Investor Class | | | | 27,027 | | | | | 21,005 | | | | | 24,225 | |
Reports to shareholders — Institutional Class | | | | 27,201 | | | | | — | | | | | — | |
Custody fees | | | | 117,696 | | | | | 25,925 | | | | | 16,900 | |
Federal and state registration fees — Investor Class | | | | 9,959 | | | | | 22,121 | | | | | 15,561 | |
Federal and state registration fees — Institutional Class | | | | 10,761 | | | | | — | | | | | — | |
Legal fees | | | | 16,981 | | | | | 13,688 | | | | | 7,968 | |
Trustees’ fees | | | | 31,377 | | | | | 29,255 | | | | | 17,020 | |
Interest | | | | 48,194 | | | | | 12,052 | | | | | 4,110 | |
Audit fees | | | | 17,258 | | | | | 15,962 | | | | | 15,962 | |
Other expenses | | | | 34,424 | | | | | 22,735 | | | | | 14,011 | |
| | | | | | | | | | | | | | | |
Total expenses before reimbursement | | | | 4,490,546 | | | | | 3,533,376 | | | | | 2,166,182 | |
Reimbursement of expenses by Advisor | | | | (39,696 | ) | | | | — | | | | | — | |
| | | | | | | | | | | | | | | |
Net Expenses | | | | 4,450,850 | | | | | 3,533,376 | | | | | 2,166,182 | |
| | | | | | | | | | | | | | | |
Net Investment Income (Loss) | | | | (2,790,960 | ) | | | | (2,521,746 | ) | | | | (1,032,420 | ) |
| | | | | | | | | | | | | | | |
Realized Gain (Loss): | |
Investments sold | | | | 8,624,715 | | | | | 36,731,856 | | | | | 7,214,809 | |
Foreign currency transactions | | | | (102,123 | ) | | | | (35,721 | ) | | | | (19,222 | ) |
Foreign capital gains taxes | | | | — | | | | | — | | | | | — | |
| | | | | | | | | | | | | | | |
Net realized gain (loss) | | | | 8,522,592 | | | | | 36,696,135 | | | | | 7,195,587 | |
| | | | | | | | | | | | | | | |
Change in Unrealized Appreciation (Depreciation): | |
Investments | | | | (44,835,415 | ) | | | | (65,529,380 | ) | | | | (26,719,119 | ) |
Foreign currency translations | | | | (1,713 | ) | | | | 17 | | | | | 165 | |
Deferred foreign capital gains taxes | | | | — | | | | | 54,157 | | | | | (35,392 | ) |
| | | | | | | | | | | | | | | |
Net change in unrealized appreciation (depreciation) | | | | (44,837,128 | ) | | | | (65,475,206 | ) | | | | (26,754,346 | ) |
| | | | | | | | | | | | | | | |
Net gain (loss) on investments | | | | (36,314,536 | ) | | | | (28,779,071 | ) | | | | (19,558,759 | ) |
| | | | | | | | | | | | | | | |
Net Increase (Decrease) in Net Assets Resulting from Operations | | | $ | (39,105,496 | ) | | | $ | (31,300,817 | ) | | | $ | (20,591,179 | ) |
| | | | | | | | | | | | | | | |
| 1 | Net of $25,495, $41,698, $16,278, $0, $0, $1,095 and $0 in foreign withholding taxes, respectively. |
See Notes to Financial Statements.
76
| | |
| | FOR THE SIX MONTHS ENDED MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | | | | | | | | | |
SMALL CAP
GROWTH
FUND | | SMALL CAP
VALUE
FUND | | ULTRA
GROWTH
FUND | | U.S.
TREASURY
FUND |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | $ | 392,950 | | | | $ | 37,165 | | | | $ | 91,814 | | | | $ | 4,362,828 | |
| | | | | | | | | | | | | | | | | | | |
| | | 2,382,424 | | | | | 4,045,194 | | | | | 553,916 | | | | | — | |
| | | | | | | | | | | | | | | | | | | |
| | | 2,775,374 | | | | | 4,082,359 | | | | | 645,730 | | | | | 4,362,828 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | 8,158,831 | | | | | 2,189,814 | | | | | 1,642,956 | | | | | 744,744 | |
| | | 503,662 | | | | | 168,163 | | | | | 159,096 | | | | | 154,265 | |
| | | 7,086 | | | | | 1,580 | | | | | — | | | | | — | |
| | | 139,939 | | | | | 37,587 | | | | | 28,142 | | | | | 25,603 | |
| | | 85,243 | | | | | 29,051 | | | | | 24,332 | | | | | 17,330 | |
| | | 56,412 | | | | | 25,457 | | | | | 21,599 | | | | | 23,272 | |
| | | 50,145 | | | | | 5,245 | | | | | — | | | | | — | |
| | | 82,199 | | | | | 7,916 | | | | | 8,508 | | | | | 4,511 | |
| | | 17,693 | | | | | 17,874 | | | | | 26,483 | | | | | 26,701 | |
| | | 13,973 | | | | | 9,565 | | | | | — | | | | | — | |
| | | 53,001 | | | | | 12,851 | | | | | 8,467 | | | | | 8,919 | |
| | | 113,191 | | | | | 27,543 | | | | | 18,095 | | | | | 19,138 | |
| | | 63,062 | | | | | 6,681 | | | | | 6,859 | | | | | 4,451 | |
| | | 17,258 | | | | | 17,258 | | | | | 15,962 | | | | | 15,962 | |
| | | 46,536 | | | | | 16,728 | | | | | 11,365 | | | | | 8,516 | |
| | | | | | | | | | | | | | | | | | | |
| | | 9,408,231 | | | | | 2,573,313 | | | | | 1,971,864 | | | | | 1,053,412 | |
| | | (123,827 | ) | | | | (28,050 | ) | | | | — | | | | | — | |
| | | | | | | | | | | | | | | | | | | |
| | | 9,284,404 | | | | | 2,545,263 | | | | | 1,971,864 | | | | | 1,053,412 | |
| | | | | | | | | | | | | | | | | | | |
| | | (6,509,030 | ) | | | | 1,537,096 | | | | | (1,326,134 | ) | | | | 3,309,416 | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | 124,297,381 | | | | | (2,493,864 | ) | | | | 3,657,632 | | | | | (4,216,139 | ) |
| | | (5,051 | ) | | | | 1,349 | | | | | (1,584 | ) | | | | — | |
| | | — | | | | | — | | | | | (9,540 | ) | | | | — | |
| | | | | | | | | | | | | | | | | | | |
| | | 124,292,330 | | | | | (2,492,515 | ) | | | | 3,646,508 | | | | | (4,216,139 | ) |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | (180,952,063 | ) | | | | (22,295,223 | ) | | | | (4,312,403 | ) | | | | 29,065,633 | |
| | | (2,539 | ) | | | | — | | | | | 333 | | | | | — | |
| | | — | | | | | (52,994 | ) | | | | (98,398 | ) | | | | — | |
| | | | | | | | | | | | | | | | | | | |
| | | (180,954,602 | ) | | | | (22,348,217 | ) | | | | (4,410,468 | ) | | | | 29,065,633 | |
| | | | | | | | | | | | | | | | | | | |
| | | (56,662,272 | ) | | | | (24,840,732 | ) | | | | (763,960 | ) | | | | 24,849,494 | |
| | | | | | | | | | | | | | | | | | | |
| | $ | (63,171,302 | ) | | | $ | (23,303,636 | ) | | | $ | (2,090,094 | ) | | | $ | 28,158,910 | |
| | | | | | | | | | | | | | | | | | | |
77
Statements of Changes in Net Assets
| | | | | | | | | | | | | | | | | | | | |
| | |
CORE GROWTH
FUND | | EMERGING INDIA
FUND |
| | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 |
| | | | | | | | | | | | | | | | | | | | |
Operations: | | | | | | | | | | | | | | | | | | | | |
Net investment loss | | | $ | (5,037,845 | ) | | | $ | (11,608,205 | ) | | | $ | (1,534,146 | ) | | | $ | (3,026,610 | ) |
Net realized gain (loss) on investments, foreign
currency translations and foreign capital gains taxes | | | | 82,721,969 | | | | | 182,010,447 | | | | | (794,691 | ) | | | | 23,044,438 | |
Change in unrealized appreciation (depreciation) on investments, foreign currency translations and
deferred capital gains taxes | | | | (225,465,405 | ) | | | | 277,447,546 | | | | | 31,360,234 | | | | | (22,073,346 | ) |
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in net assets resulting from operations | | | | (147,781,281 | ) | | | | 447,849,788 | | | | | 29,031,397 | | | | | (2,055,518 | ) |
| | | | |
Distributions to shareholders from distributable earnings | | | | | | | | | | | | | | | | | | | | |
Investor Class | | | | (115,894,672 | ) | | | | (74,038,213 | ) | | | | (12,103,683 | ) | | | | (6,742,776 | ) |
Institutional Class | | | | (56,240,911 | ) | | | | (25,182,119 | ) | | | | (3,516,107 | ) | | | | (754,072 | ) |
| | | | |
Capital share transactions: | | | | | | | | | | | | | | | | | | | | |
Investor Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | 116,859,339 | | | | | 358,201,529 | | | | | 32,194,734 | | | | | 102,505,750 | |
Shares issued to holders in reinvestment of dividends | | | | 112,651,644 | | | | | 72,335,682 | | | | | 12,002,230 | | | | | 6,714,681 | |
Shares redeemed | | | | (183,242,897 | ) | | | | (315,840,657 | ) | | | | (43,293,842 | ) | | | | (125,799,692 | ) |
Redemption fees | | | | 95,685 | | | | | 44,161 | | | | | 18,177 | | | | | 102,468 | |
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) | | | | 46,363,771 | | | | | 114,740,715 | | | | | 921,299 | | | | | (16,476,793 | ) |
| | | | | | | | | | | | | | | | | | | | |
Institutional Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | 187,278,447 | | | | | 310,116,006 | | | | | 29,799,527 | | | | | 27,917,185 | |
Shares issued to holders in reinvestment of dividends | | | | 53,665,284 | | | | | 24,509,684 | | | | | 3,516,107 | | | | | 754,071 | |
Shares redeemed | | | | (101,820,414 | ) | | | | (92,409,153 | ) | | | | (7,980,292 | ) | | | | (7,140,599 | ) |
Redemption fees | | | | 23,827 | | | | | 21,866 | | | | | — | | | | | 391 | |
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) | | | | 139,147,144 | | | | | 242,238,403 | | | | | 25,335,342 | | | | | 21,531,048 | |
| | | | | | | | | | | | | | | | | | | | |
Total increase (decrease) in net assets | | | | (134,405,949 | ) | | | | 705,608,574 | | | | | 39,668,248 | | | | | (4,498,111 | ) |
| | | | |
Net assets: | | | | | | | | | | | | | | | | | | | | |
Beginning of period | | | | 2,299,856,165 | | | | | 1,594,247,591 | | | | | 227,190,388 | | | | | 231,688,499 | |
| | | | | | | | | | | | | | | | | | | | |
End of period | | | $ | 2,165,450,216 | | | | $ | 2,299,856,165 | | | | $ | 266,858,636 | | | | $ | 227,190,388 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | |
Capital share transactions — shares: | | | | | | | | | | | | | | | | | | | | |
Investor Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | 1,671,004 | | | | | 4,751,145 | | | | | 8,151,877 | | | | | 23,579,153 | |
Shares issued to holders in reinvestment of dividends | | | | 1,925,011 | | | | | 1,057,230 | | | | | 3,030,866 | | | | | 1,522,603 | |
Shares redeemed | | | | (2,711,277 | ) | | | | (4,300,532 | ) | | | | (11,238,181 | ) | | | | (29,275,298 | ) |
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in shares outstanding | | | | 884,738 | | | | | 1,507,843 | | | | | (55,438 | ) | | | | (4,173,542 | ) |
| | | | | | | | | | | | | | | | | | | | |
Institutional Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | 2,706,949 | | | | | 4,089,089 | | | | | 7,763,221 | | | | | 6,380,519 | |
Shares issued to holders in reinvestment of dividends | | | | 909,581 | | | | | 355,987 | | | | | 881,230 | | | | | 169,836 | |
Shares redeemed | | | | (1,484,505 | ) | | | | (1,246,310 | ) | | | | (2,044,547 | ) | | | | (1,651,902 | ) |
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in shares outstanding | | | | 2,132,025 | | | | | 3,198,766 | | | | | 6,599,904 | | | | | 4,898,453 | |
| | | | | | | | | | | | | | | | | | | | |
See Notes to Financial Statements.
78
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
EMERGING MARKETS
SELECT
FUND | | EMERGING MARKETS
SMALL CAP
FUND | | FRONTIER
EMERGING
SMALL COUNTRIES
FUND |
Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | (123,317 | ) | | | $ | (218,348 | ) | | | $ | (2,799,002 | ) | | | $ | (2,708,663 | ) | | | $ | (400,175 | ) | | | $ | (600,940 | ) |
| | | (468,409 | ) | | | | 4,430,589 | | | | | (806,658 | ) | | | | 61,110,392 | | | | | 2,540,728 | | | | | 43,378,391 | |
| | | 3,322,572 | | | | | (4,424,150 | ) | | | | 12,936,784 | | | | | (96,162,495 | ) | | | | (288,607 | ) | | | | (51,664,361 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2,730,846 | | | | | (211,909 | ) | | | | 9,331,124 | | | | | (37,760,766 | ) | | | | 1,851,946 | | | | | (8,886,910 | ) |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | — | | | | | — | | | | | (26,880,563 | ) | | | | — | | | | | — | | | | | — | |
| | | — | | | | | — | | | | | (22,096,890 | ) | | | | — | | | | | — | | | | | — | |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 763,113 | | | | | 2,193,564 | | | | | 16,010,894 | | | | | 45,521,661 | | | | | 2,049,893 | | | | | 8,969,259 | |
| | | — | | | | | — | | | | | 25,451,093 | | | | | — | | | | | — | | | | | — | |
| | | (4,254,880 | ) | | | | (3,946,229 | ) | | | | (75,564,806 | ) | | | | (131,435,723 | ) | | | | (14,105,023 | ) | | | | (99,486,901 | ) |
| | | 3,152 | | | | | 399 | | | | | 1,558 | | | | | 3,298 | | | | | 7,693 | | | | | 3,549 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | (3,488,615 | ) | | | | (1,752,266 | ) | | | | (34,101,261 | ) | | | | (85,910,764 | ) | | | | (12,047,437 | ) | | | | (90,514,093 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2,998,527 | | | | | 5,746,471 | | | | | 32,783,169 | | | | | 78,307,626 | | | | | 710,929 | | | | | 2,740,953 | |
| | | — | | | | | — | | | | | 20,773,470 | | | | | — | | | | | — | | | | | — | |
| | | (205,295 | ) | | | | (4,188,806 | ) | | | | (63,555,786 | ) | | | | (71,984,206 | ) | | | | (4,858,663 | ) | | | | (23,112,008 | ) |
| | | 312 | | | | | 7 | | | | | 4,612 | | | | | 54,542 | | | | | — | | | | | 35 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2,793,544 | | | | | 1,557,672 | | | | | (9,994,535 | ) | | | | 6,377,962 | | | | | (4,147,734 | ) | | | | (20,371,020 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2,035,775 | | | | | (406,503 | ) | | | | (83,742,125 | ) | | | | (117,293,568 | ) | | | | (14,343,225 | ) | | | | (119,772,023 | ) |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 43,735,132 | | | | | 44,141,635 | | | | | 526,432,324 | | | | | 643,725,892 | | | | | 77,992,210 | | | | | 197,764,233 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 45,770,907 | | | | $ | 43,735,132 | | | | $ | 442,690,199 | | | | $ | 526,432,324 | | | | $ | 63,648,985 | | | | $ | 77,992,210 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 76,896 | | | | | 199,186 | | | | | 6,566,068 | | | | | 14,614,067 | | | | | 840,063 | | | | | 3,178,358 | |
| | | — | | | | | — | | | | | 11,162,760 | | | | | — | | | | | — | | | | | — | |
| | | (418,192 | ) | | | | (358,486 | ) | | | | (30,726,350 | ) | | | | (42,517,719 | ) | | | | (5,784,963 | ) | | | | (36,982,253 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | (341,296 | ) | | | | (159,300 | ) | | | | (12,997,522 | ) | | | | (27,903,652 | ) | | | | (4,944,900 | ) | | | | (33,803,895 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 287,098 | | | | | 507,748 | | | | | 13,213,460 | | | | | 25,231,531 | | | | | 286,247 | | | | | 942,852 | |
| | | — | | | | | — | | | | | 9,071,384 | | | | | — | | | | | — | | | | | — | |
| | | (21,555 | ) | | | | (370,942 | ) | | | | (25,538,210 | ) | | | | (23,196,088 | ) | | | | (2,016,703 | ) | | | | (8,004,076 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 265,543 | | | | | 136,806 | | | | | (3,253,366 | ) | | | | 2,035,443 | | | | | (1,730,456 | ) | | | | (7,061,224 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
79
Statements of Changes in Net Assets(continued)
| | | | | | | | | | | | | | | | | | | | |
| | | GLOBAL OPPORTUNITIES
FUND | | GLOBAL VALUE
FUND |
| | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Operations: | |
Net investment income (loss) | | | $ | (600,900 | ) | | | $ | (868,395 | ) | | | $ | 2,144,258 | | | | $ | 3,663,381 | |
Net realized gain on investments, foreign
currency translations and foreign capital gains taxes | | | | 5,431,287 | | | | | 16,367,355 | | | | | 1,150,193 | | | | | 21,566,871 | |
Net realized gain on options written | �� | | | — | | | | | — | | | | | — | | | | | 41,716 | |
Change in unrealized appreciation (depreciation) on
investments, foreign currency translations and
deferred capital gains taxes | | | | (8,911,554 | ) | | | | 5,276,080 | | | | | (9,472,774 | ) | | | | (10,059,164 | ) |
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in net assets resulting from operations | | | | (4,081,167 | ) | | | | 20,775,040 | | | | | (6,178,323 | ) | | | | 15,212,804 | |
|
Distributions to shareholders from distributable earnings | |
Investor Class | | | | (13,508,893 | ) | | | | (10,116,438 | ) | | | | (23,871,402 | ) | | | | (25,233,408 | ) |
Institutional Class | | | | (2,069,212 | ) | | | | (782,771 | ) | | | | (1,227,186 | ) | | | | (720,421 | ) |
|
Capital share transactions: | |
Investor Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | 7,803,556 | | | | | 22,249,432 | | | | | 3,294,753 | | | | | 7,657,799 | |
Shares issued to holders in connection with acquisition | | | | — | | | | | — | | | | | — | | | | | 39,139,789 | |
Shares issued to holders in reinvestment of dividends | | | | 13,261,384 | | | | | 10,031,552 | | | | | 23,607,613 | | | | | 25,041,958 | |
Shares redeemed | | | | (15,153,008 | ) | | | | (26,188,981 | ) | | | | (26,981,688 | ) | | | | (44,302,978 | ) |
Redemption fees | | | | 2,449 | | | | | 4,814 | | | | | 3,442 | | | | | 1,397 | |
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) | | | | 5,914,381 | | | | | 6,096,817 | | | | | (75,880 | ) | | | | 27,537,965 | |
| | | | | | | | | | | | | | | | | | | | |
Institutional Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | 4,385,049 | | | | | 7,932,736 | | | | | 439,860 | | | | | 608,303 | |
Shares issued to holders in connection with acquisition | | | | — | | | | | — | | | | | — | | | | | 5,168,422 | |
Shares issued to holders in reinvestment of dividends | | | | 1,897,943 | | | | | 653,577 | | | | | 1,202,368 | | | | | 715,126 | |
Shares redeemed | | | | (2,582,293 | ) | | | | (802,638 | ) | | | | (1,324,719 | ) | | | | (1,186,958 | ) |
Redemption fees | | | | 2,232 | | | | | — | | | | | 48 | | | | | 316 | |
| | | | | | | | | | | | | | | | | | | | |
Net increase | | | | 3,702,931 | | | | | 7,783,675 | | | | | 317,557 | | | | | 5,305,209 | |
| | | | | | | | | | | | | | | | | | | | |
Total increase (decrease) in net assets | | | | (10,041,960 | ) | | | | 23,756,323 | | | | | (31,035,234 | ) | | | | 22,102,149 | |
|
Net assets: | |
Beginning of period | | | | 126,753,020 | | | | | 102,996,697 | | | | | 202,425,610 | | | | | 180,323,461 | |
| | | | | | | | | | | | | | | | | | | | |
End of period | | | $ | 116,711,060 | | | | $ | 126,753,020 | | | | $ | 171,390,376 | | | | $ | 202,425,610 | |
| | | | | | | | | | | | | | | | | | | | |
|
Capital share transactions — shares: | |
Investor Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | 2,428,870 | | | | | 5,630,302 | | | | | 413,570 | | | | | 847,365 | |
Shares issued to holders in connection with acquisition | | | | — | | | | | — | | | | | — | | | | | 4,198,411 | |
Shares issued to holders in reinvestment of dividends | | | | 4,736,209 | | | | | 2,725,965 | | | | | 3,320,703 | | | | | 2,818,313 | |
Shares redeemed | | | | (4,542,387 | ) | | | | (6,742,741 | ) | | | | (3,420,322 | ) | | | | (4,812,767 | ) |
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in shares outstanding | | | | 2,622,692 | | | | | 1,613,526 | | | | | 313,951 | | | | | 3,051,322 | |
| | | | | | | | | | | | | | | | | | | | |
Institutional Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | 1,409,913 | | | | | 2,002,122 | | | | | 52,364 | | | | | 66,961 | |
Shares issued to holders in connection with acquisition | | | | — | | | | | — | | | | | — | | | | | 554,971 | |
Shares issued to holders in reinvestment of dividends | | | | 675,424 | | | | | 177,603 | | | | | 169,306 | | | | | 80,502 | |
Shares redeemed | | | | (770,995 | ) | | | | (205,199 | ) | | | | (166,321 | ) | | | | (129,575 | ) |
| | | | | | | | | | | | | | | | | | | | |
Net increase in shares outstanding | | | | 1,314,342 | | | | | 1,974,526 | | | | | 55,349 | | | | | 572,859 | |
| | | | | | | | | | | | | | | | | | | | |
See Notes to Financial Statements.
80
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
INTERNATIONAL GROWTH
FUND | | INTERNATIONAL OPPORTUNITIES
FUND | | MICRO CAP
FUND |
Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | (2,652,650 | ) | | | $ | 1,327,395 | | | | $ | (2,790,960 | ) | | | $ | (4,986,097 | ) | | | $ | (2,521,746 | ) | | | $ | (4,910,798 | ) |
| | | 27,109,947 | | | | | 174,371,928 | | | | | 8,522,592 | | | | | 11,093,148 | | | | | 36,696,135 | | | | | 91,831,716 | |
| | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | (207,551,038 | ) | | | | 5,548,459 | | | | | (44,837,128 | ) | | | | 44,680,094 | | | | | (65,475,206 | ) | | | | 39,089,875 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | (183,093,741 | ) | | | | 181,247,782 | | | | | (39,105,496 | ) | | | | 50,787,145 | | | | | (31,300,817 | ) | | | | 126,010,793 | |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | (85,858,576 | ) | | | | (21,443,568 | ) | | | | (5,015,701 | ) | | | | (17,973,730 | ) | | | | (87,356,742 | ) | | | | (44,480,704 | ) |
| | | (85,816,934 | ) | | | | (19,841,666 | ) | | | | (6,283,811 | ) | | | | (16,042,894 | ) | | | | — | | | | | — | |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 66,335,267 | | | | | 91,347,750 | | | | | 7,325,843 | | | | | 18,056,611 | | | | | 55,675,454 | | | | | 136,695,602 | |
| | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | 79,082,010 | | | | | 20,391,366 | | | | | 4,816,572 | | | | | 17,102,675 | | | | | 82,402,243 | | | | | 41,927,060 | |
| | | (108,254,936 | ) | | | | (236,312,491 | ) | | | | (91,771,976 | ) | | | | (68,604,554 | ) | | | | (68,293,846 | ) | | | | (75,674,016 | ) |
| | | 9,487 | | | | | 6,992 | | | | | 148 | | | | | 1,351 | | | | | 157,831 | | | | | 66,098 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 37,171,828 | | | | | (124,566,383 | ) | | | | (79,629,413 | ) | | | | (33,443,917 | ) | | | | 69,941,682 | | | | | 103,014,744 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 135,487,446 | | | | | 273,956,806 | | | | | 39,588,260 | | | | | 84,972,195 | | | | | — | | | | | — | |
| | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | 80,888,826 | | | | | 18,746,866 | | | | | 4,723,790 | | | | | 12,562,516 | | | | | — | | | | | — | |
| | | (187,479,502 | ) | | | | (203,784,419 | ) | | | | (33,548,585 | ) | | | | (48,703,591 | ) | | | | — | | | | | — | |
| | | 13,799 | | | | | 381 | | | | | 2,082 | | | | | 1,905 | | | | | — | | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 28,910,569 | | | | | 88,919,634 | | | | | 10,765,547 | | | | | 48,833,025 | | | | | — | | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | (288,686,854 | ) | | | | 104,315,799 | | | | | (119,268,874 | ) | | | | 32,159,629 | | | | | (48,715,877 | ) | | | | 184,544,833 | |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 1,565,788,721 | | | | | 1,461,472,922 | | | | | 532,833,733 | | | | | 500,674,104 | | | | | 496,128,083 | | | | | 311,583,250 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 1,277,101,867 | | | | $ | 1,565,788,721 | | | | $ | 413,564,859 | | | | $ | 532,833,733 | | | | $ | 447,412,206 | | | | $ | 496,128,083 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2,393,084 | | | | | 2,553,941 | | | | | 2,336,704 | | | | | 5,128,419 | | | | | 7,384,986 | | | | | 15,566,533 | |
| | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | 3,267,852 | | | | | 595,542 | | | | | 1,684,116 | | | | | 4,957,297 | | | | | 14,256,443 | | | | | 5,459,253 | |
| | | (3,938,131 | ) | | | | (6,660,899 | ) | | | | (30,608,911 | ) | | | | (19,470,757 | ) | | | | (9,110,715 | ) | | | | (8,577,892 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 1,722,805 | | | | | (3,511,416 | ) | | | | (26,588,091 | ) | | | | (9,385,041 | ) | | | | 12,530,714 | | | | | 12,447,894 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 4,891,786 | | | | | 7,763,822 | | | | | 12,578,101 | | | | | 23,864,087 | | | | | — | | | | | — | |
| | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | 3,332,873 | | | | | 546,715 | | | | | 1,628,893 | | | | | 3,609,918 | | | | | — | | | | | — | |
| | | (6,640,973 | ) | | | | (5,638,547 | ) | | | | (10,683,079 | ) | | | | (13,694,830 | ) | | | | — | | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 1,583,686 | | | | | 2,671,990 | | | | | 3,523,915 | | | | | 13,779,175 | | | | | — | | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
81
Statements of Changes in Net Assets(continued)
| | | | | | | | | | | | | | | | | | | | |
| | | MICRO CAP VALUE
FUND | | SMALL CAP GROWTH
FUND |
| | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 |
| | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Operations: | |
Net investment income (loss) | | | $ | (1,032,420 | ) | | | $ | (2,253,111 | ) | | | $ | (6,509,030 | ) | | | $ | (13,963,609 | ) |
Net realized gain (loss) on investments, foreign
currency translations and foreign capital gains taxes | | | | 7,195,587 | | | | | 31,041,260 | | | | | 124,292,330 | | | | | 423,006,005 | |
Change in unrealized appreciation (depreciation) on investments, foreign currency translations and
deferred capital gains taxes | | | | (26,754,346 | ) | | | | 14,912,764 | | | | | (180,954,602 | ) | | | | 121,557,266 | |
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in net assets resulting from operations | | | | (20,591,179 | ) | | | | 43,700,913 | | | | | (63,171,302 | ) | | | | 530,599,662 | |
| | | | |
Distributions to shareholders from distributable earnings | | | | | | | | | | | | | | | | | | | | |
Investor Class | | | | (26,873,692 | ) | | | | (17,823,539 | ) | | | | (254,160,201 | ) | | | | (123,041,326 | ) |
Institutional Class | | | | — | | | | | — | | | | | (160,748,953 | ) | | | | (54,835,253 | ) |
| | | | |
Capital share transactions: | | | | | | | | | | | | | | | | | | | | |
Investor Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | 23,528,153 | | | | | 76,281,206 | | | | | 47,171,802 | | | | | 103,483,962 | |
Shares issued to holders in reinvestment of dividends | | | | 26,433,514 | | | | | 17,525,660 | | | | | 244,434,466 | | | | | 119,583,666 | |
Shares redeemed | | | | (35,239,741 | ) | | | | (52,176,052 | ) | | | | (153,882,271 | ) | | | | (460,000,362 | ) |
Redemption fees | | | | 11,679 | | | | | 27,574 | | | | | 7,330 | | | | | 12,208 | |
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) | | | | 14,733,605 | | | | | 41,658,388 | | | | | 137,731,327 | | | | | (236,920,526 | ) |
| | | | | | | | | | | | | | | | | | | | |
Institutional Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | — | | | | | — | | | | | 102,273,153 | | | | | 218,762,228 | |
Shares issued to holders in reinvestment of dividends | | | | — | | | | | — | | | | | 150,566,964 | | | | | 51,205,368 | |
Shares redeemed | | | | — | | | | | — | | | | | (116,671,392 | ) | | | | (191,739,249 | ) |
Redemption fees | | | | — | | | | | — | | | | | 20,121 | | | | | 16,558 | |
| | | | | | | | | | | | | | | | | | | | |
Net increase | | | | — | | | | | — | | | | | 136,188,846 | | | | | 78,244,905 | |
| | | | | | | | | | | | | | | | | | | | |
Total increase (decrease) in net assets | | | | (32,731,266 | ) | | | | 67,535,762 | | | | | (204,160,283 | ) | | | | 194,047,462 | |
| | | | |
Net assets: | | | | | | | | | | | | | | | | | | | | |
Beginning of period | | | | 283,622,986 | | | | | 216,087,224 | | | | | 1,884,992,510 | | | | | 1,690,945,048 | |
| | | | | | | | | | | | | | | | | | | | |
End of period | | | $ | 250,891,720 | | | | $ | 283,622,986 | | | | $ | 1,680,832,227 | | | | $ | 1,884,992,510 | |
| | | | | | | | | | | | | | | | | | | | |
| | | | |
Capital share transactions — shares: | | | | | | | | | | | | | | | | | | | | |
Investor Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | 7,587,200 | | | | | 21,640,833 | | | | | 1,207,113 | | | | | 2,095,912 | |
Shares issued to holders in reinvestment of dividends | | | | 9,863,251 | | | | | 5,109,522 | | | | | 7,801,930 | | | | | 2,752,847 | |
Shares redeemed | | | | (11,377,571 | ) | | | | (14,782,849 | ) | | | | (4,074,949 | ) | | | | (9,540,169 | ) |
| | | | | | | | | | | | | | | | | | | | |
Net increase (decrease) in shares outstanding | | | | 6,072,880 | | | | | 11,967,506 | | | | | 4,934,094 | | | | | (4,691,410 | ) |
| | | | | | | | | | | | | | | | | | | | |
Institutional Class | | | | | | | | | | | | | | | | | | | | |
Shares sold | | | | — | | | | | — | | | | | 2,599,958 | | | | | 4,404,164 | |
Shares issued to holders in reinvestment of dividends | | | | — | | | | | — | | | | | 4,766,286 | | | | | 1,173,359 | |
Shares redeemed | | | | — | | | | | — | | | | | (3,024,389 | ) | | | | (3,812,497 | ) |
| | | | | | | | | | | | | | | | | | | | |
Net increase in shares outstanding | | | | — | | | | | — | | | | | 4,341,855 | | | | | 1,765,026 | |
| | | | | | | | | | | | | | | | | | | | |
See Notes to Financial Statements.
82
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
SMALL CAP VALUE
FUND | | ULTRA GROWTH
FUND | | U.S. TREASURY
FUND |
Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 | | Six Months
Ended
March 31, 2019
(Unaudited) | | Year Ended
September 30, 2018 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 1,537,096 | | | | $ | 1,261,322 | | | | $ | (1,326,134 | ) | | | $ | (1,575,188 | ) | | | $ | 3,309,416 | | | | $ | 7,026,013 | |
| | | (2,492,515 | ) | | | | 38,340,537 | | | | | 3,646,508 | | | | | 23,738,921 | | | | | (4,216,139 | ) | | | | (1,506,576 | ) |
| | | (22,348,217 | ) | | | | 14,364,249 | | | | | (4,410,468 | ) | | | | 32,475,237 | | | | | 29,065,633 | | | | | (20,060,898 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | (23,303,636 | ) | | | | 53,966,108 | | | | | (2,090,094 | ) | | | | 54,638,970 | | | | | 28,158,910 | | | | | (14,541,461 | ) |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | (24,527,924 | ) | | | | (20,987,095 | ) | | | | (18,922,846 | ) | | | | (12,347,975 | ) | | | | (3,312,768 | ) | | | | (7,001,515 | ) |
| | | (7,190,903 | ) | | | | (3,592,448 | ) | | | | — | | | | | — | | | | | — | | | | | — | |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 70,408,891 | | | | | 43,736,056 | | | | | 279,872,375 | | | | | 165,853,614 | | | | | 87,494,175 | | | | | 81,723,309 | |
| | | 23,919,067 | | | | | 20,420,605 | | | | | 17,633,875 | | | | | 12,027,369 | | | | | 3,055,329 | | | | | 6,519,228 | |
| | | (27,309,526 | ) | | | | (62,665,103 | ) | | | | (77,266,647 | ) | | | | (34,017,446 | ) | | | | (90,561,670 | ) | | | | (124,477,163 | ) |
| | | 16,511 | | | | | 5,767 | | | | | 179,542 | | | | | 41,794 | | | | | 100,890 | | | | | 17,262 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 67,034,943 | | | | | 1,497,325 | | | | | 220,419,145 | | | | | 143,905,331 | | | | | 88,724 | | | | | (36,217,364 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 51,144,768 | | | | | 44,009,151 | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | 6,896,928 | | | | | 3,561,193 | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | (7,178,266 | ) | | | | (9,949,041 | ) | | | | — | | | | | — | | | | | — | | | | | — | |
| | | 904 | | | | | 171 | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 50,864,334 | | | | | 37,621,474 | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 62,876,814 | | | | | 68,505,364 | | | | | 199,406,205 | | | | | 186,196,326 | | | | | 24,934,866 | | | | | (57,760,340 | ) |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 439,154,812 | | | | | 370,649,448 | | | | | 297,561,949 | | | | | 111,365,623 | | | | | 303,105,424 | | | | | 360,865,764 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | $ | 502,031,626 | | | | $ | 439,154,812 | | | | $ | 496,968,154 | | | | $ | 297,561,949 | | | | $ | 328,040,290 | | | | $ | 303,105,424 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 9,653,238 | | | | | 5,320,230 | | | | | 11,595,553 | | | | | 6,439,623 | | | | | 5,682,084 | | | | | 5,144,647 | |
| | | 3,662,951 | | | | | 2,565,403 | | | | | 869,520 | | | | | 583,853 | | | | | 188,728 | | | | | 407,089 | |
| | | (3,686,047 | ) | | | | (7,616,110 | ) | | | | (3,320,040 | ) | | | | (1,379,623 | ) | | | | (5,926,103 | ) | | | | (7,804,349 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 9,630,142 | | | | | 269,523 | | | | | 9,145,033 | | | | | 5,643,853 | | | | | (55,291 | ) | | | | (2,252,613 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 6,920,527 | | | | | 5,233,966 | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | 1,049,760 | | | | | 445,149 | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | (992,238 | ) | | | | (1,196,895 | ) | | | | — | | | | | — | | | | | — | | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 6,978,049 | | | | | 4,482,220 | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
83
Financial Highlights
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | Income (Loss) from
Investment Operations | | | | | | Less Distributions | | |
| | | Net Asset
Value
Beginning
of Period | | Net
Investment
Income (Loss) | | Net Realized
and Unrealized
Gains (Losses)
on Investments | | Total from
Investment
Operations | | Redemption
Fees
(See Note 2) | | Dividends
from Net
Investment
Income | | Distributions
from Net
Realized
Gains | | Total
Distributions |
Core Growth Fund — Investor Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 81.04 | | | | | (0.16 | ) | | | | (5.92 | ) | | | | (6.08 | ) | | | | — | 4 | | | | — | | | | | (6.06 | ) | | | | (6.06 | ) |
Year ended 9/30/18 | | | $ | 67.44 | | | | | (0.43 | ) | | | | 18.30 | | | | | 17.87 | | | | | — | 4 | | | | — | | | | | (4.27 | ) | | | | (4.27 | ) |
Year ended 9/30/17 | | | $ | 56.90 | | | | | (0.50 | ) | | | | 11.13 | | | | | 10.63 | | | | | — | 4 | | | | — | | | | | (0.09 | ) | | | | (0.09 | ) |
Year ended 9/30/1616 | | | $ | 57.83 | | | | | (0.30 | ) | | | | 6.09 | | | | | 5.79 | | | | | — | 4 | | | | — | | | | | (6.72 | ) | | | | (6.72 | ) |
Year ended 9/30/15 | | | $ | 53.46 | | | | | (0.14 | )9 | | | | 5.95 | | | | | 5.81 | | | | | — | 4 | | | | — | | | | | (1.44 | ) | | | | (1.44 | ) |
Year ended 9/30/14 | | | $ | 52.49 | | | | | (0.39 | ) | | | | 2.12 | | | | | 1.73 | | | | | — | 4 | | | | — | | | | | (0.76 | ) | | | | (0.76 | ) |
Core Growth Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 81.62 | | | | | (0.09 | ) | | | | (5.97 | ) | | | | (6.06 | ) | | | | — | 4 | | | | — | | | | | (6.06 | ) | | | | (6.06 | ) |
Year ended 9/30/18 | | | $ | 67.81 | | | | | (0.21 | ) | | | | 18.29 | | | | | 18.08 | | | | | — | 4 | | | | — | | | | | (4.27 | ) | | | | (4.27 | ) |
Year ended 9/30/17 | | | $ | 57.16 | | | | | (0.30 | ) | | | | 11.07 | | | | | 10.77 | | | | | — | 4 | | | | (0.03 | ) | | | | (0.09 | ) | | | | (0.12 | ) |
Year ended 9/30/1616 | | | $ | 57.99 | | | | | (0.14 | ) | | | | 6.03 | | | | | 5.89 | | | | | — | 4 | | | | — | | | | | (6.72 | ) | | | | (6.72 | ) |
Year ended 9/30/15 | | | $ | 53.58 | | | | | 0.06 | 9 | | | | 5.79 | | | | | 5.85 | | | | | — | 4 | | | | — | | | | | (1.44 | ) | | | | (1.44 | ) |
Year ended 9/30/14 | | | $ | 52.57 | | | | | (0.23 | ) | | | | 2.00 | | | | | 1.77 | | | | | — | 4 | | | | — | | | | | (0.76 | ) | | | | (0.76 | ) |
Emerging India Fund — Investor Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 3.95 | | | | | (0.03 | ) | | | | 0.51 | | | | | 0.48 | | | | | — | 4 | | | | — | | | | | (0.27 | ) | | | | (0.27 | ) |
Year ended 9/30/18 | | | $ | 4.08 | | | | | (0.06 | ) | | | | 0.06 | | | | | — | | | | | — | 4 | | | | — | | | | | (0.13 | ) | | | | (0.13 | ) |
Year ended 9/30/17 | | | $ | 3.39 | | | | | 0.02 | 17 | | | | 0.70 | | | | | 0.72 | | | | | — | 4 | | | | — | | | | | (0.03 | ) | | | | (0.03 | ) |
Year ended 9/30/1616 | | | $ | 3.07 | | | | | (0.03 | ) | | | | 0.39 | | | | | 0.36 | | | | | — | 4 | | | | — | | | | | (0.04 | ) | | | | (0.04 | ) |
Year ended 9/30/15 | | | $ | 2.73 | | | | | (0.04 | ) | | | | 0.38 | | | | | 0.34 | | | | | — | 4 | | | | — | 4 | | | | — | | | | | — | 4 |
Year ended 9/30/14 | | | $ | 1.78 | | | | | (— | )4 | | | | 0.95 | | | | | 0.95 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Emerging India Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 3.97 | | | | | (0.01 | ) | | | | 0.50 | | | | | 0.49 | | | | | — | 4 | | | | — | | | | | (0.27 | ) | | | | (0.27 | ) |
Year ended 9/30/18 | | | $ | 4.10 | | | | | — | 4 | | | | — | 4 | | | | — | 4 | | | | — | 4 | | | | — | | | | | (0.13 | ) | | | | (0.13 | ) |
Year ended 9/30/17 | | | $ | 3.40 | | | | | 0.02 | 17 | | | | 0.71 | | | | | 0.73 | | | | | — | 4 | | | | — | | | | | (0.03 | ) | | | | (0.03 | ) |
Period ended 9/30/1614 16 | | | $ | 2.82 | | | | | (0.01 | ) | | | | 0.59 | | | | | 0.58 | | | | | — | | | | | — | | | | | — | | | | | — | |
Emerging Markets Select Fund — Investor Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 10.40 | | | | | (0.10 | ) | | | | 0.76 | | | | | 0.66 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/18 | | | $ | 10.46 | | | | | (0.09 | ) | | | | 0.03 | | | | | (0.06 | ) | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/17 | | | $ | 9.23 | | | | | (0.03 | ) | | | | 1.26 | | | | | 1.23 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/1616 | | | $ | 8.35 | | | | | (0.05 | ) | | | | 0.93 | | | | | 0.88 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/15 | | | $ | 10.31 | | | | | (0.04 | ) | | | | (1.89 | ) | | | | (1.93 | ) | | | | — | 4 | | | | (0.03 | ) | | | | — | | | | | (0.03 | ) |
Year ended 9/30/14 | | | $ | 9.56 | | | | | (0.01 | ) | | | | 0.77 | | | | | 0.76 | | | | | — | 4 | | | | (0.01 | ) | | | | — | | | | | (0.01 | ) |
Emerging Markets Select Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 10.56 | | | | | (0.02 | ) | | | | 0.71 | | | | | 0.69 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/18 | | | $ | 10.60 | | | | | (0.04 | ) | | | | — | 4 | | | | (0.04 | ) | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/17 | | | $ | 9.32 | | | | | (0.01 | ) | | | | 1.29 | | | | | 1.28 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/1616 | | | $ | 8.41 | | | | | 0.04 | | | | | 0.87 | | | | | 0.91 | | | | | — | | | | | — | | | | | — | | | | | — | |
Year ended 9/30/15 | | | $ | 10.37 | | | | | (0.03 | ) | | | | (1.88 | ) | | | | (1.91 | ) | | | | — | 4 | | | | (0.05 | ) | | | | — | | | | | (0.05 | ) |
Year ended 9/30/14 | | | $ | 9.61 | | | | | — | 4 | | | | 0.78 | | | | | 0.78 | | | | | — | 4 | | | | (0.02 | ) | | | | — | | | | | (0.02 | ) |
Emerging Markets Small Cap Fund — Investor Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 2.78 | | | | | (0.02 | ) | | | | 0.09 | | | | | 0.07 | | | | | — | 4 | | | | — | | | | | (0.30 | ) | | | | (0.30 | ) |
Year ended 9/30/18 | | | $ | 2.99 | | | | | (0.03 | ) | | | | (0.18 | ) | | | | (0.21 | ) | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/17 | | | $ | 2.67 | | | | | (0.04 | ) | | | | 0.36 | | | | | 0.32 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/1616 | | | $ | 2.39 | | | | | (0.04 | ) | | | | 0.32 | | | | | 0.28 | | | | | — | 4 | | | | — | 4 | | | | — | | | | | — | 4 |
Year ended 9/30/15 | | | $ | 2.74 | | | | | (0.03 | ) | | | | (0.32 | ) | | | | (0.35 | ) | | | | — | 4 | | | | — | 4 | | | | — | | | | | — | 4 |
Year ended 9/30/14 | | | $ | 2.67 | | | | | (0.01 | ) | | | | 0.14 | | | | | 0.13 | | | | | — | 4 | | | | — | | | | | (0.06 | ) | | | | (0.06 | ) |
Emerging Markets Small Cap Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 2.79 | | | | | (0.01 | ) | | | | 0.09 | | | | | 0.08 | | | | | — | 4 | | | | — | | | | | (0.30 | ) | | | | (0.30 | ) |
Year ended 9/30/18 | | | $ | 3.00 | | | | | (0.01 | ) | | | | (0.20 | ) | | | | (0.21 | ) | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/17 | | | $ | 2.67 | | | | | 0.01 | | | | | 0.32 | | | | | 0.33 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Period ended 9/30/1614 16 | | | $ | 2.31 | | | | | (— | )4 | | | | 0.36 | | | | | 0.36 | | | | | — | | | | | — | | | | | — | | | | | — | |
Frontier Emerging Small Countries Fund — Investor Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 2.51 | | | | | (0.04 | ) | | | | 0.14 | | | | | 0.10 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/18 | | | $ | 2.75 | | | | | (0.11 | ) | | | | (0.13 | ) | | | | (0.24 | ) | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/17 | | | $ | 2.63 | | | | | (0.08 | ) | | | | 0.20 | | | | | 0.12 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/1616 | | | $ | 2.77 | | | | | 0.02 | | | | | (0.16 | ) | | | | (0.14 | ) | | | | — | 4 | | | | — | 4 | | | | — | | | | | — | 4 |
Year ended 9/30/15 | | | $ | 3.32 | | | | | 0.02 | | | | | (0.50 | ) | | | | (0.48 | ) | | | | — | 4 | | | | (0.02 | ) | | | | (0.05 | ) | | | | (0.07 | ) |
Year ended 9/30/14 | | | $ | 2.97 | | | | | 0.03 | | | | | 0.33 | | | | | 0.36 | | | | | — | 4 | | | | (0.01 | ) | | | | — | | | | | (0.01 | ) |
See Notes to Financial Highlights and Notes to Financial Statements.
84
| | |
| | (for a share outstanding throughout each period) |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | |
Ratios to Average Net Assets | | | Supplemental Data | |
Net Asset
Value
End of
Period | | | Total Return (%)1 | | | Expenses Net of Waivers and
Reimbursements (%)2 | | | Expenses Before Waivers and
Reimbursements (%)2 | | | Net Investment
Income (Loss) Net
of Waivers and
Reimbursements (%)2 | | | Net Investment
Income (Loss) Before Waivers and
Reimbursements (%)2 | | | Net Assets
End of
Period
(000s) | | | Portfolio
Turnover
Rate1 3 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 68.90 | | | | (6.18 | ) | | | 1.19 | 5 | | | 1.19 | 5 | | | (0.53 | ) | | | (0.53 | ) | | $ | 1,402,277 | | | | 16% | |
| $ | 81.04 | | | | 27.66 | | | | 1.18 | 5 8 | | | 1.18 | 5 8 | | | (0.66 | ) | | | (0.66 | ) | | $ | 1,577,554 | | | | 27% | |
| $ | 67.44 | | | | 18.69 | | | | 1.21 | 5 | | | 1.21 | 5 | | | (0.78 | ) | | | (0.78 | ) | | $ | 1,211,089 | | | | 26% | |
| $ | 56.90 | | | | 10.69 | | | | 1.21 | 5 | | | 1.21 | 5 | | | (0.62 | ) | | | (0.62 | ) | | $ | 1,082,679 | | | | 18% | |
| $ | 57.83 | | | | 10.87 | | | | 1.17 | 5 | | | 1.17 | 5 | | | (0.29 | )9 | | | (0.29 | )9 | | $ | 1,014,515 | | | | 39% | |
| $ | 53.46 | | | | 3.26 | | | | 1.18 | 5 | | | 1.18 | 5 | | | (0.64 | ) | | | (0.64 | ) | | $ | 859,086 | | | | 26% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 69.50 | | | | (6.11 | ) | | | 1.05 | 5 | | | 1.09 | 5 | | | (0.39 | ) | | | (0.43 | ) | | $ | 763,173 | | | | 16% | |
| $ | 81.62 | | | | 27.82 | | | | 1.06 | 5 8 | | | 1.08 | 5 8 | | | (0.53 | ) | | | (0.55 | ) | | $ | 722,302 | | | | 27% | |
| $ | 67.81 | | | | 18.87 | | | | 1.05 | 5 | | | 1.10 | 5 | | | (0.63 | ) | | | (0.67 | ) | | $ | 383,159 | | | | 26% | |
| $ | 57.16 | | | | 10.83 | | | | 1.07 | 5 | | | 1.09 | 5 | | | (0.48 | ) | | | (0.50 | ) | | $ | 251,181 | | | | 18% | |
| $ | 57.99 | | | | 10.94 | | | | 1.12 | 5 | | | 1.13 | 5 | | | (0.29 | )9 | | | (0.30 | )9 | | $ | 150,614 | | | | 39% | |
| $ | 53.58 | | | | 3.31 | | | | 1.13 | 5 | | | 1.19 | 5 | | | (0.59 | ) | | | (0.65 | )5 | | $ | 49,369 | | | | 26% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 4.16 | | | | 12.62 | | | | 1.72 | 5 | | | 1.72 | 5 | | | (1.36 | ) | | | (1.36 | ) | | $ | 194,422 | | | | 9% | |
| $ | 3.95 | | | | (0.33 | ) | | | 1.71 | 6 7 | | | 1.71 | 6 7 | | | (1.22 | ) | | | (1.22 | ) | | $ | 184,733 | | | | 48% | |
| $ | 4.08 | | | | 21.65 | | | | 1.73 | 5 | | | 1.73 | 5 | | | (0.92 | ) | | | (0.92 | ) | | $ | 207,949 | | | | 17% | |
| $ | 3.39 | | | | 11.98 | | | | 1.82 | 5 | | | 1.96 | 5 | | | (1.18 | ) | | | (1.32 | ) | | $ | 71,973 | | | | 42% | |
| $ | 3.07 | | | | 12.51 | | | | 1.95 | 5 | | | 2.12 | 5 | | | (1.38 | ) | | | (1.55 | ) | | $ | 63,850 | | | | 36% | |
| $ | 2.73 | | | | 53.37 | | | | 1.96 | 5 | | | 2.58 | 5 | | | (0.76 | ) | | | (1.38 | ) | | $ | 44,150 | | | | 13% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 4.19 | | | | 12.81 | | | | 1.51 | 5 | | | 1.55 | 5 | | | (1.13 | ) | | | (1.18 | )5 | | $ | 72,437 | | | | 9% | |
| $ | 3.97 | | | | (0.33 | ) | | | 1.51 | 6 8 | | | 1.60 | 6 8 | | | (0.93 | ) | | | (1.02 | ) | | $ | 42,457 | | | | 48% | |
| $ | 4.10 | | | | 21.89 | | | | 1.50 | 5 | | | 1.67 | 5 | | | (0.77 | ) | | | (0.94 | ) | | $ | 23,739 | | | | 17% | |
| $ | 3.40 | | | | 20.57 | | | | 1.50 | 5 | | | 2.00 | 5 | | | (0.70 | ) | | | (1.20 | ) | | $ | 9,799 | | | | 42% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 11.06 | | | | 6.35 | | | | 1.51 | 5 | | | 2.12 | 5 | | | (0.82 | ) | | | (1.44 | ) | | $ | 10,606 | | | | 4% | |
| $ | 10.40 | | | | (0.57 | ) | | | 1.51 | 6 8 | | | 1.76 | 6 8 | | | (0.67 | ) | | | (0.92 | ) | | $ | 13,520 | | | | 44% | |
| $ | 10.46 | | | | 13.33 | | | | 1.51 | 6 | | | 1.90 | 6 | | | (0.38 | ) | | | (0.76 | ) | | $ | 15,273 | | | | 55% | |
| $ | 9.23 | | | | 10.54 | | | | 1.58 | 6 | | | 1.98 | 6 | | | (0.15 | ) | | | (0.55 | ) | | $ | 11,892 | | | | 62% | |
| $ | 8.35 | | | | (18.81 | ) | | | 1.70 | 6 | | | 2.00 | 6 | | | (0.23 | ) | | | (0.53 | ) | | $ | 18,527 | | | | 46% | |
| $ | 10.31 | | | | 7.92 | | | | 1.69 | 5 | | | 1.88 | 5 | | | (0.09 | ) | | | (0.28 | ) | | $ | 26,502 | | | | 59% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 11.25 | | | | 6.53 | | | | 1.21 | 5 | | | 1.48 | 5 | | | (0.50 | ) | | | (0.77 | ) | | $ | 35,165 | | | | 4% | |
| $ | 10.56 | | | | (0.38 | ) | | | 1.21 | 6 8 | | | 1.45 | 6 8 | | | (0.36 | ) | | | (0.60 | ) | | $ | 30,215 | | | | 44% | |
| $ | 10.60 | | | | 13.73 | | | | 1.21 | 6 | | | 1.52 | 6 | | | (0.09 | ) | | | (0.39 | ) | | $ | 28,868 | | | | 55% | |
| $ | 9.32 | | | | 10.82 | | | | 1.29 | 6 | | | 1.59 | 6 | | | 0.29 | | | | (0.01 | ) | | $ | 26,763 | | | | 62% | |
| $ | 8.41 | | | | (18.67 | ) | | | 1.51 | 6 | | | 1.77 | 6 | | | (0.06 | ) | | | (0.32 | ) | | $ | 19,270 | | | | 46% | |
| $ | 10.37 | | | | 8.13 | | | | 1.51 | 5 | | | 1.71 | 5 | | | 0.05 | | | | (0.15 | ) | | $ | 32,306 | | | | 59% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 2.55 | | | | 3.63 | | | | 1.97 | 6 | | | 2.05 | 6 | | | (1.34 | ) | | | (1.43 | ) | | $ | 229,287 | | | | 5% | |
| $ | 2.78 | | | | (7.02 | ) | | | 1.96 | 6 7 | | | 1.98 | 6 7 | | | (0.51 | ) | | | (0.53 | ) | | $ | 285,540 | | | | 40% | |
| $ | 2.99 | | | | 11.99 | | | | 1.96 | 6 | | | 2.02 | 6 | | | (0.49 | ) | | | (0.56 | ) | | $ | 390,903 | | | | 58% | |
| $ | 2.67 | | | | 11.73 | | | | 1.96 | 6 | | | 2.00 | 6 | | | (0.75 | ) | | | (0.79 | ) | | $ | 674,632 | | | | 42% | |
| $ | 2.39 | | | | (12.65 | ) | | | 1.95 | 5 | | | 2.01 | 5 | | | (0.63 | ) | | | (0.69 | ) | | $ | 981,367 | | | | 59% | |
| $ | 2.74 | | | | 4.90 | | | | 1.95 | 5 | | | 2.02 | 5 | | | (0.28 | ) | | | (0.35 | ) | | $ | 1,457,882 | | | | 55% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 2.57 | | | | 4.01 | | | | 1.82 | 6 | | | 1.88 | 6 | | | (1.19 | ) | | | (1.25 | ) | | $ | 213,403 | | | | 5% | |
| $ | 2.79 | | | | (7.00 | ) | | | 1.82 | 6 7 | | | 1.84 | 6 7 | | | (0.33 | ) | | | (0.35 | ) | | $ | 240,892 | | | | 40% | |
| $ | 3.00 | | | | 12.36 | | | | 1.81 | 6 | | | 1.88 | 6 | | | (0.05 | ) | | | (0.12 | ) | | $ | 252,823 | | | | 58% | |
| $ | 2.67 | | | | 15.58 | | | | 1.80 | 6 | | | 1.81 | 6 | | | (0.03 | ) | | | (0.04 | ) | | $ | 160,729 | | | | 42% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 2.61 | | | | 3.98 | | | | 2.56 | 6 | | | 2.98 | 6 | | | (1.59 | ) | | | (2.01 | ) | | $ | 46,780 | | | | 44% | |
| $ | 2.51 | | | | (8.73 | ) | | | 2.22 | 6 7 | | | 2.36 | 6 7 | | | (0.39 | ) | | | (0.53 | ) | | $ | 57,406 | | | | 42% | |
| $ | 2.75 | | | | 4.56 | | | | 2.28 | 6 | | | 2.46 | 6 | | | (0.48 | ) | | | (0.67 | ) | | $ | 155,758 | | | | 59% | |
| $ | 2.63 | | | | (4.89 | ) | | | 2.25 | 5 | | | 2.39 | 5 | | | 0.35 | | | | 0.21 | | | $ | 437,850 | | | | 80% | |
| $ | 2.77 | | | | (14.88 | ) | | | 2.25 | 5 | | | 2.28 | 5 | | | 0.39 | | | | 0.36 | | | $ | 1,027,673 | | | | 34% | |
| $ | 3.32 | | | | 11.97 | | | | 2.24 | 5 | | | 2.24 | 5 | | | 0.79 | | | | 0.79 | | | $ | 1,324,694 | | | | 22% | |
85
Financial Highlights(continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | Income (Loss) from
Investment Operations | | | | | | Less Distributions | | |
| | | Net Asset
Value
Beginning
of Period | | Net
Investment
Income (Loss) | | Net Realized
and Unrealized
Gains (Losses)
on Investments | | Total from
Investment
Operations | | Redemption
Fees
(See Note 2) | | Dividends
from Net
Investment
Income | | Distributions
from Net
Realized
Gains | | Total
Distributions |
Frontier Emerging Small Countries Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 2.53 | | | | | (— | )4 | | | | 0.10 | | | | | 0.10 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/18 | | | $ | 2.76 | | | | | (0.04 | ) | | | | (0.19 | ) | | | | (0.23 | ) | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/17 | | | $ | 2.64 | | | | | (0.06 | ) | | | | 0.18 | | | | | 0.12 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Period ended 9/30/1614 16 | | | $ | 2.58 | | | | | 0.02 | | | | | 0.04 | | | | | 0.06 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Global Opportunities Fund — Investor Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 4.09 | | | | | (0.02 | ) | | | | (0.19 | ) | | | | (0.21 | ) | | | | — | 4 | | | | — | | | | | (0.54 | ) | | | | (0.54 | ) |
Year ended 9/30/18 | | | $ | 3.76 | | | | | (0.03 | ) | | | | 0.77 | | | | | 0.74 | | | | | — | 4 | | | | — | | | | | (0.41 | ) | | | | (0.41 | ) |
Year ended 9/30/17 | | | $ | 3.52 | | | | | (0.07 | ) | | | | 0.58 | | | | | 0.51 | | | | | — | 4 | | | | — | 4 | | | | (0.27 | ) | | | | (0.27 | ) |
Year ended 9/30/1616 | | | $ | 3.51 | | | | | (0.04 | ) | | | | 0.51 | | | | | 0.47 | | | | | — | 4 | | | | (0.01 | ) | | | | (0.45 | ) | | | | (0.46 | ) |
Year ended 9/30/15 | | | $ | 4.28 | | | | | (0.05 | ) | | | | (0.08 | ) | | | | (0.13 | ) | | | | — | 4 | | | | (0.01 | ) | | | | (0.63 | ) | | | | (0.64 | ) |
Year ended 9/30/14 | | | $ | 4.58 | | | | | (0.05 | ) | | | | 0.23 | | | | | 0.18 | | | | | — | 4 | | | | — | 4 | | | | (0.48 | ) | | | | (0.48 | ) |
Global Opportunities Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 4.10 | | | | | (0.02 | ) | | | | (0.19 | ) | | | | (0.21 | ) | | | | — | | | | | — | | | | | (0.54 | ) | | | | (0.54 | ) |
Year ended 9/30/18 | | | $ | 3.76 | | | | | (0.02 | ) | | | | 0.77 | | | | | 0.75 | | | | | — | | | | | — | | | | | (0.41 | ) | | | | (0.41 | ) |
Year ended 9/30/17 | | | $ | 3.52 | | | | | (0.02 | ) | | | | 0.54 | | | | | 0.52 | | | | | — | | | | | (0.01 | ) | | | | (0.27 | ) | | | | (0.28 | ) |
Period ended 9/30/1614 16 | | | $ | 3.09 | | | | | (— | )4 | | | | 0.43 | | | | | 0.43 | | | | | — | | | | | — | | | | | — | | | | | — | |
Global Value Fund — Investor Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 9.29 | | | | | 0.10 | | | | | (0.44 | ) | | | | (0.34 | ) | | | | — | 4 | | | | (0.08 | ) | | | | (1.13 | ) | | | | (1.21 | ) |
Year ended 9/30/18 | | | $ | 9.93 | | | | | 0.19 | | | | | 0.65 | 18 | | | | 0.84 | | | | | — | 4 | | | | (0.19 | ) | | | | (1.29 | ) | | | | (1.48 | ) |
Year ended 9/30/17 | | | $ | 9.02 | | | | | 0.19 | | | | | 1.23 | | | | | 1.42 | | | | | — | 4 | | | | (0.19 | ) | | | | (0.32 | ) | | | | (0.51 | ) |
Year ended 9/30/1616 | | | $ | 8.84 | | | | | 0.16 | | | | | 1.01 | | | | | 1.17 | | | | | — | 4 | | | | (0.16 | ) | | | | (0.83 | ) | | | | (0.99 | ) |
Year ended 9/30/15 | | | $ | 12.69 | | | | | 0.15 | | | | | (0.69 | ) | | | | (0.54 | ) | | | | — | 4 | | | | (0.16 | ) | | | | (3.15 | ) | | | | (3.31 | ) |
Year ended 9/30/14 | | | $ | 16.57 | | | | | 0.21 | | | | | 1.49 | | | | | 1.70 | | | | | — | 4 | | | | (0.22 | ) | | | | (5.36 | ) | | | | (5.58 | ) |
Global Value Fund — Institutional Class | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six Months ended 3/31/19 (unaudited) | | | $ | 9.28 | | | | | 0.11 | | | | | (0.46 | ) | | | | (0.35 | ) | | | | — | 4 | | | | (0.09 | ) | | | | (1.13 | ) | | | | (1.22 | ) |
Year ended 9/30/18 | | | $ | 9.92 | | | | | 0.20 | | | | | 0.66 | 18 | | | | 0.86 | | | | | — | 4 | | | | (0.20 | ) | | | | (1.30 | ) | | | | (1.50 | ) |
Year ended 9/30/17 | | | $ | 9.01 | | | | | 0.18 | | | | | 1.25 | | | | | 1.43 | | | | | — | 4 | | | | (0.20 | ) | | | | (0.32 | ) | | | | (0.52 | ) |
Year ended 9/30/1616 | | | $ | 8.84 | | | | | 0.29 | | | | | 0.88 | | | | | 1.17 | | | | | — | 4 | | | | (0.17 | ) | | | | (0.83 | ) | | | | (1.00 | ) |
Year ended 9/30/15 | | | $ | 12.69 | | | | | (0.04 | ) | | | | (0.49 | ) | | | | (0.53 | ) | | | | — | 4 | | | | (0.17 | ) | | | | (3.15 | ) | | | | (3.32 | ) |
Year ended 9/30/14 | | | $ | 16.57 | | | | | 0.20 | | | | | 1.52 | | | | | 1.72 | | | | | — | 4 | | | | (0.24 | ) | | | | (5.36 | ) | | | | (5.60 | ) |
International Growth Fund — Investor Class | |
Six Months ended 3/31/19 (unaudited) | | | $ | 36.95 | | | | | (0.06 | ) | | | | (4.57 | ) | | | | (4.63 | ) | | | | — | 4 | | | | — | | | | | (4.38 | ) | | | | (4.38 | ) |
Year ended 9/30/18 | | | $ | 33.84 | | | | | (— | )4 | | | | 4.04 | | | | | 4.04 | | | | | — | 4 | | | | — | | | | | (0.93 | ) | | | | (0.93 | ) |
Year ended 9/30/17 | | | $ | 31.43 | | | | | (0.13 | ) | | | | 3.61 | | | | | 3.48 | | | | | — | 4 | | | | — | | | | | (1.07 | ) | | | | (1.07 | ) |
Year ended 9/30/1616 | | | $ | 27.88 | | | | | (0.22 | ) | | | | 3.77 | | | | | 3.55 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/15 | | | $ | 26.78 | | | | | (0.09 | ) | | | | 1.39 | | | | | 1.30 | | | | | — | 4 | | | | (0.01 | ) | | | | (0.19 | ) | | | | (0.20 | ) |
Year ended 9/30/14 | | | $ | 28.76 | | | | | (0.02 | ) | | | | (1.24 | ) | | | | (1.26 | ) | | | | — | 4 | | | | — | | | | | (0.72 | ) | | | | (0.72 | ) |
International Growth Fund — Institutional Class | |
Six Months ended 3/31/19 (unaudited) | | | $ | 37.03 | | | | | (0.05 | ) | | | | (4.57 | ) | | | | (4.62 | ) | | | | — | 4 | | | | — | | | | | (4.38 | ) | | | | (4.38 | ) |
Year ended 9/30/18 | | | $ | 33.88 | | | | | 0.06 | | | | | 4.02 | | | | | 4.08 | | | | | — | 4 | | | | — | | | | | (0.93 | ) | | | | (0.93 | ) |
Year ended 9/30/17 | | | $ | 31.46 | | | | | (0.05 | ) | | | | 3.56 | | | | | 3.51 | | | | | — | 4 | | | | (0.02 | ) | | | | (1.07 | ) | | | | (1.09 | ) |
Period ended 9/30/1614 16 | | | $ | 28.46 | | | | | 0.01 | | | | | 2.99 | | | | | 3.00 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
International Opportunities Fund — Investor Class | |
Six Months ended 3/31/19 (unaudited) | | | $ | 3.58 | | | | | (0.07 | ) | | | | (0.15 | ) | | | | (0.22 | ) | | | | — | 4 | | | | — | | | | | (0.08 | ) | | | | (0.08 | ) |
Year ended 9/30/18 | | | $ | 3.47 | | | | | (0.05 | ) | | | | 0.40 | | | | | 0.35 | | | | | — | 4 | | | | — | | | | | (0.24 | ) | | | | (0.24 | ) |
Year ended 9/30/17 | | | $ | 3.21 | | | | | (0.04 | ) | | | | 0.30 | | | | | 0.26 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/1616 | | | $ | 2.74 | | | | | (0.01 | ) | | | | 0.61 | | | | | 0.60 | | | | | — | 4 | | | | — | | | | | (0.13 | ) | | | | (0.13 | ) |
Year ended 9/30/15 | | | $ | 3.09 | | | | | (0.01 | ) | | | | (0.04 | ) | | | | (0.05 | ) | | | | — | 4 | | | | — | | | | | (0.30 | ) | | | | (0.30 | ) |
Year ended 9/30/14 | | | $ | 2.94 | | | | | (0.01 | ) | | | | 0.33 | | | | | 0.32 | | | | | — | 4 | | | | — | | | | | (0.17 | ) | | | | (0.17 | ) |
International Opportunities Fund — Institutional Class | |
Six Months ended 3/31/19 (unaudited) | | | $ | 3.62 | | | | | (0.02 | ) | | | | (0.20 | ) | | | | (0.22 | ) | | | | — | 4 | | | | — | | | | | (0.08 | ) | | | | (0.08 | ) |
Year ended 9/30/18 | | | $ | 3.50 | | | | | (0.03 | ) | | | | 0.39 | | | | | 0.36 | | | | | — | 4 | | | | — | | | | | (0.24 | ) | | | | (0.24 | ) |
Year ended 9/30/17 | | | $ | 3.23 | | | | | (0.01 | ) | | | | 0.28 | | | | | 0.27 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Period ended 9/30/1614 16 | | | $ | 2.71 | | | | | 0.01 | | | | | 0.51 | | | | | 0.52 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
See Notes to Financial Highlights and Notes to Financial Statements.
86
| | |
| | (for a share outstanding throughout each period) |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | |
Ratios to Average Net Assets | | | Supplemental Data | |
Net Asset
Value
End of
Period | | | Total Return (%)1 | | | Expenses Net of Waivers and
Reimbursements (%)2 | | | Expenses Before Waivers and
Reimbursements (%)2 | | | Net Investment
Income (Loss) Net
of Waivers and
Reimbursements (%)2 | | | Net Investment
Income (Loss)
Before Waivers and
Reimbursements (%)2 | | | Net Assets
End of
Period
(000s) | | | Portfolio
Turnover
Rate1 3 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 2.63 | | | | 3.95 | | | | 2.03 | 6 | | | 2.41 | 6 | | | (0.07 | ) | | | (0.45 | ) | | $ | 16,869 | | | | 44% | |
| $ | 2.53 | | | | (8.33 | ) | | | 2.02 | 6 8 | | | 2.11 | 6 8 | | | (0.30 | ) | | | (0.39 | ) | | $ | 20,586 | | | | 42% | |
| $ | 2.76 | | | | 4.55 | | | | 2.08 | 6 | | | 2.17 | 6 | | | (0.34 | ) | | | (0.44 | ) | | $ | 42,006 | | | | 59% | |
| $ | 2.64 | | | | 2.33 | | | | 2.06 | 6 | | | 2.06 | 6 | | | 1.40 | | | | 1.40 | | | $ | 139,699 | | | | 80% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 3.34 | | | | (2.68 | ) | | | 1.57 | 5 | | | 1.57 | 5 | | | (1.13 | ) | | | (1.13 | ) | | $ | 99,315 | | | | 11% | |
| $ | 4.09 | | | | 20.75 | | | | 1.55 | 6 8 | | | 1.55 | 6 8 | | | (0.78 | ) | | | (0.78 | ) | | $ | 110,874 | | | | 40% | |
| $ | 3.76 | | | | 16.61 | | | | 1.59 | 6 | | | 1.59 | 6 | | | (1.09 | ) | | | (1.09 | ) | | $ | 95,847 | | | | 27% | |
| $ | 3.52 | | | | 13.73 | | | | 1.62 | 6 | | | 1.62 | 6 | | | (0.98 | ) | | | (0.98 | ) | | $ | 150,945 | | | | 44% | |
| $ | 3.51 | | | | (3.88 | ) | | | 1.81 | 5 | | | 1.81 | 5 | | | (1.10 | ) | | | (1.10 | ) | | $ | 155,968 | | | | 54% | |
| $ | 4.28 | | | | 3.94 | | | | 1.78 | 5 | | | 1.78 | 5 | | | (0.83 | ) | | | (0.83 | ) | | $ | 192,664 | | | | 42% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 3.35 | | | | (2.68 | ) | | | 1.36 | 5 | | | 1.59 | 5 | | | (0.91 | ) | | | (1.14 | ) | | $ | 17,396 | | | | 11% | |
| $ | 4.10 | | | | 21.04 | | | | 1.36 | 6 8 | | | 1.66 | 6 8 | | | (0.57 | ) | | | (0.86 | ) | | $ | 15,879 | | | | 40% | |
| $ | 3.76 | | | | 16.92 | | | | 1.36 | 6 | | | 1.93 | 6 | | | (0.85 | ) | | | (1.41 | ) | | $ | 7,149 | | | | 27% | |
| $ | 3.52 | | | | 13.92 | | | | 1.35 | 5 | | | 2.32 | 5 | | | (0.57 | ) | | | (1.54 | ) | | $ | 5,348 | | | | 44% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 7.74 | | | | (1.80 | )5 | | | 1.10 | 5 | | | 1.21 | 5 | | | 2.40 | | | | 2.29 | | | $ | 162,960 | | | | 20% | |
| $ | 9.29 | | | | 9.56 | 18 | | | 1.11 | 5 8 | | | 1.19 | 5 8 | | | 2.17 | | | | 2.08 | | | $ | 192,811 | | | | 72% | |
| $ | 9.93 | | | | 16.11 | | | | 1.10 | 5 | | | 1.19 | 5 | | | 1.93 | | | | 1.84 | | | $ | 175,730 | | | | 44% | |
| $ | 9.02 | | | | 13.92 | | | | 1.10 | 5 | | | 1.17 | 5 | | | 1.70 | | | | 1.63 | | | $ | 189,691 | | | | 26% | |
| $ | 8.84 | | | | (6.61 | ) | | | 1.10 | 5 | | | 1.12 | 5 | | | 1.34 | | | | 1.32 | | | $ | 244,056 | | | | 39% | |
| $ | 12.69 | | | | 11.78 | | | | 1.11 | 5 7 | | | 1.12 | 5 7 | | | 1.38 | | | | 1.37 | | | $ | 409,169 | | | | 53% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 7.71 | | | | (1.72 | ) | | | 0.95 | 5 | | | 1.26 | 5 | | | 2.57 | | | | 2.26 | | | $ | 8,431 | | | | 20% | |
| $ | 9.28 | | | | 9.61 | 18 | | | 0.95 | 5 8 | | | 1.58 | 5 8 | | | 2.39 | | | | 1.76 | | | $ | 9,615 | | | | 72% | |
| $ | 9.92 | | | | 16.31 | | | | 0.95 | 5 | | | 2.31 | 5 | | | 2.05 | | | | 0.70 | | | $ | 4,594 | | | | 44% | |
| $ | 9.01 | | | | 13.97 | | | | 0.96 | 5 | | | 1.72 | 5 | | | 1.76 | | | | 1.00 | | | $ | 3,589 | | | | 26% | |
| $ | 8.84 | | | | (6.50 | ) | | | 0.98 | 5 | | | 1.44 | 5 | | | 1.40 | | | | 0.94 | | | $ | 1,525 | | | | 39% | |
| $ | 12.69 | | | | 11.95 | | | | 0.98 | 5 | | | 1.25 | 5 | | | 1.52 | | | | 1.25 | | | $ | 8,068 | | | | 53% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 27.94 | | | | (10.69 | ) | | | 1.47 | 5 | | | 1.47 | 5 | | | (0.48 | ) | | | (0.48 | ) | | $ | 614,384 | | | | 21% | |
| $ | 36.95 | | | | 12.13 | | | | 1.45 | 5 8 | | | 1.45 | 5 8 | | | 0.01 | | | | 0.01 | | | $ | 748,847 | | | | 44% | |
| $ | 33.84 | | | | 12.04 | | | | 1.46 | 5 | | | 1.46 | 5 | | | (0.28 | ) | | | (0.28 | ) | | $ | 804,613 | | | | 31% | |
| $ | 31.43 | | | | 12.73 | | | | 1.48 | 5 | | | 1.48 | 5 | | | (0.41 | ) | | | (0.41 | ) | | $ | 945,168 | | | | 50% | |
| $ | 27.88 | | | | 4.83 | | | | 1.50 | 5 | | | 1.50 | 5 | | | (0.32 | ) | | | (0.32 | ) | | $ | 1,316,095 | | | | 46% | |
| $ | 26.78 | | | | (4.53 | ) | | | 1.46 | 5 | | | 1.46 | 5 | | | (0.06 | ) | | | (0.06 | ) | | $ | 1,421,086 | | | | 42% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 28.03 | | | | (10.63 | ) | | | 1.36 | 5 | | | 1.36 | 5 | | | (0.36 | ) | | | (0.37 | ) | | $ | 662,718 | | | | 21% | |
| $ | 37.03 | | | | 12.24 | | | | 1.35 | 5 8 | | | 1.36 | 5 8 | | | 0.16 | | | | 0.16 | | | $ | 816,942 | | | | 44% | |
| $ | 33.88 | | | | 12.16 | | | | 1.35 | 5 | | | 1.37 | 5 | | | (0.14 | ) | | | (0.16 | ) | | $ | 656,860 | | | | 31% | |
| $ | 31.46 | | | | 10.54 | | | | 1.35 | 5 | | | 1.36 | 5 | | | 0.07 | | | | 0.06 | | | $ | 509,016 | | | | 50% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 3.28 | | | | (5.85 | ) | | | 2.21 | 6 | | | 2.21 | 6 | | | (1.46 | ) | | | (1.46 | ) | | $ | 133,333 | | | | 18% | |
| $ | 3.58 | | | | 10.45 | | | | 2.10 | 5 7 | | | 2.10 | 5 7 | | | (1.07 | ) | | | (1.07 | ) | | $ | 240,489 | | | | 36% | |
| $ | 3.47 | | | | 8.10 | | | | 2.24 | 6 | | | 2.24 | 6 | | | (0.88 | ) | | | (0.88 | ) | | $ | 265,879 | | | | 59% | |
| $ | 3.21 | | | | 22.73 | | | | 2.25 | 5 | | | 2.29 | 5 | | | (0.35 | ) | | | (0.39 | ) | | $ | 512,252 | | | | 41% | |
| $ | 2.74 | | | | (1.44 | ) | | | 2.25 | 5 | | | 2.43 | 5 | | | (0.36 | ) | | | (0.54 | ) | | $ | 453,495 | | | | 25% | |
| $ | 3.09 | | | | 11.53 | | | | 2.25 | 5 | | | 2.41 | 5 | | | (0.40 | ) | | | (0.56 | ) | | $ | 339,659 | | | | 38% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 3.32 | | | | (5.79 | ) | | | 1.97 | 6 | | | 2.00 | 6 | | | (1.18 | ) | | | (1.22 | ) | | $ | 280,231 | | | | 18% | |
| $ | 3.62 | | | | 10.66 | | | | 1.96 | 5 7 | | | 1.97 | 5 7 | | | (0.86 | ) | | | (0.87 | ) | | $ | 292,345 | | | | 36% | |
| $ | 3.50 | | | | 8.36 | | | | 1.96 | 6 | | | 2.04 | 6 | | | (0.39 | ) | | | (0.47 | ) | | $ | 234,795 | | | | 59% | |
| $ | 3.23 | | | | 19.19 | | | | 1.95 | 5 | | | 2.04 | 5 | | | 0.64 | | | | 0.55 | | | $ | 168,136 | | | | 41% | |
87
Financial Highlights(continued)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | Income (Loss) from
Investment Operations | | | | | | Less Distributions | | |
| | | Net Asset
Value
Beginning
of Period | | Net
Investment
Income (Loss) | | Net Realized
and Unrealized
Gains (Losses)
on Investments | | Total from
Investment
Operations | | Redemption
Fees
(See Note 2) | | Dividends
from Net
Investment
Income | | Distributions
from Net
Realized
Gains | | Total
Distributions |
Micro Cap Fund | |
Six Months ended 3/31/19 (unaudited) | | | $ | 9.86 | | | | | (0.02 | ) | | | | (0.94 | ) | | | | (0.96 | ) | | | | — | 4 | | | | — | | | | | (1.78 | ) | | | | (1.78 | ) |
Year ended 9/30/18 | | | $ | 8.23 | | | | | (0.08 | ) | | | | 2.88 | | | | | 2.80 | | | | | — | 4 | | | | — | | | | | (1.17 | ) | | | | (1.17 | ) |
Year ended 9/30/17 | | | $ | 7.19 | | | | | (0.11 | ) | | | | 1.75 | | | | | 1.64 | | | | | — | 4 | | | | (0.01 | ) | | | | (0.59 | ) | | | | (0.60 | ) |
Year ended 9/30/1616 | | | $ | 7.21 | | | | | (0.08 | ) | | | | 1.15 | | | | | 1.07 | | | | | — | 4 | | | | — | | | | | (1.09 | ) | | | | (1.09 | ) |
Year ended 9/30/15 | | | $ | 7.36 | | | | | (0.08 | )10 | | | | 0.28 | | | | | 0.20 | | | | | — | 4 | | | | — | 4 | | | | (0.35 | ) | | | | (0.35 | ) |
Year ended 9/30/14 | | | $ | 7.42 | | | | | (0.14 | ) | | | | 0.08 | | | | | (0.06 | ) | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Micro Cap Value Fund | |
Six Months ended 3/31/19 (unaudited) | | | $ | 3.83 | | | | | (0.01 | ) | | | | (0.32 | ) | | | | (0.33 | ) | | | | — | 4 | | | | (0.02 | ) | | | | (0.36 | ) | | | | (0.38 | ) |
Year ended 9/30/18 | | | $ | 3.48 | | | | | (0.03 | ) | | | | 0.65 | | | | | 0.62 | | | | | — | 4 | | | | — | | | | | (0.27 | ) | | | | (0.27 | ) |
Year ended 9/30/17 | | | $ | 2.87 | | | | | (0.02 | ) | | | | 0.68 | | | | | 0.66 | | | | | — | 4 | | | | — | 4 | | | | (0.05 | ) | | | | (0.05 | ) |
Year ended 9/30/1616 | | | $ | 2.87 | | | | | (0.02 | ) | | | | 0.34 | | | | | 0.32 | | | | | — | 4 | | | | — | | | | | (0.32 | ) | | | | (0.32 | ) |
Year ended 9/30/15 | | | $ | 3.02 | | | | | (0.02 | )11 | | | | 0.31 | | | | | 0.29 | | | | | — | 4 | | | | — | | | | | (0.44 | ) | | | | (0.44 | ) |
Year ended 9/30/14 | | | $ | 3.45 | | | | | (0.04 | ) | | | | 0.18 | | | | | 0.14 | | | | | — | 4 | | | | — | | | | | (0.57 | ) | | | | (0.57 | ) |
Small Cap Growth Fund — Investor Class | |
Six Months ended 3/31/19 (unaudited) | | | $ | 55.30 | | | | | (0.09 | ) | | | | (4.06 | ) | | | | (4.15 | ) | | | | — | 4 | | | | — | | | | | (12.46 | ) | | | | (12.46 | ) |
Year ended 9/30/18 | | | $ | 45.72 | | | | | (0.54 | ) | | | | 15.19 | | | | | 14.65 | | | | | — | 4 | | | | — | | | | | (5.07 | ) | | | | (5.07 | ) |
Year ended 9/30/17 | | | $ | 43.52 | | | | | (0.53 | ) | | | | 6.24 | | | | | 5.71 | | | | | — | 4 | | | | — | | | | | (3.51 | ) | | | | (3.51 | ) |
Year ended 9/30/1616 | | | $ | 45.97 | | | | | (0.47 | ) | | | | 5.65 | | | | | 5.18 | | | | | — | 4 | | | | — | | | | | (7.63 | ) | | | | (7.63 | ) |
Year ended 9/30/15 | | | $ | 50.25 | | | | | (0.40 | ) | | | | 0.93 | | | | | 0.53 | | | | | — | 4 | | | | — | | | | | (4.81 | ) | | | | (4.81 | ) |
Year ended 9/30/14 | | | $ | 51.31 | | | | | (0.41 | ) | | | | 1.03 | | | | | 0.62 | | | | | — | 4 | | | | — | | | | | (1.68 | ) | | | | (1.68 | ) |
Small Cap Growth Fund — Institutional Class | |
Six Months ended 3/31/19 (unaudited) | | | $ | 55.61 | | | | | (0.08 | ) | | | | (4.04 | ) | | | | (4.12 | ) | | | | — | 4 | | | | — | | | | | (12.46 | ) | | | | (12.46 | ) |
Year ended 9/30/18 | | | $ | 45.89 | | | | | (0.31 | ) | | | | 15.10 | | | | | 14.79 | | | | | — | 4 | | | | — | | | | | (5.07 | ) | | | | (5.07 | ) |
Year ended 9/30/17 | | | $ | 43.58 | | | | | (0.17 | ) | | | | 5.99 | | | | | 5.82 | | | | | — | 4 | | | | — | | | | | (3.51 | ) | | | | (3.51 | ) |
Period ended 9/30/1614 16 | | | $ | 37.58 | | | | | (0.07 | ) | | | | 6.07 | | | | | 6.00 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Small Cap Value Fund — Investor Class | |
Six Months ended 3/31/19 (unaudited) | | | $ | 8.53 | | | | | 0.02 | | | | | (0.59 | ) | | | | (0.57 | ) | | | | — | 4 | | | | — | | | | | (0.59 | ) | | | | (0.59 | ) |
Year ended 9/30/18 | | | $ | 7.94 | | | | | 0.02 | | | | | 1.10 | | | | | 1.12 | | | | | — | 4 | | | | (0.01 | ) | | | | (0.52 | ) | | | | (0.53 | ) |
Year ended 9/30/17 | | | $ | 6.61 | | | | | — | 4 | | | | 1.33 | | | | | 1.33 | | | | | — | 4 | | | | — | 4 | | | | — | | | | | — | |
Year ended 9/30/1616 | | | $ | 5.86 | | | | | 0.01 | | | | | 0.77 | | | | | 0.78 | | | | | — | 4 | | | | (0.03 | ) | | | | — | | | | | (0.03 | ) |
Year ended 9/30/15 | | | $ | 5.69 | | | | | 0.05 | 12 | | | | 0.12 | | | | | 0.17 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/14 | | | $ | 5.12 | | | | | (0.02 | ) | | | | 0.59 | | | | | 0.57 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Small Cap Value Fund — Institutional Class | |
Six Months ended 3/31/19 (unaudited) | | | $ | 8.58 | | | | | 0.02 | | | | | (0.59 | ) | | | | (0.57 | ) | | | | — | 4 | | | | — | | | | | (0.59 | ) | | | | (0.59 | ) |
Year ended 9/30/18 | | | $ | 7.98 | | | | | 0.04 | | | | | 1.10 | | | | | 1.14 | | | | | — | 4 | | | | (0.02 | ) | | | | (0.52 | ) | | | | (0.54 | ) |
Year ended 9/30/17 | | | $ | 6.65 | | | | | 0.01 | | | | | 1.34 | | | | | 1.35 | | | | | — | 4 | | | | (0.02 | ) | | | | — | | | | | (0.02 | ) |
Year ended 9/30/1616 | | | $ | 5.88 | | | | | 0.02 | | | | | 0.78 | | | | | 0.80 | | | | | — | 4 | | | | (0.03 | ) | | | | — | | | | | (0.03 | ) |
Year ended 9/30/15 | | | $ | 5.72 | | | | | 0.05 | 12 | | | | 0.11 | | | | | 0.16 | | | | | — | 4 | | | | — | | | | | — | | | | | — | |
Year ended 9/30/14 | | | $ | 5.14 | | | | | (0.03 | ) | | | | 0.61 | | | | | 0.58 | | | | | — | | | | | — | | | | | — | | | | | — | |
Ultra Growth Fund | |
Six Months ended 3/31/19 (unaudited) | | | $ | 27.68 | | | | | (0.07 | ) | | | | (1.03 | ) | | | | (1.10 | ) | | | | 0.01 | | | | | — | | | | | (1.61 | ) | | | | (1.61 | ) |
Year ended 9/30/18 | | | $ | 21.81 | | | | | — | 4 | | | | 8.31 | | | | | 8.31 | | | | | — | 4 | | | | (0.10 | ) | | | | (2.34 | ) | | | | (2.44 | ) |
Year ended 9/30/17 | | | $ | 19.89 | | | | | (0.20 | ) | | | | 4.12 | | | | | 3.92 | | | | | — | 4 | | | | (0.11 | ) | | | | (1.89 | ) | | | | (2.00 | ) |
Year ended 9/30/1616 | | | $ | 18.06 | | | | | (0.18 | ) | | | | 3.66 | | | | | 3.48 | | | | | — | 4 | | | | — | | | | | (1.65 | ) | | | | (1.65 | ) |
Year ended 9/30/15 | | | $ | 23.67 | | | | | (0.26 | ) | | | | 1.54 | | | | | 1.28 | | | | | — | 4 | | | | (0.01 | ) | | | | (6.88 | ) | | | | (6.89 | ) |
Year ended 9/30/14 | | | $ | 24.57 | | | | | (0.06 | ) | | | | 0.80 | | | | | 0.74 | | | | | — | 4 | | | | — | | | | | (1.64 | ) | | | | (1.64 | ) |
U.S. Treasury Fund | |
Six Months ended 3/31/19 (unaudited) | | | $ | 15.26 | | | | | 0.17 | | | | | 1.30 | | | | | 1.47 | | | | | 0.01 | | | | | (0.17 | ) | | | | — | | | | | (0.17 | ) |
Year ended 9/30/18 | | | $ | 16.32 | | | | | 0.35 | | | | | (1.07 | ) | | | | (0.72 | ) | | | | — | 4 | | | | (0.34 | ) | | | | — | | | | | (0.34 | ) |
Year ended 9/30/17 | | | $ | 19.86 | | | | | 0.35 | | | | | (2.23 | ) | | | | (1.88 | ) | | | | 0.01 | | | | | (0.35 | ) | | | | (1.32 | ) | | | | (1.67 | ) |
Year ended 9/30/1616 | | | $ | 18.42 | | | | | 0.37 | | | | | 2.29 | | | | | 2.66 | | | | | 0.01 | | | | | (0.36 | ) | | | | (0.87 | ) | | | | (1.23 | ) |
Year ended 9/30/15 | | | $ | 17.08 | | | | | 0.38 | | | | | 1.33 | | | | | 1.71 | | | | | 0.01 | | | | | (0.38 | ) | | | | — | | | | | (0.38 | ) |
Year ended 9/30/14 | | | $ | 15.33 | | | | | 0.45 | | | | | 1.75 | | | | | 2.20 | | | | | — | 4 | | | | (0.45 | ) | | | | — | | | | | (0.45 | ) |
See Notes to Financial Highlights and Notes to Financial Statements.
88
| | |
| | (for a share outstanding throughout each period) |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | |
Ratios to Average Net Assets | | | Supplemental Data | |
Net Asset
Value
End of
Period | | | Total Return (%)1 | | | Expenses Net of Waivers and
Reimbursements (%)2 | | | Expenses Before Waivers and
Reimbursements (%)2 | | | Net Investment
Income (Loss) Net
of Waivers and
Reimbursements (%)2 | | | Net Investment
Income (Loss)
Before Waivers and
Reimbursements (%)2 | | | Net Assets
End of
Period
(000s) | | | Portfolio
Turnover
Rate1 3 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 7.12 | | | | (5.53 | ) | | | 1.67 | 5 | | | 1.67 | 5 | | | (1.19 | ) | | | (1.19 | ) | | $ | 447,412 | | | | 35% | |
| $ | 9.86 | | | | 38.04 | | | | 1.65 | 5 8 | | | 1.65 | 5 8 | | | (1.27 | ) | | | (1.27 | ) | | $ | 496,128 | | | | 54% | |
| $ | 8.23 | | | | 25.10 | | | | 1.75 | 5 | | | 1.75 | 5 | | | (1.43 | ) | | | (1.43 | ) | | $ | 311,583 | | | | 31% | |
| $ | 7.19 | | | | 16.04 | | | | 1.92 | 5 | | | 1.92 | 5 | | | (1.14 | ) | | | (1.14 | ) | | $ | 277,691 | | | | 32% | |
| $ | 7.21 | | | | 2.45 | | | | 1.90 | 5 | | | 1.90 | 5 | | | (0.85 | )10 | | | (0.85 | )10 | | $ | 273,311 | | | | 31% | |
| $ | 7.36 | | | | (0.81 | ) | | | 1.97 | | | | 1.97 | | | | (1.67 | ) | | | (1.67 | ) | | $ | 293,815 | | | | 26% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 3.13 | | | | (6.88 | ) | | | 1.75 | 5 | | | 1.75 | 5 | | | (0.84 | ) | | | (0.84 | ) | | $ | 250,892 | | | | 35% | |
| $ | 3.83 | | | | 18.84 | | | | 1.74 | 5 8 | | | 1.74 | 5 8 | | | (0.89 | ) | | | (0.89 | ) | | $ | 283,623 | | | | 69% | |
| $ | 3.48 | | | | 23.29 | | | | 1.85 | 5 | | | 1.85 | 5 | | | (0.81 | ) | | | (0.81 | ) | | $ | 216,087 | | | | 57% | |
| $ | 2.87 | | | | 12.04 | | | | 1.95 | 5 | | | 2.04 | 5 | | | (0.59 | ) | | | (0.68 | ) | | $ | 179,116 | | | | 73% | |
| $ | 2.87 | | | | 9.99 | | | | 1.96 | 6 | | | 2.02 | 6 | | | (0.55 | )11 | | | (0.61 | )11 | | $ | 154,169 | | | | 53% | |
| $ | 3.02 | | | | 3.26 | | | | 2.03 | 5 | | | 2.09 | 5 | | | (1.31 | ) | | | (1.37 | ) | | $ | 158,800 | | | | 71% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 38.69 | | | | (2.22 | ) | | | 1.19 | 5 | | | 1.19 | 5 | | | (0.85 | ) | | | (0.85 | ) | | $ | 1,010,137 | | | | 12% | |
| $ | 55.30 | | | | 35.08 | | | | 1.20 | 5 8 | | | 1.20 | 5 8 | | | (0.84 | ) | | | (0.84 | ) | | $ | 1,170,809 | | | | 36% | |
| $ | 45.72 | | | | 14.29 | | | | 1.27 | 5 | | | 1.27 | 5 | | | (0.88 | ) | | | (0.88 | ) | | $ | 1,182,573 | | | | 19% | |
| $ | 43.52 | | | | 11.87 | | | | 1.29 | 5 | | | 1.29 | 5 | | | (0.79 | ) | | | (0.79 | ) | | $ | 1,544,796 | | | | 20% | |
| $ | 45.97 | | | | 0.39 | | | | 1.22 | 5 | | | 1.22 | 5 | | | (0.75 | ) | | | (0.75 | ) | | $ | 2,000,588 | | | | 31% | |
| $ | 50.25 | | | | 1.09 | | | | 1.21 | 5 | | | 1.21 | 5 | | | (0.75 | ) | | | (0.75 | ) | | $ | 2,219,638 | | | | 23% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 39.03 | | | | (2.14 | ) | | | 1.06 | 5 | | | 1.10 | 5 | | | (0.72 | ) | | | (0.76 | ) | | $ | 670,695 | | | | 12% | |
| $ | 55.61 | | | | 35.27 | | | | 1.06 | 5 7 | | | 1.10 | 5 7 | | | (0.70 | ) | | | (0.74 | ) | | $ | 714,184 | | | | 36% | |
| $ | 45.89 | | | | 14.54 | | | | 1.05 | 5 | | | 1.11 | 5 | | | (0.66 | ) | | | (0.72 | ) | | $ | 508,373 | | | | 19% | |
| $ | 43.58 | | | | 15.97 | | | | 1.05 | 5 | | | 1.11 | 5 | | | (0.63 | ) | | | (0.69 | ) | | $ | 337,605 | | | | 20% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 7.37 | | | | (5.76 | ) | | | 1.20 | 5 | | | 1.20 | 5 | | | 0.67 | | | | 0.67 | | | $ | 370,846 | | | | 18% | |
| $ | 8.53 | | | | 14.54 | | | | 1.20 | 5 8 | | | 1.20 | 5 8 | | | 0.29 | | | | 0.29 | | | $ | 347,298 | | | | 46% | |
| $ | 7.94 | | | | 20.20 | | | | 1.21 | 5 | | | 1.21 | 5 | | | 0.04 | | | | 0.04 | | | $ | 320,978 | | | | 37% | |
| $ | 6.61 | | | | 13.37 | | | | 1.24 | 5 | | | 1.24 | 5 | | | 0.23 | | | | 0.23 | | | $ | 269,710 | | | | 57% | |
| $ | 5.86 | | | | 2.99 | | | | 1.21 | 5 | | | 1.21 | 5 | | | 0.82 | 12 | | | 0.82 | 12 | | $ | 257,655 | | | | 57% | |
| $ | 5.69 | | | | 11.13 | | | | 1.20 | 5 | | | 1.20 | 5 | | | (0.52 | ) | | | (0.52 | ) | | $ | 265,521 | | | | 50% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 7.42 | | | | (5.72 | ) | | | 1.05 | 5 | | | 1.11 | 5 | | | 0.82 | | | | 0.77 | | | $ | 131,185 | | | | 18% | |
| $ | 8.58 | | | | 14.78 | | | | 1.06 | 5 8 | | | 1.13 | 5 8 | | | 0.43 | | | | 0.35 | | | $ | 91,857 | | | | 46% | |
| $ | 7.98 | | | | 20.28 | | | | 1.05 | 5 | | | 1.16 | 5 | | | 0.21 | | | | 0.11 | | | $ | 49,671 | | | | 37% | |
| $ | 6.65 | | | | 13.54 | | | | 1.08 | 5 | | | 1.20 | 5 | | | 0.40 | | | | 0.28 | | | $ | 23,839 | | | | 57% | |
| $ | 5.88 | | | | 2.97 | | | | 1.15 | 5 | | | 1.20 | 5 | | | 0.92 | 12 | | | 0.87 | 12 | | $ | 18,941 | | | | 57% | |
| $ | 5.72 | | | | 11.28 | | | | 1.15 | 5 | | | 1.44 | 5 | | | (0.49 | ) | | | (0.78 | ) | | $ | 10,436 | | | | 50% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 24.98 | | | | (2.60 | ) | | | 1.20 | 5 | | | 1.20 | 5 | | | (0.81 | ) | | | (0.81 | ) | | $ | 496,968 | | | | 9% | |
| $ | 27.68 | | | | 41.97 | | | | 1.24 | 5 8 | | | 1.24 | 5 8 | | | (1.00 | ) | | | (1.00 | ) | | $ | 297,562 | | | | 44% | |
| $ | 21.81 | | | | 22.13 | | | | 1.30 | 5 | | | 1.30 | 5 | | | (1.06 | ) | | | (1.06 | ) | | $ | 111,366 | | | | 34% | |
| $ | 19.89 | | | | 20.08 | | | | 1.33 | 5 | | | 1.33 | 5 | | | (1.03 | ) | | | (1.03 | ) | | $ | 101,402 | | | | 28% | |
| $ | 18.06 | | | | 4.02 | | | | 1.31 | 5 | | | 1.31 | 5 | | | (1.06 | ) | | | (1.06 | ) | | $ | 96,015 | | | | 38% | |
| $ | 23.67 | | | | 2.66 | | | | 1.26 | 5 | | | 1.26 | 5 | | | (1.00 | ) | | | (1.00 | ) | | $ | 102,834 | | | | 38% | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| $ | 16.57 | | | | 9.75 | | | | 0.71 | 5 | | | 0.71 | 5 | | | 2.22 | | | | 2.22 | | | $ | 328,040 | | | | 14% | |
| $ | 15.26 | | | | (4.47 | ) | | | 0.70 | 5 8 | | | 0.70 | 5 8 | | | 2.13 | | | | 2.13 | | | $ | 303,105 | | | | 6% | |
| $ | 16.32 | | | | (8.86 | ) | | | 0.72 | 5 | | | 0.72 | 5 | | | 2.04 | | | | 2.04 | | | $ | 360,866 | | | | 20% | |
| $ | 19.86 | | | | 15.49 | | | | 0.69 | 5 15 | | | 0.73 | 5 | | | 1.97 | 15 | | | 1.93 | | | $ | 489,011 | | | | 59% | |
| $ | 18.42 | | | | 10.09 | | | | 0.67 | 5 | | | 0.67 | 5 | | | 2.12 | | | | 2.12 | | | $ | 327,861 | | | | 131% | |
| $ | 17.08 | | | | 14.54 | | | | 0.70 | 5 | | | 0.70 | 5 | | | 2.77 | | | | 2.77 | | | $ | 224,664 | | | | 28% | |
89
| | |
| WASATCH FUNDS | | MARCH 31, 2019 (UNAUDITED) |
|
|
|
Notes to Financial Highlights
| 1 | Not annualized for periods less than one year. |
| 2 | Annualized for periods less than one year. |
| 3 | Portfolio turnover is calculated on the basis of the Fund as a whole without distinguishing between the classes of shares issued. |
| 4 | Represents amounts less than $0.005 per share. |
| 5 | Includes interest expense of less than 0.005%. |
| 6 | Includes interest expenses of more than 0.005%. |
| 7 | Includes extraordinary expenses greater than or equal to 0.01% (see Note 7 in “Notes to Financial Statements”). |
| 8 | Includes extraordinary expenses of less than 0.01% (see Note 7 in “Notes to Financial Statements”). |
| 9 | Investment income per share reflects a large,non-recurring dividend which amounted to $0.17 and $0.08 per share for the Investor Class and Institutional Class, respectively. Excluding thisnon-recurring dividend, the ratio of Net Investment Income (Loss) to Average Net Assets would have been as follows: |
| | | | | | | | | | | | |
| | | Net Investment
Income (Loss) Net
of Waivers and
Reimbursements (%)2 | | Net Investment
Income (Loss)
Before Waivers and
Reimbursements (%)2 | | |
Core Growth Fund — Investor Class | | | | (0.58 | ) | | | | (0.58 | ) | | |
Core Growth Fund — Institutional Class | | | | (0.59 | ) | | | | (0.60 | ) | | |
10Investment income per share reflects a large,non-recurring dividend which amounted to $0.04 per share. Excluding thisnon-recurring dividend, the ratio of Net Investment Income (Loss) to Average Net Assets would have been (1.40)%. 11Investment income per share reflects a large,non-recurring dividend which amounted to $0.01 per share. Excluding thisnon-recurring dividend, the ratio of Net Investment Income (Loss) to Average Net Assets would have been (1.04)% for Net Investment Income Net of Waivers and Reimbursements and (1.10)% for Net Investment Income Before Waivers and Reimbursements. 12Investment income per share reflects a large,non-recurring dividend which amounted to $0.05 and $0.05 per share for the Investor Class and Institutional Class, respectively. Excluding thisnon-recurring dividend, the ratio of Net Investment Income (Loss) to Average Net Assets would have been as follows: |
| | | |
| | | Net Investment
Income (Loss) Net
of Waivers and
Reimbursements (%)2 | | Net Investment
Income (Loss)
Before Waivers and
Reimbursements (%)2 | | |
Small Cap Value Fund — Investor Class | | | | — | 13 | | | | — | 13 | | |
Small Cap Value Fund — Institutional Class | | | | 0.10 | | | | | 0.05 | | | |
13Amount is less than 0.005%. 14Institutional class inception date was February 1, 2016. 15Includes reimbursement by Hoisington Investment Management Co., theSub-Advisor, for proxy statement expenses which amounted to $0.01 per share. 16Includes anon-recurring offer to reimburse prior period custody and fund accountingout-of-pocket expenses (see Note 7 “Related Party Transactions” “CustodianOut-of-Pocket Expense Reimbursement” in “Notes to Financial Statements”). Excluding thisnon-recurring reimbursement, the Ratio of Expenses to Average Net Assets would have been as follows: |
| | | |
| | | Expenses Net of
Waivers and
Reimbursements (%)2 | | Expenses Before
Waivers and
Reimbursements (%)2 | | |
Core Growth Fund — Investor Class | | | | 1.21 | | | | | 1.21 | | | |
Core Growth Fund — Institutional Class | | | | 1.07 | | | | | 1.09 | | | |
Emerging India Fund — Investor Class | | | | 1.84 | | | | | 1.98 | | | |
Emerging India Fund — Institutional Class | | | | 1.56 | | | | | 2.06 | | | |
Emerging Markets Select Fund — Investor Class | | | | 1.60 | | | | | 2.00 | | | |
Emerging Markets Select Fund — Institutional Class | | | | 1.33 | | | | | 1.63 | | | |
Emerging Markets Small Cap Fund — Investor Class | | | | 1.97 | | | | | 2.01 | | | |
Emerging Markets Small Cap Fund — Institutional Class | | | | 1.82 | | | | | 1.83 | | | |
Frontier Emerging Small Countries Fund — Investor Class | | | | 2.25 | | | | | 2.39 | | | |
Frontier Emerging Small Countries Fund — Institutional Class | | | | 2.08 | | | | | 2.08 | | | |
Global Opportunities Fund — Investor Class | | | | 1.64 | | | | | 1.64 | | | |
Global Opportunities Fund — Institutional Class | | | | 1.42 | | | | | 2.39 | | | |
Global Value Fund — Investor Class | | | | 1.10 | | | | | 1.17 | | | |
Global Value Fund — Institutional Class | | | | 0.96 | | | | | 1.72 | | | |
International Growth Fund — Investor Class | | | | 1.48 | | | | | 1.48 | | | |
International Growth Fund — Institutional Class | | | | 1.36 | | | | | 1.37 | | | |
International Opportunities Fund ��� Investor Class | | | | 2.26 | | | | | 2.30 | | | |
International Opportunities Fund — Institutional Class | | | | 1.97 | | | | | 2.06 | | | |
Micro Cap Fund | | | | 1.92 | | | | | 1.92 | | | |
Micro Cap Value Fund | | | | 1.96 | | | | | 2.05 | | | |
Small Cap Growth Fund — Investor Class | | | | 1.29 | | | | | 1.29 | | | |
Small Cap Growth Fund — Institutional Class | | | | 1.05 | | | | | 1.11 | | | |
Small Cap Value Fund — Investor Class | | | | 1.24 | | | | | 1.24 | | | |
Small Cap Value Fund — Institutional Class | | | | 1.08 | | | | | 1.20 | | | |
Ultra Growth Fund | | | | 1.34 | | | | | 1.34 | | | |
U.S. Treasury Fund | | | | 0.69 | | | | | 0.73 | | | |
17Per share amounts do not correlate to amounts reported in the Statements of Operations due to timing of share activity. 18Net Realized and Unrealized Gains (Losses) on Investments per share reflects a large,non-recurring receivable for security litigation which amounted to $0.06 and $0.06 per share for the Investor Class and Institutional Class, respectively. Excluding thisnon-recurring receivable, Net Realized and Unrealized Gains (Losses) on Investments would have been $0.59 and $0.60 per share for the Investor Class and Institutional Class, respectively. Excluding thisnon-recurring receivable, Total Return would have been 8.74% and 8.91% for the Investor Class and Institutional Class, respectively. |
See Notes to Financial Statements.
90
| | |
| WASATCH FUNDS | | MARCH 31, 2019 (UNAUDITED) |
|
|
|
Notes to Financial Statements
1. ORGANIZATION
Wasatch Funds Trust (the “Trust”) is a Massachusetts business trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as anopen-end management investment company and consists of 15 series or funds (each a “Fund” and collectively the “Funds”). The Core Growth Fund, Emerging India Fund, Emerging Markets Select Fund, Emerging Markets Small Cap Fund, Frontier Emerging Small Countries Fund, Global Opportunities Fund, Global Value Fund (formerly Large Cap Value Fund), International Growth Fund, International Opportunities Fund, Micro Cap Fund, Micro Cap Value Fund, Small Cap Growth Fund, Small Cap Value Fund, Ultra Growth Fund, and Wasatch-Hoisington U.S. Treasury Fund (“U.S. Treasury Fund”)(sub-advised) are each diversified funds. Each Fund maintains its own investment objective(s).
On November 9, 2011, the Trustre-designated the shares of the Funds into Investor Class shares effective January 31, 2012, and authorized and designated a new Institutional Class of shares in the Funds. Currently 11 funds offer Institutional Class shares: Core Growth Fund, Global Value Fund and Small Cap Value Fund, which commenced operations on January 31, 2012, Emerging Markets Select Fund, which commenced operations on December 13, 2012 and Emerging India Fund, Emerging Markets Small Cap Fund, Frontier Emerging Small Countries Fund, Global Opportunities Fund, International Growth Fund, International Opportunities Fund and Small Cap Growth Fund, which commenced operations on February 1, 2016. Each class of shares for each Fund has identical rights and privileges except with respect to purchase minimums, distribution and service charges, shareholder services, voting rights on matters affecting a single class of shares, and the exchange and conversion features. The Funds have entered into an investment advisory agreement with Wasatch Advisors, Inc. (the “Advisor” or “Wasatch”) as investment advisor.
The Core Growth, Emerging India, Emerging Markets Select, Emerging Markets Small Cap, Frontier Emerging Small Countries, Global Opportunities, Global Value, International Growth, International Opportunities, Micro Cap, Micro Cap Value, Small Cap Growth, Small Cap Value and Ultra Growth Funds are referred to herein as the “Equity Funds.”
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant policies related to investments of the Funds held at March 31, 2019. These policies are in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Valuation of Securities — All investments in securities are recorded at their estimated fair value as described in Note 12.
Foreign Currency Translations — Values of investments denominated in foreign currencies are converted into U.S. dollars using the current exchange rates each business day (generally 4:00 p.m. Eastern Time). Purchases and sales of investments and dividend income are translated into U.S. dollars using the current prevailing exchange rate on the
transaction date. The effect of changes in foreign exchange rates on realized and unrealized gains or losses on securities is reflected as a component of such gains or losses. Transactions in foreign denominated assets may involve greater risks than domestic transactions.
Investment in Securities and Related Investment Income — Security transactions are accounted for on the trade date. Gains or losses on securities sold are determined on the identified cost basis. Dividend income and distributions to shareholders are recorded on theex-dividend date except that certain dividends from foreign securities may be recorded after theex-dividend date based on when the Fund is informed of the dividend. Interest income and estimated expenses are accrued daily. Bond discount and premiums are amortized using the interest method. To the extent dividends received include return of capital or capital gain distributions, such distributions are recorded as a reduction to cost of the related security or as realized gain or loss.
Expenses — The Funds contract for various services on a collective basis. Most expenses are directly attributable to each Fund and therefore are charged accordingly. Expenses that are not directly attributable to one or more Funds are allocated among applicable Funds on an equitable and consistent basis considering such things as the nature and type of expense and the relative net assets of the Funds.
Use of Management Estimates — The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported changes in net assets 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 that contain a variety of representations and warranties which provide general indemnifications. The maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds and/or their affiliates that have not yet occurred. Based on experience, however, the risk of loss is expected to be remote.
Redemption Fees — The Funds deduct a fee of 2.00% from redemption proceeds on shares of the Funds held 60 days or less. Redemption fees retained by the Funds are credited to additionalpaid-in capital.
New Accounting Pronouncements — In October 2018, the U.S. Securities and Exchange Commission adopted amendments to certain disclosure requirements that had become “redundant, duplicative, overlapping, outdated or superseded, in light of the other Commission disclosure requirements, GAAP or changes in the information environment.” The compliance date for the amendments to RegulationS-X is November 5, 2018 (for reporting period end dates of September 30, 2018 or after). Management has evaluated the impact of the amendments and determined the effect on the financial statements of adopting the simplification rules will be limited to a change in disclosures at March 31, 2019.
Other — Income, expenses, and realized and unrealized gains or losses on investments are generally allocated to each
91
Notes to Financial Statements (continued)
class of shares based on its relative net assets, except that each class separately bears expenses related specifically to that class, such as certain shareholder servicing fees.
3. SECURITIESAND OTHER INVESTMENTS
Repurchase Agreements — The Funds may engage in repurchase transactions. Under the terms of a typical repurchase agreement, a fund takes possession of an underlying debt obligation subject to an obligation of the seller to repurchase and the fund to resell the obligation at an agreed upon price and time. The market value of the collateral must be at least equal at all times to the total amount of the repurchase obligation, including interest. Generally, in the event of counterparty default, the fund has the right to use the collateral to offset losses incurred.
Short Sales — The Equity Funds may enter into short sales whereby a fund sells a security it generally does not own (the security is borrowed), in anticipation of a decline in the security’s price. The initial amount of a short sale is recorded as a liability which ismarked-to-market daily. Fluctuations in the value of the short liability are recorded as unrealized gains or losses. If a Fund shorts a security when also holding a long position in the security (a “short against the box”), as the security’s price declines, the short position increases in value, offsetting the long position’s decrease in value. The opposite effect occurs if the security’s price rises. A Fund realizes a gain or loss upon closing of the short sale (returning the security to the counterparty by way of purchase or delivery of a long position owned). Possible losses from short sales may be unlimited, whereas losses from security purchases cannot exceed the total amount invested. The Funds are liable to the buyer for any dividends payable on securities while those securities are in a short position. These dividends are an expense of the Funds. The Funds designate collateral consisting of cash, U.S. government securities or other liquid assets sufficient to collateralize the market value of short positions.
Participation Notes — Certain Funds may invest in Participation Notes(P-Notes).P-Notes are promissory notes that are designed to offer a return linked to the performance of a particular underlying equity security ormarket. P-Notes are issued by banks or broker-dealers and allow a fund to gain exposure to common stocks in markets in which the fund is currently not approved to directly invest, or in markets that prohibit direct investment by foreign purchasers. While the holder of aP-Note is entitled to receive from the bank or broker-dealer any dividends or other distributions paid on the underlying securities, the holder is not entitled to the same rights as an owner of the underlying securities, such as voting rights. Income received fromP-Notes is recorded as dividend income in the Statement of Operations.P-Notes are considered general unsecured contractual obligations of the bank or broker-dealer. Risks associated withP-Notes include the possible failure of a counterparty (i.e., the issuing bank or broker-dealer) to perform in accordance with the terms of the agreement, inability to transfer or liquidate the notes, potential delays or an inability to redeem the notes before maturity under certain market conditions, and limited legal recourse against the issuer of the underlying common stock.
4. FINANCIAL DERIVATIVE INSTRUMENTS
Foreign Currency Contracts — The Funds may enter into foreign currency contracts to settle planned purchases or sales of securities or to protect against a possible loss resulting from an adverse change in the relationship between the U.S. dollar and a foreign currency involved in an underlying transaction. Foreign currency contracts are agreements between two parties to buy and sell a currency at a set price on a future date. The market value of a foreign currency contract fluctuates with changes in currency exchange rates. Foreign currency contracts aremarked-to-market daily and the change in market value is recorded by a fund as unrealized appreciation or depreciation. When a foreign currency contract is closed, the fund records a realized gain or loss equal to the difference between the value at the time it was opened and the value at the time it was closed. These contracts may involve market risk in excess of the unrealized gain or loss reflected in the Schedule of Investments. In addition, a fund could be exposed to credit risk if a counterparty is unable or unwilling to meet the terms of the contracts or if the value of the currency changes unfavorably. In connection with these contracts, the Funds may segregate cash and/or securities in a sufficient amount as collateral in accordance with the terms of the respective contracts.
Options Transactions — The Equity Funds may buy and sell put and call options and write covered put and call options, includingover-the-counter options, on portfolio securities where the completion of the obligation is dependent upon the credit standing of another party. Options are a type of derivative financial instrument. The Funds may invest in derivative financial instruments, including options, in order to manage risk or gain exposure to various other investments or markets. The risk in writing a call option is that a fund gives up the opportunity for profit if the market price of the security increases. The risk in writing a put option is that a fund may incur a loss if the market price of the security decreases and the option is exercised. The risk in buying an option is that a fund pays a premium whether or not the option is exercised. A fund also has the additional risk of not being able to enter into a closing transaction if a liquid secondary market does not exist. Possible losses from uncovered written options may be unlimited. Option contracts are valued daily and unrealized appreciation or depreciation is recorded. A fund will realize a gain or loss upon expiration or closing of the option transaction. When an option is exercised, the proceeds on sales for a written call option, the purchase cost for a written put option, or the cost of a security for a purchased put or call option is adjusted by the amount of premium received or paid. The Funds designate collateral consisting of cash, U.S. government securities or other liquid assets sufficient to collateralize the market value of written options.
Refer to Note 13 (Offsetting) for more information about the offsetting of assets and liabilities.
92
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
5. PURCHASESAND SALESOF SECURITIES
The cost of investment securities purchased and proceeds from sales of investment securities, excluding U.S. government and short-term securities, for the six months ended March 31, 2019 are summarized below:
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Core
Growth
Fund | | Emerging
India
Fund | | Emerging
Markets
Select
Fund | | Emerging
Markets
Small Cap
Fund | | Frontier
Emerging
Small Countries
Fund |
Purchases | | | $ | 352,738,725 | | | | $ | 29,930,520 | | | | $ | 1,495,578 | | | | $ | 21,814,054 | | | | $ | 29,883,144 | |
Sales | | | | 324,609,413 | | | | | 22,099,433 | | | | | 2,648,159 | | | | | 117,126,066 | | | | | 47,389,549 | |
| | | | | |
| | | Global
Opportunities
Fund | | Global
Value
Fund | | International
Growth
Fund | | International
Opportunities
Fund | | Micro
Cap
Fund |
Purchases | | | $ | 12,172,529 | | | | $ | 34,920,174 | | | | $ | 266,768,786 | | | | $ | 76,318,485 | | | | $ | 149,516,619 | |
Sales | | | | 17,326,451 | | | | | 56,071,567 | | | | | 351,022,849 | | | | | 165,627,659 | | | | | 150,342,549 | |
| | | | | |
| | | Micro Cap
Value
Fund | | Small Cap
Growth
Fund | | Small Cap
Value
Fund | | Ultra
Growth
Fund | | |
Purchases | | | $ | 81,791,283 | | | | $ | 203,408,597 | | | | $ | 166,837,298 | | | | $ | 217,367,145 | | | | | | |
Sales | | | | 84,651,413 | | | | | 345,876,139 | | | | | 77,880,984 | | | | | 29,653,085 | | | | | | |
Purchases and sales of U.S. government securities in the U.S. Treasury Fund were $42,067,174 and $44,297,021, respectively.
6. FEDERAL INCOME TAX INFORMATION
It is each Fund’s policy to comply with the requirements under Subchapter M of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all taxable income to shareholders. The Funds are no longer subject to examination by tax authorities for years prior to 2016. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total of amounts of unrecognized tax benefits will significantly change in the next 12 months. Accordingly, no provision for federal income or excise taxes has been made.
As of March 31, 2019, the cost and unrealized appreciation (depreciation) of securities on a tax basis were as follows:
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Core
Growth
Fund | | Emerging
India
Fund | | Emerging
Markets
Select
Fund | | Emerging
Markets
Small Cap
Fund | | Frontier
Emerging
Small
Countries
Fund |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Cost | | | $ | 1,527,235,232 | | | | $ | 208,243,549 | | | | $ | 36,590,349 | | | | $ | 318,129,911 | | | | $ | 60,341,502 | |
| | | | | |
Gross appreciation | | | $ | 774,423,018 | | | | $ | 69,666,404 | | | | $ | 11,158,402 | | | | $ | 143,533,088 | | | | $ | 8,418,135 | |
Gross (depreciation) | | | | (137,322,552 | ) | | | | (6,840,021 | ) | | | | (1,632,069 | ) | | | | (23,746,267 | ) | | | | (5,328,101 | ) |
| | | | | |
Net appreciation | | | $ | 637,100,466 | | | | $ | 62,826,383 | | | | $ | 9,526,333 | | | | $ | 119,786,821 | | | | $ | 3,090,034 | |
| | | | | |
| | | | | |
| | | Global
Opportunities
Fund | | Global
Value
Fund | | International
Growth
Fund | | International
Opportunities
Fund | | Micro
Cap
Fund |
Cost | | | $ | 82,444,456 | | | | $ | 158,447,897 | | | | $ | 993,227,284 | | | | $ | 301,844,885 | | | | $ | 355,609,455 | |
| | | | | |
Gross appreciation | | | $ | 41,141,010 | | | | $ | 22,649,402 | | | | $ | 361,198,636 | | | | $ | 133,161,183 | | | | $ | 119,862,507 | |
Gross (depreciation) | | | | (7,311,614 | ) | | | | (10,434,937 | ) | | | | (80,072,029 | ) | | | | (21,303,653 | ) | | | | (26,589,903 | ) |
| | | | | |
Net appreciation | | | $ | 33,829,396 | | | | $ | 12,214,465 | | | | $ | 281,126,607 | | | | $ | 111,857,530 | | | | $ | 93,272,604 | |
| | | | | |
93
Notes to Financial Statements (continued)
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Micro Cap
Value
Fund | | Small Cap
Growth
Fund | | Small Cap
Value
Fund | | Ultra
Growth
Fund | | U.S.
Treasury
Fund |
Cost | | | $ | 196,420,591 | | | | $ | 1,115,099,363 | | | | $ | 421,959,925 | | | | $ | 440,944,427 | | | | $ | 336,388,700 | |
| | | | | |
Gross appreciation | | | $ | 66,952,753 | | | | $ | 669,796,321 | | | | $ | 109,588,048 | | | | $ | 89,372,482 | | | | $ | 6,792,917 | |
Gross (depreciation) | | | | (12,502,252 | ) | | | | (107,008,282 | ) | | | | (26,089,001 | ) | | | | (27,546,711 | ) | | | | (15,175,135 | ) |
| | | | | |
Net appreciation (depreciation) | | | $ | 54,450,501 | | | | $ | 562,788,039 | | | | $ | 83,499,047 | | | | $ | 61,825,771 | | | | $ | (8,382,218 | ) |
| | | | | |
The difference between book-basis andtax-basis unrealized gains is primarily attributable to the tax deferral of losses on wash sales, unrealized appreciation on passive foreign investment companies (PFICs), partnership adjustments and other temporary tax adjustments.
The amount and character oftax-basis distributions and composition of net assets are finalized at fiscal year-end. Accordingly, tax basis balances have not been determined as of the date of this report.
Dividends from net investment income and net realized gains, if any, are declared and paid at least annually for all Funds, except for dividends from net investment income in two funds. The Global Value and U.S. Treasury Funds declare and pay dividends quarterly. The amount of dividends and distributions from net investment income and net realized gains are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP. The Funds may utilize earnings and profits distributed to shareholders on redemption of shares as part of the dividends paid deduction (tax equalization).
To the extent these book and tax differences are permanent in nature, such amounts are reclassified at the end of the fiscal year among additionalpaid-in capital, undistributed net investment income (loss), and undistributed net realized gain (loss) on investments, options and foreign currency translations. The reclassifications generally relate to the tax treatment of net operating losses, the netting of net operating loss to short-term gains, investments in REITs and partnerships, redemptionsin-kind, distribution reclassifications, foreign capital gains taxes, Section 988 currency gains and losses, PFICs, paydown gains and losses,non-REIT return of capital dividends and equalization. These reclassifications have no impact on the net asset values of the Funds.
Capital loss carryforwards are available through the date specified below to offset future realized net capital gains for federal income tax purposes. Future capital loss carryover utilization in any given year may be subject to Internal Revenue Code limitations. To the extent future gains are offset by capital loss carryforwards, such gains will not be distributed.
Under the Regulated Investment Company Modernization Act of 2010, a Fund will be permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an unlimited period. Post-enactment losses that are carried forward will retain their character as either short-term or long-term capital losses rather than being considered all short-term as under previous law.
Capital loss carryforwards as of September 30, 2018 are as follows:
| | | | | | | | | | |
| | | Non-expiring |
| Fund | | Short Term | | Long Term |
Emerging Markets Select Fund | | | $ | 4,595,885 | | | | $ | — | |
Frontier Emerging Small Countries Fund | | | | 92,845,849 | | | | | 15,281,425 | |
Global Value Fund* | | | | 24,394,990 | | | | | 140,073,369 | |
U.S. Treasury Fund | | | | 11,360,448 | | | | | 5,529,043 | |
| * | The Fund’s capital loss carryforward is subject to an annual limitation under the Internal Revenue Code and related regulations. |
During the tax year ended September 30, 2018, the Funds used capital loss carryforwards in the following amounts:
| | | | | |
| Fund | | Amount Used |
Emerging Markets Select Fund | | | $ | 4,355,751 | |
Emerging Markets Small Cap Fund | | | | 11,373,715 | |
Frontier Emerging Small Countries Fund | | | | 43,422,052 | |
The Funds have elected to defer losses incurred from November 1, 2017 through September 30, 2018 in accordance with federal income tax rules. These losses are treated as having arisen on the first day of the following fiscal year. The Funds have elected to defer losses as follows:
| | | | | | | | | | |
| Fund | | Post-October
Capital Losses | | Late-Year Ordinary
Losses |
Core Growth Fund | | | $ | — | | | | $ | 9,445,183 | |
Emerging India Fund | | | | 2,369,031 | | | | | 2,609,962 | |
Emerging Markets Select Fund | | | | — | | | | | 222,936 | |
Emerging Markets Small Cap Fund | | | | — | | | | | 3,513,046 | |
94
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | |
| Fund | | Post-October
Capital Losses | | Late-Year Ordinary
Losses |
Global Opportunities Fund | | | $ | — | | | | $ | 720,294 | |
International Opportunities Fund | | | | — | | | | | 2,942,677 | |
Micro Cap Fund | | | | — | | | | | 4,029,779 | |
Small Cap Growth Fund | | | | — | | | | | 10,640,221 | |
Small Cap Value Fund | | | | 2,338,541 | | | | | 69,009 | |
EU Reclaims — As a result of several court cases in certain countries across the European Union, the Emerging Markets Small Cap Fund, Global Opportunities Fund, Global Value Fund, International Growth Fund and International Opportunities Fund filed tax reclaims for previously withheld taxes on dividends earned in Finland and Poland (EU Reclaims). These additional filings are subject to various administrative proceedings by the local jurisdictions’ tax authorities within the European Union, as well as a number of related judicial proceedings. Income recognized, if any, for EU reclaims is reflected as dividend income in the Statements of Operations and related receivables, if any, are reflected as interest and dividends receivable in the Statements of Assets and Liabilities. When uncertainty exists as to the ultimate resolution of these proceedings, the likelihood of receipt of these EU reclaims and the potential timing of payment, no amounts are reflected in the financial statements.
7. RELATED PARTY TRANSACTIONS
Investment Advisory Fees, Expense Limitations — As the Funds’ investment advisor, the Advisor receives a monthly fee calculated on average daily net assets. The Advisor has contractually agreed to waive its fees and/or reimburse certain Funds should a Fund’s operating expenses exceed a specified annual limitation through at least January 31, 2020. If operating expenses are less than the specified expense limit for the Fund, the Advisor shall be entitled to recoup the fees waived or reduced to the extent that the operating expenses and the amounts reimbursed do not exceed such expense limit for the Fund, under the period of the agreement (currently through January 31, 2020). The Funds may only make repayments to the Advisor for the amounts reimbursed if such repayment does not cause the Funds’ expense ratio, after repayment is take into account, to exceed both (i) the expense cap at the time such amounts were waived; and (ii) the Fund’s current expense cap. All amounts not recovered at the end of the period expire on January 31, 2020. Shareholder expenses will increase if the Advisor does not renew the contractual expense cap after its expiration date. Ordinary operating expenses exclude any interest, dividend expense on short sales/interest expense, taxes, brokerage commissions, other investment-related costs and extraordinary expenses, such as litigation and other expenses not incurred in the ordinary course of the Funds’ business. The Wasatch Funds’ Board of Trustees determined that the costs of the Proxy Statement related to the identification and shareholder approval of Trustee Nominees were extraordinary expenses. Investment advisory fees and fees waived, if any, for the six months ended March 31, 2019 are disclosed in the Statements of Operations. Investment advisory fee and expense limitation annual rates are shown below.
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Fund | | Advisory
Fee | | Expense
Limitation
Investor Class | | Expense
Limitation
Institutional Class | | Contractual Expense
Limitation/
Reimbursement
Recoverable
Expiration Date | | Reimbursement
Recoverable |
Core Growth Fund | | | | 1.00% | | | | | 1.50% | | | | | 1.05% | | | | | 1/31/2020 | | | | $ | 120,191 | |
Emerging India Fund | | | | 1.25% | | | | | 1.75% | | | | | 1.50% | | | | | 1/31/2020 | | | | | 12,420 | |
Emerging Markets Select Fund | | | | 1.00% | | | | | 1.50% | | | | | 1.20% | | | | | 1/31/2020 | | | | | 77,076 | |
Emerging Markets Small Cap Fund | | | | 1.65% | | | | | 1.95% | | | | | 1.80% | | | | | 1/31/2020 | | | | | 153,075 | |
Frontier Emerging Small Countries Fund | | | | 1.65% | | | | | 2.15% | | | | | 1.95% | | | | | 1/31/2020 | | | | | 136,764 | |
Global Opportunities Fund | | | | 1.25% | | | | | 1.75% | | | | | 1.35% | | | | | 1/31/2020 | | | | | 17,568 | |
Global Value Fund | | | | 0.90% | | | | | 1.10% | | | | | 0.95% | | | | | 1/31/2020 | | | | | 107,412 | |
International Growth Fund | | | | 1.25% | | | | | 1.75% | | | | | 1.35% | | | | | 1/31/2020 | | | | | 18,843 | |
International Opportunities Fund | | | | 1.75% | | | | | 2.25% | | | | | 1.95% | | | | | 1/31/2020 | | | | | 39,696 | |
Micro Cap Fund | | | | 1.50% | | | | | 1.95% | | | | | N/A | | | | | 1/31/2020 | | | | | — | |
Micro Cap Value Fund | | | | 1.50% | | | | | 1.95% | | | | | N/A | | | | | 1/31/2020 | | | | | — | |
Small Cap Growth Fund | | | | 1.00% | | | | | 1.50% | | | | | 1.05% | | | | | 1/31/2020 | | | | | 123,827 | |
Small Cap Value Fund | | | | 1.00% | | | | | 1.50% | | | | | 1.05% | | | | | 1/31/2020 | | | | | 28,050 | |
Ultra Growth Fund | | | | 1.00% | | | | | 1.50% | | | | | N/A | | | | | 1/31/2020 | | | | | — | |
U.S. Treasury Fund | | | | 0.50% | | | | | 0.75% | | | | | N/A | | | | | 1/31/2020 | | | | | — | |
Affiliated Trades — Certain Funds are permitted to purchase or sell securities from or to certain related affiliated funds under specified conditions outlined in the procedures adopted by the Board of Trustees (the “Board”). The procedures have been designed to ensure that any purchase or sale of securities by the Funds from or to another fund (or funds) that are, or could be, considered an affiliate by virtue of having a common investment advisor (or affiliated investment advisors), common Trustees and/or common officers complies with Rule17a-7 of the 1940 Act. Further, each transaction is effected at the current market price, as that term is defined under the procedures. During the six months ended March 31, 2019, the Funds did not engage in purchases or sales of securities pursuant to Rule17a-7 of the 1940 Act.
95
Notes to Financial Statements (continued)
In-Kind Transaction — In April 2017, the Wasatch International Opportunities Fund had a largein-kind redemption with an affiliated person. The transaction was effected consistent with the Funds’ Procedures for EffectingIn-Kind Redemptions and was approved in advance by the Independent Trustees of the Wasatch Funds Trust.
Compensation — Officers serve in that capacity without compensation from the Trust. Beginning in the calendar year of 2018, the Funds’ method of compensating Trustees is to pay each Independent Trustee a retainer of $120,000 per year for services rendered and a fee of $24,000 for each Board of Trustees meeting attended in person or telephonically. In addition, each Independent Trustee receives a fee of $24,000 for attendance at an executive session held with respect to the contract renewal process for the Funds. In addition, the Chairman of the Board receives an additional fee of $30,000 a year as Chairman and $6,000 for attendance in person or telephonically at a Board meeting; the Chairman of the Audit Committee and the Chairman of the Nominating Committee each receive an additional $18,000 per year as Chairman and $3,600 for attendance in person or telephonically at a Board meeting. Additionally, each Independent Trustee is entitled to reimbursement of expenses related to his or her duties as a Trustee of the Funds.
Payments by Advisor — During the 2014 fiscal year, the Advisor paid certain audit, legal and/or printing fees of the Core Growth, Emerging Markets Small Cap, Global Value, Small Cap Growth and Small Cap Value Funds. The Advisor does not intend to be reimbursed for these amounts.
On October 16, 2014, the Advisor discovered a trade error involving the Ultra Growth Fund. The Advisor reimbursed the Fund $12,267. On August 2, 2016, the Advisor discovered a trade error involving the Small Cap Growth Fund. The Advisor reimbursed the Fund $12,890.
During 2018, the Advisor paid for a portion of the expenses in connection with the merger of the Long/Short and Global Value Funds.
The impact of the payments detailed above is reflected in the net expense ratios in the Financial Highlights.
Payments bySub-Advisor — In June 2016, the Funds filed a proxy statement with the Securities and Exchange Commission to inform shareholders about a Special Meeting of Shareholders of the Wasatch-Hoisington U.S. Treasury Fund. The purpose of the Shareholder Meeting was to ask shareholders to approve a newSub-Advisory Agreement between Wasatch Advisors, Inc. and Hoisington Investment Management Company (HIMCO) with respect to the Wasatch-Hoisington U.S. Treasury Fund. HIMCO, theSub-Advisor for the Fund, reimbursed the Wasatch-Hoisington U.S. Treasury Fund for the costs associated with the proxy statement filing. TheSub-Advisor does not intend to be reimbursed for this amount.
Transfer Agent Intermediary Fees Reimbursed to the Advisor — Each Fund paid fees to, and reimbursed certainout-of-pocket expenses of, the Funds’ transfer agent during the period. In addition, the Advisor and the Funds’ distributor have entered into selling dealer agreements and service agreements with certain financial services companies, broker-dealers, banks, advisors, retirement service providers or other authorized agents or organizations (each an “Intermediary,” together, “Intermediaries”) to accept purchase, exchange and redemption orders on the Funds’ behalf. For Investor Class shares of the Funds, some Intermediaries do not charge investors a direct transaction fee, but instead charge a fee for accounting and shareholder services that the agent provided to Fund shareholders on the Funds’ behalf. Those services typically included recordkeeping, transaction processing for shareholders’ accounts, communication of tax information, income distribution and other services. Generally, the fee was either a per account charge based on the number of accounts to which the Intermediary provided such services, or was a percentage (as of March 31, 2019 up to 0.40% annually) of the average value of Fund Investor Class shares held in such accounts. The Advisor paid the Intermediary fees and the Funds reimbursed the Advisor for the portion of such fees, which is intended to compensate the Intermediary for provision of services of the type that would be provided by the Funds’ transfer agent or other service providers if the shares were registered on the books of the Funds’ transfer agent. Institutional Class shares of the Funds do not reimburse the Advisor for payments to Intermediaries. The Funds’ reimbursement of expenses incurred for services provided by Intermediaries are included in “Shareholder servicing fees — Investor Class” in the Statements of Operations.
CustodianOut-of-Pocket Expense Reimbursement — In September 2016, State Street Bank and Trust Company (“SSB”), the Funds’ custodian, provided each Fund with an offer to reimburse the Fund for certainout-of-pocket expenses it charged the Fund between 2003 and 2015. The incorrect charges were due to inaccurate billing rates used by SSB for certainout-of-pocket expenses. SSB made the reimbursements in May 2017.
10% Shareholders — As of March 31, 2019, the Funds had individual shareholder accounts and/or omnibus shareholder accounts (comprised of a group of individual shareholders), which individually amounted to more than 10% of the total shares outstanding of the Fund as detailed below:
| | | | | | | | | | |
| Fund | | Number of
Accounts | | Percent of Shares
Outstanding |
Core Growth Fund | | | | 2 | | | | | 46.94 | % |
Emerging India Fund | | | | 2 | | | | | 66.48 | % |
Emerging Markets Select Fund | | | | 3 | | | | | 69.69 | % |
Emerging Markets Small Cap Fund | | | | 4 | | | | | 72.72 | % |
Frontier Emerging Small Countries Fund | | | | 3 | | | | | 57.41 | % |
Global Opportunities Fund | | | | 3 | | | | | 57.85 | % |
Global Value Fund | | | | 2 | | | | | 71.86 | % |
International Growth Fund | | | | 2 | | | | | 56.21 | % |
96
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | |
| Fund | | Number of
Accounts | | Percent of Shares
Outstanding |
International Opportunities Fund | | | | 2 | | | | | 50.60 | % |
Micro Cap Fund | | | | 2 | | | | | 34.38 | % |
Micro Cap Value Fund | | | | 3 | | | | | 63.95 | % |
Small Cap Growth Fund | | | | 2 | | | | | 50.96 | % |
Small Cap Value Fund | | | | 2 | | | | | 42.94 | % |
Ultra Growth Fund | | | | 2 | | | | | 46.42 | % |
U.S. Treasury Fund | | | | 4 | | | | | 61.02 | % |
Affiliated Interests — As of March 31, 2019, Wasatch Advisors, Inc. and its affiliates, and the retirement plans of Wasatch Advisors, Inc. and its affiliates, held shares of the Funds which may be redeemed at any time as detailed below:
| | | | | | | | | | |
| Fund | | Number of
Accounts* | | Percent of Shares
Outstanding |
Core Growth Fund | | | | 21 | | | | | 1.13 | % |
Emerging India Fund | | | | 31 | | | | | 6.95 | % |
Emerging Markets Select Fund | | | | 22 | | | | | 20.25 | % |
Emerging Markets Small Cap Fund | | | | 19 | | | | | 2.72 | % |
Frontier Emerging Small Countries Fund | | | | 16 | | | | | 2.72 | % |
Global Opportunities Fund | | | | 17 | | | | | 7.69 | % |
Global Value Fund | | | | 10 | | | | | 1.87 | % |
International Growth Fund | | | | 17 | | | | | 0.97 | % |
International Opportunities Fund | | | | 20 | | | | | 1.57 | % |
Micro Cap Fund | | | | 16 | | | | | 0.66 | % |
Micro Cap Value Fund | | | | 17 | | | | | 3.26 | % |
Small Cap Growth Fund | | | | 17 | | | | | 1.06 | % |
Small Cap Value Fund | | | | 13 | | | | | 2.08 | % |
Ultra Growth Fund | | | | 11 | | | | | 0.64 | % |
U.S. Treasury Fund | | | | 12 | | | | | 2.26 | % |
| * | Multiple accounts with the same beneficial owner are treated as one account. |
8. TRANSACTIONSWITH AFFILIATES
If a Fund’s holding represents ownership of 5% or more of the voting securities of a company, the company is deemed to be an affiliate as defined by the 1940 Act. The following Funds conducted transactions during the six months ended March 31, 2019 with an “affiliated company” as so defined:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Share Activity | | Dividends
Credited to
Income for the period ended
3/31/2019 | | Gain (Loss)
Realized on
Sale of Shares
for the period ended
3/31/2019 | | Change in
Unrealized
Appreciation (Depreciation) for the period ended
3/31/2019 |
| | | Balance
9/30/2018 | | Purchases/
Additions | | Sales/
Reductions | | Balance
3/31/2019 |
Micro Cap Fund | | | | | | | | | | | | | | | | | | | | | | | | | | |
Construction Partners, Inc., Class A | | | | 391,500 | | | | | 238,545 | | | | | 6,088 | | | | | 623,957 | | | | $ | — | | | | $ | — | | | | $ | 633,968 | |
IRIDEX Corp. | | | | 765,198 | | | | | 11,450 | | | | | 9,250 | | | | | 767,398 | | | | | — | | | | | — | | | | | (1,371,704 | ) |
| | | | | |
| | | | 1,156,698 | | | | | 249,995 | | | | | 15,338 | | | | | 1,391,355 | | | | $ | — | | | | $ | — | | | | $ | (737,736 | ) |
| | | | | |
Micro Cap Value Fund | | | | | | | | | | | | | | | | | | | | | | | | | | |
IRIDEX Corp. | | | | 427,793 | | | | | 58,207 | | | | | — | | | | | 486,000 | | | | $ | — | | | | $ | — | | | | $ | (821,462 | ) |
One Stop Systems, Inc. | | | | 549,990 | | | | | 175,010 | | | | | — | | | | | 725,000 | | | | | — | | | | | — | | | | | (1,079,394 | ) |
| | | | | |
| | | | 977,783 | | | | | 233,217 | | | | | — | | | | | 1,211,000 | | | | $ | — | | | | $ | — | | | | $ | (1,900,856 | ) |
| | | | | |
9. RESTRICTED SECURITIES
The Funds may own investments that were purchased through private placement transactions or under Rule 144A of the Securities Act of 1933 (the “Securities Act”) and cannot be sold without prior registration under the Securities Act or may be limited due to certain restrictions. These securities are generally deemed to be illiquid and are valued at fair value as determined by a designated Pricing Committee of the Advisor (“Pricing Committee”), comprised of personnel of the Advisor, with oversight by the
97
Notes to Financial Statements (continued)
Board of Trustees and in accordance with Board-approved Pricing Policies and Procedures. If and when such securities are registered, the costs of registering such securities are paid by the issuer. At March 31, 2019, the Funds held the following restricted securities:
| | | | | | | | | | | | | | | | | | | | | | |
| | | Security
Type | | Acquisition
Date | | Cost | | Fair
Value | | Value as a Percent
of Net Assets |
Micro Cap Fund | | | | | | | | | | | | | | | | | | | | | | |
Medallia, Inc. | | Common Stock | | | | 10/19/18 | | | | $ | 2,500,000 | | | | $ | 5,990,415 | | | | | 1.34 | % |
Medallia, Inc., Series F | | Preferred Stock | | | | 2/25/19 | | | | | 2,749,995 | | | | | 2,749,995 | | | | | 0.61 | % |
| | | | | | | | | | | | |
| | | | | | | | | | $ | 5,249,995 | | | | $ | 8,740,410 | | | | | 1.95 | % |
|
| |
Micro Cap Value Fund | | | | | | | | | | | | | | | | | | | | | | |
Acetylon Pharmaceuticals, Inc. | | Rights | | | | 12/21/16 | | | | $ | — | | | | $ | 391,628 | | | | | 0.15 | % |
Cocrystal Pharma, Inc. | | Common Stock | | | | 3/13/19 | | | | | 634,230 | | | | | 597,780 | | | | | 0.24 | % |
Regenacy Pharmaceuticals, LLC | | LLC Membership Interest | | | | 12/21/16 | | | | | 30,001 | | | | | 20,211 | | | | | 0.01 | % |
Vertex Energy, Inc., Pfd., 6.00% PIK Series B | | Convertible Preferred Stock | | | | 1/8/19 | | | | | 1,816,132 | | | | | 1,898,802 | | | | | 0.76 | % |
Vertex Energy, Inc., expiring 12/24/2020 | | Warrants | | | | 6/22/15 | | | | | 95,000 | | | | | 22,500 | | | | | 0.01 | % |
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | $ | 2,575,363 | | | | $ | 2,930,921 | | | | | 1.17 | % |
|
| |
Small Cap Growth Fund | | | | | | | | | | | | | | | | | | | | | | |
DataStax, Inc., Series E Pfd. | | Preferred Stock | | | | 8/12/14 | | | | $ | 8,000,002 | | | | $ | 11,536,213 | | | | | 0.69 | % |
Drilling Info Holdings, Inc., | | Seller’s Note | | | | 8/23/18 | | | | | 937,635 | | | | | 1,728,000 | | | | | 0.10 | % |
Greenspring Global PartnersII-B, L.P. | | LP Interest | | | | 10/10/03 - 3/31/17 | | | | | 1,807,860 | | | | | 1,635,311 | | | | | 0.10 | % |
Greenspring Global PartnersIII-B, L.P. | | LP Interest | | | | 3/16/06 - 6/29/17 | | | | | 583,376 | | | | | 917,101 | | | | | 0.05 | % |
Medallia, Inc. — Series F | | Preferred Stock | | | | 2/25/19 | | | | | 10,000,005 | | | | | 10,000,005 | | | | | 0.59 | % |
Nanosys, Inc., Series D Pfd. | | Preferred Stock | | | | 11/8/05 | | | | | 2,000,000 | | | | | 454,237 | | | | | 0.03 | % |
Nanosys, Inc., Series E Pfd. | | Preferred Stock | | | | 8/13/10 | | | | | 184,939 | | | | | 192,208 | | | | | 0.01 | % |
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | $ | 23,513,817 | | | | $ | 26,463,075 | | | | | 1.57 | % |
|
| |
Ultra Growth Fund | | | | | | | | | | | | | | | | | | | | | | |
Cocrystal Pharma, Inc. | | Common Stock | | | | 3/13/19 | | | | $ | 1,365,030 | | | | $ | 1,286,580 | | | | | 0.26 | % |
Drilling Info Holdings, Inc., | | Seller’s Note | | | | 8/23/18 | | | | | 70,858 | | | | | 132,000 | | | | | 0.03 | % |
Greenspring Global PartnersII-B, L.P. | | LP Interest | | | | 10/10/03 - 3/31/17 | | | | | 1,629,178 | | | | | 1,471,772 | | | | | 0.30 | % |
Greenspring Global PartnersIII-B, L.P. | | LP Interest | | | | 3/16/06 - 6/29/17 | | | | | 584,388 | | | | | 917,101 | | | | | 0.18 | % |
Medallia, Inc., Series F | | Preferred Stock | | | | 2/25/19 | | | | | 2,250,000 | | | | | 2,250,000 | | | | | 0.45 | % |
Nanosys, Inc., Series D Pfd. | | Preferred Stock | | | | 11/8/06 | | | | | 500,001 | | | | | 113,560 | | | | | 0.02 | % |
Nanosys, Inc., Series E Pfd. | | Preferred Stock | | | | 8/13/10 | | | | | 46,235 | | | | | 48,052 | | | | | 0.01 | % |
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | $ | 6,445,690 | | | | $ | 6,219,065 | | | | | 1.25 | % |
|
| |
10. LINEOF CREDIT
Effective May 17, 2018, the Funds in the Trust renewed and amended agreements for two open lines of credit totaling $300,000,000, one of which is $100,000,000 committed, and the other of which is $200,000,000 uncommitted, with State Street Bank and Trust Company (together, the “Line”). The agreements, as amended, have no change in the committed, uncommitted and total amounts available on the Line. The Funds incur commitment fees on the undrawn portion of the committed part of the Line, and interest expense to the extent of amounts drawn (borrowed) under the entire Line. Interest is based on the higher of (a) the overnight federal-funds rate in effect on the date of borrowing, plus a margin, or (b) the daily1-Month London Interbank Offered Rate (LIBOR) in effect on the date of borrowing, plus a margin. Commitment fees arepro-rated among the Funds based upon relative average net assets. Interest expense is charged directly to a Fund based upon actual amounts borrowed by that Fund.
For the six months ended March 31, 2019, the following Funds had borrowings:
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Funds Utilizing the Line of Credit | | Average Daily
Borrowings | | Number of
Days
Outstanding | | Interest
Expense | | Weighted
Average
Annualized
Interest Rate | | Balance at
3/31/2019 |
Core Growth Fund | | | $ | 6,244,137 | | | | | 9 | | | | $ | 5,809 | | | | | 3.72 | % | | | $ | — | |
Emerging India Fund | | | | 1,337,489 | | | | | 36 | | | | | 4,745 | | | | | 3.55 | % | | | | — | |
Emerging Markets Select Fund | | | | 337,397 | | | | | 20 | | | | | 699 | | | | | 3.73 | % | | | | — | |
Emerging Markets Small Cap Fund | | | | 5,018,360 | | | | | 78 | | | | | 40,028 | | | | | 3.68 | % | | | | 859,296 | |
Frontier Emerging Small Countries Fund | | | | 4,643,599 | | | | | 66 | | | | | 30,451 | | | | | 3.58 | % | | | | — | |
Global Opportunities Fund | | | | 479,264 | | | | | 32 | | | | | 1,579 | | | | | 3.71 | % | | | | — | |
98
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | |
| Funds Utilizing the Line of Credit | | Average Daily
Borrowings | | Number of
Days
Outstanding | | Interest
Expense | | Weighted
Average
Annualized
Interest Rate | | Balance at
3/31/2019 |
Global Value Fund | | | $ | 1,056,934 | | | | | 5 | | | | $ | 551 | | | | | 3.76 | % | | | $ | — | |
International Growth Fund | | | | 14,047,253 | | | | | 12 | | | | | 17,529 | | | | | 3.74 | % | | | | — | |
International Opportunities Fund | | | | 13,007,762 | | | | | 30 | | | | | 40,728 | | | | | 3.76 | % | | | | — | |
Micro Cap Fund | | | | 3,196,952 | | | | | 15 | | | | | 4,933 | | | | | 3.70 | % | | | | — | |
Small Cap Growth Fund | | | | 7,268,482 | | | | | 48 | | | | | 36,279 | | | | | 3.74 | % | | | | — | |
Ultra Growth Fund | | | | 3,116,167 | | | | | 7 | | | | | 2,276 | | | | | 3.76 | % | | | | — | |
11. PRINCIPAL RISKS
Market and Credit Risk — In the normal course of business the Funds trade financial instruments and enter into financial transactions where risk of loss exists due to changes in the market (market risk) or the failure of the other party to a transaction to perform (credit risk). Similar to credit risk, the Funds may be exposed to counterparty risk, or the risk that an institution or other entity with which the Funds have unsettled or open transactions will default. The potential loss could exceed the value of the financial assets recorded in the financial statements. Financial assets, which potentially expose the Funds to credit risk, consist principally of cash due from counterparties and investments. The extent of the Funds’ exposure to credit and counterparty risks with respect to these financial assets approximates their carrying value as recorded in the Funds’ Statements of Assets and Liabilities.
Inflation Risk — Inflation risk is the possibility that inflation will reduce the purchasing power of a currency, and subsequently reduce the value of a security or asset, and may result in rising interest rates. Inflation is the overall upward price movement of goods and services in an economy that causes the value of a currency to decline.
Interest Rate Risk — Interest rate risk is the risk that fixed-income securities will decline in value because of changes in interest rates. A rise in interest rates typically causes a fall in values. Interest rate risk should be modest for shorter-term securities, moderate for intermediate-term securities and high for longer-term securities. Generally, an increase in the average maturity of a fund will make it more sensitive to interest rate risk. The interest rate is the amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets.
Foreign Currency Risk — If a fund invests directly in foreign currencies or in securities that trade in, and receive revenues in, foreign currencies, or in derivatives that provide exposure to foreign currencies, it will be subject to the risk that those currencies will decline in value relative to the U.S. dollar. This also includes the risk associated with higher transaction costs, delayed settlements, currency controls and adverse economic developments related to foreign investments.
Region Risk — The Funds, except the U.S. Treasury Fund, invest in equity and fixed-income securities ofnon-U.S. issuers. Because certain foreign markets are illiquid, market prices may not necessarily represent realizable value. Although the Funds maintain diversified investment portfolios, political or economic developments within a particular country or region may have an adverse effect on the ability of domiciled issuers to meet their obligations. These risks are exaggerated for securities of issuers tied economically to emerging and
frontier market countries. Additionally, political or economic developments may have an adverse effect on the liquidity and volatility of portfolio securities and currency holdings. For example, after the date of this report, there has been significant political upheaval in Zimbabwe, and as a result the Pricing Committee has applied a discount to the Zimbabwe assets held by the Frontier Emerging Small Countries Fund. This discount is included in the change in unrealized gain/(loss).
India Region Risk — The securities markets in the India region (India, Bangladesh, Pakistan and Sri Lanka) are substantially smaller, less liquid and more volatile than the major securities markets in the United States and the securities industries in these countries are comparatively underdeveloped. Financial intermediaries may not perform as well as their counterparts in the United States or in other countries with more developed securities markets. In some cases, physical delivery of securities in small lots has been required in India and shortages of vault capacity and trained personnel have existed among qualified custodial Indian banks. A fund may be unable to sell securities when the registration process is incomplete and may experience delays in receipt of dividends. If trading volume is limited by operational difficulties, the ability of the fund to invest may be impaired and the fund’s ability to buy or sell Indian securities may be impaired if the fund’s ability to transact is denied, delayed, suspended or not renewed by local regulators. In recent years, exchange-listed companies in the information technology sector and related industries (such as software) have grown so as to represent a significant portion of the total capitalization of the Indian market. The value of these companies will generally fluctuate in response to technological and regulatory developments. In addition, governmental actions can have a significant effect on economic conditions in the India region, which could adversely affect the value and liquidity of investments. Although the governments of India, Bangladesh, Pakistan and Sri Lanka have recently begun to institute economic reform policies, there can be no assurance that they will continue to pursue such policies or, if they do, that such policies will succeed. The region is an uncertain tax environment and it is difficult to know and predict the potential implications of future tax developments. Religious, cultural and military disputes persist in India, and between India and Pakistan (as well as sectarian groups within each country). The longstanding border dispute with Pakistan remains unresolved. In recent years, terrorists believed to be based in Pakistan struck Mumbai (India’s financial capital), further damaging relations between the two countries. If the Indian government is unable to control the violence and disruption associated
99
Notes to Financial Statements (continued)
with these tensions (including both domestic and external sources of terrorism), the result may be military conflict, which could destabilize the economy of India. Both India and Pakistan have tested nuclear arms, and the threat of deployment of such weapons could hinder development of the Indian economy, and escalating tensions could impact the broader region, including China.
Liquidity Risk — The trading market for a particular security may be less liquid than it appears and market prices may not represent realizable value. This may be likely when a fund has a proportionately large investment in securities with small market capitalizations or securities in foreign markets that trade infrequently. Reduced liquidity will have an adverse impact on a fund’s ability to sell such securities quickly at the currently marked price if necessary to meet redemptions.
Shareholder Concentration Risk — A significant portion of the net assets of the Frontier Emerging Small Countries Fund is owned by a group of shareholders advised by a common investment advisor. The Emerging Markets Select Fund also has a significant portion of net assets concentrated in relatively few related accounts. In the event of significant redemption activity by these shareholders, the Funds could experience a loss when selling portfolio securities to meet such redemption requests. The Funds could be forced to sell portfolio securities at unfavorable prices in an effort to generate sufficient cash to pay redeeming shareholders. Fund expenses may increase and performance may be materially affected.
12. FAIR VALUE MEASUREMENTSAND INVESTMENTS
The fair value of a financial instrument is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Funds use various methods to measure the fair value of their investments on a recurring basis. U.S. GAAP established a hierarchy that prioritizes inputs to valuation methods. The three levels of inputs are:
| | • | | Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities that the Funds have 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. The inputs may include quoted prices for the identical investment on an inactive market, prices for similar investments, 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 the Funds’ own assumptions about the assumptions a market participant would use in valuing the asset or 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, for example, the type of security, whether a security is new and not yet established in the marketplace, the liquidity of 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.
Equity Securities (common and preferred stock) — Securities are valued as of the close of the New York Stock Exchange (“NYSE”) (generally 4:00 p.m. Eastern Time) on the valuation date. Equity securities and listed warrants are valued using a commercial pricing service at the last quoted sales price taken from the primary market in which each security trades and, with respect to equity securities traded on the National Association of Securities Dealer Automated Quotation (“NASDAQ”) system, such securities are valued using the NASDAQ Official Closing Price (“NOCP”) or last sales price if no NOCP is available. If there are no sales on the primary exchange or market on a day, then the security shall be valued at the mean of the last bid and ask price on the primary exchange or market as provided by a pricing service. If the mean cannot be calculated or there is no trade activity on a day, then the security shall be valued at the previous trading day’s price as provided by a pricing service. Insome instances, particularly on foreign exchanges, an official close or evaluated price may be used if the pricing service is unable to provide the last trade or most recent mean price. To the extent that these securities are actively traded and valuation adjustments are not applied, they are categorized in Level 1 of the fair value hierarchy. Additionally, a fund’s investments are valued at fair value by the Pricing Committee if the Advisor determines that an event impacting the value of an investment occurred between the closing time of a security’s primary market or exchange (for example, a foreign exchange or market) and the time the fund’s share price is calculated. Significant events include, but are not limited to the following: significant fluctuations in domestic markets, foreign markets or foreign currencies; occurrences not directly tied to the securities markets such as natural disasters, armed conflicts or significant governmental actions; and major announcements affecting a single issuer or an entire market or market sector. In responding to a significant event, the Pricing Committee determines the fair value of affected securities by considering factors including, but not limited to: index options and futures traded subsequent to the close; American Depositary Receipts (“ADRs”), Global Depositary Receipts (“GDRs”) or other related receipts; currency spot or forward markets that trade after pricing of the foreign exchange; other derivative securities traded after the close such as Standard & Poor’s Depositary Receipts (“SPDRs”) and other exchange-traded funds (“ETFs”); and alternative market quotes on the affected securities. When applicable, the Funds use a systematic fair valuation model provided by an independent third party to assist in adjusting the valuation of foreign securities. When a Fund uses this fair value pricing method, the values assigned to the Fund’s foreign securities may not be the quoted or published prices of the investments on their primary markets or exchanges, and the securities are categorized in Level 2 of the fair value hierarchy. These valuation procedures apply equally to long or short equity positions in a fund.
100
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
Participation Notes — Investments are valued at the market price of the underlying security. Counterparty risk is regularly reviewed and considered for valuation. To the extent the inputs are observable and timely, the values would be categorized in Level 2 of the fair value hierarchy.
Corporate Debt Securities — Investments are valued at current market value by a pricing service, or by using the last sale or bid price based on observable inputs. Observable inputs may include benchmark yields, reported trades, broker/dealer quotes, issuer spreads,two-sided markets, benchmark securities, bids, offers and reference data including market research publications. Although most corporate bonds are categorized in Level 2 of the fair value hierarchy, in instances where observable inputs are not available, they are categorized as Level 3.
Short-Term Notes — Investments maturing in 60 days or less at the time of purchase, are generally valued at amortized cost, unless it is determined that the amortized cost method would not represent fair value, in which case the securities aremarked-to-market. To the extent the inputs are observable and timely, the values would be categorized in Level 2 of the fair value hierarchy.
Asset-Backed Securities — Investments are priced using the closing bid as supplied by a pricing service based on observable inputs. Observable inputs may include benchmark yields, reported trades, broker/dealer quotes, issuer spreads,two-sided markets, benchmark securities, bids, offers and reference data including market research publications, new issue data, monthly payment information and collateral performance. Although most asset-backed securities are categorized in Level 2 of the fair value hierarchy, in instances where observable inputs are not available, they are categorized as Level 3.
U.S. Government Issuers — Investments are priced using the closing bid as supplied by a pricing service based on observable inputs. Observable inputs may include benchmark yields, reported trades, broker/dealer quotes, issuer spreads,two-sided markets, benchmark securities, bids, offers and reference data including market research publications. Although most U.S. government bonds are categorized in Level 2 of the fair value hierarchy, in instances where observable inputs are not available, they are categorized as Level 3.
Derivative Instruments — Listed derivatives that are actively traded are valued based on quoted prices from the exchange and categorized in Level 1 of the fair value hierarchy. Exchange-traded options are valued at the last sale price in the market where they are principally traded. If there are no sales on the primary exchange or market on a given day, then the option is valued at the mean of the last bid price and ask price on the primary exchange or market as provided by a pricing service. Forward foreign currency contracts are valued at the market rate provided by the pricing service and categorized as Level 2.
Restricted Securities — If market quotations are not readily available for the Funds’ investments in securities such as restricted securities, private placements, securities for which trading has been halted or other illiquid securities, these investments are valued at fair value in accordance with Board-approved Pricing Policies and Procedures by the Pricing Committee with oversight by the Board of Trustees. Fair value is defined as the price that would be received upon the sale of an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date under current market conditions. For each applicable investment that is fair valued, the Pricing Committee considers, to the extent applicable, various factors including, but not limited to, the financial condition of the company or limited partnership, operating results, prices paid infollow-on rounds, comparable companies in the public market, the nature and duration of the restrictions for holding the securities, a stated net asset value (NAV) for the partnership, if applicable, and other relevant factors. Depending on the relative significance of valuation inputs, these instruments may be classified in either Level 2 or Level 3 of the fair value hierarchy.
When the last day of the reporting period is a non-business day, certain foreign markets may be open on days the NYSE is closed, which could result in differences between the value of a fund’s portfolio securities on the last business day and the last calendar day of the reporting period. Any significant security valuation changes due to an open foreign market are adjusted and reflected by the fund for financial reporting purposes.
The following is a summary of the fair valuations according to the inputs used as of March 31, 2019 in valuing the Funds’ assets and liabilities:
| | | | | | | | | | | | | | | | | | | | | | |
| Fund | | Category | | Quoted Prices
in Active Markets
for Identical
Investments
(Level 1) | | Significant Other
Observable Inputs
(Level 2) | | Significant
Unobservable
Inputs
(Level 3) | | Value at
3/31/2019 |
Core Growth Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | $ | 2,136,939,401 | | | | $ | — | | | | $ | — | | | | $ | 2,136,939,401 | |
Short-Term Investments | | | | | | — | | | | | 27,396,297 | | | | | — | | | | | 27,396,297 | |
| | | | | | | |
| | | | | $ | 2,136,939,401 | | | | $ | 27,396,297 | | | | $ | — | | | | $ | 2,164,335,698 | |
| | | | | | | |
101
Notes to Financial Statements (continued)
| | | | | | | | | | | | | | | | | | | | | | |
| Fund | | Category | | Quoted Prices
in Active Markets
for Identical
Investments
(Level 1) | | Significant Other
Observable Inputs
(Level 2) | | Significant
Unobservable
Inputs
(Level 3) | | Value at
3/31/2019 |
Emerging India Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | $ | 268,444,965 | | | | $ | — | | | | $ | — | | | | $ | 268,444,965 | |
Short-Term Investments | | | | | | — | | | | | 2,624,967 | | | | | — | | | | | 2,624,967 | |
| | | | | | | |
| | | | | $ | 268,444,965 | | | | $ | 2,624,967 | | | | $ | — | | | | $ | 271,069,932 | |
| | | | | | | |
Emerging Markets Select Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | $ | 44,040,095 | | | | $ | — | | | | $ | — | | | | $ | 44,040,095 | |
Preferred Stocks | | | | | | 1,265,112 | | | | | — | | | | | — | | | | | 1,265,112 | |
Short-Term Investments | | | | | | — | | | | | 811,475 | | | | | — | | | | | 811,475 | |
| | | | | | | |
| | | | | $ | 45,305,207 | | | | $ | 811,475 | | | | $ | — | | | | $ | 46,116,682 | |
| | | | | | | |
Emerging Markets Small Cap Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | | | | | | | | | | | | | | | | | | |
| | Commodity Chemicals | | | $ | 8,381,754 | | | | $ | 5,003,097 | | | | $ | — | | | | $ | 13,384,851 | |
| | Consumer Finance | | | | 18,270,886 | | | | | 10,799,081 | | | | | — | | | | | 29,069,967 | |
| | Pharmaceuticals | | | | 3,258,004 | | | | | — | | | | | 16,582 | | | | | 3,274,586 | |
| | Other | | | | 385,346,726 | | | | | — | | | | | — | | | | | 385,346,726 | |
Preferred Stocks | | | | | | 6,840,602 | | | | | — | | | | | — | | | | | 6,840,602 | |
| | | | | | | |
| | | | | $ | 422,097,972 | | | | $ | 15,802,178 | | | | $ | 16,582 | | | | $ | 437,916,732 | |
| | | | | | | |
Frontier Emerging Small Countries Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | | | | | | | | | | | | | | | | | | |
| | Consumer Finance | | | $ | 4,674,072 | | | | $ | 2,661,227 | | | | $ | — | | | | $ | 7,335,299 | |
| | Diversified Banks | | | | 11,141,717 | | | | | 2,465,276 | | | | | — | | | | | 13,606,993 | |
| | Food Retail | | | | 2,212,445 | | | | | 1,728,425 | | | | | — | | | | | 3,940,870 | |
| | Real Estate Operating Companies | | | | 655,824 | | | | | 2,308,639 | | | | | — | | | | | 2,964,463 | |
| | Other | | | | 28,807,584 | | | | | 3,863,166 | | | | | — | | | | | 32,670,750 | |
Preferred Stocks | | | | | | 1,995,191 | | | | | — | | | | | — | | | | | 1,995,191 | |
Short-Term Investments | | | | | | — | | | | | 917,970 | | | | | — | | | | | 917,970 | |
Other Assets less Liabilities | | | | | | (599,533 | ) | | | | — | | | | | 816,982 | | | | | 217,449 | |
| | | | | | | |
| | | | | $ | 48,887,300 | | | | $ | 13,944,703 | | | | $ | 816,982 | | | | $ | 63,648,985 | |
| | | | | | | |
Global Opportunities Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | | | | | | | | | | | | | | | | | | |
| | Consumer Finance | | | $ | 4,666,133 | | | | $ | 1,191,387 | | | | $ | — | | | | $ | 5,857,520 | |
| | Other | | | | 108,219,686 | | | | | — | | | | | — | | | | | 108,219,686 | |
Short-Term Investments | | | | | | — | | | | | 2,196,646 | | | | | — | | | | | 2,196,646 | |
| | | | | | | |
| | | | | $ | 112,885,819 | | | | $ | 3,388,033 | | | | $ | — | | | | $ | 116,273,852 | |
| | | | | | | |
Global Value Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | | | | | | | | | | | | | | | | | | |
| | Commodity Chemicals | | | $ | — | | | | $ | 1,949,582 | | | | $ | — | | | | $ | 1,949,582 | |
| | Other | | | | 165,177,402 | | | | | — | | | | | — | | | | | 165,177,402 | |
Short-Term Investments | | | | | | — | | | | | 3,535,378 | | | | | — | | | | | 3,535,378 | |
| | | | | | | |
| | | | | $ | 165,177,402 | | | | $ | 5,484,960 | | | | $ | — | | | | $ | 170,662,362 | |
| | | | | | | |
International Growth Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | | | | | | | | | | | | | | | | | | |
| | Commodity Chemicals | | | $ | 15,307,439 | | | | $ | 9,018,304 | | | | $ | — | | | | $ | 24,325,743 | |
| | Other | | | | 1,209,189,164 | | | | | — | | | | | — | | | | | 1,209,189,164 | |
Short-Term Investments | | | | | | — | | | | | 40,838,984 | | | | | — | | | | | 40,838,984 | |
| | | | | | | |
| | | | | $ | 1,224,496,603 | | | | $ | 49,857,288 | | | | $ | — | | | | $ | 1,274,353,891 | |
| | | | | | | |
102
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | |
| Fund | | Category | | Quoted Prices
in Active Markets
for Identical
Investments
(Level 1) | | Significant Other
Observable Inputs
(Level 2) | | Significant
Unobservable
Inputs
(Level 3) | | Value at
3/31/2019 |
International Opportunities Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | | | | | | | | | | | | | | | | | | |
| | Application Software | | | $ | 42,028,533 | | | | $ | 4,524,386 | | | | $ | — | | | | $ | 46,552,919 | |
| | Food Retail | | | | 14,192,772 | | | | | 3,567,758 | | | | | — | | | | | 17,760,530 | |
| | Other | | | | 326,369,920 | | | | | 4,060,576 | | | | | 8,206 | | | | | 330,438,702 | |
Short-Term Investments | | | | | | — | | | | | 18,950,264 | | | | | — | | | | | 18,950,264 | |
| | | | | | | |
| | | | | $ | 382,591,225 | | | | $ | 31,102,984 | | | | $ | 8,206 | | | | $ | 413,702,415 | |
| | | | | | | |
Micro Cap Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | | | | | | | | | | | | | | | | | | |
| | Other | | | $ | 436,087,311 | | | | $ | — | | | | $ | 8,740,410 | | | | $ | 444,827,721 | |
Short-Term Investments | | | | | | — | | | | | 4,054,338 | | | | | — | | | | | 4,054,338 | |
| | | | | | | |
| | | | | $ | 436,087,311 | | | | $ | 4,054,338 | | | | $ | 8,740,410 | | | | $ | 448,882,059 | |
| | | | | | | |
Micro Cap Value Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | $ | 235,477,740 | | | | $ | 2,410,364 | | | | $ | 597,780 | | | | $ | 238,485,884 | |
Convertible Preferred Stocks | | | | | | — | | | | | — | | | | | 1,898,802 | | | | | 1,898,802 | |
Rights | | | | | | — | | | | | — | | | | | 391,628 | | | | | 391,628 | |
Limited Liability Company Membership Interest | | | | | | — | | | | | — | | | | | 20,211 | | | | | 20,211 | |
Warrants | | | | | | — | | | | | — | | | | | 22,500 | | | | | 22,500 | |
Short-Term Investments | | | | | | — | | | | | 10,052,067 | | | | | — | | | | | 10,052,067 | |
| | | | | | | |
| | | | | $ | 235,477,740 | | | | $ | 12,462,431 | | | | $ | 2,930,921 | | | | $ | 250,871,092 | |
| | | | | | | |
Small Cap Growth Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | $ | 1,644,582,509 | | | | $ | — | | | | $ | — | | | | $ | 1,644,582,509 | |
Preferred Stocks | | | | | | — | | | | | — | | | | | 22,182,663 | | | | | 22,182,663 | |
Seller’s Note | | | | | | — | | | | | — | | | | | 1,728,000 | | | | | 1,728,000 | |
Limited Partnership Interest1 | | | | | | — | | | | | — | | | | | — | | | | | 2,552,412 | |
Short-Term Investments | | | | | | — | | | | | 6,841,818 | | | | | — | | | | | 6,841,818 | |
| | | | | | | |
| | | | | $ | 1,644,582,509 | | | | $ | 6,841,818 | | | | $ | 23,910,663 | | | | $ | 1,677,887,402 | |
| | | | | | | |
Small Cap Value Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | $ | 495,346,062 | | | | $ | — | | | | $ | — | | | | $ | 495,346,062 | |
Short-Term Investments | | | | | | — | | | | | 10,112,910 | | | | | — | | | | | 10,112,910 | |
| | | | | | | |
| | | | | $ | 495,346,062 | | | | $ | 10,112,910 | | | | $ | — | | | | $ | 505,458,972 | |
| | | | | | | |
Ultra Growth Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | | | $ | 448,232,769 | | | | $ | — | | | | $ | 1,286,580 | | | | $ | 449,519,349 | |
Preferred Stocks | | | | | | — | | | | | — | | | | | 2,411,612 | | | | | 2,411,612 | |
Seller’s Note | | | | | | — | | | | | — | | | | | 132,000 | | | | | 132,000 | |
Limited Partnership Interest1 | | | | | | — | | | | | — | | | | | — | | | | | 2,388,873 | |
Short-Term Investments | | | | | | — | | | | | 48,318,364 | | | | | — | | | | | 48,318,364 | |
| | | | | | | |
| | | | | $ | 448,232,769 | | | | $ | 48,318,364 | | | | $ | 3,830,192 | | | | $ | 502,770,198 | |
| | | | | | | |
U.S. Treasury Fund | | | | | | | | | | | | | | | | | | | | | | |
Assets | | | | | | | | | | | | | | | | | | | | | | |
U.S. Government Obligations | | | | | $ | — | | | | $ | 327,065,492 | | | | $ | — | | | | $ | 327,065,492 | |
Short-Term Investments | | | | | | — | | | | | 940,990 | | | | | — | | | | | 940,990 | |
| | | | | | | |
| | | | | $ | — | | | | $ | 328,006,482 | | | | $ | — | | | | $ | 328,006,482 | |
| | | | | | | |
| 1 | Certain investments measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value levels. The fair value amounts presented in the table are intended to permit reconciliation to the amounts presented in the Schedule of Investments. |
103
Notes to Financial Statements (continued)
| | | | | | | | | | | | | | | | | | | | |
| Fund | | Fair Value
at 3/31/2019 | | Unfunded
Commitments | | Redemption
Frequency (if currently
eligible) | | Redemption Notice Period |
Small Cap Growth Fund | | | | | | | | | | | | | | | | | | | | |
Limited Partnership Interests1 | | | $ | 2,552,412 | | | | $ | — | | | | | Never | | | | | N/A | |
Ultra Growth Fund | | | | | | | | | | | | | | | | | | | | |
Limited Partnership Interests1 | | | $ | 2,388,873 | | | | $ | — | | | | | Never | | | | | N/A | |
| 1 | The fair values of these limited partnership interests have been estimated using the net asset value of the Fund’s Limited Partner’s Capital Account. These limited partnership interests can never be redeemed. Distributions from each limited partnership will be received as the underlying investments are liquidated. It is estimated that the underlying assets of the limited partnerships will be liquidated over the next one to five years. |
If the securities of an Asset Class are all the same level, the asset class is shown in total. If the securities of an Asset Class cross levels, the level with the smallest number of categories and with multiple levels within a category is displayed by category. The remaining categories that do not cross levels are combined into the “Other” category.
The valuation techniques used by the Funds to measure fair value for the six months ended March 31, 2019 maximized the use of observable inputs and minimized the use of unobservable inputs.
The Funds’ policy is to recognize transfers between levels at the end of the reporting period. The table below shows the significant transfers between Level 1 and Level 2 due to fair valuation in certain foreign markets pursuant to a systematic valuation model.
There were transfers of $10,632,125 in the Core Growth Fund and $42,754,388 in the Small Cap Growth Fund from Level 3 to Level 1 due to a change in pricing strategy on a private company that came public. This transfer amount represents the beginning of the period value for DocuSign, Inc., which transferred to Level 1 during the period in order to properly represent the activity on the Level 3 Rollforward presented below.
There was a transfer of $2,628,758 in Emerging India Fund out of Level 3 to Level 1 due to a change in pricing strategy on a private company that came public. This transfer amount represents the beginning of the period value for Aavas Financiers Ltd., which transferred to Level 1 during the period in order to properly represent the activity on the Level 3 Rollforward presented below.
There was a transfer of $8,206 in the International Opportunities Fund from Level 1 to Level 3.
The following is a reconciliation of the fair valuations using significant unobservable inputs (Level 3) for the Funds during the six months ended March 31, 2019:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Fund | | Market
Value
Beginning
Balance
9/30/2018 | | Purchases
at Cost | | Sales
(Proceeds) | | Accrued
Discounts
(Premiums) | | Realized
Gain/
(Loss) | | Change in
Unrealized
Appreciation
(Depreciation) | | Transfers
in at
Market
Value | | Transfers
out at
Market
Value | | Market
Value
Ending
Balance
3/31/2019 | | Net Change
in Unrealized
Appreciation
(Depreciation)
on Investments
Held at
3/31/2019 |
Core Growth Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | $ | 10,632,125 | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | (10,632,125 | ) | | | $ | — | | | | $ | — | |
Preferred Stocks | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | |
| | | | | |
| | | $ | 10,632,125 | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | (10,632,125 | ) | | | $ | — | | | | $ | — | |
| | | | | |
Emerging India Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | $ | 2,628,758 | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | (2,628,758 | ) | | | $ | — | | | | $ | — | |
| | | | | |
| | | $ | 2,628,758 | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | (2,628,758 | ) | | | $ | — | | | | $ | — | |
| | | | | |
Emerging Markets
Small Cap Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | $ | 16,628 | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | (46 | ) | | | $ | — | | | | $ | — | | | | $ | 16,582 | | | | $ | (46 | ) |
| | | | | |
| | | $ | 16,628 | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | (46 | ) | | | $ | — | | | | $ | — | | | | $ | 16,582 | | | | $ | (46 | ) |
| | | | | |
Frontier Emerging Small Countries Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Other assets less liabilities | | | $ | 1,969,821 | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | (1,152,839 | ) | | | $ | — | | | | $ | — | | | | $ | 816,982 | | | | $ | (1,152,839 | ) |
| | | | | |
| | | $ | 1,969,821 | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | (1,152,839 | ) | | | $ | — | | | | $ | — | | | | $ | 816,982 | | | | $ | (1,152,839 | ) |
| | | | | |
International Opportunities Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | 8,206 | | | | $ | — | | | | $ | 8,206 | | | | $ | — | |
| | | | | |
| | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | 8,206 | | | | $ | — | | | | $ | 8,206 | | | | $ | — | |
| | | | | |
104
| | |
| | MARCH 31, 2019 (UNAUDITED) |
|
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Fund | | Market
Value
Beginning
Balance
9/30/2018 | | Purchases
at Cost | | Sales
(Proceeds) | | Accrued
Discounts
(Premiums) | | Realized
Gain/
(Loss) | | Change in
Unrealized
Appreciation
(Depreciation) | | Transfers
in at
Market
Value | | Transfers
out at
Market
Value | | Market
Value
Ending
Balance
3/31/2019 | | Net Change
in Unrealized
Appreciation
(Depreciation)
on Investments
Held at
3/31/2019 |
Micro Cap Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | $ | — | | | | $ | 2,500,000 | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | 3,490,415 | | | | $ | — | | | | $ | — | | | | $ | 5,990,415 | | | | $ | 3,490,415 | |
Preferred Stocks | | | | — | | | | | 2,749,995 | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | — | | | | | 2,749,995 | | | | | — | |
| | | | | |
| | | $ | — | | | | $ | 5,249,995 | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | 3,490,415 | | | | $ | — | | | | $ | — | | | | $ | 8,740,410 | | | | $ | 3,490,415 | |
| | | | | |
Micro Cap Value Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Convertible Preferred Stocks | | | $ | 1,855,059 | | | | $ | 56,073 | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | (12,330 | ) | | | $ | — | | | | $ | — | | | | $ | 1,898,802 | | | | $ | (12,330 | ) |
Rights | | | | 326,356 | | | | | — | | | | | — | | | | | — | | | | | — | | | | | 65,271 | | | | | — | | | | | — | | | | | 391,627 | | | | | 65,271 | |
Limited Liability Company Membership Interest | | | | 44,464 | | | | | 634,230 | | | | | — | | | | | — | | | | | — | | | | | (60,703 | ) | | | | — | | | | | — | | | | | 617,991 | | | | | (60,703 | ) |
Warrants | | | | 40,000 | | | | | — | | | | | — | | | | | — | | | | | — | | | | | (17,500 | ) | | | | — | | | | | — | | | | | 22,500 | | | | | (17,500 | ) |
| | | | | |
| | | $ | 2,265,879 | | | | $ | 690,303 | | | | $ | — | | | | | — | | | | | — | | | | $ | (25,262 | ) | | | $ | — | | | | $ | — | | | | $ | 2,930,920 | | | | $ | (25,262 | ) |
| | | | | |
Small Cap Growth Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | $ | 42,754,388 | | | | $ | — | | | | | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | — | | | | $ | (42,754,388 | ) | | | $ | — | | | | $ | — | |
Preferred Stocks | | | | 11,530,569 | | | | | 10,000,005 | | | | | — | | | | | — | | | | | — | | | | | 652,089 | | | | | — | | | | | — | | | | | 22,182,663 | | | | | 652,089 | |
Sellers Note | | | | 1,728,000 | | | | | — | | | | | — | | | | | 278,485 | | | | | — | | | | | (278,485 | ) | | | | — | | | | | — | | | | | 1,728,000 | | | | | (278,485 | ) |
| | | | | |
| | | $ | 56,012,957 | | | | $ | 10,000,005 | | | | | — | | | | $ | 278,485 | | | | $ | — | | | | $ | 373,604 | | | | $ | — | | | | $ | (42,754,388 | ) | | | $ | 23,910,663 | | | | $ | 373,604 | |
| | | | | |
Ultra Growth Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Common Stocks | | | $ | — | | | | $ | 1,365,030 | | | | | — | | | | $ | — | | | | $ | — | | | | $ | (78,450 | ) | | | $ | — | | | | $ | — | | | | $ | 1,286,580 | | | | $ | (78,450 | ) |
Preferred Stocks | | | | 87,758 | | | | | 2,250,000 | | | | | — | | | | | — | | | | | — | | | | | 73,854 | | | | | — | | | | | — | | | | | 2,411,612 | | | | | 73,854 | |
Sellers Note | | | | 132,000 | | | | | — | | | | | — | | | | | 21,356 | | | | | — | | | | | (21,356 | ) | | | | — | | | | | — | | | | | 132,000 | | | | | (21,356 | ) |
| | | | | |
| | | $ | 219,758 | | | | $ | 3,615,030 | | | | $ | — | | | | $ | 21,356 | | | | | — | | | | $ | (25,952 | ) | | | $ | — | | | | $ | — | | | | $ | 3,830,192 | | | | $ | (25,952 | ) |
| | | | | |
QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS
| | | | | | | | | | | | | | |
| Fund | | Description | | Fair Value
at 3/31/2019 | | | Valuation Technique | | Unobservable Input | | Range
(Average) | |
Frontier Emerging Small Countries Fund | | Other Assets Less Liabilities: Zimbabwe RTGS dollars | | $ | 816,982 | | | Discount for lack
of marketability of currency | | Discount for lack
of marketability of currency | | | 75% | |
Micro Cap Fund | | Direct Venture Capital Investments: Internet Software & Services | | $ | 5,990,415 | | | Financing round price | | Financing round price | | | 100% | |
Micro Cap Fund | | Direct Venture Capital Investments: Internet Software & Services | | $ | 2,749,995 | | | Cost | | Cost | | | 100% | |
Micro Cap Value Fund | | Convertible Preferred: Oil & Gas Refining & Marketing | | $ | 1,898,802 | | | Bond model with
call option | | Bond model with
call option | | | 100% | |
Micro Cap Value Fund | | PIPE Investment: Pharmaceuticals | | $ | 597,780 | | | Discount for lack
of marketability | | Discount for lack
of marketability | | | 10% | |
Micro Cap Value Fund | | Rights: Pharmaceuticals | | $ | 391,628 | | | Probability of receipt | | Probability of receipt | | | 30% | |
Small Cap Growth Fund | | Direct Venture Capital Investments: Biotechnology | | $ | 646,445 | | | Market comparable
companies | | EV/R* multiple
Discount for lack
of marketability | |
| 1.0 - 17.5 (4.7)
20% |
|
Small Cap Growth Fund | | Direct Venture Capital Investments: Internet Software & Services | | $ | 10,000,005 | | | Cost | | Cost | | | 100% | |
Small Cap Growth Fund | | Direct Venture Capital Investments: Systems Software | | $ | 11,536,213 | | | Market comparable
companies | | EV/R* multiple
Discount for lack
of marketability | |
| 2.4 - 26.0 (10.5)
20% |
|
Small Cap Growth Fund | | Seller’s Note: Oil & Gas Equipment & Services | | $ | 1,728,000 | | | Par | | Par | | | 100% | |
105
| | |
| WASATCH FUNDS | | MARCH 31, 2019 (UNAUDITED) |
|
|
|
Notes to Financial Statements (continued)
| | | | | | | | | | | | | | |
| Fund | | Description | | Fair Value
at 3/31/2019 | | | Valuation Technique | | Unobservable Input | | Range
(Average) | |
Ultra Growth Fund | | Direct Venture Capital Investments: Biotechnology | | $ | 161,612 | | | Market comparable
companies | | EV/R* multiple
Discount for lack
of marketability | |
| 1.0 - 17.5
(4.7)
20% |
|
Ultra Growth Fund | | Direct Venture Capital Investments: Internet Software & Services | | $ | 2,250,000 | | | Cost | | Cost | | | 100% | |
Ultra Growth Fund | | Unregistered common stock: Pharmaceuticals | | $ | 1,286,580 | | | Discount for lack
of marketability | | Discount for lack
of marketability | | | 10% | |
Ultra Growth Fund | | Seller’s Note: Oil & Gas Equipment & Services | | $ | 132,000 | | | Cost | | Cost | | | 100% | |
| * | Enterprise-Value-To-Revenue Multiple (“EV/R”) is a measure of the value of a stock that compares a company’s enterprise value to its revenue. |
Changes in EV/R multiples may change the fair value of an investment. Generally, a decrease in this multiple will result in a decrease in the fair value of an investment.
The Funds’ other Level 3 investments have been valued using observable inputs, unadjusted third-party transactions and quotations or unadjusted historical third party information. No unobservable inputs internally developed by the Funds have been applied to these investments, thus they have been excluded from the above table.
Other information regarding the Funds is available in the Funds’ most recent Prospectus and Report to Shareholders. This information is available on the Funds’ website atwww.WasatchFunds.com and on the Securities and Exchange Commission’s website atwww.sec.gov.
13. OFFSETTING
Each Fund is party to various netting arrangements. The Financial Accounting Standards Board (“FASB”) requires disclosure about certain netting arrangements and similar agreements to enable users of a Fund’s financial statements to evaluate the effect or potential effect of netting arrangements on the Fund’s financial position. The scope of the disclosure is limited to derivative instruments, repurchase agreements and reverse repurchase agreements, and securities borrowing and securities lending transactions.
The following tables present information about financial instruments that were subject to enforceable netting arrangements as of March 31, 2019:
REPURCHASE AGREEMENTS
| | | | | | | | | | | | | | | | | | | | | | |
| | | Gross Amounts Not Offset in the Statements of Assets and Liabilities |
| Fund | | Counterparty | | Gross Asset Amounts
Presented in Statements
of Assets and Liabilities | | Financial
Instrument | | Collateral
Received1 | | Net Amount
(not less
than 0) |
Core Growth Fund | | Fixed Income Clearing Corp. | | | $ | 27,396,297 | | | | $ | — | | | | $ | (27,396,297 | ) | | | $ | — | |
Emerging India Fund | | Fixed Income Clearing Corp. | | | | 2,624,967 | | | | | — | | | | | (2,624,967 | ) | | | | — | |
Emerging Markets Select Fund | | Fixed Income Clearing Corp. | | | | 811,475 | | | | | — | | | | | (811,475 | ) | | | | — | |
Frontier Emerging Small Countries Fund | | Fixed Income Clearing Corp. | | | | 917,970 | | | | | | | | | | (917,970 | ) | | | | | |
Global Opportunities Fund | | Fixed Income Clearing Corp. | | | | 2,196,646 | | | | | — | | | | | (2,196,646 | ) | | | | — | |
Global Value Fund | | Fixed Income Clearing Corp. | | | | 3,535,378 | | | | | — | | | | | (3,535,378 | ) | | | | — | |
International Growth Fund | | Fixed Income Clearing Corp. | | | | 40,838,984 | | | | | — | | | | | (40,838,984 | ) | | | | — | |
International Opportunities Fund | | Fixed Income Clearing Corp. | | | | 18,950,264 | | | | | — | | | | | (18,950,264 | ) | | | | — | |
Micro Cap Fund | | Fixed Income Clearing Corp. | | | | 4,054,338 | | | | | — | | | | | (4,054,338 | ) | | | | — | |
Micro Cap Value Fund | | Fixed Income Clearing Corp. | | | | 10,052,067 | | | | | — | | | | | (10,052,067 | ) | | | | — | |
Small Cap Growth Fund | | Fixed Income Clearing Corp. | | | | 6,841,818 | | | | | — | | | | | (6,841,818 | ) | | | | — | |
Small Cap Value Fund | | Fixed Income Clearing Corp. | | | | 10,112,910 | | | | | — | | | | | (10,112,910 | ) | | | | — | |
Ultra Growth Fund | | Fixed Income Clearing Corp. | | | | 48,318,364 | | | | | — | | | | | (48,318,364 | ) | | | | — | |
U.S. Treasury Fund | | Fixed Income Clearing Corp. | | | | 940,990 | | | | | — | | | | | (940,990 | ) | | | | — | |
| 1 | Repurchase agreements are classified as short-term investments in the Statements of Assets and Liabilities. The market value of the collateral received is greater than the amounts indicated in the table. For further information, see Note 3—Securities and Other Investments “Repurchase Agreements” and the Schedules of Investments. |
14. SUBSEQUENT EVENTS
Management has evaluated the possibility of subsequent events and has determined that there are no additional events that would require adjustment to or additional disclosure in the Funds’ financial statements.
106
| | |
| WASATCH FUNDS | | MARCH 31, 2019 |
|
|
|
Supplemental Information
MANAGEMENTOFTHE TRUST
Management Information. The business affairs of Wasatch Funds are overseen by its Board of Trustees. The Board consists of four Independent Trustees, all of whom were elected by shareholders to serve until their successors are qualified, appointed or elected in accordance with the Trust’s Declaration of Trust and By-Laws.
The Trustees and executive officers of Wasatch Funds and their principal occupations for at least the last five years are set forth below. The Advisor retains proprietary rights to the Trust name. The Funds’ Statement of Additional Information includes additional information about the Trustees and is available, without charge, online atwww.WasatchFunds.com or upon request by calling Wasatch Funds at800.551.1700.
| | | | | | | | | | | | |
Name, Address
and Age | | Position(s)
Held with
Wasatch Funds | | Term of Office1
and Length of
Time Served | | Principal Occupation(s)
during Past 5 Years | | Number of
Portfolios
in Fund
Complex
Overseen
by Trustee | | | Other Directorships
Held by Trustees
during Past 5 Years2 |
Independent Trustees | | | | | | | | | | | | |
| | | | | |
James U. Jensen, J.D., MBA 505 Wakara Way 3rd Floor Salt Lake City, UT 84108 Age 74 | | Trustee and Chairman of the Board | | Indefinite
Served as Chairman of the Board since 2004 and Trustee since
1986 | | Chief Executive Officer of Clearwater Law & Governance Group (an operating law firm board governance consulting company) April 2008 to present. Vice President, Corporate Development, Legal Affairs and General Counsel, and Secretary, NPS Pharmaceuticals, Inc. from 1991 to 2004. | | | 15 | | | Director and Board Chairman of Agricon Global Corporation (formerly known as Bayhill Capital Corporation (telephone communications) from December 2007 to February 2014. Trustee, Northern Lights Fund Trust III (33 portfolios) since 2012. |
| | | | | |
Miriam M. Allison 505 Wakara Way 3rd Floor Salt Lake City, UT 84108 Age 71 | | Trustee and Chairman of the Audit Committee | | Indefinite
Served as Trustee since
2010 | | Rancher since 2004. From 2001 to 2005, Chairman of UMB Fund Services, Inc. | | | 15 | | | Director, Northwestern Mutual Series Fund, Inc. (27 portfolios) since 2006. |
| | | | | |
Heikki Rinne, MBA, Ph.D. 505 Wakara Way 3rd Floor Salt Lake City, UT 84108 Age 66 | | Trustee | | Indefinite
Served as Trustee since October 2012 | | Chief Executive Officer of the Halton Group Ltd. (an indoor environmental control manufacturing and technology company) from 2002 to 2016. A Founder and Principal Owner of Sitoumus LLC (a training and consulting firm focusing on empowering organizational and individual engagement as well as general consulting) January 2017 to present. | | | 15 | | | Director, Halton Group Ltd. since 2016. |
| | | | | |
Kristen M. Fletcher 505 Wakara Way 3rd Floor Salt Lake City, UT 84108 Age 65 | | Trustee | | Indefinite
Served as Trustee since October 2014 | | Director, Youth Sports Alliance since 2015. Director, Utah Symphony/Utah Opera since 2005. Trustee, Woodlands Commercial Bank (a/k/a Lehman Brothers Commercial Bank) 2009 to 2012. Chairman and CEO, ABN AMRO, Inc. and U.S. Country Representative, ABN AMRO Bank, NV from 2002 to 2004. | | | 15 | | | Director, Youth Sports Alliance since 2015. Trustee, Woodlands Commercial Bank (a/k/a Lehman Brothers Commercial Bank) 2009–2012. Director Emeritus, Utah Symphony/Utah Opera since September 2017. Director, Utah Symphony/Utah Opera from 2005 to September 2017. |
|
|
| 1 | A Trustee may serve until his/her death, resignation, removal or retirement. Each Independent Trustee shall retire as Trustee at the end of the calendar year in which he/she attains the age of 75 years. The Board of Trustees reserves the right to permit continued service after the mandatory retirement age for any individual Trustee in its sole discretion. The Board has approved a one-year waiver of the mandatory retirement age for Mr. Jensen. |
| 2 | Directorships are those held by a Trustee in any company with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934 or subject to the requirements of Section 15(d) of the Securities Exchange Act or any company registered as an investment company under the 1940 Act. |
107
Supplemental Information(continued)
| | | | | | |
Name, Address
and Age | | Position(s)
Held with
Trust | | Term of Office and
Length of Time Served | | Principal Occupation(s)
during Past 5 Years |
Officers | | | | | | |
| | | |
Eric S. Bergeson 505 Wakara Way 3rd Floor Salt Lake City, UT 84108 Age 53 | | President | | Indefinite Served as President since May 2018 | | President for the Trust since May 2018. President of the Advisor since January 2017. Vice President of Institutional Sales for the Advisor since June 1998. |
| | | |
Russell L. Biles 505 Wakara Way 3rd Floor Salt Lake City, UT 84108 Age 51 | | Chief Compliance Officer, Vice President and Secretary | | Indefinite Served as Chief Compliance Officer and Vice President since February 2007 and Secretary since November 2008 | | Chief Compliance Officer and Vice President for Wasatch Funds since February 2007. Secretary for Wasatch Funds since November 2008. Counsel for the Advisor since October 2006. |
| | | |
Michael K. Yeates 505 Wakara Way 3rd Floor Salt Lake City, UT 84108 Age 37 | | Treasurer | | Indefinite Served as Treasurer since May 2018 | | Treasurer for Wasatch Funds since May 2018. Chief Financial Officer of the Advisor since September 2007. |
| | | |
David Corbett 505 Wakara Way 3rd Floor Salt Lake City, UT 84108 Age 46 | | Assistant
Vice President | | Indefinite Served as Assistant Vice President since August 2012 | | Assistant Vice President for Wasatch Funds since August 2012. Director of Mutual Fund Services for the Advisor since June 2007. |
| | | |
Cheryl Reich 505 Wakara Way 3rd Floor Salt Lake City, UT 84108 Age 35 | | Assistant Secretary | | Indefinite Served as Assistant Secretary since
February 2017 | | Assistant Secretary for Wasatch Funds since February 2017. Compliance Associate for the Advisor since September 2012. |
| | | |
Kara H. Becker 505 Wakara Way 3rd Floor Salt Lake City, UT 84108 Age 35 | | Assistant Treasurer | | Indefinite Served as Assistant Treasurer since May 2018 | | Assistant Treasurer for the Trust since May 2018. Controller for the Advisor since January 2012. |
|
|
ADDITIONAL TAX INFORMATION
The Funds hereby designate the following amounts or maximum amounts allowable as long term capital gain dividends for the purpose of the dividends paid deduction. The amounts designated here include the utilization of earnings and profits distributed to shareholders on the redemption of shares.
| | | | | |
| Fund | | Amount |
Core Growth Fund | | | $ | 99,220,332 | |
Emerging India Fund | | | | 4,591,525 | |
Global Opportunities Fund | | | | 10,899,209 | |
Global Value Fund | | | | 20,535,691 | |
International Growth Fund | | | | 41,285,234 | |
International Opportunities Fund | | | | 34,016,624 | |
Micro Cap Fund | | | | 44,480,704 | |
Micro Cap Value Fund | | | | 17,823,539 | |
Small Cap Growth Fund | | | | 177,876,579 | |
Small Cap Value Fund | | | | 23,502,378 | |
Ultra Growth Fund | | | | 11,827,106 | |
PROXY VOTING POLICIES, PROCEDURESAND RECORD
A description of the policies and procedures that Wasatch Advisors uses to vote proxies related to the Funds’ portfolio securities is set forth in the Funds’ Statement of Additional Information, which is available without charge, upon request, on the Funds’ website atwww.WasatchFunds.comor by calling800.551.1700and on the Securities and Exchange Commission’s (SEC) website atwww.sec.gov.
Wasatch Funds’ proxy voting record is available without charge on the Funds’ website atwww.WasatchFunds.comand on the SEC’s website atwww.sec.govno later than August 31 for the prior 12 months ending June 30.
QUARTERLY PORTFOLIO HOLDINGS DISCLOSUREON FORM N-Q
The Funds file their complete schedules of investments with the SEC for their first and third quarters of each fiscal year on Form N-Q. The Funds’ Form N-Q filings are available on the SEC’s website atwww.sec.gov, and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (information on the operation of the Public Reference room may be obtained by calling800.SEC.0330).
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BOARD CONSIDERATIONSFOR ADVISORYAND SUB-ADVISORY AGREEMENTSOFTHE WASATCH FUNDS
At a meeting held on November 6-7, 2018 (the “Meeting”), the Board of Trustees (the “Board”) of Wasatch Funds Trust (the “Trust”), including the disinterested Trustees (hereinafter, the “Independent Trustees”), unanimously approved the Advisory and Service Contract (the “Advisory Agreement”) between the Trust and Wasatch Advisors, Inc. (the “Advisor”) on behalf of each series of the Trust (each a “Fund”) and the sub-advisory agreement (the “Sub-Advisory Agreement”) between the Advisor and Hoisington Investment Management Company (“HIMCO” or the “Sub-Advisor”) on behalf of the Wasatch-Hoisington U.S. Treasury Fund (the “U.S. Treasury Fund”). The Advisory Agreement and Sub-Advisory Agreement are collectively the “Advisory Agreements.”
The Board, including the Independent Trustees, is responsible for overseeing the management of the Funds and as such, the Board determines each year as required by law whether to continue the Advisory Agreement with the Advisor on behalf of each Fund, and the Sub-Advisory Agreement with HIMCO on behalf of the U.S. Treasury Fund. In preparation for their review of the Advisory Agreements, the Independent Trustees requested through independent legal counsel and received extensive materials specifically prepared for the annual review of such agreements by the Advisor as well as certain materials provided by Broadridge Financial Solutions, Inc. (“Broadridge” or “Lipper”), an independent provider of investment company data. The materials covered a breadth of subject matters including, among other things, an overview of the organization; leadership structure and investment process of the Advisor, including its investment risk management process; the services performed pursuant to the Advisory Agreement; the experience of the relevant investment personnel; the performance of each Fund in absolute terms and as compared to the performance of peers compiled by Broadridge and benchmark(s); the brokerage policies and practices; the fees and expenses of each Fund and as compared to peers compiled by Broadridge; and the profitability of the Advisor. With respect to the Sub-Advisor, the materials also covered, among other things, an evaluation of the Sub-Advisor by the Advisor; the organizational and leadership structure of the Sub-Advisor; the services performed pursuant to the Sub-Advisory Agreement; the experience of the relevant investment personnel; the performance of the U.S. Treasury Fund in absolute terms and as compared to the performance of peers compiled by Broadridge and a benchmark; the fees and expenses of the U.S. Treasury Fund and as compared to peers compiled by Broadridge; and certain financial data regarding the Sub-Advisor. These materials supplement the materials that the Independent Trustees received and discussed throughout the year covering topics that are also pertinent to the annual review of Advisory Agreements, such as Fund performance, compliance, risk and liquidity management, brokerage allocation, distribution activity and trade execution. The Independent Trustees consider their review of Advisory Agreements to be an ongoing process that encompasses the information received, knowledge gained and discussions held during their Board and committee meetings held
throughout the year as well as while serving as Trustees. The Independent Trustees also received a memorandum from independent legal counsel outlining their fiduciary duties and legal standards in reviewing the Advisory Agreements.
In continuing their practice, the Independent Trustees met in executive session at a meeting held on October 23-24, 2018 (the “October Executive Session”) to consider and discuss the materials provided in connection with their review of the Advisory and Sub-Advisory Agreements. In their review, the Independent Trustees evaluated the advisory arrangements separately on a Fund-by-Fund and per class basis. The Independent Trustees invited members of management of the Advisor to attend the executive session from time to time to respond to questions and provide additional information. As a result of these discussions, as well as a result of the culmination of the Board’s year-round oversight of the Funds, the Independent Trustees presented the Advisor with additional questions and requests for additional information (through their independent counsel) and the Advisor provided written and oral responses to this request.
At this Meeting, the Independent Trustees met, including in executive session without management present, to further consider, in relevant part, the renewal of the Advisory and Sub-Advisory Agreements. The Independent Trustees had the benefit of independent legal counsel throughout the process. After their discussions and taking into account the information specifically provided for the evaluation of the Advisory Agreements, the information provided during the year, the accumulated knowledge and experience gained during their tenure as trustees, and the legal advice provided by legal counsel, the Independent Trustees approved the renewal of the Advisory Agreement and the Sub-Advisory Agreement. The Independent Trustees’ consideration of the contractual fee arrangements for the Funds were the result of several years of review and discussion between the Independent Trustees and Fund management, and the Independent Trustees’ conclusions may be based, in part, on their consideration of the fee arrangements and other factors developed in prior years. The Independent Trustees did not identify any single factor as all-important or controlling, but rather the decision reflected the comprehensive consideration of all the information presented, and each Trustee may have attributed different weights to the various factors and information considered in the approval process. The following summarizes the principal factors, but not all the factors, the Board considered in its review of the Advisory and Sub-Advisory Agreements and its conclusions.
A. NATURE, EXTENTAND QUALITYOF SERVICES
The Board, including the Independent Trustees, considered the nature, extent and quality of the Advisor’s and the Sub-Advisor’s services to the Funds and the resulting performance of each Fund, as described in further detail below. The Board considered the comprehensive set of management, oversight and administrative services the Advisor provides to manage and operate the Funds. The Independent Trustees recognized that the Advisor provides portfolio management services for the Funds (other than the U.S. Treasury Fund). In connection with providing these portfolio management services, the
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Board considered the Advisor’s investment approach and philosophy, its research capabilities, the experience and tenure of the portfolio managers and the research and trading teams. In considering its investment approach, the Board recognized that the Advisor followed a research-intensive approach in evaluating companies and considered information reflecting, among other things, the Advisor’s investment process, risk identification and management process, due diligence followed in assessing companies, the portfolio construction process and the Advisor’s sell discipline. The Independent Trustees also continue to seek to meet with the portfolio manager(s) of the various Funds during the year to discuss and keep updated on, among other things, the investment approach employed, any adjustments thereto, market conditions, risk management, liquidity and investment performance. As noted below, the Independent Trustees also reviewed Fund performance in considering the investment management performance of the Advisor or HIMCO, as applicable.
In addition to portfolio management services, the Board considered the quality of the administrative or non-advisory services the Advisor provides to manage and operate the Funds (in addition to those provided by other third-parties). The Advisor oversees the day-to-day operations of the Funds providing the officers and other personnel necessary for their operation and/or overseeing the service providers involved in the daily operations of the Funds. As illustrative, these services included, but are not limited to, service provider oversight services (such as coordinating and evaluating the services of the the various third-party service providers, including the Sub-Advisor, accountants, administrator, attorneys, custodian and transfer agent), Board support and administration (such as overseeing the organization of the Board and committee meetings and preparing or overseeing the timely preparation of various materials and/or presentations for such meetings), shareholder communications (such as overseeing the preparation of annual and semi-annual and other periodic shareholder reports); Fund regulatory and other administration services (such as overseeing the preparation of the Fund’s registration statements and other regulatory filings; overseeing the valuation of portfolio securities and daily pricing; reviewing and certifying the Funds’ financial statements; overseeing the Funds’ distributions; analyzing trade execution including monitoring and evaluating cross-trades [if any]; and overseeing and assisting with compliance with foreign registration requirements); and compliance services (such as helping to maintain and update the Funds’ compliance program and related policies and procedures as necessary or appropriate to meet new regulatory requirements; testing for compliance; providing compliance training for personnel; and evaluating the compliance programs of the Funds’ service providers). The Independent Trustees also considered the various material entrepreneurial, reputational and regulatory risks the Advisor incurs in managing the Funds in a highly regulated industry.
In helping to ensure the continuity of services, the Independent Trustees also assessed the stability, organizational structure, financial strength and resources of the Advisor. The Independent Trustees considered, among other things, information regarding the history and experience of the Advisor as an investment advisor; its leadership structure
(including committee structure); its compensation arrangements and whether they were sufficient to attract and retain qualified personnel and deter taking undue risks in portfolio management; its succession planning for key personnel; its risk identification and management process in seeking to address identified risks faced by the Advisor; its business continuity policies and procedures; and certain financial data of the Advisor, including its profitability.
With respect to the Sub-Advisor, the Independent Trustees considered the nature, extent and quality of services the Sub-Advisor provides to the U.S. Treasury Fund. The Independent Trustees recognized that the Sub-Advisor primarily provides portfolio management services for the U.S. Treasury Fund and was not expected to supply other significant administrative services. The Independent Trustees considered the background and experience of the investment personnel of the Sub-Advisor and the performance history of the U.S. Treasury Fund. The Independent Trustees also reviewed the Advisor’s evaluation of the Sub-Advisor and its performance. Similarly, in seeking to help ensure the continuity of the services of the Sub-Advisor, the Independent Trustees considered the stability, organizational structure, financial strength and resources of the Sub-Advisor. The Independent Trustees considered, among other things, the history and experience of the Sub-Advisor as a registered investment advisor; its leadership structure; its compensation arrangements; its disaster recovery plans and process; its compliance program, including its regulatory history; its process to assess enterprise risk; and certain financial data of the Sub-Advisor as described in further detail below. The Board noted that the Advisor recommended the renewal of the Sub-Advisory Agreement.
Based on their review, the Independent Trustees found that, overall, the nature, extent and quality of services provided under the Advisory Agreement and the Sub-Advisory Agreement were satisfactory on behalf of each applicable Fund.
B. THE INVESTMENT PERFORMANCEOFTHE FUNDS
As part of its evaluation of services provided by the Advisor and the Sub-Advisor, the Board reviewed the performance history of each Fund. Prior to the October Executive Session, the Board received and reviewed a report (the “Broadridge Report”) prepared by Broadridge Financial Solutions, Inc. “Broadridge” an independent data provider, which generally provided a Fund’s performance data for the one-, two-, three-, four-, five-, and 10-year periods ended August 31, 2018 (or for the periods available for Funds that did not exist for part of the foregoing timeframe) on an absolute basis and as compared to the performance of unaffiliated funds with similar investment objectives or classifications (a “Broadridge Peer Universe”), to a more focused subset of peers (a “Broadridge Peer Group”) and a benchmark provided by Broadridge for the prescribed periods. The Board was provided with information describing the methodology Broadridge used to create the Broadridge Peer Group and Broadridge Peer Universe.
In addition to the Broadridge Report, the Independent Trustees also reviewed materials reflecting, among other things, the respective Fund’s historical performance for the quarter, one-, three-, five-, and 10-year periods ended
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September 30, 2018 (or for the periods available for Funds that did not exist for part of the foregoing time frame), and annual returns from 2000 through 2017 (or for the calendar years available for Funds that did not exist for part of the foregoing time frame) in absolute terms and as compared to the Fund’s respective benchmark(s) as described below.
The Board also considered information reflecting a Fund’s peer ranking in its respective Morningstar investment category and any Morningstar ratings on the Fund. The Independent Trustees further received analyst reports provided by an unaffiliated party for the following Funds: the Core Growth Fund, the International Opportunities Fund, the Small Cap Growth Fund, and the U.S. Treasury Fund. The Independent Trusts also reviewed the performance of the following Funds (the Core Growth Fund, the Emerging Markets Select Fund, the Emerging Markets Small Cap Fund, the Frontier Emerging Small Countries Fund, the Global Opportunities Fund, the International Growth Fund, the International Opportunities Fund, the Micro Cap Fund, the Micro Cap Value Fund, the Small Cap Growth Fund, the Small Cap Value Fund and the Ultra Growth Fund), compared to the performance of certain composites of separate accounts for the one-, three-, five- and 10-year periods ended September 30, 2018 (or for such shorter periods if a Fund or separate account composite did not exist for part of the foregoing timeframe). The performance data prepared for the review of the Advisory and Sub-Advisory Agreements supplements the performance data the Trustees received throughout the year as the Board regularly reviews and meets with portfolio manager(s) during the year to discuss, in relevant part, the performance of their respective Fund.
In evaluating performance, the Independent Trustees understand certain limitations of assessing performance data which may impact the weight given to particular performance data, including the following:
| • | | The performance data reflects a snapshot in time as of a particular period (in this case, the periods ended August 31, 2018 and September 30, 2018) and a different performance period could generate significantly different results; |
| • | | Long-term performance can be affected by even one period of significant underperformance or overperformance so that a single investment decision or theme has the ability to disproportionately affect long-term performance; |
| • | | The investment experience of a particular shareholder in the Funds will vary depending on the shareholder’s particular investment period and the Fund’s performance during that period and the class held (if multiple classes are offered in a Fund); |
| • | | Although the performance data included in the Broadridge Report was based on the performance of the Investor Class shares of the Funds, the Board recognized that certain Funds also offer an Institutional Class. The performance of another class of a Fund, however, should be substantially similar on a relative basis because the classes are invested in the same portfolio of securities and differences in performance between the classes could be principally attributed to the variation in the expenses of each class; and |
| • | | There may be difficulties in establishing appropriate peer groups and benchmarks for certain Funds. In this regard, |
| | the Independent Trustees considered that the Advisor and the Sub-Advisor are responsible for managing the respective Fund in accordance with its investment objective(s), investment parameters and guidelines and that peers and/or benchmarks may be following different objectives, investment parameters and guidelines and risk tolerance levels which will lead to differing performance results and may limit the value of the comparative performance data in assessing a particular Fund’s performance. The Independent Trustees have recognized some limitations with the Broadridge Peer Group for the Micro Cap Fund and Micro Cap Value Fund (collectively, the “Micro CapFunds”) as the respective Broadridge Peer Group generally focuses on companies with larger market capitalizations than those sought by the Micro Cap Funds. As a result, the Independent Trustees also reviewed the Micro Cap Funds’ performance compared to a custom no-load peer group provided by the Advisor for the one-, three-, five- and 10-year periods ended September 30, 2018. |
Based on their review of the performance data, the Independent Trustees determined the following:
Core Growth Fund
With respect to the Core Growth Fund, the Fund’s Investor Class outperformed the median of the Broadridge Peer Group for the one-, two-, three-, four-, five- and 10-year periods ended August 31, 2018. The Fund’s Investor Class and Institutional Class also outperformed the Russell 2000 Index and Russell 2000 Growth Index for the one-, three-, five- and 10-year periods ended September 30, 2018. The Board was satisfied with the Fund’s overall performance.
Emerging India Fund
With respect to the Emerging India Fund, the Fund’s Investor Class outperformed the median of its Broadridge Peer Group in the one-, two-, three-, four- and five-year periods ended August 31, 2018. The Fund’s Investor Class and Institutional Class also outperformed the MSCI India Investable Market Index for the one-, three- and five-year periods ended September 30, 2018. The Board considered that the Fund’s performance had been generally favorable.
Emerging Markets Select Fund
With respect to the Emerging Markets Select Fund, the Independent Trustees noted that although the Fund’s Investor Class slightly underperformed the median of the Broadridge Peer Group for the two-, three- and five-year periods, the class matched the median of the Broadridge Peer Group in the four-year period and outperformed the median of its Broadridge Peer Group in the one-year period ended August 31, 2018. Similarly, although the Fund’s Investor Class and Institutional Class underperformed the MSCI Emerging Markets Index over the three- and five-year periods ended September 30, 2018, each class outperformed such index for the one-year period ended September 30, 2018. Although the Fund’s performance relative to the benchmark over the longer periods was somewhat challenged, the Fund’s performance over the shorter one-year period had improved. The Board considered the Fund portfolio positions that underperformed
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those in the benchmark as well as the challenged performance of the emerging market asset class. The Board was satisfied with the explanation of the Fund’s performance and the improved performance over the one-year period, but would continue to monitor this Fund closely.
Emerging Markets Small Cap Fund
With respect to the Emerging Markets Small Cap Fund, the Independent Trustees noted that the Fund’s Investor Class provided positive absolute performance for the two-, three-, four-, five- and 10-year periods ended August 31, 2018, but the relative performance was somewhat challenged. In this regard, the Fund’s Investor Class underperformed the median of its Broadridge Peer Group for two-, three-, and five-year periods ended August 31, 2018. The Fund’s Investor Class, however, outperformed the median of its Broadridge Peer Group for the one-year period and matched the median for the Broadridge Peer Group for the four-year period ended August 31, 2018. In addition, although the Fund’s Investor Class and Institutional Class underperformed the MSCI Emerging Markets Small Cap Index and MSCI Emerging Markets Index for the one-, three- and five-year periods ended September 30, 2018, each class outperformed such indexes in the 10-year period ended September 30, 2018. The Board considered the Fund’s portfolio positions that detracted from Fund performance as well as the challenged performance of the emerging market asset class. In light of the foregoing, the Board would continue to monitor this Fund closely.
Frontier Emerging Small Countries Fund
With respect to the Frontier Emerging Small Countries Fund, the Independent Trustees noted that the Fund has experienced periods of challenged performance with the Investor Class underperforming the median of its Broadridge Peer Group for the one-, two-, three-, four- and five-year periods ended August 31, 2018. The Fund’s Investor Class and Institutional Class similarly underperformed the MSCI Frontier Emerging Markets Index and MSCI Frontier Markets Index for the one-, three- and five-year periods ended September 30, 2018. The Board considered, among other things, the portfolio positions that detracted from Fund performance and the challenged performance of the asset class. The Board also considered the steps management had taken to address performance issues, including the changes to portfolio managers of the Fund in 2016 and modifications to the investment approach of the Fund under the new management team. The Board would continue to monitor this Fund closely.
Global Opportunities Fund
With respect to the Global Opportunities Fund, the Independent Trustees noted that the Fund’s Investor Class outperformed the median of its Broadridge Peer Group for the one-, two-, three-, four- and five-year periods ended August 31, 2018. Similarly, the Fund’s Investor Class and Institutional Class outperformed its benchmark, the MSCI ACWI (All Country World) Small Cap Index, for the one-, three- and five-year periods ended September 30, 2018. The
Board determined that the Fund’s overall performance over time had been generally favorable.
Global Value Fund
With respect to the Global Value Fund (formerly, the Large Cap Value Fund), the Independent Trustees noted that although the Fund’s Investor Class underperformed the median of its Broadridge Peer Group for the 10-year period ended August 31, 2018, the Fund’s Investor Class outperformed or matched the median of its Broadridge Peer Group for the one-, two-, three-, four- and five-year periods ended August 31, 2018. The Fund’s Investor Class and Institutional Class, however, underperformed the MSCI ACWI (All Country World Index) and Russell 1000® Value Index for the one-, three-, five- and 10-year periods ended September 30, 2018. In reviewing the performance, the Independent Trustees recognized that the Board had approved a change in the principal investment strategies of the Fund to permit the Fund greater ability to invest in foreign securities becoming a global value fund effective October 31, 2017, and the performance prior to such effective date would not reflect the foregoing change. Although the Fund previously had experienced periods of challenged performance, the Board recognized the steps the Advisor has taken to address performance issues and was satisfied with the Fund’s improved performance.
International Growth Fund
With respect to the International Growth Fund, the Independent Trustees noted that although the Fund’s Investor Class underperformed the median of its Broadridge Peer Group in the five-year period ended August 31, 2018, the Class outperformed the median in the one-, two-, three-, four- and 10-year periods ended August 31, 2018. The Independent Trustees further noted that the Fund’s Investor Class and Institutional Class outperformed the benchmarks, the MSCI ACWI (All Country World Index) ex-USA Small Cap Index and MSCI World ex-USA Small Cap Index, for the one-, three-, five- and 10-year periods ended September 30, 2018. The Board recognized the improved performance of the Fund and determined that it was satisfied with the Fund’s overall performance.
International Opportunities Fund
With respect to the International Opportunities Fund, the Independent Trustees noted that the Fund’s Investor Class outperformed the median of its Broadridge Peer Group for the one-, two-, three-, four-, five- and 10-year periods ended August 31, 2018. Similarly, the Independent Trustees noted that the Fund’s Investor Class and Institutional Class outperformed its benchmarks the MSCI ACWI ex USA. Small Cap Index and MSCI World ex USA. Small Cap Index for the one-, three-, five- and 10-year periods ended September 30, 2018. The Board determined the Fund’s overall performance had been generally favorable.
Micro Cap Fund
With respect to the Micro Cap Fund, the Independent Trustees noted that the Fund’s Investor Class outperformed
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the median of its Broadridge Peer Group for the one-, two-, three- four-, five- and 10-year periods ended August 31, 2018. In addition, the Fund’s Investor Class outperformed its benchmark, the Russell Microcap® Index, for the one-, three-, five- and 10-year periods ended September 30, 2018. In considering the comparative data, the Independent Trustees recognized that the Broadridge Peer Group may not adequately reflect the investment strategies and investable universe of the Fund thereby limiting some of the value of the comparative data. Accordingly, the Independent Trustees also reviewed the Fund’s performance compared to a custom peer group provided by the Advisor for the one-, three-, five- and 10-year periods ended September 30, 2018. In considering the foregoing, the Board determined the Fund’s overall performance had been generally favorable.
Micro Cap Value Fund
With respect to the Micro Cap Value Fund, the Independent Trustees noted that the Fund’s Investor Class outperformed the median of its Broadridge Peer Group for the one-, two, three-, four-, five- and 10-year periods ended August 31, 2018. Similarly, the Fund’s Investor Class outperformed its benchmark, the Russell Microcap Index, for the one-, three-, five- and 10-year periods ended September 30, 2018. In considering the comparative data, as noted above with the Micro Cap Fund, the Independent Trustees recognized that the Broadridge Peer Group may not adequately reflect the investment strategies and investable universe of the Fund thereby limiting some of the usefulness of the comparative data. The Independent Trustees accordingly also reviewed the Fund’s performance compared to a custom peer group provided by the Advisor for the one-, three-, five- and 10-year periods ended September 30, 2018? In considering the foregoing, the Board determined that the Fund’s overall performance had been generally favorable.
Small Cap Growth Fund
With respect to the Small Cap Growth Fund, the Independent Trustees noted that although the Fund’s Investor Class underperformed the median of its Broadridge Peer Group for the five-year period ended August 31, 2018, the Class outperformed such median for the one-, two-, three-, four- and 10-year periods. In addition, although the Fund’s Investor Class and Institutional Class underperformed the Russell 2000 Growth Index for the five-year period, each class outperformed such index for the one-, three- and 10-year periods ended September 30, 2018. Similarly, the Fund’s Investor Class and Institutional Class outperformed the Russell 2000 Index for the one- three-, five- and 10-year periods ended September 30, 2018. The Board was satisfied with the Fund’s overall performance.
Small Cap Value Fund
With respect to the Small Cap Value Fund, the Independent Trustees noted that the Fund’s Investor Class outperformed the performance of the median of its Broadridge Peer Group for the one-, two-, three-, four-, five- and 10-year periods ended August 31, 2018. Except that the Investor Class shares of the Fund underperformed the Russell 2000
Value Index for the three-year period ended September 30, 2018, the Institutional Class outperformed such index in such period and the Fund’s Investor Class and Institutional Class each outperformed such index for the one-, five- and 10-year periods ended September 30, 2018. Similarly, although the Fund’s Investor Class and Institutional Class underperformed the Russell 2000 Index for the one- and three-year periods ended September 30, 2018, each class outperformed such index in the five- and 10-year periods ended September 30, 2018. The Board was satisfied with the Fund’s performance.
Ultra Growth Fund
With respect to the Ultra Growth Fund, the Independent Trustees noted that the Fund’s Investor Class outperformed the median of its Broadridge Peer Group for the one-, two-, three-, four-, five- and 10-year periods ended August 31, 2018. In addition, the Fund’s Investor Class outperformed the Russell 2000® Growth Index for the one-, three-, five- and 10-year periods ended September 30, 2018. In light of the foregoing, the Board was satisfied with the Fund’s overall performance.
U.S. Treasury Fund
With respect to the U.S. Treasury Fund, the Independent Trustees noted that although the Fund’s Investor Class underperformed the median of its Broadridge Peer Group for the one- and two-year periods ended August 31, 2018, the Fund outperformed the median of its Broadridge Peer Group for the three-, four-, five- and 10-year periods ended August 31, 2018. Similarly, although the Fund’s Investor Class underperformed its benchmark, the Bloomberg Barclays US Aggregate Bond Index, in the one- and three-year periods ended September 30, 2018, the Fund outperformed such index in the five- and 10-year periods ended September 30, 2018. The Board was satisfied with the Fund’s overall performance.
C. FEES, EXPENSESAND PROFITABILITY
In its annual review, the Board considered the fees paid to the Advisor and Sub-Advisor and the total operating expense ratio of each Fund before and after any expense cap undertaken by the Advisor to limit the respective Fund’s operating expenses to certain levels. More specifically, the Independent Trustees reviewed, among other things, the contractual management fee rate, the net management fee rate (i.e., the management fee after taking into account expense reimbursements and/or fee waivers, if any) and net total expense ratio of each class of the respective Fund in relation to those of a comparable universe of funds (the “Broadridge Expense Universe”) and to a more focused subset of comparable funds (the “Broadridge Expense Group”) established by Broadridge. The Board reviewed information regarding the methodology followed by Broadridge to develop the Broadridge Expense Universe and Broadridge Expense Group. The Board considered the net total expense ratio of each class of each Fund (expressed as a percentage of average net assets) as the expense ratio is more reflective of the investors’ net experience in a Fund as it directly reflects the costs of investing in a Fund.
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In reviewing the comparative data provided by Broadridge, the Board was aware of some of the limitations of such data that arise as a result of differences between the investment strategies of the Funds and the peers, particularly with respect to the Micro Cap Fund and Micro Cap Value Fund, and that the data may vary depending on the selection and composition of the peer group. In light of the foregoing, the Independent Trustees also reviewed comparisons of the Micro Cap Fund’s and Micro Cap Value Fund’s management fee and net expense ratio with those of a custom peer group provided by the Advisor.
Aside from the comparative data provided by Broadridge, the Independent Trustees also considered information regarding fees charged by the Advisor and Sub-Advisor to other types of clients, as described in further detail below.
In addition to the foregoing fee and expense data, the Board considered information regarding the various factors that the Advisor considers in proposing a management fee level for a respective Fund, including, among other things, the potential value of the service (such as the potential for the strategy to deliver alpha and the experience of the management team with the respective strategy), the competitive marketplace (such as the uniqueness of the Fund and the fees of competitor funds) and the economics to the Advisor (such as, the costs to provide the advisory services to the particular Fund and the existence of any capacity constraints of the Fund, which may reduce the potential for revenues to the Advisor). In this regard, the Board also noted the research-intensive approach followed by the Advisor and the related costs incurred of such approach, particularly for evaluating small- or micro-cap companies as well as foreign companies; the quality and experience of the portfolio managers; and the Advisor’s willingness to close capacity-constrained Funds when necessary to protect performance and forego potential revenues that could be derived from higher asset levels. The Board further considered the Advisor’s contractual commitment to limit certain operating expenses of each of the classes of various Funds to the benefit of shareholders and reviewed the amounts, if any, the Advisor had reimbursed to the applicable Fund for the last three fiscal years.
In considering the fees of the Sub-Advisor for the U.S. Treasury Fund, the Independent Trustees considered the fee rate paid to the Sub-Advisor with respect to such Fund in absolute terms and as compared to the Sub-Advisor’s pricing schedule for portfolio management services for other clients. The Independent Trustees also noted that the Sub-Advisor fee is an obligation of the Advisor from its own revenues and not of the Fund. Further, the Independent Trustees recognized that the Advisor and the Sub-Advisor are not affiliates and the sub-advisory fee was established through arm’s length negotiations between the Advisor and the Sub-Advisor.
In its evaluation of the advisory and sub-advisory fees of the Funds, the Board observed, among other things, the following:
With respect to the Core Growth Fund, the Independent Trustees recognized that although the contractual management fee rate for the Investor and Institutional Class shares was above the median of its respective Broadridge Expense Group, the Fund had a net expense ratio that was slightly higher (within 5 basis points) than the median of its Broadridge Expense Group
for the Investor Class shares and higher than the median of its Broadridge Expense Group for the Institutional Class shares. The Independent Trustees also noted, in part, the capacity constraints of this Fund, the experience and expertise of the Advisor with this strategy, the costs of the research-intensive approach, and the potential for the Fund to deliver alpha. Based on its review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the Emerging India Fund, although the Fund’s contractual management fee rate for the Investor Class and Institutional Class shares was higher than the median of its Broadridge Expense Group, its net expense ratio was the same as the median of its Broadridge Expense Group for the Investor Class shares and below the median for the Institutional Class shares. The Independent Trustees also noted, in part, the capacity constraints of this Fund, the uniqueness of the Fund in the marketplace, and the additional expenses associated with evaluating and investing in companies in India. Based on its review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the Emerging Markets Select Fund, the Independent Trustees noted that the Fund’s contractual management fee rate was slightly higher (within 5 basis points) than the median of its Broadridge Expense Group for the Investor Class shares and the Institutional Class shares and the net expense ratio for the Investor Class shares was higher than the median for the Broadridge Expense Group, but the net expense ratio for the Institutional Class was lower than the median. While the Independent Trustees recognized that the Fund had more capacity than other Funds, which are focused on small- and/or micro-cap securities, the Trustees also recognized the uniqueness of the Fund’s approach to the emerging markets segment. Based on its review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the Emerging Markets Small Cap Fund, the Independent Trustees noted that the Fund’s contractual management fee rate and net total expense ratio for the Investor Class shares and Institutional Class shares were above the median of its Broadridge Expense Group. The Independent Trustees also noted, in part, the capacity constraints of this Fund, the uniqueness of the Fund in the marketplace, and the additional expenses associated with evaluating and investing in companies dispersed among the various emerging market countries. Based on its review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the Frontier Emerging Small Countries Fund, the Independent Trustees noted that the contractual management fee rate and net expense ratio were above the median of its Broadridge Expense Group for the Investor and Institutional Class shares. The Trustees further recognized, however, that the management fee and expense cap on the classes of this Fund were reduced in 2017. The Independent Trustees also noted, in part, the capacity constraints
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of this Fund, the uniqueness of the Fund in the marketplace, and the additional expenses associated with evaluating and investing in companies dispersed among the various emerging market and frontier countries. Based on its review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the Global Opportunities Fund, the Independent Trustees noted that although the contractual management fee rate of the Fund was above the median of its Broadridge Expense Group for the Investor Class shares and the Institutional Class shares, the Fund’s net expense ratio was the same as the median of its Broadridge Expense Group for the Investor Class shares and below the median for the Institutional Class shares. In addition, the Independent Trustees noted, in part, the capacity constraints of this Fund. Based on its review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the Global Value Fund, the Independent Trustees noted that the contractual management fee rate was slightly higher (within 5 basis points) than the median of its Broadridge Expense Group for the Investor Class shares and Institutional Class shares, and the Fund’s net expense ratio was below the median of its Broadridge Expense Group for the Investor Class shares and Institutional Class shares. In addition, the Independent Trustees recognized that the Fund generally had no capacity constraints given its investment strategies. Based on its review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the International Growth Fund, the Independent Trustees noted that although the Fund’s contractual management fee rate for the Investor Class shares and Institutional Class shares was above the median of its Broadridge Expense Group, its net expense ratio was below the median of the Broadridge Expense Group for its Investor Class shares and Institutional Class shares. In addition, the Independent Trustees noted, in part, the capacity constraints of the Fund, the uniqueness of the strategy of the Fund, and the additional costs incurred in evaluating and investing in foreign companies. Based on its review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the International Opportunities Fund, the Independent Trustees noted that the Fund’s contractual management fee rate and net expense ratio were above the median of its Broadridge Expense Group for the Investor Class shares and Institutional Class shares. In addition, the Independent Trustees noted, in part, the capacity constraints of the Fund, the uniqueness of the strategy of the Fund, and the additional costs incurred in evaluating and investing in foreign companies. Based on its review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the Micro Cap Fund and the Micro Cap Value Fund, the Independent Trustees noted that each Fund’s contractual management fee rate and net expense ratio were above the
median of its Broadridge Expense Group. The Trustees, however, recognized that the management fees for these Funds were reduced in 2016. In addition, the Independent Trustees noted, in part, the capacity constraints of the Funds, the uniqueness of the Funds and their potential to deliver alpha, the Advisor’s experience in this asset category, and the costs associated with applying the Advisor’s research-intensive approach to the micro-cap asset class. Based on its review, the Board determined that the advisory fee for each of the foregoing Funds was acceptable in light of the nature, extent and quality of services provided.
With respect to the Small Cap Growth Fund, the Independent Trustees noted that the Fund’s contractual management fee rate was above the median of its Broadridge Expense Group for the Investor Class shares and Institutional Class shares and its net expense ratio was above the median of its Broadridge Expense Group for the Investor Class shares and slightly above (within 5 basis points) the median for the Institutional Class shares. In addition, the Trustees noted, in part, the capacity constraints of the Fund, the potential to deliver alpha, the expertise of the Advisor with the strategy and the costs associated with applying the Advisor’s research-intensive approach to the small-cap asset class. Based on its review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the Small Cap Value Fund, the Independent Trustees noted that the Fund’s contractual management fee rate was above the median of its Broadridge Expense Group for the Investor Class shares and Institutional Class shares, and the net expense ratio of the Investor Class shares was above the median of its Broadridge Expense Group but below the median for the Institutional Class shares. In addition, the Trustees noted, in part, the capacity constraints of the Fund, the potential to deliver alpha, the expertise of the Advisor with the strategy and the costs associated with applying the Advisor’s research-intensive approach to the small-cap asset class. Based on its review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the Ultra Growth Fund, the Independent Trustees noted that the Fund’s contractual management fee rate and net expense ratio for its Investor Class shares were slightly higher than (within 5 basis points) the respective median of the Broadridge Expense Group. In addition, the Independent Trustees noted, in part, the capacity constraints of the Fund, the Advisor’s expertise in the small-cap asset class and the costs associated with applying the Advisor’s research-intensive approach to the small-cap asset class. Based on its review, the Board determined the advisory fee for the Fund was acceptable in light of the nature, extent and quality of services provided.
With respect to the U.S. Treasury Fund, the Independent Trustees noted that the Fund’s contractual management fee matched the median of its Broadridge Expense Group, and the Fund’s net expense ratio was below the median of its Broadridge Expense Group for the Investor Class shares. In addition, the Independent Trustees recognized that the Fund did not have any capacity constraints. Based on its
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Supplemental Information(continued)
review, the Board determined that the advisory fee for the foregoing Fund was acceptable in light of the nature, extent and quality of services provided. In addition to the advisory fee of the U.S. Treasury Fund, the Board recognized that the Fund is sub-advised and separately considered the sub-advisory fee rate paid to the Sub-Advisor by the Advisor and as compared to the Sub-Advisor’s pricing schedule for portfolio management services to other clients. With respect to the U.S. Treasury Fund, the Independent Trustees noted that the sub-advisory fee rate was in line with the Sub-Advisor’s fee schedule in light of the asset size of the Fund. In addition, the Independent Trustees also recognized that the Advisor pays the Sub-Advisor from its own revenues and the sub-advisory fee to the Sub-Advisor was established through arm’s length negotiations between the Advisor and the Sub-Advisor, which is unaffiliated with the Advisor. Based on its review, the Board determined that the sub-advisory fee for the U.S. Treasury Fund was acceptable in light of the nature, extent and quality of services provided.
| 2. | Fees Charged to Other Advisor and Sub-Advisor Clients |
In their review of the appropriateness of fees, the Board also considered information regarding the nature of services and fee rates offered by the Advisor to other clients, including separate accounts, unified managed accounts, model accounts, collective investment trusts and certain domestic and foreign funds outside the Wasatch family of funds for which the Advisor serves as a sub-advisor. The Independent Trustees reviewed, among other things, information regarding the fee rates of certain separate accounts and if multiple separate accounts existed with varying fee rates, the range of fees and their weighted average of such accounts that are managed in a style similar to that of certain Funds. Such Funds included the Core Growth Fund, Emerging Markets Select Fund, Emerging Markets Small Cap Fund, Frontier Emerging Small Countries Fund, Global Opportunities Fund, Global Value Fund, International Growth Fund, Micro Cap Fund, Micro Cap Value Fund, Small Cap Growth Fund, Small Cap Value Fund and Ultra Growth Fund.
The Independent Trustees noted that the fee rates or weighted average fee rates for separate accounts and other types of clients were generally lower than the fees for the comparable Fund, subject to certain exceptions. The Independent Trustees considered the rationale the Advisor provided for the variations in fee rates between the Funds and other types of clients including, in particular, the material differences in the services provided to the Funds compared to other types of clients, the extensive regulatory requirements associated with operating registered investment companies, and the differences in the investment parameters and strategies between the investment companies and other clients. The Independent Trustees noted that although the Advisor may provide portfolio management services to separate accounts similar to those for the Funds, the services may still be quite different given the varying investment parameters. The Independent Trustees noted that, in general, the Advisor assessed higher fees to clients requiring a higher degree of service. The Independent Trustees acknowledged that the additional services provided to support the Funds included, among other things, fund
administrative services and operations, shareholder communications, oversight of third party service providers, oversight of shareholder servicing, Board support, tax administration and compliance, and that such services were not required to the same extent or at all for other types of clients. The Independent Trustees further acknowledged the entrepreneurial, reputational and regulatory risk the Advisor incurs in managing the Funds. The Board determined that the varying levels of fees were justified given, among other things, the inherent differences in the products and level of services provided to the Funds versus other clients and the entrepreneurial and other risks incurred in sponsoring and advising the Funds.
In addition, with respect to the Sub-Advisory fees for the Sub-Advisor of the U.S. Treasury Fund, the Independent Trustees, as noted above, had reviewed the sub-advisory fee rate paid to the Sub-Advisor compared to the Sub-Advisor’s pricing schedule for portfolio management services for other clients, including the fee rate for a separate account with a similar size as the Fund. The Independent Trustees had noted that the fee rate paid to the Sub-Advisor for its sub-advisory services was reasonable in comparison to its respective pricing schedule. The Trustees further noted that the Sub-Advisor was unaffiliated with the Advisor and therefore the respective sub-advisory fee was the result of arms-length negotiations. As noted, the Board considered the sub-advisory fee to be acceptable in light of the nature, extent and quality of services provided.
| 3. | Profitability of the Advisor |
In conjunction with their review of fees, the Independent Trustees reviewed information reflecting the Advisor’s financial condition. The Independent Trustees reviewed the consolidated financial statements of WA Holdings, Inc. (the parent of the Advisor) and its subsidiary (the Advisor) for the years ended December 31, 2017 and 2016.
The Independent Trustees also reviewed the profitability information for the Advisor derived from its relationship with each Fund for the calendar year ended December 31, 2017 on an actual and adjusted basis. The Independent Trustees evaluated, among other things, the Advisor’s revenues, expenses and net income (pre-tax and after-tax) and the net profit margins (pre-tax and after-tax). The Independent Trustees also reviewed the level of profitability realized by the Advisor including and excluding distribution expenses incurred by the Advisor from its own resources.
In its evaluation of profitability, the Independent Trustees reviewed the Advisor’s methodology used to allocate revenue and expenses for the purposes of calculating profitability per Fund. However, the Independent Trustees recognized the difficulty in calculating profitability at the individual Fund level given that the use of different but reasonable expense allocation methodologies may lead to significantly different results. Further, the Independent Trustees recognized that employee compensation was the primary expense for the Advisor and as a privately held S corporation owned by employees, the Advisor’s level of profitability could be influenced, in part, by paying employees through compensation expense as opposed to dividends as shareholders. As a result, the Independent Trustees also reviewed the Advisor’s profitability data for 2017 with
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certain adjustments to the compensation expense to assist in the comparability of the Advisor’s profitability to certain industry peers. In this regard, the Independent Trustees received and reviewed comparative profitability data which included, among other things, the revenues, expenses and profit margin (pre-tax) of certain other public advisory firms in the industry which the Advisor considers resemble its business model. The Trustees, however, noted the difficulty in comparing the profitability of various investment advisors given the limited public information available and the subjective nature of calculating profitability which can be affected by numerous factors, including variations in fee waivers and expense reimbursements by the advisor, the types of funds managed, other lines of business, the cost allocation methodology, and the capital structure. Based on the information presented and recognizing the above limitations, the Independent Trustees noted that the Advisor’s profitability (with and without the compensation adjustment) appeared reasonable when compared to the peer group of unaffiliated advisors. In addition to the comparative data, the Independent Trustees also considered in assessing profitability any indirect benefits (such as soft dollars) that the Advisor or Sub-Advisor received that were directly attributable to the management of the applicable Funds as discussed in further detail below. Based on its review, the Board was satisfied that the Advisor’s level of profitability from its relationship with each Fund was not unreasonable in light of the services provided.
In addition to the Advisor’s profitability, the Independent Trustees reviewed information reflecting the financial condition of the Sub-Advisor. Although profitability on a per account level was not available, the Trustees reviewed the Sub-Advisor’s financial statements for the years ended December 31, 2017 and 2016. Based on its review, including the Sub-Advisor’s fee schedule and the fact that the sub-advisory fee was established through arm’s length negotiations, the Independent Trustees concluded that the Sub-Advisor’s profitability from its relationship with the U.S. Treasury Fund was not unreasonable.
| D. | | ECONOMIESOF SCALEAND WHETHER FEE LEVELS REFLECT THESE ECONOMIESOF SCALE |
The Board considered information provided by the Advisor regarding the possible existence of economies of scale as a Fund’s assets grow and whether the Funds have appropriately benefited from such economies of scale. In its review, the Independent Trustees recognized that economies of scale are difficult to assess or quantify, particularly on a Fund-by-Fund basis. The Independent Trustees observed that economies of scale generally occur as assets grow. However, several Funds have capacity constraints, particularly those investing primarily in small- and micro-cap companies. In light of these constraints, the Advisor has periodically closed Funds to new investments to protect performance that may not be able to be replicated at higher asset levels. Such practice may prevent such Funds from achieving economies of scale that may exist at such higher asset levels. Although the Independent Trustees recognized that closing a Fund may prevent certain economies of scale from being achieved, the Trustees noted the benefit of protecting performance for existing
shareholders and maintaining the assets of these Funds at levels the Advisor believes can be effectively managed. The Independent Trustees also recognized the costs of the Advisor’s research-intensive investment process in managing Funds and the Advisor’s loss of potential revenues that could be earned on higher asset levels when a Fund is closed to new investments. With respect to Funds without capacity constraints, the Independent Trustees considered the Advisor’s position that such Funds were not of a sufficient scale to benefit from breakpoints in the fee schedule. Further, although the management fees would remain the same as assets increased since they are not subject to investment advisory fee breakpoints, the Board recognized that shareholders would benefit from the temporary expense limitation agreements that limit the overall net expense ratios on the respective classes of the Funds and which may be considered another means for sharing economies of scale.
Considering the factors above, the Independent Trustees concluded the absence of breakpoints in the management fees was acceptable and that such economies as exist are adequately reflected in the Advisor’s fee structure.
E. INDIRECT BENEFITS
The Independent Trustees received and considered information regarding indirect benefits the Advisor and Sub-Advisor may receive as a result of their relationship with the respective Fund(s). In this regard, the Independent Trustees recognized that the Advisor may receive benefits from soft dollar arrangements whereby the Advisor may use a portion of the brokerage commissions paid by the Funds to acquire research that may be useful to the Advisor in managing the Funds and other clients. The Independent Trustees recognized that the Advisor’s profitability would be lower if it paid for such research with its own revenues. With respect to the Sub-Advisor, the Independent Trustees recognized that the Sub-Advisor has not participated in soft dollar arrangements with respect to the U.S. Treasury Fund’s portfolio transactions. The Independent Trustees further considered the reputational and/or marketing benefits the Advisor and Sub-Advisor may receive as a result of their association with the Funds. The Independent Trustees took these indirect benefits into account when accessing the level of advisory fees paid to the Advisor and sub-advisory fee to the Sub-Advisor and concluded that the indirect benefits received were reasonable.
| F. | | ANNUAL APPROVALOF ADVISORYAND SUB-ADVISORY AGREEMENTS |
The Independent Trustees did not identify any single factor discussed previously as all-important or controlling. The Board concluded that the terms of the Advisory Agreement for each Fund and the Sub-Advisory Agreement with the Sub-Advisor on behalf of the U.S. Treasury Fund were fair and reasonable, that the Advisor’s and Sub-Advisor’s fees are reasonable in light of the services provided to each respective Fund, and that the Advisory Agreement should be approved on behalf of each Fund and the Sub-Advisory Agreement should be approved on behalf of the U.S. Treasury Fund.
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Service Providers
INVESTMENT ADVISOR
Wasatch Advisors, Inc.
505 Wakara Way, 3rd Floor
Salt Lake City, UT 84108
SUB-ADVISORFORTHE WASATCH-HOISINGTON U.S. TREASURY FUND
Hoisington Investment Management Co.
6836 Bee Caves Road
Building 2, Suite 100
Austin, TX 78746
ADMINISTRATORAND FUND ACCOUNTANT
State Street Bank and Trust Company
801 Pennsylvania Avenue
Kansas City, MO 64105
DISTRIBUTOR
ALPS Distributors, Inc.
1290 Broadway, Suite 1100
Denver, CO 80203
TRANSFER AGENT
UMB Fund Services, Inc.
235 West Galena Street
Milwaukee, WI 53212
CUSTODIAN
State Street Bank and Trust Company
801 Pennsylvania Avenue
Kansas City, MO 64105
LEGAL COUNSELTO WASATCH FUNDSAND
INDEPENDENT TRUSTEES
Chapman and Cutler, LLP
111 West Monroe Street
Chicago, IL 60603
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
PricewaterhouseCoopers LLP
1100 Walnut Street, Suite 1300
Kansas City, MO 64106
TELEPHONE
800.551.1700
M - F, 7:00 a.m. to 7:00 p.m. Central Time
Automated Line, 24 Hours
U.S. MAIL
Wasatch Funds
P.O. Box 2172
Milwaukee, WI 53201-2172
OVERNIGHT DELIVERY
Wasatch Funds
235 West Galena Street
Milwaukee, WI 53212
ONLINE
www.WasatchFunds.com
shareholderservice@wasatchfunds.com
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2019 Semi-Annual Report www.WasatchFunds.com
Item 2. Code of Ethics.
Not required.
Item 3. Audit Committee Financial Expert.
Not required.
Item 4. Principal Accountant Fees and Services.
Not required.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Schedule of Investments.
| (a) | Schedule of Investments is included as a part of the report to shareholders filed under Item 1 of this FormN-CSR. |
Item 7. Disclosure of Proxy Voting Policies and Procedures forClosed-End Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers ofClosed-End Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities byClosed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s board of trustees, where those changes were implemented after the Registrant last provided disclosure in response to this item.
Item 11. Controls and Procedures.
| (a) | The Registrant’s principal executive and principal financial officers have concluded that the Registrant’s disclosure controls and procedures (as defined in Rule30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective, as of a date within 90 days of the filing date of this FormN-CSR based on their evaluation of these controls and procedures required by Rule30a-3(b) under the 1940 Act) and Rules13a-15(b) or15d-15(b) under the Securities Exchange Act of 1934). |
| (b) | There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule30a-3(d) under the 1940 Act) that occurred during the Registrant’s 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. Disclosure of Securities Lending Activities forClosed-End Management Investment Companies.
Item 13. Exhibits.
| (a)(2) | The certifications required by Rule30a-2(a) of the 1940 Act are attached hereto. |
| (b) | The certifications required by Rule30a-2(b) of the 1940 Act and Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto. |
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.
WASATCH FUNDS TRUST
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By: | | /s/ Eric S. Bergeson |
| | Eric S. Bergeson |
| | President (principal executive officer) of Wasatch Funds Trust |
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Date: | | May 30, 2019 |
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.
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By: | | /s/ Eric S. Bergeson |
| | Eric S. Bergeson |
| | President (principal executive officer) of Wasatch Funds Trust |
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Date: | | May 30, 2019 |
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By: | | /s/ Michael K. Yeates |
| | Michael K. Yeates |
| | Treasurer (principal financial officer) of Wasatch Funds Trust |
| |
Date: | | May 30, 2019 |
