N-CSR 1 d601297dncsr.htm EATON VANCE MUTUAL FUNDS TRUST Eaton Vance Mutual Funds Trust

 

 

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: 811-04015

 

 

Eaton Vance Mutual Funds Trust

(Exact Name of Registrant as Specified in Charter)

 

 

Two International Place, Boston, Massachusetts 02110

(Address of Principal Executive Offices)

 

 

Deidre E. Walsh

Two International Place, Boston, Massachusetts 02110

(Name and Address of Agent for Services)

 

 

(617) 482-8260

(Registrant’s Telephone Number)

October 31

Date of Fiscal Year End

October 31, 2022

Date of Reporting Period

 

 

 


Item 1.

Reports to Stockholders

 



Eaton Vance
Emerging Markets Local Income Fund
Annual Report
October 31, 2022



Commodity Futures Trading Commission Registration. The Commodity Futures Trading Commission (“CFTC”) has adopted regulations that subject registered investment companies and advisers to regulation by the CFTC if a fund invests more than a prescribed level of its assets in certain CFTC-regulated instruments (including futures, certain options and swap agreements) or markets itself as providing investment exposure to such instruments. The adviser is registered with the CFTC as a commodity pool operator with respect to its management of the Fund. As the commodity pool operator of the Fund, the adviser has claimed relief under the Commodity Exchange Act from certain reporting and recordkeeping requirements. The adviser is also registered as a commodity trading advisor.
Fund shares are not insured by the FDIC and are not deposits or other obligations of, or guaranteed by, any depository institution. Shares are subject to investment risks, including possible loss of principal invested.
This report must be preceded or accompanied by a current summary prospectus or prospectus. Before investing, investors should consider carefully the investment objective, risks, and charges and expenses of a mutual fund. This and other important information is contained in the summary prospectus and prospectus, which can be obtained from a financial intermediary. Prospective investors should read the prospectus carefully before investing. For further information, please call 1-800-262-1122.




Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Management’s Discussion of Fund Performance

Economic and Market Conditions
The world’s equity and fixed-income markets posted broad losses during the 12-month period ended October 31, 2022. The declines were due to several factors, including high inflation in many countries, aggressive monetary tightening by the U.S. Federal Reserve (the Fed), and slowing global economic growth.
During the period, U.S. inflation surged as strong consumer demand following the relaxation of COVID-19 restrictions coincided with supply shortages created by the pandemic. Production and trade disruptions resulting from Russia’s February 2022 invasion of Ukraine added to inflationary pressures by driving up prices of energy and grains. The Fed responded by increasing short-term interest rates at the fastest pace in decades and signaling that it would continue hiking rates until inflation was under control -- even if it meant pushing the U.S. economy into recession.
The European Central Bank and Bank of England also raised interest rates during the period in efforts to tame inflation, despite signs of deterioration in the European economy. Conversely, the Bank of Japan held its main policy rate at −0.1%. Inflation rose in Japan during the period but remained low compared to inflation in other developed countries. The widening differential between interest rates in Japan and the U.S. contributed to a substantial weakening in the Japanese yen versus the U.S. dollar during the period.
In China, government policies helped contain inflation but also significantly slowed economic growth. First, China maintained its zero-COVID policy, which led to lockdowns of major cities during the period. Second, Chinese leaders renewed their focus on the country’s “common prosperity” agenda, implementing measures that negatively affected certain sectors of China’s economy, including real estate and technology.
During the period, a number of emerging and frontier nations either defaulted on their sovereign debt or were pushed to the brink of default. Rising food and energy prices pressured these governments to offer subsidies to consumers, putting additional stress on fiscal balances already strained by pandemic-related spending. In addition, broad strength in the U.S. dollar made servicing U.S. dollar-denominated debt more expensive.
On a positive note, we believe there were signs late in the period that inflation may have peaked in several major emerging-market economies. Central banks in these countries indicated that they were at, or near, the end of their tightening cycles.
Fund Performance
For the 12-month period ended October 31, 2022, Eaton Vance Emerging Markets Local Income Fund (the Fund) returned -20.47% for Class A shares at net asset value (NAV), underperforming its benchmark, the J.P. Morgan Government Bond Index: Emerging Markets (JPM GBI-EM) Global Diversified (Unhedged) (the Index), which returned -20.27%.
The Fund’s interest rate exposures had the largest negative impact on performance relative to the Index during the period, and positioning in sovereign credit also detracted. On the plus side, currency exposure was the top contributor to relative performance, and corporate credit exposure added value as well.
On a regional basis, relative returns in Eastern European positions were negatively affected by an out-of-Index position in Ukrainian local bonds. This investment performed poorly due to the Russia-Ukraine war, which led to a steep sell-off in Ukrainian local assets. The unfavorable impact of this exposure was partly offset by underweight positions in local interest rates in Russia, Poland, and Hungary, as interest rates increased and bond prices declined in these three nations during the period. By period-end, the local interest rate position in Russia was sold from the Fund.
In Asia, an out-of-Index position in South Korean local interest rates hurt relative performance given the global trend of rising rates during the period. Conversely, a lack of exposure to the Chinese yuan was helpful amid the slowdown in China’s economy.
In Latin America, overweight exposure to Colombian interest rates detracted from returns versus the Index, while an overweight position in Brazilian rates was a notable contributor. Inflation in Brazil moderated during the period, prompting the country’s central bank to pause its rate-hiking campaign.
In the Middle East & Africa, the Fund’s lack of exposure to Egypt late in the period was a major contributor to performance relative to the Index. During this time, the Egyptian pound fell sharply, pressured by the Egyptian government’s decision to adopt a more flexible exchange-rate system to help secure a loan from the International Monetary Fund.
The Fund used derivatives extensively to both hedge select undesired risk exposures as well as gain select desired risk exposures. Some of the above commentary about notable drivers of performance at the country level involved the use of derivatives. The Fund’s use of derivatives broadly detracted from returns versus the Index during the period. In particular, interest rate swaps, which are used both to gain and hedge desired exposures, detracted from Fund performance versus the Index. Currency forwards, which are also used both to gain and hedge desired exposures and are the other major derivative type used by the Fund, further detracted from relative performance during the period.
See Endnotes and Additional Disclosures in this report.
Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value (NAV) or offering price (as applicable) with all distributions reinvested. Furthermore, returns do not reflect the deduction of taxes that shareholders may have to pay on Fund distributions or upon the redemption of Fund shares. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance for periods less than or equal to one year is cumulative. Performance is for the stated time period only; due to market volatility, current Fund performance may be lower or higher than the quoted return. For performance as of the most recent month-end, please refer to eatonvance.com.
2


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Performance

Portfolio Manager(s) John R. Baur, Brian Shaw, CFA and Patrick Campbell, CFA
% Average Annual Total Returns1,2 Class
Inception Date
Performance
Inception Date
One Year Five Years Ten Years
Class A at NAV 06/27/2007 06/27/2007 (20.47)% (2.35)% (1.26)%
Class A with 3.25% Maximum Sales Charge (22.98) (2.99) (1.58)
Class C at NAV 08/03/2010 06/27/2007 (21.31) (3.08) (1.81)
Class C with 1% Maximum Deferred Sales Charge (22.01) (3.08) (1.81)
Class I at NAV 11/30/2009 06/27/2007 (20.48) (2.12) (1.00)

J.P. Morgan Government Bond Index: Emerging Markets (JPM GBI-EM) Global Diversified (Unhedged) (20.27)% (3.54)% (2.56)%
% Total Annual Operating Expense Ratios3 Class A Class C Class I
  1.16% 1.86% 0.86%
Growth of $10,000

This graph shows the change in value of a hypothetical investment of $10,000 in Class A of the Fund for the period indicated. For comparison, the same investment is shown in the indicated index.
Growth of Investment Amount Invested Period Beginning At NAV With Maximum Sales Charge
Class C $10,000 10/31/2012 $8,333 N.A.
Class I, at minimum investment $1,000,000 10/31/2012 $904,635 N.A.
See Endnotes and Additional Disclosures in this report.
Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value (NAV) or offering price (as applicable) with all distributions reinvested. Furthermore, returns do not reflect the deduction of taxes that shareholders may have to pay on Fund distributions or upon the redemption of Fund shares. Investment return and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Performance for periods less than or equal to one year is cumulative. Performance is for the stated time period only; due to market volatility, current Fund performance may be lower or higher than the quoted return. For performance as of the most recent month-end, please refer to eatonvance.com.
3


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Fund Profile

Asset Allocation (% of net assets)1
Foreign Currency Exposure (% of net assets)2
Brazil 12.9%
Mexico 10.3
Indonesia 9.9
Singapore 8.0
Poland 6.8
Thailand 6.1
Dominican Republic 5.3
Czech Republic 5.3
Ukraine 5.2
Malaysia 5.1
Serbia 4.2
Uzbekistan 4.0
South Africa 3.6
Uruguay 3.5
Romania 3.5
Colombia 3.0
Hungary 2.7
Kazakhstan 2.5
Peru 2.5
China 2.4
Korea 2.0
Uganda 1.9
Other 2.0 3
Euro -3.9
Total Long 113.5
Total Short -4.7
Total Net 108.8
 
Footnotes:
Fund invests in an affiliated investment company (Portfolio) with the same objective(s) and policies as the Fund. References to investments are to the Portfolio’s holdings.
1 Other Net Assets represents other assets less liabilities and includes any investment type that represents less than 1% of net assets.
2 Currency exposures include all foreign exchange denominated assets and currency derivatives. Total exposures may exceed 100% due to implicit leverage created by derivatives.
3 Includes amounts each less than 1.0% or –1.0%, as applicable.
4


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Endnotes and Additional Disclosures

†  The views expressed in this report are those of the portfolio manager(s) and are current only through the date stated at the top of this page. These views are subject to change at any time based upon market or other conditions, and Eaton Vance and the Fund(s) disclaim any responsibility to update such views. These views may not be relied upon as investment advice and, because investment decisions are based on many factors, may not be relied upon as an indication of trading intent on behalf of any Eaton Vance fund. This commentary may contain statements that are not historical facts, referred to as “forward-looking statements.” The Fund’s actual future results may differ significantly from those stated in any forward-looking statement, depending on factors such as changes in securities or financial markets or general economic conditions, the volume of sales and purchases of Fund shares, the continuation of investment advisory, administrative and service contracts, and other risks discussed from time to time in the Fund’s filings with the Securities and Exchange Commission.
   
1 J.P. Morgan Government Bond Index: Emerging Markets (JPM GBI-EM) Global Diversified (Unhedged) is an unmanaged index of local-currency bonds with maturities of more than one year issued by emerging markets governments. Information has been obtained from sources believed to be reliable but J.P. Morgan does not warrant its completeness or accuracy. The Index is used with permission. The Index may not be copied, used, or distributed without J.P. Morgan’s prior written approval. Copyright 2021, J.P. Morgan Chase & Co. All rights reserved. Unless otherwise stated, index returns do not reflect the effect of any applicable sales charges, commissions, expenses, taxes or leverage, as applicable. It is not possible to invest directly in an index.
2 Total Returns at NAV do not include applicable sales charges. If sales charges were deducted, the returns would be lower. Total Returns shown with maximum sales charge reflect the stated maximum sales charge. Unless otherwise stated, performance does not reflect the deduction of taxes on Fund distributions or redemptions of Fund shares.
Effective November 5, 2020, Class C shares automatically convert to Class A shares eight years after purchase. The average annual total returns listed for Class C reflect conversion to Class A shares after eight years. Prior to November 5, 2020, Class C shares automatically converted to Class A shares ten years after purchase.
3 Source: Fund prospectus. The expense ratios for the current reporting period can be found in the Financial Highlights section of this report. Performance reflects expenses waived and/or reimbursed, if applicable. Without such waivers and/or reimbursements, performance would have been lower.
  Fund profile subject to change due to active management.
5


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Fund Expenses

Example
As a Fund shareholder, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchases and redemption fees (if applicable); and (2) ongoing costs, including management fees; distribution and/or service fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of Fund investing and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (May 1, 2022 to October 31, 2022).
Actual Expenses
The first section of the table below provides information about actual account values and actual expenses. You may use the information in this section, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first section under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second section of the table below provides information about hypothetical account values and hypothetical expenses based on the actual Fund expense ratio and an assumed rate of return of 5% per year (before expenses), which is not the actual Fund return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption fees (if applicable). Therefore, the second section of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would be higher.
  Beginning
Account Value
(5/1/22)
Ending
Account Value
(10/31/22)
Expenses Paid
During Period*
(5/1/22 – 10/31/22)
Annualized
Expense
Ratio
Actual        
Class A $1,000.00 $ 912.20 $5.74 1.19%
Class C $1,000.00 $ 907.90 $9.14 1.90%
Class I $1,000.00 $ 910.70 $4.33 0.90%
 
Hypothetical        
(5% return per year before expenses)        
Class A $1,000.00 $1,019.21 $6.06 1.19%
Class C $1,000.00 $1,015.63 $9.65 1.90%
Class I $1,000.00 $1,020.67 $4.58 0.90%
* Expenses are equal to the Fund's annualized expense ratio for the indicated Class, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). The Example assumes that the $1,000 was invested at the net asset value per share determined at the close of business on April 30, 2022. The Example reflects the expenses of both the Fund and the Portfolio.
6


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Statement of Assets and Liabilities

  October 31, 2022
Assets  
Investment in Emerging Markets Local Income Portfolio, at value (identified cost $1,081,061,207) $ 831,430,236
Receivable for Fund shares sold 1,895,141
Total assets $ 833,325,377
Liabilities  
Payable for Fund shares redeemed $ 3,127,711
Payable to affiliates:  
Distribution and service fees 51,555
Trustees' fees 43
Other 4,725
Accrued expenses 350,147
Total liabilities $ 3,534,181
Net Assets $ 829,791,196
Sources of Net Assets  
Paid-in capital $ 987,119,888
Accumulated loss (157,328,692)
Net Assets $ 829,791,196
Class A Shares  
Net Assets $ 87,882,831
Shares Outstanding 27,289,873
Net Asset Value and Redemption Price Per Share
(net assets ÷ shares of beneficial interest outstanding)
$ 3.22
Maximum Offering Price Per Share 
(100 ÷ 96.75 of net asset value per share)
$ 3.33
Class C Shares  
Net Assets $ 33,976,129
Shares Outstanding 10,435,925
Net Asset Value and Offering Price Per Share*
(net assets ÷ shares of beneficial interest outstanding)
$ 3.26
Class I Shares  
Net Assets $ 707,932,236
Shares Outstanding 219,967,325
Net Asset Value, Offering Price and Redemption Price Per Share
(net assets ÷ shares of beneficial interest outstanding)
$ 3.22
On sales of $100,000 or more, the offering price of Class A shares is reduced.
* Redemption price per share is equal to the net asset value less any applicable contingent deferred sales charge.
7
See Notes to Financial Statements.


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Statement of Operations

  Year Ended
  October 31, 2022
Investment Income  
Dividend income allocated from Portfolio $ 665,701
Interest income allocated from Portfolio (net of foreign taxes withheld of $1,796,379) 77,130,750
Expenses allocated from Portfolio (8,284,846)
Total investment income from Portfolio $ 69,511,605
Expenses  
Distribution and service fees:  
Class A $ 343,397
Class C 445,833
Trustees’ fees and expenses 500
Custodian fee 60,326
Transfer and dividend disbursing agent fees 772,688
Legal and accounting services 57,971
Printing and postage 372,372
Registration fees 92,024
Miscellaneous 17,513
Total expenses $ 2,162,624
Net investment income $ 67,348,981
Realized and Unrealized Gain (Loss) from Portfolio  
Net realized gain (loss):  
Investment transactions (net of foreign capital gains taxes of $265,099) $ (66,276,484)
Futures contracts 4,642,689
Swap contracts (47,686,429)
Foreign currency transactions (5,696,180)
Forward foreign currency exchange contracts (17,812,193)
Non-deliverable bond forward contracts (18,633,766)
Net realized loss $(151,462,363)
Change in unrealized appreciation (depreciation):  
Investments (including net decrease in accrued foreign capital gains taxes of $1,195,024) $ (175,679,884)
Futures contracts (269,053)
Swap contracts 4,859,563
Foreign currency (872,864)
Forward foreign currency exchange contracts 7,127,568
Non-deliverable bond forward contracts 507,066
Net change in unrealized appreciation (depreciation) $(164,327,604)
Net realized and unrealized loss $(315,789,967)
Net decrease in net assets from operations $(248,440,986)
8
See Notes to Financial Statements.


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Statements of Changes in Net Assets

  Year Ended October 31,
  2022 2021
Increase (Decrease) in Net Assets    
From operations:    
Net investment income $ 67,348,981 $ 73,990,839
Net realized gain (loss) (151,462,363) 14,421,284
Net change in unrealized appreciation (depreciation) (164,327,604) (95,065,101)
Net decrease in net assets from operations $ (248,440,986) $ (6,652,978)
Distributions to shareholders:    
Class A $ $ (3,528,165)
Class C (1,336,288)
Class I (29,959,647)
Total distributions to shareholders $ $ (34,824,100)
Tax return of capital to shareholders:    
Class A $ (13,947,887) $ (11,744,917)
Class C (5,086,599) (4,324,921)
Class I (114,849,166) (107,917,807)
Total tax return of capital to shareholders $ (133,883,652) $ (123,987,645)
Transactions in shares of beneficial interest:    
Class A $ (17,218,330) $ 30,113,299
Class C (9,079,577) 4,959,581
Class I (183,103,782) 379,512,959
Net increase (decrease) in net assets from Fund share transactions $ (209,401,689) $ 414,585,839
Net increase (decrease) in net assets $ (591,726,327) $ 249,121,116
Net Assets    
At beginning of year $1,421,517,523 $ 1,172,396,407
At end of year $ 829,791,196 $1,421,517,523
9
See Notes to Financial Statements.


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Financial Highlights

  Class A
  Year Ended October 31,
  2022 2021 2020 2019 2018
Net asset value — Beginning of year $ 4.590 $ 5.030 $ 5.760 $ 5.190 $ 6.310
Income (Loss) From Operations          
Net investment income(1) $ 0.234 $ 0.228 $ 0.286 $ 0.363 $ 0.408
Net realized and unrealized gain (loss) (1.125) (0.168) (0.293) 0.759 (0.970)
Total income (loss) from operations $ (0.891) $ 0.060 $ (0.007) $ 1.122 $ (0.562)
Less Distributions          
From net investment income $ $ (0.123) $ (0.198) $ (0.552) $
Tax return of capital (0.479) (0.377) (0.525) (0.558)
Total distributions $ (0.479) $ (0.500) $ (0.723) $ (0.552) $ (0.558)
Net asset value — End of year $ 3.220 $ 4.590 $ 5.030 $ 5.760 $ 5.190
Total Return(2) (20.47)% 1.06% (0.31)% (3) 22.64% (3) (9.65)% (3)
Ratios/Supplemental Data          
Net assets, end of year (000’s omitted) $87,883 $145,043 $129,954 $152,308 $107,550
Ratios (as a percentage of average daily net assets):(4)          
Expenses 1.19% (5) 1.16% 1.20% (3) 1.20% (3) 1.23% (3)(6)
Net investment income 5.99% 4.53% 5.40% 6.57% 6.84%
Portfolio Turnover of the Portfolio 33% 56% 56% 46% 52%
(1) Computed using average shares outstanding.
(2) Returns are historical and are calculated by determining the percentage change in net asset value with all distributions reinvested and do not reflect the effect of sales charges.
(3) The investment adviser reimbursed certain operating expenses (equal to 0.02%, 0.02% and 0.09% of average daily net assets for the years ended October 31, 2020, 2019 and 2018, respectively). Absent this reimbursement, total return would be lower.
(4) Includes the Fund’s share of the Portfolio’s allocated expenses.
(5) Includes a reduction by the investment adviser of a portion of the Portfolio's adviser fee due to the Portfolio’s investment in the Liquidity Fund (equal to less than 0.005% of average daily net assets for the year ended October 31, 2022).
(6) Includes interest expense, including on securities sold short and/or reverse repurchase agreements if applicable, of 0.02% of average daily net assets for the year ended October 31, 2018.
10
See Notes to Financial Statements.


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Financial Highlights — continued

  Class C
  Year Ended October 31,
  2022 2021 2020 2019 2018
Net asset value — Beginning of year $ 4.650 $ 5.080 $ 5.820 $ 5.240 $ 6.380
Income (Loss) From Operations          
Net investment income(1) $ 0.209 $ 0.194 $ 0.250 $ 0.328 $ 0.373
Net realized and unrealized gain (loss) (1.142) (0.154) (0.298) 0.770 (0.992)
Total income (loss) from operations $ (0.933) $ 0.040 $ (0.048) $ 1.098 $ (0.619)
Less Distributions          
From net investment income $ $ (0.115) $ (0.190) $ (0.518) $
Tax return of capital (0.457) (0.355) (0.502) (0.521)
Total distributions $ (0.457) $ (0.470) $ (0.692) $ (0.518) $ (0.521)
Net asset value — End of year $ 3.260 $ 4.650 $ 5.080 $ 5.820 $ 5.240
Total Return(2) (21.31)% 0.46% (0.90)% (3) 21.87% (3) (10.42)% (3)
Ratios/Supplemental Data          
Net assets, end of year (000’s omitted) $33,976 $58,639 $59,169 $62,869 $44,416
Ratios (as a percentage of average daily net assets):(4)          
Expenses 1.89% (5) 1.86% 1.90% (3) 1.90% (3) 1.93% (3)(6)
Net investment income 5.28% 3.82% 4.68% 5.88% 6.17%
Portfolio Turnover of the Portfolio 33% 56% 56% 46% 52%
(1) Computed using average shares outstanding.
(2) Returns are historical and are calculated by determining the percentage change in net asset value with all distributions reinvested and do not reflect the effect of sales charges.
(3) The investment adviser reimbursed certain operating expenses (equal to 0.02%, 0.02% and 0.09% of average daily net assets for the years ended October 31, 2020, 2019 and 2018, respectively). Absent this reimbursement, total return would be lower.
(4) Includes the Fund’s share of the Portfolio’s allocated expenses.
(5) Includes a reduction by the investment adviser of a portion of the Portfolio's adviser fee due to the Portfolio’s investment in the Liquidity Fund (equal to less than 0.005% of average daily net assets for the year ended October 31, 2022).
(6) Includes interest expense, including on securities sold short and/or reverse repurchase agreements if applicable, of 0.02% of average daily net assets for the year ended October 31, 2018.
11
See Notes to Financial Statements.


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Financial Highlights — continued

  Class I
  Year Ended October 31,
  2022 2021 2020 2019 2018
Net asset value — Beginning of year $ 4.590 $ 5.020 $ 5.760 $ 5.190 $ 6.310
Income (Loss) From Operations          
Net investment income(1) $ 0.246 $ 0.243 $ 0.301 $ 0.381 $ 0.427
Net realized and unrealized gain (loss) (1.126) (0.158) (0.302) 0.757 (0.971)
Total income (loss) from operations $ (0.880) $ 0.085 $ (0.001) $ 1.138 $ (0.544)
Less Distributions          
From net investment income $ $ (0.127) $ (0.202) $ (0.568) $
Tax return of capital (0.490) (0.388) (0.537) (0.576)
Total distributions $ (0.490) $ (0.515) $ (0.739) $ (0.568) $ (0.576)
Net asset value — End of year $ 3.220 $ 4.590 $ 5.020 $ 5.760 $ 5.190
Total Return(2) (20.48)% 1.36% (0.01)% (3) 23.00% (3) (9.38)% (3)
Ratios/Supplemental Data          
Net assets, end of year (000’s omitted) $707,932 $1,217,836 $983,273 $938,608 $555,630
Ratios (as a percentage of average daily net assets):(4)          
Expenses 0.89% (5) 0.86% 0.90% (3) 0.90% (3) 0.93% (3)(6)
Net investment income 6.28% 4.86% 5.68% 6.90% 7.15%
Portfolio Turnover of the Portfolio 33% 56% 56% 46% 52%
(1) Computed using average shares outstanding.
(2) Returns are historical and are calculated by determining the percentage change in net asset value with all distributions reinvested.
(3) The investment adviser reimbursed certain operating expenses (equal to 0.02%, 0.02% and 0.09% of average daily net assets for the years ended October 31, 2020, 2019 and 2018, respectively). Absent this reimbursement, total return would be lower.
(4) Includes the Fund’s share of the Portfolio’s allocated expenses.
(5) Includes a reduction by the investment adviser of a portion of the Portfolio's adviser fee due to the Portfolio’s investment in the Liquidity Fund (equal to less than 0.005% of average daily net assets for the year ended October 31, 2022).
(6) Includes interest expense, including on securities sold short and/or reverse repurchase agreements if applicable, of 0.02% of average daily net assets for the year ended October 31, 2018.
12
See Notes to Financial Statements.


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Notes to Financial Statements

1  Significant Accounting Policies
Eaton Vance Emerging Markets Local Income Fund (the Fund) is a non-diversified series of Eaton Vance Mutual Funds Trust (the Trust). The Trust is a Massachusetts business trust registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company. The Fund offers three classes of shares. Class A shares are generally sold subject to a sales charge imposed at time of purchase. Class C shares are sold at net asset value and are generally subject to a contingent deferred sales charge (see Note 5). Effective November 5, 2020, Class C shares automatically convert to Class A shares eight years after their purchase as described in the Fund’s prospectus. Class I shares are sold at net asset value and are not subject to a sales charge. Each class represents a pro-rata interest in the Fund, but votes separately on class-specific matters and (as noted below) is subject to different expenses. Realized and unrealized gains and losses and net investment income and losses, other than class-specific expenses, are allocated daily to each class of shares based on the relative net assets of each class to the total net assets of the Fund. Each class of shares differs in its distribution plan and certain other class-specific expenses. The Fund invests substantially all of its investable assets in interests in Emerging Markets Local Income Portfolio (the Portfolio), a Massachusetts business trust, having the same investment objective and policies as the Fund. The value of the Fund’s investment in the Portfolio reflects the Fund’s proportionate interest in the net assets of the Portfolio (86.7% at October 31, 2022). The performance of the Fund is directly affected by the performance of the Portfolio. The financial statements of the Portfolio, including the portfolio of investments, are included elsewhere in this report and should be read in conjunction with the Fund’s financial statements.
The following is a summary of significant accounting policies of the Fund. The policies are in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP). The Fund is an investment company and follows accounting and reporting guidance in the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946.
A  Investment ValuationValuation of securities by the Portfolio is discussed in Note 1A of the Portfolio's Notes to Financial Statements, which are included elsewhere in this report.
B  Income The Fund's net investment income or loss consists of the Fund's pro-rata share of the net investment income or loss of the Portfolio, less all actual and accrued expenses of the Fund.
C  Federal and Other TaxesThe Fund’s policy is to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute to shareholders each year substantially all of its net investment income, and all or substantially all of its net realized capital gains. Accordingly, no provision for federal income or excise tax is necessary.
In addition to the requirements of the Internal Revenue Code, the Fund may also be required to recognize its pro-rata share of the capital gains taxes incurred by the Portfolio. In doing so, the daily net asset value would reflect the Fund’s pro-rata share of the estimated reserve for such taxes incurred by the Portfolio.
As of October 31, 2022, the Fund had no uncertain tax positions that would require financial statement recognition, de-recognition, or disclosure. The Fund files a U.S. federal income tax return annually after its fiscal year-end, which is subject to examination by the Internal Revenue Service for a period of three years from the date of filing.
D  ExpensesThe majority of expenses of the Trust are directly identifiable to an individual fund. Expenses which are not readily identifiable to a specific fund are allocated taking into consideration, among other things, the nature and type of expense and the relative size of the funds.
E  Use of EstimatesThe preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting period. Actual results could differ from those estimates.
F  IndemnificationsUnder the Trust’s organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to the Fund. Under Massachusetts law, if certain conditions prevail, shareholders of a Massachusetts business trust (such as the Trust) could be deemed to have personal liability for the obligations of the Trust. However, the Trust’s Declaration of Trust contains an express disclaimer of liability on the part of Fund shareholders and the By-laws provide that the Trust shall assume, upon request by the shareholder, the defense on behalf of any Fund shareholders. Moreover, the By-laws also provide for indemnification out of Fund property of any shareholder held personally liable solely by reason of being or having been a shareholder for all loss or expense arising from such liability. Additionally, in the normal course of business, the Fund enters into agreements with service providers that may contain indemnification clauses. The Fund's maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Fund that have not yet occurred.
G  OtherInvestment transactions are accounted for on a trade date basis.
13


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Notes to Financial Statements — continued

2  Distributions to Shareholders and Income Tax Information
The Fund expects to pay any required income distributions monthly and intends to distribute annually all or substantially all of its net realized capital gains. The Fund may include in its distributions amounts attributable to the imputed interest on foreign currency exposures and certain other derivative positions which, in certain circumstances, may result in a return of capital for federal income tax purposes. Distributions to shareholders are recorded on the ex-dividend date. Distributions are declared separately for each class of shares. Shareholders may reinvest income and capital gain distributions in additional shares of the same class of the Fund at the net asset value as of the ex-dividend date or, at the election of the shareholder, receive distributions in cash. Distributions to shareholders are determined in accordance with income tax regulations, which may differ from U.S. GAAP. As required by U.S. GAAP, only distributions in excess of tax basis earnings and profits are reported in the financial statements as a return of capital. Permanent differences between book and tax accounting relating to distributions are reclassified to paid-in capital. For tax purposes, distributions from short-term capital gains are considered to be from ordinary income.
The tax character of distributions declared for the years ended October 31, 2022 and October 31, 2021 was as follows:
  Year Ended October 31,
  2022 2021
Ordinary income $  — $ 34,824,100
Tax return of capital $133,883,652 $123,987,645
During the year ended October 31, 2022, accumulated loss was decreased by $126,799,228 and paid-in capital was decreased by $126,799,228 due to differences between book and tax accounting, primarily for net operating losses. These reclassifications had no effect on the net assets or net asset value per share of the Fund.
As of October 31, 2022, the components of distributable earnings (accumulated loss) on a tax basis were as follows:
Deferred capital losses $ (44,681,829)
Net unrealized depreciation (112,646,863)
Accumulated loss $(157,328,692)
At October 31, 2022, the Fund, for federal income tax purposes, had deferred capital losses of $44,681,829 which would reduce its taxable income arising from future net realized gains on investment transactions, if any, to the extent permitted by the Internal Revenue Code, and thus would reduce the amount of distributions to shareholders, which would otherwise be necessary to relieve the Fund of any liability for federal income or excise tax. The deferred capital losses are treated as arising on the first day of the Fund’s next taxable year and retain the same short-term or long-term character as when originally deferred. Of the deferred capital losses at October 31, 2022, $44,681,829 are short-term.
3  Investment Adviser Fee and Other Transactions with Affiliates
The investment adviser fee is earned by Eaton Vance Management (EVM), an indirect, wholly-owned subsidiary of Morgan Stanley, as compensation for investment advisory services rendered to the Fund. The investment adviser fee is computed at an annual rate as a percentage of the Fund’s average daily net assets that are not invested in other investment companies for which EVM or its affiliates serve as investment adviser or administrator as follows and is payable monthly:
Average Daily Net Assets Annual Fee Rate
Up to $1 billion 0.650%
$1 billion but less than $2 billion 0.625%
$2 billion but less than $5 billion 0.600%
$5 billion and over 0.575%
For the year ended October 31, 2022, the Fund incurred no investment adviser fee on such assets. To the extent the Fund’s assets are invested in the Portfolio, the Fund is allocated its share of the Portfolio’s investment adviser fee. The Portfolio has engaged Boston Management and Research (BMR) to render investment advisory services. See Note 2 of the Portfolio’s Notes to Financial Statements which are included elsewhere in this report. EVM also serves as the administrator of the Fund, but receives no compensation. EVM has agreed to reimburse the Fund’s expenses to the extent that total annual
14


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Notes to Financial Statements — continued

operating expenses (relating to ordinary operating expenses only and excluding such expenses as borrowing costs, taxes or litigation expenses) exceed 1.20%, 1.90% and 0.90% of the Fund’s average daily net assets for Class A, Class C and Class I, respectively. This agreement may be changed or terminated after February 28, 2023. Pursuant to this agreement, no operating expenses were allocated to EVM for the year ended October 31, 2022.
EVM provides sub-transfer agency and related services to the Fund pursuant to a Sub-Transfer Agency Support Services Agreement. For the year ended October 31, 2022, EVM earned $20,080 from the Fund pursuant to such agreement, which is included in transfer and dividend disbursing agent fees on the Statement of Operations. The Fund was informed that Eaton Vance Distributors, Inc. (EVD), an affiliate of EVM and the Fund's principal underwriter, received $51,604 as its portion of the sales charge on sales of Class A shares for the year ended October 31, 2022. The Fund was informed that Morgan Stanley affiliated broker-dealers, which may be deemed to be affiliates of EVM, BMR and EVD, also received a portion of the sales charge on sales of Class A shares for the year ended October 31, 2022 in the amount of $1,551. EVD also received distribution and service fees from Class A and Class C shares (see Note 4) and contingent deferred sales charges (see Note 5).
Trustees and officers of the Fund who are members of EVM’s or BMR's organizations receive remuneration for their services to the Fund out of the investment adviser fee. Certain officers and Trustees of the Fund and the Portfolio are officers of the above organizations.
4  Distribution Plans
The Fund has in effect a distribution plan for Class A shares (Class A Plan) pursuant to Rule 12b-1 under the 1940 Act. Pursuant to the Class A Plan, the Fund pays EVD a distribution and service fee of 0.30% per annum of its average daily net assets attributable to Class A shares for distribution services and facilities provided to the Fund by EVD, as well as for personal services and/or the maintenance of shareholder accounts. Distribution and service fees paid or accrued to EVD for the year ended October 31, 2022 amounted to $343,397 for Class A shares.
The Fund also has in effect a distribution plan for Class C shares (Class C Plan) pursuant to Rule 12b-1 under the 1940 Act. Pursuant to the Class C Plan, the Fund pays EVD amounts equal to 0.75% per annum of its average daily net assets attributable to Class C shares for providing ongoing distribution services and facilities to the Fund. For the year ended October 31, 2022, the Fund paid or accrued to EVD $334,375 for Class C shares.
Pursuant to the Class C Plan, the Fund also makes payments of service fees to EVD, financial intermediaries and other persons in amounts equal to 0.25% per annum of its average daily net assets attributable to that class. Service fees paid or accrued are for personal services and/or the maintenance of shareholder accounts. They are separate and distinct from the sales commissions and distribution fees payable to EVD. Service fees paid or accrued for the year ended October 31, 2022 amounted to $111,458 for Class C shares.
Distribution and service fees are subject to the limitations contained in the Financial Industry Regulatory Authority Rule 2341(d).
5  Contingent Deferred Sales Charges
A contingent deferred sales charge (CDSC) of 1% generally is imposed on redemptions of Class C shares made within 12 months of purchase. Class A shares may be subject to a 0.75% (1% prior to April 29, 2022) CDSC if redeemed within 12 months (18 months prior to April 29, 2022) of purchase (depending on the circumstances of purchase). Generally, the CDSC is based upon the lower of the net asset value at date of redemption or date of purchase. No charge is levied on shares acquired by reinvestment of dividends or capital gain distributions. For the year ended October 31, 2022, the Fund was informed that EVD received approximately $9,000 and $8,000 of CDSCs paid by Class A and Class C shareholders, respectively.
6  Investment Transactions
For the year ended October 31, 2022, increases and decreases in the Fund's investment in the Portfolio aggregated $109,200,430 and $451,022,305, respectively.
15


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Notes to Financial Statements — continued

7  Shares of Beneficial Interest
The Fund’s Declaration of Trust permits the Trustees to issue an unlimited number of full and fractional shares of beneficial interest (without par value). Such shares may be issued in a number of different series (such as the Fund) and classes. Transactions in Fund shares, including direct exchanges pursuant to share class conversions for all periods presented, were as follows:
  Year Ended
October 31, 2022
  Year Ended
October 31, 2021
  Shares Amount   Shares Amount
Class A          
Sales   8,744,229 $  34,415,385    18,274,543 $    92,948,187
Issued to shareholders electing to receive payments of distributions in Fund shares   3,336,364  12,695,340     2,799,887    13,895,628
Redemptions (16,356,773) (64,329,055)   (15,367,242)   (76,730,516)
Net increase (decrease)  (4,276,180) $ (17,218,330)     5,707,188 $   30,113,299
Class C          
Sales   1,633,628 $   6,788,155     3,368,182 $    17,293,127
Issued to shareholders electing to receive payments of distributions in Fund shares   1,277,313   4,922,131     1,095,871     5,499,953
Redemptions  (5,096,503) (20,789,863)    (3,486,291)   (17,833,499)
Net increase (decrease)  (2,185,562) $  (9,079,577)       977,762 $    4,959,581
Class I          
Sales 103,149,612 $ 411,448,840   212,433,306 $ 1,086,953,947
Issued to shareholders electing to receive payments of distributions in Fund shares  27,991,737 106,732,653    25,659,906   127,179,340
Redemptions (176,382,555) (701,285,275)   (168,623,621)  (834,620,328)
Net increase (decrease) (45,241,206) $(183,103,782)    69,469,591 $  379,512,959
16


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Report of Independent Registered Public Accounting Firm

To the Trustees of Eaton Vance Mutual Funds Trust and Shareholders of Eaton Vance Emerging Markets Local Income Fund:
Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities of Eaton Vance Emerging Markets Local Income Fund (the “Fund”) (one of the funds constituting Eaton Vance Mutual Funds Trust), as of October 31, 2022, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, the financial highlights for each of the five years in the period then ended, and the related notes. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of the Fund as of October 31, 2022, and the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on the Fund's financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. We believe that our audits provide a reasonable basis for our opinion.
/s/ Deloitte & Touche LLP
Boston, Massachusetts
December 29, 2022
We have served as the auditor of one or more Eaton Vance investment companies since 1959.
17


Eaton Vance
Emerging Markets Local Income Fund
October 31, 2022
Federal Tax Information (Unaudited)

The Form 1099-DIV you receive in February 2023 will show the tax status of all distributions paid to your account in calendar year 2022. Shareholders are advised to consult their own tax adviser with respect to the tax consequences of their investment in the Fund. As required by the Internal Revenue Code and/or regulations, shareholders must be notified regarding the status of the foreign tax credit and 163(j) interest dividends.
Foreign Tax Credit. For the fiscal year ended October 31, 2022, the Fund paid foreign taxes of $1,926,271 and recognized foreign source income of $76,319,136.
163(j) Interest Dividends. For the fiscal year ended October 31, 2022, the Fund designates 100% of distributions from net investment income as a 163(j) interest dividend.
18


Emerging Markets Local Income Portfolio
October 31, 2022
Portfolio of Investments

Foreign Corporate Bonds — 2.7%
Security Principal
Amount
(000's omitted)
Value
Brazil — 0.9%
Simpar Finance S.a.r.l., 10.75%, 2/12/28(1) BRL      53,195 $   8,354,153
      $  8,354,153
Colombia — 0.3%
Patrimonio Autonomo Union del Sur, 6.66%, 2/28/41(2) COP  18,185,000 $   2,964,095
      $  2,964,095
Mexico — 0.0%(3)
Petroleos Mexicanos, 7.19%, 9/12/24(2) MXN      10,630 $     488,910
      $    488,910
Peru — 1.2%
Alicorp SAA, 6.875%, 4/17/27(1) PEN      25,530 $   5,961,284
Telefonica del Peru SAA, 7.375%, 4/10/27(2) PEN      24,500   5,397,216
      $ 11,358,500
Uzbekistan — 0.3%
Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden NV (FMO), 15.00%, 12/8/22(1) UZS  34,000,000 $   3,049,577
      $  3,049,577
Total Foreign Corporate Bonds
(identified cost $25,394,686)
    $ 26,215,235
    
Loan Participation Notes — 3.1%
Security Principal
Amount
(000's omitted)
Value
Uzbekistan — 3.1%
Daryo Finance BV (borrower - Uzbek Industrial and Construction Bank ATB), 18.75%, 6/15/23(1)(4)(5) UZS 159,708,000 $  14,300,922
Europe Asia Investment Finance BV (borrower - Joint Stock Commercial Bank "Asaka"), 18.70%, 7/26/23(1)(4)(5) UZS 168,539,054  15,079,756
Total Loan Participation Notes
(identified cost $32,881,388)
    $ 29,380,678
    
Sovereign Government Bonds — 61.3%
Security Principal
Amount
(000's omitted)
Value
Argentina — 0.1%
Provincia de Cordoba, 6.875%, 12/10/25(1) USD       1,106 $     846,272
      $    846,272
Armenia — 0.6%
Republic of Armenia, 7.15%, 3/26/25(1) USD       5,828 $   5,728,085
      $  5,728,085
Azerbaijan — 0.3%
Republic of Azerbaijan, 4.75%, 3/18/24(1) USD       3,142 $   3,080,178
      $  3,080,178
Bahrain — 0.3%
CBB International Sukuk Programme Co. WLL, 6.25%, 11/14/24(1) USD       2,624 $   2,641,116
      $  2,641,116
Bolivia — 0.3%
Bolivian Government International Bond, 5.95%, 8/22/23(1) USD       2,762 $   2,644,615
      $  2,644,615
Bosnia and Herzegovina — 0.1%
Republic of Srpska:      
1.50%, 6/30/23 BAM          32 $      16,315
1.50%, 10/30/23 BAM          88      43,986
1.50%, 12/15/23 BAM          10       4,793
1.50%, 5/31/25 BAM       1,669     781,811
1.50%, 6/9/25 BAM         160      77,177
1.50%, 12/24/25 BAM         232     115,843
1.50%, 9/25/26 BAM         145      72,273
1.50%, 9/26/27 BAM          55      25,425
      $  1,137,623
Brazil — 0.4%
Nota do Tesouro Nacional, 10.00%, 1/1/27 BRL      22,375 $   4,114,701
      $  4,114,701
China — 2.0%
China Government Bond:      
2.68%, 5/21/30 CNY      40,600 $   5,568,123
 
19
See Notes to Financial Statements.


Emerging Markets Local Income Portfolio
October 31, 2022
Portfolio of Investments — continued

Security Principal
Amount
(000's omitted)
Value
China (continued)
China Government Bond:(continued)      
3.53%, 10/18/51 CNY      93,820 $  13,847,468
      $ 19,415,591
Colombia — 2.5%
Republic of Colombia:      
2.625%, 3/15/23 USD       3,500 $   3,447,066
4.00%, 2/26/24 USD       3,429   3,289,748
Titulos De Tesoreria B:      
5.75%, 11/3/27 COP  27,398,000   4,027,515
6.00%, 4/28/28 COP  18,865,200   2,744,340
7.00%, 3/26/31 COP  64,677,900   8,790,405
7.00%, 6/30/32 COP   5,447,000     712,701
10.00%, 7/24/24 COP   3,528,300     687,059
      $ 23,698,834
Costa Rica — 0.7%
Costa Rica Government Bond, 9.66%, 9/30/26(1) CRC   4,136,100 $   6,752,472
      $  6,752,472
Czech Republic — 0.4%
Czech Republic Government Bond, 0.95%, 5/15/30(1) CZK     140,000 $   3,987,779
      $  3,987,779
Dominican Republic — 5.1%
Dominican Republic:      
8.00%, 1/15/27(1) DOP     111,360 $   1,746,879
8.00%, 2/12/27(1) DOP     568,540   8,866,241
8.90%, 2/15/23(1) DOP     145,250   2,675,276
12.00%, 8/8/25(2) DOP     836,870  14,761,457
12.75%, 9/23/29(2) DOP     587,800  11,092,860
13.00%, 6/10/34(1) DOP     312,000   5,708,155
Dominican Republic Central Bank Notes:      
8.00%, 3/12/27(1) DOP      36,140     538,626
12.00%, 10/3/25(2) DOP     221,270   3,895,602
      $ 49,285,096
Ecuador — 0.2%
Republic of Ecuador, 1.50% to 7/31/23, 7/31/40(1)(6) USD       6,853 $   2,288,275
      $  2,288,275
El Salvador — 0.5%
Republic of El Salvador, 7.75%, 1/24/23(1) USD       4,660 $   4,252,080
      $  4,252,080
Security Principal
Amount
(000's omitted)
Value
Honduras — 0.2%
Honduras Government International Bond, 7.50%, 3/15/24(1) USD       2,218 $   2,218,000
      $  2,218,000
Hungary — 0.7%
Hungary Government Bond, 3.25%, 10/22/31 HUF   4,850,000 $   7,114,005
      $  7,114,005
Indonesia — 6.1%
Indonesia Government Bond:      
6.50%, 2/15/31 IDR 339,135,000 $  20,334,619
7.50%, 5/15/38 IDR 267,486,000  17,042,961
7.50%, 4/15/40 IDR  45,427,000   2,872,553
8.25%, 5/15/36 IDR 242,576,000  16,197,032
8.375%, 4/15/39 IDR  22,764,000   1,544,770
9.50%, 5/15/41 IDR   5,702,000     427,465
      $ 58,419,400
Iraq — 0.2%
Republic of Iraq, 6.752%, 3/9/23(1) USD       1,710 $   1,687,582
      $  1,687,582
Ivory Coast — 0.1%
Ivory Coast Government International Bond, 5.125%, 6/15/25(1) EUR         721 $     666,926
      $    666,926
Jordan — 0.4%
Kingdom of Jordan, 4.95%, 7/7/25(1) USD       4,503 $   4,217,442
      $  4,217,442
Macedonia — 0.6%
North Macedonia Government International Bond:      
2.75%, 1/18/25(1) EUR         913 $     823,941
5.625%, 7/26/23(1) EUR       5,192   5,122,434
      $  5,946,375
Malaysia — 1.2%
Malaysia Government Bond:      
3.828%, 7/5/34 MYR      28,100 $   5,496,585
4.254%, 5/31/35 MYR      27,750   5,633,437
      $ 11,130,022
 
20
See Notes to Financial Statements.


Emerging Markets Local Income Portfolio
October 31, 2022
Portfolio of Investments — continued

Security Principal
Amount
(000's omitted)
Value
Mexico — 3.2%
Mexican Bonos:      
7.75%, 11/13/42 MXN     230,000 $   9,371,617
8.50%, 5/31/29 MXN      39,000   1,844,030
8.50%, 11/18/38 MXN     410,469  18,271,349
10.00%, 11/20/36 MXN      22,074   1,120,646
      $ 30,607,642
Oman — 0.3%
Oman Government International Bond, 4.875%, 2/1/25(1) USD       3,173 $   3,091,454
      $  3,091,454
Paraguay — 0.2%
Republic of Paraguay, 4.625%, 1/25/23(1) USD       2,330 $   2,326,528
      $  2,326,528
Peru — 2.4%
Peru Government Bond:      
5.94%, 2/12/29 PEN       4,380 $     987,224
6.15%, 8/12/32 PEN       6,602   1,413,466
6.714%, 2/12/55 PEN       4,100     830,512
6.85%, 2/12/42 PEN      19,284   4,093,957
6.90%, 8/12/37 PEN       8,763   1,891,033
6.95%, 8/12/31 PEN      59,887  13,834,224
      $ 23,050,416
Romania — 3.2%
Romania Government International Bond:      
2.75%, 2/26/26(1) EUR       2,755 $   2,487,020
3.624%, 5/26/30(1) EUR       2,755   2,144,069
Romanian Government Bond:      
3.25%, 6/24/26 RON      57,650   9,589,911
4.15%, 1/26/28 RON      48,045   7,722,013
4.85%, 4/22/26 RON      32,030   5,668,019
5.80%, 7/26/27 RON      16,020   2,824,513
      $ 30,435,545
Serbia — 3.9%
Serbia Treasury Bond:      
4.50%, 1/11/26 RSD   1,114,580 $   8,757,149
4.50%, 8/20/32 RSD   3,298,130  21,393,150
5.875%, 2/8/28 RSD     970,810   7,626,941
      $ 37,777,240
Security Principal
Amount
(000's omitted)
Value
Seychelles — 0.1%
Republic of Seychelles, 8.00%, 1/1/26(1) USD         688 $     674,683
      $    674,683
South Africa — 12.4%
Republic of South Africa:      
8.25%, 3/31/32 ZAR     147,394 $   6,613,121
8.50%, 1/31/37 ZAR     369,200  15,504,566
8.75%, 1/31/44 ZAR     408,487  16,882,091
8.75%, 2/28/48 ZAR     231,000   9,504,090
9.00%, 1/31/40 ZAR     334,480  14,345,197
10.50%, 12/21/26 ZAR     980,230  56,004,172
      $118,853,237
Suriname — 0.5%
Republic of Suriname, 9.25%, 10/26/26(1)(7) USD       5,529 $   4,439,787
      $  4,439,787
Thailand — 3.8%
Thailand Government Bond:      
1.585%, 12/17/35 THB     528,144 $  10,972,076
3.30%, 6/17/38 THB     594,751  14,658,518
3.40%, 6/17/36 THB     205,000   5,239,907
4.875%, 6/22/29 THB     183,489   5,363,958
      $ 36,234,459
Ukraine — 4.1%
Ukraine Government Bond:      
9.79%, 5/26/27(4) UAH     914,377 $   8,188,451
9.99%, 5/22/24(4) UAH     589,859   6,896,361
10.00%, 8/23/23(4) UAH      38,483     402,061
10.95%, 11/1/23(4) UAH      12,367     129,208
11.67%, 11/22/23(4) UAH     118,929   1,242,542
12.52%, 5/13/26(4) UAH     166,150   1,529,241
15.84%, 2/26/25(4) UAH   1,853,842  20,751,963
15.97%, 4/19/23(4) UAH       2,910      30,403
      $ 39,170,230
United Arab Emirates — 0.3%
Sharjah Sukuk Ltd., 3.764%, 9/17/24(1) USD       2,747 $   2,629,665
      $  2,629,665
Uruguay — 1.8%
Uruguay Government Bond, 3.875%, 7/2/40(8) UYU     678,613 $  16,847,962
 
21
See Notes to Financial Statements.


Emerging Markets Local Income Portfolio
October 31, 2022
Portfolio of Investments — continued

Security Principal
Amount
(000's omitted)
Value
Uruguay (continued)
Uruguay Monetary Regulation Bill, 0.00%, 7/3/24 UYU      38,225 $     783,044
      $ 17,631,006
Uzbekistan — 0.5%
Republic of Uzbekistan:      
4.75%, 2/20/24(1) USD       3,100 $   2,960,113
14.00%, 7/19/24(1) UZS   5,000,000     437,758
14.50%, 11/25/23(1) UZS  11,470,000   1,032,022
      $  4,429,893
Vietnam — 0.3%
Vietnam Government International Bond, 4.80%, 11/19/24(1) USD       3,124 $   3,022,470
      $  3,022,470
Zambia — 1.3%
Zambia Government Bond:      
11.00%, 1/25/26 ZMW     100,560 $   4,136,824
11.00%, 12/27/26 ZMW      73,540   2,733,385
12.00%, 3/22/28 ZMW      31,390   1,070,406
12.00%, 5/31/28 ZMW      14,200     476,572
12.00%, 11/1/28 ZMW      21,800     712,711
12.00%, 2/21/29 ZMW      47,550   1,517,673
13.00%, 12/27/31 ZMW      57,140   1,731,079
14.00%, 12/5/31 ZMW       4,800     154,681
      $ 12,533,331
Total Sovereign Government Bonds
(identified cost $838,113,831)
    $588,180,055
    
Short-Term Investments — 16.1%
Affiliated Fund — 3.6%
Security Shares Value
Morgan Stanley Institutional Liquidity Funds - Government Portfolio, Institutional Class, 2.88%(9)    34,198,985 $  34,198,985
Total Affiliated Fund
(identified cost $34,198,985)
    $ 34,198,985
    
Sovereign Government Securities — 8.6%
Security Principal
Amount
(000's omitted)
Value
Israel — 4.8%
Bank of Israel Treasury Bill:      
0.00%, 12/7/22 ILS     156,100 $  44,114,689
0.00%, 1/4/23 ILS       5,359   1,510,546
      $ 45,625,235
Uganda — 1.9%
Uganda Treasury Bill:      
0.00%, 3/30/23 UGX  22,640,400 $   5,683,418
0.00%, 4/13/23 UGX  16,824,100   4,199,437
0.00%, 4/27/23 UGX   1,425,700     353,813
0.00%, 5/25/23 UGX  31,532,000   7,738,089
      $ 17,974,757
Ukraine — 0.3%
Ukraine Treasury Bill, 0.00%, 3/1/23(4) UAH     122,375 $   2,887,584
      $  2,887,584
Uruguay — 1.6%
Uruguay Monetary Regulation Bill:      
0.00%, 11/11/22 UYU     118,450 $   2,905,215
0.00%, 11/16/22 UYU      31,006     759,278
0.00%, 11/23/22 UYU     236,075   5,768,358
0.00%, 1/11/23 UYU     262,600   6,316,621
      $ 15,749,472
Total Sovereign Government Securities
(identified cost $85,759,735)
    $ 82,237,048
    
U.S. Treasury Obligations — 3.9%
Security Principal
Amount
(000's omitted)
Value
U.S. Treasury Bill:      
0.00%, 11/8/22(10) $      15,950 $  15,941,739
0.00%, 11/15/22(10)        21,700  21,674,726
Total U.S. Treasury Obligations
(identified cost $37,617,744)
    $ 37,616,465
Total Short-Term Investments
(identified cost $157,576,464)
    $154,052,498
 
22
See Notes to Financial Statements.


Emerging Markets Local Income Portfolio
October 31, 2022
Portfolio of Investments — continued

    Value
Total Investments — 83.2%
(identified cost $1,053,966,369)
    $797,828,466
Other Assets, Less Liabilities — 16.8%     $160,902,065
Net Assets — 100.0%     $958,730,531
The percentage shown for each investment category in the Portfolio of Investments is based on net assets.
(1) Security exempt from registration under Regulation S of the Securities Act of 1933, as amended, which exempts from registration securities offered and sold outside the United States. Security may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933, as amended. At October 31, 2022, the aggregate value of these securities is $138,483,635 or 14.4% of the Portfolio's net assets.
(2) Security exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be sold in certain transactions in reliance on an exemption from registration (normally to qualified institutional buyers). At October 31, 2022, the aggregate value of these securities is $38,600,140 or 4.0% of the Portfolio's net assets.
(3) Amount is less than 0.05%.
(4) For fair value measurement disclosure purposes, security is categorized as Level 3 (see Note 8).
(5) Limited recourse note whose payments by the issuer are limited to amounts received by the issuer from the borrower pursuant to a loan agreement with the borrower.
(6) Step coupon security. Interest rate represents the rate in effect at October 31, 2022.
(7) Issuer is in default with respect to interest and/or principal payments. For a variable rate security, interest rate has been adjusted to reflect non-accrual status.
(8) Inflation-linked security whose principal is adjusted for inflation based on changes in a designated inflation index or inflation rate for the applicable country. Interest is calculated based on the inflation-adjusted principal.
(9) May be deemed to be an affiliated investment company. The rate shown is the annualized seven-day yield as of October 31, 2022.
(10) Security (or a portion thereof) has been pledged to cover collateral requirements on open derivative contracts.
 
Forward Foreign Currency Exchange Contracts (Centrally Cleared)
Currency Purchased Currency Sold Settlement
Date
Value/Unrealized
Appreciation
(Depreciation)
BRL      83,521,000 USD      15,230,497 11/3/22 $   938,509
BRL      47,329,000 USD       8,678,806 11/3/22    483,715
BRL      53,195,000 USD       9,914,452 11/3/22    383,680
BRL      11,137,000 USD       2,038,325 11/3/22    117,710
BRL       7,610,000 USD       1,396,927 11/3/22     76,308
BRL         400,000 USD          75,357 11/3/22      2,079
BRL         100,000 USD          18,850 11/3/22        509
BRL       7,000,000 USD       1,363,332 11/3/22     (8,187)
BRL      34,074,000 USD       6,683,208 11/3/22    (86,750)
BRL     110,858,000 USD      21,562,251 11/3/22   (101,018)
USD       2,446,226 BRL      12,900,000 11/3/22    (51,112)
USD       3,405,405 BRL      17,900,000 11/3/22    (59,894)
USD       6,490,026 BRL      34,554,000 11/3/22   (199,356)
USD       9,950,193 BRL      52,850,452 11/3/22   (281,237)
USD      14,974,129 BRL      80,164,000 11/3/22   (544,988)
23
See Notes to Financial Statements.


Emerging Markets Local Income Portfolio
October 31, 2022
Portfolio of Investments — continued

Forward Foreign Currency Exchange Contracts (Centrally Cleared)(continued)
Currency Purchased Currency Sold Settlement
Date
Value/Unrealized
Appreciation
(Depreciation)
USD       9,700,390 BRL      53,195,000 11/3/22 $   (597,742)
USD      19,320,190 BRL     103,660,548 11/3/22   (747,673)
BRL      66,930,800 USD      12,406,080 11/4/22    548,024
BRL      10,328,827 USD       1,909,902 11/4/22     89,188
USD      14,857,621 BRL      77,259,627 11/4/22    (95,573)
USD      17,235,892 ZAR     296,164,336 11/18/22  1,132,749
USD         782,688 ZAR      13,448,922 11/18/22     51,439
BRL     103,660,548 USD      19,198,531 12/2/22    745,295
BRL      34,554,000 USD       6,449,168 12/2/22    198,867
BRL      77,259,627 USD      14,765,902 12/2/22     98,505
BRL      25,600,000 USD       4,848,898 12/2/22     76,427
BRL      25,600,000 USD       4,867,855 12/2/22     57,471
BRL       4,940,000 USD         937,234 12/2/22     13,200
BRL      30,106,000 USD       5,848,778 12/2/22    (56,518)
USD       9,852,021 BRL      53,195,000 12/2/22   (382,460)
CLP   7,662,300,480 USD       8,162,411 12/21/22   (107,615)
COP     267,305,447 USD          59,827 12/21/22     (6,162)
COP     669,840,234 USD         149,919 12/21/22    (15,443)
COP  17,745,107,000 USD       3,599,413 12/21/22    (36,912)
COP 155,687,623,689 USD      34,733,095 12/21/22 (3,477,302)
EUR      10,518,605 USD      10,584,023 12/21/22   (146,526)
EUR     232,869,495 USD     234,317,771 12/21/22 (3,243,905)
IDR  98,100,000,000 USD       6,250,000 12/21/22     18,033
IDR  85,900,000,000 USD       5,473,429 12/21/22     15,093
IDR  76,890,000,000 USD       4,899,100 12/21/22     13,734
IDR  74,380,000,000 USD       4,740,720 12/21/22     11,739
IDR  68,460,462,674 USD       4,363,744 12/21/22     10,491
IDR  46,458,231,000 USD       2,969,810 12/21/22     (1,393)
IDR  46,678,064,232 USD       3,118,280 12/21/22   (135,817)
IDR 102,741,465,413 USD       6,899,345 12/21/22   (334,750)
IDR 352,113,312,995 USD      23,519,378 12/21/22 (1,021,338)
KRW     440,000,000 USD         308,462 12/21/22         90
KRW   2,833,400,000 USD       2,035,503 12/21/22    (48,566)
KRW   4,601,400,000 USD       3,305,627 12/21/22    (78,870)
KRW   8,555,100,000 USD       6,146,040 12/21/22   (146,729)
KRW   8,897,400,000 USD       6,394,475 12/21/22   (155,124)
KRW   8,555,100,000 USD       6,161,978 12/21/22   (162,667)
PEN       7,203,306 USD       1,794,099 12/21/22      3,946
PEN      13,554,568 USD       3,457,445 12/21/22    (74,037)
PEN      63,737,218 USD      16,298,161 12/21/22   (388,468)
USD      10,203,828 COP  45,737,641,000 12/21/22  1,021,556
USD       5,125,511 COP  22,974,590,000 12/21/22    513,140
USD       4,274,784 COP  19,209,683,000 12/21/22    418,255
USD       2,458,543 COP  11,020,172,000 12/21/22    246,137
24
See Notes to Financial Statements.


Emerging Markets Local Income Portfolio
October 31, 2022
Portfolio of Investments — continued

Forward Foreign Currency Exchange Contracts (Centrally Cleared)(continued)
Currency Purchased Currency Sold Settlement
Date
Value/Unrealized
Appreciation
(Depreciation)
USD       2,433,158 COP  10,933,638,859 12/21/22 $   238,125
USD       2,147,278 COP   9,649,265,000 12/21/22    210,095
USD       1,222,206 COP   5,492,103,191 12/21/22    119,613
USD       1,029,980 COP   4,628,443,000 12/21/22    100,776
USD         586,253 COP   2,634,385,000 12/21/22     57,374
USD       2,296,964 COP  11,347,000,000 12/21/22     18,944
USD       2,286,937 COP  11,346,000,000 12/21/22      9,119
USD       2,284,995 COP  11,345,000,000 12/21/22      7,377
USD       1,920,346 COP   9,547,000,000 12/21/22      3,694
USD      47,728,127 EUR      47,433,128 12/21/22    660,750
USD      35,576,732 EUR      35,356,839 12/21/22    492,526
USD      15,093,289 EUR      15,000,000 12/21/22    208,952
USD       8,282,029 EUR       8,230,839 12/21/22    114,657
USD       6,659,334 EUR       6,618,174 12/21/22     92,192
USD       5,538,197 EUR       5,503,967 12/21/22     76,671
USD       5,185,654 EUR       5,153,602 12/21/22     71,790
USD       1,155,484 EUR       1,148,342 12/21/22     15,997
USD         707,750 EUR         703,376 12/21/22      9,798
USD         396,156 EUR         398,508 12/21/22        721
USD      16,406,328 IDR 245,622,414,013 12/21/22    712,451
USD       3,687,617 IDR  55,128,400,000 12/21/22    165,226
USD       3,402,804 IDR  50,944,061,062 12/21/22    147,768
USD       2,730,746 IDR  40,692,600,000 12/21/22    130,720
USD       1,167,254 IDR  17,394,000,000 12/21/22     55,876
USD          89,144 IDR   1,334,599,288 12/21/22      3,871
USD          57,714 IDR     859,900,000 12/21/22      2,771
USD          55,727 IDR     830,000,000 12/21/22      2,695
USD          56,057 IDR     839,900,000 12/21/22      2,392
USD          14,683 IDR     218,800,000 12/21/22        703
USD      14,447,030 PEN      56,498,002 12/21/22    344,347
USD       6,306,008 PEN      24,778,196 12/21/22    121,027
USD       5,738,661 PEN      22,534,000 12/21/22    113,862
USD       3,359,198 PEN      13,440,151 12/21/22      4,350
USD          28,538 PEN         114,417 12/21/22        (22)
USD       3,326,274 PEN      13,350,000 12/21/22     (6,071)
BRL     113,618,000 USD      20,780,499 1/4/23    926,279
BRL      72,310,542 USD      13,235,447 1/4/23    579,519
IDR  50,196,000,000 USD       3,291,239 1/11/23    (87,743)
IDR  53,482,000,000 USD       3,504,718 1/11/23    (91,511)
IDR  60,168,000,000 USD       3,946,996 1/11/23   (107,089)
BRL      80,164,000 USD      14,691,200 2/2/23    529,912
BRL      52,850,452 USD       9,761,271 2/2/23    273,690
USD       5,258,970 IDR  80,173,000,000 7/11/23    190,068
USD       3,018,893 IDR  46,020,000,000 7/11/23    109,299
25
See Notes to Financial Statements.


Emerging Markets Local Income Portfolio
October 31, 2022
Portfolio of Investments — continued

Forward Foreign Currency Exchange Contracts (Centrally Cleared)(continued)
Currency Purchased Currency Sold Settlement
Date
Value/Unrealized
Appreciation
(Depreciation)
USD       2,471,594 IDR  37,653,000,000 7/11/23 $    91,000
          $ 1,216,318
Forward Foreign Currency Exchange Contracts (OTC)
Currency Purchased Currency Sold Counterparty Settlement
Date
Unrealized
Appreciation
Unrealized
(Depreciation)
KZT    253,765,227 USD       525,938 Citibank, N.A. 11/1/22 $     17,282 $         —
KZT    253,765,226 USD       525,938 Citibank, N.A. 11/1/22     17,282         —
KZT     54,546,232 USD       113,049 Citibank, N.A. 11/1/22      3,715         —
KZT     54,546,232 USD       113,049 Citibank, N.A. 11/1/22      3,715         —
USD        116,495 KZT    54,546,231 Citibank, N.A. 11/1/22        —        (269)
USD        116,495 KZT    54,546,231 Citibank, N.A. 11/1/22        —        (269)
USD        541,967 KZT   253,765,226 Citibank, N.A. 11/1/22        —      (1,253)
USD        541,967 KZT   253,765,227 Citibank, N.A. 11/1/22        —      (1,253)
USD        621,851 ZMW    10,695,839 Citibank, N.A. 11/1/22        —     (39,572)
USD     12,586,414 EUR    12,500,000 Citibank, N.A. 11/4/22    231,607         —
USD      3,476,909 EUR     3,500,000 Standard Chartered Bank 11/4/22     17,563         —
USD        283,190 EUR       287,296 UBS AG 11/4/22        —        (768)
KZT    593,832,875 USD     1,221,250 JPMorgan Chase Bank, N.A. 11/7/22     47,662         —
KZT    591,389,138 USD     1,225,677 JPMorgan Chase Bank, N.A. 11/7/22     38,013         —
USD        456,988 ZMW     8,385,735 Standard Chartered Bank 11/16/22        —     (60,002)
TRY    105,000,000 USD     5,527,770 Standard Chartered Bank 11/17/22     53,945         —
USD     12,843,753 CNH    88,000,000 Standard Chartered Bank 11/17/22    838,527         —
USD      9,194,420 CNH    62,000,000 Standard Chartered Bank 11/17/22    736,193         —
USD      9,795,756 CNH    67,040,000 Standard Chartered Bank 11/17/22