N-CSR 1 tm2317440d1_ncsr.htm N-CSR

 

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 811-03790

 

Pear Tree Funds

(Exact name of registrant as specified in charter)

 

55 Old Bedford Road, Lincoln, MA 01773

(Address of principal executive offices)

 

Willard L. Umphrey

Pear Tree Advisors, Inc.

55 Old Bedford Road, Lincoln, MA 01773

(Name and address of agent for service)

 

Registrant’s telephone number, including area code: (781) 676-5900

 

Date of fiscal year end: March 31
   
Date of reporting period: April 1, 2022 through March 31, 2023

 

 

 

 

ITEM 1(a): REPORTS TO SHAREOWNERS.

 

 

 

[MISSING IMAGE: reportcover19.jpg]
ANNUAL REPORT​
MARCH 31, 2023​
U.S. EQUITY FUNDS​
PEAR TREE POLARIS SMALL CAP FUND​
PEAR TREE QUALITY FUND​
GLOBAL EQUITY FUND​
PEAR TREE ESSEX ENVIRONMENTAL OPPORTUNITIES FUND​
INTERNATIONAL EQUITY FUNDS​
PEAR TREE AXIOM EMERGING MARKETS WORLD EQUITY FUND​
PEAR TREE POLARIS FOREIGN VALUE FUND​
PEAR TREE POLARIS FOREIGN VALUE SMALL CAP FUND​
PEAR TREE POLARIS INTERNATIONAL OPPORTUNITIES FUND
See the inside front cover for important information about access to your fund’s annual and semiannual shareholder reports.

PEAR TREE FUNDS
Important Information About Access to Shareholder Reports
Paper copies of the Pear Tree Funds’ shareholder reports like this one are no longer being sent by mail, unless you specifically request paper copies of the reports from Pear Tree Funds or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already have elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from Pear Tree Funds or your financial intermediary electronically by contacting your financial intermediary or if you invest directly with Pear Tree Funds, by calling 1-800-326-2151 or logging on to www.peartreefunds.com
You may elect to receive all future reports in paper free of charge. You can inform Pear Tree Funds or your financial intermediary that you wish to continue receiving paper copies of your shareholder reports by contacting Pear Tree Funds at 1-800-326-2151 or your financial intermediary. Your election to receive or not receive reports in paper will apply to all funds held with Pear Tree Funds.
Statements Regarding Forward-Looking Information
Pear Tree Funds makes statements in this Annual Shareholders’ Report (this “Shareholders Report”) that are forward-looking statements within the meaning of the federal securities laws. Words, expressions, and statements regarding future periods, such as “believe,” “estimate,” “expect,” “anticipate,” “intend,” “plan,” “seek,” and “may,” are intended to identify forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause any of the Pear Tree Funds’ actual results, performance, or achievements, or industry results, to differ materially from any predictions of future results, performance, or achievements that Pear Tree Funds expresses or implies in this Shareholders Report.
The forward-looking statements included in this Shareholders Report are based upon Pear Tree Funds’ and its investment manager’s and sub-advisers’ current expectations, plans, estimates, assumptions and beliefs that involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions, and future business decisions. Those conditions and decisions are difficult, and sometimes impossible, to predict accurately and many are beyond the control of Pear Tree Funds, its investment manager and its sub-advisers. Although Pear Tree Funds, its investment manager and its sub-advisers believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, each Pear Tree Fund’s actual results and performance could differ materially from those predicted results and performance set forth in the forward-looking statements.
Factors that could have a material adverse effect on a Pear Tree Fund’s operations and future prospects are described in the Pear Tree Funds’ current prospectus.
All forward-looking statements are made as of the date of this Shareholders Report and the risk that actual results will differ materially from the expectations expressed in this Shareholders Report will increase with the passage of time. Except as otherwise required by the federal securities laws, none of Pear Tree Funds, its investment manager or any of its sub-advisers undertakes any obligation to publicly update or revise any forward-looking statements after the date of this Shareholders Report, whether as a result of new information, future events, changed circumstances or any other reason. In light of the significant uncertainties inherent in the forward-looking statements included in this Shareholders Report, the inclusion of such forward-looking statements should not be regarded as a representation by Pear Tree Funds, its investment manager, its sub-advisers or any other person that the objectives and plans set forth in this Shareholders Report will be achieved.

PEAR TREE FUNDS
Pear Tree Polaris Small Cap Fund
Pear Tree Quality Fund
Pear Tree Essex Environmental Opportunities FundPear Tree Axiom Emerging Markets World Equity Fund
Pear Tree Polaris Foreign Value Fund
Pear Tree Polaris Foreign Value Small Cap Fund
Pear Tree Polaris International Opportunities Fund​
ANNUAL REPORT
March 31, 2023​
TABLE OF CONTENTS
1
2
5
5
9
13
17
21
25
29
32
32
36
39
42
48
52
56
62
70
78
92
111
129
131
132
This report must be preceded or accompanied by a current Pear Tree Funds prospectus for individuals who are not current shareholders of the Funds. If you are not a shareholder of a Pear Tree Fund, you should read the prospectus carefully before investing because it contains more complete information on the Pear Tree Funds’ investment objectives, risks, charges and expenses. Please consider this information carefully. For a prospectus and other information, visit www.peartreefunds.com or call 1-800-326-2151.
NOT FDIC INSURED • MAY LOSE VALUE • NO BANK GUARANTEE
Neither Pear Tree Funds nor U.S. Boston Capital Corporation is a bank.

PEAR TREE FUNDS
Dear Fellow Shareholder,
We are pleased to provide you with the Pear Tree Funds’ Annual Report for the fiscal year ended March 31, 2023 and to update you on recent market conditions and the performance of the Pear Tree Funds.
For current performance information, please visit our website at www.peartreefunds.com. We thank you for your continued confidence in the Pear Tree Funds. Please feel free to e-mail us at info@peartreefunds.com or call us at 1-800-326-2151 with any questions or for assistance on your account.
Sincerely,
[MISSING IMAGE: sig_willardumphrey.jpg]
Willard Umphrey
President and Chairman
As used in this report; “Fund” refers to a Pear Tree Fund and “Funds” refers to more than one Pear Tree Fund or all Pear Tree Funds, depending on the context.
Any statements in this report regarding market or economic trends or the factors influencing the historical or future performance of the Pear Tree Funds are the views of the Funds’ investment manager and/or sub-advisers as of the date of this report. These views are subject to change at any time based upon market and other conditions, and Fund management and the subadvisers to the Funds disclaim any responsibility to update such views. These views may not be relied upon as investment advice or as an indication of trading intent on behalf of any Pear Tree Fund. Any references to specific securities are not recommendations to purchase, hold or sell such securities and may not be representative of any Pear Tree Fund’s current or future investments.
Past performance is no guarantee of future results, and there is no guarantee that market forecasts will be realized.
1​

PEAR TREE FUNDS
FUND EXPENSES
We believe it is important for Fund shareholders to have a clear understanding of fund expenses and the impact expenses have on investment returns. The following is important information about each Fund’s Expense Example, which appears on the following page.
Expense Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees, distribution (12b-1) fees (on Ordinary Shares) and other Fund expenses. The example is intended to help you understand your ongoing costs (in dollars) of investing in a Fund and to compare these costs with the ongoing costs of investing in other mutual funds. These examples are based on $1,000 being invested at the beginning of the period and held for the entire period from October 1, 2022 to March 31, 2023.
Actual Expenses
The first line for each Share Class for each Fund in the table on the following page provides information about actual account returns and actual expenses. You may use the information in this line, together with the amount you invested for that Fund and Share Class, to estimate the expenses that you paid over the period. To estimate the expenses you paid over the period, simply divide your account value by $1,000 (e.g., 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” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each Share Class for each Fund in the table on the following page shows you 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 hypothetical expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information only to compare the ongoing expenses of investing in the Fund with the ongoing expenses of other funds. To do so, compare the Fund’s 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.
2

PEAR TREE FUNDS
Expense Example for the 6 months ended March 31, 2023
These examples are based on $1,000 being invested at the beginning of the period and held for the entire period from October 1, 2022 to March 31, 2023.
Pear Tree Fund
Share Class
Total Return
Description
Beginning
Account
Value
10/1/2022
Ending
Account
Value
3/31/2023
Annualized
Expense
Ratio
Expenses Paid
During the
Period*
10/1/2022-
3/31/2023
Small Cap ** Ordinary Actual
$1,000.00
$1,133.40
1.36%
$7.23
Hypothetical
$1,000.00
$1,018.15
1.36%
$6.84
Institutional Actual
$1,000.00
$1,135.70
1.00%
$5.30
Hypothetical
$1,000.00
$1,019.96
1.00%
$5.02
Quality ** Ordinary Actual
$1,000.00
$1,202.00
1.20%
$6.58
Hypothetical
$1,000.00
$1,018.96
1.20%
$6.03
Institutional Actual
$1,000.00
$1,204.70
0.79%
$4.34
Hypothetical
$1,000.00
$1,020.99
0.79%
$3.98
Environmental Ordinary Actual
$1,000.00
$1,067.80
1.22%
$6.30
Opportunities Hypothetical
$1,000.00
$1,018.83
1.22%
$6.15
Institutional Actual
$1,000.00
$1,069.20
0.97%
$4.99
Hypothetical
$1,000.00
$1,020.11
0.97%
$4.87
R6 Actual
$1,000.00
$1,068.20
0.92%
$4.76
Hypothetical
$1,000.00
$1,020.32
0.92%
$4.65
Emerging Markets Ordinary Actual
$1,000.00
$1,114.40
1.58%
$8.34
World Equity Hypothetical
$1,000.00
$1,017.04
1.58%
$7.96
Institutional Actual
$1,000.00
$1,116.80
1.22%
$6.42
Hypothetical
$1,000.00
$1,018.87
1.22%
$6.12
R6 Actual
$1,000.00
$1,118.80
0.98%
$5.16
Hypothetical
$1,000.00
$1,020.06
0.98%
$4.92
Foreign Value Ordinary Actual
$1,000.00
$1,269.80
1.42%
$8.03
Hypothetical
$1,000.00
$1,017.85
1.42%
$7.14
Institutional Actual
$1,000.00
$1,271.80
1.05%
$5.93
Hypothetical
$1,000.00
$1,019.72
1.05%
$5.27
R6 Actual
$1,000.00
$1,273.10
0.94%
$5.31
Hypothetical
$1,000.00
$1,020.26
0.94%
$4.72
Foreign Value Ordinary Actual
$1,000.00
$1,232.00
1.41%
$7.87
Small Cap Hypothetical
$1,000.00
$1,017.88
1.41%
$7.11
Institutional Actual
$1,000.00
$1,234.80
1.04%
$5.82
Hypothetical
$1,000.00
$1,019.72
1.04%
$5.26
R6 Actual
$1,000.00
$1,235.50
1.02%
$5.66
Hypothetical
$1,000.00
$1,019.86
1.02%
$5.12
International Ordinary Actual
$1,000.00
$1,266.40
1.69%
$9.53
Opportunities Hypothetical
$1,000.00
$1,016.52
1.69%
$8.48
Institutional Actual
$1,000.00
$1,267.80
1.35%
$7.63
Hypothetical
$1,000.00
$1,018.20
1.35%
$6.79
R6 Actual
$1,000.00
$1,268.50
1.31%
$7.44
Hypothetical
$1,000.00
$1,018.38
1.31%
$6.62
*Expenses are equal to the Fund’s annualized expense ratio, multiplied by the average account value over the period multiplied by 182/365 (to reflect the one-half year period).
** No Class R6 Shares were outstanding for this Fund during the reporting period.
3​

PEAR TREE FUNDS
4
This page intentionally left blank.

Pear Tree Polaris Small Cap Fund
INVESTMENT PROFILE
Fund Information
Net Assets Under Management
$78.2 Million
Number of Portfolio Holdings 54
Average Price to Book Ratio 1.7
Average Price to Earnings Ratio
12.2
Ordinary
Institutional
Total Expense Ratio (Gross)*
1.50%
1.25%
Total Expense Ratio (Net)*
1.50%
1.13%
Ticker Symbol
USBNX
QBNAX
*
per prospectus dated August 1, 2022. See financial highlights for total expense ratios for the fiscal year ended March 31, 2023. The Fund had no Class R6 Shares outstanding during the period.
All Data as of March 31, 2023
Investment Commentary
(prepared by Polaris Capital Management, LLC, sub-adviser to Pear Tree Polaris Small Cap Fund)
For the fiscal year ended March 31, 2023, Pear Tree Polaris Small Cap Fund’s (the “Fund”) Ordinary Shares outperformed its benchmark, the Russell 2000 Total Return Index (the “Index”). For the period, the Fund achieved a return of (3.39)% at net asset value compared to (11.61)% for the Index.
Market Conditions and Investment Strategies
The Fund had absolute positive returns in the Industrials, Materials, Energy and consumer sectors, offset by losses in Financials, Information Technology (IT) and Health Care. Much, if not all, of the financial sector decline stemmed directly from the SVB/Signature failures and concerns about a broader banking crisis, which hasn’t come to pass to date.
Wabash National Corp. was the single largest contributor to performance, raising prices that more than offset material costs on strong truck trailer demand. Elsewhere in Industrials, Barrett Business Services noted new and existing client wins for their outsourced HR services. Science Applications, the IT service provider to the U.S. government, cited strong organic growth as it was awarded new contracts. Conversely, auto parts supplier Exco Technologies dropped on supply constraints and availability of materials; the stock was sold during the period.
In Materials, Graphic Packaging announced strong 2022 net sales and income, while building capacity with a new recycled paperboard mill. Firm pricing and high demand for cement helped Eagle Materials. Energy had barbell returns with CVR Energy as a big beneficiary of record refining margins. Dril-Quip reported decent earnings in the offshore drilling market, but bookings for subsea products slowed on rising inflation.
Perdoceo Education Corp. and Crocs, Inc. led the Consumer Discretionary sector. Crocs Inc. had impressive double-digit gains on booming international and acquisitive (HEYDUDE) sales. Although enrollment declined at its for-profit universities, Perdoceo protected its profitability; a strong balance sheet should tide over the company until enrollment picks up in a weaker economy.
In Health Care, Pacira Biosciences declined after its flagship non-opioid pain therapy failed to meet sales expectations. Harmony Biosciences suffered on an unsubstantiated short report from Scorpion Capital claiming negative side effects from Harmony’s narcolepsy drug.
Financials detracted most with small regional banks, such as Colony Bankcorp, Cambridge Bancorp, and Brookline Bancorp, under pressure on the bank failure news. Most U.S. banks, including those in this Fund, are on solid footing, having shored up balance sheets and capital ratios after the Great Financial Crisis of 2008. The Fund also exited its positions in struggling Florida insurers.
Portfolio Changes
During the year, the Fund sold more than a dozen stocks, many of which reached the sub-adviser’s valuation targets. Others were exited on concerns about slowing spending on consumer goods and technology. Cash was reallocated to purchase copper miner, Lundin Mining; Exelixis Inc., a biopharmaceutical maker with a successful oncology franchise; print manufacturer Ennis Inc.; Carlisle Companies, a construction materials/roofing company for large industrial complexes; and Janus International, the dominant market player in roll-up doors and security technology for self-storage businesses.
5​

Pear Tree Polaris Small Cap Fund
A Look Ahead
2023 may prove a balancing act between a slowing economy dampening corporate earnings and a moderating interest rate cycle. Added to this equation is the recent U.S. banking crisis, which will manifest in worsening credit conditions for banks and tighter liquidity for consumers and corporates. In either scenario, the Fund is well positioned given the good valuation and quality of portfolio holdings.
Top 10 Holdings
Percentage of total net assets
26.2%
Eagle Materials Inc.
3.0%
Graphic Packaging Holding Co.
3.0%
Barrett Business Services, Inc.
3.0%
South Plains Financial, Inc.
2.6%
Ingredion Incorporated
2.6%
Cabot Corporation
2.5%
NOV Inc.
2.4%
OFG Bancorp
2.4%
Kforce, Inc.
2.4%
Wabash National Corporation
2.3%
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Sector Allocation
Percentage of total net assets
100.0%
Industrials
31.0%
Financials
19.5%
Materials
12.4%
Health Care
9.1%
Energy
8.3%
Information Technology
7.3%
Consumer Discretionary
6.1%
Consumer Staples
2.6%
Communication Services
0.8%
CASH + other assets (net)
2.9%
Value of a $10,000 Investment
Pear Tree Polaris Small Cap. (PTSC) Ordinary Shares vs. Russell 2000 Index*
[MISSING IMAGE: aa6e85tmgs30tl8n7g16bciitjsj.jpg]
*
Polaris took over management of the Fund’s portfolio on 01/01/2015 and modified the Fund’s principal investment strategy. Returns that cover periods prior to that date include performance information of another investment sub-adviser employing a different investment strategy.
 
The Fund’s lead portfolio manager is Bernard R. Horn, Jr., of Polaris Capital Management, LLC.
6

Pear Tree Polaris Small Cap Fund
Average Annual Total Returns
1Q 2023
Six
Months
One Year
Five Year
Ten (3)
Year
Since (3)
Inception
Inception Date
Ordinary Shares
(0.26)%
13.34%
(3.39)%
4.77%
6.30%
8.83%
08/03/1992
Institutional Shares(1)
(0.17)%
13.57%
(3.02)%
5.17%
6.65%
8.49%
01/06/1993
Russell 2000 (2)
2.74%
9.14%
(11.61)%
4.71%
8.04%
8.99%
————————
(1)
Institutional Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution (12b-1) fees.
(2)
The Russell 2000 Index is a market capitalization-weighted index of 2,000 small company stocks. It is widely recognized as representative of the general market for small company stocks. Index returns assume the reinvestment of dividends and, unlike Fund returns, do not reflect any fees or expenses. You cannot invest directly in an Index. For comparative performance purposes, the beginning date of the Index is 08/03/92. The Russell 2000 Index is maintained by FTSE Russell, a subsidiary of the London Stock Exchange Group.
(3)
The current sub-adviser took over management of the Fund’s portfolio on 01/01/2015 and modified the Fund’s principal investment strategy. Returns that cover periods prior to that date include performance information of another investment sub-adviser employing a different investment strategy.
The Fund had no Class R6 Shares outstanding during the reporting period.
Past performance does not predict future performance. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
Small company stocks may trade less frequently and in a limited volume, and their prices may fluctuate more than stocks of other companies. Small company stocks may therefore be more vulnerable to adverse developments than those of larger companies. The Fund may invest in issuers in the real estate industry. Changes in real estate values or economic downturns can have a significant negative effect on these issuers. The Fund may invest in foreign issuers that trade on U.S. stock exchanges. These issuers may be subject to special risks including different corporate governance rules and bankruptcy laws.
The Fund is non-diversified, meaning it may concentrate its assets in fewer individual holdings than a diversified fund. Therefore, the Fund may be more exposed to individual stock volatility than diversified funds. As a result, a decline in the value of the securities of one issuer could have a significant negative effect on the Fund. The Fund may have significant investments in one or more specific industry sectors, subjecting it to risks greater than general market risk. For example, adverse news from just one or two companies in a particular industry can hurt the prices of all stocks in that industry.
7​

Pear Tree Polaris Small Cap Fund
8
This page intentionally left blank.

Pear Tree Quality Fund
INVESTMENT PROFILE
Fund Information
Net Assets Under Management
$187.2 Million
Number of Portfolio Holdings 41
Average Price to Book Ratio 4.4
Average Price to Earnings Ratio
22.8
Ordinary
Institutional
Total Expense Ratio (Gross)*
1.50%
1.25%
Total Expense Ratio (Net)*
1.16%
0.79%
Ticker Symbol
USBOX
QGIAX
*
per prospectus dated August 1, 2022. See financial highlights for total expense ratios for the fiscal year ended March 31, 2023. The Fund had no Class R6 Shares outstanding during the period.
All Data as of March 31, 2023
Investment Commentary
(prepared by Pear Tree Advisors, Inc., the Investment Manager to Pear Tree Quality Fund)
For the fiscal year ended March 31, 2023, Pear Tree Quality Fund’s (the “Fund”) Ordinary Shares outperformed its benchmark, S&P 500 (the “Index”). For the period, the Fund achieved a return of (1.78)% at net asset value compared to (7.73)% for the Index.
Market Conditions and Investment Strategies
The Fund’s investment manager currently chooses securities for the Fund by periodically selecting a mutual fund (the “Target Portfolio”) and monitoring the Target Portfolio’s holdings. The Fund’s investment sub-adviser, at the direction of the investment manager, rebalances the Fund’s portfolio to correspond to the Target Portfolio’s most recent holdings as publicly reported. From April 1, 2022 to March 31, 2023, the Fund’s Ordinary Shares, when compared to the Target Portfolio, had a tracking error of 0.46.
Over the previous twelve months, the Consumer Discretionary sector was the largest positive contributor to the Fund’s performance mainly due to stock selection by the Target Portfolio. Health Care, Communication Services, Consumer Staples, Information Technology and Real Estate sectors selected by the Target Portfolio also contributed to performance.
Energy, Financials, Industrials, Materials and Utilities sector selected by the Target Portfolio detracted from performance. Overall, stock selection and sector selection by the Target Portfolio contributed to performance
Portfolio Changes
We expect the Fund to have a relatively low turnover rate given the historical stability and relatively low turnover rate of the current Target Portfolio.
For the fiscal year ended March 31, 2023, the Fund rebalanced the holdings four times in response to the quarterly holdings report filed by the Target Portfolio. The four rebalances resulted in the sale of four positions. The Fund also opened new positions in two companies: one Health Care Company and one Consumer Discretionary company.
A Look Ahead
The Investment Manager does not expect the Current Target Portfolio to materially change its investment strategy in the foreseeable future. For more information on the selection of the Target Portfolio(s), please see the Fund’s Prospectus.
 
Fund trading execution is overseen by Mark D. Tindall, CFA of Chartwell Investment Partners, LLC
9​

Pear Tree Quality Fund
Top 10 Holdings
Percentage of total net assets
38.4%
Microsoft Corporation
7.5%
UnitedHealth Group, Inc.
4.6%
Apple, Inc.
3.9%
Johnson & Johnson
3.7%
Texas Instruments, Inc.
3.4%
SAP AG
3.2%
Safran SA
3.1%
Coca-Cola Company (The)
3.0%
Oracle Corporation
3.0%
TJX Companies, Inc (The)
3.0%
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Sector Allocation
Percentage of total net assets
100.0%
Information Technology
37.9%
Health Care
24.8%
Consumer Discretionary
10.8%
Consumer Staples
8.0%
Financials
6.3%
Industrials
5.5%
Communication Services
5.1%
Energy
0.0%
Materials
0.0%
Real Estate
0.0%
Utilities
0.0%
Cash + other assets (net)
1.6%
Value of a $10,000 Investment
Pear Tree Quality (PTQ) Ordinary Shares vs. S&P 500 Index
[MISSING IMAGE: okh1ii5s8imala469i4dbdh0sfbe.jpg]
10

Pear Tree Quality Fund
Average Annual Total Returns
1Q 2023
Six
Months
One Year
Five Year
Ten Year
Since (3)
Inception
Inception Date
Ordinary Shares
8.99%
20.20%
(1.78)%
12.82%
12.27%
9.80%
05/06/85
Institutional Shares(1)
9.15%
20.47%
(1.38)%
13.26%
12.64%
9.05%
03/25/91
S & P 500 (2)
7.50%
15.63%
(7.73)%
11.19%
12.24%
10.93%
————————
(1)
Institutional Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution (12b-1) fees.
(2)
The S&P 500 Index is an unmanaged index of stocks chosen for their size and industry characteristics. It is widely recognized as representative of stocks in the United States. Index returns assume the reinvestment of dividends and, unlike Fund returns, do not reflect any fees or expenses. You cannot invest directly in the Index. For comparative performance purposes the beginning date for the Index is 05/29/85. S&P 500 Index is a registered mark of Standard & Poor’s.
(3)
Pear Tree Advisors took over management of the Fund’s portfolio and the Fund changed its strategy on 01/01/2011. The Fund adopted the current Target Portfolio as its target portfolio also on 01/01/2011. Returns that cover periods prior to that date include performance information of other investment sub-advisers pursuing different strategies.
The Fund had no Class R6 Shares outstanding during the reporting period.
Past performance does not predict future performance. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
Securities issued by large-cap companies tend to be less volatile than securities issued by smaller companies. Larger companies, may not be able to attain the high growth rates of successful smaller companies, and may be unable to respond as quickly to competitive challenges.
Investing in foreign 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 than the U.S. market.
The Fund is non-diversified, meaning it may concentrate its assets in fewer individual holdings than a diversified fund. Therefore, the Fund may be more exposed to individual stock volatility than diversified funds. As a result, a decline in the value of the securities of one issuer could have a significant negative effect on the Fund. The Fund may have significant investments in one or more specific industry sectors, subjecting it to risks greater than general market risk. For example, adverse news from just one or two companies in a particular industry can hurt the prices of all stocks in that industry.
Information technology industries can be significantly affected by obsolescence of existing technology, short product cycles, falling prices and profits, competition from new market entrants, and general economic conditions.
Health care industries are subject to government regulation and reimbursement rates, as well as government approval of products and services, which could have a significant effect on price and availability, and can be significantly affected by rapid obsolescence and patent expirations.
11​

Pear Tree Quality Fund
12
This page intentionally left blank.

Pear Tree Essex Environmental Opportunities Fund
INVESTMENT PROFILE
Fund Information
Net Assets $72.8 Million
Number of Companies 34
Price to Book Ratio 5.4
Price to Earnings Ratio 41.7
Ordinary
Institutional
R6
Total Expense Ratio (Gross)*
2.11%
2.30%
2.08%
Total Expense Ratio (Net)*
1.24%
0.99%
0.95%
Ticker Symbol
EEOFX
GEOSX
GEORX
*
per prospectus dated August 1, 2022. See financial highlights for the total expense ratios for the fiscal year ended March 31, 2023.
All Data as of March 31, 2023
Investment Commentary
(prepared by Essex Investment Management Company, LLC., sub-adviser to Pear Tree Essex Environmental Opportunities Fund)
For the fiscal year ended, March 31, 2023, Pear Tree Essex Environmental Opportunities Fund’s (the “Fund”) Ordinary Shares underperformed its benchmark, the MSCI World Index (the “Index”). For the period, the Fund achieved a return of  (14.01)% at net asset value compared to (6.54)% for the Index.
Market Conditions and Investment Strategies
For the fiscal year ended March 31, 2023, the market backdrop was challenging for our style of investing in smaller sized growth companies. Macro concerns, including inflationary pressures, rising interest rates, trade disputes with China, war in Ukraine, bank failures, political polarization and a slowing economy have caused investors to seek the relatively safe haven of stocks of larger companies. Heightened investor trepidation causes shrinking investment horizons and falling valuations of high growth companies. While the Fund trailed its main benchmark, it outperformed the Wilderhill Clean Energy Index (1), which returned (37.60)% over the same trailing one-year period. The Fund’s outperformance versus this more thematic benchmark is due to stock selection. The three biggest contributors to Fund performance over the past year were SMA Solar Technologies AG (a German manufacturer of solar inverters), SunOpta Inc. (a manufacturer of organic foods and non-dairy milk products) and Nibe Industrier AB (a Swedish manufacturer of heat pumps). Our largest detractors were Aspen Aerogels (a manufacturer of high efficiency insulation products used in industrial products and electric vehicles), Kornit Digital Ltd. (a manufacturer of digital printers used in the textile industry), and Generac Holdings (a manufacturer of backup generators and related energy storage products).
Portfolio Changes
Our trading activity is often targeted at the underlying volatility in our portfolio companies -- trim when they advance too much and add when they fall too much. Given the weakening economy and difficult financing environment, we sold companies with weaker balance sheets such as Sunnova and Sunrun. Other sales included solar inverter manufacturer SMA Solar Technologies AG and energy software provider PSI Software AG. New purchases included wind energy related companies Vestas and TPI Composites, battery company Enovix and water company Zurn Elkay Water Solutions.
A Look Ahead
We are constructive on the outlook for the Fund. The fundamental underpinnings for clean technology stocks are strengthening: technology advances continue to drive down costs and customer demand continues to rise. In addition to helping to solve for our world’s environmental problems, our portfolio companies produce products and services that slow inflationary pressure and reduce business risk for their customers. While the demand case continues to strengthen, the relative valuations of our portfolio companies are as inexpensive as we can recall.
(1) The Wilderhill Clean Energy Index is composed of stocks of companies that are publicly traded in the United States and engaged in the business of advancement of cleaner energy and conservation.
13​

Pear Tree Essex Environmental Opportunities Fund
Top 10 Holdings
Percentage of total net assets
39.2%
Infineon Technologies AG
4.8%
Energy Recovery, Inc.
4.6%
Landis+Gyr Group AG
4.6%
Badger Meter, Inc.
4.4%
Cognex Corporation
3.7%
NIBE Industrier AB
3.6%
SolarEdge Technologies, Inc.
3.5%
TPI Composites, Inc.
3.4%
Hubbell Incorporated
3.3%
Vestas Wind Systems A/S
3.3%
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Sector Allocation
Percentage of total net assets
100.0%
Industrials
48.4%
Information Technology
31.0%
Materials
7.2%
Consumer Staples
2.8%
Utilities
2.5%
Consumer Discretionary
2.1%
CASH + other assets (net)
6.0%
Top 10 Country Allocations
Percentage of total net assets
94.0%
United States
58.0%
Denmark
6.8%
Israel
5.9%
Japan
5.3%
Ireland
5.1%
Germany
4.8%
Switzerland
4.5%
Sweden
3.6%
Value of a $10,000 Investment
Pear Tree Essex Environmental Opportunities (EEOFX) Ordinary Shares vs.MSCI World Index*
[MISSING IMAGE: ojfdk76ppq92kgia4ibia32t321e.jpg]
*
Performance for periods prior to September 1, 2021 represents the performance of Essex Environmental Opportunities Fund, the predecessor fund of the Fund
14

Pear Tree Essex Environmental Opportunities Fund
Average Annual Total Returns*
1Q 2023
Six
Months
One Year
Five Year
Ten Year
Since
Inception
Inception Date
Ordinary Shares
5.80%
6.78%
(14.01)%
8.35%
-%
7.55%
09/01/2017
Institutional Shares(1)
5.87%
6.92%
(13.78)%
8.63%
-%
7.81%
09/01/2017
R6 Shares (1)
5.93%
6.82%
(13.80)%
-%
-%
(17.89)%
09/01/2021
MSCI World (2)
7.88%
18.54%
(6.54)%
8.57%
-%
8.85%
————————
*
Performance for periods prior to September 1, 2021 represents the performance of Essex Environmental Opportunities Fund, the predecessor fund of the Fund.
(1)
Institutional Shares and R6 Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution (12b-1) fees.
(2)
The MSCI World Index captures large and mid-cap representation across 23 Developed Markets(DM) countries. With 1,509 constituents as of 3/31/2023, the index covers approximately 85% of the free float-adjusted market capitalization in each country. You cannot invest directly in an index. For comparative performance purposes, the beginning date of the Index is 09/01/2017. The MSCI World Index is maintained by MSCI Inc.
Past performance does not predict future performance. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
Securities issued by large-cap companies tend to be less volatile than securities issued by smaller companies. Larger companies, may not be able to attain the high growth rates of successful smaller companies, and may be unable to respond as quickly to competitive challenges.
Investing in foreign 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 than the U.S. market.
Information technology industries can be significantly affected by obsolescence of existing technology, short product cycles, falling prices and profits, competition from new market entrants, and general economic conditions.
Industrial industries can be significantly affected by general economic trends, changes in consumer sentiment and spending, commodity prices, legislation, government regulation and spending, import controls, worldwide competition, and liability for environmental damage, depletion of resources, and mandated expenditures for safety and pollution control.
15​

Pear Tree Essex Environmental Opportunities Fund
16
This page intentionally left blank.

Pear Tree Axiom Emerging Markets World Equity Fund
INVESTMENT PROFILE
Fund Information
Net Assets Under Management
$70.1 Million
Number of Portfolio Holdings 106
Average Price to Book Ratio 3.0
Average Price to Earnings Ratio
18.1
Ordinary
Institutional
R6
Total Expense Ratio (Gross)*
1.65%
1.40%
1.25%
Total Expense Ratio (Net)*
1.43%
1.06%
1.00%
Ticker Symbol
QFFOX
QEMAX
QFFRX
*
per prospectus dated August 1, 2022. See financial highlights for the total expense ratios for the fiscal year ended March 31, 2023.
All Data as of March 31, 2023
Investment Commentary
(prepared by Axiom Investors LLC, sub-adviser to Pear Tree Axiom Emerging Markets World Equity Fund)
For the fiscal year ended March 31, 2023, Pear Tree Axiom Emerging Markets World Equity Fund’s (the “Fund”) Ordinary Shares underperformed its benchmark, MSCI EM Index (the “Index”). For the period, the Fund achieved a return of (16.41)% at net asset value compared to (10.30)% for the Index.
Market Conditions and Investment Strategies
The Fund’s dynamic growth stocks faced strong headwinds in 2022, with growth significantly underperforming value globally as central banks undertook the most aggressive tightening cycle since the early 1980’s. In the first quarter of 2023, growth stock premiums began rebounding from 2022’s sell-down as the outlook for developed market GDP growth and inflation continued to moderate.
Stock selection within Financials and Industrials detracted from relative returns for the period. Communication Services was the best relative performing sector. China was the worst relative performing market due to online retailers, who saw declining market share over the period. A Latin American e-commerce company was the standout performer resulting from an improving competitive landscape in its key Brazilian market and a more rational pricing environment in 2023. Indonesia was the best relative performing market due to strong performance from banks.
Portfolio Changes
The Fund reduced positions in sectors with higher cyclicality, particularly the Information Technology sector, due to a combination of wage-related input cost pressure, and as 2022’s growing economic uncertainty created risk to future revenue growth. The Fund also reduced exposure to semiconductors, as early period falling demand for many consumer electronic products was causing a corresponding fall in demand for chips that go into these devices.
The Fund increased exposure to Consumer Discretionary companies in China that should benefit from the easing of Covid-driven mobility restrictions that began at the end of 2022. One of the largest sector reductions was in Financials. Much of this change in positioning came within China amid concerns related to contagion fears spreading from the Chinese Real Estate sector to Financials.
A Look Ahead
The sub-adviser continues to be optimistic on the outlook for emerging markets (EM) into 2023. EM GDP is anticipated to accelerate to 3.9% in 2023 from 3.1% in 2022. The gap between emerging and developed growth, which compressed to under one percentage point in 2021 and 2022, is expected to increase to 3.5% in 2023 - the widest gap in ten years – as EM growth accelerates and developed market (DM) growth decelerates. This magnitude of growth gap has historically been a catalyst for EM outperformance. Other tailwinds for the EM asset class include near decade-low foreign ownership of EM equities, lower inflationary pressure than DM, and one standard deviation cheap relative valuation vs. US markets.
 
The Fund’s lead portfolio manager is Andrew Jacobson of Axiom International Investors LLC.
17​

Pear Tree Axiom Emerging Markets World Equity Fund
Top 10 Holdings
Percentage of total net assets
36.5%
Taiwan Semiconductor Manufacturing Co., Ltd.
8.8%
Tencent Holdings Limited
5.1%
Samsung Electronics Company Limited
5.0%
Baidu, Inc.
2.9%
Ping An Insurance Group H Share
2.5%
Mercado Libre, Inc.
2.5%
iShares Core MSCI Emerging Markets ETF
2.5%
Trip.com Group Limited
2.5%
HDFC Bank Ltd.
2.4%
Alibaba Group Holding Ltd.
2.3%
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Sector Allocation
Percentage of total net assets
100.0%
Information Technology
23.2%
Financials
18.7%
Consumer Discretionary
16.9%
Communication Services
9.6%
Consumer Staples
8.3%
Industrials
8.2%
Health Care
5.3%
Real Estate
2.3%
Materials
2.2%
Energy
1.8%
Mutual Funds
2.5%
CASH + other assets (net)
1.0%
Top 10 Country Allocations
Percentage of total net assets
83.4%
China
26.8%
Taiwan
13.0%
India
10.5%
South Korea
9.7%
Mexico
5.8%
United States
5.5%
Indonesia
3.8%
Brazil
3.0%
Thailand
3.0%
Hong Kong
2.3%
Value of a $10,000 Investment
Pear Tree Axiom Emerging Markets World Equity
(PTEM) Ordinary Shares vs. MSCI EM Index*
[MISSING IMAGE: a7vu45s4h81somef7v47vamffc5k.jpg]
*
Axiom took over the management of the Fund’s portfolio and the Fund changed its investment strategy on 01/01/2019. Returns that cover periods prior to that date include performance information of other investment sub-advisers pursuing different strategies.
18

Pear Tree Axiom Emerging Markets World Equity Fund
Average Annual Total Returns
1Q 2023
Six
Months
One Year
Five Year
(3)
Ten Year
(3)
Since
Inception
(3)
Inception Date
Ordinary Shares
5.67%
11.44%
(16.41)%
(0.69)%
0.28%
4.27%
09/30/1994
Institutional Shares(1)
5.82%
11.68%
(16.06)%
(0.31)%
0.61%
5.42%
04/02/1996
R6 Shares (1)
5.93%
11.88%
(15.85)%
-%
-%
2.86%
01/28/2019
MSCI EM (2)
4.02%
14.20%
(10.30)%
(0.53)%
2.37%
4.56%
————————
(1)
Institutional Shares and R6 Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution (12b-1) fees.
(2)
The MSCI Emerging Markets (“MSCI EM”) Index is an unmanaged index composed of stocks located in countries other than the United States. It is widely recognized as representative of the general market for emerging markets. Index returns assume the reinvestment of dividends and, unlike Fund returns, do not reflect fees or expenses. You cannot invest directly in an Index. For comparative performance purposes, the beginning date for the Index is 09/30/94. The MSCI EM Index is maintained by MSCI Inc.
(3)
Axiom took over the management of the Fund’s portfolio and the Fund changed its investment strategy on 01/01/2019. Returns that cover periods prior to that date include performance information of other investment sub-advisers pursuing different strategies.
Past performance does not predict future performance. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
Investing in 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 other economic developments and can perform differently than the U.S. market.
Information technology industries can be significantly affected by obsolescence of existing technology, short product cycles, falling prices and profits, competition from new market entrants, and general economic conditions.
Securities issued by Chinese and Hong Kong companies share many risk characteristics of emerging markets securities. In addition, China’s legal system is undeveloped, and Hong Kong has experienced political tensions since it ceased to be a British colony. The rules that govern public companies in China and Hong Kong, are significantly different from the U.S.’s, have from time to time been applied arbitrarily by local regulators, and require of issuers significantly less transparency.
 
19​

Pear Tree Axiom Emerging Markets World Equity Fund
20
This page intentionally left blank.

Pear Tree Polaris Foreign Value Fund
INVESTMENT PROFILE
Fund Information
Net Assets Under Management
$3,175.9 Million
Number of Portfolio Holdings 58
Average Price to Book Ratio 1.5
Average Price to Earnings Ratio
11.4
Ordinary
Institutional
R6
Total Expense Ratio (Gross)*
1.50%
1.26%
1.10%
Total Expense Ratio (Net)*
1.40%
1.04%
0.94%
Ticker Symbol
QFVOX
QFVIX
QFVRX
*
per prospectus dated August 1, 2022. See financial highlights for the total expense ratios for the fiscal year ended March 31, 2023.
All Data as of March 31, 2023
Investment Commentary
(prepared by Polaris Capital Management, LLC, subadviser to Pear Tree Polaris Foreign Value Fund)
For the fiscal year ended March 31, 2023, Pear Tree Polaris Foreign Value Fund’s (the “Fund”) Ordinary Shares underperformed its benchmark, the MSCI EAFE Index (the “Index”). For the period, the Fund had a return of (5.10)% at net asset value compared to (0.86)% for the Index.
Market Conditions and Investment Strategies
During the fiscal year, international equity markets were awash in volatility on the back of: high inflation and ensuing interest rate hikes; lingering effects from the pandemic; supply chain disruptions; a European energy crisis wrought from the Russia-Ukraine conflict; SVB/Signature bank failures; and ongoing concerns about economic growth. Top detracting sectors included Financials, Materials and Information Technology. On the bright side, the Fund posted absolute positive returns in Industrials and Communication Services. Strong results were recorded in France and Sweden, as well as double-digit gains from single stock holdings in Taiwan, Netherlands and Greece. Portfolio stocks in Canada, Norway and South Korea detracted most.
Among Industrials, Swedish bearing and seal manufacturer SKF AB reported solid industrial and auto sector (especially EV) demand. French company VINCI SA, which runs roads and airport concessions, upgraded guidance on double-digit sales and solid operating performance.
In Communication Services, French advertising company Publicis released robust full-year earnings, with organic growth in its Epsilon and Sapient divisions. Acquisitive growth was also on display with Publicis’ acquisition of Practia. Deutsche Telekom added to its customer base in Germany, while its T-Mobile division usurped market share from AT&T and other U.S. providers. LG Uplus was a notable sector laggard, facing greater competition and regulatory hurdles on rate plans.
Volatility in commodity prices hurt copper miner Lundin Mining, as well as methanol producer, Methanex Corp. Lundin dropped further on news of a sinkhole near its Candelaria mine and other operational issues early in the year; by the end of March 2023, the stock started to recover. Lundin will acquire a majority stake in the Caserones Copper Mine, adding to its capacity as copper supply-demand (due to EV needs) favors the few industry suppliers.
Financials hampered performance. flatexDEGIRO AG, the German online discount brokerage firm, cut it’s revenue forecast; the company was also subject to new regulatory and audit requirements following the review of BaFin. Puerto Rican bank, Popular Inc., declined on cancellation of its buyback program, increased technology spending, certain income losses and investor concern over its securities portfolio. Nearly 40% of Toronto-Dominion Bank business is in the U.S.; TD suffered along with its U.S.-based counterparts, reeling from the March 2023 bank failures.
Portfolio Changes
During the fiscal year, more than a dozen portfolio companies were sold, most of which were exited on valuation or a change in market conditions. Some, like Svenska Handelsbank and Infosys, were sold in favor of more defensive plays. Capital was redeployed to purchase two Consumer Staples companies, Nomad Foods and Koninklijke Ahold Delhaize; paper packaging supplier Smurfit Kappa Group; enterprise software company OpenText Corp.; and Canadian Tire, one of the largest diversified merchandisers in Canada.
21​

Pear Tree Polaris Foreign Value Fund
A Look Ahead
Although inflation is moderating, central banks will maintain restrictive monetary policies, albeit at smaller increments, for the foreseeable future. A slowdown is likely, the speed and gravity of which is still in question considering the resiliency of markets. A balancing act between these competing macro trends will induce continued market volatility. This bodes well for our portfolio, as we are able to identify and purchase fundamentally strong companies at attractive prices.
Top 10 Holdings
Percentage of total net assets
25.2%
Weichai Power Company Limited
3.0%
Marubeni Corporation
2.7%
Publicis Groupe
2.7%
Deutsche Telekom AG
2.5%
Methanex Corporation
2.5%
Vinci SA
2.5%
Sony Group Corporation
2.4%
Koninklijke Ahold Delhaize
2.3%
Muenchener Rueckversicherungs-Gesellschaft
2.3%
Linde plc
2.3%
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio.
Sector Allocation
Percentage of total net assets
100.0%
Consumer Discretionary
23.1%
Financials
17.9%
Materials
16.3%
Industrials
12.0%
Communication Services
10.6%
Information Technology
6.4%
Health Care
4.2%
Consumer Staples
3.5%
Real Estate
1.8%
Cash and Other Assets (Net)
4.2%
Top 10 Country Allocations
Percentage of total net assets
82.3%
United Kingdom
12.5%
South Korea
12.3%
Japan
12.1%
Canada
11.0%
France
8.9%
Germany
7.3%
Norway
6.3%
Ireland
4.8%
Sweden
4.1%
China
3.0%
Value of a $10,000 Investment
Pear Tree Polaris Foreign Value (PTFV) Ordinary Shares vs. MSCI EAFE Index
[MISSING IMAGE: a0gsrphqulnbs3o4167ksuql2gsm.jpg]
The Fund’s lead portfolio manager is Bernard R. Horn, Jr., of Polaris Capital Management, LLC
22

Pear Tree Polaris Foreign Value Fund
Average Annual Total Returns
1Q 2023
Six
Months
One Year
Five Year
Ten Year
Since
Inception
Inception Date
Ordinary Shares
7.99%
26.98%
(5.10)%
0.75%
4.15%
5.58%
05/15/1998
Institutional Shares(1)
8.09%
27.18%
(4.74)%
1.13%
4.48%
6.74%
12/18/1998
R6 Shares (1)
8.14%
27.31%
(4.58)%
1.21%
%
3.84%
02/06/2017
MSCI EAFE (2)
8.62%
27.52%
(0.86)%
4.03%
5.50%
4.72%
————————
(1)
Institutional Shares and R6 Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution (12b-1) fees.
(2)
The MSCI Europe, Australia, and Far East (“MSCI EAFE”) Index is an unmanaged index comprised of stocks in countries other than the United States. It is widely recognized as representative of the general market for developed foreign markets. Index returns assume the reinvestment of dividends and, unlike Fund returns, do not reflect any fees or expenses. You cannot invest directly in an Index. For comparative performance purposes, the beginning date for the Index is 05/29/98. The MSCI EAFE Index is maintained by MSCI Inc.
Past performance does not predict future performance. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
Investing in 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 other economic developments and can perform differently than the U.S. market.
The Fund is non-diversified, meaning it may concentrate its assets in fewer individual holdings than a diversified fund. Therefore, the Fund is more exposed to individual stock volatility than diversified funds. As a result, a decline in the value of the securities of one issuer could have a significant negative effect on the Fund. The Fund may have significant investments in one or more specific industry sectors, subjecting it to risks greater than general market risk. For example, adverse news from just one or two companies in a particular industry can hurt the prices of all stocks in that industry.
23​

Pear Tree Polaris Foreign Value Fund
24
This page intentionally left blank.

Pear Tree Polaris Foreign Value Small Cap Fund
INVESTMENT PROFILE
Fund Information
Net Assets Under Management
$1,000.6 Million
Number of Portfolio Holdings 64
Average Price to Book Ratio 1.3
Average Price to Earnings Ratio
10.7
Ordinary
Institutional
R6
Total Expense Ratio (Gross)*
1.51%
1.26%
1.12%
Total Expense Ratio (Net)*
1.41%
1.04%
1.02%
Ticker Symbol
QUSOX
QUSIX
QUSRX
*
per prospectus dated August 1, 2022. See financial highlights for the total expense ratios for the fiscal year ended March 31, 2023.
All Data as of March 31, 2023
Investment Commentary
(prepared by Polaris Capital Management, LLC, subadviser to Pear Tree Polaris Foreign Value Small Cap Fund)
For the fiscal year ended March 31, 2023, Pear Tree Polaris Foreign Value Small Cap Fund’s (the “Fund”) Ordinary Shares outperformed its benchmark, the MSCI ACWI ex USA Small Cap Index (the “Index”). For the period, the Fund had a return of (5.95)% at net asset value compared to (9.91)% for the Index.
Market Conditions and Investment Strategies
Outperformance was due to absolute gains in Industrials and Consumer Discretionary, where the Fund was overweight. Detractors included Information Technology (IT), Consumer Staples and Financials. At the country level, the portfolio had notable results in France, Japan and Sweden; decliners included Norwegian banks, Taiwan tech companies and Irish food suppliers.
Post-pandemic travel/work reopening drove demand at Elis SA, the French laundry service. The company resumed hotel/office services, while maintaining its defensive volumes. Elsewhere in Industrials, Tecnoglass Inc. had impressive organic growth, concentrating on U.S. lucrative geographies; a strong supply chain helped capture business from competitors.
In the Consumer Discretionary sector, D’Ieteren Group hired a new CEO for Belron, their global glass repair business. The CEO has a long tenure integrating M&A activities, which will be a boon for Belron as it continues its acquisitive growth initiatives. Jumbo, the Greek toy company, had impressive earnings with sales up due to brick-and-mortar expansion into other countries.
Technip Energies, a French energy engineering company, had solid momentum in its New Energy order book, partnering with Baker Hughes and Shell on energy construction that lower emissions. The company also landed sizeable project management/engineering awards with Middle East oil companies.
Several IT stocks were impacted by industry-wide weakness, including AEM Holdings, Tripod Technology and Elite Material, the latter of which was also penalized for a COVID-induced plant shutdown in Shanghai. In consumer staples, Greencore Group, Nomad Foods and C&C Group dropped on higher input costs and eroding consumer confidence in Europe.
Canada’s goeasy was down when the federal government capped the annual interest rate on loans at 35% from the previously allowable 47%. The company still expects earnings growth even with this new policy. Loan loss provisions at Nordic banks are set to climb in 2023, as macro-economic challenges (rising interest rates) weigh on commercial real estate exposure. The Fund’s Norwegian banks fell on this expectation.
Portfolio Changes
We strategically repositioned the Fund, adding more defensive companies and reducing weightings in economically sensitive sectors and geographies. The Fund exited a dozen stocks, with capital reallocated to new purchases including: Future PLC, a U.K. publishing company; Open House Group, a Japanese affordable single-family home developer; CIE Automotive, the Spanish auto components manufacturer; the aforementioned Technip Energies NV; German discount brokerage firm, flatexDEGIRO; and France-based Rubis, which distributes petroleum and LPG products in the Caribbean and North Africa.
25​

Pear Tree Polaris Foreign Value Small Cap Fund
A Look Ahead
The torrid pace of inflation has slowed from late 2022 as supply bottlenecks and energy prices declined. Nevertheless, central banks will continue their tightening monetary policies, albeit at smaller increments, for the foreseeable future, alluding to tight labor markets, low unemployment and nominal wage growth. A slowdown is inevitable, the speed and gravity of which is still in question considering the remarkably resilient markets. Recent travels have identified a number of attractively priced small cap stocks effectively weathering volatile conditions, ripe for growth in a market recovery.
Top 10 Holdings
Percentage of total net assets
27.0%
Elis S.A.
3.2%
Technip Energies N.V.
3.1%
Tecnoglass, Inc.
2.8%
D’Ieteren S.A.
2.8%
Hexpol AB
2.8%
Equatorial Energia S.A.
2.6%
Sanwa Holdings Corporation
2.5%
Thanachart Capital PCL
2.5%
Loomis AB, Class B
2.4%
Glanbia plc
2.3%
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio
Sector Allocation
Percentage of total net assets
100.0%
Industrials
23.1%
Financials
19.2%
Consumer Discretionary
18.4%
Information Technology
8.1%
Consumer Staples
7.9%
Materials
7.6%
Utilities
6.7%
Energy
3.1%
Communications Services
1.9%
Real Estate
1.3%
CASH + other assets (net)
2.7%
Top 10 Country Allocations
Percentage of total net assets
73.2%
Japan
16.7%
United Kingdom
14.9%
France
8.5%
Sweden
6.4%
Ireland
5.5%
Thailand
4.8%
Taiwan
4.7%
Norway
4.1%
Singapore
3.8%
Denmark
3.8%
Value of a $10,000 Investment
Pear Tree Polaris Foreign Value Small Cap (PTFVSC) Ordinary Shares vs. MSCI ACWI ex USA Small Cap Index
[MISSING IMAGE: ash4anc68r5cq0l53oaltc8bhggv.jpg]
 
The Fund’s lead portfolio manager is Bernard R. Horn, Jr., of Polaris Capital Management, LLC
26

Pear Tree Polaris Foreign Value Small Cap Fund
Average Annual Total Returns
1Q 2023
Six
Months
One Year
Five Year
Ten Year
Since
Inception
Inception Date
Ordinary Shares
7.00%
23.20%
(5.95)%
1.50%
5.76%
5.57%
05/01/2008
Institutional Shares(1)
7.16%
23.48%
(5.65)%
1.87%
6.10%
5.87%
05/01/2008
R6 Shares (1)
7.14%
23.55%
(5.59)%
1.91%
%
5.32%
02/06/2017
MSCI ACWI ex USA Small Cap(2)
4.81%
18.85%
(9.91)%
2.10%
5.47%
4.47%
(1)
Institutional Shares and R6 Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution (12b-1) fees.
(2)
The MSCI ACWI ex USA Small Cap Index captures small cap representation across 22 of 23 Developed Markets (DM) countries (excluding the United States). With 4,358 constituents as of 3/31/2023, the index covers approximately 14% of the global equity opportunity set outside the US. You cannot invest directly in an index. For comparative performance purposes, the beginning date of the Index is 05/01/08. The MSCI ACWI ex USA Small Cap Index is maintained by MSCI Inc.
Past performance does not predict future performance. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
Investing in 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 other economic developments and can perform differently than the U.S. market.
The Fund is non-diversified, meaning it may concentrate its assets in fewer individual holdings than a diversified fund. Therefore, the Fund is more exposed to individual stock volatility than diversified funds. As a result, a decline in the value of the securities of one issuer could have a significant negative effect on the Fund. The Fund may have significant investments in one or more specific industry sectors, subjecting it to risks greater than general market risk. For example, adverse news from just one or two companies in a particular industry can hurt the prices of all stocks in that industry.
Small company stocks may trade less frequently and in a limited volume, and their prices may fluctuate more than stocks of other companies. Small company stocks may therefore be more vulnerable to adverse developments than those of larger companies.
27​

Pear Tree Polaris Foreign Value Small Cap Fund
28
This page intentionally left blank.

Pear Tree Polaris International Opportunities Fund
INVESTMENT PROFILE
Fund Information
Net Assets Under Management
$28.1 Million
Number of Portfolio Holdings 70
Average Price to Book Ratio 2.5
Average Price to Earnings Ratio
14.4
Ordinary
Institutional
R6
Total Expense Ratio (Gross)*
1.63%
1.34%
1.29%
Total Expense Ratio (Net)*
1.63%
1.22%
1.29%
Ticker Symbol
QISOX
QISIX
QISRX
*
per prospectus dated August 1, 2022. See financial highlights for the total expense ratios for the fiscal year ended March 31, 2023.
All Data as of March 31, 2023
Investment Commentary
(prepared by Polaris Capital Management LLC, subadviser to Pear Tree Polaris International Opportunities Fund)
For the fiscal year ended March 31, 2023, Pear Tree Polaris International Opportunities Fund’s Ordinary Shares (the “Fund”) underperformed its benchmark, the MSCI ACWI ex USA Index (the “Index”). For the period, the Fund achieved a return of  (6.69)% at net asset value compared to (4.57)% for the Index.
Market Conditions and Investment Strategies
The Fund had absolute positive performance in Industrials, Materials and both consumer sectors, offset by notable declines in Financials and Information Technology (IT). At the country level, holdings in France, Italy, Japan, Mexico and Sweden boosted results, as did single stocks in Greece, Belgium, Spain and Singapore. The U.K.’s economic scheme met with skittish investors and a currency depreciation; most U.K. stocks fell on the news. Holdings in Taiwan also underwhelmed.
Industrial sector gains were led by JAC Recruitment Co., the Japanese staffing firm, which recorded impressive earnings in its domestic recruitment division. Mexican airport holdings recovered strongly as vacation travel resumed to local hotspots.
Jumbo SA, the Greek retailer of baby/children products, led the Consumer Discretionary sector. Among other sector stocks posting double-digit gains, Australia’s footwear company, Accent Group, noted resilient purchasing power among its young consumer base. Games Workshop Group announced a contract with Amazon to develop TV and film content based on their Warhammer 40k intellectual property. Conversely, Collins Foods reported lower profits because of higher cost headwinds in Australia and Europe.
SOL Group, the Italian industrial gases supplier, was the single largest contributor for the period, announcing robust full year 2022 results. In Consumer Staples, Canada’s Alimentation Couche-Tard Inc. posted strong net earnings, increasing merchandise and service revenues and good fuel margins on successful cost controls.
Financials detracted most. Muangthai Capital lost ground as the Thailand motorcycle financing company saw consumer loan originations slow. Canada’s goeasy was down when the federal government capped the annual interest rate on loans at 35% from the previously allowable 47%. FirstRand was down on a weakening South African economy. Among IT companies, Elite Material Co. was hurt by a weakening demand for electronic devices and a COVID-induced plant shutdown in Shanghai. Other IT decliners included Tripod Technology Corp., Know IT AB and Hansen Technologies.
Portfolio Changes
During the period, the Fund exited nearly a dozen stocks, most of which were sold as they reached Polaris’ upper valuation limits. Capital was reallocated to new buys including Future PLC, a U.K. publishing company; Singapore commercial bank, United Overseas; U.K. concrete landscape manufacturer, Marshalls PLC; British foodservice company, SSP Group; DFDS, the world’s largest ferry operator; SOL SpA, an Italian industrial gas/medical service company; and Fullcast Holdings, a temporary staffing firm out of Japan. A number of banks were also added to the portfolio, as were five new Consumer Discretionary stocks.
29​

Pear Tree Polaris International Opportunities Fund
A Look Ahead
Markets have remained remarkably resilient in the face of rising interest rates, recent banking crises and energy price/output concerns in Europe. The pace of inflation is finally moderating, but central banks will likely continue tightening monetary supply until other metrics (unemployment, labor, consumption) are within an acceptable range. In this context, we expect demand to be challenging in coming quarters. Market volatility bodes well for the Fund, as we are able to add attractively priced companies with the potential to outperform in an economic recovery.
Top 10 Holdings
Percentage of total net assets
21.5%
D’Ieteren S.A.
2.8%
Alimentation Couche-Tard Inc.
2.4%
United Overseas Bank Limited
2.3%
Bravida Holding AB
2.1%
Neurones S.A.
2.1%
Zhejiang Supor Co.
2.0%
TISCO Financial Group
2.0%
Toronto-Dominion Bank
2.0%
SOL SpA
1.9%
Accent Group Limited
1.9%
There is no guarantee that such securities will continue to be viewed favorably or held in the Fund’s portfolio
Sector Allocation
Percentage of total net assets
100.0%
Consumer Discretionary
27.3%
Financials
24.2%
Information Technology
16.3%
Industrials
15.4%
Materials
8.8%
Consumer Staples
3.9%
Utilities
1.6%
Communication Services
1.2%
CASH + other assets (net)
1.3%
Top 10 Country Allocations
Percentage of total net assets
68.3%
Canada
10.8%
United Kingdom
9.6%
Japan
8.0%
China
7.0%
Taiwan
6.7%
France
6.6%
Australia
5.9%
Sweden
5.4%
Italy
4.7%
Mexico
3.6%
Value of a $10,000 Investment
Pear Tree Polaris International Opportunities Fund (QISOX) Ordinary Shares vs. MSCI ACWI ex USA Index
[MISSING IMAGE: bfhi10e712jn2s3thpq3bvtfrmvr.jpg]
30

Pear Tree Polaris International Opportunities Fund
Average Annual Total Returns
1Q 2023
Six
Months
One Year
Five Year
Ten Year
Since
Inception
Inception Date
Ordinary Shares
9.06%
26.64%
(6.69)%
%
%
7.28%
01/30/2019
Institutional Shares(1)
9.05%
26.78%
(6.32)%
%
%
7.71%
01/30/2019
R6 Shares (1)
9.06%
26.85%
(6.30)%
%
%
7.71%
01/30/2019
MSCI ACWI ex USA(2)
7.00%
22.38%
(4.57)%
%
%
5.18%
———————
(1)
Institutional Shares and R6 Shares may only be purchased by certain categories of investors and are not subject to sales charges or distribution (12b-1) fees.
(2)
The MSCI ACWI ex USA Index captures large and mid-cap representation across 22 of 23 Developed Markets (DM) countries (excluding the United States) and 24 Emerging Markets (EM) countries. With 2,262 constituents as of 3/31/2023, the index covers approximately 85% of the global equity opportunity set outside the United States. You cannot invest directly in an index. For comparative performance purposes, the beginning date of the Index is 01/30/2019. The MSCI ACWI ex USA Index is maintained by MSCI Inc.
Past performance does not predict future performance. The graph and the table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares.
Investing in 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 other economic developments and can perform differently than the U.S. market.
The Fund is non-diversified, meaning it may concentrate its assets in fewer individual holdings than a diversified fund. Therefore, the Fund is more exposed to individual stock volatility than diversified funds. As a result, a decline in the value of the securities of one issuer could have a significant negative effect on the Fund. The Fund may have significant investments in one or more specific industry sectors, subjecting it to risks greater than general market risk. For example, adverse news from just one or two companies in a particular industry can hurt the prices of all stocks in that industry.
Small company stocks may trade less frequently and in a limited volume, and their prices may fluctuate more than stocks of other companies. Small company stocks may therefore be more vulnerable to adverse developments than those of larger companies.
31​

Pear Tree Polaris Small Cap Fund
SCHEDULE OF INVESTMENTS
March 31, 2023
COMMON STOCK — 97.1%
Shares
Value
AEROSPACE & DEFENSE — 4.0%
Curtiss-Wright Corporation
10,400
$
1,833,104
V2X, Inc. (a)
33,100
1,314,732
3,147,836
AUTO COMPONENTS — 2.0%
Standard Motor Products, Inc.
42,600
1,572,366
AUTOMOBILES — 0.9%
Winnebago Industries, Inc.
12,567
725,116
BANKS — 14.6%
BOK Financial Corporation
8,464