UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File number: 811-06563
Calvert World Values Fund, Inc.
(Exact Name of Registrant as Specified in Charter)
4550 Montgomery Avenue, Suite 1000N, Bethesda, Maryland 20814
(Address of Principal Executive Offices)
Maureen A. Gemma
Two International Place, Boston, Massachusetts 02110
(Name and Address of Agent for Service)
(301) 951-4800
(Registrant's telephone number)
September 30
Date of Fiscal Year End
March 31, 2017
Date of Reporting Period
Item 1. Report to Stockholders.
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Calvert International Equity Fund | ![]() | |
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Semiannual Report March 31, 2017 E-Delivery Sign-Up — Details Inside | ![]() |
Choose Planet-friendly E-delivery! Sign up now for on-line statements, prospectuses, and fund reports. In less than five minutes you can help reduce paper mail and lower fund costs. Just go to calvert.com. If you already have an online account at Calvert, click on Login, to access your Account, and select the documents you would like to receive via e-mail. If you’re new to online account access, click on Login, then Register to create your user name and password. Once you’re in, click on the E-delivery sign-up on the Account Portfolio page and follow the quick, easy steps. Note: if your shares are not held directly at Calvert but through a brokerage firm, you must contact your broker for electronic delivery options available through their firm. |
PERFORMANCE AND FUND PROFILE
Performance1,2 | ||||||||||||||||
Portfolio Managers Christopher M. Dyer, CFA and Ian Kirwan of Eaton Vance Management (International) Limited; Christopher Madden, CFA and Jade Huang, each of Calvert Research and Management | ||||||||||||||||
% Average Annual Total Returns | Class Inception Date | Performance Inception Date | Six Months | One Year | Five Years | Ten Years | ||||||||||
Class A at NAV | 07/02/1992 | 07/02/1992 | 3.42 | % | 5.53 | % | 3.83 | -2.20 | % | |||||||
Class A with 4.75% Maximum Sales Charge | — | — | -1.48 | 0.49 | 2.82 | -2.67 | ||||||||||
Class C at NAV | 03/01/1994 | 07/02/1992 | 3.02 | 4.75 | 2.94 | -3.03 | ||||||||||
Class C with 1% Maximum Sales Charge | — | — | 2.02 | 3.75 | 2.94 | -3.03 | ||||||||||
Class I at NAV | 02/26/1999 | 07/02/1992 | 3.59 | 5.96 | 4.43 | -1.56 | ||||||||||
Class Y at NAV | 10/31/2008 | 07/02/1992 | 3.55 | 5.82 | 4.17 | -1.89 | ||||||||||
MSCI EAFE Index | 6.48 | % | 11.67 | % | 5.83 | % | 1.05 | % | ||||||||
Ticker Symbol | Class A | Class C | Class I | Class Y | ||||||||||||
CWVGX | CWVCX | CWVIX | CWEYX | |||||||||||||
% Total Annual Operating Expense Ratios3 | Class A | Class C | Class I | Class Y | ||||||||||||
Gross | 1.55 | % | 2.48 | % | 1.04 | % | 1.16 | % | ||||||||
Net | 1.34 | 2.09 | 0.96 | 1.09 |
Fund Profile | |||||||
SECTOR ALLOCATION (% of total investments)4 | TEN LARGEST STOCK HOLDINGS (% of net assets) | ||||||
Financials | 20.4 | % | Nestle SA | 3.8 | % | ||
Industrials | 14.8 | % | iShares MSCI Japan ETF | 3.0 | % | ||
Consumer Discretionary | 12.0 | % | Nippon Telegraph & Telephone Corp. | 2.6 | % | ||
Consumer Staples | 11.9 | % | Prudential plc | 2.5 | % | ||
Health Care | 11.7 | % | Iberdrola SA | 2.5 | % | ||
Information Technology | 6.8 | % | Samsonite International SA | 2.4 | % | ||
Telecommunication Services | 5.3 | % | Unilever plc | 2.4 | % | ||
Materials | 3.6 | % | Kerry Group plc, Class A | 2.4 | % | ||
Exchange-Traded Funds | 2.9 | % | Novo Nordisk A/S, Class B | 2.3 | % | ||
Energy | 2.9 | % | Roche Holding AG | 2.3 | % | ||
Utilities | 2.5 | % | Total | 26.2 | % | ||
High Social Impact Investments | 1.9 | % | |||||
Real Estate | 1.5 | % | |||||
Time Deposit | 1.0 | % | |||||
Venture Capital Limited Partnership Interest | 0.5 | % | |||||
Venture Capital | 0.3 | % | |||||
Total | 100.0 | % |
See Endnotes and Additional Disclosures in this report.
Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value (NAV) or offering price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance less than or equal to one year is cumulative. Performance is for the stated time period only; due to market volatility, the Fund's current performance may be lower or higher than quoted. Returns are before taxes unless otherwise noted. For performance as of the most recent month-end, please refer to calvert.com.
2 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
Endnotes and Additional Disclosures | ||
1 MSCI EAFE Index is an unmanaged index of equities in the developed markets, excluding the U.S. and Canada. MSCI indexes are net of foreign withholding taxes. Source: MSCI. MSCI data may not be reproduced or used for any other purpose. MSCI provides no warranties, has not prepared or approved this report, and has no liability hereunder. Unless otherwise stated, index returns do not reflect the effect of any applicable sales charges, commissions, expenses, taxes or leverage, as applicable. It is not possible to invest directly in an index.2 Total Returns at NAV do not include applicable sales charges. If sales charges were deducted, the returns would be lower. Total Returns shown with maximum sales charge reflect the stated maximum sales charge. Unless otherwise stated, performance does not reflect the deduction of taxes on Fund distributions or redemptions of Fund shares.Performance prior to the inception date of a class may be linked to the performance of an older class of the Fund. This linked performance is adjusted for any applicable sales charge, but is not adjusted for class expense differences. If adjusted for such differences, the performance would be different. The performance of Class Y is linked to Class A. Performance since inception for an index, if presented, is the performance since the Fund’s or oldest share class’ inception, as applicable. Performance presented in the Financial Highlights included in the financial statements is not linked. 3 Source: Fund prospectus. Net expense ratios reflect a contractual expense reimbursement that continues through 1/31/18. Without the reimbursement, performance would have been lower. The expense ratios for the current reporting period can be found in the Financial Highlights section of this report.4 Does not include Short Term Investment of Cash Collateral for Securities Loaned.Fund profile subject to change due to active management. |
calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 3
UNDERSTANDING YOUR FUND'S EXPENSES
As an investor, you incur two types of costs. There are transaction costs, which generally include sales charges (loads) on purchases and may include redemption fees. There are also ongoing costs, which generally include management fees, distribution and/or service fees, and other fund expenses. The following information is intended to help you understand your ongoing costs (in dollars) of investing in this mutual fund and to help you compare these costs with the ongoing costs of investing in other mutual funds.
To illustrate these ongoing costs, we have provided examples and calculated the expenses paid by the Fund's investors during the period. The actual and hypothetical information presented in the examples is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (October 1, 2016 to March 31, 2017).
Actual Expenses
The first line for each class of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 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.
Hypothetical Example for Comparison Purposes
The second line for each class of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and 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 the Fund and other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the 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 sales charges (loads) or redemption fees, if applicable. 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.
ANNUALIZED EXPENSE RATIO | BEGINNING ACCOUNT VALUE 10/1/16 | ENDING ACCOUNT VALUE 3/31/17 | EXPENSES PAID DURING PERIOD* 10/1/16 - 3/31/17 | |
Class A | ||||
Actual | 1.36% | $1,000.00 | $1,034.20 | $6.90 |
Hypothetical (5% return per year before expenses) | 1.36% | $1,000.00 | $1,018.15 | $6.84 |
Class C | ||||
Actual | 2.12% | $1,000.00 | $1,030.20 | $10.73 |
Hypothetical (5% return per year before expenses) | 2.12% | $1,000.00 | $1,014.36 | $10.65 |
Class I | ||||
Actual | 0.96% | $1,000.00 | $1,035.90 | $4.87 |
Hypothetical (5% return per year before expenses) | 0.96% | $1,000.00 | $1,020.15 | $4.84 |
Class Y | ||||
Actual | 1.11% | $1,000.00 | $1,035.50 | $5.63 |
Hypothetical (5% return per year before expenses) | 1.11% | $1,000.00 | $1,019.40 | $5.59 |
* Expenses paid during the period are equal to the annualized expense ratio for each class as indicated above, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). |
4 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL EQUITY FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2017 (Unaudited)
SHARES | VALUE ($) | |
COMMON STOCKS - 93.7% | ||
Australia - 4.9% | ||
Brambles Ltd. | 462,187 | 3,300,684 |
Challenger Ltd. | 345,801 | 3,314,321 |
Commonwealth Bank of Australia | 75,351 | 4,941,144 |
11,556,149 | ||
Belgium - 3.5% | ||
KBC Groep NV | 66,032 | 4,377,454 |
UCB SA | 50,632 | 3,927,432 |
8,304,886 | ||
Canada - 2.3% | ||
CAE, Inc. | 355,943 | 5,438,780 |
Denmark - 5.1% | ||
Novo Nordisk A/S, Class B | 159,216 | 5,467,308 |
Novozymes A/S, Class B | 98,812 | 3,914,894 |
Pandora A/S | 24,424 | 2,703,207 |
12,085,409 | ||
France - 3.7% | ||
Kering | 15,801 | 4,084,002 |
Legrand SA | 75,334 | 4,534,922 |
8,618,924 | ||
Germany - 5.2% | ||
Brenntag AG | 59,818 | 3,352,599 |
Continental AG | 18,506 | 4,057,443 |
SAP SE | 48,737 | 4,781,487 |
12,191,529 | ||
Hong Kong - 2.4% | ||
Samsonite International SA | 1,584,880 | 5,763,356 |
Ireland - 6.4% | ||
CRH plc | 130,310 | 4,589,411 |
Kerry Group plc, Class A | 71,324 | 5,607,717 |
Shire plc | 84,479 | 4,922,348 |
15,119,476 | ||
calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 5
SHARES | VALUE ($) | |||
COMMON STOCKS - CONT’D | ||||
Japan - 18.2% | ||||
Astellas Pharma, Inc. | 198,264 | 2,614,887 | ||
Fuji Heavy Industries Ltd. | 106,638 | 3,911,298 | ||
Kao Corp. | 69,441 | 3,813,459 | ||
Komatsu Ltd. | 168,202 | 4,405,761 | ||
Kubota Corp. | 233,208 | 3,515,255 | ||
Mitsubishi Estate Co. Ltd. | 191,637 | 3,492,902 | ||
Mitsubishi UFJ Financial Group, Inc. | 729,796 | 4,597,107 | ||
Nippon Telegraph & Telephone Corp. | 142,147 | 6,077,256 | ||
Santen Pharmaceutical Co. Ltd. (a) | 288,392 | 4,188,944 | ||
Seven & I Holdings Co. Ltd. | 101,117 | 3,972,242 | ||
Sumco Corp. | 139,100 | 2,323,557 | ||
42,912,668 | ||||
Kenya - 0.5% | ||||
Safaricom Ltd. | 6,402,645 | 1,136,454 | ||
Luxembourg - 1.6% | ||||
Tenaris SA | 221,093 | 3,823,217 | ||
Netherlands - 4.2% | ||||
ASML Holding NV | 39,933 | 5,298,821 | ||
ING Groep NV | 304,572 | 4,600,335 | ||
9,899,156 | ||||
Singapore - 1.8% | ||||
DBS Group Holdings Ltd. | 300,928 | 4,168,422 | ||
South Africa - 0.5% | ||||
Aspen Pharmacare Holdings Ltd. | 55,580 | 1,137,130 | ||
Spain - 4.0% | ||||
Iberdrola SA | 810,750 | 5,792,718 | ||
Industria de Diseno Textil SA | 102,138 | 3,596,947 | ||
9,389,665 | ||||
Sweden - 1.1% | ||||
Swedbank AB, Class A (a) | 111,819 | 2,587,318 | ||
Switzerland - 8.1% | ||||
Credit Suisse Group AG * | 321,249 | 4,779,743 | ||
Nestle SA | 116,009 | 8,903,890 | ||
Roche Holding AG | 21,358 | 5,461,958 | ||
19,145,591 | ||||
Taiwan - 1.6% | ||||
Taiwan Semiconductor Manufacturing Co. Ltd. (ADR) | 111,227 | 3,652,695 | ||
6 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
SHARES | VALUE ($) | |||
COMMON STOCKS - CONT’D | ||||
United Kingdom - 18.6% | ||||
Ashtead Group plc | 154,352 | 3,194,976 | ||
Aviva plc | 644,021 | 4,297,592 | ||
John Wood Group plc | 316,278 | 3,021,436 | ||
Melrose Industries plc | 1,187,019 | 3,316,493 | ||
Prudential plc | 282,456 | 5,966,405 | ||
St James's Place plc | 356,205 | 4,741,423 | ||
Unilever plc | 116,675 | 5,755,258 | ||
Vodafone Group plc | 2,018,645 | 5,260,557 | ||
Weir Group plc (The) | 167,315 | 4,024,793 | ||
WPP plc | 194,736 | 4,268,433 | ||
43,847,366 | ||||
Total Common Stocks (Cost $212,999,832) | 220,778,191 | |||
PREFERRED STOCKS - 0.1% | ||||
Venture Capital - 0.1% | ||||
Bioceptive, Inc.: | ||||
Series A *(b)(c) | 582,574 | — | ||
Series B *(b)(c) | 40,523 | — | ||
FINAE, Series D *(b)(c) | 2,597,442 | 206,716 | ||
206,716 | ||||
Total Preferred Stocks (Cost $521,381) | 206,716 | |||
EXCHANGE-TRADED FUNDS - 3.0% | ||||
iShares MSCI Japan ETF | 135,022 | 6,953,633 | ||
Total Exchange-Traded Funds (Cost $6,823,763) | 6,953,633 | |||
VALUE ($) | ||||
VENTURE CAPITAL LIMITED PARTNERSHIP INTEREST - 0.5% | ||||
Africa Renewable Energy Fund LP *(b)(c) | 560,172 | |||
BFSE Holding, BV LP *(b)(c) | 203,282 | |||
Blackstone Clean Technology Partners LP *(b)(c) | 12,652 | |||
China Environment Fund 2004 LP *(b)(c) | 3,787 | |||
Emerald Sustainability Fund I LP *(b)(c) | 115,840 | |||
gNet Defta Development Holding LLC *(b)(c)(d) | 295,471 | |||
SEAF Central and Eastern European Growth Fund LLC *(b)(c)(d) | 69,489 | |||
SEAF India International Growth Fund LP *(b)(c) | 26,614 | |||
Terra Capital LP *(b)(c) | — | |||
Total Venture Capital Limited Partnership Interest (Cost $2,985,553) | 1,287,307 | |||
calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 7
PRINCIPAL AMOUNT ($) | VALUE ($) | |||
VENTURE CAPITAL DEBT OBLIGATIONS - 0.2% | ||||
AFIG LLC, 6.00%, 10/17/17 (b)(c) | 450,953 | 448,987 | ||
Windhorse International-Spring Health Water Ltd., 1.00%, 3/14/18 (b)(c)(e) | 70,000 | 52,500 | ||
Total Venture Capital Debt Obligations (Cost $520,953) | 501,487 | |||
HIGH SOCIAL IMPACT INVESTMENTS - 2.0% | ||||
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 (b)(d) | 4,431,583 | 4,147,031 | ||
ImpactAssets Inc., Global Sustainable Agriculture Notes, 0.00%, 11/3/20 (b)(c)(f) | 220,000 | 195,800 | ||
ImpactAssets Inc., Microfinance Plus Notes, 0.00%, 11/3/20 (b)(c)(f) | 283,000 | 266,020 | ||
Total High Social Impact Investments (Cost $4,934,583) | 4,608,851 | |||
VALUE ($) | ||||
OTHER - 0.0% | ||||
Powerspan Corp., Contingent Deferred Distribution *(b)(c) | — | |||
Total Other (Cost $—) | — | |||
PRINCIPAL AMOUNT ($) | VALUE ($) | |||
TIME DEPOSIT - 1.0% | ||||
State Street Bank and Trust Eurodollar Time Deposit, 0.09%, 4/3/17 | 2,360,596 | 2,360,596 | ||
Total Time Deposit (Cost $2,360,596) | 2,360,596 | |||
SHARES | VALUE ($) | |||
SHORT TERM INVESTMENT OF CASH COLLATERAL FOR SECURITIES LOANED - 2.4% | ||||
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.62% | 5,707,554 | 5,707,554 | ||
Total Short Term Investment of Cash Collateral For Securities Loaned (Cost $5,707,554) | 5,707,554 | |||
TOTAL INVESTMENTS (Cost $236,854,215) - 102.9% | 242,404,335 | |||
Other assets and liabilities, net - (2.9%) | (6,894,494) | |||
NET ASSETS - 100.0% | $235,509,841 |
8 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
At March 31, 2017, the concentration of the Fund's investments in the various sectors, determined as a percentage of total investments, was as follows: | ||
ECONOMIC SECTORS | % OF TOTAL INVESTMENT* | |
Financials | 20.4 | % |
Industrials | 14.8 | % |
Consumer Discretionary | 12.0 | % |
Consumer Staples | 11.9 | % |
Health Care | 11.7 | % |
Information Technology | 6.8 | % |
Telecommunication Services | 5.3 | % |
Materials | 3.6 | % |
Exchange-Traded Funds | 2.9 | % |
Energy | 2.9 | % |
Utilities | 2.5 | % |
High Social Impact Investments | 1.9 | % |
Real Estate | 1.5 | % |
Time Deposit | 1.0 | % |
Venture Capital Limited Partnership Interest | 0.5 | % |
Venture Capital | 0.3 | % |
Total | 100.0 | % |
*Does not include Short Term Investment of Cash Collateral for Securities Loaned. |
NOTES TO SCHEDULE OF INVESTMENTS |
* Non-income producing security. |
(a) Security, or portion of security, is on loan. Total value of securities on loan is $5,163,831 as of March 31, 2017. |
(b) Restricted security. Total market value of restricted securities amounts to $6,604,361, which represents 2.8% of the net assets of the Fund as of March 31, 2017. |
(c) For fair value measurement disclosure purposes, security is categorized as Level 3 (see Note A). |
(d) Affiliated company (see Note G). |
(e) Security defaulted as to principal and interest in March 2013. It has been restructured at a 9% rate maturing on March 14, 2018 with 1% to be paid annually and the remaining interest due at maturity. This security is currently accruing at 1%. |
(f) Notes carry an interest rate that varies by period and is contingent on the performance of the underlying portfolio of loans to borrowers. The coupon rate shown represents the rate in effect at March 31, 2017. |
Abbreviations: | |
ADR: | American Depositary Receipts |
ETF: | Exchange-Traded Fund |
See notes to financial statements. |
calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 9
RESTRICTED SECURITIES | ACQUISITION DATES | COST ($) | |
AFIG LLC, 6.00%, 10/17/17 | 10/11/12 | 450,953 | |
Africa Renewable Energy Fund LP | 4/17/14-3/6/17 | 635,688 | |
BFSE Holding, BV LP | 1/12/06-8/9/16 | 610,427 | |
Bioceptive, Inc., Series A | 10/26/12-12/18/13 | 252,445 | |
Bioceptive, Inc., Series B | 1/7/16 | 16,250 | |
Blackstone Clean Technology Partners LP | 7/29/10-6/25/15 | 78,853 | |
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 | 12/15/16 | 4,431,583 | |
China Environment Fund 2004 LP | 9/15/05-4/1/09 | — | |
Emerald Sustainability Fund I LP | 7/19/01-5/17/11 | 425,186 | |
FINAE, Series D | 2/28/11-11/16/15 | 252,686 | |
gNet Defta Development Holding LLC | 8/30/05 | 400,000 | |
ImpactAssets Inc., Global Sustainable Agriculture Notes, 0.00%, 11/3/20 | 11/13/15 | 220,000 | |
ImpactAssets Inc., Microfinance Plus Notes, 0.00%, 11/3/20 | 11/13/15 | 283,000 | |
Powerspan Corp., Contingent Deferred Distribution | 7/11/14 | — | |
SEAF Central and Eastern European Growth Fund LLC | 8/10/00-8/26/11 | 155,418 | |
SEAF India International Growth Fund LP | 3/22/05-5/24/10 | 210,391 | |
Terra Capital LP | 11/23/98-3/14/06 | 469,590 | |
Windhorse International-Spring Health Water Ltd., 1.00%, 3/14/18 | 2/12/14 | 70,000 | |
See notes to financial statements. |
10 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL EQUITY FUND
STATEMENT OF ASSSETS AND LIABILITIES
MARCH 31, 2017 (Unaudited)
ASSETS | |||
Investments in unaffiliated securities, at value (Cost $231,867,214) - see accompanying schedule | $237,892,344 | ||
Investments in affiliated securities, at value (Cost $4,987,001) - see accompanying schedule | 4,511,991 | ||
Cash | 32,076 | ||
Foreign currency, at value (Cost $186,508) | 185,761 | ||
Receivable for securities sold | 380,273 | ||
Receivable for Fund shares sold | 165,885 | ||
Dividends and interest receivable | 874,804 | ||
Interest receivable - affiliated | 19,757 | ||
Securities lending income receivable | 57 | ||
Directors' deferred compensation plan | 212,952 | ||
Tax reclaims receivable | 604,527 | ||
Receivable from affiliate | 54,785 | ||
Total assets | 244,935,212 | ||
LIABILITIES | |||
Payable for securities purchased | 2,417,771 | ||
Collateral for securities loaned | 5,707,554 | ||
Payable for Fund shares redeemed | 708,087 | ||
Payable to affiliates: | |||
Investment advisory fee | 151,567 | ||
Administrative fees | 24,251 | ||
Distribution Plan expenses | 37,740 | ||
Sub-transfer agent fee | 8,742 | ||
Directors' fees and expenses | 3,697 | ||
Directors' deferred compensation plan | 212,952 | ||
Accrued expenses and other liabilities | 153,010 | ||
Total liabilities | 9,425,371 | ||
Commitments and Contingencies (see Note I) | |||
NET ASSETS | $235,509,841 | ||
NET ASSETS CONSIST OF: | |||
Paid-in capital applicable to common stock | |||
(250,000,000 shares of $0.01 par value authorized) | $398,646,704 | ||
Accumulated distributions in excess of net investment income | (443,765 | ) | |
Accumulated net realized gain (loss) | (168,220,752 | ) | |
Net unrealized appreciation (depreciation) | 5,527,654 | ||
NET ASSETS | $235,509,841 | ||
NET ASSET VALUE PER SHARE | |||
Class A (based on net assets of $125,992,496 and 8,082,361 shares outstanding) | $15.59 | ||
Class C (based on net assets of $12,611,872 and 938,986 shares outstanding) | $13.43 | ||
Class I (based on net assets of $77,748,193 and 4,686,109 shares outstanding) | $16.59 | ||
Class Y (based on net assets of $19,157,280 and 1,165,198 shares outstanding) | $16.44 | ||
calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 11
OFFERING PRICE PER SHARE* | |||
Class A (100/95.25 of net asset value per share) | $16.37 | ||
* On sales of $50,000 or more, the offering price of Class A shares is reduced. | |||
See notes to financial statements. |
12 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL EQUITY FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED MARCH 31, 2017 (Unaudited)
NET INVESTMENT INCOME | |||
Investment Income: | |||
Dividend income (net of foreign taxes withheld of $200,135) | $2,587,656 | ||
Interest income | 22,070 | ||
Interest income - affiliated | 22,012 | ||
Securities lending income | 6,528 | ||
Other income | 762 | ||
Total investment income | 2,639,028 | ||
Expenses: | |||
Investment advisory fee | 1,051,659 | ||
Administrative fees | 169,007 | ||
Transfer agency fees and expenses: | |||
Class A | 194,270 | ||
Class C | 24,000 | ||
Class I | 9,739 | ||
Class Y | 11,671 | ||
Distribution Plan expenses: | |||
Class A | 171,474 | ||
Class C | 63,514 | ||
Directors' fees and expenses | 17,979 | ||
Accounting fees | 45,991 | ||
Custodian fees | 68,731 | ||
Professional fees | 57,897 | ||
Registration fees: | |||
Class A | 10,062 | ||
Class C | 6,611 | ||
Class I | 8,838 | ||
Class Y | 9,342 | ||
Reports to shareholders | 24,692 | ||
Miscellaneous | 33,601 | ||
Total expenses | 1,979,078 | ||
Reimbursement from Adviser: | |||
Class A | (159,542 | ) | |
Class C | (26,403 | ) | |
Class I | (62,536 | ) | |
Class Y | (14,731 | ) | |
Net expenses | 1,715,866 | ||
NET INVESTMENT INCOME (LOSS) | 923,162 | ||
calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 13
REALIZED AND UNREALIZED GAIN (LOSS) | |||
Net realized gain (loss) on: | |||
Investments | 10,270,094 | ||
Foreign currency transactions | (57,659 | ) | |
10,212,435 | |||
Net change in unrealized appreciation (depreciation) on: | |||
Investments in unaffiliated securities | (4,579,888 | ) | |
Investments in affiliated securities | (228,530 | ) | |
Foreign currency | (6,748 | ) | |
(4,815,166 | ) | ||
NET REALIZED AND UNREALIZED GAIN (LOSS) | 5,397,269 | ||
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $6,320,431 | ||
See notes to financial statements. |
14 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL EQUITY FUND
STATEMENTS OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS | SIX MONTHS ENDED MARCH 31, 2017(Unaudited) | YEAR ENDED SEPTEMBER 30, 2016 | |||||
Operations: | |||||||
Net investment income (loss) | $923,162 | $8,117,904 | |||||
Net realized gain (loss) | 10,212,435 | (42,935,803 | ) | ||||
Net change in unrealized appreciation (depreciation) | (4,815,166 | ) | 36,536,742 | ||||
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | 6,320,431 | 1,718,843 | |||||
Distributions to shareholders from: | |||||||
Net investment income: | |||||||
Class A shares | (3,452,931 | ) | (1,496,038 | ) | |||
Class C shares | (255,867 | ) | (82,845 | ) | |||
Class I shares | (4,232,336 | ) | (2,202,975 | ) | |||
Class Y shares | (513,395 | ) | (342,786 | ) | |||
Total distributions | (8,454,529 | ) | (4,124,644 | ) | |||
Capital share transactions: | |||||||
Shares sold: | |||||||
Class A shares | 8,531,422 | 26,167,775 | |||||
Class C shares | 580,797 | 1,231,606 | |||||
Class I shares | 26,591,729 | 50,232,783 | |||||
Class Y shares | 6,714,474 | 11,645,127 | |||||
Reinvestment of distributions: | |||||||
Class A shares | 2,962,903 | 1,309,720 | |||||
Class C shares | 219,647 | 71,438 | |||||
Class I shares | 2,183,790 | 1,301,923 | |||||
Class Y shares | 375,908 | 257,139 | |||||
Shares redeemed: | |||||||
Class A shares | (42,391,323 | ) | (36,344,297 | ) | |||
Class C shares | (1,901,410 | ) | (3,472,568 | ) | |||
Class I shares | (88,850,472 | ) | (58,854,335 | ) | |||
Class Y shares | (11,405,967 | ) | (8,434,840 | ) | |||
Total capital share transactions | (96,388,502 | ) | (14,888,529 | ) | |||
TOTAL INCREASE (DECREASE) IN NET ASSETS | (98,522,600 | ) | (17,294,330 | ) | |||
NET ASSETS | |||||||
Beginning of period | 334,032,441 | 351,326,771 | |||||
End of period (including accumulated undistributed (distributions in excess of) net investment income of ($443,765) and $7,087,602, respectively) | $235,509,841 | $334,032,441 | |||||
See notes to financial statements. |
calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 15
CAPITAL SHARE ACTIVITY | |||||
Shares sold: | |||||
Class A shares | 564,124 | 1,699,772 | |||
Class C shares | 44,874 | 92,905 | |||
Class I shares | 1,656,222 | 3,127,271 | |||
Class Y shares | 418,825 | 714,196 | |||
Reinvestment of distributions: | |||||
Class A shares | 201,970 | 81,501 | |||
Class C shares | 17,336 | 5,143 | |||
Class I shares | 139,987 | 76,136 | |||
Class Y shares | 24,315 | 15,188 | |||
Shares redeemed: | |||||
Class A shares | (2,806,687 | ) | (2,364,869 | ) | |
Class C shares | (146,229 | ) | (262,210 | ) | |
Class I shares | (5,584,809 | ) | (3,553,323 | ) | |
Class Y shares | (717,469 | ) | (528,729 | ) | |
Total capital share activity | (6,187,541 | ) | (897,019 | ) | |
See notes to financial statements. |
16 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS A SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012(a) | ||||||||||||
Net asset value, beginning | $15.49 | $15.62 | $16.51 | $16.44 | $13.49 | $11.84 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income | 0.04 | 0.34(b) | 0.18 | 0.15 | 0.08 | 0.12 | |||||||||||
Net realized and unrealized gain (loss) | 0.46 | (0.33) | (0.97) | 0.02 | 2.98 | 1.68 | |||||||||||
Total from investment operations | 0.50 | 0.01 | (0.79) | 0.17 | 3.06 | 1.80 | |||||||||||
Distributions from: | |||||||||||||||||
Net investment income | (0.40) | (0.14) | (0.10) | (0.10) | (0.11) | (0.15) | |||||||||||
Total distributions | (0.40) | (0.14) | (0.10) | (0.10) | (0.11) | (0.15) | |||||||||||
Total increase (decrease) in net asset value | 0.10 | (0.13) | (0.89) | 0.07 | 2.95 | 1.65 | |||||||||||
Net asset value, ending | $15.59 | $15.49 | $15.62 | $16.51 | $16.44 | $13.49 | |||||||||||
Total return (c) | 3.42 | % | 0.04 | % | (4.78 | %) | 0.99 | % | 22.82 | % | 15.34 | % | |||||
Ratios to average net assets: (d) | |||||||||||||||||
Net investment income | 0.57%(e) | 2.20%(b) | 1.08 | % | 0.88 | % | 0.52 | % | 0.96 | % | |||||||
Total expenses | 1.60%(e) | 1.62 | % | 1.67 | % | 1.66 | % | 1.76 | % | 1.84 | % | ||||||
Net expenses | 1.36%(e) | 1.38 | % | 1.54 | % | 1.66 | % | 1.76 | % | 1.80 | % | ||||||
Portfolio turnover | 101 | % | 94 | % | 97 | % | 82 | % | 40 | % | 43 | % | |||||
Net assets, ending (in thousands) | $125,992 | $156,757 | $167,225 | $263,718 | $242,464 | $183,588 | |||||||||||
(a) Net investment income per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.013 per share and 0.08% of average net assets. | |||||||||||||||||
(c) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(d) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(e) Annualized. | |||||||||||||||||
See notes to financial statements. |
calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 17
CALVERT INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS C SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012(a) | ||||||||||||
Net asset value, beginning | $13.31 | $13.47 | $14.27 | $14.26 | $11.71 | $10.26 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income (loss) | (0.01) | 0.19(b) | 0.04 | (0.01) | (0.05) | 0.01 | |||||||||||
Net realized and unrealized gain (loss) | 0.40 | (0.28) | (0.84) | 0.02 | 2.60 | 1.45 | |||||||||||
Total from investment operations | 0.39 | (0.09) | (0.80) | 0.01 | 2.55 | 1.46 | |||||||||||
Distributions from: | |||||||||||||||||
Net investment income | (0.27) | (0.07) | — | — | — | (0.01) | |||||||||||
Total distributions | (0.27) | (0.07) | — | — | — | (0.01) | |||||||||||
Total increase (decrease) in net asset value | 0.12 | (0.16) | (0.80) | 0.01 | 2.55 | 1.45 | |||||||||||
Net asset value, ending | $13.43 | $13.31 | $13.47 | $14.27 | $14.26 | $11.71 | |||||||||||
Total return (c) | 3.02 | % | (0.68 | %) | (5.61 | %) | 0.07 | % | 21.78 | % | 14.23 | % | |||||
Ratios to average net assets: (d) | |||||||||||||||||
Net investment income (loss) | (0.17%)(e) | 1.42%(b) | 0.31 | % | (0.06 | %) | (0.40 | %) | 0.05 | % | |||||||
Total expenses | 2.53%(e) | 2.55 | % | 2.58 | % | 2.57 | % | 2.65 | % | 2.72 | % | ||||||
Net expenses | 2.12%(e) | 2.14 | % | 2.37 | % | 2.57 | % | 2.65 | % | 2.69 | % | ||||||
Portfolio turnover | 101 | % | 94 | % | 97 | % | 82 | % | 40 | % | 43 | % | |||||
Net assets, ending (in thousands) | $12,612 | $13,613 | $15,997 | $17,173 | $17,746 | $15,922 | |||||||||||
(a) Net investment income (loss) per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.011 per share and 0.08% of average net assets. | |||||||||||||||||
(c) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(d) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(e) Annualized. | |||||||||||||||||
See notes to financial statements. |
18 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS I SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012(a) | ||||||||||||
Net asset value, beginning | $16.53 | $16.73 | $17.68 | $17.69 | $14.52 | $12.70 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income | 0.07 | 0.44(b) | 0.30 | 0.28 | 0.17 | 0.24 | |||||||||||
Net realized and unrealized gain (loss) | 0.50 | (0.36) | (1.05) | 0.02 | 3.24 | 1.79 | |||||||||||
Total from investment operations | 0.57 | 0.08 | (0.75) | 0.30 | 3.41 | 2.03 | |||||||||||
Distributions from: | |||||||||||||||||
Net investment income | (0.51) | (0.28) | (0.20) | (0.31) | (0.24) | (0.21) | |||||||||||
Total distributions | (0.51) | (0.28) | (0.20) | (0.31) | (0.24) | (0.21) | |||||||||||
Total increase (decrease) in net asset value | 0.06 | (0.20) | (0.95) | (0.01) | 3.17 | 1.82 | |||||||||||
Net asset value, ending | $16.59 | $16.53 | $16.73 | $17.68 | $17.69 | $14.52 | |||||||||||
Total return (c) | 3.59 | % | 0.41 | % | (4.27 | %) | 1.64 | % | 23.74 | % | 16.16 | % | |||||
Ratios to average net assets: (d) | |||||||||||||||||
Net investment income | 0.82%(e) | 2.67%(b) | 1.68 | % | 1.53 | % | 1.07 | % | 1.71 | % | |||||||
Total expenses | 1.07%(e) | 1.04 | % | 1.03 | % | 1.02 | % | 1.06 | % | 1.09 | % | ||||||
Net expenses | 0.96%(e) | 0.95 | % | 0.98 | % | 1.02 | % | 1.06 | % | 1.06 | % | ||||||
Portfolio turnover | 101 | % | 94 | % | 97 | % | 82 | % | 40 | % | 43 | % | |||||
Net assets, ending (in thousands) | $77,748 | $140,129 | $147,614 | $92,318 | $82,499 | $101,203 | |||||||||||
(a) Net investment income per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.014 per share and 0.09% of average net assets. | |||||||||||||||||
(c) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(d) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(e) Annualized. | |||||||||||||||||
See notes to financial statements. |
calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 19
CALVERT INTERNATIONAL EQUITY FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS Y SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012(a) | ||||||||||||
Net asset value, beginning | $16.35 | $16.54 | $17.45 | $17.38 | $14.25 | $12.45 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income | 0.07 | 0.40(b) | 0.27 | 0.23 | 0.14 | 0.18 | |||||||||||
Net realized and unrealized gain (loss) | 0.48 | (0.35) | (1.05) | 0.02 | 3.15 | 1.77 | |||||||||||
Total from investment operations | 0.55 | 0.05 | (0.78) | 0.25 | 3.29 | 1.95 | |||||||||||
Distributions from: | |||||||||||||||||
Net investment income | (0.46) | (0.24) | (0.13) | (0.18) | (0.16) | (0.15) | |||||||||||
Total distributions | (0.46) | (0.24) | (0.13) | (0.18) | (0.16) | (0.15) | |||||||||||
Total increase (decrease) in net asset value | 0.09 | (0.19) | (0.91) | 0.07 | 3.13 | 1.80 | |||||||||||
Net asset value, ending | $16.44 | $16.35 | $16.54 | $17.45 | $17.38 | $14.25 | |||||||||||
Total return (c) | 3.55 | % | 0.28 | % | (4.52 | %) | 1.41 | % | 23.27 | % | 15.80 | % | |||||
Ratios to average net assets: (d) | |||||||||||||||||
Net investment income | 0.86%(e) | 2.50%(b) | 1.52 | % | 1.27 | % | 0.90 | % | 1.36 | % | |||||||
Total expenses | 1.27%(e) | 1.23 | % | 1.37 | % | 1.31 | % | 1.41 | % | 1.46 | % | ||||||
Net expenses | 1.11%(e) | 1.13 | % | 1.22 | % | 1.31 | % | 1.39 | % | 1.39 | % | ||||||
Portfolio turnover | 101 | % | 94 | % | 97 | % | 82 | % | 40 | % | 43 | % | |||||
Net assets, ending (in thousands) | $19,157 | $23,534 | $20,491 | $17,479 | $10,367 | $7,535 | |||||||||||
(a) Net investment income per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.014 per share and 0.09% of average net assets. | |||||||||||||||||
(c) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(d) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(e) Annualized. | |||||||||||||||||
See notes to financial statements. |
20 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
NOTES TO FINANCIAL STATEMENTS
NOTE A — SIGNIFICANT ACCOUNTING POLICIES
General: Calvert World Values Fund, Inc. (the “Corporation”) was organized as a Maryland corporation on February 14, 1992, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Corporation operates four (4) separate series, or mutual funds, each with its own investment objective(s) and strategies, that are accounted for separately. This report contains the financial statements and financial highlights of Calvert International Equity Fund (the “Fund”). The Corporation is authorized to issue two billion shares of common stock, $0.01 par value per share, of which 250 million shares have been allocated to the Fund.
The investment objective of the Fund is to seek to provide a high total return consistent with reasonable risk by investing primarily in a diversified portfolio of stocks. The Fund is diversified and invests primarily in equity securities of foreign companies.
The Fund offers Class A, Class C, Class I and Class Y shares. Class A shares are generally sold with a maximum front-end sales charge of 4.75%. A contingent deferred sales charge of 0.80% may apply to certain redemptions of Class A shares for accounts for which no sales charge was paid, if redeemed within one year of purchase. Class C shares are sold without a front-end sales charge, and with certain exceptions, are charged a contingent deferred sales charge of 1% on shares redeemed within one year of purchase. Class C shares have higher levels of expenses than Class A shares. Class I shares require a minimum account balance of $1 million. The $1 million minimum initial investment is waived for retirement plans that trade through omnibus accounts and may be waived in certain other instances where it is believed to be in the best interest of the Fund and its shareholders. Class I shares have no front-end or contingent deferred sales charge and have lower levels of expenses than Class A shares. Class Y shares are generally only available to wrap or similar fee-based programs offered by financial intermediaries that have entered into an agreement with the Fund’s principal underwriter to offer Class Y shares to their clients, and retirement plans, foundations, endowments and other consultant-driven business. Class Y shares have no front-end or contingent deferred sales charge and have lower levels of expenses than Class A shares. Among other things, each class has different: (a) dividend rates due to differences in Distribution Plan expenses and other class-specific expenses; (b) exchange privileges; and (c) class-specific voting rights.
The Fund applies the accounting and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946, Financial Services – Investment Companies (ASC 946). Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements.
Security Valuation: Net asset value per share is determined every business day as of the close of the regular session of the New York Stock Exchange (generally 4:00 p.m. Eastern time). The Fund uses independent pricing services approved by the Board of Directors (“the Board”) to value its investments wherever possible. Investments for which market quotations are not available or deemed not reliable are fair valued in good faith under the direction of the Board.
The Board has adopted Valuation Procedures (the “Procedures”) to determine the fair value of securities and financial instruments for which market prices are not readily available or which may not be reliably priced. The Board has delegated the day-to-day responsibility for determining the fair value of securities and financial instruments of the Fund to the Fund's investment adviser (the “Adviser”) and has provided these Procedures to govern the Adviser in its valuation duties.
The Adviser has chartered an internal Valuation Committee to oversee the implementation of these Procedures and to assist it in carrying out the valuation responsibilities that the Board has delegated.
The Valuation Committee meets on a regular basis to review investments which may not have readily available market prices. The Valuation Committee’s fair valuation determinations are subject to review, approval and ratification by the Board at its next regularly scheduled meeting covering the calendar quarter in which the fair valuation was determined.
The Valuation Committee utilizes various methods to measure the fair value of the Fund’s investments. U.S. generally accepted accounting principles (U.S. GAAP) establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are summarized in the three broad levels listed below:
Level 1 - quoted prices in active markets for identical securities
Level 2 - other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
Level 3 - significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 21
Changes in valuation techniques may result in transfers in or out of an investment’s assigned level within the hierarchy during the period. Transfers in and/or out of levels are determined based on the fair value of such securities at the end of the period. Valuation techniques used to value the Fund’s investments by major category are as follows:
Common stocks and preferred stocks for which market quotations are readily available are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or the last available price and are categorized as Level 2 in the hierarchy. Foreign securities are valued based on quotations from the principal market in which such securities are normally traded. The Fund has retained a third party fair value pricing service to quantitatively analyze the price movement of its holdings on foreign exchanges and to automatically fair value these securities each business day. The third party fair value pricing service takes into account many factors, including, but not limited to, movements in U.S. securities markets and changes in futures contracts and foreign exchange rates that have occurred after the close of the principal foreign market, to determine a fair value as of the close of the New York Stock Exchange. Such securities are categorized as Level 2 in the hierarchy.
Venture capital securities for which market quotations are not readily available are generally categorized as Level 3 in the hierarchy. Venture capital direct equity securities are generally valued using the most appropriate and applicable method to measure fair value in light of each company’s situation. Methods may include market, income or cost approaches with discounts as appropriate based on assumptions of liquidation or exit risk. Examples of the market approach are subsequent rounds of financing, comparable transactions, and revenue times an industry multiple. An example of the income approach is the discounted cash flow. Examples of the cost approach are replacement cost, salvage value, or net asset percentage. Investments in venture capital limited partnerships are valued at the fair value reported by the general partner of the partnership adjusted as necessary to reflect subsequent capital calls and distributions and any other available information. For venture capital securities denominated in foreign currency, the fair value is marked to the daily exchange rate.
For restricted securities and private placements (debt and equity) where observable inputs may be limited, assumptions about market activity and risk are used and such securities are categorized as either Level 2 or Level 3 in the hierarchy depending on the relative significance of valuation inputs.
Debt securities, other than venture capital debt securities, are valued based on evaluated prices received from independent pricing services or from dealers who make markets in such securities.
Exchange-traded funds are valued at the official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy.
Short-term securities of sufficient credit quality with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates fair value, and are categorized as Level 2 in the hierarchy.
Mutual funds are valued at their closing net asset value each business day and are categorized as Level 1 in the hierarchy.
If a market value cannot be determined for a security using the methodologies described above, or if, in the good faith opinion of the Adviser, the market value does not constitute a readily available market quotation, or if a significant event has occurred that would materially affect the value of the security, the security will be fair valued as determined in good faith by the Valuation Committee.
The Valuation Committee considers a number of factors, including significant unobservable valuation inputs when arriving at fair value. It considers all significant facts that are reasonably available and relevant to the determination of fair value.
The Valuation Committee primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. When more appropriate, the Fund may employ an income-based or cost approach. An income-based valuation approach discounts anticipated future cash flows of the investment to calculate a present amount (discounted). The measurement is based on the value indicated by current market expectations about those future amounts. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. A cost-based approach is based on the amount that currently would be required to replace the service capacity of an asset (current replacement cost). From the seller’s perspective, the price that would be received for the asset is determined based on the cost to a buyer to acquire or construct a substitute asset of comparable utility, adjusted for obsolescence.
The values assigned to fair value investments are based on available information and do not necessarily represent amounts that might ultimately be realized. Further, due to the inherent uncertainty of valuations of such investments, the fair values may differ
22 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
significantly from the values that would have been used had an active market existed, and the differences could be material. The Valuation Committee employs various methods for calibrating these valuation approaches including a regular review of key inputs and assumptions, transactional back-testing or disposition analysis and reviews of any related market activity.
The following table summarizes the market value of the Fund's holdings as of March 31, 2017, based on the inputs used to value them:
VALUATION INPUTS | |||||||||||||
INVESTMENTS IN SECURITIES | LEVEL 1 | LEVEL 2 | LEVEL 3 | TOTAL | |||||||||
Common Stocks | |||||||||||||
Canada | $5,438,780 | $— | $— | $5,438,780 | |||||||||
Ireland | 5,607,717 | 9,511,759 | — | 15,119,476 | |||||||||
Kenya | 1,136,454 | — | — | 1,136,454 | |||||||||
Taiwan | 3,652,695 | — | — | 3,652,695 | |||||||||
United Kingdom | 3,316,493 | 40,530,873 | — | 43,847,366 | |||||||||
Other Countries* | — | 151,583,420 | — | 151,583,420 | |||||||||
Total Common Stocks | $19,152,139 | $201,626,052 | ** | $— | $220,778,191 | ||||||||
Preferred Stocks - Venture Capital | — | — | 206,716 | 206,716 | |||||||||
Exchange-Traded Funds | 6,953,633 | — | — | 6,953,633 | |||||||||
Venture Capital Limited Partnership Interest | — | — | 1,287,307 | 1,287,307 | |||||||||
Venture Capital Debt Obligations | — | — | 501,487 | 501,487 | |||||||||
High Social Impact Investments | — | 4,147,031 | 461,820 | 4,608,851 | |||||||||
Other | — | — | — | — | |||||||||
Time Deposit | — | 2,360,596 | — | 2,360,596 | |||||||||
Short Term Investment of Cash Collateral For Securities Loaned | 5,707,554 | — | — | 5,707,554 | |||||||||
TOTAL | $31,813,326 | $208,133,679 | $2,457,330^ | $242,404,335 | |||||||||
* For further breakdown of equity securities by country, please refer to the Schedule of Investments. Venture Capital is not included in this category. | |||||||||||||
** Includes certain securities trading primarily outside the U.S. where the value was adjusted as a result of significant market movements following the close of local trading. | |||||||||||||
^ Level 3 securities represent 1.0% of net assets. |
There were no transfers between Level 1 and Level 2 during the six months ended March 31, 2017.
Restricted Securities: The Fund may invest in securities that are subject to legal or contractual restrictions on resale. Generally, these securities may only be sold publicly upon registration under the Securities Act of 1933 or in transactions exempt from such registration. Information regarding restricted securities is included at the end of the Schedule of Investments.
Security Transactions and Investment Income: Security transactions are accounted for on trade date. Realized gains and losses are recorded on an identified cost basis and may include proceeds from litigation. Dividend income is recorded on the ex-dividend date or, in the case of dividends on certain foreign securities, as soon as the Fund is informed of the ex-dividend date. Withholding taxes on foreign dividends have been provided for in accordance with the Fund’s understanding of the applicable country’s tax rules and rates. Distributions received that represent a return of capital are recorded as a reduction of cost of investments. Distributions received that represent a capital gain are recorded as a realized gain. Interest income, which includes amortization of premium and accretion of discount on debt securities, is accrued as earned.
Share Class Accounting: Investment income and realized and unrealized gains and losses are allocated to separate classes of shares based upon the relative net assets of each class. Expenses common to the classes are also allocated to each class in proportion to their relative net assets. Expenses arising in connection with a specific class are charged directly to that class.
Foreign Currency Transactions: The Fund’s accounting records are maintained in U.S. dollars. For valuation of assets and liabilities on each date of net asset value determination, foreign denominations are converted into U.S. dollars using the current exchange rate. Security transactions, income, and expenses are translated at the prevailing rate of exchange on the date of the event. Recognized gains or losses on investment transactions attributable to changes in foreign currency exchange rates are recorded for financial statement purposes as net realized gains and losses on investments. That portion of unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed.
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Distributions to Shareholders: Distributions to shareholders are recorded by the Fund on ex-dividend date. Dividends from net investment income and distributions from net realized capital gains, if any, are paid at least annually. Distributions are determined in accordance with income tax regulations which may differ from U.S. GAAP; accordingly, periodic reclassifications are made within the Fund's capital accounts to reflect income and gains available for distribution under income tax regulations.
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 and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.
Federal Income Taxes: No provision for federal income or excise tax is required since the Fund intends to continue to qualify as a regulated investment company under the Internal Revenue Code and to distribute substantially all of its taxable earnings.
Management has analyzed the Fund's tax positions taken for all open federal income tax years and has concluded that no provision for federal income tax is required in the Fund's financial statements. A Fund's federal tax return is subject to examination by the Internal Revenue Service for a period of three years.
Interim Financial Statements: The interim financial statements relating to March 31, 2017 and for the six months then ended have not been audited by an independent registered public accounting firm, but in the opinion of the Fund’s management, reflect all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the financial statements.
NOTE B — RELATED PARTY TRANSACTIONS
Effective December 31, 2016, Calvert Research and Management (CRM), a subsidiary of Eaton Vance Management (EVM), became the investment adviser to the Fund following a transaction between CRM and certain of its affiliates and Calvert Investment Management, Inc. (CIM) and certain of its affiliates, pursuant to which CRM acquired substantially all of the business assets of CIM after satisfying various closing conditions, including shareholder approval of a new investment advisory agreement between the Fund and CRM (the “Transaction”).
For its services pursuant to the new investment advisory agreement, CRM receives a fee, payable monthly, at the annual rate of 0.75% of the Fund's average daily net assets up to and including $250 million and 0.725% over $250 million up to and including $500 million. On net assets over $500 million, the annual fee is reduced. Pursuant to a sub-advisory agreement effective December 31, 2016, CRM pays Eaton Vance Management (International) Limited (EVMI), an indirect, wholly-owned subsidiary of Eaton Vance Corp., a portion of its investment advisory fee for sub-advisory services provided to the Fund. Prior to December 31, 2016, CIM, a direct subsidiary of Calvert Investments, Inc. and an indirect subsidiary of Ameritas Holding Company, provided investment advisory services to the Fund. For its services, CIM received a fee at the same annual rate as the Fund’s investment advisory agreement with CRM. For the six months ended March 31, 2017, the investment advisory fee amounted to $1,051,659 or 0.75% (annualized), of which $468,450 was paid to CRM and $583,209 was paid to CIM.
CRM and EVMI have agreed to reimburse the Fund’s operating expenses to the extent that total annual operating expenses (relating to ordinary operating expenses only and excluding expenses such as brokerage commissions, acquired fund fees and expenses of unaffiliated funds, interest expense, taxes or litigation expenses) exceed 1.33%, 2.08%, 0.95% and 1.08% for Class A, Class C, Class I and Class Y, respectively, of such class’ average daily net assets. The expense reimbursement agreement may be changed or terminated after January 31, 2018. Prior to December 31, 2016, CIM contractually agreed to limit net annual fund operating expenses to 1.38%, 2.14%, 0.95% and 1.13% for Class A, Class C, Class I and Class Y, respectively, of such class’ average daily net assets. For the six months ended March 31, 2017, CRM and EVMI waived or reimbursed in total expenses of $160,757 and CIM waived or reimbursed expenses of $102,455.
The administrative fee is earned by CRM as compensation for administrative services rendered to the Fund. The fee is computed at an annual rate of 0.12% of the Fund’s average daily net assets and is payable monthly. Prior to December 31, 2016, Calvert Investment Administrative Services, Inc. (CIAS), an affiliate of CIM, provided administrative services to the Fund at an annual rate of 0.12% of the Fund's average daily net assets, payable monthly. For the six months ended March 31, 2017, CRM was paid administrative fees of $70,055 and CIAS was paid administrative fees of $93,952.
The Fund adopted a new distribution plan for Class A shares (Class A Plan) and Class C shares (Class C Plan) pursuant to Rule 12b-1 under the 1940 Act, which were approved by the Board of Directors and became effective as of December 31, 2016 or shortly thereafter upon approval by the shareholders of the respective class. Pursuant to the Class A Plan and Class C Plan, the Fund pays a distribution fee of 0.25% and 0.75% per annum for Class A and Class C, respectively, and a service fee of 0.25% per annum for Class C of its average daily net assets attributable to such class for distribution services and facilities provided to the Fund, as well as for personal and/or account maintenance services provided. Pursuant to the Fund’s former distribution plans for Class A shares and Class C shares, the Fund was permitted to pay certain expenses associated with the distribution and servicing of its Class A and Class C shares not to exceed 0.35% for Class A and 1.00% for Class C of the Fund’s average daily net assets
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with respect to such class. Effective December 31, 2016, the fees are paid to Eaton Vance Distributors, Inc. (EVD), an affiliate of CRM and the Fund’s principal underwriter. Prior to December 31, 2016, the fees were paid to Calvert Investment Distributors, Inc. (CID), an affiliate of CIM and the Fund’s former distributor and principal underwriter. Distribution and service fees paid or accrued for the six months ended March 31, 2017 amounted to $171,474 or 0.25% per annum of Class A’s average daily net assets, of which $80,121 was paid to EVD and $91,353 was paid to CID, and $63,514 or 1.00% per annum of Class C’s average daily net assets, of which $31,345 was paid to EVD and $32,169 was paid to CID.
The Fund was informed that EVD and CID received $5,206 and $3,865, respectively, as their portion of the sales charge on sales of Class A shares for the six months ended March 31, 2017. The Fund was also informed that EVD and CID received $200 and $846, respectively, of contingent deferred sales charges paid by Fund shareholders for the same period.
Effective December 31, 2016, EVM provides sub-transfer agency services to the Fund pursuant to a Sub-Transfer Agency Support Services Agreement. For its services, EVM receives an annual fee of $8 per shareholder account. Prior to December 31, 2016, Calvert Investment Services, Inc. (CIS), an affiliate of CIM, acted as the shareholder servicing agent for the Fund and received a fee at the same rate as is paid to EVM. For the six months ended March 31, 2017, sub-transfer agency fees paid to EVM were $20,467 and shareholder servicing fees paid to CIS were $21,597. Such fees are included in transfer agency fees and expenses on the Statement of Operations.
Each Director of the Fund who is not an employee of CRM or its affiliates receives a fee of $3,000 for each Board meeting attended in person and $2,000 for each Board meeting attended by phone plus an annual fee of $52,000, and $1,500 for each Committee meeting attended in person and $1,000 for each Committee meeting attended by phone plus an annual Committee fee of $2,500. The Board chair receives an additional $10,000 annual retainer and Committee chairs receive an additional $6,000 annual retainer. Prior to December 31, 2016, each Director of the Fund who was not an employee of CIM or its affiliates received a fee of $3,000 for each Board meeting attended plus an annual fee of $52,000. Committee members received $500 for each Committee meeting attended plus an annual fee of $2,500. Committee chairs received an additional annual retainer ranging from $6,000 to $10,000. Eligible Directors may participate in a Deferred Compensation Plan (the “Plan”). Amounts deferred under the Plan are treated as though equal dollar amounts had been invested in shares of the Fund or other Calvert funds selected by the Directors. The Fund purchases shares of the funds selected equal to the dollar amounts deferred under the Plan, resulting in an asset equal to the deferred compensation liability. Obligations of the Plan are paid solely from the Fund’s assets. Directors’ fees are allocated to each of the Calvert funds served. Salaries and fees of officers and Directors of the Fund who are employees of CRM and, prior to December 31, 2016, of CIM or their affiliates are/were paid by CRM and CIM, respectively. In addition, in connection with the Transaction, an advisory council was established to aid the Board and the Calvert funds’ Adviser in advancing the cause of responsible investing through original scholarship and thought leadership. The advisory council consists of the Adviser’s Chief Executive Officer and four additional members. Each member (other than the Adviser’s Chief Executive Officer) receives annual compensation of $75,000, which will be reimbursed by CIM and Ameritas Holding Company for a period of up to three years.
NOTE C — INVESTMENT ACTIVITY AND TAX INFORMATION
During the six months ended March 31, 2017, the cost of purchases and proceeds from sales of investments, other than short-term securities, were $277,565,192 and $378,070,068, respectively.
At September 30, 2016, the Fund, for federal income tax purposes, had the following capital loss carryforwards which would reduce the Fund’s taxable income arising from future net realized gains on investment transactions, if any, to the extent permitted by the Internal Revenue Code, and thus would reduce the amount of distributions to shareholders, which would otherwise be necessary to relieve the Fund of any liability for federal income or excise tax.
Capital Loss Carryforwards | |||
EXPIRATION DATE | |||
2017 | ($19,653,830 | ) | |
2018 | (105,942,268 | ) | |
2019 | (10,386,632 | ) |
Under the Regulated Investment Company Modernization Act of 2010, capital losses incurred in taxable years beginning after December 22, 2010 can be carried forward to offset future capital gains for an unlimited period. These losses are required to be utilized prior to the losses incurred in pre-enactment taxable years and will retain their character as either long-term or short-term. Losses incurred in pre-enactment taxable years can be utilized until expiration. The Fund's use of net capital losses acquired from reorganizations may be limited under certain tax provisions.
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The cost and unrealized appreciation (depreciation) of investments of the Fund at March 31, 2017, as determined on a federal income tax basis, were as follows:
Unrealized appreciation | $12,963,443 | ||
Unrealized (depreciation) | (8,369,417 | ) | |
Net unrealized appreciation (depreciation) | $4,594,026 | ||
Federal income tax cost of investments | $237,810,309 |
NOTE D — SECURITIES LENDING
To generate additional income, the Fund may lend its securities pursuant to a securities lending agency agreement (“Lending Agreement”) with State Street Bank, the securities lending agent. Security loans are subject to termination by the Fund at any time and, therefore, are not considered to be illiquid investments. The Fund requires that the loan be continuously collateralized by either cash or securities as collateral equal at all times to at least 102% of the market value of the domestic securities loaned and 105% of the market value of the international securities loaned (if applicable). Cash collateral is generally invested in State Street Institutional U.S. Government Money Market Fund (the “U.S. Government Fund”) that is managed by an affiliate of the custodian. The U.S. Government Fund is a registered money market fund that invests in a variety of high-quality, U.S. dollar denominated instruments. Any gain or loss in the market price of the loaned securities that might occur and any interest earned or dividends declared during the term of the loan would accrue to the account of the Fund. Income earned on the investment of collateral, net of broker rebates and other expenses incurred by the securities lending agent, is split between the Fund and the securities lending agent on the basis of agreed upon contractual terms.
The risks associated with lending portfolio securities include, but are not limited to, possible delays in receiving additional collateral or in the recovery of the loaned securities, possible loss of rights to the collateral should the borrower fail financially, as well as risk of loss in the value of the collateral or the value of the investments made with the collateral. The securities lending agent shall indemnify the Fund in the case of default of any securities borrower.
The total value of securities on loan was $5,163,831 as of March 31, 2017.
The following table displays a breakdown of transactions accounted for as secured borrowings, the obligations by class of collateral pledged, and the remaining contractual maturity of those transactions as of March 31, 2017.
Remaining Contractual Maturity of the Agreements as of March 31, 2017 | |||||||||
Overnight and Continuous | <30 days | Between 30 & 90 days | >90 days | Total | |||||
Securities Lending Transactions | |||||||||
Common Stocks | $5,707,554 | $— | $— | $— | $5,707,554 | ||||
Amount of recognized liabilities for securities lending transactions | $5,707,554 |
The carrying amount of the liability for collateral for securities loaned at March 31, 2017 approximated its fair value. If measured at fair value, such liability would have been considered as Level 2 in the fair value hierarchy (see Note A) at March 31, 2017.
NOTE E — LINE OF CREDIT
A financing agreement is in place with the Calvert Funds and State Street Bank and Trust Company (SSB). Under the agreement, which expires on August 8, 2017, SSB provides an unsecured line of credit facility, in the aggregate amount of $50 million ($25 million committed and $25 million uncommitted), accessible by the Calvert Funds for temporary or emergency purposes only. Borrowings bear interest at the higher of the One-Month London Interbank Offered Rate (LIBOR) in effect that day or the overnight Federal Funds Rate plus 1.25% per annum. A commitment fee of 0.25% per annum is incurred on the unused portion of the committed facility. An administrative fee of $30,000 was paid in connection with the uncommitted facility. These fees are allocated to all participating funds. Because the line of credit is not available exclusively to the Fund, it may be unable to borrow some or all of its requested amounts at any particular time. The Fund had no loans outstanding pursuant to this line of credit at March 31, 2017.
For the six months ended March 31, 2017, borrowing information by the Fund under the agreement was as follows:
Average Daily Balance | Weighted Average Interest Rate | Maximum Amount Borrowed | Month of Maximum Amount Borrowed |
$1,135,718 | 1.99% | $28,600,000 | January 2017 |
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NOTE F — CAPITAL SHARES
At March 31, 2017, Calvert Conservative Allocation Fund, Calvert Moderate Allocation Fund and Calvert Aggressive Allocation Fund owned in the aggregate 20.9% of the value of the outstanding shares of the Fund.
NOTE G — AFFILIATED COMPANIES
The Fund invests a portion of its assets designated for high social impact investments in notes issued by the Calvert Social Investment Foundation (the “Foundation”) pursuant to an exemptive order granted by the U.S. Securities and Exchange Commission (the “SEC”). The Fund relies on exemptive relief to invest in the notes because the Fund’s investments in the notes may be considered prohibited transactions between affiliated persons under the 1940 Act. The Foundation may be considered an affiliated person of the Calvert Funds based on the overlap between the Foundation’s Board of Directors and the Funds’ Directors/Trustees and other potential affiliations. The Foundation has licensed use of the Calvert name from the Adviser, and the Adviser’s President and Chief Executive Officer serves on the Foundation Board. The Foundation is not owned or otherwise controlled by the Adviser or its affiliates.
In addition, an affiliated company is a company in which a fund has a direct or indirect ownership of, control of, or voting power of 5 percent or more of the outstanding voting shares, or a company that is under common ownership or control with a fund. Transactions in affiliated companies by the Fund for the six months ended March 31, 2017 were as follows:
Name of Affiliated Company | Principal Amount, beginning of period | Gross Additions | Gross Reductions | Principal Amount, end of period | Value, end of period | Interest Income | Net Realized Gain (Loss) | Capital Gain Distributions Received | Change In Unrealized Appreciation (Depreciation) | |||||||||||||||
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 | $4,431,583 | $— | $— | $4,431,583 | $4,147,031 | $19,757 | $— | $— | ($284,552 | ) | ||||||||||||||
Calvert Social Investment Foundation, Community Investment Notes, 0.25%, 7/1/17 | 4,431,583 | — | (4,431,583 | ) | — | — | 2,255 | — | — | 124,749 | ||||||||||||||
SEAF Central and Eastern European Growth Fund LLC | — | — | (130,377 | ) | — | 69,489 | — | — | — | (64,182 | ) | |||||||||||||
gNet Defta Development Holding LLC | — | — | — | — | 295,471 | — | — | — | (4,545 | ) | ||||||||||||||
TOTALS | $4,511,991 | $22,012 | $— | $— | ($228,530 | ) |
NOTE H — RISKS ASSOCIATED WITH FOREIGN INVESTMENTS
Investing in foreign securities involves additional risks relating to political, social, and economic developments abroad. Other risks result from differences between regulations that apply to U.S. and foreign issuers and markets, and the potential for foreign markets to be less liquid and more volatile than U.S. markets. Securities that trade or are denom2inated in currencies other than the U.S. dollar may be adversely affected by fluctuations in currency exchange rates.
The risks of investing in emerging market securities are greater than those of investing in securities of developed foreign countries. These risks include volatile currency exchange rates, periods of high inflation, increased risk of default, greater social, economic and political uncertainty and instability, less governmental supervision and regulation of securities markets, weaker auditing and financial reporting standards, lack of liquidity in the markets, and the significantly smaller market capitalizations of emerging market issuers.
NOTE I — CAPITAL COMMITMENTS
In connection with certain venture capital and/or limited partnership investments, the Fund is committed to future capital calls, which will increase the Fund’s investment in these securities. The aggregate amount of the future capital commitments totaled $433,497 at March 31, 2017. The Fund had sufficient cash and/or securities to cover these commitments.
The Fund's unfunded capital commitments by investment at March 31, 2017 were as follows:
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Name of Investment | Unfunded Commitment at 3/31/17 | ||
Africa Renewable Energy Fund LP | $364,312 | ||
BFSE Holding, BV LP | 503 | ||
Blackstone Clean Technology Partners LP | 508 | ||
China Environment Fund 2004 LP | 37,764 | ||
Terra Capital LP | 30,410 | ||
Total | $433,497 |
NOTE J - REGULATORY MATTERS
On October 18, 2016, CIM announced that it had determined that certain fees paid to third-party financial intermediaries were incorrectly allocated for payment by, and paid by, the Calvert Funds. Specifically, for periods prior to January 1, 2015, the Calvert Funds paid fees under certain intermediary agreements that were primarily for distribution-related services or were in excess of the sub-transfer agency expense cap in place during the period and therefore should have been paid by CIM out of CIM’s own assets or by the Calvert Funds under a Rule 12b-1 plan. The matter was self-reported to the SEC in 2016.
On May 2, 2017, in acceptance of a settlement proposal by CIM and CID, the SEC issued an administrative order requiring CIM and CID to pay $21,614,534 to affected shareholders of the Calvert Funds, including the Fund. The administrative order also censured CIM and CID and required them to pay a $1 million penalty to the SEC. CIM is in the process of determining the economic impact of misallocated fees on the affected Calvert Funds, including the Fund, and their shareholders, and developing a plan to reimburse eligible shareholders following that determination.
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SPECIAL MEETING OF SHAREHOLDERS (UNAUDITED)
The Special Meeting of Shareholders of Calvert International Equity Fund, a series of Calvert World Values Fund, Inc. (the “Fund”) was held on December 16, 2016, and adjourned to December 23, 2016, December 28, 2016, January 6, 2017, January 27, 2017 and February 15, 2017.
Shareholders of the Fund voted on the following proposals:
1. | Approval of a new investment advisory agreement with Calvert Research and Management. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
12,134,071 | 196,788 | 384,278 | 2,280,957 |
2. | Approval of a new investment sub-advisory agreement with Eaton Vance Management (International) Limited. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
12,106,667 | 197,598 | 410,871 | 2,280,959 |
3. | Reaffirmation and approval of the Fund’s ability to invest in notes issued by Calvert Social Investment Foundation. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
12,193,076 | 168,227 | 353,834 | 2,280,958 |
4. | Approval of the Fund’s reliance on a potential future exemptive order that may be granted by the U.S. Securities and Exchange Commission. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
13,192,916 | 230,852 | 588,743 | 2,029,466 |
Shareholders of Class A shares of the Fund voted on the following proposal:
1. | Approval of Master Distribution Plan for Class A shares of the Fund pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
4,297,800 | 129,232 | 308,778 | 1,639,657 |
Shareholders of Class C shares of the Fund voted on the following proposal:
1. | Approval of Master Distribution Plan for Class C shares of the Fund pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
457,557 | 11,863 | 46,483 | 139,313 |
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Shareholders of Calvert World Values Fund, Inc. voted on the following proposal:
1. | To elect Directors of Calvert World Values Fund, Inc.: |
Number of Shares* | ||
Nominee | For | Withheld |
Richard L. Baird, Jr. | 39,776,422 | 1,439,396 |
Alice Gresham Bullock | 39,831,328 | 1,384,490 |
Cari Dominguez | 39,839,990 | 1,375,828 |
Miles D. Harper III | 39,768,678 | 1,447,140 |
John G. Guffey, Jr. | 39,771,630 | 1,444,188 |
Joy V. Jones | 39,842,813 | 1,373,004 |
Anthony A. Williams | 35,278,280 | 5,937,538 |
John H. Streur | 39,768,579 | 1,447,239 |
* | Excludes fractional shares. |
** | Uninstructed shares (i.e., proxies from brokers or nominees indicating that such persons have not received instructions from the beneficial owner or other person entitled to vote shares on a particular matter with respect to which the brokers or nominees do not have discretionary power) were treated as shares that were present at the meeting for purposes of establishing a quorum, but had the effect of a vote against the proposals. Uninstructed shares are sometimes referred to as broker non-votes. Abstentions were also treated in this manner. |
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BOARD APPROVAL OF INVESTMENT ADVISORY AGREEMENT
Calvert International Equity Fund
At a meeting held on October 14, 2016, the Board of Directors of Calvert World Values Fund, Inc. (“CWVF”), and by a separate vote, the Directors who are not “interested persons” of CWVF (the “Independent Directors”), approved a new Investment Advisory Agreement between CWVF and Eaton Vance Investment Advisors (renamed Calvert Research and Management) (“CRM” or the “Adviser”) and a new Investment Sub-Advisory Agreement between the Adviser and Eaton Vance Management (International) Limited (the “Sub-Adviser”), each with respect to the Calvert International Equity Fund (the “Fund”). The Board was advised that, subject to shareholder approval and certain other conditions, the new Investment Advisory and Investment Sub-Advisory Agreements would take effect upon the acquisition of substantially all of the business assets of Calvert Investment Management, Inc. (“CIM”) by Eaton Vance Corporation (“Eaton Vance”) (the “Transaction”).
In connection with the proposed Transaction, the Independent Directors, assisted by their independent legal counsel, requested extensive information from CIM and Eaton Vance regarding the proposed Transaction and its potential implications for the Calvert Funds. The Independent Directors also received information from the Sub-Adviser concerning the services to be provided to the Fund. The Independent Directors reviewed and discussed this information and received advice from their independent legal counsel regarding their responsibilities in evaluating the possible Transaction and the new Investment Advisory and Investment Sub-Advisory Agreements.
The Independent Directors met separately on multiple occasions to discuss the Transaction and the proposed change in investment adviser. The interested Directors participated in portions of these meetings to provide the perspective of the Calvert organization, but did not otherwise participate in the deliberations of the Independent Directors regarding the possible change in investment adviser.
In the course of their deliberations regarding the new Investment Advisory Agreement, the Directors considered the following factors, among others: the nature, extent and quality of the services to be provided by CRM and its affiliates, including the personnel who would be providing such services; Eaton Vance’s financial condition; the proposed advisory fees; comparative fee and expense information for the Calvert Funds and for comparable funds managed by Eaton Vance or its affiliates; the anticipated profitability of the Calvert Funds to CRM and its affiliates; the direct and indirect benefits, if any, to be derived by CRM and its affiliates from their relationship with the Calvert Funds; the effect of each Calvert Fund's projected growth and size on each Calvert Fund's performance and expenses; and CRM’s compliance program.
In considering the nature, extent, and quality of the services to be provided to the Fund by CRM under the new Investment Advisory Agreement, the Directors took into account information provided by Eaton Vance or its affiliates relating to its operations and personnel, including, among other information, biographical information on its supervisory and professional staff and descriptions of its organizational and management structure. The Directors considered the new investment strategies to be used in managing certain Calvert Funds and the performance of other funds managed by the investment teams at Eaton Vance or its affiliates that would be managing certain Calvert Funds. The Directors also took into account CRM’s and Eaton Vance’s proposed staffing and overall resources, and noted that the staff of CRM was expected to include certain current employees of CIM as well as certain employees of affiliates of Eaton Vance under a “dual-hat” arrangement. CRM’s administrative capabilities were also considered. The Directors concluded that they were satisfied with the nature, extent and quality of services to be provided to the Fund by CRM under the new Investment Advisory Agreement.
In considering the Fund’s performance, the Board noted that it reviewed on a quarterly basis detailed information about the Fund’s performance results, portfolio composition and investment strategies. The Board also reviewed various comparative data provided to it in connection with its consideration of the new Investment Advisory and Investment Sub-Advisory Agreements, including, comparisons of the Fund’s returns with those of its benchmark and the average of its Lipper category for the one-, three- and five-year periods ended July 31, 2016.
In considering the Fund’s proposed fees and estimated expenses, the Directors considered certain comparative fee and expense data provided by Eaton Vance or its affiliates. The Directors also took into account that there were no increases in the advisory fees being proposed and that for certain Calvert Funds, CRM had proposed a reduction in advisory fees. The Directors further noted that CRM had agreed to maintain current fee waivers/expense reimbursements, if any, for certain Calvert Funds, and increase the fee waivers/expense reimbursements for other Calvert Funds, such as the Fund. Based upon their review the Directors concluded that the proposed advisory fee was reasonable in view of the quality of services to be received by the Fund from CRM.
In reviewing the anticipated profitability of the Fund to CRM and its affiliates, the Directors considered the fact that affiliates of CRM would be providing sub-advisory, shareholder servicing, administrative and distribution services to the Fund for which they would receive compensation. The Board also took into account whether CRM had the financial wherewithal to provide services to the Fund. The Board also considered that CRM would likely derive benefits to its reputation and other indirect benefits from its
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relationship with the Fund. Based upon its review, the Board concluded that CRM’s and its affiliates’ anticipated level of profitability from their relationship with the Fund was reasonable.
The Directors considered the effect of each Calvert Fund’s current size and potential growth on its performance and expenses. The Directors took into account management’s discussion of the Calvert Funds’ proposed advisory and sub-advisory fees. The Directors noted that the advisory fee schedule for certain Calvert Funds, such as the Fund, will contain breakpoints that will reduce the respective advisory fee rate on assets above specified levels as the applicable Calvert Fund’s assets increased and considered the necessity of adding breakpoints with respect to the Calvert Funds that did not currently have such breakpoints in their advisory fee schedule. The Directors determined that adding breakpoints at specified levels to the advisory fee schedules of the Calvert Funds that did not currently have breakpoints, would not be appropriate at this time. The Directors noted that if the Fund’s assets increased over time, the Fund might realize economies of scale if assets increase proportionally more than certain other expenses.
In considering the approval of the new Investment Advisory Agreement, the Directors also considered the following matters:
(i) their belief that the Transaction will benefit the Calvert Funds, including the Fund;
(ii) the continued management of the Fund in a manner materially consistent with the Fund’s existing investment objective and principal investment strategies, which includes continuing to manage the Fund pursuant to responsible investment criteria;
(iii) the financial condition and reputation of Eaton Vance and its affiliates, its worldwide presence, experience as a fund sponsor and manager, commitment to maintain a high level of cooperation with, and support to, the Calvert Funds, including the Fund, strong distribution and client service capabilities, and relationships in the asset management industry;
(iv) the intention expressed by representatives of Eaton Vance to retain certain of the existing members of the Calvert management team and other key professionals, including members of the Calvert Sustainability Research Department, in order to better continue principles-based investment research following the closing of the Transaction;
(v) Eaton Vance’s commitment to maintaining competitive compensation arrangements to attract and retain highly qualified personnel; and
(vi) that the current senior management team at Calvert has indicated its strong support of the Transaction.
In approving the new Investment Advisory Agreement with CRM, the Directors did not identify any single factor as controlling, and each Director may have attributed different weight to various factors.
The Directors reached the following conclusions regarding the new Investment Advisory Agreement, among others: (a) CRM has demonstrated that it possesses the capability and resources to perform the duties required of it under the Investment Advisory Agreement and (b) the advisory fees are reasonable in view of the quality of the services to be received by the Fund from CRM. Based on the foregoing considerations, the Directors, including the Independent Directors, approved the new Investment Advisory Agreement, subject to the approval of the Fund’s shareholders.
In connection with the proposed Transaction, the Board determined that it would be in the Fund’s best interests to appoint the Sub-Adviser, an affiliate of CRM, as a new sub-adviser to the Fund effective upon the closing of the Transaction. The Board reviewed and discussed information provided by the Sub-Adviser and received advice from their independent legal counsel regarding their responsibilities in evaluating the proposed Transaction and the new Investment Sub-Advisory Agreement.
In evaluating the new Investment Sub-Advisory Agreement, the Directors considered information provided by Eaton Vance or its affiliates relating to the Sub- Adviser’s operations, personnel, investment philosophy, strategies, and techniques. Among other information, Eaton Vance or its affiliates provided biographical information on portfolio management and other professional staff, performance information for itself, and descriptions of its investment philosophies, strategies and techniques, organizational and management structures, and brokerage policies and practices.
In the course of their deliberations concerning the new Investment Sub-Advisory Agreement, the Directors evaluated, among other factors: the nature, extent and the quality of the services to be provided by the Sub-Adviser; the Sub-Adviser’s management style and long-term performance record; the Fund’s performance record and the Sub-Adviser’s performance in executing its investment strategies; the Sub-Adviser’s current level of staffing and its overall resources; the qualifications and experience of the Sub-Adviser’s personnel; and the Sub-Adviser’s financial condition with respect to its ability to perform the services required under the new Investment Sub-Advisory Agreement. The Directors also considered materials provided by Eaton Vance, including: (1) an explanation of the basis for recommending that the Sub-Adviser serve as sub-adviser to the Fund, (2) a description of the investment professionals who would manage the Fund, (3) a description of the investment strategy and investment process to be used in managing the Fund, and (4) performance information for comparable funds. Based upon their
32 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
review, the Directors concluded that they were satisfied with the nature, extent and quality of services proposed to be provided to the Fund by the Sub-Adviser under the new Investment Sub-Advisory Agreement.
In considering the cost of services to be provided by the Sub-Adviser and the profitability to the Sub-Adviser of its relationship with the Fund, the Directors noted that CRM would pay the sub-advisory fees to the Sub-Adviser out of its advisory fee. Based upon their review, the Directors determined that the proposed sub-advisory fee was reasonable in view of the quality of services to be received by the Fund from the Sub-Adviser. Because CRM would pay the Sub-Adviser’s sub-advisory fees, the cost of services provided by the Sub-Adviser and the profitability to the Sub-Adviser of its relationship with the Fund were not material factors in the Board’s deliberations. For similar reasons, the Board did not consider the potential economies of scale in the Sub-Adviser’s management of the Fund to be a material factor in its consideration.
In approving the new Investment Sub-Advisory Agreement, the Directors did not identify any single factor as controlling, and each Director may have attributed different weight to various factors.
The Directors reached the following conclusions regarding the new Investment Sub-Advisory Agreement, among others: (a) the Sub-Adviser is qualified to manage the Fund’s assets in accordance with the Fund’s investment objectives and policies; (b) the Sub-Adviser is likely to execute its investment strategies consistently over time; and (c) the proposed sub-advisory fees are reasonable in view of the quality of services to be received by the Fund from the Sub-Adviser. Based upon the foregoing considerations, the Directors, including the Independent Directors, approved the new Investment Sub-Advisory Agreement, subject to approval of the Fund's shareholders.
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OFFICERS AND TRUSTEES
Officers of Calvert International Equity Fund
Hope Brown
Chief Compliance Officer
Maureen A. Gemma(1)
Secretary and Vice President
James F. Kirchner(1)
Treasurer
Directors of Calvert International Equity Fund
Alice Gresham Bullock(2)(4)
Chairperson
Richard L. Baird, Jr.(4)
Cari Dominguez(2)(4)
John G. Guffey, Jr.(4)
Miles D. Harper, III(4)
Joy V. Jones(4)
John H. Streur(3)
Anthony A. Williams(2)(4)
(1)Ms. Gemma and Mr. Kirchner began serving as Officers effective December 31, 2016.
(2)Mmes. Bullock and Dominguez and Mr. Williams began serving as Directors effective December 23, 2016.
(3)Interested Director and President
(4)Independent Director
34 calvert.com CALVERT INTERNATIONAL EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
IMPORTANT NOTICES
Privacy. The Calvert organization is committed to ensuring your financial privacy. Each of the financial institutions identified below has in effect the following policy (“Privacy Policy”) with respect to nonpublic personal information about its customers:
• | Only such information received from you, through application forms or otherwise, and information about your Calvert fund transactions will be collected. This may include information such as name, address, social security number, tax status, account balances and transactions. |
• | None of such information about you (or former customers) will be disclosed to anyone, except as permitted by law (which includes disclosure to employees necessary to service your account). In the normal course of servicing a customer’s account, the Calvert organization may share information with unaffiliated third parties that perform various required services such as transfer agents, custodians and broker-dealers. |
• | Policies and procedures (including physical, electronic and procedural safeguards) are in place that are designed to protect the confidentiality of such information. |
• | We reserve the right to change our Privacy Policy at any time upon proper notification to you. Customers may want to review our Privacy Policy periodically for changes by accessing the link on our homepage: www.Calvert.com. |
Our pledge of privacy applies to the following entities within the Calvert organization: the Calvert Family of funds and Calvert Research and Management. In addition, our Privacy Policy applies only to those Calvert customers who are individuals and who have a direct relationship with us. If a customer’s account (i.e., fund shares) is held in the name of a third-party financial adviser/broker-dealer, it is likely that only such advisor’s privacy policies apply to the customer. This notice supersedes all previously issued privacy disclosures. For more information about Calvert’s Privacy Policy, please call 1-800-368-2745.
Delivery of Shareholder Documents. The Securities and Exchange Commission (SEC) permits funds to deliver only one copy of shareholder documents, including prospectuses, proxy statements and shareholder reports, to fund investors with multiple accounts at the same residential or post office box address. This practice is often called “householding” and it helps eliminate duplicate mailings to shareholders. Calvert funds, or your financial advisor, may household the mailing of your documents indefinitely unless you instruct Calvert funds, or your financial advisor, otherwise. If you would prefer that your Calvert fund documents not be householded, please contact Calvert funds at 1-800-368-2745, or contact your financial advisor. Your instructions that householding not apply to delivery of your Calvert fund documents will typically be effective within 30 days of receipt by Calvert funds or your financial advisor. Separate statements will be generated for each separate account and will be householded as described above.
Portfolio Holdings. Each Calvert fund will file a schedule of portfolio holdings on Form N-Q with the SEC for the first and third quarters of each fiscal year. The Form N-Q will be available on the Calvert funds’ website at www.calvert.com, by calling Calvert funds at 1-800-368-2745 or in the EDGAR database on the SEC’s website at www.sec.gov. Form N-Q may also be reviewed and copied at the SEC’s public reference room in Washington, D.C. (call 1-800-732-0330 for information on the operation of the public reference room).
Proxy Voting. The Proxy Voting Guidelines that each Calvert fund uses to determine how to vote proxies relating to portfolio securities is provided as an Appendix to the fund’s Statement of Additional Information. The Statement of Additional Information can be obtained free of charge by calling the Calvert funds at 1-800-368-2745, by visiting the Calvert funds’ website at www.calvert.com or visiting the SEC’s website at www.sec.gov. Information regarding how a Calvert fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available by calling Calvert funds, by visiting the Calvert funds’ website at www.calvert.com or by visiting the SEC’s website at www.sec.gov.
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CALVERT INTERNATIONAL EQUITY FUND | CALVERT’S FAMILY OF FUNDS | |||
Service for Existing Account Shareholders: 800-368-2745 Brokers: 800-368-2746 Regular Mail Calvert Funds c/o BFDS P.O. Box 219544 Kansas City, MO 64121-9544 Overnight Mail Calvert Funds c/o BFDS 330 West 9th Street Kansas City, MO 64105-1514 Web Site calvert.com Principal Underwriter* Eaton Vance Distributors, Inc. Two International Place Boston, MA 02110 | Municipal Funds Tax-Free Responsible Impact Bond Fund Taxable Bond Funds Bond Portfolio Income Fund Short Duration Income Fund Long-Term Income Fund Ultra-Short Income Fund High Yield Bond Fund Green Bond Fund Unconstrained Bond Fund Balanced and Asset Allocation Funds Balanced Portfolio Conservative Allocation Fund Moderate Allocation Fund Aggressive Allocation Fund | Equity Funds Equity Portfolio U.S. Large Cap Core Responsible Index Fund U.S. Large Cap Value Responsible Index Fund U.S. Large Cap Growth Responsible Index Fund U.S. Mid Cap Core Responsible Index Fund Developed Markets Ex-U.S. Responsible Index Fund Capital Accumulation Fund International Equity Fund Small Cap Fund Global Energy Solutions Fund Global Water Fund International Opportunities Fund Emerging Markets Equity Fund |
* FINRA BrokerCheck. Investors may check the background of their Investment Professional by contacting the Financial Industry Regulatory Authority (FINRA). FINRA BrokerCheck is a free tool to help investors check the professional background of current and former FINRA-registered securities firms and brokers. FINRA BrokerCheck is available by calling 1-800-289-9999 and at www.FINRA.org. The FINRA BrokerCheck brochure describing this program is available to investors at www.FINRA.org.
Fund shares are not insured by the FDIC and are not deposits or other obligations of, or guaranteed by, any depository institution. Shares are subject to investment risks, including possible loss of principal invested. This report is intended to provide fund information to shareholders. It is not authorized for distribution to prospective investors unless preceded or accompanied by a prospectus. Note: The information on our website is not incorporated by reference into this report; our website address is included as an inactive textual reference only. Investors should carefully consider the investment objectives, risks, charges and expenses of the Calvert funds. This and other important information is contained in the fund’s summary prospectus and prospectus, which can be obtained from your financial professional and should be read carefully before investing. You may also call Calvert funds at 800-368-2745. Printed on recycled paper. | |
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Calvert Capital Accumulation Fund | ![]() | |
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Semiannual Report March 31, 2017 E-Delivery Sign-Up — Details Inside | ![]() |
Choose Planet-friendly E-delivery! Sign up now for on-line statements, prospectuses, and fund reports. In less than five minutes you can help reduce paper mail and lower fund costs. Just go to calvert.com. If you already have an online account at Calvert, click on Login, to access your Account, and select the documents you would like to receive via e-mail. If you’re new to online account access, click on Login, then Register to create your user name and password. Once you’re in, click on the E-delivery sign-up on the Account Portfolio page and follow the quick, easy steps. Note: if your shares are not held directly at Calvert but through a brokerage firm, you must contact your broker for electronic delivery options available through their firm. |
PERFORMANCE AND FUND PROFILE
Performance1,2 | ||||||||||||||||
Portfolio Managers Christopher Madden, CFA, Jade Huang and Charles B. Gaffney, each of Calvert Research and Management | ||||||||||||||||
% Average Annual Total Returns | Class Inception Date | Performance Inception Date | Six Months | One Year | Five Years | Ten Years | ||||||||||
Class A at NAV | 10/31/1994 | 10/31/1994 | 8.44 | % | 6.68 | % | 8.28 | 6.85 | % | |||||||
Class A with 4.75% Maximum Sales Charge | — | — | 3.28 | 1.62 | 7.23 | 6.33 | ||||||||||
Class C at NAV | 10/31/1994 | 10/31/1994 | 8.08 | 5.90 | 7.46 | 6.01 | ||||||||||
Class C with 1% Maximum Sales Charge | — | — | 7.08 | 4.90 | 7.46 | 6.01 | ||||||||||
Class I at NAV | 06/03/2003 | 10/31/1994 | 8.63 | 7.08 | 8.88 | 7.59 | ||||||||||
Class Y at NAV | 01/31/2011 | 10/31/1994 | 8.60 | 6.96 | 8.53 | 6.99 | ||||||||||
Russell Midcap® Index | — | — | 8.52 | % | 17.03 | % | 13.08 | % | 7.93 | % | ||||||
Russell Midcap® Growth Index | — | — | 7.38 | % | 14.07 | % | 11.95 | % | 8.13 | % | ||||||
Ticker Symbol | Class A | Class C | Class I | Class Y | ||||||||||||
CCAFX | CCACX | CCPIX | CCAYX | |||||||||||||
% Total Annual Operating Expense Ratios3 | Class A | Class C | Class I | Class Y | ||||||||||||
Gross | 1.32 | % | 2.11 | % | 0.87 | % | 1.04 | % | ||||||||
Net | 1.21 | 1.96 | 0.85 | 0.96 |
Fund Profile | |||||||
SECTOR ALLOCATION (% of total investments)4 | TEN LARGEST STOCK HOLDINGS (% of net assets) | ||||||
Information Technology | 15.9 | % | NXP Semiconductors NV | 2.2 | % | ||
Consumer Discretionary | 14.9 | % | Teleflex, Inc. | 2.2 | % | ||
Industrials | 14.1 | % | AvalonBay Communities, Inc. | 2.2 | % | ||
Financials | 13.7 | % | Interpublic Group of Cos., Inc. (The) | 2.1 | % | ||
Real Estate | 10.0 | % | Amdocs Ltd. | 2.1 | % | ||
Health Care | 8.5 | % | Alleghany Corp. | 2.1 | % | ||
Utilities | 6.6 | % | Ross Stores, Inc. | 2.1 | % | ||
Materials | 5.4 | % | eBay, Inc. | 2.0 | % | ||
Consumer Staples | 5.0 | % | Verisk Analytics, Inc. | 2.0 | % | ||
Energy | 4.8 | % | Equity Residential | 2.0 | % | ||
High Social Impact Investments | 1.1 | % | Total | 21.0 | % | ||
Total | 100.0 | % |
See Endnotes and Additional Disclosures in this report.
Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value (NAV) or offering price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance less than or equal to one year is cumulative. Performance is for the stated time period only; due to market volatility, the Fund's current performance may be lower or higher than quoted. Returns are before taxes unless otherwise noted. For performance as of the most recent month-end, please refer to calvert.com.
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Endnotes and Additional Disclosures | ||
1 Russell Midcap® Index is an unmanaged index of U.S. mid-cap stocks. Russell Midcap® Growth Index is an unmanaged index of U.S. midcap growth stocks. Unless otherwise stated, index returns do not reflect the effect of any applicable sales charges, commissions, expenses, taxes or leverage, as applicable. It is not possible to invest directly in an index.2 Total Returns at NAV do not include applicable sales charges. If sales charges were deducted, the returns would be lower. Total Returns shown with maximum sales charge reflect the stated maximum sales charge. Unless otherwise stated, performance does not reflect the deduction of taxes on Fund distributions or redemptions of Fund shares.Performance prior to the inception date of a class may be linked to the performance of an older class of the Fund. This linked performance is adjusted for any applicable sales charge, but is not adjusted for class expense differences. If adjusted for such differences, the performance would be different. The performance of Class Y is linked to Class A. Performance since inception for an index, if presented, is the performance since the Fund’s or oldest share class’ inception, as applicable. Performance presented in the Financial Highlights included in the financial statements is not linked. 3 Source: Fund prospectus. Net expense ratios reflect a contractual expense reimbursement that continues through 1/31/18. Without the reimbursement, performance would have been lower. The expense ratios for the current reporting period can be found in the Financial Highlights section of this report.4 Does not include Short Term Investment of Cash Collateral for Securities Loaned.Fund profile subject to change due to active management. |
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UNDERSTANDING YOUR FUND'S EXPENSES
As an investor, you incur two types of costs. There are transaction costs, which generally include sales charges (loads) on purchases and may include redemption fees. There are also ongoing costs, which generally include management fees, distribution and/or service fees, and other fund expenses. The following information is intended to help you understand your ongoing costs (in dollars) of investing in this mutual fund and to help you compare these costs with the ongoing costs of investing in other mutual funds.
To illustrate these ongoing costs, we have provided examples and calculated the expenses paid by the Fund's investors during the period. The actual and hypothetical information presented in the examples is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (October 1, 2016 to March 31, 2017).
Actual Expenses
The first line for each class of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 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.
Hypothetical Example for Comparison Purposes
The second line for each class of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and 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 the Fund and other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the 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 sales charges (loads) or redemption fees, if applicable. 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.
ANNUALIZED EXPENSE RATIO | BEGINNING ACCOUNT VALUE 10/1/16 | ENDING ACCOUNT VALUE 3/31/17 | EXPENSES PAID DURING PERIOD* 10/1/16 - 3/31/17 | |
Class A | ||||
Actual | 1.22% | $1,000.00 | $1,084.40 | $6.34 |
Hypothetical (5% return per year before expenses) | 1.22% | $1,000.00 | $1,018.85 | $6.14 |
Class C | ||||
Actual | 1.97% | $1,000.00 | $1,080.80 | $10.22 |
Hypothetical (5% return per year before expenses) | 1.97% | $1,000.00 | $1,015.11 | $9.90 |
Class I | ||||
Actual | 0.86% | $1,000.00 | $1,086.30 | $4.47 |
Hypothetical (5% return per year before expenses) | 0.86% | $1,000.00 | $1,020.64 | $4.33 |
Class Y | ||||
Actual | 0.97% | $1,000.00 | $1,086.00 | $5.04 |
Hypothetical (5% return per year before expenses) | 0.97% | $1,000.00 | $1,020.10 | $4.89 |
* Expenses paid during the period are equal to the annualized expense ratio for each class as indicated above, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). |
4 calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT CAPITAL ACCUMULATION FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2017 (Unaudited)
SHARES | VALUE ($) | |
COMMON STOCKS - 99.1% | ||
Aerospace & Defense - 1.1% | ||
Hexcel Corp. | 55,053 | 3,003,141 |
Air Freight & Logistics - 1.4% | ||
C.H. Robinson Worldwide, Inc. | 48,594 | 3,755,830 |
Auto Components - 1.1% | ||
Delphi Automotive plc | 39,409 | 3,172,030 |
Automobiles - 0.3% | ||
Tesla, Inc. * | 2,679 | 745,566 |
Banks - 4.1% | ||
Bank of the Ozarks, Inc. | 68,410 | 3,558,004 |
First Republic Bank | 29,625 | 2,779,121 |
Great Western Bancorp, Inc. | 47,928 | 2,032,627 |
KeyCorp | 154,454 | 2,746,192 |
11,115,944 | ||
Biotechnology - 1.6% | ||
Alexion Pharmaceuticals, Inc. * | 20,597 | 2,497,180 |
Incyte Corp. * | 13,676 | 1,828,071 |
4,325,251 | ||
Building Products - 1.6% | ||
Johnson Controls International plc | 102,528 | 4,318,479 |
Capital Markets - 4.9% | ||
CBOE Holdings, Inc. | 53,124 | 4,306,763 |
E*Trade Financial Corp. * | 78,088 | 2,724,490 |
Lazard Ltd., Class A | 64,576 | 2,969,850 |
S&P Global, Inc. | 25,461 | 3,328,771 |
13,329,874 | ||
Chemicals - 1.7% | ||
PPG Industries, Inc. | 44,969 | 4,725,343 |
Containers & Packaging - 2.6% | ||
Crown Holdings, Inc. * | 53,925 | 2,855,329 |
WestRock Co. | 82,327 | 4,283,474 |
7,138,803 | ||
calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED) 5
SHARES | VALUE ($) | |
COMMON STOCKS - CONT’D | ||
Distributors - 0.9% | ||
LKQ Corp. * | 80,351 | 2,351,874 |
Diversified Consumer Services - 3.1% | ||
Bright Horizons Family Solutions, Inc. * | 60,828 | 4,409,421 |
ServiceMaster Global Holdings, Inc. * | 96,149 | 4,014,221 |
8,423,642 | ||
Electric Utilities - 1.3% | ||
Portland General Electric Co. | 83,072 | 3,690,058 |
Electrical Equipment - 3.6% | ||
AMETEK, Inc. | 87,432 | 4,728,323 |
Hubbell, Inc. | 42,270 | 5,074,513 |
9,802,836 | ||
Electronic Equipment & Instruments - 4.1% | ||
Amphenol Corp., Class A | 53,032 | 3,774,288 |
Avnet, Inc. | 76,028 | 3,479,041 |
Dolby Laboratories, Inc., Class A | 77,796 | 4,077,288 |
11,330,617 | ||
Energy Equipment & Services - 3.8% | ||
Oceaneering International, Inc. | 198,381 | 5,372,157 |
TechnipFMC plc * | 156,602 | 5,089,565 |
10,461,722 | ||
Equity Real Estate Investment Trusts (REITs) - 10.0% | ||
AvalonBay Communities, Inc. | 32,132 | 5,899,435 |
Equity Residential | 88,000 | 5,475,360 |
Extra Space Storage, Inc. | 71,882 | 5,347,302 |
Federal Realty Investment Trust | 39,461 | 5,268,044 |
National Retail Properties, Inc. | 124,392 | 5,425,979 |
27,416,120 | ||
Food & Staples Retailing - 0.7% | ||
Kroger Co. (The) | 64,250 | 1,894,733 |
Food Products - 3.4% | ||
B&G Foods, Inc. (a) | 32,576 | 1,311,184 |
Blue Buffalo Pet Products, Inc. * | 86,517 | 1,989,891 |
Kellogg Co. | 39,209 | 2,846,966 |
Pinnacle Foods, Inc. | 53,492 | 3,095,582 |
9,243,623 | ||
6 calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED)
SHARES | VALUE ($) | |
COMMON STOCKS - CONT’D | ||
Gas Utilities - 3.2% | ||
Southwest Gas Holdings, Inc. | 48,986 | 4,061,429 |
UGI Corp. | 95,594 | 4,722,344 |
8,783,773 | ||
Health Care Equipment & Supplies - 3.2% | ||
Teleflex, Inc. | 30,930 | 5,992,069 |
West Pharmaceutical Services, Inc. | 32,925 | 2,687,009 |
8,679,078 | ||
Health Care Providers & Services - 1.6% | ||
Humana, Inc. | 7,141 | 1,472,046 |
McKesson Corp. | 19,567 | 2,901,003 |
4,373,049 | ||
Household Durables - 2.6% | ||
Newell Brands, Inc. | 80,565 | 3,800,251 |
Whirlpool Corp. | 19,266 | 3,300,844 |
7,101,095 | ||
Insurance - 4.8% | ||
Alleghany Corp. * | 9,146 | 5,621,680 |
American Financial Group, Inc. | 32,083 | 3,061,360 |
First American Financial Corp. | 114,971 | 4,516,061 |
13,199,101 | ||
Internet Software & Services - 2.9% | ||
Akamai Technologies, Inc. * | 40,314 | 2,406,746 |
eBay, Inc. * | 165,574 | 5,558,319 |
7,965,065 | ||
IT Services - 3.7% | ||
Amdocs Ltd. | 94,883 | 5,786,914 |
Convergys Corp. | 58,410 | 1,235,372 |
Fiserv, Inc. * | 26,395 | 3,043,607 |
10,065,893 | ||
Life Sciences - Tools & Services - 1.2% | ||
VWR Corp. * | 113,440 | 3,199,008 |
Machinery - 3.1% | ||
Fortive Corp. | 79,717 | 4,800,558 |
Ingersoll-Rand plc | 45,889 | 3,731,693 |
8,532,251 | ||
calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED) 7
SHARES | VALUE ($) | |
COMMON STOCKS - CONT’D | ||
Media - 2.1% | ||
Interpublic Group of Cos., Inc. (The) | 236,768 | 5,817,390 |
Metals & Mining - 1.0% | ||
Reliance Steel & Aluminum Co. | 34,845 | 2,788,297 |
Multi-Utilities - 2.1% | ||
CMS Energy Corp. | 68,271 | 3,054,445 |
Sempra Energy | 23,947 | 2,646,143 |
5,700,588 | ||
Oil, Gas & Consumable Fuels - 1.0% | ||
Enbridge, Inc. | 64,094 | 2,681,693 |
Personal Products - 1.0% | ||
Estee Lauder Cos., Inc. (The), Class A | 31,580 | 2,677,668 |
Pharmaceuticals - 1.0% | ||
Zoetis, Inc. | 53,155 | 2,836,882 |
Professional Services - 2.0% | ||
Verisk Analytics, Inc. * | 68,475 | 5,556,062 |
Road & Rail - 1.3% | ||
Norfolk Southern Corp. | 32,037 | 3,587,183 |
Semiconductors & Semiconductor Equipment - 3.7% | ||
Applied Materials, Inc. | 70,392 | 2,738,249 |
Cirrus Logic, Inc. * | 22,601 | 1,371,655 |
NXP Semiconductors NV * | 59,196 | 6,126,786 |
10,236,690 | ||
Software - 1.5% | ||
Intuit, Inc. | 35,592 | 4,128,316 |
Specialty Retail - 4.8% | ||
Advance Auto Parts, Inc. | 32,596 | 4,832,683 |
Burlington Stores, Inc. * | 27,587 | 2,683,939 |
Ross Stores, Inc. | 84,991 | 5,598,357 |
13,114,979 | ||
Total Common Stocks (Cost $263,463,186) | 271,269,547 | |
8 calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED)
PRINCIPAL AMOUNT ($) | VALUE ($) | |
HIGH SOCIAL IMPACT INVESTMENTS - 1.1% | ||
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 (b)(c) | 2,619,488 | 2,451,291 |
ImpactAssets Inc., Global Sustainable Agriculture Notes, 0.00%, 11/3/20 (b)(d)(e) | 309,000 | 275,010 |
ImpactAssets Inc., Microfinance Plus Notes, 0.00%, 11/3/20 (b)(d)(e) | 398,000 | 374,120 |
Total High Social Impact Investments (Cost $3,326,488) | 3,100,421 | |
SHARES | VALUE ($) | |
SHORT TERM INVESTMENT OF CASH COLLATERAL FOR SECURITIES LOANED - 0.5% | ||
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.62% | 1,351,904 | 1,351,904 |
Total Short Term Investment of Cash Collateral For Securities Loaned (Cost $1,351,904) | 1,351,904 | |
TOTAL INVESTMENTS (Cost $268,141,578) - 100.7% | 275,721,872 | |
Other assets and liabilities, net - (0.7%) | (1,889,464) | |
NET ASSETS - 100.0% | 273,832,408 |
NOTES TO SCHEDULE OF INVESTMENTS | ||
* Non-income producing security. | ||
(a) Security, or portion of security, is on loan. Total value of securities on loan is $1,311,184 as of March 31, 2017. | ||
(b) Restricted Security. Total market value of restricted securities amounts to $3,100,421, which represents 1.1% of the net assets of the Fund as of March 31, 2017. | ||
(c) Affiliated company (see Note F). | ||
(d) For fair value measurement disclosure purposes, security is categorized as Level 3 (see Note A). | ||
(e) Notes carry an interest rate that varies by period and is contingent on the performance of the underlying portfolio of loans to borrowers. The coupon rate shown represents the rate in effect at March 31, 2017. |
RESTRICTED SECURITIES | ACQUISITION DATES | COST ($) |
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 | 12/15/16 | 2,619,488 |
ImpactAssets Inc., Global Sustainable Agriculture Notes, 0.00%, 11/3/20 | 11/13/15 | 309,000 |
ImpactAssets Inc., Microfinance Plus Notes, 0.00%, 11/3/20 | 11/13/15 | 398,000 |
See notes to financial statements. |
calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED) 9
CALVERT CAPITAL ACCUMULATION FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 2017 (Unaudited)
ASSETS | |||
Investments in unaffiliated securities, at value (Cost $265,522,090) - see accompanying schedule | $273,270,581 | ||
Investments in affiliated securities, at value (Cost $2,619,488) - see accompanying schedule | 2,451,291 | ||
Receivable for securities sold | 273,050 | ||
Receivable for Fund shares sold | 205,165 | ||
Dividends and interest receivable | 318,451 | ||
Interest receivable - affiliated | 11,679 | ||
Securities lending income receivable | 374 | ||
Directors' deferred compensation plan | 299,171 | ||
Receivable from affiliate | 24,745 | ||
Total assets | 276,854,507 | ||
LIABILITIES | |||
Payable to custodian bank | 86,135 | ||
Payable to custodian bank - foreign currencies, at value (Cost $6,683) | 6,589 | ||
Collateral for securities loaned | 1,351,904 | ||
Payable for Fund shares redeemed | 870,387 | ||
Payable to affiliates: | |||
Investment advisory fee | 161,097 | ||
Administrative fees | 28,447 | ||
Distribution Plan expenses | 56,876 | ||
Sub-transfer agent fee | 7,834 | ||
Directors' fees and expenses | 4,838 | ||
Directors' deferred compensation plan | 299,171 | ||
Accrued expenses and other liabilities | 148,821 | ||
Total liabilities | 3,022,099 | ||
NET ASSETS | $273,832,408 | ||
NET ASSETS CONSIST OF: | |||
Paid-in capital applicable to common stock | |||
(250,000,000 shares of $0.01 par value authorized) | $242,630,605 | ||
Accumulated undistributed net investment income | 974,142 | ||
Accumulated net realized gain (loss) | 22,647,273 | ||
Net unrealized appreciation (depreciation) | 7,580,388 | ||
NET ASSETS | $273,832,408 |
10 calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED)
NET ASSET VALUE PER SHARE | |||
Class A (based on net assets of $166,892,306 and 5,211,772 shares outstanding) | $32.02 | ||
Class C (based on net assets of $21,175,176 and 896,256 shares outstanding) | $23.63 | ||
Class I (based on net assets of $72,250,486 and 1,950,960 shares outstanding) | $37.03 | ||
Class Y (based on net assets of $13,514,440 and 415,717 shares outstanding) | $32.51 | ||
OFFERING PRICE PER SHARE* | |||
Class A (100/95.25 of net asset value per share) | $33.62 | ||
* On sales of $50,000 or more, the offering price of Class A shares is reduced. | |||
See notes to financial statements. |
calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED) 11
CALVERT CAPITAL ACCUMULATION FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED MARCH 31, 2017 (Unaudited)
NET INVESTMENT INCOME | |||
Investment Income: | |||
Dividend income (net of foreign taxes withheld of $6,613) | $4,117,368 | ||
Interest income | 14,205 | ||
Interest Income - affiliated | 13,567 | ||
Securities lending income | 13,029 | ||
Other income | 235 | ||
Total investment income | 4,158,404 | ||
Expenses: | |||
Investment advisory fee | 1,179,909 | ||
Administrative fees | 217,829 | ||
Transfer agency fees and expenses: | |||
Class A | 189,456 | ||
Class C | 26,571 | ||
Class I | 3,955 | ||
Class Y | 7,845 | ||
Distribution Plan expenses: | |||
Class A | 234,292 | ||
Class C | 109,864 | ||
Directors' fees and expenses | 22,072 | ||
Accounting fees | 53,872 | ||
Custodian fees | 27,223 | ||
Professional fees | 21,775 | ||
Registration fees: | |||
Class A | 11,784 | ||
Class C | 7,685 | ||
Class I | 8,954 | ||
Class Y | 6,551 | ||
Reports to shareholders | 27,969 | ||
Miscellaneous | 19,254 | ||
Total expenses | 2,176,860 | ||
Reimbursement from Adviser: | |||
Class A | (108,485) | ||
Class C | (23,387) | ||
Class Y | (8,897) | ||
Administrative fees waived | (14,245) | ||
Net expenses | 2,021,846 | ||
NET INVESTMENT INCOME (LOSS) | 2,136,558 | ||
12 calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED)
REALIZED AND UNREALIZED GAIN (LOSS) | |||
Net realized gain (loss) on: | |||
Investments | 29,880,004 | ||
Foreign currency transactions | (11,392) | ||
29,868,612 | |||
Net change in unrealized appreciation (depreciation) on: | |||
Investments | (692,963) | ||
Investments in affiliated securities | (108,078) | ||
Foreign currency | 728 | ||
(800,313) | |||
NET REALIZED AND UNREALIZED GAIN (LOSS) | 29,068,299 | ||
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $31,204,857 | ||
See notes to financial statements. |
calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED) 13
CALVERT CAPITAL ACCUMULATION FUND
STATEMENTS OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS | SIX MONTHS ENDED MARCH 31, 2017 (Unaudited) | YEAR ENDED SEPTEMBER 30, 2016 | |||||
Operations: | |||||||
Net investment income (loss) | $2,136,558 | $1,183,968 | |||||
Net realized gain (loss) | 29,868,612 | 10,706,337 | |||||
Net change in unrealized appreciation (depreciation) | (800,313) | (22,274,864) | |||||
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | 31,204,857 | (10,384,559) | |||||
Distributions to shareholders from: | |||||||
Net investment income: | |||||||
Class A shares | (920,858) | — | |||||
Class I shares | (1,312,875) | — | |||||
Class Y shares | (56,984) | — | |||||
Net realized gain: | |||||||
Class A shares | (45,181) | (20,254,450) | |||||
Class C shares | (7,085) | (3,590,824) | |||||
Class I shares | (32,799) | (19,759,432) | |||||
Class Y shares | (2,238) | (1,435,594) | |||||
Total distributions | (2,378,020) | (45,040,300) | |||||
Capital share transactions: | |||||||
Shares sold: | |||||||
Class A shares | 9,284,732 | 28,327,643 | |||||
Class C shares | 759,911 | 3,480,475 | |||||
Class I shares | 23,603,061 | 58,476,366 | |||||
Class Y shares | 8,178,786 | 12,935,704 | |||||
Reinvestment of distributions: | |||||||
Class A shares | 924,906 | 19,092,505 | |||||
Class C shares | 6,012 | 3,032,821 | |||||
Class I shares | 1,330,971 | 13,922,616 | |||||
Class Y shares | 46,879 | 1,423,382 | |||||
Shares redeemed: | |||||||
Class A shares | (49,998,931) | (53,059,309) | |||||
Class C shares | (4,165,686) | (8,979,532) | |||||
Class I shares | (131,515,965) | (117,783,199) | |||||
Class Y shares | (9,032,738) | (12,384,370) | |||||
Total capital share transactions | (150,578,062) | (51,514,898) | |||||
TOTAL INCREASE (DECREASE) IN NET ASSETS | (121,751,225) | (106,939,757) | |||||
See notes to financial statements. |
14 calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT CAPITAL ACCUMULATION FUND
STATEMENTS OF CHANGES IN NET ASSETS - CONT’D
NET ASSETS | SIX MONTHS ENDED MARCH 31, 2017 (Unaudited) | YEAR ENDED SEPTEMBER 30, 2016 | |||||
Beginning of period | $395,583,633 | $502,523,390 | |||||
End of period (including accumulated undistributed net investment income of $974,142 and $1,128,301, respectively) | $273,832,408 | $395,583,633 | |||||
CAPITAL SHARE ACTIVITY | |||||||
Shares sold: | |||||||
Class A shares | 299,343 | 938,319 | |||||
Class C shares | 33,125 | 150,707 | |||||
Class I shares | 656,135 | 1,675,673 | |||||
Class Y shares | 256,003 | 427,806 | |||||
Reinvestment of distributions: | |||||||
Class A shares | 29,416 | 633,251 | |||||
Class C shares | 259 | 135,636 | |||||
Class I shares | 36,631 | 399,960 | |||||
Class Y shares | 1,469 | 46,622 | |||||
Shares redeemed: | |||||||
Class A shares | (1,600,099) | (1,773,058) | |||||
Class C shares | (183,379) | (404,711) | |||||
Class I shares | (3,592,122) | (3,433,920) | |||||
Class Y shares | (291,187) | (413,736) | |||||
Total capital share activity | (4,354,406) | (1,617,451) | |||||
See notes to financial statements. |
calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED) 15
CALVERT CAPITAL ACCUMULATION FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS A SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012 (a) | ||||||||||||
Net asset value, beginning | $29.68 | $33.41 | $36.99 | $36.83 | $31.45 | $26.00 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income (loss) | 0.17 | 0.02(b) | (0.16) | (0.14) | (0.18) | (0.26) | |||||||||||
Net realized and unrealized gain (loss) | 2.33 | (0.67) | 1.91 | 2.94 | 7.49 | 7.64 | |||||||||||
Total from investment operations | 2.50 | (0.65) | 1.75 | 2.80 | 7.31 | 7.38 | |||||||||||
Distributions from: | |||||||||||||||||
Net investment income | (0.15) | — | — | — | — | — | |||||||||||
Net realized gain | (0.01) | (3.08) | (5.33) | (2.64) | (1.93) | (1.93) | |||||||||||
Total distributions | (0.16) | (3.08) | (5.33) | (2.64) | (1.93) | (1.93) | |||||||||||
Total increase (decrease) in net asset value | 2.34 | (3.73) | (3.58) | 0.16 | 5.38 | 5.45 | |||||||||||
Net asset value, ending | $32.02 | $29.68 | $33.41 | $36.99 | $36.83 | $31.45 | |||||||||||
Total return (c) | 8.44 | % | (2.08 | %) | 4.90 | % | 7.90 | % | 24.74 | % | 29.16 | % | |||||
Ratios to average net assets: (d) | |||||||||||||||||
Net investment income (loss) | 1.07%(e) | 0.07%(b) | (0.43 | %) | (0.36 | %) | (0.53 | %) | (0.85 | %) | |||||||
Total expenses | 1.33%(e) | 1.37 | % | 1.41 | % | 1.43 | % | 1.48 | % | 1.53 | % | ||||||
Net expenses | 1.22%(e) | 1.31 | % | 1.41 | % | 1.43 | % | 1.48 | % | 1.53 | % | ||||||
Portfolio turnover | 100 | % | 199 | % | 74 | % | 81 | % | 73 | % | 63 | % | |||||
Net assets, ending (in thousands) | $166,892 | $192,402 | $223,328 | $215,683 | $207,257 | $157,016 | |||||||||||
(a) Net investment income (loss) per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.001 per share and 0.00% of average net assets. | |||||||||||||||||
(c) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(d) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(e) Annualized. | |||||||||||||||||
See notes to financial statements. |
16 calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT CAPITAL ACCUMULATION FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS C SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012 (a) | ||||||||||||
Net asset value, beginning | $21.87 | $25.62 | $29.76 | $30.35 | $26.44 | $22.29 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income (loss) | 0.04 | (0.16)(b) | (0.34) | (0.34) | (0.36) | (0.42) | |||||||||||
Net realized and unrealized gain (loss) | 1.73 | (0.51) | 1.53 | 2.39 | 6.20 | 6.50 | |||||||||||
Total from investment operations | 1.77 | (0.67) | 1.19 | 2.05 | 5.84 | 6.08 | |||||||||||
Distributions from: | |||||||||||||||||
Net realized gain | (0.01) | (3.08) | (5.33) | (2.64) | (1.93) | (1.93) | |||||||||||
Total distributions | (0.01) | (3.08) | (5.33) | (2.64) | (1.93) | (1.93) | |||||||||||
Total increase (decrease) in net asset value | 1.76 | (3.75) | (4.14) | (0.59) | 3.91 | 4.15 | |||||||||||
Net asset value, ending | $23.63 | $21.87 | $25.62 | $29.76 | $30.35 | $26.44 | |||||||||||
Total return (c) | 8.08 | % | (2.87 | %) | 4.09 | % | 7.06 | % | 23.81 | % | 28.11 | % | |||||
Ratios to average net assets: (d) | |||||||||||||||||
Net investment income (loss) | 0.32%(e) | (0.72%)(b) | (1.23 | %) | (1.12 | %) | (1.30 | %) | (1.64 | %) | |||||||
Total expenses | 2.18%(e) | 2.16 | % | 2.21 | % | 2.19 | % | 2.25 | % | 2.33 | % | ||||||
Net expenses | 1.97%(e) | 2.09 | % | 2.21 | % | 2.19 | % | 2.25 | % | 2.33 | % | ||||||
Portfolio turnover | 100 | % | 199 | % | 74 | % | 81 | % | 73 | % | 63 | % | |||||
Net assets, ending (in thousands) | $21,175 | $22,885 | $29,837 | $27,588 | $25,311 | $18,630 | |||||||||||
(a) Net investment income (loss) per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.001 per share and 0.00% of average net assets. | |||||||||||||||||
(c) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(d) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(e) Annualized. | |||||||||||||||||
See notes to financial statements. |
calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED) 17
CALVERT CAPITAL ACCUMULATION FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS I SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012 (a) | ||||||||||||
Net asset value, beginning | $34.38 | $38.05 | $41.19 | $40.50 | $34.18 | $27.94 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income (loss) | 0.26 | 0.19(b) | 0.06 | 0.10 | 0.03 | (0.05) | |||||||||||
Net realized and unrealized gain (loss) | 2.70 | (0.78) | 2.13 | 3.23 | 8.22 | 8.22 | |||||||||||
Total from investment operations | 2.96 | (0.59) | 2.19 | 3.33 | 8.25 | 8.17 | |||||||||||
Distributions from: | |||||||||||||||||
Net investment income | (0.30) | — | — | — | — | — | |||||||||||
Net realized gain | (0.01) | (3.08) | (5.33) | (2.64) | (1.93) | (1.93) | |||||||||||
Total distributions | (0.31) | (3.08) | (5.33) | (2.64) | (1.93) | (1.93) | |||||||||||
Total increase (decrease) in net asset value | 2.65 | (3.67) | (3.14) | 0.69 | 6.32 | 6.24 | |||||||||||
Net asset value, ending | $37.03 | $34.38 | $38.05 | $41.19 | $40.50 | $34.18 | |||||||||||
Total return (c) | 8.63 | % | (1.64 | %) | 5.53 | % | 8.53 | % | 25.55 | % | 30.00 | % | |||||
Ratios to average net assets: (d) | |||||||||||||||||
Net investment income (loss) | 1.43%(e) | 0.55%(b) | 0.14 | % | 0.24 | % | 0.08 | % | (0.16 | %) | |||||||
Total expenses | 0.88%(e) | 0.86 | % | 0.83 | % | 0.82 | % | 0.85 | % | 0.88 | % | ||||||
Net expenses | 0.86%(e) | 0.84 | % | 0.83 | % | 0.82 | % | 0.85 | % | 0.86 | % | ||||||
Portfolio turnover | 100 | % | 199 | % | 74 | % | 81 | % | 73 | % | 63 | % | |||||
Net assets, ending (in thousands) | $72,250 | $166,759 | $236,228 | $156,677 | $130,705 | $83,181 | |||||||||||
(a) Net investment income (loss) per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.001 per share and 0.00% of average net assets. | |||||||||||||||||
(c) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(d) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(e) Annualized. | |||||||||||||||||
See notes to financial statements. |
18 calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT CAPITAL ACCUMULATION FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS Y SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012 (a) | ||||||||||||
Net asset value, beginning | $30.12 | $33.78 | $37.26 | $37.04 | $31.56 | $26.03 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income (loss) | 0.22 | 0.08(b) | (0.07) | (0.07) | (0.12) | (0.18) | |||||||||||
Net realized and unrealized gain (loss) | 2.37 | (0.66) | 1.92 | 2.93 | 7.53 | 7.64 | |||||||||||
Total from investment operations | 2.59 | (0.58) | 1.85 | 2.86 | 7.41 | 7.46 | |||||||||||
Distributions from: | |||||||||||||||||
Net investment income | (0.19) | — | — | — | — | — | |||||||||||
Net realized gain | (0.01) | (3.08) | (5.33) | (2.64) | (1.93) | (1.93) | |||||||||||
Total distributions | (0.20) | (3.08) | (5.33) | (2.64) | (1.93) | (1.93) | |||||||||||
Total increase (decrease) in net asset value | 2.39 | (3.66) | (3.48) | 0.22 | 5.48 | 5.53 | |||||||||||
Net asset value, ending | $32.51 | $30.12 | $33.78 | $37.26 | $37.04 | $31.56 | |||||||||||
Total return (c) | 8.60 | % | (1.83 | %) | 5.16 | % | 8.02 | % | 24.98 | % | 29.45 | % | |||||
Ratios to average net assets: (d) | |||||||||||||||||
Net investment income (loss) | 1.40%(e) | 0.28%(b) | (0.20 | %) | (0.17 | %) | (0.36 | %) | (0.59 | %) | |||||||
Total expenses | 1.12%(e) | 1.08 | % | 1.18 | % | 1.26 | % | 1.29 | % | 1.29 | % | ||||||
Net expenses | 0.97%(e) | 1.02 | % | 1.18 | % | 1.26 | % | 1.29 | % | 1.29 | % | ||||||
Portfolio turnover | 100 | % | 199 | % | 74 | % | 81 | % | 73 | % | 63 | % | |||||
Net assets, ending (in thousands) | $13,514 | $13,538 | $13,130 | $10,871 | $14,719 | $8,071 | |||||||||||
(a) Net investment income (loss) per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.001 per share and 0.00% of average net assets. | |||||||||||||||||
(c) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(d) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(e) Annualized. | |||||||||||||||||
See notes to financial statements. |
calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED) 19
NOTES TO FINANCIAL STATEMENTS
NOTE A — SIGNIFICANT ACCOUNTING POLICIES
General: Calvert World Values Fund, Inc. (the “Corporation”) was organized as a Maryland corporation on February 14, 1992, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Corporation operates four (4) separate series, or mutual funds, each with its own investment objective(s) and strategies, that are accounted for separately. This report contains the financial statements and financial highlights of Calvert Capital Accumulation Fund (the “Fund”). The Corporation is authorized to issue two billion shares of common stock, $0.01 par value per share, of which 250 million shares have been allocated to the Fund.
The investment objective of the Fund, which is diversified, is to seek to provide long-term capital appreciation by investing primarily in mid-cap stocks.
The Fund offers Class A, Class C, Class I and Class Y shares. Class A shares are generally sold with a maximum front-end sales charge of 4.75%. A contingent deferred sales charge of 0.80% may apply to certain redemptions of Class A shares for accounts for which no sales charge was paid, if redeemed within one year of purchase. Class C shares are sold without a front-end sales charge, and with certain exceptions, are charged a contingent deferred sales charge of 1% on shares redeemed within one year of purchase. Class C shares have higher levels of expenses than Class A shares. Class I shares require a minimum account balance of $1 million. The $1 million minimum initial investment is waived for retirement plans that trade through omnibus accounts and may be waived in certain other instances where it is believed to be in the best interest of the Fund and its shareholders. Class I shares have no front-end or contingent deferred sales charge and have lower levels of expenses than Class A shares. Class Y shares are generally only available to wrap or similar fee-based programs offered by financial intermediaries that have entered into an agreement with the Fund’s principal underwriter to offer Class Y shares to their clients, and retirement plans, foundations, endowments and other consultant-driven business. Class Y shares have no front-end or contingent deferred sales charge and have lower levels of expenses than Class A shares. Among other things, each class has different: (a) dividend rates due to differences in Distribution Plan expenses and other class-specific expenses; (b) exchange privileges; and (c) class-specific voting rights.
The Fund applies the accounting and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946, Financial Services – Investment Companies (ASC 946). Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements.
Security Valuation: Net asset value per share is determined every business day as of the close of the regular session of the New York Stock Exchange (generally 4:00 p.m. Eastern time). The Fund uses independent pricing services approved by the Board of Directors (the “Board”) to value its investments wherever possible. Investments for which market quotations are not available or deemed not reliable are fair valued in good faith under the direction of the Board.
The Board has adopted Valuation Procedures (the “Procedures”) to determine the fair value of securities and financial instruments for which market prices are not readily available or which may not be reliably priced. The Board has delegated the day-to-day responsibility for determining the fair value of securities and financial instruments of the Fund to the Fund's investment adviser (the “Adviser”) and has provided these Procedures to govern the Adviser in its valuation duties.
The Adviser has chartered an internal Valuation Committee to oversee the implementation of these Procedures and to assist it in carrying out the valuation responsibilities that the Board has delegated.
The Valuation Committee meets on a regular basis to review investments which may not have readily available market prices. The Valuation Committee’s fair valuation determinations are subject to review, approval and ratification by the Board at its next regularly scheduled meeting covering the calendar quarter in which the fair valuation was determined.
The Valuation Committee utilizes various methods to measure the fair value of the Fund’s investments. U.S. generally accepted accounting principles (U.S. GAAP) establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are summarized in the three broad levels listed below:
Level 1 - quoted prices in active markets for identical securities
Level 2 - other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
Level 3 - significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
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Changes in valuation techniques may result in transfers in or out of an investment’s assigned level within the hierarchy during the period. Transfers in and/or out of levels are determined based on the fair value of such securities at the end of the period. Valuation techniques used to value the Fund’s investments by major category are as follows:
Common stocks for which market quotations are readily available are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or the last available price and are categorized as Level 2 in the hierarchy. Foreign securities are valued based on quotations from the principal market in which such securities are normally traded. The Fund has retained a third party fair value pricing service to quantitatively analyze the price movement of its holdings on foreign exchanges and to automatically fair value these securities each business day. The third party fair value pricing service takes into account many factors, including, but not limited to, movements in U.S. securities markets and changes in futures contracts and foreign exchange rates that have occurred after the close of the principal foreign market, to determine a fair value as of the close of the New York Stock Exchange. Such securities are categorized as Level 2 in the hierarchy.
For restricted securities and private placements (equity and debt) where observable inputs may be limited, assumptions about market activity and risk are used and such securities are categorized as either Level 2 or Level 3 in the hierarchy depending on the relative significance of valuation inputs.
Short-term securities of sufficient credit quality with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates fair value, and are categorized as Level 2 in the hierarchy.
Mutual funds are valued at their closing net asset value each business day and are categorized as Level 1 in the hierarchy.
If a market value cannot be determined for a security using the methodologies described above, or if, in the good faith opinion of the Adviser, the market value does not constitute a readily available market quotation, or if a significant event has occurred that would materially affect the value of the security, the security will be fair valued as determined in good faith by the Valuation Committee.
The Valuation Committee considers a number of factors, including significant unobservable valuation inputs when arriving at fair value. It considers all significant facts that are reasonably available and relevant to the determination of fair value.
The Valuation Committee primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. When more appropriate, the Fund may employ an income-based or cost approach. An income-based valuation approach discounts anticipated future cash flows of the investment to calculate a present amount (discounted). The measurement is based on the value indicated by current market expectations about those future amounts. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. A cost-based approach is based on the amount that currently would be required to replace the service capacity of an asset (current replacement cost). From the seller’s perspective, the price that would be received for the asset is determined based on the cost to a buyer to acquire or construct a substitute asset of comparable utility, adjusted for obsolescence.
The values assigned to fair value investments are based on available information and do not necessarily represent amounts that might ultimately be realized. Further, due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed, and the differences could be material. The Valuation Committee employs various methods for calibrating these valuation approaches including a regular review of key inputs and assumptions, transactional back-testing or disposition analysis and reviews of any related market activity.
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VALUATION INPUTS | |||||||||||
INVESTMENTS IN SECURITIES | LEVEL 1 | LEVEL 2 | LEVEL 3 | TOTAL | |||||||
Common Stocks* | $271,269,547 | $— | $— | $271,269,547 | |||||||
High Social Impact Investments | — | 2,451,291 | 649,130 | 3,100,421 | |||||||
Short Term Investment of Cash Collateral For Securities Loaned | 1,351,904 | — | — | 1,351,904 | |||||||
TOTAL | $272,621,451 | $2,451,291 | $649,130^ | $275,721,872 | |||||||
* For further breakdown of equity securities by industry, please refer to the Schedule of Investments. | |||||||||||
^ Level 3 securities represent 0.2% of net assets. |
There were no transfers between Level 1 and Level 2 during the six months ended March 31, 2017.
Restricted Securities: The Fund may invest in securities that are subject to legal or contractual restrictions on resale. Generally, these securities may only be sold publicly upon registration under the Securities Act of 1933 or in transactions exempt from such registration. Information regarding restricted securities is included at the end of the Schedule of Investments.
Security Transactions and Investment Income: Security transactions are accounted for on trade date. Realized gains and losses are recorded on an identified cost basis and may include proceeds from litigation. Dividend income is recorded on the ex-dividend date or, in the case of dividends on certain foreign securities, as soon as the Fund is informed of the ex-dividend date. Withholding taxes on foreign dividends have been provided for in accordance with the Fund’s understanding of the applicable country’s tax rules and rates. Distributions received that represent a return of capital are recorded as a reduction of cost of investments. Distributions received that represent a capital gain are recorded as a realized gain. Interest income, which includes amortization of premium and accretion of discount on debt securities, is accrued as earned.
Share Class Accounting: Investment income and realized and unrealized gains and losses are allocated to separate classes of shares based upon the relative net assets of each class. Expenses common to the classes are also allocated to each class in proportion to their relative net assets. Expenses arising in connection with a specific class are charged directly to that class.
Foreign Currency Transactions: The Fund’s accounting records are maintained in U.S. dollars. For valuation of assets and liabilities on each date of net asset value determination, foreign denominations are converted into U.S. dollars using the current exchange rate. Security transactions, income, and expenses are translated at the prevailing rate of exchange on the date of the event. Recognized gains or losses on investment transactions attributable to changes in foreign currency exchange rates are recorded for financial statement purposes as net realized gains and losses on investments. That portion of unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed.
Distributions to Shareholders: Distributions to shareholders are recorded by the Fund on ex-dividend date. Dividends from net investment income and distributions from net realized capital gains, if any, are paid at least annually. Distributions are determined in accordance with income tax regulations which may differ from U.S. GAAP; accordingly, periodic reclassifications are made within the Fund's capital accounts to reflect income and gains available for distribution under income tax regulations.
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 and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.
Federal Income Taxes: No provision for federal income or excise tax is required since the Fund intends to continue to qualify as a regulated investment company under the Internal Revenue Code and to distribute substantially all of its taxable earnings.
Management has analyzed the Fund's tax positions taken for all open federal income tax years and has concluded that no provision for federal income tax is required in the Fund's financial statements. A Fund's federal tax return is subject to examination by the Internal Revenue Service for a period of three years.
Interim Financial Statements: The interim financial statements relating to March 31, 2017 and for the six months then ended have not been audited by an independent registered public accounting firm, but in the opinion of the Fund’s management, reflect all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the financial statements.
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NOTE B — RELATED PARTY TRANSACTIONS
Effective December 31, 2016, Calvert Research and Management (CRM), a subsidiary of Eaton Vance Management (EVM), became the investment adviser to the Fund following a transaction between CRM and certain of its affiliates and Calvert Investment Management, Inc. (CIM) and certain of its affiliates, pursuant to which CRM acquired substantially all of the business assets of CIM after satisfying various closing conditions, including shareholder approval of a new investment advisory agreement between the Fund and CRM (the “Transaction”).
For its services pursuant to the new investment advisory agreement, CRM receives a fee, payable monthly, at the annual rate of 0.65% of the Fund’s average daily net assets. Prior to December 31, 2016, CIM, a direct subsidiary of Calvert Investments, Inc. and an indirect subsidiary of Ameritas Holding Company, provided investment advisory services to the Fund. For its services, CIM received a fee at the same annual rate as the Fund’s investment advisory agreement with CRM. For the six months ended March 31, 2017, the investment advisory fee amounted to $1,179,909, of which $551,918 was paid to CRM and $627,991 was paid to CIM.
CRM has agreed to reimburse the Fund’s operating expenses to the extent that total annual operating expenses (relating to ordinary operating expenses only and excluding expenses such as brokerage commissions, acquired fund fees and expenses of unaffiliated funds, interest expense, taxes or litigation expenses) exceed 1.21%, 1.96%, 0.86% and 0.96% for Class A, Class C, Class I and Class Y, respectively, of such class’ average daily net assets. The expense reimbursement agreement with CRM may be changed or terminated after January 31, 2018. For the six months ended March 31, 2017, CRM waived or reimbursed expenses of $68,053 and CIM waived or reimbursed expenses of $72,716.
The administrative fee is earned by CRM as compensation for administrative services rendered to the Fund. The fee is computed at an annual rate of 0.12% of the Fund’s average daily net assets and is payable monthly. CRM has agreed to contractually waive 0.02% of the administrative fee through January 31, 2018 for Class I. Prior to December 31, 2016, Calvert Investment Administrative Services, Inc. (CIAS), an affiliate of CIM, provided administrative services to the Fund at an annual rate of 0.12% of the Fund's average daily net assets, payable monthly. In addition, CIAS contractually waived administrative fees of 0.02% for the period October 1, 2016 through December 30, 2016 for Class I. For the six months ended March 31, 2017, CRM was paid administrative fees of $101,892, of which $6,087 were waived and CIAS was paid administrative fees of $115,937, of which $8,158 were waived.
The Fund adopted a new distribution plan for Class A shares (Class A Plan) and Class C shares (Class C Plan) pursuant to Rule 12b-1 under the 1940 Act, which were approved by the Board of Directors and became effective as of December 31, 2016 or shortly thereafter upon approval by the shareholders of the respective class. Pursuant to the Class A Plan and Class C Plan, the Fund pays a distribution fee of 0.25% and 0.75% per annum for Class A and Class C, respectively, and a service fee of 0.25% per annum for Class C of its average daily net assets attributable to such class for distribution services and facilities provided to the Fund, as well as for personal and/or account maintenance services provided. Pursuant to the Fund’s former distribution plans for Class A shares and Class C shares, the Fund was permitted to pay certain expenses associated with the distribution and servicing of its Class A and Class C shares not to exceed 0.50% for Class A and 1.00% for Class C of the Fund’s average daily net assets with respect to such class. Effective December 31, 2016, the fees are paid to Eaton Vance Distributors, Inc. (EVD), an affiliate of CRM and the Fund’s principal underwriter. Prior to December 31, 2016, the fees were paid to Calvert Investment Distributors, Inc. (CID), an affiliate of CIM and the Fund’s former distributor and principal underwriter. Distribution and service fees paid or accrued for the six months ended March 31, 2017 amounted to $234,292 or 0.25% per annum of Class A’s average daily net assets, of which $115,593 was paid to EVD and $118,699 was paid to CID, and $109,864 or 1.00% per annum of Class C’s average daily net assets, of which $54,381 was paid to EVD and $55,483 was paid to CID.
The Fund was informed that EVD and CID received $10,154 and $6,833, respectively, as their portion of the sales charge on sales of Class A shares for the six months ended March 31, 2017. The Fund was also informed that EVD and CID received $307 and $0, respectively, of contingent deferred sales charges paid by Fund shareholders for the same period.
Effective December 31, 2016, EVM provides sub-transfer agency services to the Fund pursuant to a Sub-Transfer Agency Support Services Agreement. For its services, EVM receives an annual fee of $8 per shareholder account. Prior to December 31, 2016, Calvert Investment Services, Inc. (CIS), an affiliate of CIM, acted as the shareholder servicing agent for the Fund and received a fee at the same rate as is paid to EVM. For the six months ended March 31, 2017, sub-transfer agency fees paid to EVM were $19,110 and shareholder servicing fees paid to CIS were $19,986. Such fees are included in transfer agency fees and expenses on the Statement of Operations.
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Each Director of the Fund who is not an employee of CRM or its affiliates receives a fee of $3,000 for each Board meeting attended in person and $2,000 for each Board meeting attended by phone plus an annual fee of $52,000, and $1,500 for each Committee meeting attended in person and $1,000 for each Committee meeting attended by phone plus an annual Committee fee of $2,500. The Board chair receives an additional $10,000 annual retainer and Committee chairs receive an additional $6,000 annual retainer. Prior to December 31, 2016, each Director of the Fund who was not an employee of CIM or its affiliates received a fee of $3,000 for each Board meeting attended plus an annual fee of $52,000. Committee members received $500 for each Committee meeting attended plus an annual fee of $2,500. Committee chairs received an additional annual retainer ranging from $6,000 to $10,000. Eligible Directors may participate in a Deferred Compensation Plan (the “Plan”). Amounts deferred under the Plan are treated as though equal dollar amounts had been invested in shares of the Fund or other Calvert funds selected by the Directors. The Fund purchases shares of the funds selected equal to the dollar amounts deferred under the Plan, resulting in an asset equal to the deferred compensation liability. Obligations of the Plan are paid solely from the Fund’s assets. Directors’ fees are allocated to each of the Calvert funds served. Salaries and fees of officers and Directors of the Fund who are employees of CRM and, prior to December 31, 2016, of CIM or their affiliates are/were paid by CRM and CIM, respectively. In addition, in connection with the Transaction, an advisory council was established to aid the Board and the Calvert funds’ Adviser in advancing the cause of responsible investing through original scholarship and thought leadership. The advisory council consists of the Adviser’s Chief Executive Officer and four additional members. Each member (other than the Adviser’s Chief Executive Officer) receives annual compensation of $75,000, which will be reimbursed by CIM and Ameritas Holding Company for a period of up to three years.
NOTE C — INVESTMENT ACTIVITY AND TAX INFORMATION
During the six months ended March 31, 2017, the cost of purchases and proceeds from sales of investments, other than short-term securities, were $358,554,208 and $503,626,781, respectively.
The cost and unrealized appreciation (depreciation) of investments of the Fund at March 31, 2017, as determined on a federal income tax basis, were as follows:
Unrealized appreciation | $14,248,160 | |||
Unrealized (depreciation) | (7,014,308 | ) | ||
Net unrealized appreciation (depreciation) | $7,233,852 | |||
Federal income tax cost of investments | $268,488,020 |
NOTE D — SECURITIES LENDING
To generate additional income, the Fund may lend its securities pursuant to a securities lending agency agreement (“Lending Agreement”) with State Street Bank, the securities lending agent. Security loans are subject to termination by the Fund at any time and, therefore, are not considered to be illiquid investments. The Fund requires that the loan be continuously collateralized by either cash or securities as collateral equal at all times to at least 102% of the market value of the domestic securities loaned and 105% of the market value on the international securities loaned (if applicable). Cash collateral is generally invested in State Street Institutional U.S. Government Money Market Fund (the “U.S. Government Fund”) that is managed by an affiliate of the custodian. The U.S. Government Fund is a registered money market fund that invests in a variety of high-quality, U.S. dollar denominated instruments. Any gain or loss in the market price of the loaned securities that might occur and any interest earned or dividends declared during the term of the loan would accrue to the account of the Fund. Income earned on the investment of collateral, net of broker rebates and other expenses incurred by the securities lending agent, is split between the Fund and the securities lending agent on the basis of agreed upon contractual terms.
The risks associated with lending portfolio securities include, but are not limited to, possible delays in receiving additional collateral or in the recovery of the loaned securities, possible loss of rights to the collateral should the borrower fail financially, as well as risk of loss in the value of the collateral or the value of the investments made with the collateral. The securities lending agent shall indemnify the Fund in the case of default of any securities borrower.
The total value of securities on loan was $1,311,184 as of March 31, 2017.
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The following table displays a breakdown of transactions accounted for as secured borrowings, the obligations by class of collateral pledged, and the remaining contractual maturity of those transactions as of March 31, 2017.
Remaining Contractual Maturity of the Agreements as of March 31, 2017 | |||||
Overnight and Continuous | <30 days | Between 30 & 90 days | >90 days | Total | |
Securities Lending Transactions | |||||
Common Stocks | $1,351,904 | $— | $— | $— | $1,351,904 |
Amount of recognized liabilities for securities lending transactions | $1,351,904 |
The carrying amount of the liability for collateral for securities loaned at March 31, 2017 approximated its fair value. If measured at fair value, such liability would have been considered as Level 2 in the fair value hierarchy (see Note A) at March 31, 2017.
NOTE E — LINE OF CREDIT
A financing agreement is in place with the Calvert Funds and State Street Bank and Trust Company (SSB). Under the agreement, which expires on August 8, 2017, SSB provides an unsecured line of credit facility, in the aggregate amount of $50 million ($25 million committed and $25 million uncommitted), accessible by the Calvert Funds for temporary or emergency purposes only. Borrowings bear interest at the higher of the One-Month London Interbank Offered Rate (LIBOR) in effect that day or the overnight Federal Funds Rate plus 1.25% per annum. A commitment fee of 0.25% per annum is incurred on the unused portion of the committed facility. An administrative fee of $30,000 was paid in connection with the uncommitted facility. These fees are allocated to all participating funds. Because the line of credit is not available exclusively to the Fund, it may be unable to borrow some or all of its requested amounts at any particular time. The Fund had no loans outstanding pursuant to this line of credit at March 31, 2017.
For the six months ended March 31, 2017, borrowing information by the Fund under the agreement was as follows:
Average Daily Balance | Weighted Average Interest Rate | Maximum Amount Borrowed | Month of Maximum Amount Borrowed |
$782,278 | 2.03% | $35,757,904 | March 2017 |
NOTE F — AFFILIATED COMPANIES
The Fund invests a portion of its assets designated for high social impact investments in notes issued by the Calvert Social Investment Foundation (the “Foundation”) pursuant to an exemptive order granted by the U.S. Securities and Exchange Commission (the “SEC”). The Fund relies on exemptive relief to invest in the notes because the Fund’s investments in the notes may be considered prohibited transactions between affiliated persons under the 1940 Act. The Foundation may be considered an affiliated person of the Calvert Funds based on the overlap between the Foundation’s Board of Directors and the Funds’ Directors/Trustees and other potential affiliations. The Foundation has licensed use of the Calvert name from the Adviser, and the Adviser’s President and Chief Executive Officer serves on the Foundation Board. The Foundation is not owned or otherwise controlled by the Adviser or its affiliates. Transactions in affiliated companies by the Fund for the six months ended March 31, 2017 were as follows:
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Name of Affiliated Company | Principal Amount, beginning of period | Gross Additions | Gross Reductions | Principal Amount, end of period | Value, end of period | Interest Income | Net Realized Gain (Loss) | Capital Gain Distributions Received | Change In Unrealized Appreciation (Depreciation) | |||||||||||
Calvert Social Investment Foundation, Community Investment Notes, 0.25%, 7/1/17 | $1,419,488 | $— | ($1,419,488) | $— | $— | $722 | $— | $— | $39,959 | |||||||||||
Calvert Social Investment Foundation, Community Investment Notes, 0.50%, 3/18/17 | 1,200,000 | — | (1,200,000 | ) | — | — | 1,166 | — | — | 20,160 | ||||||||||
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 | — | 2,619,488 | — | 2,619,488 | 2,451,291 | 11,679 | — | — | (168,197 | ) | ||||||||||
TOTALS | $2,451,291 | $13,567 | $— | $— | ($108,078 | ) |
NOTE G — REGULATORY MATTERS
On October 18, 2016, CIM announced that it had determined that certain fees paid to third-party financial intermediaries were incorrectly allocated for payment by, and paid by, the Calvert Funds. Specifically, for periods prior to January 1, 2015, the Calvert Funds paid fees under certain intermediary agreements that were primarily for distribution-related services or were in excess of the sub-transfer agency expense cap in place during the period and therefore should have been paid by CIM out of CIM’s own assets or by the Calvert Funds under a Rule 12b-1 plan. The matter was self-reported to the SEC in 2016.
On May 2, 2017, in acceptance of a settlement proposal by CIM and CID, the SEC issued an administrative order requiring CIM and CID to pay $21,614,534 to affected shareholders of the Calvert Funds, including the Fund. The administrative order also censured CIM and CID and required them to pay a $1 million penalty to the SEC. CIM is in the process of determining the economic impact of misallocated fees on the affected Calvert Funds, including the Fund, and their shareholders, and developing a plan to reimburse eligible shareholders following that determination.
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SPECIAL MEETING OF SHAREHOLDERS (UNAUDITED)
The Special Meeting of Shareholders of Calvert Capital Accumulation Fund, a series of Calvert World Values Fund, Inc. (the “Fund”) was held on December 16, 2016 and adjourned to December 23, 2016, December 28, 2016, January 6, 2017 and January 27, 2017.
Shareholders of the Fund voted on the following proposals:
1. | Approval of a new investment advisory agreement with Calvert Research and Management. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
5,632,932 | 86,160 | 305,435 | 1,220,098 |
2. | Reaffirmation and approval of the Fund’s ability to invest in notes issued by Calvert Social Investment Foundation. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
5,651,257 | 83,973 | 289,297 | 1,220,097 |
3. | Approval of the Fund’s reliance on a potential future exemptive order that may be granted by the U.S. Securities and Exchange Commission. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
5,608,793 | 95,114 | 320,621 | 1,220,096 |
Shareholders of Class A shares of the Fund voted on the following proposal:
1. | Approval of Master Distribution Plan for Class A shares of the Fund pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
2,522,119 | 70,494 | 262,360 | 862,636 |
Shareholders of Class C shares of the Fund voted on the following proposal:
1. | Approval of Master Distribution Plan for Class C shares of the Fund pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
421,623 | 1,361 | 33,238 | 68,816 |
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Shareholders of Calvert World Values Fund, Inc. voted on the following proposal:
1. | To elect Directors of Calvert World Values Fund, Inc.: |
Number of Shares* | ||
Nominee | For | Withheld |
Richard L. Baird, Jr. | 39,776,422 | 1,439,396 |
Alice Gresham Bullock | 39,831,328 | 1,384,490 |
Cari Dominguez | 39,839,990 | 1,375,828 |
Miles D. Harper III | 39,768,678 | 1,447,140 |
John G. Guffey, Jr. | 39,771,630 | 1,444,188 |
Joy V. Jones | 39,842,813 | 1,373,004 |
Anthony A. Williams | 35,278,280 | 5,937,538 |
John H. Streur | 39,768,579 | 1,447,239 |
* | Excludes fractional shares. |
** | Uninstructed shares (i.e., proxies from brokers or nominees indicating that such persons have not received instructions from the beneficial owner or other person entitled to vote shares on a particular matter with respect to which the brokers or nominees do not have discretionary power) were treated as shares that were present at the meeting for purposes of establishing a quorum, but had the effect of a vote against the proposals. Uninstructed shares are sometimes referred to as broker non-votes. Abstentions were also treated in this manner. |
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BOARD APPROVAL OF INVESTMENT ADVISORY AGREEMENT
Calvert Capital Accumulation Fund
At a meeting held on October 14, 2016, the Board of Directors of Calvert World Values Fund, Inc. (“CWVF”), and by a separate vote, the Directors who are not “interested persons” of CWVF (the “Independent Directors”), approved a new Investment Advisory Agreement between CWVF and Eaton Vance Investment Advisors (renamed Calvert Research and Management) (“CRM” or the “Adviser”) with respect to the Calvert Capital Accumulation Fund (the “Fund”). The Board was advised that, subject to shareholder approval and certain other conditions, the new Investment Advisory Agreement would take effect upon the acquisition of substantially all of the business assets of Calvert Investment Management, Inc. (“CIM”) by Eaton Vance Corporation (“Eaton Vance”) (the “Transaction”).
In connection with the proposed Transaction, the Independent Directors, assisted by their independent legal counsel, requested extensive information from CIM and Eaton Vance regarding the proposed Transaction and its potential implications for the Calvert Funds. The Independent Directors reviewed and discussed this information and received advice from their independent legal counsel regarding their responsibilities in evaluating the possible Transaction and the new Investment Advisory Agreement.
The Independent Directors met separately on multiple occasions to discuss the Transaction and the proposed change in investment adviser. The interested Directors participated in portions of these meetings to provide the perspective of the Calvert organization, but did not otherwise participate in the deliberations of the Independent Directors regarding the possible change in investment adviser.
In the course of their deliberations regarding the new Investment Advisory Agreement, the Directors considered the following factors, among others: the nature, extent and quality of the services to be provided by CRM and its affiliates, including the personnel who would be providing such services; Eaton Vance’s financial condition; the proposed advisory fees; comparative fee and expense information for the Calvert Funds and for comparable funds managed by Eaton Vance or its affiliates; the anticipated profitability of the Calvert Funds to CRM and its affiliates; the direct and indirect benefits, if any, to be derived by CRM and its affiliates from their relationship with the Calvert Funds; the effect of each Calvert Fund’s projected growth and size on each Calvert Fund’s performance and expenses; and CRM’s compliance program.
In considering the nature, extent, and quality of the services to be provided to the Fund by CRM under the new Investment Advisory Agreement, the Directors took into account information provided by Eaton Vance or its affiliates relating to its operations and personnel, including, among other information, biographical information on its investment, supervisory, and professional staff and descriptions of its organizational and management structure. The Directors considered the new investment strategies to be used in managing certain Calvert Funds and the performance of other funds managed by the investment teams at Eaton Vance or its affiliates that would be managing certain Calvert Funds. The Directors also took into account CRM’s and Eaton Vance’s proposed staffing and overall resources, and noted that the staff of CRM was expected to include certain current employees of CIM as well as certain employees of affiliates of Eaton Vance under a “dual-hat” arrangement. CRM’s administrative capabilities were also considered. The Directors concluded that they were satisfied with the nature, extent and quality of services to be provided to the Fund by CRM under the new Investment Advisory Agreement.
In considering the management style and investment strategies that CRM proposed to use in managing the Calvert Funds, including the Fund, the Directors took into consideration the performance of funds currently managed by CIM and affiliates of Eaton Vance, as applicable. The Directors also noted that for certain Calvert Funds CRM proposed to combine the investment capabilities of affiliates of Eaton Vance with CRM’s sustainable research capabilities. Based upon their review, the Directors concluded that CRM is qualified to manage the Fund’s assets in accordance with its investment objective and strategies and that the proposed investment strategies were appropriate for pursuing the Fund’s investment objective.
In considering the Fund’s performance, the Board noted that it reviewed on a quarterly basis detailed information about the Fund’s performance results, portfolio composition and investment strategies. The Board also reviewed various comparative data provided to it in connection with its consideration of the new Investment Advisory Agreement, including, comparisons of the Fund’s returns with those of its benchmark and the average of its Lipper category for the one-, three- and five-year periods ended July 31, 2016.
In considering the Fund’s proposed fees and estimated expenses, the Directors considered certain comparative fee and expense data provided by Eaton Vance or its affiliates. The Directors also took into account that there were no increases in the advisory fees being proposed and that for certain Calvert Funds, CRM had proposed a reduction in advisory fees. The Directors further noted that CRM had agreed to maintain current fee waivers/expense reimbursements, if any, for certain Calvert Funds, and increase the fee waivers/expense reimbursements for other Calvert Funds. Based upon their review the Directors concluded that the proposed advisory fee was reasonable in view of the quality of services to be received by the Fund from CRM.
calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED) 29
In reviewing the anticipated profitability of the Fund to CRM and its affiliates, the Directors considered the fact that affiliates of CRM would be providing shareholder servicing, administrative and distribution services to the Fund for which they would receive compensation. The Board also took into account whether CRM had the financial wherewithal to provide services to the Fund. The Board also considered that CRM would likely derive benefits to its reputation and other indirect benefits from its relationship with the Fund. Based upon its review, the Board concluded that CRM’s and its affiliates’ anticipated level of profitability from their relationship with the Fund was reasonable.
The Directors considered the effect of each Calvert Fund’s current size and potential growth on its performance and expenses. The Directors took into account management’s discussion of the Calvert Funds’ proposed advisory fees. The Directors noted that the advisory fee schedule for certain Calvert Funds will contain breakpoints that will reduce the respective advisory fee rate on assets above specified levels as the applicable Calvert Fund’s assets increased and considered the necessity of adding breakpoints with respect to the Calvert Funds that did not currently have such breakpoints in their advisory fee schedule. The Directors determined that adding breakpoints at specified levels to the advisory fee schedules of the Calvert Funds that did not currently have breakpoints, such as the Fund, would not be appropriate at this time. The Directors noted that if the Fund’s assets increased over time, the Fund might realize economies of scale if assets increase proportionally more than certain other expenses.
In considering the approval of the new Investment Advisory Agreement, the Directors also considered the following matters:
(i) their belief that the Transaction will benefit the Calvert Funds, including the Fund;
(ii) CRM’s intention to continue to manage the Fund in a manner materially consistent with the Fund’s existing investment objective and principal investment strategies, which includes continuing to manage the Fund pursuant to responsible investment criteria as described in the prospectus;
(iii) the financial condition and reputation of Eaton Vance and its affiliates, its worldwide presence, experience as a fund sponsor and manager, commitment to maintain a high level of cooperation with, and support to, the Calvert Funds, including the Fund, strong distribution and client service capabilities, and relationships in the asset management industry;
(iv) the intention expressed by representatives of Eaton Vance to retain certain of the existing members of the Calvert management team and other key professionals, including members of the Calvert Sustainability Research Department, in order to better continue principles-based investment research following the closing of the Transaction;
(v) Eaton Vance’s commitment to maintaining competitive compensation arrangements to attract and retain highly qualified personnel; and
(vi) that the current senior management team at Calvert has indicated its strong support of the Transaction.
In approving the new Investment Advisory Agreement with CRM, the Directors did not identify any single factor as controlling, and each Director may have attributed different weight to various factors.
The Directors reached the following conclusions regarding the new Investment Advisory Agreement, among others: (a) CRM has demonstrated that it possesses the capability and resources to perform the duties required of it under the Investment Advisory Agreement; (b) CRM is qualified to manage the Fund’s assets in accordance with the Fund’s investment objective and strategies; (c) CRM’s investment strategies are appropriate for pursuing the Fund’s investment objective; and (d) the advisory fees are reasonable in view of the quality of the services to be received by the Fund from CRM. Based on the foregoing considerations, the Directors, including the Independent Directors, approved the new Investment Advisory Agreement, subject to the approval of the Fund’s shareholders.
30 calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED)
OFFICERS AND DIRECTORS
Officers of Calvert Capital Accumulation Fund
Hope Brown
Chief Compliance Officer
Maureen A. Gemma(1)
Secretary and Vice President
James F. Kirchner(1)
Treasurer
Directors of Calvert Capital Accumulation Fund
Alice Gresham Bullock(2)(4)
Chairperson
Richard L. Baird, Jr.(4)
Cari Dominguez(2)(4)
John G. Guffey, Jr.(4)
Miles D. Harper, III(4)
Joy V. Jones(4)
John H. Streur(3)
Anthony A. Williams(2)(4)
(1)Ms. Gemma and Mr. Kirchner began serving as Officers effective December 31, 2016.
(2)Mmes. Bullock and Dominguez and Mr. Williams began serving as Directors effective December 23, 2016.
(3)Interested Director and President
(4)Independent Director
calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED) 31
IMPORTANT NOTICES
Privacy. The Calvert organization is committed to ensuring your financial privacy. Each of the financial institutions identified below has in effect the following policy (“Privacy Policy”) with respect to nonpublic personal information about its customers:
• | Only such information received from you, through application forms or otherwise, and information about your Calvert fund transactions will be collected. This may include information such as name, address, social security number, tax status, account balances and transactions. |
• | None of such information about you (or former customers) will be disclosed to anyone, except as permitted by law (which includes disclosure to employees necessary to service your account). In the normal course of servicing a customer’s account, the Calvert organization may share information with unaffiliated third parties that perform various required services such as transfer agents, custodians and broker-dealers. |
• | Policies and procedures (including physical, electronic and procedural safeguards) are in place that are designed to protect the confidentiality of such information. |
• | We reserve the right to change our Privacy Policy at any time upon proper notification to you. Customers may want to review our Privacy Policy periodically for changes by accessing the link on our homepage: www.Calvert.com. |
Our pledge of privacy applies to the following entities within the Calvert organization: the Calvert Family of funds and Calvert Research and Management. In addition, our Privacy Policy applies only to those Calvert customers who are individuals and who have a direct relationship with us. If a customer’s account (i.e., fund shares) is held in the name of a third-party financial adviser/broker-dealer, it is likely that only such advisor’s privacy policies apply to the customer. This notice supersedes all previously issued privacy disclosures. For more information about Calvert’s Privacy Policy, please call 1-800-368-2745.
Delivery of Shareholder Documents. The Securities and Exchange Commission (SEC) permits funds to deliver only one copy of shareholder documents, including prospectuses, proxy statements and shareholder reports, to fund investors with multiple accounts at the same residential or post office box address. This practice is often called “householding” and it helps eliminate duplicate mailings to shareholders. Calvert funds, or your financial advisor, may household the mailing of your documents indefinitely unless you instruct Calvert funds, or your financial advisor, otherwise. If you would prefer that your Calvert fund documents not be householded, please contact Calvert funds at 1-800-368-2745, or contact your financial advisor. Your instructions that householding not apply to delivery of your Calvert fund documents will typically be effective within 30 days of receipt by Calvert funds or your financial advisor. Separate statements will be generated for each separate account and will be householded as described above.
Portfolio Holdings. Each Calvert fund will file a schedule of portfolio holdings on Form N-Q with the SEC for the first and third quarters of each fiscal year. The Form N-Q will be available on the Calvert funds’ website at www.calvert.com, by calling Calvert funds at 1-800-368-2745 or in the EDGAR database on the SEC’s website at www.sec.gov. Form N-Q may also be reviewed and copied at the SEC’s public reference room in Washington, D.C. (call 1-800-732-0330 for information on the operation of the public reference room).
Proxy Voting. The Proxy Voting Guidelines that each Calvert fund uses to determine how to vote proxies relating to portfolio securities is provided as an Appendix to the fund’s Statement of Additional Information. The Statement of Additional Information can be obtained free of charge by calling the Calvert funds at 1-800-368-2745, by visiting the Calvert funds’ website at www.calvert.com or visiting the SEC’s website at www.sec.gov. Information regarding how a Calvert fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available by calling Calvert funds, by visiting the Calvert funds’ website at www.calvert.com or by visiting the SEC’s website at www.sec.gov.
32 calvert.com CALVERT CAPITAL ACCUMULATION FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT CAPITAL ACCUMULATION FUND | CALVERT’S FAMILY OF FUNDS | |||
Service for Existing Account Shareholders: 800-368-2745 Brokers: 800-368-2746 Regular Mail Calvert Funds c/o BFDS P.O. Box 219544 Kansas City, MO 64121-9544 Overnight Mail Calvert Funds c/o BFDS 330 West 9th Street Kansas City, MO 64105-1514 Web Site calvert.com Principal Underwriter* Eaton Vance Distributors, Inc. Two International Place Boston, MA 02110 | Municipal Funds Tax-Free Responsible Impact Bond Fund Taxable Bond Funds Bond Portfolio Income Fund Short Duration Income Fund Long-Term Income Fund Ultra-Short Income Fund High Yield Bond Fund Green Bond Fund Unconstrained Bond Fund Balanced and Asset Allocation Funds Balanced Portfolio Conservative Allocation Fund Moderate Allocation Fund Aggressive Allocation Fund | Equity Funds Equity Portfolio U.S. Large Cap Core Responsible Index Fund U.S. Large Cap Value Responsible Index Fund U.S. Large Cap Growth Responsible Index Fund U.S. Mid Cap Core Responsible Index Fund Developed Markets Ex-U.S. Responsible Index Fund Capital Accumulation Fund International Equity Fund Small Cap Fund Global Energy Solutions Fund Global Water Fund International Opportunities Fund Emerging Markets Equity Fund |
* FINRA BrokerCheck. Investors may check the background of their Investment Professional by contacting the Financial Industry Regulatory Authority (FINRA). FINRA BrokerCheck is a free tool to help investors check the professional background of current and former FINRA-registered securities firms and brokers. FINRA BrokerCheck is available by calling 1-800-289-9999 and at www.FINRA.org. The FINRA BrokerCheck brochure describing this program is available to investors at www.FINRA.org.
Fund shares are not insured by the FDIC and are not deposits or other obligations of, or guaranteed by, any depository institution. Shares are subject to investment risks, including possible loss of principal invested. This report is intended to provide fund information to shareholders. It is not authorized for distribution to prospective investors unless preceded or accompanied by a prospectus. Note: The information on our website is not incorporated by reference into this report; our website address is included as an inactive textual reference only. Investors should carefully consider the investment objectives, risks, charges and expenses of the Calvert funds. This and other important information is contained in the fund’s summary prospectus and prospectus, which can be obtained from your financial professional and should be read carefully before investing. You may also call Calvert funds at 800-368-2745. Printed on recycled paper. | |
24210 3.31.17 |
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Calvert International Opportunities Fund | ![]() | |
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Semiannual Report March 31, 2017 E-Delivery Sign-Up — Details Inside | ![]() |
Choose Planet-friendly E-delivery! Sign up now for on-line statements, prospectuses, and fund reports. In less than five minutes you can help reduce paper mail and lower fund costs. Just go to calvert.com. If you already have an online account at Calvert, click on Login, to access your Account, and select the documents you would like to receive via e-mail. If you’re new to online account access, click on Login, then Register to create your user name and password. Once you’re in, click on the E-delivery sign-up on the Account Portfolio page and follow the quick, easy steps. Note: if your shares are not held directly at Calvert but through a brokerage firm, you must contact your broker for electronic delivery options available through their firm. |
PERFORMANCE AND FUND PROFILE
Performance1,2 | ||||||||||||||||
Portfolio Managers Aidan M. Farrell of Eaton Vance Management (International) Limited; Christopher Madden, CFA and Jade Huang, each of Calvert Research and Management | ||||||||||||||||
% Average Annual Total Returns | Class Inception Date | Performance Inception Date | Six Months | One Year | Five Years | Since Inception | ||||||||||
Class A at NAV | 05/31/2007 | 05/31/2007 | 6.62 | % | 9.20 | % | 7.97 | % | 2.12 | % | ||||||
Class A with 4.75% Maximum Sales Charge | — | — | 1.54 | 4.02 | 6.93 | 1.61 | ||||||||||
Class C at NAV | 07/31/2007 | 05/31/2007 | 6.10 | 8.12 | 7.00 | 1.26 | ||||||||||
Class C with 1% Maximum Sales Charge | — | — | 5.10 | 7.12 | 7.00 | 1.26 | ||||||||||
Class I at NAV | 05/31/2007 | 05/31/2007 | 6.82 | 9.46 | 8.42 | 2.56 | ||||||||||
Class Y at NAV | 10/31/2008 | 05/31/2007 | 6.77 | 9.47 | 8.23 | 2.32 | ||||||||||
MSCI EAFE SMID Cap Index | — | — | 5.00 | % | 10.04 | % | 8.30 | % | 1.74 | % | ||||||
Ticker Symbol | Class A | Class C | Class I | Class Y | ||||||||||||
CIOAX | COICX | COIIX | CWVYX | |||||||||||||
% Total Annual Operating Expense Ratios3 | Class A | Class C | Class I | Class Y | ||||||||||||
Gross | 1.43 | % | 2.61 | % | 1.16 | % | 1.15 | % | ||||||||
Net | 1.43 | 2.26 | 1.16 | 1.15 |
Fund Profile | |||||||
SECTOR ALLOCATION (% of total investments)4 | TEN LARGEST STOCK HOLDINGS (% of net assets) | ||||||
Industrials | 27.9 | % | Eiken Chemical Co. Ltd. | 1.6 | % | ||
Consumer Discretionary | 16.1 | % | Frutarom Industries Ltd. | 1.6 | % | ||
Financials | 11.8 | % | IWG plc | 1.6 | % | ||
Real Estate | 9.2 | % | Moncler SpA | 1.5 | % | ||
Health Care | 8.3 | % | Daifuku Co. Ltd. | 1.5 | % | ||
Information Technology | 8.0 | % | Nomura Co. Ltd. | 1.5 | % | ||
Materials | 7.2 | % | Inchcape plc | 1.5 | % | ||
Consumer Staples | 6.4 | % | Metropole Television S.A. | 1.5 | % | ||
Utilities | 1.7 | % | IMCD Group NV | 1.4 | % | ||
Energy | 1.2 | % | CAE, Inc. | 1.4 | % | ||
Telecommunication Services | 1.1 | % | Total | 15.1 | % | ||
High Social Impact Investments | 0.7 | % | |||||
Time Deposit | 0.4 | % | |||||
Total | 100.0 | % |
See Endnotes and Additional Disclosures in this report.
Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value (NAV) or offering price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance less than or equal to one year is cumulative. Performance is for the stated time period only; due to market volatility, the Fund's current performance may be lower or higher than quoted. Returns are before taxes unless otherwise noted. For performance as of the most recent month-end, please refer to calvert.com.
2 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
Endnotes and Additional Disclosures | ||
1 MSCI EAFE SMID Cap Index is an unmanaged index of small & mid-capitalization equities in the developed markets, excluding the U.S. and Canada. MSCI indexes are net of foreign withholding taxes. Source: MSCI. MSCI data may not be reproduced or used for any other purpose. MSCI provides no warranties, has not prepared or approved this report, and has no liability hereunder. Unless otherwise stated, index returns do not reflect the effect of any applicable sales charges, commissions, expenses, taxes or leverage, as applicable. It is not possible to invest directly in an index. 2 Total Returns at NAV do not include applicable sales charges. If sales charges were deducted, the returns would be lower. Total Returns shown with maximum sales charge reflect the stated maximum sales charge. Unless otherwise stated, performance does not reflect the deduction of taxes on Fund distributions or redemptions of Fund shares.Performance prior to the inception date of a class may be linked to the performance of an older class of the Fund. This linked performance is adjusted for any applicable sales charge, but is not adjusted for class expense differences. If adjusted for such differences, the performance would be different. The performance of Class C and Class Y is linked to Class A. Performance since inception for an index, if presented, is the performance since the Fund’s or oldest share class’ inception, as applicable. Performance presented in the Financial Highlights included in the financial statements is not linked. 3 Source: Fund prospectus. Net expense ratios reflect a contractual expense reimbursement that continues through 1/31/18. Without the reimbursement, performance would have been lower. The expense ratios for the current reporting period can be found in the Financial Highlights section of this report.4 Does not include Short Term Investment of Cash Collateral for Securities Loaned.Fund profile subject to change due to active management. |
calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED) 3
UNDERSTANDING YOUR FUND'S EXPENSES
As an investor, you incur two types of costs. There are transaction costs, which generally include sales charges (loads) on purchases and may include redemption fees. There are also ongoing costs, which generally include management fees, distribution and/or service fees, and other fund expenses. The following information is intended to help you understand your ongoing costs (in dollars) of investing in this mutual fund and to help you compare these costs with the ongoing costs of investing in other mutual funds.
To illustrate these ongoing costs, we have provided examples and calculated the expenses paid by the Fund's investors during the period. The actual and hypothetical information presented in the examples is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (October 1, 2016 to March 31, 2017).
Actual Expenses
The first line for each class of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 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.
Hypothetical Example for Comparison Purposes
The second line for each class of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and 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 the Fund and other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the 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 sales charges (loads) or redemption fees, if applicable. 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.
ANNUALIZED EXPENSE RATIO | BEGINNING ACCOUNT VALUE 10/1/16 | ENDING ACCOUNT VALUE 3/31/17 | EXPENSES PAID DURING PERIOD* 10/1/16 - 3/31/17 | |
Class A | ||||
Actual | 1.41% | $1,000.00 | $1,066.20 | $7.26 |
Hypothetical (5% return per year before expenses) | 1.41% | $1,000.00 | $1,017.90 | $7.09 |
Class C | ||||
Actual | 2.34% | $1,000.00 | $1,061.00 | $12.02 |
Hypothetical (5% return per year before expenses) | 2.34% | $1,000.00 | $1,013.26 | $11.75 |
Class I | ||||
Actual | 1.09% | $1,000.00 | $1,068.20 | $5.62 |
Hypothetical (5% return per year before expenses) | 1.09% | $1,000.00 | $1,019.50 | $5.49 |
Class Y | ||||
Actual | 1.19% | $1,000.00 | $1,067.70 | $6.13 |
Hypothetical (5% return per year before expenses) | 1.19% | $1,000.00 | $1,019.00 | $5.99 |
* Expenses paid during the period are equal to the annualized expense ratio for each class as indicated above, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). |
4 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL OPPORTUNITIES FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2017 (Unaudited)
SHARES | VALUE ($) | |
COMMON STOCKS - 97.8% | ||
Australia - 6.0% | ||
Amaysim Australia Ltd. | 320,442 | 465,066 |
BlueScope Steel Ltd. | 58,153 | 545,169 |
Challenger Ltd. | 95,286 | 913,266 |
GDI Property Group | 612,135 | 488,639 |
InvoCare Ltd. | 78,767 | 850,676 |
IOOF Holdings Ltd. | 129,732 | 845,356 |
iSentia Group Ltd. (a) | 793,409 | 909,334 |
Mirvac Group | 641,727 | 1,073,621 |
Super Retail Group Ltd. | 218,615 | 1,712,326 |
Tox Free Solutions Ltd. (a) | 1,271,472 | 2,263,372 |
10,066,825 | ||
Austria - 1.7% | ||
ams AG | 37,951 | 2,050,125 |
CA Immobilien Anlagen AG * | 32,383 | 710,797 |
2,760,922 | ||
Belgium - 2.9% | ||
Kinepolis Group NV | 36,857 | 1,879,344 |
Melexis NV | 21,619 | 1,871,847 |
Warehouses De Pauw CVA | 12,492 | 1,161,623 |
4,912,814 | ||
Canada - 1.4% | ||
CAE, Inc. | 156,290 | 2,388,099 |
China - 0.6% | ||
TAL Education Group (ADR) * | 8,864 | 944,636 |
Denmark - 0.6% | ||
Topdanmark AS * | 40,822 | 1,035,197 |
Finland - 1.1% | ||
Amer Sports Oyj * | 81,656 | 1,846,283 |
France - 6.2% | ||
Criteo S.A. (ADR) * | 29,983 | 1,498,850 |
Eutelsat Communications S.A. | 36,699 | 817,930 |
Ipsen S.A. | 22,229 | 2,222,501 |
Metropole Television S.A. | 109,136 | 2,432,858 |
Nexity S.A. * | 23,156 | 1,138,429 |
Rubis SCA | 14,752 | 1,444,335 |
calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED) 5
SHARES | VALUE ($) | |||
COMMON STOCKS - CONT’D | ||||
Solocal Group * | 712,410 | 756,855 | ||
10,311,758 | ||||
Germany - 7.1% | ||||
Bertrandt AG | 17,724 | 1,720,803 | ||
Brenntag AG | 34,050 | 1,908,388 | ||
Carl Zeiss Meditec AG | 17,877 | 762,983 | ||
Freenet AG | 41,107 | 1,336,214 | ||
Hypoport AG * | 11,725 | 1,096,389 | ||
Norma Group SE | 37,340 | 1,763,463 | ||
Rational AG | 2,649 | 1,235,610 | ||
Salzgitter AG | 17,205 | 621,901 | ||
Scout24 AG *(b) | 44,187 | 1,475,278 | ||
11,921,029 | ||||
Hong Kong - 0.8% | ||||
Hysan Development Co. Ltd. | 286,304 | 1,298,919 | ||
Ireland - 2.0% | ||||
Irish Residential Properties REIT plc | 920,100 | 1,217,138 | ||
UDG Healthcare plc | 236,214 | 2,074,157 | ||
3,291,295 | ||||
Israel - 1.6% | ||||
Frutarom Industries Ltd. | 47,002 | 2,626,902 | ||
Italy - 5.8% | ||||
Amplifon SpA | 142,876 | 1,720,556 | ||
Banca Generali SpA | 41,729 | 1,090,704 | ||
FinecoBank Banca Fineco SpA | 183,278 | 1,246,373 | ||
Industria Macchine Automatiche SpA | 20,108 | 1,637,254 | ||
MARR SpA | 66,821 | 1,444,602 | ||
Moncler SpA | 118,583 | 2,597,713 | ||
9,737,202 | ||||
Japan - 27.5% | ||||
77 Bank Ltd. (The) | 319,768 | 1,387,227 | ||
Advance Residence Investment Corp. | 407 | 1,115,377 | ||
Ariake Japan Co. Ltd. | 26,214 | 1,653,524 | ||
Asahi Co. Ltd. | 103,997 | 1,213,850 | ||
Asahi Intecc Co. Ltd. | 47,728 | 1,986,221 | ||
Daifuku Co. Ltd. | 102,453 | 2,562,492 | ||
Daiichikosho Co. Ltd. | 30,863 | 1,242,553 | ||
Dowa Holdings Co. Ltd. | 50,063 | 360,192 | ||
Eiken Chemical Co. Ltd. | 95,109 | 2,640,957 | ||
FP Corp. | 41,917 | 1,960,258 | ||
Fuji Seal International, Inc. | 86,697 | 1,878,779 | ||
GMO internet, Inc. | 164,011 | 1,943,723 | ||
HIS Co. Ltd. | 28,500 | 665,589 | ||
Like Co. Ltd. | 80,429 | 2,066,514 | ||
Morinaga & Co. Ltd. | 52,464 | 2,329,165 |
6 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
SHARES | VALUE ($) | |||
COMMON STOCKS - CONT’D | ||||
Nippon Light Metal Holdings Co. Ltd. | 180,046 | 397,372 | ||
Nishi-Nippon Financial Holdings, Inc. | 125,619 | 1,263,208 | ||
Nomura Co. Ltd. | 143,794 | 2,541,280 | ||
Oyo Corp. | 33,803 | 420,272 | ||
Penta-Ocean Construction Co. Ltd. | 272,311 | 1,317,897 | ||
Relia, Inc. | 199,880 | 1,971,546 | ||
Sakata INX Corp. | 110,303 | 1,522,195 | ||
Sakata Seed Corp. | 70,248 | 2,207,502 | ||
Sanden Holdings Corp. * | 595,612 | 1,985,463 | ||
Sumco Corp. | 50,500 | 843,563 | ||
Sun Frontier Fudousan Co. Ltd. | 107,856 | 942,479 | ||
Tokyo Century Corp. | 47,357 | 1,614,457 | ||
Tokyu REIT, Inc. | 681 | 857,446 | ||
Tosei Corp. | 142,441 | 939,220 | ||
UACJ Corp. | 138,488 | 363,885 | ||
Yokohama Reito Co. Ltd. | 175,414 | 1,746,014 | ||
45,940,220 | ||||
Netherlands - 3.5% | ||||
Aalberts Industries NV | 61,801 | 2,303,669 | ||
IMCD Group NV | 48,971 | 2,407,323 | ||
Refresco Group NV (b) | 79,158 | 1,203,331 | ||
5,914,323 | ||||
New Zealand - 0.6% | ||||
Fisher & Paykel Healthcare Corp. Ltd. | 143,421 | 974,603 | ||
Norway - 2.0% | ||||
SpareBank 1 SR-Bank ASA | 219,422 | 1,637,724 | ||
XXL ASA (b) | 149,277 | 1,626,339 | ||
3,264,063 | ||||
Singapore - 1.0% | ||||
Frasers Centrepoint Trust | 704,478 | 1,061,934 | ||
SIIC Environment Holdings Ltd. * | 1,324,028 | 525,314 | ||
1,587,248 | ||||
Spain - 1.3% | ||||
Acciona SA | 11,426 | 913,894 | ||
Hispania Activos Inmobiliarios SOCIMI SA | 92,474 | 1,326,888 | ||
2,240,782 | ||||
Sweden - 3.0% | ||||
Avanza Bank Holding AB | 18,270 | 686,324 | ||
Indutrade AB | 109,134 | 2,078,516 | ||
Trelleborg AB, Class B | 108,399 | 2,320,675 | ||
5,085,515 | ||||
Switzerland - 4.3% | ||||
Belimo Holding AG | 303 | 1,058,753 | ||
IWG plc | 655,203 | 2,617,558 |
calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED) 7
SHARES | VALUE ($) | |||
COMMON STOCKS - CONT’D | ||||
Temenos Group AG | 22,293 | 1,770,618 | ||
Vontobel Holding AG | 17,020 | 973,639 | ||
VZ Holding AG | 2,586 | 709,979 | ||
7,130,547 | ||||
United Kingdom - 16.8% | ||||
Aldermore Group plc * | 418,692 | 1,166,259 | ||
Bellway plc | 42,312 | 1,433,646 | ||
Bodycote plc | 177,338 | 1,769,286 | ||
Derwent London plc | 16,597 | 584,666 | ||
DS Smith plc | 311,366 | 1,693,985 | ||
Hastings Group Holdings plc (b) | 330,009 | 1,120,086 | ||
Hiscox Ltd. | 113,452 | 1,555,100 | ||
Inchcape plc | 233,647 | 2,463,338 | ||
John Wood Group plc | 204,630 | 1,954,851 | ||
Melrose Industries plc | 835,459 | 2,334,246 | ||
Softcat plc | 160,354 | 791,576 | ||
Spirax-Sarco Engineering plc | 30,515 | 1,824,193 | ||
Spire Healthcare Group plc (b) | 323,255 | 1,312,079 | ||
St James's Place plc | 92,324 | 1,228,919 | ||
Travis Perkins plc | 120,593 | 2,287,767 | ||
UNITE Group plc (The) | 150,784 | 1,202,459 | ||
Weir Group plc (The) | 55,222 | 1,328,375 | ||
WH Smith plc | 92,660 | 2,058,826 | ||
28,109,657 | ||||
Total Common Stocks (Cost $154,625,379) | 163,388,839 | |||
PRINCIPAL AMOUNT ($) | VALUE ($) | |||
HIGH SOCIAL IMPACT INVESTMENTS - 0.7% | ||||
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 (c)(d) | 1,000,000 | 935,790 | ||
ImpactAssets Inc., Global Sustainable Agriculture Notes, 0.00%, 11/3/20 (c)(e)(f) | 111,000 | 98,790 | ||
ImpactAssets Inc., Microfinance Plus Notes, 0.00%, 11/3/20 (c)(e)(f) | 142,000 | 133,480 | ||
Total High Social Impact Investments (Cost $1,253,000) | 1,168,060 | |||
TIME DEPOSIT - 0.4% | ||||
State Street Bank and Trust Eurodollar Time Deposit, 0.09%, 4/3/17 | 731,190 | 731,190 | ||
Total Time Deposit (Cost $731,190) | 731,190 |
8 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
SHARES | VALUE ($) | |||
SHORT TERM INVESTMENT OF CASH COLLATERAL FOR SECURITIES LOANED - 0.3% | ||||
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.62% | 465,634 | 465,634 | ||
Total Short Term Investment of Cash Collateral For Securities Loaned (Cost $465,634) | 465,634 | |||
TOTAL INVESTMENTS (Cost $157,075,203) - 99.2% | 165,753,723 | |||
Other assets and liabilities, net - 0.8% | 1,414,386 | |||
NET ASSETS - 100.0% | 167,168,109 |
At March 31, 2017, the concentration of the Fund’s investments in the various sectors, determined as a percentage of total investments, was as follows: | ||
ECONOMIC SECTORS | % OF TOTAL INVESTMENTS* | |
Industrials | 27.9 | % |
Consumer Discretionary | 16.1 | % |
Financials | 11.8 | % |
Real Estate | 9.2 | % |
Health Care | 8.3 | % |
Information Technology | 8.0 | % |
Materials | 7.2 | % |
Consumer Staples | 6.4 | % |
Utilities | 1.7 | % |
Energy | 1.2 | % |
Telecommunication Services | 1.1 | % |
High Social Impact Investments | 0.7 | % |
Time Deposit | 0.4 | % |
Total | 100.0 | % |
*Does not include Short Term Investment of Cash Collateral for Securities Loaned. |
NOTES TO SCHEDULE OF INVESTMENTS | |
* Non-income producing security. | |
(a) Security, or portion of security, is on loan. Total value of securities on loan is $429,060 as of March 31, 2017. | |
(b) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. Total market value of Rule 144A securities amounts to $6,737,113, which represents 4.0% of the net assets of the Fund as of March 31, 2017. | |
(c) Restricted Security. Total market value of restricted securities amounts to $1,168,060, which represents 0.7% of the net assets of the Fund as of March 31, 2017. | |
(d) Affiliated company (see Note F). | |
(e) For fair value measurement disclosure purposes, security is categorized as Level 3 (see Note A). | |
(f) Notes carry an interest rate that varies by period and is contingent on the performance of the underlying portfolio of loans to borrowers. The coupon rate shown represents the rate in effect at March 31, 2017. | |
Abbreviations: | |
ADR: | American Depositary Receipts |
See notes to financial statements. |
calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED) 9
RESTRICTED SECURITIES | ACQUISITION DATES | COST ($) |
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 | 12/15/16 | 1,000,000 |
ImpactAssets Inc., Global Sustainable Agriculture Notes, 0.00%, 11/3/20 | 11/13/15 | 111,000 |
ImpactAssets Inc., Microfinance Plus Notes, 0.00%, 11/3/20 | 11/13/15 | 142,000 |
See notes to financial statements. |
10 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL OPPORTUNITIES FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 2017 (Unaudited)
ASSETS | |||
Investments in unaffiliated securities, at value (Cost $156,075,203) - see accompanying schedule | $164,817,933 | ||
Investments in affiliated securities, at value (Cost $1,000,000) - see accompanying schedule | 935,790 | ||
Foreign currency, at value (Cost $1,319,402) | 1,377,710 | ||
Receivable for securities sold | 2,257,345 | ||
Receivable for Fund shares sold | 236,049 | ||
Dividends and interest receivable | 476,878 | ||
Interest receivable - affiliated | 4,458 | ||
Securities lending income receivable | 14,510 | ||
Directors' deferred compensation plan | 118,356 | ||
Tax reclaims receivable | 141,230 | ||
Receivable from affiliate | 1,347 | ||
Total assets | 170,381,606 | ||
LIABILITIES | |||
Payable for securities purchased | 1,984,704 | ||
Collateral for securities loaned | 465,634 | ||
Payable for Fund shares redeemed | 364,683 | ||
Payable to affiliates: | |||
Investment advisory fee | 136,123 | ||
Administrative fees | 21,780 | ||
Distribution Plan expenses | 23,845 | ||
Sub-transfer agent fee | 2,273 | ||
Directors' fees and expenses | 4,179 | ||
Directors' deferred compensation plan | 118,356 | ||
Accrued expenses and other liabilities | 91,920 | ||
Total liabilities | 3,213,497 | ||
NET ASSETS | $167,168,109 | ||
NET ASSETS CONSIST OF: | |||
Paid-in capital applicable to common stock | |||
(250,000,000 shares of $0.01 par value authorized) | $154,346,736 | ||
Accumulated distributions in excess of net investment income | (963,049 | ) | |
Accumulated net realized gain (loss) | 5,054,350 | ||
Net unrealized appreciation (depreciation) | 8,730,072 | ||
NET ASSETS | $167,168,109 | ||
NET ASSET VALUE PER SHARE | |||
Class A (based on net assets of $43,072,274 and 2,762,364 shares outstanding) | $15.59 | ||
Class C (based on net assets of $4,988,837 and 325,961 shares outstanding) | $15.31 | ||
Class I (based on net assets of $88,570,263 and 5,780,222 shares outstanding) | $15.32 | ||
Class Y (based on net assets of $30,536,735 and 2,048,328 shares outstanding) | $14.91 | ||
See notes to financial statements. |
calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED) 11
CALVERT INTERNATIONAL OPPORTUNITIES FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 2017 (Unaudited) - CONT’D
OFFERING PRICE PER SHARE* | |||
Class A (100/95.25 of net asset value per share) | $16.37 | ||
* On sales of $50,000 or more, the offering price of Class A shares is reduced. |
See notes to financial statements.
12 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL OPPORTUNITIES FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED MARCH 31, 2017 (Unaudited)
NET INVESTMENT INCOME | |||
Investment Income: | |||
Dividend income (net of foreign taxes withheld of $91,057) | $1,321,903 | ||
Securities lending income | 39,742 | ||
Interest income | 8,307 | ||
Interest income - affiliated | 5,430 | ||
Other income | 418 | ||
Total investment income | 1,375,800 | ||
Expenses: | |||
Investment advisory fee | 812,115 | ||
Administrative fees | 129,938 | ||
Transfer agency fees and expenses: | |||
Class A | 60,641 | ||
Class C | 7,517 | ||
Class I | 2,729 | ||
Class Y | 18,766 | ||
Distribution Plan expenses: | |||
Class A | 124,836 | ||
Class C | 24,146 | ||
Directors' fees and expenses | 9,669 | ||
Accounting fees | 33,604 | ||
Custodian fees | 73,196 | ||
Professional fees | 22,379 | ||
Registration fees: | |||
Class A | 8,180 | ||
Class C | 6,208 | ||
Class I | 18,868 | ||
Class Y | 9,541 | ||
Reports to shareholders | 10,089 | ||
Miscellaneous | 22,664 | ||
Total expenses | 1,395,086 | ||
Reimbursement from Adviser: | |||
Class C | (6,282) | ||
Net expenses | 1,388,804 | ||
NET INVESTMENT INCOME (LOSS) | (13,004) | ||
REALIZED AND UNREALIZED GAIN (LOSS) | |||
Net realized gain (loss) on: | |||
Investments (net of foreign capital gains taxes of $5,919) | 14,588,508 | ||
Foreign currency transactions | (316,099) | ||
14,272,409 | |||
See notes to financial statements. |
calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED) 13
CALVERT INTERNATIONAL OPPORTUNITIES FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED MARCH 31, 2017 (Unaudited) - CONT’D
REALIZED AND UNREALIZED GAIN (LOSS) - CONT’D | |||
Net change in unrealized appreciation (depreciation) on: | |||
Investments (including net decrease in payable for foreign capital gains taxes of $32,676) | (171,798) | ||
Investments in affiliated securities | (47,410) | ||
Foreign currency | 41,424 | ||
(177,784) | |||
NET REALIZED AND UNREALIZED GAIN (LOSS) | 14,094,625 | ||
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $14,081,621 |
See notes to financial statements.
14 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL OPPORTUNITIES FUND
STATEMENTS OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS | SIX MONTHS ENDED MARCH 31, 2017 (Unaudited) | YEAR ENDED SEPTEMBER 30, 2016 | |||||
Operations: | |||||||
Net investment income (loss) | ($13,004 | ) | $2,304,455 | ||||
Net realized gain (loss) | 14,272,409 | (8,901,588) | |||||
Net change in unrealized appreciation (depreciation) | (177,784) | 18,266,068 | |||||
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | 14,081,621 | 11,668,935 | |||||
Distributions to shareholders from: | |||||||
Net investment income: | |||||||
Class A shares | (1,050,800) | (768,140) | |||||
Class C shares | (3,184) | — | |||||
Class I shares | (1,136,929) | (496,125) | |||||
Class Y shares | (418,018) | (389,709) | |||||
Net realized gain: | |||||||
Class A shares | — | (3,241,863) | |||||
Class C shares | — | (173,186) | |||||
Class I shares | — | (1,423,627) | |||||
Class Y shares | — | (1,206,553) | |||||
Total distributions | (2,608,931) | (7,699,203) | |||||
Capital share transactions: | |||||||
Shares sold: | |||||||
Class A shares | 9,728,000 | 22,584,870 | |||||
Class C shares | 352,853 | 979,800 | |||||
Class I shares | 23,350,866 | 32,818,157 | |||||
Class Y shares | 11,413,017 | 21,954,857 | |||||
Reinvestment of distributions: | |||||||
Class A shares | 961,581 | 3,890,741 | |||||
Class C shares | 2,718 | 145,104 | |||||
Class I shares | 1,136,295 | 1,919,524 | |||||
Class Y shares | 366,604 | 1,463,650 | |||||
Shares redeemed: | |||||||
Class A shares | (80,205,485) | (20,644,340) | |||||
Class C shares | (690,669) | (1,141,960) | |||||
Class I shares | (10,012,906) | (7,968,411) | |||||
Class Y shares | (28,080,760) | (11,668,455) | |||||
Total capital share transactions | (71,677,886) | 44,333,537 | |||||
TOTAL INCREASE (DECREASE) IN NET ASSETS | (60,205,196) | 48,303,269 | |||||
See notes to financial statements. |
calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED) 15
CALVERT INTERNATIONAL OPPORTUNITIES FUND
STATEMENTS OF CHANGES IN NET ASSETS - CONT’D
NET ASSETS | SIX MONTHS ENDED MARCH 31, 2017 (Unaudited) | YEAR ENDED SEPTEMBER 30, 2016 | |||||
Beginning of period | 227,373,305 | 179,070,036 | |||||
End of period (including accumulated undistributed (distributions in excess of) net investment income of ($963,049) and $1,658,886, respectively) | $167,168,109 | $227,373,305 | |||||
CAPITAL SHARE ACTIVITY | |||||||
Shares sold: | |||||||
Class A shares | 667,665 | 1,580,346 | |||||
Class C shares | 24,351 | 69,185 | |||||
Class I shares | 1,632,004 | 2,361,433 | |||||
Class Y shares | 801,337 | 1,595,580 | |||||
Reinvestment of distributions: | |||||||
Class A shares | 67,243 | 269,484 | |||||
Class C shares | 193 | 10,313 | |||||
Class I shares | 80,932 | 134,648 | |||||
Class Y shares | 26,818 | 105,706 | |||||
Shares redeemed: | |||||||
Class A shares | (5,242,473) | (1,433,519) | |||||
Class C shares | (47,726) | (82,681) | |||||
Class I shares | (692,910) | (574,598) | |||||
Class Y shares | (1,999,716) | (861,049) | |||||
Total capital share activity | (4,682,282) | 3,174,848 | |||||
See notes to financial statements. |
16 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL OPPORTUNITIES FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS A SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012 | ||||||||||||
Net asset value, beginning | $14.78 | $14.58 | $16.42 | $15.76 | $12.59 | $10.57 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income (loss) | (0.02) | 0.15(b) | 0.14 | 0.15 | 0.14 | 0.13 | |||||||||||
Net realized and unrealized gain (loss) | 0.98 | 0.63 | (0.83) | 0.66 | 3.19 | 2.01 | |||||||||||
Total from investment operations | 0.96 | 0.78 | (0.69) | 0.81 | 3.33 | 2.14 | |||||||||||
Distributions from: | |||||||||||||||||
Net investment income | (0.15) | (0.11) | (0.18) | (0.15) | (0.16) | (0.12) | |||||||||||
Net realized gain | — | (0.47) | (0.97) | — | — | — | |||||||||||
Total distributions | (0.15) | (0.58) | (1.15) | (0.15) | (0.16) | (0.12) | |||||||||||
Total increase (decrease) in net asset value | 0.81 | 0.20 | (1.84) | 0.66 | 3.17 | 2.02 | |||||||||||
Net asset value, ending | $15.59 | $14.78 | $14.58 | $16.42 | $15.76 | $12.59 | |||||||||||
Total return (c) | 6.62 | % | 5.49 | % | (4.32 | %) | 5.14 | % | 26.70 | % | 20.52 | % | |||||
Ratios to average net assets: (d) | |||||||||||||||||
Net investment income (loss) | (0.25%)(e) | 1.07%(b) | 0.88 | % | 0.88 | % | 1.04 | % | 1.10 | % | |||||||
Total expenses | 1.41%(e) | 1.49 | % | 1.69 | % | 1.85 | % | 2.13 | % | 2.35 | % | ||||||
Net expenses | 1.41%(e) | 1.46 | % | 1.66 | % | 1.66 | % | 1.66 | % | 1.66 | % | ||||||
Portfolio turnover | 120 | % | 52 | % | 51 | % | 56 | % | 42 | % | 56 | % | |||||
Net assets, ending (in thousands) | $43,072 | $107,429 | $99,908 | $50,540 | $45,563 | $27,406 | |||||||||||
(a) Net investment income (loss) per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.006 per share and 0.04% of average net assets. | |||||||||||||||||
(c) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(d) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(e) Annualized. | |||||||||||||||||
See notes to financial statements. |
calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED) 17
CALVERT INTERNATIONAL OPPORTUNITIES FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS C SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012 | ||||||||||||
Net asset value, beginning | $14.43 | $14.28 | $16.08 | $15.44 | $12.30 | $10.32 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income (loss) | (0.07) | 0.01(b) | (0.03) | (0.01) | 0.02 | 0.04 | |||||||||||
Net realized and unrealized gain (loss) | 0.96 | 0.61 | (0.76) | 0.66 | 3.14 | 1.95 | |||||||||||
Total from investment operations | 0.89 | 0.62 | (0.79) | 0.65 | 3.16 | 1.99 | |||||||||||
Distributions from: | |||||||||||||||||
Net investment income | (0.01) | — | (0.04) | (0.01) | (0.02) | (0.01) | |||||||||||
Net realized gain | — | (0.47) | (0.97) | — | — | — | |||||||||||
Total distributions | (0.01) | (0.47) | (1.01) | (0.01) | (0.02) | (0.01) | |||||||||||
Total increase (decrease) in net asset value | 0.88 | 0.15 | (1.80) | 0.64 | 3.14 | 1.98 | |||||||||||
Net asset value, ending | $15.31 | $14.43 | $14.28 | $16.08 | $15.44 | $12.30 | |||||||||||
Total return (c) | 6.10 | % | 4.46 | % | (5.09 | %) | 4.20 | % | 25.70 | % | 19.31 | % | |||||
Ratios to average net assets: (d) | |||||||||||||||||
Net investment income (loss) | (0.99%)(e) | 0.04%(b) | (0.18 | %) | (0.08 | %) | 0.17 | % | 0.30 | % | |||||||
Total expenses | 2.60%(e) | 2.67 | % | 2.72 | % | 2.81 | % | 3.27 | % | 3.65 | % | ||||||
Net expenses | 2.34%(e) | 2.44 | % | 2.50 | % | 2.50 | % | 2.50 | % | 2.50 | % | ||||||
Portfolio turnover | 120 | % | 52 | % | 51 | % | 56 | % | 42 | % | 56 | % | |||||
Net assets, ending (in thousands) | $4,989 | $5,037 | $5,030 | $4,605 | $3,282 | $2,363 | |||||||||||
(a) Net investment income (loss) per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.006 per share and 0.04% of average net assets. | |||||||||||||||||
(c) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(d) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(e) Annualized. | |||||||||||||||||
See notes to financial statements. |
18 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT INTERNATIONAL OPPORTUNITIES FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS I SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012 | ||||||||||||
Net asset value, beginning | $14.56 | $14.38 | $16.19 | $15.54 | $12.37 | $10.36 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income | 0.02 | 0.19(b) | 0.19 | 0.20 | 0.25 | 0.21 | |||||||||||
Net realized and unrealized gain (loss) | 0.95 | 0.63 | (0.80) | 0.66 | 3.10 | 1.93 | |||||||||||
Total from investment operations | 0.97 | 0.82 | (0.61) | 0.86 | 3.35 | 2.14 | |||||||||||
Distributions from: | |||||||||||||||||
Net investment income | (0.21) | (0.17) | (0.23) | (0.21) | (0.18) | (0.13) | |||||||||||
Net realized gain | — | (0.47) | (0.97) | — | — | — | |||||||||||
Total distributions | (0.21) | (0.64) | (1.20) | (0.21) | (0.18) | (0.13) | |||||||||||
Total increase (decrease) in net asset value | 0.76 | 0.18 | (1.81) | 0.65 | 3.17 | 2.01 | |||||||||||
Net asset value, ending | $15.32 | $14.56 | $14.38 | $16.19 | $15.54 | $12.37 | |||||||||||
Total return (c) | 6.82 | % | 5.84 | % | (3.86 | %) | 5.58 | % | 27.43 | % | 20.89 | % | |||||
Ratios to average net assets: (d) | |||||||||||||||||
Net investment income | 0.33%(e) | 1.35%(b) | 1.22 | % | 1.24 | % | 1.76 | % | 1.76 | % | |||||||
Total expenses | 1.09%(e) | 1.17 | % | 1.15 | % | 1.18 | % | 1.43 | % | 1.70 | % | ||||||
Net expenses | 1.09%(e) | 1.16 | % | 1.15 | % | 1.18 | % | 1.20 | % | 1.20 | % | ||||||
Portfolio turnover | 120 | % | 52 | % | 51 | % | 56 | % | 42 | % | 56 | % | |||||
Net assets, ending (in thousands) | $88,570 | $69,319 | $40,833 | $32,079 | $24,130 | $8,771 | |||||||||||
(a) Net investment income per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.008 per share and 0.06% of average net assets. | |||||||||||||||||
(c) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(d) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(e) Annualized. | |||||||||||||||||
See notes to financial statements. |
calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED) 19
CALVERT INTERNATIONAL OPPORTUNITIES FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017 (a) (Unaudited) | Year Ended September 30, | ||||||||||||||||
CLASS Y SHARES | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | 2012 | ||||||||||||
Net asset value, beginning | $14.16 | $13.99 | $15.68 | $15.03 | $11.94 | $10.00 | |||||||||||
Income from investment operations: | |||||||||||||||||
Net investment income | —(c) | 0.19(b) | 0.14 | 0.11 | 0.18 | 0.15 | |||||||||||
Net realized and unrealized gain (loss) | 0.94 | 0.60 | (0.77) | 0.70 | 3.03 | 1.90 | |||||||||||
Total from investment operations | 0.94 | 0.79 | (0.63) | 0.81 | 3.21 | 2.05 | |||||||||||
Distributions from: | |||||||||||||||||
Net investment income | (0.19) | (0.15) | (0.09) | (0.16) | (0.12) | (0.11) | |||||||||||
Net realized gain | — | (0.47) | (0.97) | — | — | — | |||||||||||
Total distributions | (0.19) | (0.62) | (1.06) | (0.16) | (0.12) | (0.11) | |||||||||||
Total increase (decrease) in net asset value | 0.75 | 0.17 | (1.69) | 0.65 | 3.09 | 1.94 | |||||||||||
Net asset value, ending | $14.91 | $14.16 | $13.99 | $15.68 | $15.03 | $11.94 | |||||||||||
Total return (d) | 6.77 | % | 5.82 | % | (4.11 | %) | 5.40 | % | 27.06 | % | 20.69 | % | |||||
Ratios to average net assets: (e) | |||||||||||||||||
Net investment income | 0.06%(f) | 1.40%(b) | 0.92 | % | 0.68 | % | 1.31 | % | 1.36 | % | |||||||
Total expenses | 1.19%(f) | 1.21 | % | 1.42 | % | 1.48 | % | 1.90 | % | 2.49 | % | ||||||
Net expenses | 1.19%(f) | 1.18 | % | 1.41 | % | 1.41 | % | 1.41 | % | 1.41 | % | ||||||
Portfolio turnover | 120 | % | 52 | % | 51 | % | 56 | % | 42 | % | 56 | % | |||||
Net assets, ending (in thousands) | $30,537 | $45,589 | $33,299 | $16,536 | $5,138 | $1,638 | |||||||||||
(a) Net investment income per share is calculated using the Average Shares Method. | |||||||||||||||||
(b) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.007 per share and 0.05% of average net assets. | |||||||||||||||||
(c) Amount is less than $0.005 per share. | |||||||||||||||||
(d) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | |||||||||||||||||
(e) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | |||||||||||||||||
(f) Annualized. | |||||||||||||||||
See notes to financial statements. |
20 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
NOTES TO FINANCIAL STATEMENTS
NOTE A — SIGNIFICANT ACCOUNTING POLICIES
General: Calvert World Values Fund, Inc. (the “Corporation”) was organized as a Maryland corporation on February 14, 1992, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Corporation operates four (4) separate series, or mutual funds, each with its own investment objective(s) and strategies, that are accounted for separately. This report contains the financial statements and financial highlights of Calvert International Opportunities Fund (the “Fund”). The Corporation is authorized to issue two billion shares of common stock, $0.01 par value per share, of which 250 million shares have been allocated to the Fund.
The investment objective of the Fund is to seek long-term capital appreciation. The Fund is diversified and invests primarily in common and preferred stocks of non-U.S. small-cap to mid-cap companies.
The Fund offers Class A, Class C, Class I and Class Y shares. Class A shares are generally sold with a maximum front-end sales charge of 4.75%. A contingent deferred sales charge of 0.80% may apply to certain redemptions of Class A shares for accounts for which no sales charge was paid, if redeemed within one year of purchase. Class C shares are sold without a front-end sales charge, and with certain exceptions, are charged a contingent deferred sales charge of 1% on shares redeemed within one year of purchase. Class C shares have higher levels of expenses than Class A shares. Class I shares require a minimum account balance of $1 million. The $1 million minimum initial investment is waived for retirement plans that trade through omnibus accounts and may be waived in certain other instances where it is believed to be in the best interest of the Fund and its shareholders. Class I shares have no front-end or contingent deferred sales charge and have lower levels of expenses than Class A shares. Class Y shares are generally only available to wrap or similar fee-based programs offered by financial intermediaries that have entered into an agreement with the Fund’s principal underwriter to offer Class Y shares to their clients, and retirement plans, foundations, endowments and other consultant-driven business. Class Y shares have no front-end or contingent deferred sales charge and have lower levels of expenses than Class A shares. Among other things, each class has different: (a) dividend rates due to differences in Distribution Plan expenses and other class-specific expenses; (b) exchange privileges; and (c) class-specific voting rights.
The Fund applies the accounting and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946, Financial Services – Investment Companies (ASC 946). Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements.
Security Valuation: Net asset value per share is determined every business day as of the close of the regular session of the New York Stock Exchange (generally 4:00 p.m. Eastern time). The Fund uses independent pricing services approved by the Board of Directors (the “Board”) to value its investments wherever possible. Investments for which market quotations are not available or deemed not reliable are fair valued in good faith under the direction of the Board.
The Board has adopted Valuation Procedures (the “Procedures”) to determine the fair value of securities and financial instruments for which market prices are not readily available or which may not be reliably priced. The Board has delegated the day-to-day responsibility for determining the fair value of securities and financial instruments of the Fund to the Fund's investment adviser (the “Adviser”) and has provided these Procedures to govern the Adviser in its valuation duties.
The Adviser has chartered an internal Valuation Committee to oversee the implementation of these Procedures and to assist it in carrying out the valuation responsibilities that the Board has delegated.
The Valuation Committee meets on a regular basis to review investments which may not have readily available market prices. The Valuation Committee’s fair valuation determinations are subject to review, approval and ratification by the Board at its next regularly scheduled meeting covering the calendar quarter in which the fair valuation was determined.
The Valuation Committee utilizes various methods to measure the fair value of the Fund’s investments. U.S. generally accepted accounting principles (U.S. GAAP) establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are summarized in the three broad levels listed below:
Level 1 - quoted prices in active markets for identical securities
Level 2 - other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
Level 3 - significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED) 21
Changes in valuation techniques may result in transfers in or out of an investment’s assigned level within the hierarchy during the period. Transfers in and/or out of levels are determined based on the fair value of such securities at the end of the period. Valuation techniques used to value the Fund’s investments by major category are as follows:
Common stocks for which market quotations are readily available are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or the last available price and are categorized as Level 2 in the hierarchy. Foreign securities are valued based on quotations from the principal market in which such securities are normally traded. The Fund has retained a third party fair value pricing service to quantitatively analyze the price movement of its holdings on foreign exchanges and to automatically fair value these securities each business day. The third party fair value pricing service takes into account many factors, including, but not limited to, movements in U.S. securities markets and changes in futures contracts and foreign exchange rates that have occurred after the close of the principal foreign market, to determine a fair value as of the close of the New York Stock Exchange. Such securities are categorized as Level 2 in the hierarchy.
For restricted securities and private placements (debt and equity) where observable inputs may be limited, assumptions about market activity and risk are used and such securities are categorized as either Level 2 or Level 3 in the hierarchy depending on the relative significance of valuation inputs.
Short-term securities of sufficient credit quality with remaining maturities of sixty days or less for which quotations are not readily available are valued at amortized cost, which approximates fair value, and are categorized as Level 2 in the hierarchy.
Mutual funds are valued at their closing net asset value each business day and are categorized as Level 1 in the hierarchy.
If a market value cannot be determined for a security using the methodologies described above, or if, in the good faith opinion of the Adviser, the market value does not constitute a readily available market quotation, or if a significant event has occurred that would materially affect the value of the security, the security will be fair valued as determined in good faith by the Valuation Committee.
The Valuation Committee considers a number of factors, including significant unobservable valuation inputs when arriving at fair value. It considers all significant facts that are reasonably available and relevant to the determination of fair value.
The Valuation Committee primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. When more appropriate, the Fund may employ an income-based or cost approach. An income-based valuation approach discounts anticipated future cash flows of the investment to calculate a present amount (discounted). The measurement is based on the value indicated by current market expectations about those future amounts. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. A cost-based approach is based on the amount that currently would be required to replace the service capacity of an asset (current replacement cost). From the seller’s perspective, the price that would be received for the asset is determined based on the cost to a buyer to acquire or construct a substitute asset of comparable utility, adjusted for obsolescence.
The values assigned to fair value investments are based on available information and do not necessarily represent amounts that might ultimately be realized. Further, due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed, and the differences could be material. The Valuation Committee employs various methods for calibrating these valuation approaches including a regular review of key inputs and assumptions, transactional back-testing or disposition analysis and reviews of any related market activity.
22 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
The following table summarizes the market value of the Fund's holdings as of March 31, 2017, based on the inputs used to value them:
VALUATION INPUTS | ||||||||||||
INVESTMENTS IN SECURITIES | LEVEL 1 | LEVEL 2 | LEVEL 3 | TOTAL | ||||||||
Common Stocks | ||||||||||||
Australia | $2,263,372 | $7,803,453 | $— | $10,066,825 | ||||||||
Canada | 2,388,099 | — | — | 2,388,099 | ||||||||
China | 944,636 | — | — | 944,636 | ||||||||
France | 2,637,279 | 7,674,479 | — | 10,311,758 | ||||||||
Ireland | 1,217,138 | 2,074,157 | — | 3,291,295 | ||||||||
Japan | 665,589 | 45,274,631 | — | 45,940,220 | ||||||||
Netherlands | 2,407,323 | 3,507,000 | — | 5,914,323 | ||||||||
Singapore | 525,314 | 1,061,934 | — | 1,587,248 | ||||||||
Switzerland | 2,742,371 | 4,388,176 | — | 7,130,547 | ||||||||
United Kingdom | 5,448,367 | 22,661,290 | — | 28,109,657 | ||||||||
Other Countries* | — | 47,704,231 | — | 47,704,231 | ||||||||
Total Common Stocks | $21,239,488 | $142,149,351** | $— | $163,388,839 | ||||||||
High Social Impact Investments | — | 935,790 | 232,270 | 1,168,060 | ||||||||
Time Deposit | — | 731,190 | — | 731,190 | ||||||||
Short Term Investment of Cash Collateral For Securities Loaned | 465,634 | — | — | 465,634 | ||||||||
TOTAL | $21,705,122 | $143,816,331 | $232,270 | ^ | $165,753,723 | |||||||
* For further breakdown of equity securities by country, please refer to the Schedule of Investments. | ||||||||||||
** Includes certain securities trading primarily outside the U.S. where the value was adjusted as a result of significant market movements following the close of local trading. | ||||||||||||
^ Level 3 securities represent 0.1% of net assets. |
There were no transfers between Level 1 and Level 2 during the six months ended March 31, 2017.
Restricted Securities: The Fund may invest in securities that are subject to legal or contractual restrictions on resale. Generally, these securities may only be sold publicly upon registration under the Securities Act of 1933 or in transactions exempt from such registration. Information regarding restricted securities (excluding Rule 144A securities) is included at the end of the Schedule of Investments.
Security Transactions and Investment Income: Security transactions are accounted for on trade date. Realized gains and losses are recorded on an identified cost basis and may include proceeds from litigation. Dividend income is recorded on the ex-dividend date or, in the case of dividends on certain foreign securities, as soon as the Fund is informed of the ex-dividend date.
Withholding taxes on foreign dividends have been provided for in accordance with the Fund’s understanding of the applicable country’s tax rules and rates. Distributions received that represent a return of capital are recorded as a reduction of cost of investments. Distributions received that represent a capital gain are recorded as a realized gain. Interest income, which includes amortization of premium and accretion of discount on debt securities, is accrued as earned.
Share Class Accounting: Investment income and realized and unrealized gains and losses are allocated to separate classes of shares based upon the relative net assets of each class. Expenses common to the classes are also allocated to each class in proportion to their relative net assets. Expenses arising in connection with a specific class are charged directly to that class.
Foreign Currency Transactions: The Fund’s accounting records are maintained in U.S. dollars. For valuation of assets and liabilities on each date of net asset value determination, foreign denominations are converted into U.S. dollars using the current exchange rate. Security transactions, income, and expenses are translated at the prevailing rate of exchange on the date of the event. Recognized gains or losses on investment transactions attributable to changes in foreign currency exchange rates are recorded for financial statement purposes as net realized gains and losses on investments. That portion of unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed.
Distributions to Shareholders: Distributions to shareholders are recorded by the Fund on ex-dividend date. Dividends from net investment income and distributions from net realized capital gains, if any, are paid at least annually. Distributions are determined
calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED) 23
in accordance with income tax regulations which may differ from U.S. GAAP; accordingly, periodic reclassifications are made within the Fund's capital accounts to reflect income and gains available for distribution under income tax regulations.
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 and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.
Federal Income Taxes: No provision for federal income or excise tax is required since the Fund intends to continue to qualify as a regulated investment company under the Internal Revenue Code and to distribute substantially all of its taxable earnings.
Management has analyzed the Fund's tax positions taken for all open federal income tax years and has concluded that no provision for federal income tax is required in the Fund's financial statements. A Fund's federal tax return is subject to examination by the Internal Revenue Service for a period of three years.
Interim Financial Statements: The interim financial statements relating to March 31, 2017 and for the six months then ended have not been audited by an independent registered public accounting firm, but in the opinion of the Fund’s management, reflect all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the financial statements.
NOTE B — RELATED PARTY TRANSACTIONS
Effective December 31, 2016, Calvert Research and Management (CRM), a subsidiary of Eaton Vance Management (EVM), became the investment adviser to the Fund following a transaction between CRM and certain of its affiliates and Calvert Investment Management, Inc. (CIM) and certain of its affiliates, pursuant to which CRM acquired substantially all of the business assets of CIM after satisfying various closing conditions, including shareholder approval of a new investment advisory agreement between the Fund and CRM (the “Transaction”).
For its services pursuant to the new investment advisory agreement, CRM receives a fee, payable monthly, at the annual rate of 0.75% of the Fund’s average daily net assets. Prior to December 31, 2016, CIM, a direct subsidiary of Calvert Investments, Inc. and an indirect subsidiary of Ameritas Holding Company, provided investment advisory services to the Fund. For its services, CIM received a fee at the same annual rate as the Fund’s investment advisory agreement with CRM. For the six months ended March 31, 2017, the investment advisory fee amounted to $812,115, of which $404,698 was paid to CRM and $407,417 was paid to CIM.
Pursuant to a sub-advisory agreement effective December 31, 2016, CRM pays Eaton Vance Management (International) Limited (EVMI), an indirect, wholly-owned subsidiary of Eaton Vance Corp., a portion of its investment advisory fee for sub-advisory services provided to the Fund.
CRM and EVMI have agreed to reimburse the Fund’s operating expenses to the extent that total annual operating expenses (relating to ordinary operating expenses only and excluding expenses such as brokerage commissions, acquired fund fees and expenses of unaffiliated funds, interest expense, taxes or litigation expenses) exceed 1.66%, 2.26%, 1.20% and 1.41% for Class A, Class C, Class I and Class Y, respectively, of such class’ average daily net assets. The expense reimbursement agreement may be changed or terminated after January 31, 2018. Prior to December 31, 2016, CIM contractually agreed to limit net annual fund operating expenses to 1.66%, 2.41%, 1.20% and 1.41% for Class A, Class C, Class I and Class Y, respectively, of such class’ average daily net assets. For the six months ended March 31, 2017, CRM and EVMI waived or reimbursed in total expenses of $3,929 and CIM waived or reimbursed expenses of $2,353.
The administrative fee is earned by CRM as compensation for administrative services rendered to the Fund. The fee is computed at an annual rate of 0.12% of the Fund’s average daily net assets and is payable monthly. Prior to December 31, 2016, Calvert Investment Administrative Services, Inc. (CIAS), an affiliate of CIM, provided administrative services to the Fund at an annual rate of 0.12% of the Fund's average daily net assets, payable monthly. For the six months ended March 31, 2017, CRM was paid administrative fees of $64,751 and CIAS was paid administrative fees of $65,187.
The Fund adopted a new distribution plan for Class A shares (Class A Plan) and Class C shares (Class C Plan) pursuant to Rule 12b-1 under the 1940 Act, which were approved by the Board of Directors and became effective as of December 31, 2016 or shortly thereafter upon approval by the shareholders of the respective class. Pursuant to the Class A Plan and Class C Plan, the Fund pays a distribution fee of 0.25% and 0.75% per annum for Class A and Class C, respectively, and a service fee of 0.25% per annum for Class C of its average daily net assets attributable to such class for distribution services and facilities provided to the Fund, as well as for personal and/or account maintenance services provided. Pursuant to the Fund’s former distribution plans for Class A shares and Class C shares, the Fund was permitted to pay certain expenses associated with the distribution and servicing of its Class A and Class C shares not to exceed 0.50% for Class A and 1.00% for Class C of the Fund’s average daily net assets with respect to such class. Effective December 31, 2016, the fees are paid to Eaton Vance Distributors, Inc. (EVD), an affiliate of CRM and the Fund’s principal underwriter. Prior to December 31, 2016, the fees were paid to Calvert Investment Distributors,
24 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
Inc. (CID), an affiliate of CIM and the Fund’s former distributor and principal underwriter. Distribution and service fees paid or accrued for the six months ended March 31, 2017 amounted to $124,836 or 0.25% per annum of Class A’s average daily net assets, of which $60,082 was paid to EVD and $64,754 was paid to CID, and $24,146 or 1.00% per annum of Class C’s average daily net assets, of which $12,141 was paid to EVD and $12,005 was paid to CID.
The Fund was informed that EVD and CID received $2,665 and $2,584, respectively, as their portion of the sales charge on sales of Class A shares for the six months ended March 31, 2017. The Fund was also informed that EVD and CID received $6,081 and $76, respectively, of contingent deferred sales charges paid by Fund shareholders for the same period.
Effective December 31, 2016, EVM provides sub-transfer agency services to the Fund pursuant to a Sub-Transfer Agency Support Services Agreement. For its services, EVM receives an annual fee of $8 per shareholder account. Prior to December 31, 2016, Calvert Investment Services, Inc. (CIS), an affiliate of CIM, acted as the shareholder servicing agent for the Fund and received a fee at the same rate as is paid to EVM. For the six months ended March 31, 2017, sub-transfer agency fees paid to EVM were $6,211 and shareholder servicing fees paid to CIS were $6,475. Such fees are included in transfer agency fees and expenses on the Statement of Operations.
Each Director of the Fund who is not an employee of CRM or its affiliates receives a fee of $3,000 for each Board meeting attended in person and $2,000 for each Board meeting attended by phone plus an annual fee of $52,000, and $1,500 for each Committee meeting attended in person and $1,000 for each Committee meeting attended by phone plus an annual Committee fee of $2,500. The Board chair receives an additional $10,000 annual retainer and Committee chairs receive an additional $6,000 annual retainer. Prior to December 31, 2016, each Director of the Fund who was not an employee of CIM or its affiliates received a fee of $3,000 for each Board meeting attended plus an annual fee of $52,000. Committee members received $500 for each Committee meeting attended plus an annual fee of $2,500. Committee chairs received an additional annual retainer ranging from $6,000 to $10,000. Eligible Directors may participate in a Deferred Compensation Plan (the “Plan”). Amounts deferred under the Plan are treated as though equal dollar amounts had been invested in shares of the Fund or other Calvert funds selected by the Directors. The Fund purchases shares of the funds selected equal to the dollar amounts deferred under the Plan, resulting in an asset equal to the deferred compensation liability. Obligations of the Plan are paid solely from the Fund’s assets. Directors’ fees are allocated to each of the Calvert funds served. Salaries and fees of officers and Directors of the Fund who are employees of CRM and, prior to December 31, 2016, of CIM or their affiliates are/were paid by CRM and CIM, respectively. In addition, in connection with the Transaction, an advisory council was established to aid the Board and the Calvert funds’ Adviser in advancing the cause of responsible investing through original scholarship and thought leadership. The advisory council consists of the Adviser’s Chief Executive Officer and four additional members. Each member (other than the Adviser’s Chief Executive Officer) receives annual compensation of $75,000, which will be reimbursed by CIM and Ameritas Holding Company for a period of up to three years.
NOTE C — INVESTMENT ACTIVITY AND TAX INFORMATION
During the six months ended March 31, 2017, the cost of purchases and proceeds from sales of investments, other than short-term securities, were $245,768,158 and $314,179,919, respectively.
At September 30, 2016, the Fund, for federal income tax purposes, had the following capital loss carryforwards which would reduce the Fund’s taxable income arising from future net realized gains on investment transactions, if any, to the extent permitted by the Internal Revenue Code, and thus would reduce the amount of distributions to shareholders, which would otherwise be necessary to relieve the Fund of any liability for federal income or excise tax.
Capital Loss Carryforwards | |||
NO EXPIRATION DATE | |||
Short-term | ($438,086 | ) | |
Long-term | (523,290 | ) |
Under the Regulated Investment Company Modernization Act of 2010, capital losses incurred in taxable years beginning after December 22, 2010 can be carried forward to offset future capital gains for an unlimited period. These losses will retain their character as either long-term or short-term.
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The cost and unrealized appreciation (depreciation) of investments of the Fund at March 31, 2017, as determined on a federal income tax basis, were as follows:
Unrealized appreciation | $11,942,182 | ||
Unrealized (depreciation) | (4,246,418 | ) | |
Net unrealized appreciation (depreciation) | $7,695,764 | ||
Federal income tax cost of investments | $158,057,959 |
NOTE D — SECURITIES LENDING
To generate additional income, the Fund may lend its securities pursuant to a securities lending agency agreement (“Lending Agreement”) with State Street Bank, the securities lending agent. Security loans are subject to termination by the Fund at any time and, therefore, are not considered to be illiquid investments. The Fund requires that the loan be continuously collateralized by either cash or securities as collateral equal at all times to at least 102% of the market value of the domestic securities loaned and 105% of the market value of the international securities loaned (if applicable). Cash collateral is generally invested in State Street Institutional U.S. Government Money Market Fund (the “U.S. Government Fund”) that is managed by an affiliate of the custodian. The U.S. Government Fund is a registered money market fund that invests in a variety of high-quality, U.S. dollar denominated instruments. Any gain or loss in the market price of the loaned securities that might occur and any interest earned or dividends declared during the term of the loan would accrue to the account of the Fund. Income earned on the investment of collateral, net of broker rebates and other expenses incurred by the securities lending agent, is split between the Fund and the securities lending agent on the basis of agreed upon contractual terms.
The risks associated with lending portfolio securities include, but are not limited to, possible delays in receiving additional collateral or in the recovery of the loaned securities, possible loss of rights to the collateral should the borrower fail financially, as well as risk of loss in the value of the collateral or the value of the investments made with the collateral. The securities lending agent shall indemnify the Fund in the case of default of any securities borrower.
The total value of securities on loan was $429,060 as of March 31, 2017.
The following table displays a breakdown of transactions accounted for as secured borrowings, the obligations by class of collateral pledged, and the remaining contractual maturity of those transactions as of March 31, 2017.
Remaining Contractual Maturity of the Agreements as of March 31, 2017 | |||||
Overnight and Continuous | <30 days | Between 30 & 90 days | >90 days | Total | |
Securities Lending Transactions | |||||
Common Stocks | $465,634 | $— | $— | $— | $465,634 |
Amount of recognized liabilities for securities lending transactions | $465,634 |
The carrying amount of the liability for collateral for securities loaned at March 31, 2017 approximated its fair value. If measured at fair value, such liability would have been considered as Level 2 in the fair value hierarchy (see Note A) at March 31, 2017.
NOTE E — LINE OF CREDIT
A financing agreement is in place with the Calvert Funds and State Street Bank and Trust Company (SSB). Under the agreement, which expires on August 8, 2017, SSB provides an unsecured line of credit facility, in the aggregate amount of $50 million ($25 million committed and $25 million uncommitted), accessible by the Calvert Funds for temporary or emergency purposes only. Borrowings bear interest at the higher of the One-Month London Interbank Offered Rate (LIBOR) in effect that day or the overnight Federal Funds Rate plus 1.25% per annum. A commitment fee of 0.25% per annum is incurred on the unused portion of the committed facility. An administrative fee of $30,000 was paid in connection with the uncommitted facility. These fees are allocated to all participating funds. Because the line of credit is not available exclusively to the Fund, it may be unable to borrow some or all of its requested amounts at any particular time. The Fund had no loans outstanding pursuant to this line of credit at March 31, 2017.
For the six months ended March 31, 2017, borrowing information by the Fund under the agreement was as follows:
Average Daily Balance | Weighted Average Interest Rate | Maximum Amount Borrowed | Month of Maximum Amount Borrowed |
$471,184 | 2.03% | $8,572,636 | February 2017 |
26 calvert.com CALVERT INTERNATIONAL OPPORTUNITIES FUND SEMIANNUAL REPORT (UNAUDITED)
NOTE F — AFFILIATED COMPANIES
The Fund invests a portion of its assets designated for high social impact investments in notes issued by the Calvert Social Investment Foundation (the “Foundation”) pursuant to an exemptive order granted by the U.S. Securities and Exchange Commission (the “SEC”). The Fund relies on exemptive relief to invest in the notes because the Fund’s investments in the notes may be considered prohibited transactions between affiliated persons under the 1940 Act. The Foundation may be considered an affiliated person of the Calvert Funds based on the overlap between the Foundation’s Board of Directors and the Funds’ Directors/Trustees and other potential affiliations. The Foundation has licensed use of the Calvert name from the Adviser, and the Adviser’s President and Chief Executive Officer serves on the Foundation Board. The Foundation is not owned or otherwise controlled by the Adviser or its affiliates. Transactions in affiliated companies by the Fund for the six months ended March 31, 2017 were as follows:
Name of Affiliated Company | Principal Amount, beginning of period | Gross Additions | Gross Reductions | Principal Amount, end of period | Value, end of period | Interest Income | Net Realized Gain (Loss) | Capital Gain Distributions Received | Change In Unrealized Appreciation (Depreciation) | |||||||||||
Calvert Social Investment Foundation, Community Investment Notes, 0.50%, 3/18/17 | $1,000,000 | $— | ($1,000,000) | $— | $— | $972 | $— | $— | $16,800 | |||||||||||
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 | — | 1,000,000 | — | 1,000,000 | 935,790 | 4,458 | — | — | (64,210 | ) | ||||||||||
TOTALS | $935,790 | $5,430 | $— | $— | ($47,410 | ) |
NOTE G — RISKS ASSOCIATED WITH FOREIGN INVESTMENTS
Investing in foreign securities involves additional risks relating to political, social, and economic developments abroad. Other risks result from differences between regulations that apply to U.S. and foreign issuers and markets, and the potential for foreign markets to be less liquid and more volatile than U.S. markets. Securities that trade or are denominated in currencies other than the U.S. dollar may be adversely affected by fluctuations in currency exchange rates.
The risks of investing in emerging market securities are greater than those of investing in securities of developed foreign countries. These risks include volatile currency exchange rates, periods of high inflation, increased risk of default, greater social, economic and political uncertainty and instability, less governmental supervision and regulation of securities markets, weaker auditing and financial reporting standards, lack of liquidity in the markets, and the significantly smaller market capitalizations of emerging market issuers.
NOTE H — REGULATORY MATTERS
On October 18, 2016, CIM announced that it had determined that certain fees paid to third-party financial intermediaries were incorrectly allocated for payment by, and paid by, the Calvert Funds. Specifically, for periods prior to January 1, 2015, the Calvert Funds paid fees under certain intermediary agreements that were primarily for distribution-related services or were in excess of the sub-transfer agency expense cap in place during the period and therefore should have been paid by CIM out of CIM’s own assets or by the Calvert Funds under a Rule 12b-1 plan. The matter was self-reported to the SEC in 2016.
On May 2, 2017, in acceptance of a settlement proposal by CIM and CID, the SEC issued an administrative order requiring CIM and CID to pay $21,614,534 to affected shareholders of the Calvert Funds, including the Fund. The administrative order also censured CIM and CID and required them to pay a $1 million penalty to the SEC. CIM is in the process of determining the economic impact of misallocated fees on the affected Calvert Funds, including the Fund, and their shareholders, and developing a plan to reimburse eligible shareholders following that determination.
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SPECIAL MEETING OF SHAREHOLDERS (UNAUDITED)
The Special Meeting of Shareholders of Calvert International Opportunities Fund, a series of Calvert World Values Fund, Inc. (the “Fund”) was held on December 16, 2016, and adjourned to December 23, 2016, December 28, 2016 and January 6, 2017.
Shareholders of the Fund voted on the following proposals:
1. | Approval of a new investment advisory agreement with Calvert Research and Management. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
9,658,201 | 223,481 | 263,964 | 2,689,658 |
2. | Approval of a new investment sub-advisory agreement with Eaton Vance Management (International) Limited. |
Number of Shares* | |||
For | Against | Abstain | Uninstructed** |
9,607,898 | 234,705 | 303,042 | 2,689,659 |
3. | Reaffirmation and approval of the Fund’s ability to invest in notes issued by Calvert Social Investment Foundation. |
Number of Shares* | |||
For | Against | Abstain | Uninstructed** |
9,655,817 | 243,440 | 246,391 | 2,689,657 |
4. | Approval of the Fund’s reliance on a potential future exemptive order that may be granted by the U.S. Securities and Exchange Commission. |
Number of Shares* | |||
For | Against | Abstain | Uninstructed** |
9,631,141 | 238,258 | 276,247 | 2,689,658 |
Shareholders of Class A shares of the Fund voted on the following proposal:
1. | Approval of Master Distribution Plan for Class A shares of the Fund pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended. |
Number of Shares* | |||
For | Against | Abstain | Uninstructed** |
4,252,432 | 47,905 | 365,266 | 1,152,947 |
Shareholders of Class C shares of the Fund voted on the following proposal:
1. | Approval of Master Distribution Plan for Class C shares of the Fund pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
130,739 | 543 | 12,680 | 30,008 |
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Shareholders of Calvert World Values Fund, Inc. voted on the following proposal:
1. | To elect Directors of Calvert World Values Fund, Inc.: |
Number of Shares* | ||
Nominee | For | Withheld |
Richard L. Baird, Jr. | 39,776,422 | 1,439,396 |
Alice Gresham Bullock | 39,831,328 | 1,384,490 |
Cari Dominguez | 39,839,990 | 1,375,828 |
Miles D. Harper III | 39,768,678 | 1,447,140 |
John G. Guffey, Jr. | 39,771,630 | 1,444,188 |
Joy V. Jones | 39,842,813 | 1,373,004 |
Anthony A. Williams | 35,278,280 | 5,937,538 |
John H. Streur | 39,768,579 | 1,447,239 |
* | Excludes fractional shares. |
** | Uninstructed shares (i.e., proxies from brokers or nominees indicating that such persons have not received instructions from the beneficial owner or other person entitled to vote shares on a particular matter with respect to which the brokers or nominees do not have discretionary power) were treated as shares that were present at the meeting for purposes of establishing a quorum, but had the effect of a vote against the proposals. Uninstructed shares are sometimes referred to as broker non-votes. Abstentions were also treated in this manner. |
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BOARD APPROVAL OF INVESTMENT ADVISORY AGREEMENT
Calvert International Opportunities Fund
At a meeting held on October 14, 2016, the Board of Directors of Calvert World Values Fund, Inc. (“CWVF”), and by a separate vote, the Directors who are not “interested persons” of CWVF (the “Independent Directors”), approved a new Investment Advisory Agreement between CWVF and Eaton Vance Investment Advisors (renamed Calvert Research and Management) (“CRM” or the “Adviser”) and a new Investment Sub-Advisory Agreement between the Adviser and Eaton Vance Management (International) Limited (the “Sub-Adviser”), each with respect to the Calvert International Opportunities Fund (the “Fund”). The Board was advised that, subject to shareholder approval and certain other conditions, the new Investment Advisory and Investment Sub-Advisory Agreements would take effect upon the acquisition of substantially all of the business assets of Calvert Investment Management, Inc. (“CIM”) by Eaton Vance Corporation (“Eaton Vance”) (the “Transaction”).
In connection with the proposed Transaction, the Independent Directors, assisted by their independent legal counsel, requested extensive information from CIM and Eaton Vance regarding the proposed Transaction and its potential implications for the Calvert Funds. The Independent Directors also received information from the Sub-Adviser concerning the services to be provided to the Fund. The Independent Directors reviewed and discussed this information and received advice from their independent legal counsel regarding their responsibilities in evaluating the possible Transaction and the new Investment Advisory and Investment Sub-Advisory Agreements.
The Independent Directors met separately on multiple occasions to discuss the Transaction and the proposed change in investment adviser. The interested Directors participated in portions of these meetings to provide the perspective of the Calvert organization, but did not otherwise participate in the deliberations of the Independent Directors regarding the possible change in investment adviser.
In the course of their deliberations regarding the new Investment Advisory Agreement, the Directors considered the following factors, among others: the nature, extent and quality of the services to be provided by CRM and its affiliates, including the personnel who would be providing such services; Eaton Vance’s financial condition; the proposed advisory fees; comparative fee and expense information for the Calvert Funds and for comparable funds managed by Eaton Vance or its affiliates; the anticipated profitability of the Calvert Funds to CRM and its affiliates; the direct and indirect benefits, if any, to be derived by CRM and its affiliates from their relationship with the Calvert Funds; the effect of each Calvert Fund's projected growth and size on each Calvert Fund's performance and expenses; and CRM’s compliance program.
In considering the nature, extent, and quality of the services to be provided to the Fund by CRM under the new Investment Advisory Agreement, the Directors took into account information provided by Eaton Vance or its affiliates relating to its operations and personnel, including, among other information, biographical information on its supervisory and professional staff and descriptions of its organizational and management structure. The Directors considered the new investment strategies to be used in managing certain Calvert Funds and the performance of other funds managed by the investment teams at Eaton Vance or its affiliates that would be managing certain Calvert Funds. The Directors also took into account CRM’s and Eaton Vance’s proposed staffing and overall resources, and noted that the staff of CRM was expected to include certain current employees of CIM as well as certain employees of affiliates of Eaton Vance under a “dual-hat” arrangement. CRM’s administrative capabilities were also considered. The Directors concluded that they were satisfied with the nature, extent and quality of services to be provided to the Fund by CRM under the new Investment Advisory Agreement.
In considering the Fund’s performance, the Board noted that it reviewed on a quarterly basis detailed information about the Fund’s performance results, portfolio composition and investment strategies. The Board also reviewed various comparative data provided to it in connection with its consideration of the new Investment Advisory and Investment Sub-Advisory Agreements, including, comparisons of the Fund’s returns with those of its benchmark and the average of its Lipper category for the one-, three- and five-year periods ended July 31, 2016.
In considering the Fund’s proposed fees and estimated expenses, the Directors considered certain comparative fee and expense data provided by Eaton Vance or its affiliates. The Directors also took into account that there were no increases in the advisory fees being proposed and that for certain Calvert Funds, CRM had proposed a reduction in advisory fees. The Directors further noted that CRM had agreed to maintain current fee waivers/expense reimbursements, if any, for certain Calvert Funds, and increase the fee waivers/expense reimbursements for other Calvert Funds, such as the Fund. Based upon their review the Directors concluded that the proposed advisory fee was reasonable in view of the quality of services to be received by the Fund from CRM.
In reviewing the anticipated profitability of the Fund to CRM and its affiliates, the Directors considered the fact that affiliates of CRM would be providing sub-advisory, shareholder servicing, administrative and distribution services to the Fund for which they would receive compensation. The Board also took into account whether CRM had the financial wherewithal to provide services to the Fund. The Board also considered that CRM would likely derive benefits to its reputation and other indirect benefits from its
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relationship with the Fund. Based upon its review, the Board concluded that CRM’s and its affiliates’ anticipated level of profitability from their relationship with the Fund was reasonable.
The Directors considered the effect of each Calvert Fund’s current size and potential growth on its performance and expenses. The Directors took into account management’s discussion of the Calvert Funds’ proposed advisory and sub-advisory fees. The Directors noted that the advisory fee schedule for certain Calvert Funds, will contain breakpoints that will reduce the respective advisory fee rate on assets above specified levels as the applicable Calvert Fund’s assets increased and considered the necessity of adding breakpoints with respect to the Calvert Funds that did not currently have such breakpoints in their advisory fee schedule. The Directors determined that adding breakpoints at specified levels to the advisory fee schedules of the Calvert Funds that did not currently have breakpoints, such as the Fund, would not be appropriate at this time. The Directors noted that if the Fund’s assets increased over time, the Fund might realize economies of scale if assets increase proportionally more than certain other expenses.
In considering the approval of the new Investment Advisory Agreement, the Directors also considered the following matters:
(i) their belief that the Transaction will benefit the Calvert Funds, including the Fund;
(ii) the continued management of the Fund in a manner materially consistent with the Fund’s existing investment objective and principal investment strategies, which includes continuing to manage the Fund pursuant to responsible investment criteria as described in the prospectus;
(iii) the financial condition and reputation of Eaton Vance and its affiliates, its worldwide presence, experience as a fund sponsor and manager, commitment to maintain a high level of cooperation with, and support to, the Calvert Funds, including the Fund, strong distribution and client service capabilities, and relationships in the asset management industry;
(iv) the intention expressed by representatives of Eaton Vance to retain certain of the existing members of the Calvert management team and other key professionals, including members of the Calvert Sustainability Research Department, in order to better continue principles-based investment research following the closing of the Transaction;
(v) Eaton Vance’s commitment to maintaining competitive compensation arrangements to attract and retain highly qualified personnel; and
(vi) that the current senior management team at Calvert has indicated its strong support of the Transaction.
In approving the new Investment Advisory Agreement with CRM, the Directors did not identify any single factor as controlling, and each Director may have attributed different weight to various factors.
The Directors reached the following conclusions regarding the new Investment Advisory Agreement, among others: (a) CRM has demonstrated that it possesses the capability and resources to perform the duties required of it under the Investment Advisory Agreement and (b) the advisory fees are reasonable in view of the quality of the services to be received by the Fund from CRM. Based on the foregoing considerations, the Directors, including the Independent Directors, approved the new Investment Advisory Agreement, subject to the approval of the Fund’s shareholders.
In connection with the proposed Transaction, the Board determined that it would be in the Fund’s best interests to appoint the Sub-Adviser, an affiliate of CRM, as a new sub-adviser to the Fund effective upon the closing of the Transaction. The Board reviewed and discussed information provided by the Sub-Adviser and received advice from their independent legal counsel regarding their responsibilities in evaluating the proposed Transaction and the new Investment Sub-Advisory Agreement.
In evaluating the new Investment Sub-Advisory Agreement, the Directors considered information provided by Eaton Vance or its affiliates relating to the Sub-Adviser’s operations, personnel, investment philosophy, strategies, and techniques. Among other information, Eaton Vance or its affiliates provided biographical information on portfolio management and other professional staff, performance information for itself, and descriptions of its investment philosophies, strategies and techniques, organizational and management structures, and brokerage policies and practices.
In the course of their deliberations concerning the new Investment Sub-Advisory Agreement, the Directors evaluated, among other factors: the nature, extent and the quality of the services to be provided by the Sub-Adviser; the Sub-Adviser’s management style and long-term performance record; the Fund’s performance record and the Sub-Adviser’s performance in executing its investment strategies; the Sub-Adviser’s current level of staffing and its overall resources; the qualifications and experience of the Sub-Adviser’s personnel; and the Sub-Adviser’s financial condition with respect to its ability to perform the services required under the new Investment Sub-Advisory Agreement. The Directors also considered materials provided by Eaton Vance, including: (1) an explanation of the basis for recommending that the Sub-Adviser serve as sub-adviser to the Fund; (2) a description of the investment professionals who would manage the Fund; (3) a description of the investment strategy and investment process to be used in managing the Fund; and (4) performance information for comparable funds. Based upon their review, the Directors
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concluded that they were satisfied with the nature, extent and quality of services proposed to be provided to the Fund by the Sub-Adviser under the new Investment Sub-Advisory Agreement.
In considering the cost of services to be provided by the Sub-Adviser and the profitability to the Sub-Adviser of its relationship with the Fund, the Directors noted that CRM would pay the sub-advisory fees to the Sub-Adviser out of its advisory fee. Based upon their review, the Directors determined that the proposed sub-advisory fee was reasonable in view of the quality of services to be received by the Fund from the Sub-Adviser. Because CRM would pay the Sub-Adviser’s sub-advisory fees, the cost of services provided by the Sub-Adviser and the profitability to the Sub-Adviser of its relationship with the Fund were not material factors in the Board’s deliberations. For similar reasons, the Board did not consider the potential economies of scale in the Sub-Adviser’s management of the Fund to be a material factor in its consideration.
In approving the new Investment Sub-Advisory Agreement, the Directors did not identify any single factor as controlling, and each Director may have attributed different weight to various factors.
The Directors reached the following conclusions regarding the new Investment Sub-Advisory Agreement, among others: (a) the Sub-Adviser is qualified to manage the Fund’s assets in accordance with the Fund’s investment objectives and policies; (b) the Sub-Adviser is likely to execute its investment strategies consistently over time; and (c) the proposed sub-advisory fees are reasonable in view of the quality of services to be received by the Fund from the Sub-Adviser. Based upon the foregoing considerations, the Directors, including the Independent Directors, approved the new Investment Sub-Advisory Agreement, subject to approval of the Fund's shareholders.
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OFFICERS AND DIRECTORS
Officers of Calvert International Opportunities Fund
Hope Brown
Chief Compliance Officer
Maureen A. Gemma(1)
Secretary and Vice President
James F. Kirchner(1)
Treasurer
Directors of Calvert International Opportunities Fund
Alice Gresham Bullock(2)(4)
Chairperson
Richard L. Baird, Jr.(4)
Cari Dominguez(2)(4)
John G. Guffey, Jr.(4)
Miles D. Harper, III(4)
Joy V. Jones(4)
John H. Streur(3)
Anthony A. Williams(2)(4)
(1)Ms. Gemma and Mr. Kirchner began serving as Officers effective December 31, 2016.
(2)Mmes. Bullock and Dominguez and Mr. Williams began serving as Directors effective December 23, 2016.
(3)Interested Director and President
(4)Independent Director
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IMPORTANT NOTICES
Privacy. The Calvert organization is committed to ensuring your financial privacy. Each of the financial institutions identified below has in effect the following policy (“Privacy Policy”) with respect to nonpublic personal information about its customers:
• | Only such information received from you, through application forms or otherwise, and information about your Calvert fund transactions will be collected. This may include information such as name, address, social security number, tax status, account balances and transactions. |
• | None of such information about you (or former customers) will be disclosed to anyone, except as permitted by law (which includes disclosure to employees necessary to service your account). In the normal course of servicing a customer’s account, the Calvert organization may share information with unaffiliated third parties that perform various required services such as transfer agents, custodians and broker-dealers. |
• | Policies and procedures (including physical, electronic and procedural safeguards) are in place that are designed to protect the confidentiality of such information. |
• | We reserve the right to change our Privacy Policy at any time upon proper notification to you. Customers may want to review our Privacy Policy periodically for changes by accessing the link on our homepage: www.Calvert.com. |
Our pledge of privacy applies to the following entities within the Calvert organization: the Calvert Family of funds and Calvert Research and Management. In addition, our Privacy Policy applies only to those Calvert customers who are individuals and who have a direct relationship with us. If a customer’s account (i.e., fund shares) is held in the name of a third-party financial adviser/broker-dealer, it is likely that only such advisor’s privacy policies apply to the customer. This notice supersedes all previously issued privacy disclosures. For more information about Calvert’s Privacy Policy, please call 1-800-368-2745.
Delivery of Shareholder Documents. The Securities and Exchange Commission (SEC) permits funds to deliver only one copy of shareholder documents, including prospectuses, proxy statements and shareholder reports, to fund investors with multiple accounts at the same residential or post office box address. This practice is often called “householding” and it helps eliminate duplicate mailings to shareholders. Calvert funds, or your financial advisor, may household the mailing of your documents indefinitely unless you instruct Calvert funds, or your financial advisor, otherwise. If you would prefer that your Calvert fund documents not be householded, please contact Calvert funds at 1-800-368-2745, or contact your financial advisor. Your instructions that householding not apply to delivery of your Calvert fund documents will typically be effective within 30 days of receipt by Calvert funds or your financial advisor. Separate statements will be generated for each separate account and will be householded as described above.
Portfolio Holdings. Each Calvert fund will file a schedule of portfolio holdings on Form N-Q with the SEC for the first and third quarters of each fiscal year. The Form N-Q will be available on the Calvert funds’ website at www.calvert.com, by calling Calvert funds at 1-800-368-2745 or in the EDGAR database on the SEC’s website at www.sec.gov. Form N-Q may also be reviewed and copied at the SEC’s public reference room in Washington, D.C. (call 1-800-732-0330 for information on the operation of the public reference room).
Proxy Voting. The Proxy Voting Guidelines that each Calvert fund uses to determine how to vote proxies relating to portfolio securities is provided as an Appendix to the fund’s Statement of Additional Information. The Statement of Additional Information can be obtained free of charge by calling the Calvert funds at 1-800-368-2745, by visiting the Calvert funds’ website at www.calvert.com or visiting the SEC’s website at www.sec.gov. Information regarding how a Calvert fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available by calling Calvert funds, by visiting the Calvert funds’ website at www.calvert.com or by visiting the SEC’s website at www.sec.gov.
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CALVERT INTERNATIONAL OPPORTUNITIES FUND | CALVERT’S FAMILY OF FUNDS | |||
Service for Existing Account Shareholders: 800-368-2745 Brokers: 800-368-2746 Regular Mail Calvert Funds c/o BFDS P.O. Box 219544 Kansas City, MO 64121-9544 Overnight Mail Calvert Funds c/o BFDS 330 West 9th Street Kansas City, MO 64105-1514 Web Site calvert.com Principal Underwriter* Eaton Vance Distributors, Inc. Two International Place Boston, MA 02110 | Municipal Funds Tax-Free Responsible Impact Bond Fund Taxable Bond Funds Bond Portfolio Income Fund Short Duration Income Fund Long-Term Income Fund Ultra-Short Income Fund High Yield Bond Fund Green Bond Fund Unconstrained Bond Fund Balanced and Asset Allocation Funds Balanced Portfolio Conservative Allocation Fund Moderate Allocation Fund Aggressive Allocation Fund | Equity Funds Equity Portfolio U.S. Large Cap Core Responsible Index Fund U.S. Large Cap Value Responsible Index Fund U.S. Large Cap Growth Responsible Index Fund U.S. Mid Cap Core Responsible Index Fund Developed Markets Ex-U.S. Responsible Index Fund Capital Accumulation Fund International Equity Fund Small Cap Fund Global Energy Solutions Fund Global Water Fund International Opportunities Fund Emerging Markets Equity Fund |
* FINRA BrokerCheck. Investors may check the background of their Investment Professional by contacting the Financial Industry Regulatory Authority (FINRA). FINRA BrokerCheck is a free tool to help investors check the professional background of current and former FINRA-registered securities firms and brokers. FINRA BrokerCheck is available by calling 1-800-289-9999 and at www.FINRA.org. The FINRA BrokerCheck brochure describing this program is available to investors at www.FINRA.org.
Fund shares are not insured by the FDIC and are not deposits or other obligations of, or guaranteed by, any depository institution. Shares are subject to investment risks, including possible loss of principal invested. This report is intended to provide fund information to shareholders. It is not authorized for distribution to prospective investors unless preceded or accompanied by a prospectus. Note: The information on our website is not incorporated by reference into this report; our website address is included as an inactive textual reference only. Investors should carefully consider the investment objectives, risks, charges and expenses of the Calvert funds. This and other important information is contained in the fund’s summary prospectus and prospectus, which can be obtained from your financial professional and should be read carefully before investing. You may also call Calvert funds at 800-368-2745. Printed on recycled paper. | |
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Calvert Emerging Markets Equity Fund | ![]() | |
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Semiannual Report March 31, 2017 E-Delivery Sign-Up — Details Inside | ![]() |
Choose Planet-friendly E-delivery! Sign up now for on-line statements, prospectuses, and fund reports. In less than five minutes you can help reduce paper mail and lower fund costs. Just go to calvert.com. If you already have an online account at Calvert, click on Login, to access your Account, and select the documents you would like to receive via e-mail. If you’re new to online account access, click on Login, then Register to create your user name and password. Once you’re in, click on the E-delivery sign-up on the Account Portfolio page and follow the quick, easy steps. Note: if your shares are not held directly at Calvert but through a brokerage firm, you must contact your broker for electronic delivery options available through their firm. |
PERFORMANCE AND FUND PROFILE
Performance1,2 | ||||||||||||||||
Portfolio Managers Gary Greenberg, CFA and Elena Tedesco, CFA, each of Hermes Investment Management Limited | ||||||||||||||||
% Average Annual Total Returns | Class Inception Date | Performance Inception Date | Six Months | One Year | Five Years | Since Inception | ||||||||||
Class A at NAV | 10/29/2012 | 10/29/2012 | 5.60 | % | 15.32 | % | — | 5.55 | % | |||||||
Class A with 4.75% Maximum Sales Charge | — | — | 0.55 | 9.85 | — | 4.39 | ||||||||||
Class C at NAV | 10/29/2012 | 10/29/2012 | 5.16 | 14.50 | — | 4.62 | ||||||||||
Class C with 1% Maximum Sales Charge | — | — | 4.16 | 13.50 | — | 4.62 | ||||||||||
Class I at NAV | 10/29/2012 | 10/29/2012 | 5.80 | 15.82 | — | 5.94 | ||||||||||
Class Y at NAV | 10/29/2012 | 10/29/2012 | 5.71 | 15.64 | — | 5.83 | ||||||||||
MSCI Emerging Markets Index | — | — | 6.80 | % | 17.21 | % | 0.80 | % | 1.59 | % | ||||||
Ticker Symbol | Class A | Class C | Class I | Class Y | ||||||||||||
CVMAX | CVMCX | CVMIX | CVMYX | |||||||||||||
% Total Annual Operating Expense Ratios3 | Class A | Class C | Class I | Class Y | ||||||||||||
Gross | 1.81 | % | 4.31 | % | 1.35 | % | 1.48 | % | ||||||||
Net | 1.27 | 2.02 | 0.92 | 1.02 |
Fund Profile | |||||||
SECTOR ALLOCATION (% of total investments)4 | TEN LARGEST STOCK HOLDINGS (% of net assets) | ||||||
Information Technology | 29.9 | % | Tencent Holdings Ltd. | 6.3 | % | ||
Consumer Discretionary | 22.4 | % | Taiwan Semiconductor Manufacturing Co. Ltd. (ADR) | 5.4 | % | ||
Financials | 21.6 | % | Alibaba Group Holding Ltd. (ADR) | 4.3 | % | ||
Health Care | 7.7 | % | Techtronic Industries Co. Ltd. | 3.7 | % | ||
Consumer Staples | 7.1 | % | HDFC Bank Ltd. (ADR) | 3.3 | % | ||
Utilities | 5.0 | % | Samsonite International SA | 3.2 | % | ||
Materials | 1.8 | % | KB Financial Group, Inc. | 2.7 | % | ||
Energy | 1.8 | % | AIA Group Ltd. | 2.6 | % | ||
Industrials | 1.4 | % | Power Grid Corp. of India Ltd. | 2.6 | % | ||
High Social Impact Investments | 1.3 | % | Bank Rakyat Indonesia Persero Tbk PT | 2.5 | % | ||
Total | 100.0 | % | Total | 36.6 | % |
See Endnotes and Additional Disclosures in this report.
Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value (NAV) or offering price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance less than or equal to one year is cumulative. Performance is for the stated time period only; due to market volatility, the Fund's current performance may be lower or higher than quoted. Returns are before taxes unless otherwise noted. For performance as of the most recent month-end, please refer to calvert.com.
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Endnotes and Additional Disclosures | ||
1 MSCI Emerging Markets Index is an unmanaged index of emerging markets common stocks. MSCI indexes are net of foreign withholding taxes. Source: MSCI. MSCI data may not be reproduced or used for any other purpose. MSCI provides no warranties, has not prepared or approved this report, and has no liability hereunder. Unless otherwise stated, index returns do not reflect the effect of any applicable sales charges, commissions, expenses, taxes or leverage, as applicable. It is not possible to invest directly in an index.2 Total Returns at NAV do not include applicable sales charges. If sales charges were deducted, the returns would be lower. Total Returns shown with maximum sales charge reflect the stated maximum sales charge. Unless otherwise stated, performance does not reflect the deduction of taxes on Fund distributions or redemptions of Fund shares.3 Source: Fund prospectus. Net expense ratios reflect a contractual expense reimbursement that continues through 1/31/18. Without the reimbursement, performance would have been lower. The expense ratios for the current reporting period can be found in the Financial Highlights section of this report.4 Does not include Short Term Investment of Cash Collateral for Securities Loaned.Fund profile subject to change due to active management. |
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UNDERSTANDING YOUR FUND'S EXPENSES
As an investor, you incur two types of costs. There are transaction costs, which generally include sales charges (loads) on purchases and may include redemption fees. There are also ongoing costs, which generally include management fees, distribution and/or service fees, and other fund expenses. The following information is intended to help you understand your ongoing costs (in dollars) of investing in this mutual fund and to help you compare these costs with the ongoing costs of investing in other mutual funds.
To illustrate these ongoing costs, we have provided examples and calculated the expenses paid by the Fund's investors during the period. The actual and hypothetical information presented in the examples is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (October 1, 2016 to March 31, 2017).
Actual Expenses
The first line for each class of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 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.
Hypothetical Example for Comparison Purposes
The second line for each class of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and 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 the Fund and other funds. To do so, compare the 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the 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 sales charges (loads) or redemption fees, if applicable. 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.
ANNUALIZED EXPENSE RATIO | BEGINNING ACCOUNT VALUE 10/1/16 | ENDING ACCOUNT VALUE 3/31/17 | EXPENSES PAID DURING PERIOD* 10/1/16 - 3/31/17 | |
Class A | ||||
Actual | 1.27% | $1,000.00 | $1,056.00 | $6.51 |
Hypothetical (5% return per year before expenses) | 1.27% | $1,000.00 | $1,018.60 | $6.39 |
Class C | ||||
Actual | 2.02% | $1,000.00 | $1,051.60 | $10.33 |
Hypothetical (5% return per year before expenses) | 2.02% | $1,000.00 | $1,014.86 | $10.15 |
Class I | ||||
Actual | 0.92% | $1,000.00 | $1,058.00 | $4.72 |
Hypothetical (5% return per year before expenses) | 0.92% | $1,000.00 | $1,020.34 | $4.63 |
Class Y | ||||
Actual | 1.02% | $1,000.00 | $1,057.10 | $5.23 |
Hypothetical (5% return per year before expenses) | 1.02% | $1,000.00 | $1,019.85 | $5.14 |
* Expenses paid during the period are equal to the annualized expense ratio for each class as indicated above, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period). |
4 calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT EMERGING MARKETS EQUITY FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2017 (Unaudited)
SHARES | VALUE ($) | |
COMMON STOCKS - 91.6% | ||
Argentina - 1.5% | ||
Pampa Energia SA (ADR) * | 43,494 | 2,358,245 |
Brazil - 8.1% | ||
BB Seguridade Participacoes SA | 278,500 | 2,597,649 |
Itau Unibanco Holding SA, PFC Shares | 173,134 | 2,096,013 |
Klabin SA | 539,682 | 2,611,698 |
Lojas Renner SA | 267,700 | 2,377,199 |
Ultrapar Participacoes SA | 113,400 | 2,594,298 |
12,276,857 | ||
Chile - 1.4% | ||
S.A.C.I. Falabella | 249,907 | 2,085,983 |
China - 15.9% | ||
Alibaba Group Holding Ltd. (ADR) * | 60,891 | 6,565,876 |
China Biologic Products, Inc. * | 31,930 | 3,197,151 |
China Mengniu Dairy Company Ltd. | 1,283,000 | 2,660,446 |
Shenzhen International Holdings Ltd. | 1,297,404 | 2,128,732 |
Tencent Holdings Ltd. | 333,800 | 9,616,612 |
24,168,817 | ||
Hong Kong - 9.5% | ||
AIA Group Ltd. | 631,000 | 3,982,844 |
Samsonite International SA | 1,348,475 | 4,903,678 |
Techtronic Industries Co. Ltd. | 1,372,000 | 5,554,238 |
14,440,760 | ||
Hungary - 1.9% | ||
Richter Gedeon Nyrt | 126,595 | 2,875,193 |
India - 13.6% | ||
Bharat Forge Ltd. | 152,614 | 2,455,221 |
HCL Technologies Ltd. | 158,720 | 2,141,083 |
HDFC Bank Ltd. (ADR) | 66,357 | 4,991,374 |
Hero MotoCorp. Ltd. | 38,774 | 1,923,821 |
Motherson Sumi Systems Ltd. * | 545,344 | 3,124,107 |
Power Grid Corp. of India Ltd. | 1,284,342 | 3,901,896 |
Tech Mahindra Ltd. | 302,363 | 2,130,708 |
20,668,210 | ||
Indonesia - 2.5% | ||
Bank Rakyat Indonesia Persero Tbk PT | 3,979,100 | 3,874,523 |
Mexico - 3.3% | ||
Grupo Financiero Banorte SAB de CV | 358,589 | 2,063,554 |
calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 5
SHARES | VALUE ($) | |
COMMON STOCKS - CONT’D | ||
Wal-Mart de Mexico SAB de CV | 1,305,887 | 3,013,223 |
5,076,777 | ||
Peru - 1.7% | ||
Credicorp Ltd. | 15,541 | 2,537,845 |
Russia - 4.6% | ||
Magnit PJSC | 16,602 | 2,737,406 |
Mail.Ru Group Ltd. (GDR) * | 84,058 | 1,857,682 |
Sberbank of Russia PJSC (ADR) | 210,084 | 2,428,175 |
7,023,263 | ||
South Africa - 5.3% | ||
Foschini Group Ltd. (The) | 180,599 | 2,078,433 |
Life Healthcare Group Holdings Ltd. (a) | 967,020 | 2,084,486 |
Naspers Ltd., Class N | 10,381 | 1,788,774 |
Shoprite Holdings Ltd. (a) | 145,316 | 2,101,676 |
8,053,369 | ||
South Korea - 4.8% | ||
KB Financial Group, Inc. | 93,389 | 4,092,909 |
Samsung Fire & Marine Insurance Co. Ltd. | 13,280 | 3,183,939 |
7,276,848 | ||
Taiwan - 14.8% | ||
Advantech Co. Ltd. | 337,000 | 2,821,119 |
Chipbond Technology Corp. | 1,413,000 | 2,259,518 |
Hon Hai Precision Industry Co. Ltd. | 967,400 | 2,901,317 |
Land Mark Optoelectronics Corp. | 260,900 | 2,539,536 |
Taiwan Semiconductor Manufacturing Co. Ltd. (ADR) | 247,866 | 8,139,919 |
Tong Yang Industry Co. Ltd. | 1,068,448 | 1,855,847 |
Tung Thih Electronic Co. Ltd. | 234,000 | 2,016,747 |
22,534,003 | ||
Turkey - 0.7% | ||
Aygaz AS | 265,935 | 1,076,534 |
United Kingdom - 2.0% | ||
NMC Health plc (a) | 137,513 | 3,048,175 |
Total Common Stocks (Cost $121,003,698) | 139,375,402 | |
RIGHTS - 0.1% | ||
Life Healthcare Group Holdings Ltd. * | 330,881 | 110,982 |
Total Rights (Cost $0) | 110,982 | |
6 calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
SHARES | VALUE ($) | |
PARTICIPATORY NOTES - 3.8% | ||
China - 3.8% | ||
Gree Electric Appliances, Inc., (Merrill Lynch International & Co.), 8/31/18 * | 116,652 | 536,926 |
Gree Electric Appliances, Inc., (Morgan Stanley Asia Products Ltd.), 12/14/18 * | 309,867 | 1,426,256 |
Gree Electric Appliances, Inc., (Morgan Stanley Asia Products Ltd.), 2/16/18 * | 181,097 | 833,553 |
Hangzhou Hikvision Digital Technology Co. Ltd., (Merrill Lynch International & Co.), 4/9/19 * | 435,676 | 2,017,964 |
Hangzhou Hikvision Digital Technology Co. Ltd., (Morgan Stanley Asia Products Ltd.), 1/18/19 * | 227,912 | 1,055,643 |
5,870,342 | ||
Total Participatory Notes (Cost $4,152,445) | 5,870,342 | |
PRINCIPAL AMOUNT ($) | VALUE ($) | |
HIGH SOCIAL IMPACT INVESTMENTS - 1.3% | ||
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 (b)(c) | 2,000,000 | 1,871,580 |
ImpactAssets Inc., Global Sustainable Agriculture Notes, 0.00%, 11/3/20 (b)(d)(e) | 43,000 | 38,270 |
ImpactAssets Inc., Microfinance Plus Notes, 0.00%, 11/3/20 (b)(d)(e) | 56,000 | 52,640 |
Total High Social Impact Investments (Cost $2,099,000) | 1,962,490 | |
SHARES | VALUE ($) | |
SHORT TERM INVESTMENT OF CASH COLLATERAL FOR SECURITIES LOANED - 2.6% | ||
State Street Institutional U.S. Government Money Market Fund - Premier Class, 0.62% | 3,900,485 | 3,900,485 |
Total Short Term Investment of Cash Collateral For Securities Loaned (Cost $3,900,485) | 3,900,485 | |
TOTAL INVESTMENTS (Cost $131,155,628) - 99.4% | 151,219,701 | |
Other assets and liabilities, net - 0.6% | 839,054 | |
NET ASSETS - 100.0% | 152,058,755 |
At March 31, 2017, the concentration of the Fund’s investments in the various sectors, determined as a percentage of total investments, was as follows: | ||
ECONOMIC SECTORS | % OF TOTAL INVESTMENTS* | |
Information Technology | 29.9 | % |
Consumer Discretionary | 22.4 | % |
Financials | 21.6 | % |
Health Care | 7.7 | % |
Consumer Staples | 7.1 | % |
Utilities | 5.0 | % |
Materials | 1.8 | % |
Energy | 1.8 | % |
Industrials | 1.4 | % |
High Social Impact Investments | 1.3 | % |
Total | 100.0 | % |
* Does not include Short Term Investment of Cash Collateral for Securities Loaned. |
calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 7
NOTES TO SCHEDULE OF INVESTMENTS |
* Non-income producing security. |
(a) Security, or portion of security, is on loan. Total value of securities on loan is $3,438,805 as of March 31, 2017. |
(b) Restricted Security. Total market value of restricted securities amounts to $1,962,490, which represents 1.3% of the net assets of the Fund as of March 31, 2017. |
(c) Affiliated company (see Note G). |
(d) For fair value measurement disclosure purposes, security is categorized as Level 3 (see Note A). |
(e) Notes carry an interest rate that varies by period and is contingent on the performance of the underlying portfolio of loans to borrowers. The coupon rate shown represents the rate in effect at March 31, 2017. |
Abbreviations: | |
ADR: | American Depositary Receipts |
GDR: | Global Depositary Receipts |
PFC Shares: | Preference Shares |
RESTRICTED SECURITIES | ACQUISITION DATES | COST ($) |
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 | 12/15/16 | 2,000,000 |
ImpactAssets Inc., Global Sustainable Agriculture Notes, 0.00%, 11/3/20 | 11/13/15 | 43,000 |
ImpactAssets Inc., Microfinance Plus Notes, 0.00%, 11/3/20 | 11/13/15 | 56,000 |
See notes to financial statements. |
8 calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT EMERGING MARKETS EQUITY FUND
STATEMENT OF ASSETS AND LIABILITIES
MARCH 31, 2017 (Unaudited)
ASSETS | |||
Investments in unaffiliated securities, at value (Cost $129,155,628) - see accompanying schedule | $149,348,121 | ||
Investments in affiliated securities, at value (Cost $2,000,000) - see accompanying schedule | 1,871,580 | ||
Cash | 968,833 | ||
Foreign currency, at value (Cost $2,234,774) | 2,301,109 | ||
Receivable for securities sold | 1,765,304 | ||
Receivable for Fund shares sold | 728,313 | ||
Dividends and interest receivable | 268,341 | ||
Interest receivable affiliated | 8,917 | ||
Securities lending income receivable | 323 | ||
Directors' deferred compensation plan | 49,121 | ||
Tax reclaims receivable | 2,975 | ||
Receivable from affiliate | 57,552 | ||
Total assets | 157,370,489 | ||
LIABILITIES | |||
Payable for securities purchased | 929,970 | ||
Collateral for securities loaned | 3,900,485 | ||
Payable for Fund shares redeemed | 155,237 | ||
Payable for foreign capital gains taxes | 104,903 | ||
Payable to affiliates: | |||
Investment advisory fee | 110,295 | ||
Administrative fees | 13,730 | ||
Distribution Plan expenses | 7,645 | ||
Sub-transfer agent fee | 644 | ||
Directors' fees and expenses | 3,836 | ||
Directors' deferred compensation plan | 49,121 | ||
Accrued expenses and other liabilities | 35,868 | ||
Total liabilities | 5,311,734 | ||
NET ASSETS | $152,058,755 | ||
NET ASSETS CONSIST OF: | |||
Paid-in capital applicable to common stock | |||
(250,000,000 shares of $0.01 par value authorized) | $137,419,439 | ||
Accumulated undistributed net investment income | 76,430 | ||
Accumulated net realized gain (loss) | (5,472,818) | ||
Net unrealized appreciation (depreciation) | 20,035,704 | ||
NET ASSETS | $152,058,755 | ||
calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 9
NET ASSET VALUE PER SHARE | |||
Class A (based on net assets of $27,787,441 and 2,044,512 shares outstanding) | $13.59 | ||
Class C (based on net assets of $1,433,090 and 106,945 shares outstanding) | $13.40 | ||
Class I (based on net assets of $79,336,994 and 5,793,167 shares outstanding) | $13.69 | ||
Class Y (based on net assets of $43,501,230 and 3,149,161 shares outstanding) | $13.81 | ||
OFFERING PRICE PER SHARE* | |||
Class A (100/95.25 of net asset value per share) | $14.27 | ||
* On sales of $50,000 or more, the offering price of Class A shares is reduced. | |||
See notes to financial statements. |
10 calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT EMERGING MARKETS EQUITY FUND
STATEMENT OF OPERATIONS
SIX MONTHS ENDED MARCH 31, 2017 (Unaudited)
NET INVESTMENT INCOME | |||
Investment Income: | |||
Dividend income (net of foreign taxes withheld of $88,440) | $747,164 | ||
Interest income - affiliated | 13,028 | ||
Securities lending income | 1,687 | ||
Interest income | 1,592 | ||
Other income | 89 | ||
Total investment income | 763,560 | ||
Expenses: | |||
Investment advisory fee | 584,493 | ||
Administrative fees | 76,867 | ||
Transfer agency fees and expenses: | |||
Class A | 29,876 | ||
Class C | 2,610 | ||
Class I | 2,540 | ||
Class Y | 12,511 | ||
Distribution Plan expenses: | |||
Class A | 39,003 | ||
Class C | 5,558 | ||
Directors' fees and expenses | 10,168 | ||
Accounting fees | 18,300 | ||
Custodian fees | 108,495 | ||
Professional fees | 20,048 | ||
Registration fees: | |||
Class A | 9,852 | ||
Class C | 8,533 | ||
Class I | 9,809 | ||
Class Y | 9,694 | ||
Reports to shareholders | 5,199 | ||
Miscellaneous | 10,090 | ||
Total expenses | 963,646 | ||
Reimbursement from Adviser: | |||
Class A | (82,986) | ||
Class C | (12,707) | ||
Class I | (132,043) | ||
Class Y | (64,329) | ||
Administrative fees waived | (6,603) | ||
Net expenses | 664,978 | ||
NET INVESTMENT INCOME (LOSS) | 98,582 | ||
calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 11
REALIZED AND UNREALIZED GAIN (LOSS) | |||
Net realized gain (loss) on: | |||
Investments | 275,253 | ||
Foreign currency transactions | (176,419) | ||
98,834 | |||
Net change in unrealized appreciation (depreciation) on: | |||
Investments in unaffiliated securities (including net increase in payable for foreign capital gains taxes of $91,641) | 8,491,778 | ||
Investments in affiliated securities | (92,840) | ||
Foreign currency | 65,698 | ||
8,464,636 | |||
NET REALIZED AND UNREALIZED GAIN (LOSS) | 8,563,470 | ||
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $8,662,052 | ||
See notes to financial statements. |
12 calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT EMERGING MARKETS EQUITY FUND
STATEMENTS OF CHANGES IN NET ASSETS
INCREASE (DECREASE) IN NET ASSETS | SIX MONTHS ENDED MARCH 31, 2017 (Unaudited) | YEAR ENDED SEPTEMBER 30, 2016 | |||||
Operations: | |||||||
Net investment income (loss) | $98,582 | $887,140 | |||||
Net realized gain (loss) | 98,834 | (2,908,514) | |||||
Net change in unrealized appreciation (depreciation) | 8,464,636 | 19,998,404 | |||||
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | 8,662,052 | 17,977,030 | |||||
Distributions to shareholders from: | |||||||
Net investment income: | |||||||
Class A shares | (160,548) | (201,769) | |||||
Class C shares | (1,582) | (739) | |||||
Class I shares | (514,051) | (492,370) | |||||
Class Y shares | (212,318) | (124,328) | |||||
Total distributions | (888,499) | (819,206) | |||||
Capital share transactions: | |||||||
Shares sold: | |||||||
Class A shares | 7,945,106 | 25,335,469 | |||||
Class C shares | 516,114 | 482,880 | |||||
Class I shares | 20,948,040 | 15,361,751 | |||||
Class Y shares | 22,068,736 | 23,886,469 | |||||
Reinvestment of distributions: | |||||||
Class A shares | 148,081 | 173,845 | |||||
Class C shares | 1,420 | 668 | |||||
Class I shares | 508,083 | 491,547 | |||||
Class Y shares | 194,485 | 116,687 | |||||
Shares redeemed: | |||||||
Class A shares | (21,283,325) | (14,634,570) | |||||
Class C shares | (160,209) | (195,772) | |||||
Class I shares | (4,480,852) | (5,100,991) | |||||
Class Y shares | (7,355,674) | (7,965,677) | |||||
Total capital share transactions | 19,050,005 | 37,952,306 | |||||
TOTAL INCREASE (DECREASE) IN NET ASSETS | 26,823,558 | 55,110,130 | |||||
NET ASSETS | |||||||
Beginning of period | 125,235,197 | 70,125,067 | |||||
End of period (including accumulated undistributed net investment income of $76,430 and $866,347, respectively) | $152,058,755 | $125,235,197 | |||||
calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 13
CALVERT EMERGING MARKETS EQUITY FUND
STATEMENTS OF CHANGES IN NET ASSETS - CONT’D
CAPITAL SHARE ACTIVITY | SIX MONTHS ENDED MARCH 31, 2017 (Unaudited) | YEAR ENDED SEPTEMBER 30, 2016 | |
Shares sold: | |||
Class A shares | 623,466 | 2,131,863 | |
Class C shares | 41,587 | 42,163 | |
Class I shares | 1,638,022 | 1,296,392 | |
Class Y shares | 1,673,190 | 2,051,842 | |
Reinvestment of distributions: | |||
Class A shares | 12,454 | 15,091 | |
Class C shares | 121 | 59 | |
Class I shares | 42,446 | 42,411 | |
Class Y shares | 16,100 | 9,973 | |
Shares redeemed: | |||
Class A shares | (1,630,973) | (1,270,596) | |
Class C shares | (12,700) | (17,002) | |
Class I shares | (348,242) | (434,186) | |
Class Y shares | (562,276) | (660,485) | |
Total capital share activity | 1,493,195 | 3,207,525 | |
See notes to financial statements. |
14 calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT EMERGING MARKETS EQUITY FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017(a) (Unaudited) | Year Ended September 30, | Period Ended September 30, 2013(a)(b) | ||||||||||||
CLASS A SHARES | 2016(a) | 2015(a) | 2014(a) | |||||||||||
Net asset value, beginning | $12.94 | $10.90 | $13.15 | $13.34 | $12.00 | |||||||||
Income from investment operations: | ||||||||||||||
Net investment income (loss) | (0.01) | 0.08(c) | 0.11 | 0.08 | 0.13 | |||||||||
Net realized and unrealized gain (loss) | 0.73 | 2.06 | (1.92) | 0.46 | 1.34 | |||||||||
Total from investment operations | 0.72 | 2.14 | (1.81) | 0.54 | 1.47 | |||||||||
Distributions from: | ||||||||||||||
Net investment income | (0.07) | (0.10) | (0.03) | (0.04) | (0.13) | |||||||||
Net realized gain | — | — | (0.41) | (0.69) | — | |||||||||
Total distributions | (0.07) | (0.10) | (0.44) | (0.73) | (0.13) | |||||||||
Total increase (decrease) in net asset value | 0.65 | 2.04 | (2.25) | (0.19) | 1.34 | |||||||||
Net asset value, ending | $13.59 | $12.94 | $10.90 | $13.15 | $13.34 | |||||||||
Total return (d) | 5.60 | % | 19.75 | % | (14.18 | %) | 4.19 | % | 12.30 | % | ||||
Ratios to average net assets: (e) | ||||||||||||||
Net investment income (loss) | (0.15%)(f) | 0.66%(c) | 0.84 | % | 0.57 | % | 1.16%(f) | |||||||
Total expenses | 1.80%(f) | 1.95 | % | 2.18 | % | 2.22 | % | 3.03%(f) | ||||||
Net expenses | 1.27%(f) | 1.47 | % | 1.75 | % | 1.78 | % | 1.78%(f) | ||||||
Portfolio turnover | 30 | % | 32 | % | 66 | % | 95 | % | 74 | % | ||||
Net assets, ending (in thousands) | $27,787 | $39,343 | $23,569 | $20,628 | $6,337 | |||||||||
(a) Net investment income (loss) per share is calculated using the Average Shares Method. | ||||||||||||||
(b) From October 29, 2012 inception. | ||||||||||||||
(c) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.003 per share and 0.03% of average net assets. | ||||||||||||||
(d) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | ||||||||||||||
(e) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | ||||||||||||||
(f) Annualized. | ||||||||||||||
See notes to financial statements. |
calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 15
CALVERT EMERGING MARKETS EQUITY FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017(a) (Unaudited) | Year Ended September 30, | Period Ended September 30, 2013(a)(b) | ||||||||||||
CLASS C SHARES | 2016(a) | 2015(a) | 2014(a) | |||||||||||
Net asset value, beginning | $12.76 | $10.74 | $13.05 | $13.34 | $12.00 | |||||||||
Income from investment operations: | ||||||||||||||
Net investment income (loss) | (0.05) | —(c) | (0.03) | (0.05) | (0.01) | |||||||||
Net realized and unrealized gain (loss) | 0.71 | 2.03 | (1.87) | 0.45 | 1.37 | |||||||||
Total from investment operations | 0.66 | 2.03 | (1.90) | 0.40 | 1.36 | |||||||||
Distributions from: | ||||||||||||||
Net investment income | (0.02) | (0.01) | — | — | (0.02) | |||||||||
Net realized gain | — | — | (0.41) | (0.69) | — | |||||||||
Total distributions | (0.02) | (0.01) | (0.41) | (0.69) | (0.02) | |||||||||
Total increase (decrease) in net asset value | 0.64 | 2.02 | (2.31) | (0.29) | 1.34 | |||||||||
Net asset value, ending | $13.40 | $12.76 | $10.74 | $13.05 | $13.34 | |||||||||
Total return (d) | 5.16 | % | 18.94 | % | (14.98 | %) | 3.10 | % | 11.38 | % | ||||
Ratios to average net assets: (e) | ||||||||||||||
Net investment income (loss) | (0.79%)(f) | 0.02%(c) | (0.23 | %) | (0.41 | %) | (0.09%)(f) | |||||||
Total expenses | 4.31%(f) | 4.44 | % | 5.00 | % | 4.36 | % | 100.72%(f) | ||||||
Net expenses | 2.02%(f) | 2.21 | % | 2.70 | % | 2.78 | % | 2.78%(f) | ||||||
Portfolio turnover | 30 | % | 32 | % | 66 | % | 95 | % | 74 | % | ||||
Net assets, ending (in thousands) | $1,433 | $994 | $566 | $610 | $133 | |||||||||
(a) Net investment income (loss) per share is calculated using the Average Shares Method. | ||||||||||||||
(b) From October 29, 2012 inception. | ||||||||||||||
(c) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.003 per share and 0.03% of average net assets. | ||||||||||||||
(d) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | ||||||||||||||
(e) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | ||||||||||||||
(f) Annualized. | ||||||||||||||
See notes to financial statements. |
16 calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
CALVERT EMERGING MARKETS EQUITY FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017(a) (Unaudited) | Year Ended September 30, | Period Ended September 30, 2013(a)(b) | ||||||||||||
CLASS I SHARES | 2016(a) | 2015(a) | 2014(a) | |||||||||||
Net asset value, beginning | $13.06 | $10.99 | $13.26 | $13.49 | $12.00 | |||||||||
Income from investment operations: | ||||||||||||||
Net investment income | 0.02 | 0.12(c) | 0.14 | 0.10 | 0.19 | |||||||||
Net realized and unrealized gain (loss) | 0.71 | 2.09 | (1.93) | 0.48 | 1.33 | |||||||||
Total from investment operations | 0.73 | 2.21 | (1.79) | 0.58 | 1.52 | |||||||||
Distributions from: | ||||||||||||||
Net investment income | (0.10) | (0.14) | (0.07) | (0.12) | (0.03) | |||||||||
Net realized gain | — | — | (0.41) | (0.69) | — | |||||||||
Total distributions | (0.10) | (0.14) | (0.48) | (0.81) | (0.03) | |||||||||
Total increase (decrease) in net asset value | 0.63 | 2.07 | (2.27) | (0.23) | 1.49 | |||||||||
Net asset value, ending | $13.69 | $13.06 | $10.99 | $13.26 | $13.49 | |||||||||
Total return (d) | 5.80 | % | 20.31 | % | (13.92 | %) | 4.49 | % | 12.73 | % | ||||
Ratios to average net assets: (e) | ||||||||||||||
Net investment income | 0.29%(f) | 1.06%(c) | 1.12 | % | 0.78 | % | 1.61%(f) | |||||||
Total expenses | 1.34%(f) | 1.41 | % | 1.48 | % | 1.42 | % | 1.65%(f) | ||||||
Net expenses | 0.92%(f) | 1.12 | % | 1.40 | % | 1.42 | % | 1.43%(f) | ||||||
Portfolio turnover | 30 | % | 32 | % | 66 | % | 95 | % | 74 | % | ||||
Net assets, ending (in thousands) | $79,337 | $58,259 | $39,101 | $33,721 | $33,053 | |||||||||
(a) Net investment income per share is calculated using the Average Shares Method. | ||||||||||||||
(b) From October 29, 2012 inception. | ||||||||||||||
(c) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.003 per share and 0.03% of average net assets. | ||||||||||||||
(d) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | ||||||||||||||
(e) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | ||||||||||||||
(f) Annualized. | ||||||||||||||
See notes to financial statements. |
calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 17
CALVERT EMERGING MARKETS EQUITY FUND
FINANCIAL HIGHLIGHTS
Six Months Ended March 31, 2017(a) (Unaudited) | Year Ended September 30, | Period Ended September 30, 2013(a)(b) | ||||||||||||
CLASS Y SHARES | 2016(a) | 2015(a) | 2014(a) | |||||||||||
Net asset value, beginning | $13.17 | $11.10 | $13.35 | $13.48 | $12.00 | |||||||||
Income from investment operations: | ||||||||||||||
Net investment income | 0.01 | 0.16(c) | 0.12 | 0.10 | 0.14 | |||||||||
Net realized and unrealized gain (loss) | 0.73 | 2.05 | (1.93) | 0.49 | 1.36 | |||||||||
Total from investment operations | 0.74 | 2.21 | (1.81) | 0.59 | 1.50 | |||||||||
Distributions from: | ||||||||||||||
Net investment income | (0.10) | (0.14) | (0.03) | (0.03) | (0.02) | |||||||||
Net realized gain | — | — | (0.41) | (0.69) | — | |||||||||
Total distributions | (0.10) | (0.14) | (0.44) | (0.72) | (0.02) | |||||||||
Total increase (decrease) in net asset value | 0.64 | 2.07 | (2.25) | (0.13) | 1.48 | |||||||||
Net asset value, ending | $13.81 | $13.17 | $11.10 | $13.35 | $13.48 | |||||||||
Total return (d) | 5.71 | % | 20.09 | % | (13.96%) | 4.51 | % | 12.55 | % | |||||
Ratios to average net assets: (e) | ||||||||||||||
Net investment income | 0.20%(f) | 1.34%(c) | 0.95 | % | 0.78 | % | 1.28%(f) | |||||||
Total expenses | 1.45%(f) | 1.59 | % | 2.07 | % | 2.24 | % | 18.62%(f) | ||||||
Net expenses | 1.02%(f) | 1.18 | % | 1.50 | % | 1.53 | % | 1.53%(f) | ||||||
Portfolio turnover | 30 | % | 32 | % | 66 | % | 95 | % | 74 | % | ||||
Net assets, ending (in thousands) | $43,501 | $26,639 | $6,889 | $2,320 | $440 | |||||||||
(a) Net investment income per share is calculated using the Average Shares Method. | ||||||||||||||
(b) From October 29, 2012 inception. | ||||||||||||||
(c) Amount includes a non-recurring refund for overbilling of prior years' custody out-of-pocket fees. This amounted to $0.004 per share and 0.03% of average net assets. | ||||||||||||||
(d) Total return is not annualized for periods of less than one year and does not reflect deduction of any front-end or deferred sales charge. | ||||||||||||||
(e) Total expenses do not reflect amounts reimbursed and/or waived by the Adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. | ||||||||||||||
(f) Annualized. | ||||||||||||||
See notes to financial statements. |
18 calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
NOTES TO FINANCIAL STATEMENTS
NOTE A — SIGNIFICANT ACCOUNTING POLICIES
General: Calvert World Values Fund, Inc. (the “Corporation”) was organized as a Maryland corporation on February 14, 1992, and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Corporation operates four (4) separate series, or mutual funds, each with its own investment objective(s) and strategies, that are accounted for separately. This report contains the financial statements and financial highlights of Calvert Emerging Markets Equity Fund (the “Fund”). The Corporation is authorized to issue two billion shares of common stock, $0.01 par value per share, of which 250 million shares have been allocated to the Fund.
The investment objective of the Fund, which is diversified, is to seek long-term capital appreciation by investing primarily in equity securities of companies located in emerging market countries.
The Fund offers Class A, Class C, Class I and Class Y shares. Class A shares are generally sold with a maximum front-end sales charge of 4.75%. A contingent deferred sales charge of 0.80% may apply to certain redemptions of Class A shares for accounts for which no sales charge was paid, if redeemed within one year of purchase. Class C shares are sold without a front-end sales charge, and with certain exceptions, are charged a contingent deferred sales charge of 1% on shares redeemed within one year of purchase. Class C shares have higher levels of expenses than Class A shares. Class I shares require a minimum account balance of $1 million. The $1 million minimum initial investment is waived for retirement plans that trade through omnibus accounts and may be waived in certain other instances where it is believed to be in the best interest of the Fund and its shareholders. Class I shares have no front-end or contingent deferred sales charge and have lower levels of expenses than Class A shares. Class Y shares are generally only available to wrap or similar fee-based programs offered by financial intermediaries that have entered into an agreement with the Fund’s principal underwriter to offer Class Y shares to their clients, and retirement plans, foundations, endowments and other consultant-driven business. Class Y shares have no front-end or contingent deferred sales charge and have lower levels of expenses than Class A shares. Among other things, each class has different: (a) dividend rates due to differences in Distribution Plan expenses and other class-specific expenses; (b) exchange privileges; and (c) class-specific voting rights.
The Fund applies the accounting and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946, Financial Services – Investment Companies (ASC 946). Subsequent events, if any, through the date that the financial statements were issued have been evaluated in the preparation of the financial statements.
Security Valuation: Net asset value per share is determined every business day as of the close of the regular session of the New York Stock Exchange (generally 4:00 p.m. Eastern time). The Fund uses independent pricing services approved by the Board of Directors (the “Board”) to value its investments wherever possible. Investments for which market quotations are not available or deemed not reliable are fair valued in good faith under the direction of the Board.
The Board has adopted Valuation Procedures (the “Procedures”) to determine the fair value of securities and financial instruments for which market prices are not readily available or which may not be reliably priced. The Board has delegated the day-to-day responsibility for determining the fair value of securities and financial instruments of the Fund to the Fund's investment adviser (the “Adviser”) and has provided these Procedures to govern the Adviser in its valuation duties.
The Adviser has chartered an internal Valuation Committee to oversee the implementation of these Procedures and to assist it in carrying out the valuation responsibilities that the Board has delegated.
The Valuation Committee meets on a regular basis to review investments which may not have readily available market prices. The Valuation Committee’s fair valuation determinations are subject to review, approval and ratification by the Board at its next regularly scheduled meeting covering the calendar quarter in which the fair valuation was determined.
The Valuation Committee utilizes various methods to measure the fair value of the Fund’s investments. U.S. generally accepted accounting principles (U.S. GAAP) establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are summarized in the three broad levels listed below:
Level 1 - quoted prices in active markets for identical securities
Level 2 - other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
Level 3 - significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 19
Changes in valuation techniques may result in transfers in or out of an investment’s assigned level within the hierarchy during the period. Transfers in and/or out of levels are determined based on the fair value of such securities at the end of the period. Valuation techniques used to value the Fund’s investments by major category are as follows:
Common stocks and rights for which market quotations are readily available are valued at the last reported sale price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or the last available price and are categorized as Level 2 in the hierarchy. Foreign securities are valued based on quotations from the principal market in which such securities are normally traded. The Fund has retained a third party fair value pricing service to quantitatively analyze the price movement of its holdings on foreign exchanges and to automatically fair value these securities each business day. The third party fair value pricing service takes into account many factors, including, but not limited to, movements in U.S. securities markets and changes in futures contracts and foreign exchange rates that have occurred after the close of the principal foreign market, to determine a fair value as of the close of the New York Stock Exchange. Such securities are categorized as Level 2 in the hierarchy.
For restricted securities and private placements (equity and debt) where observable inputs may be limited, assumptions about market activity and risk are used and such securities are categorized as either Level 2 or Level 3 in the hierarchy depending on the relative significance of valuation inputs.
Participatory notes are valued based on the value of the underlying equity security as determined using the valuation techniques for equity securities listed above. Participatory notes are categorized as Level 2 in the hierarchy.
Mutual funds are valued at their closing net asset value each business day and are categorized as Level 1 in the hierarchy.
If a market value cannot be determined for a security using the methodologies described above, or if, in the good faith opinion of the Adviser, the market value does not constitute a readily available market quotation, or if a significant event has occurred that would materially affect the value of the security, the security will be fair valued as determined in good faith by the Valuation Committee.
The Valuation Committee considers a number of factors, including significant unobservable valuation inputs when arriving at fair value. It considers all significant facts that are reasonably available and relevant to the determination of fair value.
The Valuation Committee primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. When more appropriate, the Fund may employ an income-based or cost approach. An income-based valuation approach discounts anticipated future cash flows of the investment to calculate a present amount (discounted). The measurement is based on the value indicated by current market expectations about those future amounts. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. A cost-based approach is based on the amount that currently would be required to replace the service capacity of an asset (current replacement cost). From the seller’s perspective, the price that would be received for the asset is determined based on the cost to a buyer to acquire or construct a substitute asset of comparable utility, adjusted for obsolescence.
The values assigned to fair value investments are based on available information and do not necessarily represent amounts that might ultimately be realized. Further, due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed, and the differences could be material. The Valuation Committee employs various methods for calibrating these valuation approaches including a regular review of key inputs and assumptions, transactional back-testing or disposition analysis and reviews of any related market activity.
The following table summarizes the market value of the Fund's holdings as of March 31, 2017, based on the inputs used to value them:
20 calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
VALUATION INPUTS | |||||||||||
INVESTMENTS IN SECURITIES | LEVEL 1 | LEVEL 2 | LEVEL 3 | TOTAL | |||||||
Common Stocks | |||||||||||
Argentina | $2,358,245 | $— | $— | $2,358,245 | |||||||
Brazil | 12,276,857 | — | — | 12,276,857 | |||||||
Chile | 2,085,983 | — | — | 2,085,983 | |||||||
China | 9,763,027 | 14,405,790 | — | 24,168,817 | |||||||
India | 4,991,374 | 15,676,836 | — | 20,668,210 | |||||||
Mexico | 5,076,777 | — | — | 5,076,777 | |||||||
Peru | 2,537,845 | — | — | 2,537,845 | |||||||
Russia | 1,857,682 | 5,165,581 | — | 7,023,263 | |||||||
Taiwan | 8,139,919 | 14,394,084 | — | 22,534,003 | |||||||
Other Countries* | — | 40,645,402 | — | 40,645,402 | |||||||
Total Common Stocks | 49,087,709 | 90,287,693** | — | 139,375,402 | |||||||
Rights | 110,982 | — | — | 110,982 | |||||||
Participatory Notes | — | 5,870,342 | — | 5,870,342 | |||||||
High Social Impact Investments | — | 1,871,580 | 90,910 | 1,962,490 | |||||||
Short Term Investment of Cash Collateral For Securities Loaned | 3,900,485 | — | — | 3,900,485 | |||||||
TOTAL | $53,099,176 | $98,029,615 | $90,910^ | $151,219,701 | |||||||
* For further breakdown of equity securities by country, please refer to the Schedule of Investments. | |||||||||||
** Includes certain securities trading primarily outside the U.S. where the value was adjusted as a result of significant market movements following the close of local trading. | |||||||||||
^ Level 3 securities represent 0.1% of net assets. |
On March 31, 2017, price movements exceeded specified parameters and the third party fair value pricing service quantitatively fair valued the affected securities. As a result, $3,048,175 transferred out of Level 1 into Level 2. The amount of this transfer was determined based on the fair value of the securities at the end of the period.
Participatory Notes: The Fund may gain exposure to securities in certain foreign markets through investments in participatory notes (“P-notes”), especially in markets where direct investment by the Fund is not possible. P-notes are generally issued by a bank or broker-dealer (the “counterparty”) and are designed to offer a return linked to a particular underlying equity security. While the holder of a P-note is entitled to receive from the counterparty any dividends paid by the underlying security, the counterparty retains legal ownership and voting rights of the underlying security. The risks associated with investing in a P-note may include the possible failure of the counterparty to perform its obligations under the terms of the agreement, an inability to liquidate or transfer the notes, and an imperfect correlation between the value of the P-note and the underlying security.
Restricted Securities: The Fund may invest in securities that are subject to legal or contractual restrictions on resale. Generally, these securities may only be sold publicly upon registration under the Securities Act of 1933 or in transactions exempt from such registration. Information regarding restricted securities is included at the end of the Schedule of Investments.
Security Transactions and Investment Income: Security transactions are accounted for on trade date. Realized gains and losses are recorded on an identified cost basis and may include proceeds from litigation. Dividend income is recorded on the ex-dividend date or, in the case of dividends on certain foreign securities, as soon as the Fund is informed of the ex-dividend date. Withholding taxes on foreign dividends have been provided for in accordance with the Fund’s understanding of the applicable country’s tax rules and rates. Distributions received that represent a return of capital are recorded as a reduction of cost of investments. Distributions received that represent a capital gain are recorded as a realized gain. Interest income, which includes amortization of premium and accretion of discount on debt securities, is accrued as earned.
Share Class Accounting: Investment income and realized and unrealized gains and losses are allocated to separate classes of shares based upon the relative net assets of each class. Expenses common to the classes are also allocated to each class in proportion to their relative net assets. Expenses arising in connection with a specific class are charged directly to that class.
Foreign Currency Transactions: The Fund’s accounting records are maintained in U.S. dollars. For valuation of assets and liabilities on each date of net asset value determination, foreign denominations are converted into U.S. dollars using the current exchange rate. Security transactions, income, and expenses are translated at the prevailing rate of exchange on the date of the event. Recognized gains or losses on investment transactions attributable to changes in foreign currency exchange rates are
calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 21
recorded for financial statement purposes as net realized gains and losses on investments. That portion of unrealized gains and losses on investments that results from fluctuations in foreign currency exchange rates is not separately disclosed.
Distributions to Shareholders: Distributions to shareholders are recorded by the Fund on ex-dividend date. Dividends from net investment income and distributions from net realized capital gains, if any, are paid at least annually. Distributions are determined in accordance with income tax regulations which may differ from U.S. GAAP; accordingly, periodic reclassifications are made within the Fund's capital accounts to reflect income and gains available for distribution under income tax regulations.
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 and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.
Federal Income Taxes: No provision for federal income or excise tax is required since the Fund intends to continue to qualify as a regulated investment company under the Internal Revenue Code and to distribute substantially all of its taxable earnings.
Management has analyzed the Fund's tax positions taken for all open federal income tax years and has concluded that no provision for federal income tax is required in the Fund's financial statements. A Fund's federal tax return is subject to examination by the Internal Revenue Service for a period of three years.
Interim Financial Statements: The interim financial statements relating to March 31, 2017 and for the six months then ended have not been audited by an independent registered public accounting firm, but in the opinion of the Fund’s management, reflect all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the financial statements.
NOTE B — RELATED PARTY TRANSACTIONS
Effective December 31, 2016, Calvert Research and Management (CRM), a subsidiary of Eaton Vance Management (EVM), became the investment adviser to the Fund following a transaction between CRM and certain of its affiliates and Calvert Investment Management, Inc. (CIM) and certain of its affiliates, pursuant to which CRM acquired substantially all of the business assets of CIM after satisfying various closing conditions, including shareholder approval of a new investment advisory agreement between the Fund and CRM (the “Transaction”).
For its services pursuant to the new investment advisory agreement, CRM receives a fee, payable monthly, at the annual rate of 0.88% of the Fund’s average daily net assets. Prior to December 31, 2016, CIM, a direct subsidiary of Calvert Investments, Inc. and an indirect subsidiary of Ameritas Holding Company, provided investment advisory services to the Fund. For its services, CIM received a fee at the same annual rate of 0.95% of the Fund's average daily net assets. For the six months ended March 31, 2017, the investment advisory fee amounted to $584,493 or 0.91% (annualized) of the Fund's average daily net assets, of which $302,276 was paid to CRM and $282,217 was paid to CIM.
Pursuant to a sub-advisory agreement effective December 31, 2016, CRM pays Hermes Investment Management Limited (Hermes) a portion of its investment advisory fee for sub-advisory services provided to the Fund. Prior to December 31, 2016, CIM paid Hermes a portion of its investment advisory fee for sub-advisory services provided to the Fund.
CRM and Hermes (CIM and Hermes for the period October 1, 2016 through December 30, 2016) have agreed to reimburse the Fund’s operating expenses to the extent that total annual operating expenses (relating to ordinary operating expenses only and excluding expenses such as brokerage commissions, acquired fund fees and expenses of unaffiliated funds, interest expense, taxes or litigation expenses) exceed 1.27%, 2.02%, 0.92% and 1.02% for Class A, Class C, Class I and Class Y, respectively, of such class’ average daily net assets. The expense reimbursement agreement may be changed or terminated after January 31, 2018. For the six months ended March 31, 2017, CRM and Hermes waived or reimbursed in total expenses of $157,026 and CIM and Hermes waived or reimbursed expenses of $135,039. A portion of the expenses waived or reimbursed was borne by Hermes.
The administrative fee is earned by CRM as compensation for administrative services rendered to the Fund. The fee is computed at an annual rate of 0.12% of the Fund’s average daily net assets and is payable monthly. CRM has agreed to contractually waive 0.02% of the administrative fee through January 31, 2018 for Class I. Prior to December 31, 2016, Calvert Investment Administrative Services, Inc. (CIAS), an affiliate of CIM, provided administrative services to the Fund at an annual rate of 0.12% of the Fund's average daily net assets, payable monthly. In addition, CIAS contractually waived administrative fees of 0.02% for the period October 1, 2016 through December 30, 2016 for Class I. For the six months ended March 31, 2017, CRM was paid administrative fees of $41,204, of which $3,603 were waived and CIAS was paid administrative fees of $35,663, of which $3,000 were waived.
The Fund adopted a new distribution plan for Class A shares (Class A Plan) and Class C shares (Class C Plan) pursuant to Rule 12b-1 under the 1940 Act, which were approved by the Board of Directors and became effective as of December 31, 2016 or shortly thereafter upon approval by the shareholders of the respective class. Pursuant to the Class A Plan and Class C Plan, the
22 calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
Fund pays a distribution fee of 0.25% and 0.75% per annum for Class A and Class C, respectively, and a service fee of 0.25% per annum for Class C of its average daily net assets attributable to such class for distribution services and facilities provided to the Fund, as well as for personal and/or account maintenance services provided. Pursuant to the Fund’s former distribution plans for Class A shares and Class C shares, the Fund was permitted to pay certain expenses associated with the distribution and servicing of its Class A and Class C shares not to exceed 0.25% for Class A and 1.00% for Class C of the Fund’s average daily net assets with respect to such class. Effective December 31, 2016, the fees are paid to Eaton Vance Distributors, Inc. (EVD), an affiliate of CRM and the Fund’s principal underwriter. Prior to December 31, 2016, the fees were paid to Calvert Investment Distributors, Inc. (CID), an affiliate of CIM and the Fund’s former distributor and principal underwriter. Distribution and service fees paid or accrued for the six months ended March 31, 2017 amounted to $39,003 or 0.25% per annum of Class A’s average daily net assets, of which $19,299 was paid to EVD and $19,704 was paid to CID, and $5,558 or 1.00% per annum of Class C’s average daily net assets, of which $3,118 was paid to EVD and $2,440 was paid to CID.
The Fund was informed that EVD and CID received $3,116 and $1,712, respectively, as their portion of the sales charge on sales of Class A shares for the six months ended March 31, 2017. The Fund was also informed that EVD and CID received $747 and $981, respectively, of contingent deferred sales charges paid by Fund shareholders for the same period.
Effective December 31, 2016, EVM provides sub-transfer agency services to the Fund pursuant to a Sub-Transfer Agency Support Services Agreement. For its services, EVM receives an annual fee of $8 per shareholder account. Prior to December 31, 2016, Calvert Investment Services, Inc. (CIS), an affiliate of CIM, acted as the shareholder servicing agent for the Fund and received a fee at the same rate as is paid to EVM. For the six months ended March 31, 2017, sub-transfer agency fees paid to EVM were $3,670 and shareholder servicing fees paid to CIS were $3,013. Such fees are included in transfer agency fees and expenses on the Statement of Operations.
Each Director of the Fund who is not an employee of CRM or its affiliates receives a fee of $3,000 for each Board meeting attended in person and $2,000 for each Board meeting attended by phone plus an annual fee of $52,000, and $1,500 for each Committee meeting attended in person and $1,000 for each Committee meeting attended by phone plus an annual Committee fee of $2,500. The Board chair receives an additional $10,000 annual retainer and Committee chairs receive an additional $6,000 annual retainer. Prior to December 31, 2016, each Director of the Fund who was not an employee of CIM or its affiliates received a fee of $3,000 for each Board meeting attended plus an annual fee of $52,000. Committee members received $500 for each Committee meeting attended plus an annual fee of $2,500. Committee chairs received an additional annual retainer ranging from $6,000 to $10,000. Eligible Directors may participate in a Deferred Compensation Plan (the “Plan”). Amounts deferred under the Plan are treated as though equal dollar amounts had been invested in shares of the Fund or other Calvert funds selected by the Directors. The Fund purchases shares of the funds selected equal to the dollar amounts deferred under the Plan, resulting in an asset equal to the deferred compensation liability. Obligations of the Plan are paid solely from the Fund’s assets. Directors’ fees are allocated to each of the Calvert funds served. Salaries and fees of officers and Directors of the Fund who are employees of CRM and, prior to December 31, 2016, of CIM or their affiliates are/were paid by CRM and CIM, respectively. In addition, in connection with the Transaction, an advisory council was established to aid the Board and the Calvert funds’ Adviser in advancing the cause of responsible investing through original scholarship and thought leadership. The advisory council consists of the Adviser’s Chief Executive Officer and four additional members. Each member (other than the Adviser’s Chief Executive Officer) receives annual compensation of $75,000, which will be reimbursed by CIM and Ameritas Holding Company for a period of up to three years.
NOTE C — INVESTMENT ACTIVITY AND TAX INFORMATION
During the six months ended March 31, 2017, the cost of purchases and proceeds from sales of investments, other than short-term securities, were $56,977,354 and $39,782,979, respectively.
At September 30, 2016, the Fund, for federal income tax purposes, had the following capital loss carryforwards which would reduce the Fund’s taxable income arising from future net realized gains on investment transactions, if any, to the extent permitted by the Internal Revenue Code, and thus would reduce the amount of distributions to shareholders, which would otherwise be necessary to relieve the Fund of any liability for federal income or excise tax.
Capital Loss Carryforwards | |||
NO EXPIRATION DATE | |||
Short-term | ($620,944 | ) | |
Long-term | (1,304,523 | ) |
calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 23
Under the Regulated Investment Company Modernization Act of 2010, capital losses incurred in taxable years beginning after December 22, 2010 can be carried forward to offset future capital gains for an unlimited period. These losses will retain their character as either long-term or short-term.
The cost and unrealized appreciation (depreciation) of investments of the Fund at March 31, 2017, as determined on a federal income tax basis, were as follows:
Unrealized appreciation | $22,042,516 | ||
Unrealized (depreciation) | (3,017,622 | ) | |
Net unrealized appreciation (depreciation) | $19,024,894 | ||
Federal income tax cost of investments | $132,194,807 |
NOTE D — SECURITIES LENDING
To generate additional income, the Fund may lend its securities pursuant to a securities lending agency agreement (“Lending Agreement”) with State Street Bank, the securities lending agent. Security loans are subject to termination by the Fund at any time and, therefore, are not considered to be illiquid investments. The Fund requires that the loan be continuously collateralized by either cash or securities as collateral equal at all times to at least 102% of the market value of the domestic securities loaned and 105% of the market value of the international securities loaned (if applicable). Cash collateral is generally invested in State Street Institutional U.S. Government Money Market Fund (the “U.S. Government Fund”) that is managed by an affiliate of the custodian. The U.S. Government Fund is a registered money market fund that invests in a variety of high-quality, U.S. dollar denominated instruments. Any gain or loss in the market price of the loaned securities that might occur and any interest earned or dividends declared during the term of the loan would accrue to the account of the Fund. Income earned on the investment of collateral, net of broker rebates and other expenses incurred by the securities lending agent, is split between the Fund and the securities lending agent on the basis of agreed upon contractual terms.
The risks associated with lending portfolio securities include, but are not limited to, possible delays in receiving additional collateral or in the recovery of the loaned securities, possible loss of rights to the collateral should the borrower fail financially, as well as risk of loss in the value of the collateral or the value of the investments made with the collateral. The securities lending agent shall indemnify the Fund in the case of default of any securities borrower.
The total value of securities on loan was $3,438,805 as of March 31, 2017.
The following table displays a breakdown of transactions accounted for as secured borrowings, the obligations by class of collateral pledged, and the remaining contractual maturity of those transactions as of March 31, 2017.
Remaining Contractual Maturity of the Agreements as of March 31, 2017 | |||||
Overnight and Continuous | <30 days | Between 30 & 90 days | >90 days | Total | |
Securities Lending Transactions | |||||
Common Stocks | $3,900,485 | $— | $— | $— | $3,900,485 |
Amount of recognized liabilities for securities lending transactions | $3,900,485 |
The carrying amount of the liability for collateral for securities loaned at March 31, 2017 approximated its fair value. If measured at fair value, such liability would have been considered as Level 2 in the fair value hierarchy (see Note A) at March 31, 2017.
NOTE E — LINE OF CREDIT
A financing agreement is in place with the Calvert Funds and State Street Bank and Trust Company (SSB). Under the agreement, which expires on August 8, 2017, SSB provides an unsecured line of credit facility, in the aggregate amount of $50 million ($25 million committed and $25 million uncommitted), accessible by the Calvert Funds for temporary or emergency purposes only. Borrowings bear interest at the higher of the One-Month London Interbank Offered Rate (LIBOR) in effect that day or the overnight Federal Funds Rate plus 1.25% per annum. A commitment fee of 0.25% per annum is incurred on the unused portion of the committed facility. An administrative fee of $30,000 was paid in connection with the uncommitted facility. These fees are allocated to all participating funds. Because the line of credit is not available exclusively to the Fund, it may be unable to borrow some or all of its requested amounts at any particular time. The Fund had no loans outstanding pursuant to this line of credit at March 31, 2017.
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For the six months ended March 31, 2017, borrowing information by the Fund under the agreement was as follows:
Average Daily Balance | Weighted Average Interest Rate | Maximum Amount Borrowed | Month of Maximum Amount Borrowed |
$194,408 | 1.79% | $5,521,339 | October 2016 |
NOTE F - RISKS ASSOCIATED WITH FOREIGN INVESTMENTS
Investing in foreign securities involves additional risks relating to political, social, and economic developments abroad. Other risks result from differences between regulations that apply to U.S. and foreign issuers and markets, and the potential for foreign markets to be less liquid and more volatile than U.S. markets. Securities that trade or are denominated in currencies other than the U.S. dollar may be adversely affected by fluctuations in currency exchange rates.
The risks of investing in emerging market securities are greater than those of investing in securities of developed foreign countries. These risks include volatile currency exchange rates, periods of high inflation, increased risk of default, greater social, economic and political uncertainty and instability, less governmental supervision and regulation of securities markets, weaker auditing and financial reporting standards, lack of liquidity in the markets, and the significantly smaller market capitalizations of emerging market issuers.
NOTE G - AFFILIATED COMPANIES
The Fund invests a portion of its assets designated for high social impact investments in notes issued by the Calvert Social Investment Foundation (the “Foundation”) pursuant to an exemptive order granted by the U.S. Securities and Exchange Commission (the “SEC”). The Fund relies on exemptive relief to invest in the notes because the Fund’s investments in the notes may be considered prohibited transactions between affiliated persons under the 1940 Act. The Foundation may be considered an affiliated person of the Calvert Funds based on the overlap between the Foundation’s Board of Directors and the Funds’ Directors/Trustees and other potential affiliations. The Foundation has licensed use of the Calvert name from the Adviser, and the Adviser’s President and Chief Executive Officer serves on the Foundation Board. The Foundation is not owned or otherwise controlled by the Adviser or its affiliates. Transactions in affiliated companies by the Fund for the six months ended March 31, 2017 were as follows:
Name of Affiliated Company | Principal Amount, beginning of period | Gross Additions | Gross Reductions | Principal Amount, end of period | Value, end of period | Interest Income | Net Realized Gain (Loss) | Capital Gain Distributions Received | Change In Unrealized Appreciation (Depreciation) | |||||||||||
Calvert Social Investment Foundation, Community Investment Notes, 1.00%, 5/5/17 | $2,000,000 | $— | ($2,000,000) | $— | $— | $4,111 | $— | $— | $35,580 | |||||||||||
Calvert Social Investment Foundation, Community Investment Notes, 1.50%, 12/16/19 | — | 2,000,000 | — | 2,000,000 | 1,871,580 | 8,917 | — | — | (128,420 | ) | ||||||||||
TOTALS | $1,871,580 | $13,028 | $— | $— | ($92,840 | ) |
calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED) 25
SPECIAL MEETING OF SHAREHOLDERS (UNAUDITED)
The Special Meeting of Shareholders of Calvert Emerging Markets Equity Fund, a series of Calvert World Values Fund, Inc. (the “Fund”) was held on December 16, 2016 and adjourned to December 23, 2016, December 28, 2016 and January 6, 2017.
Shareholders of the Fund voted on the following proposals:
1. | Approval of a new investment advisory agreement with Calvert Research and Management. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
4,503,667 | 63,107 | 81,082 | 1,491,938 |
2. | Approval of a new investment sub-advisory agreement with Hermes Investment Management Limited. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
4,441,478 | 43,957 | 162,420 | 1,491,938 |
3. | Reaffirmation and approval of the Fund’s ability to invest in notes issued by Calvert Social Investment Foundation. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
4,522,181 | 45,505 | 80,171 | 1,491,937 |
4. | Approval of the Fund’s reliance on a potential future exemptive order that may be granted by the U.S. Securities and Exchange Commission. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
4,488,360 | 44,085 | 115,408 | 1,491,940 |
Shareholders of Class A shares of the Fund voted on the following proposal:
1. | Approval of Master Distribution Plan for Class A shares of the Fund pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
1,094,708 | 23,541 | 80,709 | 421,528 |
Shareholders of Class C shares of the Fund voted on the following proposal:
1. | Approval of Master Distribution Plan for Class C shares of the Fund pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended. |
Number of Shares* | |||
For | Against | Abstain** | Uninstructed** |
36,701 | 0 | 5,842 | 6,465 |
26 calvert.com CALVERT EMERGING MARKETS EQUITY FUND SEMIANNUAL REPORT (UNAUDITED)
Shareholders of Calvert World Values Fund, Inc. voted on the following proposal:
1. | To elect Directors of Calvert World Values Fund, Inc.: |
Number of Shares* | ||
Nominee | For | Withheld |
Richard L. Baird, Jr. | 39,776,422 | 1,439,396 |
Alice Gresham Bullock | 39,831,328 | 1,384,490 |
Cari Dominguez | 39,839,990 | 1,375,828 |
Miles D. Harper III | 39,768,678 | 1,447,140 |
John G. Guffey, Jr. | 39,771,630 | 1,444,188 |
Joy V. Jones | 39,842,813 | 1,373,004 |
Anthony A. Williams | 35,278,280 | 5,937,538 |
John H. Streur | 39,768,579 | 1,447,239 |
* | Excludes fractional shares. |
** | Uninstructed shares (i.e., proxies from brokers or nominees indicating that such persons have not received instructions from the beneficial owner or other person entitled to vote shares on a particular matter with respect to which the brokers or nominees do not have discretionary power) were treated as shares that were present at the meeting for purposes of establishing a quorum, but had the effect of a vote against the proposals. Uninstructed shares are sometimes referred to as broker non-votes. Abstentions were also treated in this manner. |
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BOARD APPROVAL OF INVESTMENT ADVISORY AGREEMENT
Calvert Emerging Markets Equity Fund
At a meeting held on October 14, 2016, the Board of Directors of Calvert World Values Fund, Inc. (“CWVF”), and by a separate vote, the Directors who are not “interested persons” of CWVF (the “Independent Directors”), approved a new Investment Advisory Agreement between CWVF and Eaton Vance Investment Advisors (renamed Calvert Research and Management) (“CRM” or the “Adviser”) and a new Investment Sub-Advisory Agreement between the Adviser and Hermes Investment Management Limited (the “Sub-Adviser”), each with respect to the Calvert Emerging Markets Equity Fund (the “Fund”). The Board was advised that, subject to shareholder approval and certain other conditions, the new Investment Advisory and Investment Sub-Advisory Agreements would take effect upon the acquisition of substantially all of the business assets of Calvert Investment Management, Inc. (“CIM”) by Eaton Vance Corporation (“Eaton Vance”) (the “Transaction”).
In connection with the proposed Transaction, the Independent Directors, assisted by their independent legal counsel, requested extensive information from CIM and Eaton Vance regarding the proposed Transaction and its potential implications for the Calvert Funds. The Independent Directors also received information from the Sub-Adviser concerning the services to be provided to the Fund. The Independent Directors reviewed and discussed this information and received advice from their independent legal counsel regarding their responsibilities in evaluating the possible Transaction and the new Investment Advisory and Investment Sub-Advisory Agreements.
The Independent Directors met separately on multiple occasions to discuss the Transaction and the proposed change in investment adviser. The interested Directors participated in portions of these meetings to provide the perspective of the Calvert organization, but did not otherwise participate in the deliberations of the Independent Directors regarding the possible change in investment adviser.
In the course of their deliberations regarding the new Investment Advisory Agreement, the Directors considered the following factors, among others: the nature, extent and quality of the services to be provided by CRM and its affiliates, including the personnel who would be providing such services; Eaton Vance’s financial condition; the proposed advisory fees; comparative fee and expense information for the Calvert Funds and for comparable funds managed by Eaton Vance or its affiliates; the anticipated profitability of the Calvert Funds to CRM and its affiliates; the direct and indirect benefits, if any, to be derived by CRM and its affiliates from their relationship with the Calvert Funds; the effect of each Calvert Fund's projected growth and size on each Calvert Fund's performance and expenses; and CRM’s compliance program.
In considering the nature, extent, and quality of the services to be provided to the Fund by CRM under the new Investment Advisory Agreement, the Directors took into account information provided by Eaton Vance or its affiliates relating to its operations and personnel, including, among other information, biographical information on its supervisory and professional staff and descriptions of its organizational and management structure. The Directors considered the new investment strategies to be used in managing certain Calvert Funds and the performance of other funds managed by the investment teams at Eaton Vance or its affiliates that would be managing certain Calvert Funds. The Directors also took into account CRM’s and Eaton Vance’s proposed staffing and overall resources, and noted that the staff of CRM was expected to include certain current employees of CIM as well as certain employees of affiliates of Eaton Vance under a “dual-hat” arrangement. CRM’s administrative capabilities were also considered. The Directors concluded that they were satisfied with the nature, extent and quality of services to be provided to the Fund by CRM under the new Investment Advisory Agreement.
In considering the Fund’s performance, the Board noted that it reviewed on a quarterly basis detailed information about the Fund’s performance results, portfolio composition and investment strategies. The Board also reviewed various comparative data provided to it in connection with its consideration of the new Investment Advisory and Investment Sub-Advisory Agreements, including, comparisons of the Fund’s returns with those of its benchmark and the average of its Lipper category for the one- and three-year periods ended July 31, 2016.
In considering the Fund’s proposed fees and estimated expenses, the Directors considered certain comparative fee and expense data provided by Eaton Vance or its affiliates. The Directors also took into account that there were no increases in the advisory fees being proposed and that for certain Calvert Funds, such as the Fund, CRM had proposed a reduction in advisory fees. The Directors further noted that CRM had agreed to maintain current fee waivers/expense reimbursements, if any, for certain Calvert Funds, and increase the fee waivers/expense reimbursements for other Calvert Funds. Based upon their review the Directors concluded that the proposed advisory fee was reasonable in view of the quality of services to be received by the Fund from CRM.
In reviewing the anticipated profitability of the Fund to CRM and its affiliates, the Directors considered the fact that affiliates of CRM would be providing shareholder servicing, administrative and distribution services to the Fund for which they would receive compensation. The Board also took into account whether CRM had the financial wherewithal to provide services to the Fund. The Board also considered that CRM would likely derive benefits to its reputation and other indirect benefits from its relationship with
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the Fund. Based upon its review, the Board concluded that CRM’s and its affiliates’ anticipated level of profitability from their relationship with the Fund was reasonable.
The Directors considered the effect of each Calvert Fund’s current size and potential growth on its performance and expenses. The Directors took into account management’s discussion of the Calvert Funds’ proposed advisory and sub-advisory fees. The Directors noted that the advisory fee schedule for certain Calvert Funds, will contain breakpoints that will reduce the respective advisory fee rate on assets above specified levels as the applicable Calvert Fund’s assets increased and considered the necessity of adding breakpoints with respect to the Calvert Funds that did not currently have such breakpoints in their advisory fee schedule. The Directors determined that adding breakpoints at specified levels to the advisory fee schedules of the Calvert Funds that did not currently have breakpoints, such as the Fund, would not be appropriate at this time. The Directors noted that if the Fund’s assets increased over time, the Fund might realize economies of scale if assets increase proportionally more than certain other expenses.
In considering the approval of the new Investment Advisory Agreement, the Directors also considered the following matters:
(i) their belief that the Transaction will benefit the Calvert Funds, including the Fund;
(ii) the continued management of the Fund in a manner materially consistent with the Fund’s existing investment objective and principal investment strategies, which includes continuing to manage the Fund pursuant to responsible investment criteria as described in the prospectus;
(iii) the financial condition and reputation of Eaton Vance and its affiliates, its worldwide presence, experience as a fund sponsor and manager, commitment to maintain a high level of cooperation with, and support to, the Calvert Funds, including the Fund, strong distribution and client service capabilities, and relationships in the asset management industry;
(iv) the intention expressed by representatives of Eaton Vance to retain certain of the existing members of the Calvert management team and other key professionals, including members of the Calvert Sustainability Research Department, in order to better continue principles-based investment research following the closing of the Transaction;
(v) Eaton Vance’s commitment to maintaining competitive compensation arrangements to attract and retain highly qualified personnel; and
(vi) that the current senior management team at Calvert has indicated its strong support of the Transaction.
In approving the new Investment Advisory Agreement with CRM, the Directors did not identify any single factor as controlling, and each Director may have attributed different weight to various factors.
The Directors reached the following conclusions regarding the new Investment Advisory Agreement, among others: (a) CRM has demonstrated that it possesses the capability and resources to perform the duties required of it under the Investment Advisory Agreement and (b)†the advisory fees are reasonable in view of the quality of the services to be received by the Fund from CRM. Based on the foregoing considerations, the Directors, including the Independent Directors, approved the new Investment Advisory Agreement, subject to the approval of the Fund’s shareholders.
In connection with the proposed Transaction, the Board determined that it would be in the Fund’s best interests to have the Sub-Adviser continue to provide sub-advisory services to the Fund. The Board reviewed and discussed information provided by the Sub-Adviser and received advice from their independent legal counsel regarding their responsibilities in evaluating the proposed Transaction and the new Investment Sub-Advisory Agreement.
In evaluating the new Investment Sub-Advisory Agreement, the Directors considered information provided by the Sub-Adviser relating to its operations, personnel, investment philosophy, strategies, and techniques. Among other information, the Sub-Adviser provided biographical information on portfolio management and other professional staff, performance information for itself, and descriptions of its investment philosophies, strategies and techniques, organizational and management structures, and brokerage policies and practices.
In the course of their deliberations concerning the new Investment Sub-Advisory Agreement, the Directors evaluated, among other factors: the nature, extent and the quality of the services to be provided by the Sub-Adviser; the Sub-Adviser’s management style and long-term performance record; the Fund’s performance record and the Sub-Adviser’s performance in executing its investment strategies; the Sub-Adviser’s current level of staffing and its overall resources; the qualifications and experience of the Sub-Adviser’s personnel; and the Sub-Adviser’s financial condition with respect to its ability to perform the services required under the new Investment Sub-Advisory Agreement. The Directors noted that they reviewed detailed information about the performance results, portfolio composition and investment strategies for the Fund on a quarterly basis. The Directors also took into account that no material changes were being proposed to the investment strategies the Sub-Adviser used in managing the Fund. Based upon their review, the Directors concluded that they were satisfied with the nature, extent and quality of services to be provided to the Fund by the Sub-Adviser under the new Investment Sub-Advisory Agreement.
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In considering the cost of services to be provided by the Sub-Adviser and the profitability to the Sub-Adviser of its relationship with the Fund, the Directors noted that CRM would pay the sub-advisory fees to the Sub-Adviser out of its advisory fee. The Board also relied on the ability of CRM to negotiate the proposed sub-advisory fee at arm’s length with the Sub-Adviser. Based upon their review, the Directors determined that the proposed sub-advisory fee was reasonable in view of the quality of services to be received by the Fund from the Sub-Adviser. Because CRM would pay the Sub-Adviser’s sub-advisory fees and those fees were negotiated at arm’s length by CRM, the cost of services provided by the Sub-Adviser and the profitability to the Sub-Adviser of its relationship with the Fund were not material factors in the Board’s deliberations. For similar reasons, the Board did not consider the potential economies of scale in the Sub-Adviser’s management of the Fund to be a material factor in its consideration.
In approving the new Investment Sub-Advisory Agreement, the Directors did not identify any single factor as controlling, and each Director may have attributed different weight to various factors.
The Directors reached the following conclusions regarding the new Investment Sub-Advisory Agreement, among others: (a) the Sub-Adviser is qualified to manage the Fund’s assets in accordance with the Fund’s investment objectives and policies; (b) the Sub-Adviser is likely to execute its investment strategies consistently over time; and (c) the proposed sub-advisory fees are reasonable in view of the quality of services to be received by the Fund from the Sub-Adviser. Based upon the foregoing considerations, the Directors, including the Independent Directors, approved the new Investment Sub-Advisory Agreement, subject to approval of the Fund's shareholders.
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OFFICERS AND DIRECTORS
Officers of Calvert Emerging Markets Equity Fund
Hope Brown
Chief Compliance Officer
Maureen A. Gemma(1)
Secretary and Vice President
James F. Kirchner(1)
Treasurer
Directors of Calvert Emerging Markets Equity Fund
Alice Gresham Bullock(2)(4)
Chairperson
Richard L. Baird, Jr.(4)
Cari Dominguez(2)(4)
John G. Guffey, Jr.(4)
Miles D. Harper, III(4)
Joy V. Jones(4)
John H. Streur(3)
Anthony A. Williams(2)(4)
(1)Ms. Gemma and Mr. Kirchner began serving as Officers effective December 31, 2016.
(2)Mmes. Bullock and Dominguez and Mr. Williams began serving as Directors effective December 23, 2016.
(3)Interested Director and President
(4)Independent Director
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IMPORTANT NOTICES
Privacy. The Calvert organization is committed to ensuring your financial privacy. Each of the financial institutions identified below has in effect the following policy (“Privacy Policy”) with respect to nonpublic personal information about its customers:
• | Only such information received from you, through application forms or otherwise, and information about your Calvert fund transactions will be collected. This may include information such as name, address, social security number, tax status, account balances and transactions. |
• | None of such information about you (or former customers) will be disclosed to anyone, except as permitted by law (which includes disclosure to employees necessary to service your account). In the normal course of servicing a customer’s account, the Calvert organization may share information with unaffiliated third parties that perform various required services such as transfer agents, custodians and broker-dealers. |
• | Policies and procedures (including physical, electronic and procedural safeguards) are in place that are designed to protect the confidentiality of such information. |
• | We reserve the right to change our Privacy Policy at any time upon proper notification to you. Customers may want to review our Privacy Policy periodically for changes by accessing the link on our homepage: www.Calvert.com. |
Our pledge of privacy applies to the following entities within the Calvert organization: the Calvert Family of funds and Calvert Research and Management. In addition, our Privacy Policy applies only to those Calvert customers who are individuals and who have a direct relationship with us. If a customer’s account (i.e., fund shares) is held in the name of a third-party financial adviser/broker-dealer, it is likely that only such advisor’s privacy policies apply to the customer. This notice supersedes all previously issued privacy disclosures. For more information about Calvert’s Privacy Policy, please call 1-800-368-2745.
Delivery of Shareholder Documents. The Securities and Exchange Commission (SEC) permits funds to deliver only one copy of shareholder documents, including prospectuses, proxy statements and shareholder reports, to fund investors with multiple accounts at the same residential or post office box address. This practice is often called “householding” and it helps eliminate duplicate mailings to shareholders. Calvert funds, or your financial advisor, may household the mailing of your documents indefinitely unless you instruct Calvert funds, or your financial advisor, otherwise. If you would prefer that your Calvert fund documents not be householded, please contact Calvert funds at 1-800-368-2745, or contact your financial advisor. Your instructions that householding not apply to delivery of your Calvert fund documents will typically be effective within 30 days of receipt by Calvert funds or your financial advisor. Separate statements will be generated for each separate account and will be householded as described above.
Portfolio Holdings. Each Calvert fund will file a schedule of portfolio holdings on Form N-Q with the SEC for the first and third quarters of each fiscal year. The Form N-Q will be available on the Calvert funds’ website at www.calvert.com, by calling Calvert funds at 1-800-368-2745 or in the EDGAR database on the SEC’s website at www.sec.gov. Form N-Q may also be reviewed and copied at the SEC’s public reference room in Washington, D.C. (call 1-800-732-0330 for information on the operation of the public reference room).
Proxy Voting. The Proxy Voting Guidelines that each Calvert fund uses to determine how to vote proxies relating to portfolio securities is provided as an Appendix to the fund’s Statement of Additional Information. The Statement of Additional Information can be obtained free of charge by calling the Calvert funds at 1-800-368-2745, by visiting the Calvert funds’ website at www.calvert.com or visiting the SEC’s website at www.sec.gov. Information regarding how a Calvert fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available by calling Calvert funds, by visiting the Calvert funds’ website at www.calvert.com or by visiting the SEC’s website at www.sec.gov.
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CALVERT EMERGING MARKETS EQUITY FUND | CALVERT’S FAMILY OF FUNDS | |||
Service for Existing Account Shareholders: 800-368-2745 Brokers: 800-368-2746 Regular Mail Calvert Funds c/o BFDS P.O. Box 219544 Kansas City, MO 64121-9544 Overnight Mail Calvert Funds c/o BFDS 330 West 9th Street Kansas City, MO 64105-1514 Web Site calvert.com Principal Underwriter* Eaton Vance Distributors, Inc. Two International Place Boston, MA 02110 | Municipal Funds Tax-Free Responsible Impact Bond Fund Taxable Bond Funds Bond Portfolio Income Fund Short Duration Income Fund Long-Term Income Fund Ultra-Short Income Fund High Yield Bond Fund Green Bond Fund Unconstrained Bond Fund Balanced and Asset Allocation Funds Balanced Portfolio Conservative Allocation Fund Moderate Allocation Fund Aggressive Allocation Fund | Equity Funds Equity Portfolio U.S. Large Cap Core Responsible Index Fund U.S. Large Cap Value Responsible Index Fund U.S. Large Cap Growth Responsible Index Fund U.S. Mid Cap Core Responsible Index Fund Developed Markets Ex-U.S. Responsible Index Fund Capital Accumulation Fund International Equity Fund Small Cap Fund Global Energy Solutions Fund Global Water Fund International Opportunities Fund Emerging Markets Equity Fund |
* FINRA BrokerCheck. Investors may check the background of their Investment Professional by contacting the Financial Industry Regulatory Authority (FINRA). FINRA BrokerCheck is a free tool to help investors check the professional background of current and former FINRA-registered securities firms and brokers. FINRA BrokerCheck is available by calling 1-800-289-9999 and at www.FINRA.org. The FINRA BrokerCheck brochure describing this program is available to investors at www.FINRA.org.
Fund shares are not insured by the FDIC and are not deposits or other obligations of, or guaranteed by, any depository institution. Shares are subject to investment risks, including possible loss of principal invested. This report is intended to provide fund information to shareholders. It is not authorized for distribution to prospective investors unless preceded or accompanied by a prospectus. Note: The information on our website is not incorporated by reference into this report; our website address is included as an inactive textual reference only. Investors should carefully consider the investment objectives, risks, charges and expenses of the Calvert funds. This and other important information is contained in the fund’s summary prospectus and prospectus, which can be obtained from your financial professional and should be read carefully before investing. You may also call Calvert funds at 800-368-2745. Printed on recycled paper. | |
24214 3.31.17 |
Item 2. Code of Ethics.
Not required in this filing.
Item 3. Audit Committee Financial Expert.
Not required in this filing.
Item 4. Principal Accountant Fees and Services.
Not required in this filing.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Schedule of Investments.
Please see schedule of investments contained in the Report to Shareholders included under Item 1 of this Form N-CSR.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
No material changes.
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 Rule 30a-3(c) under the Investment Company Act of 1940 Act, as amended (the “1940 Act”) are effective, based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”), as of a date within 90 days of the filing date of this report.
(b) There was no change in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
Item 12. Exhibits.
(a)(1) Registrant’s Code of Ethics- Not applicable (please see Item 2)
(a)(2)(i) President’s Section 302 certification.
(a)(2)(ii) Treasurer’s Section 302 certification.
(b) Combined Section 906 certification.
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.
Calvert World Values Fund, Inc.
By: /s/ John H. Streur
John H. Streur
President
Date: May 22, 2017
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By: /s/ John H. Streur
John H. Streur
President
Date: May 22, 2017
By: /s/ James F. Kirchner
James F. Kirchner
Treasurer
Date: May 22, 2017