Pear Tree Polaris Foreign Value Small Cap Fund
The PEAR TREE POLARIS FOREIGN VALUE SMALL CAP FUND provides investors with the opportunity to participate in the growth potential of small cap companies located in foreign countries. A small cap company will generally be a company with a market capitalization from $50 million to $5 billion.
Investment Process
The Fund will generally own 50 to 100 stocks of non-U.S. companies located in Europe, Australia and the Far East. In addition, the Fund may also invest in companies located in emerging markets. The diversification within the Fund, coupled with the fact that the operation of the Fund’s investment model will generally lead the Fund to be invested in 15 or more foreign markets, reduces the likelihood that negative performance of a single country will significantly impact the Fund's return.
Buy and Sell Discipline
The investment process for the Fund combines both quantitative and fundamental techniques. The Fund's approach is primarily “bottom up,” searching for individual stocks with strong, undervalued cash flows, regardless of location or industry. The Fund uses proprietary models to rank countries and industries on the basis of value and to narrow a universe of over 30,000 companies down to 400 to 600 for further consideration. The Fund supplements the screening process by performing in-depth financial and fundamental analysis.
Portfolio Management
The Fund is managed by Polaris Capital Management, LLC, a Boston, Massachusetts money manager that specializes in the management of global, international, and domestic equity portfolios. Polaris brings over 40 years of investment experience to the Fund.
Fund Overview
YTD RETURN*
12.22%
NAV*
$16.80
INCEPTION
May 1, 2008
MINIMUM INVESTMENT
$2,500
CUSIP
70472Q609
BENCHMARK
MSCI ACWI ex. US SMALL CAP
NET EXPENSE RATIO(1)
1.42%
GROSS EXPENSE RATIO(2)
1.52%
*as of 5/5/2025
Investment Professionals
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Sub-Advisor
Polaris Capital Management, LLC
Polaris is a leading global value equity manager, serving the investment needs of institutions and individuals since 1995. At Polaris Capital Management, we have a disciplined approach to investing in undervalued companies around the world, regardless of country, industry or market capitalization.
Portfolio Managers
Bernard R. Horn, Jr.
Sumanta Biswas, CFA
Bin Xiao, CFA
Jason Crawshaw
Performance
| YTD As Of 5/5/2025 |
Quarterly As Of 3/31/2025 |
1 Year As Of 3/31/2025 |
3 Years As Of 3/31/2025 |
5 Years As Of 3/31/2025 |
10 Years As Of 3/31/2025 |
Since Inception As Of 3/31/2025 |
Total Gross Expense Ratio(1) | Total Net Expense Ratio(2) |
|---|---|---|---|---|---|---|---|---|
| 12.22% | 4.88% | 0.72% | 2.84% | 12.49% | 4.52% | 5.80% | 1.52% | 1.42% |
Calendar Year
| 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 |
|---|---|---|---|---|---|---|---|---|---|---|
| -2.31% | 20.78% | -17.60% | 15.11% | 6.36% | 20.24% | -19.09% | 33.06% | 2.46% | -1.49% | 6.54% |
Portfolio
as of March 31, 2025
Top Ten Holdings
| Percentage Of Total Net Assets | 28.50% |
|---|---|
| EQB Inc. | 3.30% |
| Tecnoglass, Inc. | 3.10% |
| Computacenter plc | 3.00% |
| Equatorial Energia S.A. | 2.90% |
| D'Ieteren S.A. | 2.90% |
| Thanachart Capital PCL | 2.90% |
| Sixt SE | 2.70% |
| TISCO Financial Group | 2.70% |
| Sanyang Motor Co., Ltd. | 2.50% |
| QinetiQ | 2.50% |
Sector Weightings
| Percentage Of Total Net Assets | 100.00% |
|---|---|
| Financials | 25.10% |
| Industrials | 22.60% |
| Consumer Discretionary | 17.00% |
| Information Technology | 9.30% |
| Materials | 8.00% |
| Utilities | 7.20% |
| Consumer Staples | 3.00% |
| Health Care | 2.00% |
| Energy | 1.20% |
| Communication Services | 1.10% |
| Real Estate | 0.50% |
| CASH + other assets (net) | 3.00% |
Top Ten Country Allocations
| Percentage Of Total Net Assets | 71.10% |
|---|---|
| United Kingdom | 13.10% |
| Japan | 12.90% |
| France | 11.50% |
| Norway | 6.80% |
| Thailand | 5.60% |
| Canada | 5.60% |
| South Korea | 4.30% |
| Germany | 4.00% |
| Sweden | 3.70% |
| Taiwan | 3.60% |
Portfolio Characteristics
| Net Assets | $776,281,021 |
|---|---|
| Number Of Holdings | 59 |
| Percentage in Top 10 Holdings | 28.50% |
| Weighted Average Market Cap (Mil) | $3,405.36 |
| Annual Turnover | 21.00% |
Portfolio Allocation
| Percentage of Portfolio | 100.00% |
|---|---|
| Equity Securities | 97.00% |
| Cash and Other Assets (Net) | 3.00% |
Commentary
For the Quarter ended March 31, 2025
The Pear Tree Polaris Foreign Value Small Cap Fund’s Ordinary Shares (the “Fund”) outperformed its benchmark, the MSCI ACWI ex USA Small Cap Index (the “Index”). The Fund had a return of 4.88% at net asset value compared to 0.76% for the Index.
Market Conditions and Investment Strategies
Outperformance was attributable to strong gains in overweight sectors including Financials, Utilities and Industrials, along with other benchmark-beating results in Utilities, Energy, Health Care and Consumer Discretionary sectors. Consumer Staples was a notable detractor. At the country level, the Fund benefitted from holdings in France, Norway, Japan, South Korea and Brazil to name a few. Canada, Colombia and Ireland detracted, the latter on the back of Glanbia PLC.
The Trump Administration halted climate policy requirements for U.S. companies; however, European customers still want such policies in place, and are taking their business elsewhere. This helped Financials like Amundi, which typically compete with U.S. peers. Amundi had strong quarter results, with more assets under management and net inflows. Norwegian banks also had healthy gains, with Sparebank 1 SMN and Sparebank 1 Sor Norge each up more than 20%. German discount brokerage flatexDEGIRO posted better-than-expected earnings, while announcing ambitious plans to grow its user base and offer more products. GoEasy LTD had strong underlying earnings and return-on-equity targets, but declined on Canadian regulations that
lowered the interest rate cap on loans.
Double-digit gains from Sankyu Inc, Loomis AB, Elis SA and Doosan Bobcat boosted Industrials sector returns, slightly offset by losses at Tecnoglass and Aalberts NV. Swedish cash handling company, Loomis, cited good organic growth and margins, coupled with strong free cash flow. Doosan Bobcat posted better-than-expected quarterly results, subsequently announcing a share buyback. Tecnoglass reported record results in 2024. However, the architectural glass firm is at the whim of construction volumes, which may be impacted by higher-for-longer interest rates and tariffs. Similarly, Aalberts is exposed to sluggish European construction markets; the firm’s other business lines have underwhelmed.
Among other individual top performers, Equatorial Energia met with success, adapting to changing Brazilian government policies by expanding into renewable energy generation and selling its transmission assets to reinvest in core businesses. British IT firm, Computacenter, beat earnings expectations and boasts a strong order book especially in the North American market.
The largest detractor was Irish nutritional company Glanbia PLC, which issued a profit warning in mid-February. Two issues were at play: 1) Glanbia products faced competition from Costco private labels and 2) its weight-management SlimFast business declined as new GLP-1 drugs gained in popularity.
Portfolio Changes
We exited DFDS AS when a new competitor entered the market likely to impede DFDS’ profitable Turkey ferry transport business. ENF Technology, the South Korea semiconductor chemical manufacturer, was sold due to a weak product lineup. Sale proceeds bolstered a few defensive names in the Fund portfolio.
Outlook
Tariff negotiations have taken center stage, whipsawing global security markets. What was supposed to be a boon for the U.S. economy has proven the inverse: international markets have outperformed so far in 2025. We have seen strong results throughout much of Europe as well as select Asian and South American countries. In that vein, we are continuing to diversify the portfolio to tap into some of the fastest growing economies.
Distributions
| Dividend | Short-Term Capital Gain | Long-Term Capital Gain | |
|---|---|---|---|
| 2024 | $0.3708 | $0.0000 | $0.0000 |
| 2023 | $0.3280 | $0.0000 | $0.0000 |
| 2022 | $0.5771 | $0.0000 | $0.0000 |
Performance data quoted represents past performance and is no guarantee of future results. Current performance may be lower or higher than performance data quoted. Investment return and principal value will fluctuate so that an investor's shares, when redeemed, may be worth more or less than original cost.
Before investing, carefully consider the Fund's investment objectives, risks, charges and expenses. For this and other information obtain the Fund's prospectus or, if available, the Fund's summary prospectus by calling (800) 326-2151 or by clicking the Literature and Forms section of this website to view or download a prospectus or, if available, a summary prospectus. Please read the prospectus carefully before you invest or send money.
1, 3, 5, and 10Yr performance numbers quoted are average annual total returns. Performance numbers quoted under one year are cumulative.
Polaris Capital began subadvising the Pear Tree Small Cap Fund on January 1, 2015.
The Pear Tree Essex Environment Opportunities Fund (the “Fund”) is the successor to the investment performance of the Essex Environmental Opportunities Fund (“Predecessor Fund”) as a result of the reorganization of the Predecessor Fund into the Environmental Opportunities Fund on September 1, 2021. Performance information shown prior to the close of business on August 31, 2021 is that of the Predecessor Fund’s for the Fund’s Ordinary Shares and Institutional Shares.
Expense Ratios Disclosure
1. Expense Ratio (Gross)
The gross expense ratio is the total operating expense from the class of shares of the fund stated as a percent of the fund's total net assets as disclosed in the fund’s most recent prospectus before waivers or reimbursements.
2. Expense Ratio (Net)
Net Expense Ratio is the total annual operating expense from the class of shares of the funds stated as a percent of the fund's total net assets as disclosed in the fund’s most recent prospectus after any fee waiver and/or expense reimbursements that will reduce any fund operating expenses until July 31, 2025 for all funds except, Polaris International Opportunities Institutional and R6, Polaris Small Cap Institutional and R6 and Quality R6. For these fund classes the fee waiver and/or expense reimbursements that will reduce any fund operating expenses will be in effect until October 31, 2025.
Risk Disclosure
Pear Tree Polaris Foreign Value
Pear Tree Polaris Foreign Value Small Cap
Pear Tree Polaris International Opportunities
Pear Tree Polaris Small Cap
Pear Tree Essex Environmental Opportunities
Foreign and Emerging Market Risk. Foreign markets, particularly emerging markets, can be more volatile than the U.S. market due to increased risks of adverse issuer, political, regulatory, market, or economic developments and can perform differently from the U.S. market. Emerging markets can be subject to greater social, economic, regulatory, and political uncertainties and can be extremely volatile.
Small Cap Investing. The value of securities of smaller, less well-known issuers can perform differently from the market as a whole and other types of stocks and can be more volatile than that of larger issuers.