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Wasatch Frontier Emerging Small Countries Strategy

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Wasatch Frontier Emerging Small Countries Strategy
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Strategy Overview

Highlights
  • Seeks the highest-quality companies in frontier and emerging small countries
  • Truly active, collaborative, bottom-up, fundamental process
  • Systematic coverage of the frontier emerging small country universe
  • Risk controlled through extensive fundamental due diligence
Investment Approach

We use a bottom-up approach that seeks to identify companies with outstanding long-term growth potential. We look for companies with:

  • Strong financials
  • A sustainable competitive advantage
  • Industry-best management teams
  • Earnings growth greater than the relevant sector or industry

Approximately 30-70 positions

Portfolio Managers
Scott Thomas Scott Thomas Lead Portfolio Manager
7 years on strategy
12 years at wasatch

We travel throughout frontier and emerging markets to find less well known, long-duration growth companies. We’re often told how rare it is to actually get a visit from potential investors.”

—Scott Thomas, Lead Portfolio Manager

Performance

Total Returns AS OF 03/31/24 AS OF 04/30/24
Quarter-End Month-end
1 Month
3 Month
ytd
1 yr
3 yr
5 yr
10 yr
Since
Inception
Frontier Emerging Small Countries Composite (Gross)
-1.07%
5.30%
5.01%
21.99%
-3.93%
6.07%
2.94%
7.03%
Frontier Emerging Small Countries Composite (Net)
-1.19%
5.00%
4.59%
20.59%
-5.47%
4.12%
1.19%
5.19%
MSCI Frontier Emerging Markets Index
-3.11%
0.88%
2.30%
10.58%
0.59%
-0.27%
-0.44%
2.08%
MSCI Frontier Markets Index
-2.98%
1.10%
2.11%
10.00%
-2.27%
2.36%
0.92%
4.41%

Returns for periods greater than one year are annualized. Since inception performance is calculated from 01/31/2012.

Calendar Year Returns (%) NET OF FEES (AS OF 12/31/23)
Frontier Emerging Small Countries Composite
MSCI Frontier Emerging Markets Index
MSCI Frontier Markets Index

Performance is preliminary and subject to change. Past performance is not indicative of future results. Wasatch Global Investors is an independent registered investment advisor. Registration does not imply a certain level of skill or training. Wasatch claims compliance with the Global Investment Performance Standards (GIPS®). GIPS® is a registered trademark of CFA Institute. CFA Institute does not endorse or promote this organization, nor does it warrant the accuracy or quality of content contained herein. To receive a complete list and description of composites and pooled funds and/or a GIPS Composite Report, e-mail inforequest@wasatchglobal.com. The U.S. Dollar is the currency used to express performance.

The Frontier Emerging Small Countries Composite contains fully discretionary equity accounts following the Frontier Emerging Small Countries style.  The composite primarily invests in the equity securities of all market capitalizations that are tied economically to frontier markets and small emerging market countries with the goal of long-term growth of capital.  For comparison purposes the composite is measured against the MSCI Frontier Emerging Markets Net TR and MSCI FM (Frontier Markets) Net TR indices.

The MSCI Frontier Markets and Frontier Emerging Markets Net TR Indexes are free float-adjusted market capitalization indexes that are designed to measure equity market performance in the global frontier and emerging markets.

The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis should not be taken as an indication or guarantee of any future performance analysis, forecast or prediction. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the “MSCI Parties”) expressly disclaims all warranties (including, without limitation, any warranties or originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages. (www. msci.com). Indexes are unmanaged, and investors cannot invest directly in an index.

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Portfolio

Characteristics AS OF 03/31/24
Portfolio
Index
Number of Holdings
35
232
Average Market Cap
($ Weighted)
$21.98B
$10.56B
Median Market Cap
$5.96B
$920M
EPS Growth (%, est. 5 yr)
25
7
P/E (Forward)
19
10
Portfolio Turnover (%)
30.53
N/A
Active Share (%)
97
N/A
Performance Statistics AS OF 03/31/24
5 yr
Alpha
7.35
Beta
1.05
R-Squared
0.74
Standard Deviation
22.92
Upside Capture
135.45
Downside Capture
95.28
Top 10 Holdings AS OF 03/31/24
Company
% of Net Assets
FPT Corp. (Vietnam)
10.1%
Bajaj Finance Ltd. (India)
8.4%
Qualitas Controladora SAB de CV (Mexico)
8.0%
NU Holdings Ltd. (Brazil)
7.9%
MercadoLibre Inc.
7.5%
Bank for Foreign Trade of Vietnam JSC (Vietnam)
5.5%
DCVFMVN Diamond ETF (Vietnam)
4.3%
Globant SA
3.5%
Cholamandalam Investment and Finance Co Ltd. (India)
3.4%
Baltic Classifieds Group PLC (United Kingdom)
3.3%
35 Number of holdings
97% Active share
Sector Allocation AS OF 03/31/24
Sector
Portfolio
Index
Financials
51.5 %
39.5 %
Information Technology
17.7 %
0.3 %
Consumer Discretionary
8.7 %
2.0 %
Industrials
6.9 %
12.7 %
Consumer Staples
5.1 %
6.1 %
Communication Services
4.9 %
4.7 %
Energy
2.3 %
5.0 %
Cash & Cash Equivalents*
1.6 %
N/A
Health Care
1.3 %
3.2 %
Materials
0.0 %
10.9 %
Real Estate
0.0 %
10.5 %
Utilities
0.0 %
5.2 %
Country Allocation AS OF 03/31/24
Portfolio (%)
Developed
20.9%
United States
13.0%
United Kingdom
6.1%
Singapore
1.6%
Sweden
0.2%
Emerging & Frontier
77.6%
Vietnam
19.9%
Mexico
12.3%
India
11.8%
Brazil
11.6%
Saudi Arabia
6.1%
Malaysia
3.4%
Philippines
2.6%
Other
9.9%
20.9% Developed
77.6% Em and Frontier

Country weights are calculated as a percentage of total portfolio including cash & cash equivalents.

Commentary & Literature

Important Disclosures

Past performance does not guarantee future results. Performance results are net of transaction costs and reflect the reinvestment of dividend and other earnings. Net performance data was calculated using actual management fees. Actual fees may vary depending on, among other things, the applicable fee schedule and portfolio size. See Wasatch Global Investors Form ADV Part 2A for more information on fee schedules. Some portfolio net-of fees returns may be net of performance-based fees. Current performance may be lower or higher than the performance data quoted.

Portfolio holdings are subject to change. References to individual companies should not be construed as recommendations to buy or sell shares in those companies. Wasatch analysts closely monitor the companies held in the portfolio. If a company’s underlying fundamentals or valuation measures change, Wasatch will reevaluate its position and my sell part or all of its holdings.

Portfolio Characteristics, Allocations and Top Ten Holdings are derived from a representative account. A representative account is selected based on accounts with substantially similar investment policies, objectives, and strategies that closely resemble, or are most representative of, the strategy it represents.

Est. 5-year EPS Growth %: Estimated percentage increase in earnings per share (EPS) per year of the fund's holdings over the next 5 years. Returns are not guaranteed and may be higher or lower. Source: Wasatch and FactSet. P/E Ratio (forward and trailing): Sum of stock prices of the fund's holdings divided by the aggregate earnings per share of those holdings for the next 12 months (forward), or past 12 months (trailing), calculated as a weighted harmonic average. P/E to Growth Rate: Forward 12-month P/E ratio divided by the estimated 5-year EPS growth rate. Portfolios with a number less than 1.0 would be considered undervalued, around 1.0 would be considered fair valued and significantly greater than 1.0 would be considered overvalued. Weighted Average Market Cap: Average market capitalization of companies held by the fund, weighted by their percentage of fund net assets. Portfolio Turnover: A measure of trading activity in a fund's portfolio over the past 12 months expressed as a percentage of the fund's average total assets. Alpha measures a fund's risk/reward potential. A positive alpha means the fund outperformed the index. A negative alpha means the fund underperformed the index. Beta measures a fund's risk in relation to the market. A beta of 0.8 means the fund's total return is likely to move up or down 80% of the market change; 1.25 means total return is likely to move up or down 25% more than the market. R-Squared measures (from 0 to 1.0) how closely a fund's movements are correlated with movements of its benchmark. An R-squared of 1.0 would mean that the fund's movements are completely correlated with the movements of its benchmark. Active Share measures the difference between portfolio holdings and the benchmark. It is the sum of the absolute values of the different weightings of each holding in the fund versus each holding in the benchmark, divided by 2. Standard Deviation measures the degree to which a fund's performance has varied from its average performance over a particular time period. The greater the standard deviation, the greater a fund's volatility (risk). Upside Capture explains how well a fund performs in time periods where the benchmark's returns are greater than zero. Downside Capture explains how well a fund performs in time periods where the benchmark's returns are less than zero.

Wasatch Advisors LP, trading as Wasatch Global Investors ARBN 605 031 909, is regulated by the U.S. Securities and Exchange Commission under U.S. laws which differ from Australian laws. Wasatch Global Investors is exempt from the requirement to hold an Australian financial services licence in accordance with class order 03/1100 in respect of the provision of financial services to wholesale clients in Australia.

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