Pear Tree Polaris Small Cap Fund

The PEAR TREE POLARIS SMALL CAP FUND provides investors with the opportunity to participate in the growth potential of domestic small cap companies. A small cap company will generally be a company with a market capitalization from $250 million to $5 billion.

Investment Process

The Fund generally invests in domestic stocks with a market cap of up to $5 billion at the time of purchase. 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 industry.

Buy and Sell Discipline

The Fund uses proprietary models to rank publicly traded small cap companies on the basis of value and to narrow the universe down to 200 to 400 for further consideration. The Fund supplements the screening process by performing in-depth financial and fundamental analysis. Risk controls are also employed to prevent the Fund from concentrating its investments in any particular industry sector.

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 35 years of investment experience to the Fund.

Fund Overview

YTD RETURN*
-1.17%

NAV*
$26.25

INCEPTION
August 3, 1992

MINIMUM INVESTMENT
$2,500

CUSIP
70472Q401

BENCHMARK
Russell 2000

NET EXPENSE RATIO(1)
1.50%

GROSS EXPENSE RATIO(2)
1.50%

 

*as of 11/25/2022

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 11/25/2022
Quarterly
As Of 9/30/2022
1 Year
As Of 9/30/2022
3 Years
As Of 9/30/2022
5 Years
As Of 9/30/2022
10 Years
As Of 9/30/2022
Since Inception As Of
9/30/2022
Total Gross Expense Ratio(1) Total Net Expense Ratio(2)
-1.17% -4.81% -12.04% 2.86% 2.35% 6.14% 8.53% 1.50% 1.50%

Calendar Year

2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011
24.23% -4.78% 23.50% -10.88% 6.42% 20.88% -1.48% -6.81% 40.21% 13.39% -4.53%

Portfolio

as of September 30, 2022

Top Ten Holdings

Percentage Of Total Net Assets 26.70
South Plains Financial, Inc. 3.50%
Barrett Business Services, Inc. 3.10%
OFG Bancorp 2.80%
Cambridge Bancorp 2.70%
Graphic Packaging Holding Co. 2.60%
International Bancshares Corporation 2.60%
BOK Financial Corporation 2.50%
NOV Inc. 2.40%
Science Applications International Corporation 2.30%
Wabash National Corporation 2.20%

Sector Weightings

Percentage Of Total Net Assets 100.0%
Industrials 26.30%
Financials 23.00%
Information Technology 11.60%
Materials 10.10%
Energy 7.60%
Consumer Discretionary 7.60%
Health Care 6.50%
Consumer Staples 2.80%
Communication Services 2.00%
CASH + other assets (net) 2.50%

Top Ten Country Allocations

Percentage Of Total Net Assets 100.00%
United States 88.30%
Puerto Rico 4.70%
Canada 4.50%
CASH + other assets (net) 2.50%

Portfolio Characteristics

Net Assets $69,292,172
Number Of Holdings 59
Percentage in Top 10 Holdings 26.7
Weighted Average Market Cap (Mil) $2,963.27
Annual Turnover 23.00%

Portfolio Allocation

Percentage of Portfolio 100.0%
Equity Securities 97.50%
Cash and Other Assets (Net) 2.50%

For the Quarter ended September 30, 2022

The Pear Tree Polaris Small Cap Fund’s Ordinary Shares (the “Fund”) underperformed its benchmark, the Russell 2000 Total Return Index (the “Index”). The Fund had a return of (4.81%) at net asset value compared to (2.19%) for the Index.

Market Conditions and Investment Strategies

The Fund’s Information Technology (“IT”), Materials and Energy holdings detracted most from performance, while Industrials and
Financials had relatively strong performance vs. the benchmark.

Among Industrials, Wabash National had robust earnings, as they were able to raise prices to cover raw material costs due to
strong demand for their truck trailers. The company went on to announce upbeat year-end guidance. Barrett Business Services
saw continued strong demand from existing business and new client wins for their outsourced HR services.

In Consumer Discretionary, Crocs had double-digit gains, capitalizing on 1) the expected reduction in Chinese tariffs, 2) cheaper
ocean shipping rates, and 3) HeyDude’s productive distribution channels. Winnebago reported record fiscal third quarter results,
gaining market share while positioning their business for a tougher operating environment. Sector returns were hampered
by Standard Motor Products, as the company missed earnings expectations and reported margin compression on higher raw
material costs.

South Plains Financial was the largest contributor to Fund performance, with BOK Financial and International Bancshares
Corp. rounding out the top 10. South Plains continued to its upward trajectory, reporting 20% commercial loan growth across
diversified industries. Many of the banks in the Fund saw meaningful net interest margin expansion as rates ticked higher and
credit losses remained benign.

Dril-Quip Inc. reported improving quarterly earnings, with higher revenues in the offshore drilling market. However, bookings for
subsea products slowed as end customers delayed projects until inflation moderates; the stock dropped on this news. Cinemark
declined after competitor, Cineworld, filed for Chapter 11. A light movie slate also impacted ticket sales. Evertec, the Puerto
Rican electronic transaction company, declined after renegotiating its business and shareholder relationship with Popular, Inc.

Portfolio Changes

The Fund sold Natus Medical, which was taken private by ArchiMed in an all-cash offer; healthy gains were realized on the sale.
A reseller of technology products, Insight Enterprises, had booming business during COVID as people built home offices. The
stock was sold at a profit this quarter; the timing was fortuitous as a looming recession will likely curtail IT and tech purchases.
Spending trends were also the impetus for the sale of Superior Group of Cos, as discretionary spending on corporate promotional
and branded products may retract. The Fund purchased Ennis Inc., a wholesale print manufacturer that provides forms, labels,
tags, envelopes and more. A defensive play, Ennis has a stable customer base, strong acquisitive growth strategy, conservative
balance sheet and competitive material sourcing advantages.

Outlook

The expected economic downturn has materialized, with most U.S. markets entering bear market territory year-to-date. The
Fund’s benchmark, the Russell 2000, was down 25%, while the S&P 500 declined more than 23%. We pre-empted a similar
fate, with keen portfolio positioning into more defensive holdings throughout the year; as a result, we beat the benchmark by
more than 800 basis points YTD. We continue to execute on our portfolio strategy, as volatility presents opportunity to purchase
attractively priced stocks that improve the valuation and quality profile of the Fund.

Distributions

Dividend Short-Term Capital Gain Long-Term Capital Gain
2021 $0.1543 $0.6423 $1.4143
2020 $0.1568 $0.0000 $0.0000
2019 $0.1357 $0.0000 $1.8027

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.

Axiom International Investors began subadvising the Pear Tree Axiom Emerging Markets World Equity Fund December 8, 2018.

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, 2023.

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 Axiom Emerging Markets World Equity
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.