In This Report

Annual report dated August 31, 2012, enclosed. 

Schwab International ETFs 

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Schwab International 

Equity ETF TM 

Schwab International Small-Cap 

Equity ETF TM 

Schwab Emerging Markets 

Equity ETF TM

This wrapper is not part of the shareholder report.


Annual Report 

August 31, 2012 

Schwab International 

Equity ETF TM 

Schwab International Small-Cap 

Equity ETF TM 

Schwab Emerging Markets 

Equity ETF TM

This page is intentionally left blank.

In This Report 

Performance at a Glance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 

From the President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 

Fund Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 

Performance and Fund Facts 

Schwab International Equity ETFÏ ....................... 6 

Schwab International Small-Cap Equity ETFÏ. ............. 8 

Schwab Emerging Markets Equity ETFÏ ..................10 

Fund Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 

Financial Statements and Portfolio Holdings 

Schwab International Equity ETFÏ .......................13 

Schwab International Small-Cap Equity ETFÏ..............34 

Schwab Emerging Markets Equity ETFÏ ..................55 

Financial Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72 

Report of Independent Registered Public Accounting Firm . . . . . 81 

Other Federal Tax Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 

Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83 

Investment Advisory Agreement Approval . . . . . . . . . . . . . . . . . . . 84 

Trustees and Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86 

Glossary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89 

Fund investment adviser: Charles Schwab Investment Management, Inc. (CSIM). 

Distributor: SEI Investments Distribution Co. (SIDCO). 

The Sector/Industry classifications in this report use the Global Industry Classification Standard (GICS) which was developed by and 

is the exclusive property of Morgan Stanley Capital International Inc. (MSCI) and Standard & Poor’s (S&P). GICS is a service mark of 

MSCI and S&P and has been licensed for use by Charles Schwab & Co., Inc. The Industry classifications used in the schedules of 

Portfolio Holdings are sub-categories of Sector classifications.

Performance at a Glance 

The performance data quoted represents past performance. Past performance does not guarantee future results. Investment 

return and principal value of an investment will fluctuate so that an investor’s shares, when sold or redeemed, may be 

worth more or less than the original cost. Current performance may be lower or higher than the performance quoted. To 

obtain performance information current to the most recent month end, please visit www.schwabetfs.com. 

Total Return for the Report Period 

Schwab International Equity ETF TM (Ticker Symbol: SCHF) 

NAV Return 1 

-0.79%* 

Market Price Return 1 

-0.27% 

FTSE Developed ex-US Index -0.85% 

ETF Category: Morningstar Foreign Large Blend 2 

-1.62% 

Performance Details pages 6-7 

Schwab International Small-Cap Equity ETF TM (Ticker Symbol: SCHC) 

NAV Return 1 

-5.91% 


-5.35% 

FTSE Developed Small Cap ex-US Liquid Index -6.14% 

ETF Category: Morningstar Foreign Small/Mid Blend 2 

-6.67% 


Schwab Emerging Markets Equity ETF TM (Ticker Symbol: SCHE) 

NAV Return 1 

-7.04% 


-6.62% 

FTSE All-Emerging Index -6.64% 

ETF Category: Morningstar Diversified Emerging Markets 2 

-5.83% 


All fund and index figures on this page assume dividends and distributions were reinvested. Index figures do not include trading and 

management costs, which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less 

than one year are not annualized. Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on 

the redemption of fund shares. 

Investment returns will fluctuate and are subject to market volatility, so that an investor’s shares, when redeemed or sold, may be worth more or 

less than their original cost. Unlike mutual funds, shares of ETFs are not individually redeemable directly with the ETF. Shares are bought and 

sold at market price (not NAV). Brokerage commissions will reduce returns. 

Index ownership — “FTSE˛” is a trademark jointly owned by the London Stock Exchange plc and The Financial Times Limited and is used by 

FTSE International Limited (“FTSE”) under license. FTSE does not sponsor, endorse or promote Schwab ETFs and does not accept any liability 

in relation to their issue, operation and trading. 

* Total return for the report period presented in the table differs from the return in the Financial Highlights. The total return presented in the 

above table is calculated based on the NAV at which shareholder transactions were processed. The total return presented in the Financial 

Highlights section of the report is calculated in the same manner, but also takes into account certain adjustments that are necessary under 

generally accepted accounting principles required in the annual and semiannual reports. 

1 

The fund’s per share net asset value (“NAV”) is the value of one share of the fund. NAV is calculated by taking the fund’s total assets 

(including the market value of securities owned), subtracting liabilities, and dividing by the number of shares outstanding. The NAV Return is 

based on the NAV of the fund, and the Market Price Return is based on the market price per share of the fund. The price used to calculate 

market return (“Market Price”) is determined by using the midpoint between the highest bid and the lowest offer on the primary stock 

exchange on which the shares of the fund are listed for trading, as of the time that the fund’s NAV is calculated. Market Price and NAV 

returns assume that dividends and capital gain distributions have been reinvested in the fund at Market Price and NAV, respectively. 

2 

Source for category information: Morningstar, Inc. The Morningstar Category return represents all passively- and actively-managed ETFs 

within the category as of the report date. 

2 Schwab International ETFs

Marie Chandoha is President and 

CEO of Charles Schwab Investment 

Management, Inc. and the funds 

covered in this report. 

Dear Shareholder, 

As President and CEO of Charles Schwab Investment Management, Inc., I’d 

like to thank you for trusting us to help you meet your investment objectives, 

and for reading this important report concerning the Schwab International 

ETFs. For the 12 months ended August 31, 2012, international stocks endured 

strong headwinds and lackluster global growth, posting mixed returns in localcurrency 

terms that generally translated into losses in U.S. dollar terms as 

many major currencies depreciated versus the U.S. dollar. 

European developments dominated the headlines, while economic growth 

around the globe remained subdued. The euro zone continued to face 

challenging times amid economic austerity measures brought on by the 

region’s sovereign debt crisis. The European Central Bank worked diligently in 

this environment to ensure stability and adequate liquidity in the financial 

markets. Greece restructured its debt in 2012, giving investor confidence a 

temporary lift, but attention soon turned to the much larger debt markets of 

Italy and Spain. Emerging economies generally faced slower-growth scenarios, 

while economic activity in China—a relative bright spot among developing 

markets in recent years—slowed but remained robust. 

The often-challenging international backdrop translated into declines for many 

major world currencies versus the U.S. dollar, weighing on international stock 

returns for U.S. investors. Illustrating this performance, the FTSE Developed 

ex-US Index (Net) returned -0.85% in U.S. dollar terms, weighed down by 

modest declines in the value of Australian, Canadian, British, and Japanese 

Asset Class Performance Comparison % returns during the report period 

This graph compares the performance of various asset classes 

during the report period. Final performance figures for the period are 

in the key below. 

18.00% S&P 500˛ Index: measures U.S. large-cap stocks 

From the President 

13.40% Russell 2000˛ Index: measures U.S. small-cap stocks 

0.47% MSCI EAFE˛ Index: measures (in U.S. dollars) largecap 

stocks in Europe, Australasia and the Far East 

5.78% Barclays U.S. Aggregate Bond Index: measures the 

U.S. bond market 

0.05% Three-Month U.S. Treasury Bills (T-bills): measures 

short-term U.S. Treasury obligations 

15% 

10% 

5% 

0% 

-5% 

-10% 

-15% 

-20% 

8/31/11 

These figures assume dividends and distributions were reinvested. Index figures do not include trading and management costs, which would 

lower performance. Indices are unmanaged and you cannot invest in them directly. Remember that past performance is not an indication of 

future results. 

Data source: Index provider websites and Charles Schwab Investment Management, Inc. 

Nothing in this report represents a recommendation of a security by the investment adviser. 

Manager views and portfolio holdings may have changed since the report date. 

20% 

10/26 

12/28 

2/29 

4/25 

6/27 

8/31/12 

Schwab International ETFs 3

From the President continued 

The often-challenging 

international backdrop 

translated into declines 

for many major world 

currencies versus the 

U.S. dollar, weighing on 

international stock 

returns for U.S. 

investors. 

4 Schwab International ETFs 

currencies relative to the U.S. dollar, in addition to the double-digit depreciation 

of the euro. Losses for international small-cap and emerging-market 

stocks were generally more pronounced in U.S. dollar terms. 

Thank you for investing in the Schwab International ETFs. As you may be 

aware, we recently announced that effective September 20, 2012, we reduced 

the operating expense ratios (OERs) on our entire suite of ETFs. As a result, 

Schwab ETFs now have some of the lowest OERs in their respective Lipper 

categories.* 

We encourage you to review your investment portfolio regularly to ensure that 

it meets your current financial plan. For answers to frequently asked questions 

or for more information about the Schwab International ETFs, please visit 

www.schwabetfs.com. We are also happy to hear from you at 1-800-435-4000. 

Sincerely, 

Indices are unmanaged, do not incur management fees, costs and expenses, and cannot be invested in directly. Index return figures assume 

dividends and distributions were reinvested. 

* This claim is based on expense ratio data comparisons between Schwab and non-Schwab ETFs in their respective Lipper categories. Expense 

ratio data for non-Schwab ETFs were obtained from the funds’ prospectuses as of 9/4/12. Expense ratio data for Schwab ETFs TM are as of 

9/20/12. ETFs in the same Lipper category may track different indexes, have differences in holdings, and show different performances. 

Expense ratios are subject to change. Information has been sourced from Lipper, a Thomson Reuters Company (“Lipper Content”). All such 

information is protected by copyright: · 2012 THOMSON REUTERS. All rights reserved.

Fund Management 

Agnes Hong, CFA, a managing director and portfolio manager of the investment 

adviser, has day-to-day responsibility for the co-management of the funds. Prior to 

joining the firm in September 2009, she worked for five years as a portfolio 

manager for a major asset management firm. Prior to that, she worked in strategy 

and management consulting for five years. In addition, she also worked as a senior 

product manager servicing global financial services clients. 

Ferian Juwono, CFA, a managing director and portfolio manager of the investment 

adviser, has day-to-day responsibility for the co-management of the funds. Prior to 

joining the firm in May 2010, he was a portfolio manager at a major asset 

management firm for three years. Before that position, he was a senior business 

analyst at a major financial firm for nearly two years. In addition, he was a senior 

financial analyst at a regional banking firm for four years. 


Schwab International Equity ETFÏ 

The Schwab International Equity ETF (the fund) seeks to track as closely as possible, before fees and expenses, the total return of 

the FTSE Developed ex-US Index (the index). The index is comprised of large- and mid-capitalization companies in developed 

countries outside the U.S., as defined by the index provider. The index defines the large- and mid-capitalization universe as 

approximately the top 90% of the eligible universe. The fund invests in a representative sample of securities included in the index 

that collectively has a similar profile to the index. Due to the use of representative sampling, the fund may not hold all of the 

securities included in the index. 

During the 12-month period that ended August 31, 2012, the fund closely tracked the index. The fund’s market price return was 

-0.27% and its NAV return was -0.79% (for an explanation of the market price and NAV returns, please refer to footnote 2 on the 

following page). The index returned -0.85% during the same period. Because the return of the index does not include operational 

and transactional costs, the return of the fund tends to differ from that of the index. 

Market Highlights. Large- and mid-cap international stocks generated modestly negative overall returns in U.S. dollar terms, with 

country markets in the index generating mixed results. The euro zone’s sovereign debt crisis weighed on the performance of 

international stocks, as did lackluster overall growth in developed economies around the world. The decline of most major 

currencies from the British pound to Swiss franc versus the U.S. dollar also reduced international stock returns in 

U.S. dollar terms. 

Contributors and Detractors. U.K. stocks were some of the biggest contributors to the index’s return, and to the return of the 

fund. The large average weight of this market reflected part of the reason for this contribution, with shares of U.K. companies 

representing approximately 19% of the fund. Stocks of U.K. companies benefitted from being alternatives to the crisis-plagued euro 

zone. U.K. stocks returned nearly 8% in U.S. dollar terms, a return that would have been higher for U.S. investors if not for the 

roughly 2% depreciation of the British pound versus the U.S. dollar. The fund’s holdings of mobile communications provider 

Vodafone Group provided one example of this market’s performance, returning approximately 19% for the fund. 

German stocks, which represented an average weight of nearly 7%, also provided meaningful contributions. Shares of German 

companies returned approximately 5% for the fund in U.S. dollar terms, benefitting from the country’s safe-haven allure compared 

with many of Europe’s more debt-challenged members. Although modest once converted into U.S. dollars, the return on German 

stocks was far more significant in local-currency terms that excluded the euro’s roughly 12% decline versus the U.S. dollar. Shares 

of pharmaceutical manufacturer Bayer AG provided one example of the performance of German stocks, returning 24% for 

the fund. 

Japanese stocks were some of the bigger detractors from the performance of the index, and from the performance of the fund. 

Shares of Japanese companies represented an average weight of approximately 17% of the fund. With Japan continuing to grapple 

with deflation and uninspiring economic growth, stocks in the country returned approximately -5% in U.S. dollar terms, which 

included a 2% depreciation in the value of the yen relative to the U.S. dollar. Shares of imaging solutions company Canon Inc. 

provided one example of the performance of Japanese stocks, returning -25% for the fund. 

As of 08/31/12: 

Statistics 

Number of Holdings 1,078 

Weighted Average Market 

Cap ($ x 1,000,000) $46,533 

Price/Earnings Ratio (P/E) 18.6 

Price/Book Ratio (P/B) 1.1 

Portfolio Turnover Rate 1 

8% 

Sector Weightings % of Investments 

Financials 23.8% 

Industrials 12.0% 

Consumer Staples 11.3% 

Consumer Discretionary 10.3% 

Materials 10.1% 

Energy 9.7% 

Health Care 8.6% 

Information Technology 5.6% 

Telecommunication Services 4.9% 

Utilities 3.7% 

Total 100.0% 

Top Equity Holdings % of Net Assets 2 

Nestle S.A. – Reg’d 1.7% 

Samsung Electronics Co., Ltd. 

GDR – Reg’d 1.3% 

Novartis AG – Reg’d 1.2% 

HSBC Holdings plc 1.2% 

Vodafone Group plc 1.1% 

BP plc 1.1% 

Royal Dutch Shell plc, A Shares 1.0% 

Roche Holding AG 1.0% 

Total S.A. 0.9% 

GlaxoSmithKline plc 0.9% 

Total 11.4% 


An index is a statistical composite of a specified financial market or sector. Unlike the fund, an index does not actually hold a portfolio of 

securities and its return is not inclusive of operational and transaction costs incurred by the fund. 


less than their original cost. Unlike mutual funds, shares of ETFs are not individually redeemable directly with the ETF. 

Source of Sector Classification: S&P and MSCI. 

1 

Portfolio turnover rate excludes securities received or delivered from processing of in-kind creations or redemptions. 

2 

This list is not a recommendation of any security by the investment adviser. 


Schwab International Equity ETF TM 

Performance and Fund Facts as of 08/31/12 





November 3, 2009 – August 31, 2012 

Performance of Hypothetical 

$10,000 Investment 1 

$20K 

$15K 

$10K 

$5K 

$0K 

11/3/09 

Average Annual Total Returns 1 

8/10 

8/11 

8/31/12 

Fund (NAV) $10,649 

Fund (Market Price) $10,713 

FTSE Developed ex-US Index $10,694 

Fund and Inception Date 1 Year Since Inception** 

Fund: Schwab International Equity ETF TM (11/3/09) 

NAV Return 2 

-0.79%* 2.25% 


-0.27% 2.46% 

FTSE Developed ex-US Index -0.85% 2.40% 

ETF Category: Morningstar Foreign Large Blend 3 

-1.62% 2.93% 

Fund Expense Ratio 4 : 0.13% 

Country Weightings % of Investments 

United Kingdom 19.2% 

Japan 16.3% 

Canada 9.0% 

France 8.4% 

Australia 7.7% 

Switzerland 7.3% 

Germany 6.9% 

Republic of Korea 5.0% 

Hong Kong 4.2% 

Sweden 2.7% 

Other Countries 13.3% 

Total 100.0% 

All total returns on this page assume dividends and distributions were reinvested. Index figures do not include trading and management costs, 

which would lower performance. Indices are unmanaged, and you cannot invest in them directly. Performance results less than one year are not 

annualized. 

International investing may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted 

accounting principles, or from economic or political instability in other nations. 




* Total return for the report period presented in the table differs from the return in the Financial Highlights. The total return presented in the 

above table is calculated based on the NAV at which shareholder transactions were processed. The total return presented in the Financial 

Highlights section of the report is calculated in the same manner, but also takes into account certain adjustments that are necessary under 

generally accepted accounting principles required in the annual and semiannual reports. 

** Inception represents the date that the shares began trading in the secondary market. 

1 

Performance does not reflect the deduction of taxes that a shareholder would pay on fund distributions or on the redemption of fund shares. 

2 





exchange on which the shares of the fund are listed for trading, as of the time that the fund’s NAV is calculated. NAV is used as a proxy for 

purposes of calculating Market Price Return on inception date. Market Price and NAV returns assume that dividends and capital gain distributions 

have been reinvested in the fund at Market Price and NAV, respectively. 

3 



4 

As stated in the prospectus dated December 17, 2011. Effective September 20, 2012, the management fee was reduced to 0.09%. For more 

information, see financial note 4 or refer to the prospectus supplement dated September 20, 2012. 


Schwab International Small-Cap Equity ETFÏ 

The Schwab International Small-Cap Equity ETF (the fund) seeks to track as closely as possible, before fees and expenses, the 

total return of the FTSE Developed Small Cap ex-US Liquid Index (the index). The index is comprised of small-capitalization 

companies in developed countries outside the U.S., as defined by the index provider. The index defines the small-capitalization 

universe as approximately the bottom 10% of the eligible universe with a minimum free-float capitalization of $150 million. The 

fund invests in a representative sample of securities included in the index that collectively has a similar profile to the index. Due to 

the use of representative sampling, the fund may not hold all of the securities included in the index. 





Market Highlights. Small-cap international stocks generated modestly negative overall returns in U.S. dollar terms, with country 

markets in the index generating mixed results. The euro zone’s sovereign debt crisis weighed on the performance of international 

stocks, as did lackluster overall growth in developed economies around the world. The decline of most major currencies from the 

British pound to Swiss franc versus the U.S. dollar also reduced international stock returns in U.S. dollar terms. 

Contributors and Detractors. U.K. stocks were some of the biggest contributors to the index’s return, and to the return of the 

fund. The large average weight of this market reflected part of the reason for this contribution, with shares of U.K. companies 

representing approximately 17% of the fund. Stocks of U.K. companies benefitted from being alternatives to the crisis-plagued euro 

zone. U.K. stocks returned approximately 13% for the fund in U.S. dollar terms, a return that would have been higher still for 

U.S. investors if not for the roughly 2% depreciation of the British pound versus the U.S. dollar. Aberdeen Asset Management was 

a key U.K. performer. Stock of this large money management firm returned nearly 42% for the fund. 

Singaporean stocks, which represented an average weight of nearly 2% of the fund, also positively contributed to performance. 

Stocks in Singapore returned approximately 4% for the fund in U.S. dollar terms, which included a roughly 3% decline in the 

value of Singapore’s dollar relative to the U.S. dollar. Like other countries in the region, Singapore faced its share of challenges, 

enduring economic contraction toward the latter part of the report period as manufacturing output slowed amid lackluster global 

demand. Shares of SATS Ltd. provided one example of this market’s performance. The ground-handling and in-flight catering 

company returned approximately 23% for the fund. 

Japanese stocks were some of the bigger detractors from the fund’s performance. Shares of Japanese companies represented an 

average weight of approximately 15%. With Japan continuing to grapple with deflation and uninspiring economic growth, stocks 

in the country returned approximately -6% in U.S. dollar terms, which included a 2% depreciation in the value of the yen relative 

to the U.S. dollar. Shares of capacitor manufacturer and marketer Nichicon Corp. provided one example of the performance of 

Japanese stocks, returning -47% for the fund. 

As of 08/31/12: 

Statistics 

Number of Holdings 1,035 


Cap ($ x 1,000,000) $1,950 




25% 






Energy 9.4% 






Other 0.1% 

Total 100.0% 


Catamaran Corp. 0.6% 

Pembina Pipeline Corp. 0.5% 

Franco-Nevad Corp. 0.5% 

Athabasca Oil Corp. 0.5% 

Metro, Inc. 0.5% 

Progress Energy Resources Corp. 0.4% 

Viterra, Inc. 0.4% 

Baytex Energy Corp. 0.4% 

Croda International plc 0.4% 

Onex Corp. 0.3% 

Total 4.5% 







1 


2 



Schwab International Small-Cap Equity ETF TM 






January 14, 2010 – August 31, 2012 



$20K 

$15K 

$10K 

$5K 

$0K 

1/14/10 


8/10 

8/11 

8/31/12 

Fund (NAV) $10,584 


FTSE Developed Small Cap ex-US Liquid Index $10,641 

Fund and Inception Date 1 Year Since Inception* 

Fund: Schwab International Small-Cap Equity ETF TM (1/14/10) 

NAV Return 2 

-5.91% 2.18% 


-5.35% 2.24% 

FTSE Developed Small Cap ex-US Liquid Index -6.14% 2.39% 

ETF Category: Morningstar Foreign Small/Mid Blend 3 

-6.67% 1.50% 



Canada 21.9% 


Japan 14.1% 


Germany 4.5% 




France 3.0% 

Sweden 2.5% 


Total 100.0% 



annualized. 



Investments in smaller companies typically exhibit higher volatility. 




* Inception represents the date that the shares began trading in the secondary market. 

1 


2 








3 



4 




Schwab Emerging Markets Equity ETFÏ 

The Schwab Emerging Markets Equity ETF (the fund) seeks to track as closely as possible, before fees and expenses, the total 

return of the FTSE All-Emerging Index (the index). The index is comprised of the large- and mid-capitalization companies in 

emerging market countries, as defined by the index provider. The index defines the large- and mid-capitalization universe as 

approximately the top 90% of the eligible universe. The fund invests in a representative sample of securities included in the index 

that collectively has a similar profile to the index. Due to the use of representative sampling, the fund may not hold all of the 

securities included in the index. 





Market Highlights. Emerging market stocks generated disappointing returns, as global economic growth softened and the euro 

zone’s sovereign debt crisis continued, while the country markets represented by the index generated mixed returns. Particularly 

weighing on performance were signs of a slowdown in manufacturing activity in countries such as Brazil and Taiwan, while China, 

Russia, and India were relative bright spots of economic activity. 

Contributors and Detractors. Malaysian stocks were some of the biggest contributors to the index’s return, and to the return of 

the fund. The relatively large average weight of this market compared with other markets reflected part of the reason for this 

contribution. Shares of companies in Malaysia represented an average weight of approximately 5% of the fund. Malaysian stocks 

returned nearly 11% in U.S. dollar terms, a return that would have been higher for U.S. investors if not for the roughly 5% 

depreciation of the Malaysian ringgit versus the U.S. dollar. The fund’s shares of Malayan Banking provided one example of the 

performance of this market, returning 9% for the fund as Malaysia enjoyed moderate economic growth and unemployment levels 

that hovered around 3.1% in early 2012. 

Turkish stocks, which represented an average weight of nearly 2%, also positively contributed to performance. Stocks in Turkey 

returned an impressive 22% for the fund in U.S. dollar terms, a return that was more noteworthy still when considering the 

roughly 6% decline in the value of Turkey’s lira relative to the U.S. dollar. Turkey enjoyed respectable economic growth in recent 

years, holding up better than many other economies around the world. Shares of retail and commercial banking company Turkiye 

Garanti Bankasi provided one example of the performance of Turkish stocks, returning approximately 21% for the fund. 

Brazilian stocks were some of the most significant detractors from the performance of the index and fund. Shares of companies in 

Brazil represented an average weight of approximately 18%. With Brazil facing decelerating economic growth, lighter demand for 

private-sector loans, and continuing to grapple with inflation concerns, stocks in the country returned approximately -16% in 

U.S. dollar terms. However, returns would have been far better for U.S. investors if not for the sharp 22% depreciation in the value 

of Brazil’s real relative to the U.S. dollar. ADRs representing common stock of metals producer Vale SA provided one example of 

the performance of Brazilian stocks, returning -39% for the fund. 

As of 08/31/12: 

Statistics 

Number of Holdings 611 


Cap ($ x 1,000,000) $29,315 




9% 



Energy 14.9% 









Other 0.5% 

Total 100.0% 


Taiwan Semiconductor 

Manufacturing Co, Ltd. ADR 2.4% 

China Mobile Ltd. 2.0% 

Petroleo Brasileiro S.A. ADR, Pfd 1.8% 

America Movil S.A.B. de C.V., 

Series L 1.5% 

China Construction Bank Corp., H 

Shares 1.5% 

Gazprom OAO ADR 1.4% 

Companhia de Bebidas das 

Americas ADR 1.3% 

Petroleo Brasileiro S.A. ADR 1.2% 

MTN Group Ltd. 1.2% 

LUKOIL OAO ADR 1.1% 

Total 15.4% 







1 


2 



Schwab Emerging Markets Equity ETF TM 






January 14, 2010 – August 31, 2012 



$20K 

$15K 

$10K 

$5K 

$0K 

1/14/10 


8/10 

8/11 

8/31/12 

Fund (NAV) $9,798 


FTSE All-Emerging Index $9,918 

Fund and Inception Date 1 Year Since Inception* 

Fund: Schwab Emerging Markets Equity ETF TM (1/14/10) 

NAV Return 2 

-7.04% -0.77% 


-6.62% -0.49% 

FTSE All-Emerging Index -6.64% -0.31% 

ETF Category: Morningstar Diversified Emerging Markets 3 

-5.83% -0.73% 



Brazil 16.8% 

China 16.6% 

Taiwan 13.1% 

South Africa 10.7% 

India 8.9% 

Russia 6.7% 

Mexico 5.9% 

Malaysia 5.0% 

Indonesia 3.2% 

Thailand 2.6% 


Total 100.0% 



annualized. 



Emerging markets involve heightened risks related to the same factors as international investing, as well as increased volatility and lower 

trading volume. 




* Inception represents the date that the shares began trading in the secondary market. 

1 


2 








3 



4 




Fund Expenses (Unaudited) 

Examples for a $1,000 Investment 

As a fund shareholder, you incur two types of costs: (1) transaction 

costs, including brokerage commissions on purchases and 

sales of fund shares; and, (2) ongoing costs, including management 

fees and other fund expenses. 

The expense examples below are intended to help you understand 

your ongoing cost (in dollars) of investing in a fund and to 

compare this cost with the ongoing cost of investing in other 

mutual funds. These examples are based on an investment of 

$1,000 invested for six months beginning March 1, 2012 and 

held through August 31, 2012. 

Actual Return lines in the table below provide information 

about actual account values and actual expenses. You may use 

this information, together with the amount you invested, to 

estimate the expenses that you paid over the period. To do so, 

simply divide your account value by $1,000 (for example, an 

$8,600 account value � $1,000 = 8.6), then multiply the result 

by the number given for your fund or share class under the 

heading entitled “Expenses Paid During Period.” 

Expense Ratio 1 

(Annualized) 

Hypothetical Return lines in the table below provide information 

about hypothetical account values and hypothetical 

expenses based on a fund’s actual expense ratio and an 

assumed return of 5% per year before expenses. Because the 

return used is not an actual return, it may not be used to 

estimate the actual ending account value or expenses you paid 

for the period. 

You may use this information to compare the ongoing costs of 

investing in the 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, including any redemption fees or brokerage 

commissions you may pay when purchasing or selling shares of 

the fund. If these transactional costs were included, your costs 

would have been higher. 

Beginning 

Account Value 

at 3/1/12 

Ending 

Account Value 

(Net of Expenses) 

at 8/31/12 

Expenses Paid 

During Period 2 

3/1/12–8/31/12 


Actual Return 0.13% $1,000 $ 958.90 $0.64 

Hypothetical 5% Return 0.13% $1,000 $1,024.48 $0.66 


Actual Return 0.35% $1,000 $ 938.70 $1.71 



Actual Return 0.25% $1,000 $ 886.40 $1.19 


1 

Based on the most recent six-month expense ratio; may differ from the expense ratio provided in the Financial Highlights which covers a 12month 

period. 

2 

Expenses for each fund are equal to its annualized expense ratio, multiplied by the average account value over the period, multiplied by 

184 days of the period, and divided by 366 days of the fiscal year. 


Schwab International Equity ETFÏ 

Financial Statements 

Financial Highlights 

Per-Share Data ($) 

9/1/11– 

8/31/12 

9/1/10– 

8/31/11 

10/30/09 1 – 

8/31/10 

Net asset value at beginning of period 25.99 23.82 25.00 

Income (loss) from investment operations: 

Net investment income (loss) 0.76 0.68 0.38 

Net realized and unrealized gains (losses) (1.04) 1.96 2 

(1.52) 

Total from investment operations 

Less distributions: 

(0.28) 2.64 (1.14) 

Distributions from net investment income (0.75) (0.47) (0.04) 

Net asset value at end of period 24.96 25.99 23.82 

Total return (%) (0.75) 11.04 (4.57) 3 

Ratios/Supplemental Data (%) 

Ratios to average net assets: 

Net operating expenses 0.13 0.13 0.14 4,5 

Gross operating expenses 0.13 0.13 0.14 4 

Net investment income (loss) 3.40 3.10 2.94 4 

Portfolio turnover rate 6 

8 6 6 3 

Net assets, end of period ($ x 1,000) 768,666 634,208 285,869 

1 

Commencement of operations. 

2 

The per share amount does not accord with the change in aggregate gains and losses in securities during the period because of the timing 

of sales and repurchases of fund shares in relation to fluctuating market values. 

3 

Not annualized. 

4 

Annualized. 

5 

Effective June 14, 2010, the annual operating expense was reduced. The ratio presented for period ended 8/31/10 is a blended rate. 

6 


See financial notes 13

Schwab International Equity ETF 

Portfolio Holdings as of August 31, 2012 

This section shows all the securities in the fund’s portfolio and 

their values as of the report date. 

The fund files its complete schedule of portfolio holdings with 

the SEC for the first and third quarters of each fiscal year on 

Form N-Q. The fund’s Form N-Q is available on the SEC’s 

website at http://www.sec.gov and may be viewed and copied 

at the SEC’s Public Reference Room in Washington, D.C. Call 

1-800-SEC-0330 for information on the operation of the Public 

Reference Room. The fund also makes available its complete 

schedule of portfolio holdings on a daily basis on the fund’s 

website at www.schwabetfs.com. 

Holdings by Category 

Cost 

($) 

Value 

($) 

99.0% Common Stock 787,965,765 760,958,498 

0.4% Preferred Stock 2,782,165 3,228,286 

0.0% Warrants 

0.0% Other Investment 

— 74 

Company 250,173 250,173 

99.4% Total Investments 

0.3% Collateral Invested for 

790,998,103 764,437,031 

Securities on Loan 

0.3% Other Assets and 

2,686,618 2,686,618 

Liabilities, Net 1,542,671 

100.0% Net Assets 768,666,320 

Security 

Common Stock 99.0% of net assets 


Number 

of Shares 

Value 

($) 

Banks 2.4% 

Australia & New Zealand Banking 

Group Ltd. 158,928 4,076,538 

Bank of Queensland Ltd. 16,940 132,175 

Bendigo & Adelaide Bank Ltd. 28,952 226,797 

Commonwealth Bank of Australia 97,328 5,505,946 

National Australia Bank Ltd. 140,448 3,659,129 

Westpac Banking Corp. 

Capital Goods 0.0% 

182,952 4,683,306 

18,283,891 

CSR Ltd. 72,688 102,162 

GWA Group Ltd. 53,900 107,507 

Leighton Holdings Ltd. 2,772 45,807 

255,476 

Commercial & Professional Services 0.1% 

ALS Ltd. 7,700 65,650 

Brambles Ltd. 112,864 794,313 

Downer EDI Ltd. * 

Consumer Services 0.1% 

42,812 157,509 

1,017,472 

Crown Ltd. 41,888 388,737 

Echo Entertainment Group Ltd. 99,792 420,770 

Flight Centre Ltd. 1,232 30,430 

Tatts Group Ltd. 

Diversified Financials 0.2% 

83,468 234,627 

1,074,564 

ASX Ltd. 13,860 436,297 

14 See financial notes 

Security 

Number 

of Shares 

Value 

($) 

Challenger Ltd. 28,952 108,312 

IOOF Holdings Ltd. 26,180 165,311 

Macquarie Group Ltd. 

Energy 0.6% 

21,560 598,472 

1,308,392 

Aquila Resources Ltd. * 15,400 36,605 

Caltex Australia Ltd. 1,540 24,859 

Energy Resources of Australia Ltd. * 60,060 83,793 

New Hope Corp., Ltd. 24,640 110,515 

Oil Search Ltd. 95,788 744,420 

Origin Energy Ltd. 71,294 876,777 

Paladin Energy Ltd. * 51,436 69,901 

Santos Ltd. 55,440 643,417 

Whitehaven Coal Ltd. 9,548 32,266 

Woodside Petroleum Ltd. 37,576 1,331,969 

WorleyParsons Ltd. 

Food & Staples Retailing 0.6% 

16,324 447,393 

4,401,915 

Metcash Ltd. 64,372 243,482 

Wesfarmers Ltd. 

Wesfarmers Ltd., Price Protected 

57,596 2,054,719 

Shares 13,244 490,132 

Woolworths Ltd. 

Food, Beverage & Tobacco 0.1% 

69,916 2,140,183 

4,928,516 

Coca-Cola Amatil Ltd. 36,960 522,907 

Goodman Fielder Ltd. 56,672 30,455 

Treasury Wine Estates Ltd. 52,821 258,201 

811,563 

Health Care Equipment & Services 0.1% 

Ansell Ltd. 6,160 96,509 

Cochlear Ltd. 3,080 214,536 

Ramsay Health Care Ltd. 9,240 237,772 

Sonic Healthcare Ltd. 

Insurance 0.4% 

19,404 268,912 

817,729 

AMP Ltd. 175,605 809,396 

Insurance Australia Group Ltd. 158,312 678,971 

QBE Insurance Group Ltd. 59,444 800,464 

Suncorp Group Ltd. 


56,980 541,162 

2,829,993 

Adelaide Brighton Ltd. 34,804 105,027 

Alumina Ltd. 72,072 55,117 

Amcor Ltd. 114,884 894,013 

Atlas Iron Ltd. 37,884 52,854 

BHP Billiton Ltd. 186,956 6,142,134 

Boral Ltd. 36,652 130,679 

DuluxGroup Ltd. 21,252 72,038 

Fortescue Metals Group Ltd. 140,756 514,943 

Gunns Ltd. *(a)(b) 346,320 — 

Iluka Resources Ltd. 37,268 354,334 

Incitec Pivot Ltd. 119,504 359,389 

James Hardie Industries SE CDI 10,780 93,358 

Lynas Corp., Ltd. * 100,716 66,614 

Newcrest Mining Ltd. 40,040 1,020,000 

Nufarm Ltd. 15,708 94,966 

Orica Ltd. 21,252 531,502


Portfolio Holdings continued 

Security 

Number 

of Shares 

Value 

($) 

OZ Minerals Ltd. 16,840 108,597 

Rio Tinto Ltd. 33,572 1,708,381 

Sims Metal Management Ltd. 

Media 0.0% 

2,772 26,126 

12,330,072 

Consolidated Media Holdings Ltd. 47,124 168,016 

Pharmaceuticals, Biotechnology & Life Sciences 0.2% 

CSL Ltd. 

Real Estate 0.7% 

34,188 1,569,782 

CFS Retail Property Trust Group 259,952 514,459 

Commonwealth Property Office Fund 336,976 358,695 

Dexus Property Group 379,764 374,806 

Goodman Group 29,568 121,923 

GPT Group 130,972 475,089 

Lend Lease Group 43,469 381,396 

Mirvac Group 199,276 278,021 

Stockland 180,180 592,138 

Westfield Group 136,752 1,400,544 

Westfield Retail Trust 

Retailing 0.0% 

158,312 472,826 

4,969,897 

Harvey Norman Holdings Ltd. 

Software & Services 0.1% 

41,580 88,090 

Computershare Ltd. 


39,424 342,239 

Telstra Corp., Ltd. 

Transportation 0.2% 

226,688 901,942 

Asciano Ltd. 62,216 288,051 

Macquarie Atlas Roads Group * 57,288 89,990 

Qantas Airways Ltd. * 45,584 54,175 

QR National Ltd. 41,580 150,398 

Sydney Airport 23,650 79,434 

Toll Holdings Ltd. 15,400 73,687 

Transurban Group 


137,368 858,876 

1,594,611 

AGL Energy Ltd. 45,276 709,811 

APA Group 21,868 108,930 

Envestra Ltd. 94,864 86,763 

SP Ausnet 70,840 77,236 

982,740 

58,676,900 

Austria 0.3% 

Banks 0.1% 

Erste Group Bank AG * 16,632 336,692 

Raiffeisen Bank International AG 


3,388 113,533 

450,225 

Andritz AG 4,312 222,928 

Strabag SE 

Energy 0.1% 

3,388 76,315 

299,243 

OMV AG 


11,088 368,628 

Vienna Insurance Group AG 2,772 116,319 

Security 

Number 

of Shares 

Value 

($) 


Voestalpine AG 


11,396 327,012 

Immofinanz AG * 


56,728 182,625 

Telekom Austria AG 22,792 182,316 

1,926,368 

Belgium 0.9% 

Banks 0.0% 

Dexia S.A. * 253,176 63,826 

KBC GROEP N.V. 


8,624 187,897 

251,723 

NV Bekaert S.A. 


6,160 161,195 

Groupe Bruxelles Lambert S.A. 


5,544 383,653 

Colruyt S.A. 6,160 293,078 

Delhaize Group 


1,540 61,166 

354,244 

Anheuser-Busch InBev N.V. 


48,048 4,044,497 

Ageas 


17,432 388,923 

Solvay S.A. 2,156 242,440 

Umicore S.A. 6,776 322,172 

564,612 


UCB S.A. 


8,932 439,093 

Belgacom S.A. 12,012 356,725 

Telenet Group Holding N.V. 4,620 179,917 

536,642 

7,124,582 

Canada 9.0% 

Automobiles & Components 0.1% 

Magna International, Inc. 

Banks 2.4% 

14,000 603,496 

Bank of Montreal 30,800 1,798,344 

Bank of Nova Scotia 

Canadian Imperial Bank of 

61,600 3,261,489 

Commerce 30,800 2,379,170 

National Bank of Canada 5,300 397,480 

Royal Bank of Canada 92,400 5,165,636 

The Toronto-Dominion Bank 


61,600 5,033,616 

18,035,735 

Bombardier, Inc., B Shares 123,200 436,946 

Finning International, Inc. 19,600 450,451 

887,397 




Security 

Number 

of Shares 

Value 

($) 


Tim Hortons, Inc. 


5,000 252,318 

CI Financial Corp. 12,600 283,192 

IGM Financial, Inc. 

Energy 2.3% 

5,000 192,076 

475,268 

Cameco Corp. 5,700 124,067 

Canadian Natural Resources Ltd. 67,900 2,063,455 

Canadian Oil Sands Ltd. 30,800 656,667 

Cenovus Energy, Inc. 45,440 1,487,270 

Crescent Point Energy Corp. 300 12,461 

Enbridge, Inc. 61,600 2,422,553 

EnCana Corp. 51,700 1,143,126 

Husky Energy, Inc. 30,800 813,656 

Imperial Oil Ltd. 30,800 1,404,781 

MEG Energy Corp. * 5,100 200,620 

Nexen, Inc. 30,800 773,394 

Pacific Rubiales Energy Corp. 15,000 366,317 

Penn West Petroleum Ltd. 30,800 436,322 

Suncor Energy, Inc. 95,300 2,975,318 

Talisman Energy, Inc. 61,600 855,165 

TransCanada Corp. 


Alimentation Couche-Tard, Inc., B 

47,300 2,128,105 

17,863,277 

Shares 6,000 304,849 

Loblaw Cos. Ltd. 2,000 70,203 

Shoppers Drug Mart Corp. 


19,400 823,495 

1,198,547 

Saputo, Inc. 


12,200 513,788 

Great-West Lifeco, Inc. 30,800 679,451 

Intact Financial Corp. 2,500 152,252 

Manulife Financial Corp. 123,200 1,378,252 

Power Corp. of Canada 30,800 733,757 

Power Financial Corp. 30,800 775,267 

Sun Life Financial, Inc. 


30,800 718,151 

4,437,130 

Agnico-Eagle Mines Ltd. 5,200 250,871 

Agrium, Inc. 5,000 491,513 

Barrick Gold Corp. 61,600 2,372,616 

Eldorado Gold Corp. 30,800 408,544 

First Quantum Minerals Ltd. 32,100 617,702 

Goldcorp, Inc. 56,300 2,308,822 

IAMGOLD Corp. 12,100 158,047 

Kinross Gold Corp. 61,600 546,807 

Osisko Mining Corp. * 30,800 298,684 

Potash Corp. of Saskatchewan, Inc. 58,300 2,384,342 

Silver Wheaton Corp. 26,900 928,968 

Teck Resources Ltd., Class B 41,700 1,151,044 

Turquoise Hill Resources Ltd. * 33,300 267,250 

Yamana Gold, Inc. 

Media 0.2% 

30,800 526,208 

12,711,418 

Shaw Communications, Inc., B Shares 30,800 629,202 


Security 

Number 

of Shares 

Value 

($) 

Thomson Reuters Corp. 30,800 873,267 

1,502,469 


Valeant Pharmaceuticals International, 

Inc. * 


Brookfield Asset Management, Inc., 

20,800 1,063,765 

Class A 30,800 1,060,218 

Brookfield Office Properties, Inc. 


61,600 1,033,065 

2,093,283 

Canadian Tire Corp. Ltd., Class A 


4,600 332,211 

CGI Group, Inc., A Shares * 25,400 662,508 

Technology Hardware & Equipment 0.0% 

Research In Motion Ltd. * 


32,200 214,373 

BCE, Inc. 

Rogers Communications, Inc., B 

30,800 1,367,641 

Shares 


10,900 439,269 

1,806,910 

Canadian National Railway Co. 30,800 2,815,180 

Canadian Pacific Railway Ltd. 


7,110 587,042 

3,402,222 

Canadian Utilities Ltd., Class A 4,000 275,543 

Fortis, Inc. 11,300 372,029 

TransAlta Corp. 11,000 165,973 

813,545 

68,869,660 

Denmark 1.1% 

Banks 0.1% 

Danske Bank A/S * 


67,280 1,172,264 

FLSmidth & Co. A/S 4,312 242,972 

Rockwool International A/S, B Shares 


924 82,060 

325,032 

Carlsberg A/S, B Shares 8,316 721,663 


Coloplast A/S, B Shares 1,848 369,819 

William Demant Holding A/S * 


1,848 159,744 

529,563 

Novozymes A/S, B Shares 17,864 496,499 


Novo Nordisk A/S, B Shares 


28,336 4,472,213 

AP Moller - Maersk A/S, B Shares 70 458,733 

DSV A/S 15,092 329,081 

787,814 

8,505,048



Security 

Finland 0.6% 

Number 

of Shares 

Value 

($) 


Nokian Renkaat Oyj 


8,624 340,140 

Kone Oyj, B Shares 14,784 906,604 

Wartsila Oyj Abp 


14,784 476,876 

1,383,480 

Kesko Oyj, B Shares 


3,696 98,068 

Sampo Oyj, A Shares 


33,880 974,118 

Stora Enso Oyj, R Shares 47,432 286,982 

UPM-Kymmene Oyj 36,652 406,790 

693,772 


Nokia Oyj 


257,180 732,636 

Fortum Oyj 28,336 524,690 

4,746,904 

France 8.4% 


Compagnie Generale des 

Etablissements Michelin, B Shares 9,660 694,665 

Peugeot S.A. * 9,548 72,392 

Renault S.A. 15,708 735,864 

Valeo S.A. 

Banks 0.6% 

4,928 233,593 

1,736,514 

BNP Paribas S.A. 68,684 2,991,640 

Credit Agricole S.A. * 40,348 235,883 

Natixis 20,944 57,367 

Societe Generale * 


52,360 1,389,295 

4,674,185 

Alstom S.A. 17,864 637,472 

Bouygues S.A. 16,940 422,253 

Compagnie de Saint-Gobain 33,264 1,143,621 

Eiffage S.A. 

European Aeronautic Defence & 

1,232 38,365 

Space Co., N.V. 21,868 835,759 

Legrand S.A. 11,746 406,790 

Rexel S.A. 6,468 126,574 

Safran S.A. 12,628 443,385 

Schneider Electric S.A. 33,264 2,105,269 

Thales S.A. * 4,620 153,857 

Vallourec S.A. 7,392 343,541 

Vinci S.A. 36,344 1,584,624 

Wendel 2,156 162,596 

Zodiac Aerospace 2,464 235,487 

8,639,593 


Bureau Veritas S.A. 4,620 427,154 

Edenred 18,480 494,765 

Security 

Number 

of Shares 

Value 

($) 

Societe BIC S.A. 

Consumer Durables & Apparel 0.6% 

2,772 298,991 

1,220,910 

Christian Dior S.A. 4,312 616,360 

Hermes International 

LVMH Moet Hennessy Louis Vuitton 

2,464 711,090 

S.A. 


21,560 3,527,494 

4,854,944 

Accor S.A. 18,480 587,243 

Sodexo 


11,704 927,514 

1,514,757 

Eurazeo 

Energy 1.0% 

Compagnie Generale De 

2,727 120,257 

Geophysique-Veritas * 10,780 313,412 

Technip S.A. 6,776 715,236 

Total S.A. 


132,132 6,612,962 

7,641,610 

Carrefour S.A. 38,192 802,270 

Casino Guichard Perrachon S.A. 


4,004 356,119 

1,158,389 

Danone S.A. 40,348 2,520,046 

Pernod-Ricard S.A. 15,092 1,629,741 

4,149,787 


bioMerieux 1,232 107,758 

Essilor International S.A. 

Household & Personal Products 0.3% 

14,168 1,239,220 

1,346,978 

L’Oreal S.A. 


16,632 2,049,083 

AXA S.A. 139,849 2,028,979 

CNP Assurances 11,088 134,747 

SCOR SE 


10,780 265,581 

2,429,307 

Air Liquide S.A. 19,005 2,241,065 

Arkema S.A. 3,080 262,757 

Eramet 924 102,494 

Imerys S.A. 2,464 122,030 

Lafarge S.A. 

Media 0.4% 

13,860 662,395 

3,390,741 

Eutelsat Communications 7,700 237,211 

JC Decaux S.A. 3,388 77,468 

Lagardere S.C.A. 8,008 225,552 

Publicis Groupe 8,316 432,553 

SES 20,636 532,199 

Societe Television Francaise 1 9,856 92,307 

Vivendi 81,472 1,601,022 

3,198,312 




Security 

Number 

of Shares 

Value 

($) 


Sanofi 


73,612 6,035,854 

Fonciere Des Regions 2,464 173,618 

Gecina S.A. 1,540 147,898 

Klepierre 5,544 179,317 

Unibail-Rodamco SE 


5,852 1,196,091 

1,696,924 

PPR 6,160 964,373 

Semiconductors & Semiconductor Equipment 0.0% 

STMicroelectronics N.V. 


20,328 120,866 

AtoS 4,004 234,940 

Cap Gemini S.A. 8,932 329,038 

Dassault Systemes S.A. 3,080 299,755 

863,733 


Alcatel-Lucent * 232,848 265,622 

Gemalto N.V. 


4,928 391,402 

657,024 

France Telecom S.A. 


116,116 1,609,275 

Aeroports de Paris 2,464 195,701 

Bollore 616 142,870 

Groupe Eurotunnel S.A. - Reg’d 


26,180 196,679 

535,250 

Electricite de France S.A. 20,944 427,414 

GDF Suez 105,336 2,599,091 

Suez Environnement Co. 25,256 283,651 

Veolia Environnement 32,340 343,075 

3,653,231 

64,261,897 

Germany 6.5% 


Bayerische Motoren Werke AG 18,172 1,320,749 

Continental AG 4,312 429,713 

Daimler AG - Reg’d 65,604 3,225,060 

Volkswagen AG 

Banks 0.1% 

1,540 251,381 

5,226,903 

Commerzbank AG * 


287,056 455,911 

Bilfinger Berger SE 2,156 181,620 

Brenntag AG 616 73,570 

GEA Group AG 13,244 350,575 

Hochtief AG * 4,004 188,053 

MAN SE 8,932 826,170 

Siemens AG - Reg’d 


51,128 4,860,581 

6,480,569 

Adidas AG 14,784 1,159,298 


Security 

Number 

of Shares 

Value 

($) 

Puma SE 


616 179,597 

1,338,895 

Deutsche Bank AG - Reg’d 54,208 1,932,007 

Deutsche Boerse AG 


13,860 715,069 

2,647,076 

Metro AG 


12,320 371,928 

Suedzucker AG 3,696 124,204 


Celesio AG 

Fresenius Medical Care AG & Co. 

5,236 95,931 

KGaA 14,476 1,046,100 

Fresenius SE & Co. KGaA 


8,624 922,040 

2,064,071 

Beiersdorf AG 4,928 354,069 

Henkel AG & Co. KGaA 


8,932 555,396 

909,465 

Allianz SE - Reg’d 

Hannover Rueckversicherung AG - 

24,948 2,744,375 

Reg’d 

Muenchener Rueckversicherungs- 

4,004 245,135 

Gesellschaft AG - Reg’d 


12,628 1,873,501 

4,863,011 

BASF SE 54,208 4,223,427 

HeidelbergCement AG 12,936 655,005 

K+S AG 12,328 604,484 

Lanxess AG 4,928 374,693 

Linde AG 7,700 1,215,658 

Salzgitter AG 3,080 113,597 

ThyssenKrupp AG 24,640 491,970 

Wacker Chemie AG 

Media 0.1% 

1,232 79,355 

7,758,189 

Axel Springer AG 3,696 168,509 

Kabel Deutschland Holding AG * 4,620 306,899 

475,408 


Bayer AG - Reg’d 53,284 4,142,033 

Merck KGaA 4,004 458,978 

QIAGEN N.V. * 


14,476 260,841 

4,861,852 

Fielmann AG 924 84,150 


Infineon Technologies AG 


71,764 497,070 

SAP AG 58,520 3,865,995 

Software AG 


2,156 74,708 

3,940,703 

Deutsche Telekom AG - Reg’d 177,408 2,121,062



Security 

Number 

of Shares 

Value 

($) 


Deutsche Lufthansa AG - Reg’d 13,860 171,386 

Deutsche Post AG - Reg’d 54,208 1,055,344 

Fraport AG 2,772 154,771 

Hamburger Hafen und Logistik AG 


2,772 67,716 

1,449,217 

E.ON AG 124,124 2,860,840 

RWE AG 30,492 1,281,621 

4,142,461 

49,812,145 

Greece 0.1% 

Banks 0.1% 

Alpha Bank AE * 38,141 64,903 

Eurobank Ergasias S.A. * 37,009 31,629 

National Bank of Greece S.A. ADR * 


Coca Cola Hellenic Bottling Co. S.A. 

65,656 111,615 

208,147 

ADR * 


Hellenic Telecommunications 

9,856 180,759 

Organization S.A. * 


38,631 125,632 

Public Power Corp. S.A. * 14,592 48,558 

563,096 



Geely Automobile Holdings Ltd. (c) 210,000 67,417 

Xinyi Glass Holdings Ltd. 

Banks 0.4% 

156,000 71,400 

138,817 

BOC Hong Kong Holdings Ltd. 308,000 974,878 

Dah Sing Banking Group Ltd. 260,160 238,148 

Hang Seng Bank Ltd. 61,600 876,795 

The Bank of East Asia Ltd. (c) 


184,800 673,083 

2,762,904 

Hutchison Whampoa Ltd. 218,000 1,907,017 

Jardine Matheson Holdings Ltd. 11,000 592,020 

Jardine Strategic Holdings Ltd. 5,000 166,200 

Johnson Electric Holdings Ltd. 

Melco International Development 

322,000 188,893 

Ltd. (c) 81,000 65,583 

Shun Tak Holdings Ltd. 


178,000 64,487 

2,984,200 

Hutchison Harbour Ring Ltd. 814,000 65,068 

Techtronic Industries Co., Ltd. 154,000 233,891 

Texwinca Holdings Ltd. 12,000 9,762 

Yue Yuen Industrial Holdings Ltd. 40,000 115,520 

424,241 

Security 

Number 

of Shares 

Value 

($) 


Cafe de Coral Holdings Ltd. 

China Travel International Investment 

10,000 27,913 

Hong Kong Ltd. 616,000 105,628 

Galaxy Entertainment Group Ltd. *(c) 140,000 398,001 

Sands China Ltd. 123,200 435,221 

SJM Holdings Ltd. 49,000 103,228 

Wynn Macau Ltd. 


80,000 183,594 

1,253,585 

First Pacific Co., Ltd. 

Hong Kong Exchanges & Clearing 

12,000 12,872 

Ltd. (c) 

Energy 0.0% 

83,200 1,104,864 

1,117,736 

Brightoil Petroleum Holdings Ltd. (c) 


308,000 55,594 

China Huiyuan Juice Group Ltd. *(c) 154,000 46,262 

China Mengniu Dairy Co., Ltd. 74,000 222,775 

China Yurun Food Group Ltd. *(c) 15,000 9,167 

Tingyi Cayman Islands Holding Corp. 28,000 82,850 

Want Want China Holdings Ltd. 616,000 762,430 

1,123,484 


Hengan International Group Co., Ltd. 


99,500 1,000,612 

AIA Group Ltd. 


753,400 2,588,636 

China Zhongwang Holdings Ltd. * 123,200 49,876 

Fosun International 

Hidili Industry International 

154,000 72,669 

Development Ltd. (c) 

Huabao International Holdings 

125,000 26,753 

Ltd. (c) 175,000 89,798 

Lee & Man Paper Manufacturing Ltd. 165,000 67,649 

Mongolian Mining Corp. * 100,000 46,285 

Nine Dragons Paper Holdings Ltd. (c) 

Shougang Fushan Resources Group 

62,000 27,897 

Ltd. (c) 140,000 36,822 

United Co. RUSAL plc *(c) 

Media 0.0% 

20,000 10,830 

428,579 

Television Broadcasts Ltd. 


24,000 173,280 

Agile Property Holdings Ltd. (c) 30,000 34,424 

Cheung Kong (Holdings) Ltd. 

Evergrande Real Estate Group 

102,000 1,387,397 

Ltd. (c) 145,000 55,336 

Hang Lung Group Ltd. 50,000 312,006 

Hang Lung Properties Ltd. 

Henderson Land Development Co., 

137,000 468,074 

Ltd. 70,000 430,492 

Hongkong Land Holdings Ltd. 219,000 1,335,900 

Hopewell Holdings Ltd. 154,000 493,396 

Hysan Development Co., Ltd. 31,000 139,088 

Kerry Properties Ltd. 43,000 204,293 

Kowloon Development Co., Ltd. 25,000 24,625 

New World Development Co., Ltd. 433,000 538,162 

Sino Land Co., Ltd. 105,000 171,926 




Security 

Number 

of Shares 

Value 

($) 

Sun Hung Kai Properties Ltd. 120,000 1,556,422 

Swire Pacific Ltd., Class A 52,000 614,446 

Swire Properties Ltd. 36,000 103,040 

The Link REIT 154,000 686,982 

Wharf Holdings Ltd. 93,000 572,538 

Wheelock & Co., Ltd. 


30,000 114,295 

9,242,842 

Belle International Holdings Ltd. 

Chow Tai Fook Jewellery Group 

308,000 555,939 

Ltd. (c) 30,000 35,894 

Esprit Holdings Ltd. (c) 61,600 94,192 

Golden Eagle Retail Group Ltd. (c) 

GOME Electrical Appliances Holdings 

20,000 36,667 

Ltd. 1,232,000 106,423 

L’Occitane International S.A. 15,500 39,568 

Li & Fung Ltd. 294,000 477,602 

Lifestyle International Holdings Ltd. 154,000 336,740 

Parkson Retail Group Ltd. 308,000 250,172 

1,933,197 


ASM Pacific Technology Ltd. (c) 24,400 271,802 

GCL- Poly Energy Holdings Ltd. (c) 


401,000 61,523 

333,325 

Tencent Holdings Ltd. 55,300 1,689,747 


AAC Technologies Holdings, Inc. 68,000 231,014 

Foxconn International Holdings Ltd. * 97,000 30,515 

Kingboard Chemical Holdings Ltd. 47,000 102,771 

VTech Holdings Ltd. 


10,900 133,224 

497,524 

PCCW Ltd. 


308,000 118,336 

Cathay Pacific Airways Ltd. 

Hopewell Highway Infrastructure 

62,000 101,038 

Ltd. (c) 


Cheung Kong Infrastructure Holdings 

1,781,000 902,412 

1,003,450 

Ltd. 22,000 133,028 

CLP Holdings Ltd. 104,500 871,030 

ENN Energy Holdings Ltd. 40,000 157,808 

Hong Kong & China Gas Co., Ltd. 477,000 1,124,198 

Power Assets Holdings Ltd. 92,500 749,541 

3,035,605 

31,905,694 

Ireland 0.1% 


Kerry Group plc, A Shares 9,548 458,423 


Elan Corp. plc * 43,428 498,417 


Security 

Number 

of Shares 

Value 

($) 


Ryanair Holdings plc * 11,021 58,068 

1,014,908 

Israel 0.5% 

Banks 0.1% 

Bank Hapoalim B.M. 70,224 216,068 

Bank Leumi Le-Israel * 60,060 137,661 

First International Bank of Israel Ltd. * 8,316 85,691 

Israel Discount Bank, A Shares * 56,370 58,914 

Mizrahi Tefahot Bank Ltd. * 


6,776 52,586 

550,920 

Delek Group Ltd. 308 44,897 

Elbit Systems Ltd. 924 28,707 

Ormat Industries Ltd. 

Energy 0.0% 

2,156 10,324 

83,928 

Avner Oil Exploration LP * 80,080 40,201 

Delek Drilling - LP * 14,784 41,178 

Isramco Negev 2 LP * 598,203 71,984 

Oil Refineries Ltd. * 49,280 18,539 

Ratio Oil Exploration 1992 LP * 


480,480 33,039 

204,941 

Osem Investments Ltd. 4,004 49,070 

Strauss Group Ltd. * 


Migdal Insurance & Financial Holding 

1,232 11,424 

60,494 

Ltd. 


25,256 25,672 

Israel Chemicals Ltd. 31,416 338,905 

The Israel Corp., Ltd. 196 112,457 

451,362 


Teva Pharmaceutical Industries Ltd. 


58,362 2,327,879 

Azrieli Group 2,464 45,746 

Gazit-Globe Ltd. 4,620 44,498 

Jerusalem Economy Ltd. * 


8,008 28,929 

119,173 

NICE Systems Ltd. * 


Bezeq Israeli Telecommunication 

3,080 96,685 

Corp., Ltd. 113,960 129,466 

4,050,520 

Italy 2.0% 


Fiat S.p.A. * 40,040 218,638 

Pirelli & C. S.p.A. 29,619 326,679 

545,317



Security 

Number 

of Shares 

Value 

($) 

Banks 0.4% 

Banca Carige S.p.A. 

Banca Monte dei Paschi di Siena 

65,912 53,256 

S.p.A. * 

Banco Popolare Societa 

308,000 86,964 

Cooperativa * 92,400 135,105 

Intesa Sanpaolo S.p.A. 749,364 1,180,717 

UniCredit S.p.A. * 287,672 1,141,498 

Unione di Banche Italiane S.c.p.A. 


43,428 146,049 

2,743,589 

Fiat Industrial S.p.A. 54,516 550,083 

Finmeccanica S.p.A. * 7,084 31,503 

Prysmian S.p.A. 


2,156 36,172 

617,758 

Luxottica Group S.p.A. 


8,316 303,987 

Autogrill S.p.A. 


14,168 121,082 

EXOR S.p.A. 5,852 140,078 

Mediobanca S.p.A. 

Energy 0.7% 

36,036 169,066 

309,144 

Eni S.p.A. 162,008 3,598,199 

Saipem S.p.A. 21,560 1,025,909 

Tenaris S.A. 


28,336 591,125 

5,215,233 

Parmalat S.p.A. 


72,380 157,745 

Assicurazioni Generali S.p.A. 


101,948 1,457,252 

Buzzi Unicem S.p.A. 

Media 0.0% 

4,928 51,154 

Mediaset S.p.A. 


51,128 102,728 

Telecom Italia S.p.A. 773,080 721,106 

Telecom Italia S.p.A. - RSP 


399,168 316,734 

1,037,840 

Atlantia S.p.A. 


31,262 440,162 

A2A S.p.A. 78,232 41,732 

Enel Green Power S.p.A. 31,108 51,250 

Enel S.p.A. 470,624 1,554,240 

Snam S.p.A. 105,028 442,705 

Terna-Rete Elettrica Nazionale S.p.A. 96,404 335,631 

2,425,558 

15,528,549 

Japan 16.2% 


Aisin Seiki Co., Ltd. 2,200 69,962 

Bridgestone Corp. 30,800 713,946 

Denso Corp. 30,800 1,026,667 

Security 

Number 

of Shares 

Value 

($) 

Honda Motor Co., Ltd. 92,400 2,917,149 

Isuzu Motors Ltd. 36,000 183,448 

Mitsubishi Motors Corp. * 616,000 574,304 

NHK Spring Co., Ltd. 5,000 49,234 

Nissan Motor Co., Ltd. 154,000 1,435,760 

Nok Corp. 30,800 515,300 

Sumitomo Rubber Industries Ltd. 30,800 375,658 

Suzuki Motor Corp. 30,800 561,717 

Toyota Motor Corp. 148,700 5,877,733 

Yamaha Motor Co., Ltd. 

Banks 1.8% 

30,800 266,697 

14,567,575 

Aozora Bank Ltd. 308,000 916,526 

Fukuoka Financial Group, Inc. 27,000 106,207 

Hokuhoku Financial Group, Inc. 308,000 464,164 

Mitsubishi UFJ Financial Group, Inc. 862,400 3,921,001 

Mizuho Financial Group, Inc. 1,395,700 2,245,954 

Resona Holdings, Inc. 154,000 599,872 

Sapporo Hokuyo Holdings, Inc. 61,600 157,344 

Senshu Ikeda Holdings, Inc. 49,280 286,365 

Shinsei Bank Ltd. 318,000 369,579 

Sumitomo Mitsui Financial Group, Inc. 92,400 2,860,506 

Sumitomo Mitsui Trust Holdings, Inc. 241,000 670,983 

The 77 Bank Ltd. 28,000 106,922 

The Awa Bank Ltd. 5,000 30,843 

The Bank of Yokohama Ltd. 62,000 287,433 

The Chiba Bank Ltd. 45,000 260,345 

The Hokkoku Bank Ltd. 2,000 7,637 

The Joyo Bank Ltd. 37,000 177,676 

The Juroku Bank Ltd. 20,000 66,411 

The Nanto Bank Ltd. 4,000 18,442 

The San-In Godo Bank Ltd. 2,000 14,381 

The Shiga Bank Ltd. 8,000 48,633 

The Shizuoka Bank Ltd. 20,000 207,663 

Yamaguchi Financial Group, Inc. 


9,000 75,172 

13,900,059 

Chiyoda Corp. 1,000 13,155 

COMSYS Holdings Corp. 30,800 393,359 

Daikin Industries Ltd. 30,800 820,153 

FANUC Corp. 12,090 1,974,854 

Hitachi Cable Ltd. * 7,000 9,655 

Hoshizaki Electric Co., Ltd. 1,600 44,751 

IHI Corp. 308,000 660,843 

ITOCHU Corp. 61,600 624,654 

JTEKT Corp. 30,800 241,129 

Kandenko Co., Ltd. 2,000 9,757 

Kawasaki Heavy Industries Ltd. 308,000 652,976 

Keihan Electric Railway Co., Ltd. 8,000 38,825 

Komatsu Ltd. 61,600 1,211,545 

LIXIL Group Corp. 30,800 661,236 

Mitsubishi Corp. 92,400 1,698,130 

Mitsubishi Electric Corp. 34,000 276,169 

Mitsubishi Heavy Industries Ltd. 308,000 1,274,483 

Mitsui & Co., Ltd. 92,400 1,289,824 

SMC Corp. 2,000 313,921 

Sojitz Corp. 154,000 206,513 

Sumitomo Corp. 92,400 1,222,559 

Sumitomo Electric Industries Ltd. 61,600 692,312 

The Japan Steel Works Ltd. 1,000 5,338 

THK Co., Ltd. 30,800 480,685 




Security 

Number 

of Shares 

Value 

($) 

Toyota Tsusho Corp. 30,800 628,588 

Ushio, Inc. 30,800 361,890 

15,807,304 


Kokuyo Co., Ltd. 9,300 71,858 

Nissha Printing Co., Ltd. * 3,200 30,692 

Secom Co., Ltd. 


30,800 1,555,735 

1,658,285 

Haseko Corp. * 164,000 102,631 

Makita Corp. 25,400 864,184 

NAMCO BANDAI Holdings, Inc. 30,800 487,765 

Nikon Corp. 30,800 846,508 

Panasonic Corp. 184,800 1,255,602 

Sega Sammy Holdings, Inc. 30,800 636,061 

Sony Corp. 72,600 816,866 

Sumitomo Forestry Co., Ltd. 30,800 255,290 

TSI Holdings Co., Ltd. 


33,800 215,405 

5,480,312 

Benesse Holdings, Inc. 2,000 98,978 

Oriental Land Co., Ltd. 


2,000 269,732 

368,710 

Acom Co., Ltd. * 400 9,241 

Credit Saison Co., Ltd. 30,800 720,240 

Daiwa Securities Group, Inc. 

Mitsubishi UFJ Lease & Finance Co., 

130,000 469,859 

Ltd. 6,160 264,731 

Nomura Holdings, Inc. 257,300 847,808 

ORIX Corp. 

Energy 0.3% 

6,160 569,584 

2,881,463 

Cosmo Oil Co., Ltd. 30,000 57,471 

Idemitsu Kosan Co., Ltd. 1,000 80,332 

Inpex Corp. 155 880,907 

JX Holdings, Inc. 126,600 654,827 

Showa Shell Sekiyu K.K. 30,800 158,524 

TonenGeneral Sekiyu K.K. 


15,000 126,820 

1,958,881 

Aeon Co., Ltd. 61,600 708,046 

Seven & i Holdings Co., Ltd. 


61,600 1,868,455 

2,576,501 

Ajinomoto Co., Inc. 27,000 411,379 

Asahi Group Holdings Ltd. 30,800 745,415 

Japan Tobacco, Inc. 61,600 1,857,441 

Kagome Co., Ltd. 30,800 698,212 

Kewpie Corp. 30,800 476,357 

Kirin Holdings Co., Ltd. 35,000 435,824 

Nissin Foods Holdings Co., Ltd. 6,000 231,801 

Sapporo Holdings Ltd. 10,000 28,480 

Yakult Honsha Co., Ltd. 9,000 386,207 

5,271,116 


Alfresa Holdings Corp. 1,900 93,787 


Security 

Number 

of Shares 

Value 

($) 

M3, Inc. 32 169,400 

Medipal Holdings Corp. 14,400 206,161 

Miraca Holdings, Inc. 2,100 94,004 

Olympus Corp. * 22,300 440,019 

Suzuken Co., Ltd. 2,100 71,099 

Terumo Corp. 


6,100 269,942 

1,344,412 

Kao Corp. 30,800 929,900 

Kobayashi Pharmaceutical Co., Ltd. 1,300 69,483 

Lion Corp. 11,000 64,061 

Shiseido Co., Ltd. 14,200 202,210 

Unicharm Corp. 


6,200 360,677 

1,626,331 

Sony Financial Holdings, Inc. 55,200 908,015 

T&D Holdings, Inc. 61,600 623,081 

The Dai-ichi Life Insurance Co., Ltd. 449 457,028 

Tokio Marine Holdings, Inc. 


61,600 1,474,309 

3,462,433 

Asahi Kasei Corp. 60,000 311,877 

Hitachi Chemical Co., Ltd. 30,800 440,562 

JFE Holdings, Inc. 33,900 427,755 

JSR Corp. 30,800 523,167 

Kobe Steel Ltd. 308,000 236,015 

Kuraray Co. Ltd. 30,800 355,203 

Mitsubishi Chemical Holdings Corp. 154,000 595,939 

Nippon Paper Group, Inc. (c) 5,200 61,430 

Nippon Steel Corp. 308,000 593,972 

Nissan Chemical Industries Ltd. 11,200 124,302 

Nitto Denko Corp. 20,100 927,989 

Shin-Etsu Chemical Co., Ltd. 30,800 1,646,207 

Showa Denko K.K. 308,000 519,234 

Sumitomo Chemical Co., Ltd. 20,000 52,107 

Sumitomo Metal Industries Ltd. 308,000 436,628 

Sumitomo Metal Mining Co., Ltd. 22,000 227,024 

Sumitomo Osaka Cement Co., Ltd. 37,000 120,026 

Taiheiyo Cement Corp. 32,000 69,068 

Tokyo Steel Manufacturing Co., Ltd. 45,200 147,203 

Toray Industries, Inc. 

Media 0.2% 

50,000 305,236 

8,120,944 

Dentsu, Inc. 28,400 721,063 

Hakuhodo DY Holdings, Inc. 6,160 403,586 

SKY Perfect JSAT Holdings, Inc. 131 58,557 

1,183,206 


Astellas Pharma, Inc. 30,800 1,502,631 

Chugai Pharmaceutical Co., Ltd. 30,800 613,640 

Daiichi Sankyo Co., Ltd. 30,800 507,433 

Dainippon Sumitomo Pharma Co., Ltd. 30,800 339,862 

Eisai Co., Ltd. 30,800 1,406,258 

Kissei Pharmaceutical Co., Ltd. 1,700 29,592 

Otsuka Holdings Co., Ltd. 30,800 939,341 

Shionogi & Co., Ltd. 30,800 443,709 

Takeda Pharmaceutical Co., Ltd. 30,800 1,443,627 

7,226,093



Security 

Number 

of Shares 

Value 

($) 


Aeon Mall Co., Ltd. 7,500 175,000 

Daito Trust Construction Co., Ltd. 3,800 370,779 

Daiwa House Industry Co., Ltd. 22,000 306,258 

Mitsubishi Estate Co., Ltd. 54,000 946,896 

Mitsui Fudosan Co., Ltd. 45,000 835,057 

Nomura Real Estate Holdings, Inc. 6,500 108,167 

NTT Urban Development Corp. 308 233,262 

Sumitomo Real Estate Sales Co., Ltd. 

Sumitomo Realty & Development Co., 

3,080 149,083 

Ltd. 30,000 731,418 

Tokyo Tatemono Co., Ltd. * 1,000 3,308 

Tokyu Land Corp. 


32,000 156,935 

4,016,163 

Aoyama Trading Co., Ltd. 4,100 80,481 

DeNA Co., Ltd. 1,900 52,899 

Fast Retailing Co., Ltd. 3,000 700,000 

Isetan Mitsukoshi Holdings Ltd. 61,600 641,962 

J Front Retailing Co., Ltd. 34,000 169,783 

Komeri Co., Ltd. 1,000 25,249 

Marui Group Co., Ltd. 30,800 225,395 

Point, Inc. 3,080 110,376 

USS Co., Ltd. 3,080 330,815 

Yamada Denki Co., Ltd. 12,320 593,185 

2,930,145 


Tokyo Electron Ltd. 19,400 910,536 

Ulvac, Inc. * 


9,600 77,119 

987,655 

Gree, Inc. (c) 1,700 28,268 

KONAMI Corp. 24,500 562,280 

Nintendo Co., Ltd. 4,500 503,448 

Nomura Research Institute Ltd. 30,800 643,142 

NTT Data Corp. 100 298,084 

Trend Micro, Inc. 2,800 77,599 

Yahoo! Japan Corp. 924 317,795 

2,430,616 


Alps Electric Co., Ltd. 30,800 164,031 

Brother Industries Ltd. 30,800 311,934 

Canon, Inc. 83,900 2,780,594 

FUJIFILM Holdings Corp. 30,800 510,973 

Fujitsu Ltd. 71,000 288,353 

Hamamatsu Photonics K.K. 2,100 74,264 

Hitachi Ltd. 308,000 1,766,181 

Hoya Corp. 30,800 694,672 

Keyence Corp. 2,100 553,027 

Konica Minolta Holdings, Inc. 10,000 73,946 

Kyocera Corp. 10,500 901,149 

Murata Manufacturing Co., Ltd. 28,200 1,390,192 

NEC Corp. * 82,000 117,292 

Nippon Electric Glass Co., Ltd. 10,000 47,510 

OMRON Corp. 30,800 601,052 

Ricoh Co., Ltd. 15,000 118,008 

Seiko Epson Corp. 5,200 33,338 

Taiyo Yuden Co., Ltd. 3,300 28,617 

Toshiba Corp. 125,000 399,106 

Security 

Number 

of Shares 

Value 

($) 

Yokogawa Electric Corp. 


10,000 116,603 

10,970,842 

KDDI Corp. 174 1,244,445 

Nippon Telegraph & Telephone Corp. 30,800 1,421,992 

NTT DoCoMo, Inc. 1,024 1,741,977 

SOFTBANK Corp. 


44,700 1,821,111 

6,229,525 

All Nippon Airways Co., Ltd. (c) 308,000 680,511 

Central Japan Railway Co. 152 1,321,992 

East Japan Railway Co. 30,800 2,061,200 

Fukuyama Transporting Co., Ltd. 2,000 11,162 

Kawasaki Kisen Kaisha Ltd. * 6,000 8,046 

Kintetsu Corp. 7,000 28,787 

Nishi-Nippon Railroad Co., Ltd. 15,000 63,985 

Sotetsu Holdings, Inc. 4,000 13,742 

Tobu Railway Co., Ltd. 10,000 55,556 

Tokyu Corp. 192,000 944,061 

West Japan Railway Co. 


30,800 1,347,254 

6,536,296 

Chubu Electric Power Co., Inc. 37,000 439,464 

Electric Power Development Co., Ltd. 11,000 262,848 

Hokkaido Electric Power Co., Inc. 3,000 23,065 

Hokuriku Electric Power Co. 2,000 23,091 

Kyushu Electric Power Co., Inc. 30,800 233,262 

Osaka Gas Co., Ltd. 92,000 401,839 

Shikoku Electric Power Co., Inc. 8,500 103,238 

The Chugoku Electric Power Co., Inc. 31,400 396,209 

The Kansai Electric Power Co., Inc. 31,600 235,688 

The Tokyo Electric Power Co., Inc. * 92,400 154,590 

Toho Gas Co., Ltd. 22,000 143,576 

Tohoku Electric Power Co., Inc. * 17,600 122,953 

Tokyo Gas Co., Ltd. 100,000 551,724 

3,091,547 

124,626,414 

Netherlands 2.2% 


Koninklijke Boskalis Westminster N.V. 2,464 83,455 

Koninklijke Philips Electronics N.V. 67,144 1,547,128 

1,630,583 


Randstad Holding N.V. 


8,932 291,039 

ING Groep N.V. CVA * 

Energy 0.1% 

223,916 1,716,621 

Fugro N.V. CVA 5,236 319,241 

SBM Offshore N.V. * 


10,164 144,004 

463,245 

Koninklijke Ahold N.V. 


73,920 915,922 

DE Master Blenders 1753 N.V. * 47,740 563,490 

Heineken Holding N.V. 6,776 314,229 

Heineken N.V. 16,940 941,128 




Security 

Number 

of Shares 

Value 

($) 

Unilever N.V. CVA 


94,556 3,305,079 

5,123,926 

AEGON N.V. 


124,124 638,819 

Akzo Nobel N.V. 14,168 818,289 

ArcelorMittal 77,616 1,159,833 

Koninklijke DSM N.V. 

Media 0.1% 

11,396 535,586 

2,513,708 

Reed Elsevier N.V. 42,812 560,151 

Wolters Kluwer N.V. 


18,480 333,105 

893,256 

Corio N.V. 4,997 213,212 


ASML Holding N.V. 


26,180 1,486,150 

Koninklijke (Royal) KPN N.V. 


97,944 841,986 

Koninklijke Vopak N.V. 1,540 99,000 

PostNL N.V. 21,413 76,898 

TNT Express N.V. 27,720 312,792 

488,690 

17,217,157 

New Zealand 0.1% 


SKYCITY Entertainment Group Ltd. 57,288 174,435 


Fisher & Paykel Healthcare Corp., 

Ltd. 


19,096 32,985 

Kiwi Income Property Trust 


157,080 138,187 

Chorus Ltd. * 28,644 77,552 

Telecom Corp. of New Zealand Ltd. 


122,584 242,271 

319,823 

Auckland International Airport Ltd. 178,640 373,150 

1,038,580 

Norway 0.9% 

Banks 0.1% 

DnB A.S.A. 


71,456 821,574 

Orkla A.S.A. 

Energy 0.5% 

61,600 455,367 

Aker Solutions A.S.A. 6,468 118,138 

Kvaerner A.S.A. 16,016 39,401 

Seadrill Ltd. 21,560 886,965 

Statoil A.S.A. 86,240 2,215,367 

Subsea 7 S.A. 12,628 290,384 

3,550,255 


Security 

Number 

of Shares 

Value 

($) 


Gjensidige Forsikring A.S.A. 6,160 79,120 

Storebrand A.S.A. * 


23,657 99,937 

179,057 

Norsk Hydro A.S.A. 61,689 264,435 

Yara International A.S.A. 


15,400 753,982 

1,018,417 

Telenor A.S.A. 55,132 1,007,938 

7,032,608 

Portugal 0.2% 

Banks 0.0% 

Banco Comercial Portugues S.A. - 

Reg’d * 322,784 35,398 

Banco Espirito Santo S.A. - Reg’d * 

Energy 0.0% 

22,019 15,376 

50,774 

Galp Energia, SGPS, S.A. 


20,944 315,347 

Jeronimo Martins, SGPS, S.A. 


20,944 350,591 

Portugal Telecom, SGPS, S.A. - Reg’d 


35,112 171,723 

EDP - Energias de Portugal S.A. 217,756 531,945 

1,420,380 



Halla Climate Control Corp. 250 5,310 

Hankook Tire Co., Ltd. (a)(b) 5,820 213,385 

Hyundai Mobis 4,316 1,169,699 

Hyundai Motor Co. 11,262 2,387,142 

Hyundai Wia Corp. 322 51,083 

Kia Motors Corp. 

Banks 0.3% 

21,068 1,375,908 

5,202,527 

BS Financial Group, Inc. 4,800 49,919 

DGB Financial Group, Inc. 1,200 13,855 

Hana Financial Group, Inc. 8,880 265,314 

Industrial Bank of Korea 3,300 35,047 

KB Financial Group, Inc. ADR 

Shinhan Financial Group Co., Ltd. 

32,360 1,047,170 

ADR 18,236 1,146,315 

Woori Finance Holdings Co., Ltd. 


7,200 68,534 

2,626,154 

CJ Corp. 1,000 71,918 

Daelim Industrial Co., Ltd. 

Daewoo Engineering & Construction 

1,800 140,875 

Co., Ltd. * 7,000 61,694 

Daewoo International Corp. 

Daewoo Shipbuilding & Marine 

1,690 51,164 

Engineering Co., Ltd. 4,930 105,802 

Doosan Corp. 1,746 208,512



Security 

Number 

of Shares 

Value 

($) 

Doosan Heavy Industries & 

Construction Co., Ltd. 2,150 112,178 

Doosan Infracore Co., Ltd. * 4,610 71,915 

GS Engineering & Construction Corp. 2,000 123,741 

Hyundai Development Co. 

Hyundai Engineering & Construction 

4,000 73,505 

Co., Ltd. 5,409 302,241 

Hyundai Heavy Industries Co., Ltd. 4,038 823,882 

Hyundai Mipo Dockyard Co., Ltd. 620 66,938 

KCC Corp. 300 74,827 

LG Corp. 5,536 305,435 

LS Corp. 1,683 130,235 

Samsung C&T Corp. 10,000 568,470 

Samsung Engineering Co., Ltd. 2,432 412,612 

Samsung Heavy Industries Co., Ltd. 14,240 466,247 

Samsung Techwin Co., Ltd. 3,201 200,869 

SK Holdings Co., Ltd. 2,020 297,314 

STX Offshore & Shipbuilding Co., Ltd. 


3,100 26,010 

4,696,384 

LG Electronics, Inc. 6,330 392,757 

Woongjin Coway Co., Ltd. 


4,500 155,668 

548,425 

Kangwon Land, Inc. 


7,430 151,923 

Daewoo Securities Co., Ltd. 20,008 198,383 

Hyundai Securities Co., Ltd. 9,000 67,265 

Korea Investment Holdings Co., Ltd. 2,650 89,102 

Samsung Card Co., Ltd. 2,960 93,786 

Samsung Securities Co., Ltd. 

Woori Investment & Securities Co., 

3,836 164,140 

Ltd. 

Energy 0.2% 

5,000 48,915 

661,591 

GS Holdings 2,180 124,887 

S-Oil Corp. 6,110 554,659 

SK Innovation Co., Ltd. 


4,815 693,844 

1,373,390 

E-Mart Co., Ltd. 1,147 249,694 

Shinsegae Co., Ltd. 


352 70,113 

319,807 

CJ CheilJedang Corp. 500 134,846 

KT&G Corp. 3,506 265,432 

Lotte Chilsung Beverage Co., Ltd. 55 67,767 

Lotte Confectionery Co., Ltd. 50 71,565 

NongShim Co., Ltd. 270 59,491 

ORION Corp. 


264 214,062 

813,163 

Amorepacific Corp. 203 209,150 

AMOREPACIFIC Group 700 267,754 

LG Household & Health Care Ltd. 


620 339,883 

816,787 

Dongbu Insurance Co., Ltd. 3,650 149,104 

Security 

Number 

of Shares 

Value 

($) 

Hyundai Marine & Fire Insurance Co., 

Ltd. 6,000 172,921 

Korea Life Insurance Co., Ltd. 

Samsung Fire & Marine Insurance 

20,000 125,151 

Co., Ltd. 2,930 604,270 

Samsung Life Insurance Co., Ltd. 


5,624 478,322 

1,529,768 

Cheil Industries, Inc. 3,550 323,829 

Hanwha Chemical Corp. 5,040 92,838 

Hanwha Corp. 4,090 118,775 

Honam Petrochemical Corp. 1,026 211,598 

Hyosung Corp. 1,350 72,222 

Hyundai Steel Co. 2,037 150,088 

Korea Zinc Co., Ltd. 611 220,248 

Kumho Petro Chemical Co., Ltd. 828 82,098 

LG Chem Ltd. 3,595 953,703 

OCI Co., Ltd. 1,338 224,056 

POSCO ADR 24,212 1,973,278 

4,422,733 


Celltrion, Inc. 4,633 123,111 

Yuhan Corp. 


434 51,256 

174,367 

Hyundai Department Store Co., Ltd. 1,016 127,601 

Lotte Midopa Co., Ltd. 5,500 64,471 

Lotte Shopping Co., Ltd. 582 163,886 

355,958 


Samsung Electronics Co., Ltd. GDR - 

Reg’d 17,950 9,836,600 

SK Hynix, Inc. * 


33,220 620,702 

10,457,302 

Daum Communications Corp. 376 37,546 

NCsoft Corp. 1,050 233,667 

NHN Corp. 3,259 745,366 

SK C&C Co. Ltd. 1,000 96,508 

1,113,087 


LG Display Co., Ltd. ADR * 46,604 548,063 

Samsung Electro-Mechanics Co., Ltd. 2,664 228,452 

Samsung SDI Co., Ltd. 


1,000 126,033 

902,548 

KT Corp. ADR 21,252 321,118 

LG Uplus Corp. 12,400 83,058 

SK Telecom Co., Ltd. ADR 


34,804 499,089 

903,265 

CJ Korea Express Co., Ltd. * 1,164 95,921 

Hanjin Shipping Co., Ltd. * 4,500 57,905 

Hyundai Glovis Co., Ltd. 500 100,474 

Hyundai Merchant Marine Co., Ltd. * 3,567 86,139 

Korean Air Lines Co., Ltd. * 2,299 96,245 

436,684 




Security 

Number 

of Shares 

Value 

($) 


Korea Electric Power Corp. ADR * 75,072 804,021 

38,309,884 

Singapore 1.7% 

Banks 0.5% 

DBS Group Holdings Ltd. 61,000 706,630 

Oversea-Chinese Banking Corp., Ltd. 308,000 2,293,827 

United Overseas Bank Ltd. 


30,000 459,115 

3,459,572 

Cosco Corp. Singapore Ltd. (c) 28,000 21,773 

Fraser and Neave Ltd. 39,000 256,686 

Keppel Corp., Ltd. 48,000 430,592 

Noble Group Ltd. 

Singapore Technologies Engineering 

358,181 344,571 

Ltd. 308,000 841,975 

Yangzijiang Shipbuilding Holdings Ltd. 


355,000 280,323 

2,175,920 

Genting Singapore plc 


308,000 337,037 

Singapore Exchange Ltd. 


8,000 45,150 

Olam International Ltd. (c) 


154,772 238,225 

Golden Agri-Resources Ltd. 616,000 350,617 

Indofood Agri Resources Ltd. (c) 37,000 41,378 

Wilmar International Ltd. 

Media 0.0% 

266,000 667,453 

1,059,448 

Singapore Press Holdings Ltd. (c) 


24,000 76,383 

CapitaCommercial Trust 308,000 350,617 

Capitaland Ltd. 308,000 743,210 

CapitaMall Trust 308,000 488,889 

Keppel Land Ltd. 33,000 89,682 

Wing Tai Holdings Ltd. 443,000 543,362 

Yanlord Land Group Ltd. *(c) 


388,000 362,370 

2,578,130 

Jardine Cycle & Carriage Ltd. 8,000 296,873 


Venture Corp., Ltd. 


23,000 143,082 

Singapore Telecommunications Ltd. 


616,000 1,674,074 

ComfortDelGro Corp., Ltd. 308,000 413,580 

Hutchison Port Holdings Trust 95,000 66,500 

Neptune Orient Lines Ltd. *(c) 335,000 292,729 

Singapore Post Ltd. 308,000 266,667 

1,039,476 

13,123,370 


Security 

Spain 2.4% 

Number 

of Shares 

Value 

($) 

Banks 0.9% 

Banco Bilbao Vizcaya Argentaria S.A. 298,144 2,282,297 

Banco de Sabadell S.A. 206,360 598,269 

Banco Popular Espanol S.A. (c) 73,961 169,022 

Banco Santander S.A. 563,024 4,023,952 

Bankinter S.A. 


ACS, Actividades de Construccion y 

21,252 80,204 

7,153,744 

Servicios S.A. 12,320 245,209 

Zardoya Otis S.A. 


9,286 107,803 

353,012 

CaixaBank (c) 82,544 315,470 

Corporacion Financiera Alba S.A. 

Energy 0.2% 

2,464 80,038 

395,508 

Repsol S.A. 


Distribuidora Internacional de 

73,612 1,357,951 

Alimentacion S.A. * 


33,880 180,261 

Mapfre S.A. 


45,584 110,895 

Acerinox S.A. 14,784 158,660 


Grifols S.A. * 


14,784 417,429 

Inditex S.A. 


15,708 1,750,512 

Amadeus IT Holding S.A. 


24,024 537,813 

Telefonica S.A. 


265,496 3,359,963 

Abertis Infraestructuras S.A. 23,100 314,324 

Ferrovial S.A. 


31,108 368,001 

682,325 

Enagas S.A. 13,860 257,952 

Gas Natural SDG S.A. 32,956 407,352 

Iberdrola S.A. 293,524 1,166,939 

Red Electrica Corporacion S.A. 1,540 66,815 

1,899,058 

18,357,131 

Sweden 2.7% 

Banks 0.6% 

Nordea Bank AB 196,504 1,817,654 

Skandinaviska Enskilda Banken AB, 

A Shares 131,516 1,006,979 

Svenska Handelsbanken AB, A 

Shares 36,652 1,278,072



Security 

Number 

of Shares 

Value 

($) 

Swedbank AB, A Shares 


41,580 727,783 

4,830,488 

Alfa Laval AB 21,868 374,504 

Assa Abloy AB, B Shares 29,568 904,234 

Atlas Copco AB, A Shares 44,660 999,541 

Atlas Copco AB, B Shares 26,796 530,930 

Hexagon AB, B Shares 15,092 303,132 

Sandvik AB 57,288 766,534 

Scania AB, B Shares 26,488 456,024 

Skanska AB, B Shares 26,796 412,766 

SKF AB, B Shares 32,956 685,832 

Volvo AB, B Shares 90,552 1,148,028 

6,581,525 


Securitas AB, B Shares 


30,492 227,298 

Electrolux AB, Series B 


12,320 298,434 

Industrivarden AB, A Shares 17,864 251,302 

Investment AB Kinnevik, B Shares 8,624 174,391 

Investor AB, B Shares 36,344 753,044 

Ratos AB, B Shares 

Energy 0.0% 

3,080 27,606 

1,206,343 

Lundin Petroleum AB * 


10,780 243,385 

Swedish Match AB 23,716 985,652 


Elekta AB, B Shares 2,156 109,889 

Getinge AB, B Shares 


12,936 385,444 

495,333 

Boliden AB 11,704 171,981 

Holmen AB, B Shares 9,240 238,617 

SSAB AB, A Shares 7,084 53,545 

Svenska Cellulosa AB, B Shares 

Media 0.0% 

35,420 633,336 

1,097,479 

Modern Times Group, B Shares 


2,464 112,564 

Hennes & Mauritz AB, B Shares 37,268 1,348,518 


Telefonaktiebolaget LM Ericsson, B 

Shares 


184,184 1,724,556 

Tele2 AB, B Shares 28,028 493,119 

TeliaSonera AB 132,440 915,448 

1,408,567 

20,560,142 


Banks 0.0% 

Banque Cantonale Vaudoise - Reg’d 308 163,764 

Security 

Number 

of Shares 

Value 

($) 


ABB Ltd. - Reg’d * 158,004 2,755,035 

Geberit AG - Reg’d * 3,696 781,025 

Schindler Holding AG 3,696 436,490 

Schindler Holding AG - Reg’d 5,236 619,460 

Sulzer AG - Reg’d 924 125,224 

4,717,234 


Adecco S.A. - Reg’d * 10,472 476,000 

SGS S.A. - Reg’d 


Compagnie Financiere Richemont 

308 622,725 

1,098,725 

S.A., A Shares 31,108 1,912,002 

Swatch Group AG 2,156 884,490 

Swatch Group AG - Reg’d 


5,236 370,741 

3,167,233 

Credit Suisse Group AG - Reg’d * 73,304 1,418,986 

GAM Holding AG * 11,704 138,836 

Julius Baer Group Ltd. * 16,632 547,707 

Pargesa Holding S.A. 1,540 98,129 

UBS AG - Reg’d * 

Energy 0.1% 

251,020 2,814,291 

5,017,949 

Transocean Ltd. 


21,252 1,030,698 

Aryzta AG * 5,852 288,423 

Nestle S.A. - Reg’d 212,828 13,259,859 

13,548,282 


Nobel Biocare Holding AG - Reg’d * 7,084 67,300 

Sonova Holding AG - Reg’d * 3,388 314,758 

Straumann Holding AG - Reg’d 


616 73,395 

455,453 

Baloise Holding AG - Reg’d 2,772 204,423 

Swiss Re AG * 23,408 1,470,679 

Zurich Insurance Group AG * 


8,624 2,077,690 

3,752,792 

Givaudan S.A. - Reg’d * 924 873,949 

Holcim Ltd. - Reg’d * 13,244 814,021 

Syngenta AG - Reg’d 7,392 2,497,885 

4,185,855 


Actelion Ltd. - Reg’d * 924 43,765 

Novartis AG - Reg’d 162,008 9,566,397 

Roche Holding AG 


41,580 7,586,190 

17,196,352 

Swiss Prime Site AG - Reg’d * 


1,848 152,383 

Swisscom AG - Reg’d 1,848 743,778 




Security 

Number 

of Shares 

Value 

($) 


Kuehne & Nagel International AG - 

Reg’d 3,080 351,455 

55,581,953 



GKN plc 

Banks 2.2% 

101,332 343,630 

Barclays plc 742,280 2,160,519 

HSBC Holdings plc 1,077,692 9,364,998 

Lloyds Banking Group plc * 2,678,984 1,417,396 

Royal Bank of Scotland Group plc * 121,412 436,408 

Standard Chartered plc 


147,889 3,268,627 

16,647,948 

BAE Systems plc 207,900 1,051,744 

Bunzl plc 16,632 296,932 

Cobham plc 60,060 209,204 

IMI plc 9,240 126,217 

Invensys plc 47,432 181,943 

Meggitt plc 30,800 193,337 

Rolls-Royce Holdings plc * 108,724 1,417,800 

Smiths Group plc 28,336 470,328 

The Weir Group plc 9,240 239,665 

Wolseley plc 20,020 808,325 

4,995,495 


Aggreko plc 16,632 623,452 

Capita plc 38,500 441,514 

Experian plc 60,676 967,602 

G4S plc 87,472 351,508 

Hays plc 95,172 103,927 

Rentokil Initial plc 


137,368 167,896 

2,655,899 

Burberry Group plc 


30,492 655,285 

Carnival plc 17,556 602,039 

Compass Group plc 138,600 1,560,831 

Intercontinental Hotels Group plc 16,016 408,296 

Ladbrokes plc 87,164 234,944 

TUI Travel plc 60,676 204,025 

Whitbread plc 18,172 614,793 

William Hill plc 


71,456 340,832 

3,965,760 

3i Group plc 66,220 216,357 

Ashmore Group plc 21,252 111,056 

Hargreaves Lansdown plc 14,168 139,748 

ICAP plc 51,436 259,556 

Investec plc 15,400 91,825 

London Stock Exchange Group plc 6,160 97,206 

Man Group plc 92,092 104,294 

Schroders plc 9,548 215,503 

Schroders plc, Non-Voting Shares 6,160 113,497 

1,349,042 


Security 

Number 

of Shares 

Value 

($) 

Energy 3.7% 

AMEC plc 20,328 358,074 

BG Group plc 206,976 4,234,305 

BP plc 1,166,396 8,176,651 

Cairn Energy plc * 21,868 99,687 

Essar Energy plc * 27,412 43,671 

John Wood Group plc 31,108 405,412 

Petrofac Ltd. 9,240 220,439 

Royal Dutch Shell plc, A Shares 226,072 7,914,157 

Royal Dutch Shell plc, B Shares 153,692 5,545,112 

Tullow Oil plc 


60,984 1,320,256 

28,317,764 

J Sainsbury plc 120,736 628,242 

Tesco plc 486,640 2,601,766 

William Morrison Supermarkets plc 


162,624 723,251 

3,953,259 

Associated British Foods plc 22,792 479,310 

British American Tobacco plc 123,200 6,460,533 

Diageo plc 154,000 4,219,453 

Imperial Tobacco Group plc 60,984 2,378,979 

SABMiller plc 73,304 3,236,240 

Tate & Lyle plc 33,880 353,015 

Unilever plc 80,696 2,901,848 

20,029,378 


Smith & Nephew plc 


52,360 554,717 

Reckitt Benckiser Group plc 


49,280 2,786,551 

Aviva plc 172,788 894,975 

Legal & General Group plc 405,020 823,441 

Old Mutual plc 318,007 840,497 

Prudential plc 180,488 2,256,157 

Resolution Ltd. 214,406 734,911 

Standard Life plc 


131,208 552,897 

6,102,878 

Anglo American plc 85,316 2,371,455 

Antofagasta plc 16,016 281,610 

BHP Billiton plc 134,288 3,916,122 

CRH plc 44,968 791,388 

Eurasian Natural Resources Corp. 25,872 124,062 

Fresnillo plc 12,628 313,100 

Glencore International plc 229,460 1,403,364 

Johnson Matthey plc 12,054 459,695 

Kazakhmys plc 19,712 185,666 

Lonmin plc 13,552 123,340 

Randgold Resources Ltd. 5,236 525,609 

Rexam plc 63,756 429,169 

Rio Tinto plc 86,856 3,773,835 

Vedanta Resources plc 7,392 101,854 

Xstrata plc 

Media 0.5% 

145,068 2,194,048 

16,994,317 

Aegis Group plc 45,629 172,128 

British Sky Broadcasting Group plc 71,148 859,991



Security 

Number 

of Shares 

Value 

($) 

Daily Mail & General Trust plc, A 

Shares 13,552 103,214 

ITV plc 281,512 372,467 

Pearson plc 43,736 830,144 

Reed Elsevier plc 64,372 603,758 

WPP plc 75,152 972,847 

3,914,549 


AstraZeneca plc 88,088 4,108,592 

GlaxoSmithKline plc 291,984 6,608,764 

Shire plc 


32,340 984,197 

11,701,553 

British Land Co. plc 84,392 723,168 

Capital Shopping Centres Group plc 66,528 356,952 

Hammerson plc 65,296 473,968 

Land Securities Group plc 48,356 607,538 

SEGRO plc 


60,676 223,107 

2,384,733 

Kingfisher plc 128,128 560,880 

Marks & Spencer Group plc 86,856 493,613 

Next plc 9,856 559,658 

1,614,151 


ARM Holdings plc 


86,548 789,069 

The Sage Group plc 


79,156 372,405 

372,405 

BT Group plc 460,152 1,590,401 

Inmarsat plc 26,796 243,664 

Vodafone Group plc 


International Consolidated Airlines 

2,985,136 8,605,717 

10,439,782 

Group S.A. * 


70,840 159,552 

Centrica plc 329,868 1,711,732 

Drax Group plc 22,484 166,420 

National Grid plc 202,664 2,200,196 

Severn Trent plc 13,552 372,603 

SSE plc 52,668 1,144,404 

United Utilities Group plc 

Total Common Stock 

33,880 381,536 

5,976,891 

146,704,608 

(Cost $787,965,765) 760,958,498 

Preferred Stock 0.4% of net assets 

Germany 0.4% 


Porsche Automobil Holding SE 9,856 510,605 

Security 

Number 

of Shares 

Value 

($) 

Volkswagen AG 


11,088 1,962,290 

2,472,895 

Henkel AG & Co. KGaA 9,240 699,870 

3,172,765 

Italy 0.0% 


EXOR S.p.A. 

Total Preferred Stock 

2,772 55,521 

(Cost $2,782,165) 3,228,286 

Warrants 0.0% of net assets 

Israel 0.0% 

Energy 0.0% 

Isramco Negev 2 LP * 

Total Warrants 

29,600 74 

(Cost $—) 74 

Other Investment Company 0.0% of net assets 

Money Market Fund 0.0% 

State Street Institutional U.S. 

Government Money Market Fund 

Total Other Investment Company 

250,173 250,173 

(Cost $250,173) 250,173 

End of Investments 

Collateral Invested for Securities on Loan 0.3% of net 

assets 


Government Money Market Fund 2,686,618 2,686,618 

Total Collateral Invested for Securities on Loan 

(Cost $2,686,618) 2,686,618 

End of Collateral Invested for Securities on Loan 

At 08/31/12, the tax basis cost of the fund’s investments was 

$793,246,211 and the unrealized appreciation and depreciation 

were $65,911,759 and ($94,720,939), respectively, with a net 

unrealized depreciation of ($28,809,180). 

* Non-income producing security. 

(a) Illiquid security. At the period end, the value of these amounted 

to $213,385 or 0% of net assets. 

(b) Fair-valued by management in accordance with procedures 

approved by the Board of Trustees. 

(c) All or a portion of this security is on loan. 




ADR — American Depositary Receipt 

CDI — CHESS Depositary Interest 

CVA — Dutch Certificate 

GDR — Global Depositary Receipt 

Reg’d — Registered 

REIT — Real Estate Investment Trust 

RSP — Risparmio (Convertible Savings Shares) 

The following is a summary of the inputs used to value the fund’s investments as of August 31, 2012 (see financial note 2(a) for 

additional information): 

Description 

Quoted Prices in 

Active Markets for 

Identical Assets 

(Level 1) 

Significant Other 

Observable Inputs 

(Level 2) 

Significant 

Unobservable 

Inputs 

(Level 3) Total 

Common Stock 1 

$722,648,614 $— $— $722,648,614 

Republic of Korea 1 

33,107,357 — — 33,107,357 

Automobiles & Components 4,989,142 — 213,385 5,202,527 

Preferred Stock 1 

3,228,286 — — 3,228,286 

Warrants 1 

74 — — 74 

Other Investment Company 1 

250,173 — — 250,173 

Total 

Other Financial Instruments 

$764,223,646 $— $213,385 $764,437,031 

Collateral Invested for Securities on Loan $2,686,618 $— $— $2,686,618 

1 As categorized in Portfolio Holdings. 

The following is a reconciliation of Level 3 investments for which significant unobservable inputs were used to determine fair 

value: 

Investments in Securities 

Balance 

as of 

August 31, 

2011 

Realized 

Gains 

(Losses) 

Change in 

Unrealized 

Gains 

(Losses) 

Gross 

Purchases 

Gross 

Sales 

Gross 

Transfers 

in 

Gross 

Transfers 

out 

Balance 

as of 

August 31, 

2012 

Common Stock 

Australia $9,160 $— ($53,146) $43,986 $— $— $— $— 

Japan 199,871 — 31,463 — (231,334) — — $— 

Republic of Korea — — (4,252) 54,031 — 163,606 — $213,385 

Total $209,031 $— ($25,935) $98,017 ($231,334) $163,606 $— $213,385 

All net realized and change in unrealized gains (losses) on Level 3 investments in the tables above are reflected on the 

accompanying Statement of Operations. Changes in net unrealized gains (losses) for Level 3 investments held by the fund at 

August 31, 2012 are ($80,042). 

The fund’s policy is to recognize transfers between Level 1, Level 2 and Level 3 as of the beginning of the fiscal year. There were 

transfers in and out of Level 3 from Level 1 due to the result of fair valued securities for which no quoted value was available. 

There were no transfers between Level 1 and Level 2 for the period ended August 31, 2012. 

30 See financial notes


Statement of 

Assets and Liabilities 

As of August 31, 2012 

Assets 

Investments, at value (cost $790,998,103) including securities on loan of $2,952,767 $764,437,031 

Collateral invested for securities on loan 2,686,618 

Foreign currency, at value (cost $1,528,466) 1,543,097 

Receivables: 

Dividends 2,034,079 

Foreign tax reclaims 652,683 

Income from securities on loan 9,031 

Interest � 16 

Total assets 771,362,555 

Liabilities 

Collateral held for securities on loan 

Payables: 

2,686,618 

Investment adviser fees 8,236 

Due to custodian � 1,381 

Total liabilities 2,696,235 

Net Assets 


Total liabilities — 2,696,235 

Net assets $768,666,320 

Net Assets by Source 

Capital received from investors 802,643,444 

Net investment income not yet distributed 17,242,772 

Net realized capital losses (24,657,711) 

Net unrealized capital losses (26,562,185) 

Net Asset Value (NAV) 

Net Assets � 

Shares 

Outstanding = NAV 

$768,666,320 30,800,000 $24.96 



Statement of 

Operations 

For September 1, 2011 through August 31, 2012 

Investment Income 

Dividends (net of foreign withholding tax of $1,965,794) $24,000,308 

Interest 3,763 

Securities on loan � 254,676 

Total investment income 24,258,747 

Expenses 


Total expenses � 893,428 

Net investment income 23,365,319 

Realized and Unrealized Gains (Losses) 

Net realized losses on investments (18,820,574) 

Net realized losses on foreign currency transactions � (330,156) 

Net realized losses (19,150,730) 

Net unrealized losses on investments (6,152,346) 

Net unrealized losses on foreign currency translations � (65,073) 

Net unrealized losses � (6,217,419) 

Net realized and unrealized losses (25,368,149) 

Net decrease in net assets resulting from operations ($2,002,830) 



Statements of 

Changes in Net Assets 

For the current and prior report periods 

Operations 

9/1/11-8/31/12 9/1/10-8/31/11 

Net investment income $23,365,319 $16,338,245 

Net realized losses (19,150,730) (3,996,445) 

Net unrealized losses � (6,217,419) (1,919,270) 

Net increase (decrease) in net assets resulting from operations (2,002,830) 10,422,530 

Distributions to Shareholders 

Distributions from net investment income ($19,440,541) ($7,027,040) 

Transactions in Fund Shares 

9/1/11-8/31/12 9/1/10-8/31/11 

SHARES VALUE SHARES VALUE 

Shares sold 6,400,000 $155,902,019 12,400,000 $344,943,232 

Shares redeemed � (1) (24) — — 

Net transactions in fund shares 6,399,999 $155,901,995 12,400,000 $344,943,232 

Shares Outstanding and Net Assets 

9/1/11-8/31/12 9/1/10-8/31/11 

SHARES NET ASSETS SHARES NET ASSETS 

Beginning of period 24,400,001 $634,207,696 12,000,001 $285,868,974 

Total increase � 6,399,999 134,458,624 12,400,000 348,338,722 

End of period 30,800,000 $768,666,320 24,400,001 $634,207,696 

Net investment income not yet distributed $17,242,772 $13,591,511 


Schwab International Small-Cap Equity ETFÏ 




9/1/11– 

8/31/12 

9/1/10– 

8/31/11 

1/13/10 1 – 

8/31/10 




Net realized and unrealized gains (losses) (2.39) 3.88 (1.67) 



(1.72) 4.60 (1.46) 

Distributions from net investment income (0.82) (0.66) — 


Total return (%) (5.91) 19.52 (5.84) 2 



Net operating expenses 0.35 0.35 0.35 3 




25 18 7 2 


1 Commencement of operations. 

2 Not annualized. 

3 Annualized. 

4 Portfolio turnover rate excludes securities received or delivered from processing of in-kind creations or redemptions. 


Schwab International Small-Cap Equity ETF 














Cost 

($) 

Value 

($) 

98.5% Common Stock 165,608,987 157,289,538 


Companies 533,441 600,081 

0.5% Preferred Stock 787,961 819,744 

0.0% Rights — 20,535 

99.4% Total Investments 166,930,389 158,729,898 


Securities on Loan 5,730,800 5,730,800 

(3.0)% Other Assets and 

Liabilities, Net (4,851,097) 

100.0% Net Assets 159,609,601 

Security 



Number 

of Shares 

Value 

($) 


Ausdrill Ltd. 16,000 46,298 

Boart Longyear Ltd. 61,952 90,274 

Bradken Ltd. 22,713 131,447 

Cardno Ltd. 12,800 98,682 

Emeco Holdings Ltd. 56,740 45,738 

Macmahon Holdings Ltd. 206,517 126,988 

Monadelphous Group Ltd. (c) 9,565 198,589 

NRW Holdings Ltd. 47,744 121,872 

Seven Group Holdings Ltd. 12,800 107,413 

UGL Ltd. 17,742 191,239 

1,158,540 


Cabcharge Australia Ltd. (c) 27,104 156,019 

Mineral Resources Ltd. 6,400 47,423 

SAI Global Ltd. 37,841 168,159 

Seek Ltd. 35,848 264,146 

Transfield Services Ltd. 72,793 138,043 

Transpacific Industries Group Ltd. * 


48,000 44,149 

817,939 

Billabong International Ltd. 28,763 40,129 

G.U.D. Holdings Ltd. (c) 


19,018 167,846 

207,975 

Invocare Ltd. 36,169 333,419 

Security 

Number 

of Shares 

Value 

($) 

Navitas Ltd. (c) 


34,165 151,118 

484,537 

FlexiGroup Ltd. 

Energy 0.5% 

32,000 112,109 

Aurora Oil & Gas Ltd. * 73,088 245,481 

AWE Ltd. 83,941 124,051 

Beach Energy Ltd. 73,744 89,929 

Coalspur Mines Ltd. *(c) 65,600 40,677 

Drillsearch Energy Ltd. * 35,904 53,431 

Karoon Gas Australia Ltd. * 36,800 152,124 

Linc Energy Ltd. * 


121,344 66,463 

772,156 

Australian Agricultural Co., Ltd. * 34,165 45,547 

GrainCorp Ltd. 38,400 365,891 

Senex Energy Ltd. * 88,614 65,020 

476,458 


Primary Health Care Ltd. 95,670 368,785 

Sigma Pharmaceuticals Ltd. 


160,320 113,493 

482,278 

Bathurst Resources Ltd. *(c) 89,614 32,414 

Beadell Resources Ltd. * 48,823 39,356 

Coal of Africa Ltd. *(c) 97,013 28,072 

CuDeco Ltd. *(c) 15,168 65,210 

Discovery Metals Ltd. *(c) 48,000 47,869 

Evolution Mining Ltd. * 51,200 82,279 

Gindalbie Metals Ltd. *(c) 152,626 52,051 

Gryphon Minerals Ltd. *(c) 47,835 30,897 

Independence Group NL 31,725 114,752 

Integra Mining Ltd. * 145,385 70,617 

Intrepid Mines Ltd. *(c) 60,597 17,222 

Kingsgate Consolidated Ltd. 23,915 105,780 

Medusa Mining Ltd. (c) 32,548 167,174 

Mineral Deposits Ltd. * 5,312 27,448 

Mount Gibson Iron Ltd. 149,013 112,418 

PanAust Ltd. * 80,704 221,019 

Perseus Mining Ltd. * 85,214 215,758 

Regis Resources Ltd. * 52,610 257,713 

Resolute Mining Ltd. * 95,680 145,849 

Sandfire Resources NL * 15,189 113,019 

Silver Lake Resources Ltd. *(c) 25,600 78,575 

St. Barbara Ltd. *(c) 54,697 83,659 

Sundance Resources Ltd. * 489,280 161,807 

Western Areas NL (c) 16,000 65,810 

2,336,768 


Acrux Ltd. * 19,200 66,075 

Mesoblast Ltd. *(c) 41,024 269,216 

Pharmaxis Ltd. *(c) 


44,800 50,002 

385,293 

Abacus Property Group 70,059 146,253 

Aspen Group (c) 64,000 18,519 

BWP Trust 116,664 238,721 

Centro Retail Australia 134,529 297,522 




Security 

Number 

of Shares 

Value 

($) 

Challenger Diversified Property Group 25,626 61,176 

Charter Hall Group 47,835 131,992 

Charter Hall Retail REIT 65,888 236,960 

FKP Property Group (c) 199,650 61,899 

Investa Office Fund 


122,081 357,046 

1,550,088 

Automotive Holdings Group 54,625 167,098 

David Jones Ltd. (c) 71,488 178,788 

JB Hi-Fi Ltd. (c) 11,095 104,686 

Myer Holdings Ltd. (c) 82,005 168,648 

Pacific Brands Ltd. 181,376 114,340 

Premier Investments Ltd. 12,800 65,215 

Super Retail Group Ltd. 16,000 131,455 

Wotif.com Holdings Ltd. (c) 18,797 83,725 

1,013,955 


Silex Systems Ltd. * 


15,552 59,467 

carsales.com Ltd. (c) 15,937 119,902 

Iress Ltd. (c) 


29,760 225,745 

345,647 

TPG Telecom Ltd. 


62,600 134,564 

Australian Infrastructure Fund 64,000 203,714 

Virgin Australia Holdings Ltd. * 

Virgin Australia International Holdings 

424,000 197,182 

Ltd. (a)(b) 


424,000 — 

400,896 

DUET Group 96,000 208,343 

Energy World Corp. Ltd. * 147,200 77,583 

Hastings Diversified Utilities Fund 38,400 103,577 

Infigen Energy *(c) 133,696 42,141 

Spark Infrastructure Group (d) 147,200 246,441 

678,085 

11,416,755 

Austria 0.7% 


Semperit AG Holding 


2,680 98,000 

Wienerberger AG 

Energy 0.1% 

Schoeller-Bleckmann Oilfield 

17,792 136,848 

Equipment AG 


1,637 156,739 

Mayr Melnhof Karton AG 


680 63,086 

Atrium European Real Estate Ltd. 27,555 135,459 

CA Immobilien Anlagen AG * 12,800 126,010 

Conwert Immobilien Invest SE 12,800 140,369 

S IMMO AG 6,400 37,754 

439,592 


Security 

Number 

of Shares 

Value 

($) 


Oesterreichische Post AG 4,583 153,954 

1,048,219 

Belgium 1.1% 


Van de Velde N.V. 


832 36,181 

Ackermans & van Haaren N.V. 3,695 285,880 

RHJ International * 21,067 97,988 

Sofina S.A. 


2,594 198,571 

582,439 

Nyrstar * 26,541 128,132 

Tessenderlo Chemie N.V. 4,511 129,871 

258,003 


ThromboGenics N.V. * 


2,560 90,095 

Befimmo S.C.A. Sicafi 2,325 134,928 

Cofinimmo 


1,664 183,529 

318,457 

D’Ieteren S.A. N.V. 4,480 198,550 


Melexis N.V. 3,200 52,437 


Barco N.V. 1,088 65,499 

EVS Broadcast Equipment S.A. 2,702 131,126 

196,625 

1,732,787 

Canada 21.8% 


Linamar Corp. 

Banks 0.4% 

7,200 150,515 

Canadian Western Bank 7,200 205,235 

Genworth MI Canada, Inc. 7,200 142,490 

Home Capital Group, Inc. 


7,200 372,093 

719,818 

Aecon Group, Inc. 

ATS Automation Tooling Systems, 

7,200 90,105 

Inc. * 14,400 128,992 

CAE, Inc. 32,000 326,858 

Russel Metals, Inc. 7,200 182,764 

Superior Plus Corp. 12,800 115,049 

Toromont Industries Ltd. 8,500 174,591 

Westport Innovations, Inc. *(c) 6,400 225,558 

1,243,917 


Progressive Waste Solutions Ltd. 14,000 277,489 

Ritchie Bros. Auctioneers, Inc. 14,400 268,053 

Stantec, Inc. 7,200 230,187



Security 

Number 

of Shares 

Value 

($) 

Transcontinental, Inc., Class A 


7,200 71,573 

847,302 

Dorel Industries, Inc., Class B 6,400 212,393 

Gildan Activewear, Inc. 


12,800 387,820 

600,213 

AGF Management Ltd., Class B 7,200 83,028 

Canaccord Financial, Inc. 7,200 36,698 

Dundee Corp., Class A * 7,200 166,785 

GMP Capital, Inc. 6,400 34,048 

Onex Corp. 15,700 616,641 

TMX Group, Inc. 

Energy 6.0% 

1,800 90,926 

1,028,126 

Advantage Oil & Gas Ltd. * 21,600 75,294 

AltaGas Ltd. 12,800 402,347 

Athabasca Oil Corp. * 54,000 743,092 

Bankers Petroleum Ltd. * 34,000 92,334 

Baytex Energy Corp. (c) 12,800 582,378 

Birchcliff Energy Ltd. * 12,800 87,422 

BlackPearl Resources, Inc. * 38,400 123,739 

Bonavista Energy Corp. 12,800 214,403 

Calfrac Well Services Ltd. 7,200 175,467 

Celtic Exploration Ltd. * 15,500 259,786 

Crew Energy, Inc. * 7,200 45,746 

Denison Mines Corp. * 64,000 89,497 

Enerflex Ltd. 7,200 89,521 

Enerplus Corp. 19,200 302,344 

Ensign Energy Services, Inc. 14,400 219,170 

Gibson Energy, Inc. 6,400 140,536 

Keyera Corp. 6,400 291,838 

Legacy Oil & Gas, Inc. * 14,000 91,787 

Mullen Group Ltd. 7,200 168,682 

Nuvista Energy Ltd. * 

Paramount Resources Ltd., A 

14,400 63,912 

Shares * 7,200 175,759 

Pason Systems, Inc. 7,200 108,564 

Pembina Pipeline Corp. 32,060 868,058 

Pengrowth Energy Corp. 

PetroBakken Energy Ltd., A 

44,804 302,371 

Shares (c) 6,800 89,578 

Petrobank Energy & Resources Ltd. * 9,600 120,334 

Petrominerales Ltd. 

Peyto Exploration & Development 

12,800 120,756 

Corp. 12,800 264,989 

Precision Drilling Corp. * 32,000 236,388 

Progress Energy Resources Corp. 32,000 712,408 

Savanna Energy Services Corp. 14,400 106,667 

ShawCor Ltd., Class A 7,200 253,461 

SouthGobi Resources Ltd. *(c) 12,800 34,891 

Tourmaline Oil Corp. * 16,000 447,160 

Trican Well Service Ltd. 21,000 253,230 

Trilogy Energy Corp. 8,000 175,103 

Trinidad Drilling Ltd. 19,200 126,463 

Uranium One, Inc. * 70,400 168,358 

Veresen, Inc. (c) 19,200 254,288 

Vermilion Energy, Inc. 9,600 436,881 

9,515,002 

Security 

Number 

of Shares 

Value 

($) 


Empire Co., Ltd., A Shares 6,400 370,828 

Metro, Inc. 12,800 742,695 

The Jean Coutu Group, Inc., A Shares 


14,400 210,269 

1,323,792 

Cott Corp. * 14,400 118,778 

Maple Leaf Foods, Inc. 14,400 161,240 

Viterra, Inc. 42,600 696,726 

976,744 


Catamaran Corp. * 10,700 927,691 

Extendicare, Inc. (c) 


Industrial Alliance Insurance & 

14,400 116,589 

1,044,280 

Financial Services, Inc. 


7,200 183,274 

Alacer Gold Corp. * 32,000 191,964 

Alamos Gold, Inc. 15,000 281,654 

AuRico Gold, Inc. * 35,827 248,685 

Aurizon Mines Ltd. * 21,600 87,770 

B2Gold Corp. * 25,600 97,798 

Banro Corp. * 12,800 54,995 

Canfor Corp. * 14,400 190,424 

Capstone Mining Corp. * 28,800 70,625 

CCL Industries, Inc., Class B 7,200 263,894 

Centerra Gold, Inc. 19,200 145,919 

CGA Mining Ltd. * 

China Gold International Resources 

32,000 78,472 

Corp. Ltd. * 21,000 72,777 

Detour Gold Corp. * 12,800 321,670 

Dundee Precious Metals, Inc. * 14,000 120,586 

Endeavour Silver Corp. * 6,400 56,811 

First Majestic Silver Corp. * 12,800 252,278 

Franco-Nevada Corp. 15,800 818,779 

Gabriel Resources Ltd. * 21,600 50,561 

Harry Winston Diamond Corp. * 7,200 90,470 

HudBay Minerals, Inc. 22,700 193,911 

Imperial Metals Corp. * 14,000 162,010 

Inmet Mining Corp. 7,900 352,312 

Katanga Mining Ltd. * 64,000 29,832 

Kirkland Lake Gold, Inc. * 6,800 93,919 

Lundin Mining Corp. * 57,600 260,903 

Major Drilling Group International, Inc. 13,600 128,717 

Methanex Corp. 14,400 428,710 

Nevsun Resources Ltd. 12,800 51,363 

New Gold, Inc. * 51,200 566,554 

NovaGold Resources, Inc. * 32,000 149,162 

OceanaGold Corp. *(c) 27,200 71,662 

Pan American Silver Corp. 19,360 339,587 

Pretium Resources, Inc. * 6,400 94,620 

Rubicon Minerals Corp. * 32,000 111,871 

Seabridge Gold, Inc. * 6,400 107,202 

SEMAFO, Inc. 34,400 129,673 

Sherritt International Corp. 30,100 133,900 

Silver Standard Resources, Inc. * 7,200 106,813 

Silvercorp Metals, Inc. 21,000 123,423 

Sino-Forest Corp. *(a)(b) 17,700 — 

Tahoe Resources, Inc. * 12,800 232,951 




Security 

Number 

of Shares 

Value 

($) 

Taseko Mines Ltd. * 21,600 64,788 

Thompson Creek Metals Co., Inc. * 14,400 40,565 

West Fraser Timber Co., Ltd. 

Media 1.1% 

6,400 360,517 

7,831,097 

Aimia, Inc. 25,600 376,146 

Astral Media, Inc., A Shares 7,200 345,463 

Cineplex, Inc. 6,400 192,937 

Cogeco Cable, Inc. 6,400 237,815 

Corus Entertainment, Inc. 6,400 150,134 

Imax Corp. * 6,800 137,537 

Quebecor, Inc., Class B 6,800 243,239 

Torstar Corp. 6,800 59,397 

1,742,668 


Nordion, Inc. 


Allied Properties Real Estate 

14,400 150,296 

Investment Trust 7,200 223,256 

Artis Real Estate Investment Trust 

Boardwalk Real Estate Investment 

12,800 215,311 

Trust 

Calloway Real Estate Investment 

7,200 469,421 

Trust 

Canadian Apartment Properties Real 

12,800 380,037 

Estate Investment Trust 

Canadian Real Estate Investment 

7,200 180,939 

Trust 

Chartwell Seniors Housing Real 

7,200 304,970 

Estate Investment Trust 25,600 268,491 

Cominar Real Estate Investment Trust 12,800 313,888 

Dundee Real Estate Investment Trust 9,600 371,996 

First Capital Realty, Inc. 14,400 280,894 

FirstService Corp. * 2,500 67,766 

H&R Real Estate Investment Trust (c) 21,000 538,380 

InnVest Real Estate Investment Trust 

Morguard Real Estate Investment 

19,200 98,446 

Trust 

Primaris Retail Real Estate 

7,200 124,615 

Investment Trust 


7,200 174,008 

4,012,418 

Dollarama, Inc. 7,000 420,631 

Reitmans (Canada) Ltd., Class A 6,800 86,133 

RONA, Inc. 


MacDonald, Dettwiler & Associates 

12,800 166,672 

673,436 

Ltd. 6,400 383,605 

Open Text Corp. * 6,400 343,655 

727,260 


Celestica, Inc. * 


15,000 116,887 

Manitoba Telecom Services, Inc. 


6,400 220,759 

TransForce, Inc. 7,200 132,348 


Security 

Number 

of Shares 

Value 

($) 


ATCO Ltd., Class I 6,400 495,476 

Atlantic Power Corp. 12,800 180,550 

Capital Power Corp. 6,400 141,574 

Emera, Inc. 14,000 488,301 

Innergex Renewable Energy, Inc. 6,400 70,884 

Just Energy Group, Inc. (c) 6,400 70,819 

Northland Power, Inc. 6,400 119,783 

1,567,387 

34,807,539 

Denmark 0.9% 

Banks 0.2% 

Jyske Bank A/S * 8,451 242,315 

Sydbank A/S * 


10,981 187,428 

429,743 

NKT Holding A/S 


2,934 96,236 

Bang & Olufsen A/S * 3,200 38,975 

Pandora A/S (c) 5,056 68,465 

107,440 


GN Store Nord A/S 


24,000 325,400 

Topdanmark A/S * 1,600 302,326 


Alk-Abello A/S 


1,718 109,273 

SimCorp A/S 680 117,331 

1,487,749 

Finland 1.9% 


Cargotec Oyj, B Shares 5,312 125,144 

Cramo Oyj 6,034 61,531 

Konecranes Oyj (c) 6,037 152,802 

Outotec Oyj 5,120 231,819 

Ramirent Oyj 12,674 95,854 

Uponor Oyj 6,400 64,739 

YIT Oyj 14,028 259,399 

991,288 


Lassila & Tikanoja Oyj * 


6,402 84,732 

Amer Sports Oyj 


15,320 186,832 

Pohjola Bank plc, A Shares 


20,774 234,754 

Huhtamaki Oyj 14,795 212,786 

Kemira Oyj 12,800 162,635 

Metsa Board Oyj * 39,269 101,472 

Tikkurila Oyj 6,400 110,521 

587,414



Security 

Number 

of Shares 

Value 

($) 


Orion Oyj, Class B 


8,057 165,743 

Citycon Oyj 35,281 107,177 

Sponda Oyj 


36,404 144,545 

251,722 

Stockmann Oyj Abp, B Shares 


5,058 94,933 

Tieto Oyj 


10,476 180,116 

Elisa Oyj 13,210 279,907 

3,057,441 

France 3.0% 


Mersen 2,240 64,941 

Nexans S.A. 3,916 182,809 

Saft Groupe S.A. 3,297 81,040 

328,790 


Teleperformance 


8,355 207,154 

Beneteau 6,474 69,853 

Nexity 

Energy 0.3% 

4,060 99,487 

169,340 

Bourbon S.A. 7,488 198,211 

Etablissements Maurel et Prom 13,201 207,333 

Maurel & Prom Nigeria * 


16,083 41,964 

447,508 

Rallye S.A. 


3,844 115,804 

Remy Cointreau S.A. 3,081 352,670 


Medica S.A. 9,046 154,960 

Orpea 


4,480 173,195 

328,155 

S.A. des Ciments Vicat 

Media 0.5% 

2,560 126,139 

Havas S.A. 67,075 341,151 

Ipsos 4,204 125,537 

Metropole Television S.A. 11,834 179,747 

Societe d’Edition de Canal + 17,295 100,521 

746,956 


Virbac S.A. 


952 172,499 

Mercialys 

Societe Immobiliere de Location pour 

3,959 81,517 

l’Industrie et le Commerce 1,637 159,689 

241,206 

Security 

Number 

of Shares 

Value 

($) 


CFAO 6,272 294,730 


Silicon-On-Insulator Technologies *(c) 


19,200 64,376 

Alten 4,967 149,510 

Altran Technologies S.A. * 22,862 127,086 

Groupe Steria SCA 4,132 56,433 

UbiSoft Entertainment S.A. * 17,309 131,126 

464,155 


Ingenico 4,160 221,152 

Neopost S.A. 


3,595 192,408 

413,560 

Rubis 4,508 249,682 

4,722,724 

Germany 4.0% 


ElringKlinger AG 6,400 188,006 

Leoni AG 

Banks 0.1% 

6,400 240,403 

428,409 

Aareal Bank AG * 


4,800 96,201 

Bauer AG 2,630 54,037 

Deutz AG * 20,203 75,634 

Gildemeister AG 9,497 138,564 

Krones AG 2,730 133,483 

KUKA AG * 4,601 115,005 

MTU Aero Engines Holding AG 4,727 361,495 

Pfeiffer Vacuum Technology AG 1,574 156,738 

Rheinmetall AG 1,718 85,203 

SGL Carbon SE (c) 4,800 185,384 

Vossloh AG 


1,152 100,819 

1,406,362 

Gerry Weber International AG 3,494 141,507 

Rational AG 

Energy 0.0% 

612 146,455 

287,962 

CropEnergies AG 3,200 18,022 


Rhoen Klinikum AG (c) 


8,451 201,865 

Aurubis AG 6,150 333,804 

Fuchs Petrolub AG 5,941 328,040 

Symrise AG 

Media 0.1% 

12,962 439,753 

1,101,597 

Sky Deutschland AG * 64,704 225,430 


MorphoSys AG * 5,711 140,375 




Security 

Number 

of Shares 

Value 

($) 

Stada Arzneimittel AG 


8,731 246,081 

386,456 

Alstria Office REIT-AG 8,609 94,648 

Deutsche Euroshop AG 6,037 221,250 

Deutsche Wohnen AG 13,581 230,248 

DIC Asset AG 6,400 57,100 

GAGFAH S.A. * 12,674 137,502 

IVG Immobilien AG * 


19,200 43,781 

784,529 

BayWa AG 1,920 76,078 

Douglas Holding AG 4,537 205,308 

281,386 


Aixtron SE (c) 12,751 189,175 

Dialog Semiconductor plc * 


8,628 186,136 

375,311 

Bechtle AG 960 37,833 

Wirecard AG 11,618 249,322 

287,155 


Wincor Nixdorf AG 


4,089 156,197 

Freenet AG 19,660 302,086 

6,338,968 

Greece 0.2% 

Banks 0.1% 

Bank of Cyprus plc * 243,519 52,182 

Piraeus Bank S.A. * 

Energy 0.0% 

Motor Oil (Hellas) Corinth Refineries 

138,078 44,034 

96,216 

S.A. 


11,800 70,800 

Titan Cement Co. S.A. * 


8,550 142,799 

JUMBO S.A. * 15,000 67,122 

376,937 



Minth Group Ltd. 


144,000 160,407 

China Liansu Group Holdings Ltd. (c) 

China Singyes Solar Technologies 

64,000 30,365 

Holdings Ltd. 76,800 27,725 

Haitian International Holdings Ltd. (c) 68,000 68,647 

Lonking Holdings Ltd. (c) 128,000 19,638 

Singamas Container Holdings Ltd. 256,000 56,110 

202,485 


Security 

Number 

of Shares 

Value 

($) 


Daphne International Holdings Ltd. 145,000 145,070 

Haier Electronics Group Co., Ltd. * 68,000 80,044 

Ports Design Ltd. (c) 72,000 56,718 

Samsonite International S.A. 76,800 142,980 

Skyworth Digital Holdings Ltd. 328,000 134,055 

Stella International Holdings Ltd. 72,000 171,547 

Trinity Ltd. 162,000 105,476 

YGM Trading Ltd. 


16,000 34,697 

870,587 

Ajisen China Holdings Ltd. (c) 


204,000 125,195 

Value Partners Group Ltd. (c) 

Energy 0.1% 

128,000 54,459 

Sino Oil & Gas Holdings Ltd. *(c) 4,160,000 83,669 

United Energy Group Ltd. *(c) 


512,000 75,253 

158,922 

C.P. Pokphand Co., Ltd. 

Global Bio-Chem Technology Group 

1,254,000 158,442 

Co., Ltd. (c) 256,000 25,414 

Uni-President China Holdings Ltd. (c) 128,000 132,023 

315,879 


Vinda International Holdings Ltd. (c) 


China Lumena New Materials 

64,000 100,007 

Corp. (c) 

China Precious Metal Resources 

256,000 42,247 

Holdings Co., Ltd. *(c) 256,000 44,888 

China Shanshui Cement Group Ltd. 

China Vanadium Titano - Magnetite 

288,000 150,382 

Mining Co., Ltd. (c) 192,000 27,725 

Dongyue Group (c) 192,000 91,591 

Fufeng Group Ltd. 144,000 47,714 

North Mining Shares Co., Ltd. * 1,280,000 65,186 

West China Cement Ltd. (c) 640,000 99,842 

Yingde Gases (c) 

Media 0.1% 

Phoenix Satellite Television Holdings 

96,000 74,386 

643,961 

Ltd. 128,000 38,452 

VODone Ltd. 703,999 58,997 

97,449 


Anxin-China Holdings Ltd. 

China Medical System Holdings 

512,000 108,259 

Ltd. (c) 

China Shineway Pharmaceutical 

288,600 152,184 

Group Ltd. 64,000 96,376 

Sino Biopharmaceutical Ltd. 


512,000 200,014 

556,833 

C C Land Holdings Ltd. 256,000 53,469 

Glorious Property Holdings Ltd. *(c) 384,000 54,459 

Kaisa Group Holdings Ltd. *(c) 256,000 45,218 

Lai Sun Development Co., Ltd. * 2,432,000 43,584



Security 

Number 

of Shares 

Value 

($) 

Yuexiu Real Estate Investment Trust 


China ZhengTong Auto Services 

256,000 119,151 

315,881 

Holdings Ltd. *(c) 

Chow Sang Sang Holdings 

96,000 57,430 

International Ltd. (c) 26,000 52,561 

Emperor Watch & Jewellery Ltd. (c) 830,000 79,188 

Giordano International Ltd. (c) 128,000 98,852 

Hengdeli Holdings Ltd. (c) 

Intime Department Store Group Co., 

288,000 75,748 

Ltd. 

Luk Fook Holdings International 

96,000 98,646 

Ltd. (c) 

New World Department Store China 

80,000 204,429 

Ltd. 128,000 69,477 

PCD Stores Group Ltd. 512,000 34,986 

SA SA International Holdings Ltd. (c) 256,000 167,338 

Silver Base Group Holdings Ltd. (c) 196,800 81,194 

1,019,849 


Apollo Solar Energy Technology 

Holdings Ltd. * 


2,560,000 70,302 

Chinasoft International Ltd. * 200,000 45,125 

G-Resources Group Ltd. * 4,080,000 186,740 

Hi Sun Technology China Ltd. *(c) 

Kingdee International Software Group 

279,000 16,367 

Co., Ltd. *(c) 256,000 38,286 

Kingsoft Corp., Ltd. 128,000 59,245 

345,763 


China Wireless Technologies Ltd. 512,000 91,096 

Digital China Holdings Ltd. 128,000 206,285 

Ju Teng International Holdings Ltd. 

Tech Pro Technology Development 

128,000 56,935 

Ltd. * 


SmarTone Telecommunications 

128,000 47,528 

401,844 

Holding Ltd. 


64,000 136,478 

Pacific Basin Shipping Ltd. 


432,000 179,901 

China Gas Holdings Ltd. 560,000 306,127 

China Water Affairs Group Ltd. (c) 256,000 63,701 

Towngas China Co., Ltd. 136,000 105,030 

474,858 

6,231,060 

Ireland 1.1% 

Banks 0.2% 

The Governor & Co. of the Bank of 

Ireland * 


3,264,000 362,056 

DCC plc 9,615 251,484 

Grafton Group plc 42,560 164,159 

Security 

Number 

of Shares 

Value 

($) 

Kingspan Group plc 


21,760 215,149 

630,792 

Paddy Power plc 


2,560 181,351 

C&C Group plc 51,200 232,658 


United Drug plc 


46,160 151,280 

Smurfit Kappa Group plc 25,425 207,705 

1,765,842 

Israel 0.2% 


Given Imaging Ltd. * 3,840 52,618 


Nova Measuring Instruments Ltd. * 6,400 48,966 

Tower Semiconductor Ltd. * 


4,266 32,427 

81,393 

Allot Communications Ltd. * 3,200 83,311 

Retalix Ltd. * 3,200 66,267 

149,578 


Ceragon Networks Ltd. * 6,400 44,964 

328,553 

Italy 1.9% 


Piaggio & C S.p.A. 

Banks 0.4% 

Banca Popolare dell’Emilia Romagna 

22,400 59,068 

Scrl 34,551 188,927 

Banca Popolare di Milano Scarl * 444,800 230,379 

Banca Popolare di Sondrio Scrl 33,600 192,705 

Credito Emiliano S.p.A. 


C.I.R. S.p.A - Compagnie Industriali 

14,646 62,436 

674,447 

Riunite 

Danieli & C Officine Meccaniche 

68,369 79,888 

S.p.A. 9,569 118,205 

Impregilo S.p.A. 


51,200 185,223 

383,316 

Tod’s S.p.A. 


1,977 210,949 

Azimut Holding S.p.A. 22,641 240,869 

Banca Generali S.p.A. 

Energy 0.1% 

9,497 112,527 

353,396 

ERG S.p.A. 15,307 103,997 


DiaSorin S.p.A. (c) 4,480 137,110 




Security 

Number 

of Shares 

Value 

($) 

Sorin S.p.A. * 


90,688 194,788 

331,898 

Fondiaria-Sai S.p.A. * 

Societa Cattolica di Assicurazioni 

78,936 102,384 

Scrl * 8,873 119,338 

221,722 


Recordati S.p.A. 


15,083 108,464 

Beni Stabili S.p.A. 


102,505 45,417 

Yoox S.p.A. *(c) 


3,841 45,027 

Ansaldo STS S.p.A. 


23,153 182,110 

ACEA S.p.A. 12,746 70,853 

Hera S.p.A. 89,071 131,585 

IREN S.p.A. 92,915 51,392 

253,830 

2,973,641 

Japan 14.1% 


Akebono Brake Industry Co., Ltd. (c) 12,800 64,736 

Daido Metal Co., Ltd. 7,000 57,931 

Keihin Corp. 6,400 83,453 

Musashi Seimitsu Industry Co., Ltd. 6,400 119,908 

Nissin Kogyo Co., Ltd. 12,800 174,100 

Press Kogyo Co., Ltd. 32,000 127,509 

Showa Corp. 6,400 55,336 

Toyo Tire & Rubber Co., Ltd. 20,000 54,151 

TPR Co., Ltd. 3,200 40,337 

TS Tech Co., Ltd. 12,800 230,825 

Unipres Corp. 

Banks 0.7% 

6,400 175,816 

1,184,102 

FIDEA Holdings Co., Ltd. 23,900 47,007 

Kiyo Holdings, Inc. 128,000 173,282 

The Bank of Okinawa Ltd. 3,200 138,135 

The Fukui Bank Ltd. 72,000 168,276 

The Miyazaki Bank Ltd. 31,000 77,203 

The Oita Bank Ltd. 68,000 213,640 

The Toho Bank Ltd. 23,000 73,142 

The Tokyo Tomin Bank Ltd. 6,400 61,466 

The Tsukuba Bank Ltd. 18,200 60,434 

The Yachiyo Bank Ltd. 2,200 42,005 

TOMONY Holdings, Inc. 


12,800 52,966 

1,107,556 

Aica Kogyo Co., Ltd. 12,800 205,487 

Amano Corp. 6,800 58,013 

Asahi Diamond Industrial Co., Ltd. 6,800 74,774 

Central Glass Co., Ltd. 64,000 209,247 

Daifuku Co., Ltd. 36,000 188,966 

Denyo Co., Ltd. 6,400 70,212 

Futaba Corp. 14,400 185,011 


Security 

Number 

of Shares 

Value 

($) 

Hanwa Co., Ltd. 72,000 242,759 

Hitachi Zosen Corp. 170,000 188,889 

Inaba Denki Sangyo Co., Ltd. 7,200 200,460 

Iseki & Co., Ltd. 68,000 167,612 

Iwatani Corp. 64,000 222,324 

Kitz Corp. 6,400 26,646 

Kyowa Exeo Corp. 21,600 231,724 

Maeda Corp. 32,000 136,909 

Meidensha Corp. 72,000 262,989 

Mirait Holdings Corp. 12,800 91,545 

Miura Co., Ltd. 6,800 169,870 

Nachi-Fujikoshi Corp. 26,000 75,377 

Nichias Corp. (c) 19,000 98,033 

Nippo Corp. 8,000 87,356 

Nitto Boseki Co., Ltd. 64,000 219,055 

Noritz Corp. 12,800 227,392 

Oiles Corp. 6,400 128,490 

Okumura Corp. 72,000 225,287 

OSG Corp. 

Penta-Ocean Construction Co., 

21,600 307,034 

Ltd. (c) 32,000 74,381 

Sanwa Holdings Corp. 64,000 266,462 

SHO-BOND Holdings Co., Ltd. 7,200 241,747 

Sintokogio Ltd. 18,800 148,383 

Taikisha Ltd. 

Takasago Thermal Engineering Co., 

6,400 146,064 

Ltd. 12,800 98,902 

Toyo Construction Co., Ltd. 64,000 42,503 

Toyo Tanso Co., Ltd. 6,400 161,757 

Tsubakimoto Chain Co. 24,000 141,916 

5,623,576 


Daiseki Co., Ltd. 7,200 117,517 

Duskin Co., Ltd. 14,400 288,184 

Meitec Corp. 7,500 166,284 

Mitsubishi Pencil Co., Ltd. 


6,400 116,230 

688,215 

JVC Kenwood Corp. 11,600 40,889 

Mizuno Corp. 39,000 190,268 

Pioneer Corp. *(c) 65,300 172,632 

Sangetsu Co., Ltd. 7,200 186,667 

Seiko Holdings Corp. * 18,000 49,655 

Tamron Co., Ltd. 6,400 212,026 

Token Corp. 640 26,891 

Tomy Co., Ltd. 


28,800 163,678 

1,042,706 

Accordia Golf Co., Ltd. 384 245,211 

Colowide Co., Ltd. (c) 8,000 68,250 

Doutor Nichires Holdings Co., Ltd. 19,200 237,609 

HIS Co., Ltd. 1,600 55,295 

Saizeriya Co., Ltd. (c) 15,500 237,746 

Zensho Holdings Co., Ltd. (c) 


6,400 82,554 

926,665 

Aiful Corp. *(c) 56,350 102,193 

Fuyo General Lease Co., Ltd. 6,400 186,033 

IBJ Leasing Co., Ltd. 6,400 159,142 

Jaccs Co., Ltd. 14,000 50,421



Security 

Number 

of Shares 

Value 

($) 

Japan Securities Finance Co., Ltd. 12,800 58,197 

Orient Corp. * 

Energy 0.1% 

41,000 52,363 

608,349 

Itochu Enex Co., Ltd. 6,400 34,166 

Shinko Plantech Co., Ltd. 


6,400 53,129 

87,295 

Ain Pharmaciez, Inc. 1,400 94,943 

Arcs Co., Ltd. 6,400 148,925 

Cocokara fine, Inc. 6,400 220,772 

Izumiya Co., Ltd. 23,000 111,328 

Ministop Co., Ltd. 2,600 43,333 

Okuwa Co., Ltd. 4,000 52,005 

Valor Co., Ltd. 


6,400 111,734 

783,040 

Fuji Oil Co., Ltd. 19,200 256,245 

Fujiya Co., Ltd. *(c) 64,000 160,204 

Hokuto Corp. 6,400 124,976 

Megmilk Snow Brand Co., Ltd. 6,400 109,936 

Morinaga Milk Industry Co., Ltd. 72,000 248,276 

Nippon Suisan Kaisha Ltd. 19,200 42,176 

The Nisshin Oillio Group Ltd. 64,000 248,480 

Yonekyu Corp. 19,200 170,667 

1,360,960 


Nagaileben Co., Ltd. 6,400 98,738 

Nihon Kohden Corp. 6,400 216,930 

Nikkiso Co., Ltd. 5,000 57,088 

Ship Healthcare Holdings, Inc. 6,400 186,197 

Toho Holdings Co., Ltd. 


12,800 229,517 

788,470 

Aderans Co., Ltd. * 8,100 98,586 

Fancl Corp. 13,600 157,711 

Mandom Corp. 


7,200 191,173 

447,470 

Adeka Corp. 21,600 169,379 

Asahi Holdings, Inc. (c) 6,400 105,931 

Earth Chemical Co., Ltd. 6,400 236,955 

FP Corp. 700 51,941 

Kureha Corp. 32,000 132,823 

Kyoei Steel Ltd. 6,400 118,192 

Nifco, Inc. 6,400 150,559 

Nippon Light Metal Co., Ltd. 144,000 143,448 

Nippon Soda Co., Ltd. 64,000 274,636 

NOF Corp. 32,000 152,031 

Sanyo Special Steel Co., Ltd. 

Sumitomo Light Metal Industries 

30,000 99,617 

Ltd. (c) 64,000 56,398 

Toagosei Co., Ltd. 72,000 265,747 

Tokyo Ohka Kogyo Co., Ltd. 6,400 143,285 

Toyo Ink SC Holdings Co., Ltd. 72,000 259,310 

Yodogawa Steel Works Ltd. 64,000 220,690 

2,580,942 

Security 

Number 

of Shares 

Value 

($) 

Media 0.3% 

Avex Group Holdings, Inc. 6,400 114,840 

Kadokawa Group Holdings, Inc. (c) 6,400 175,571 

Shochiku Co., Ltd. (c) 20,000 194,636 

485,047 


KYORIN Holdings, Inc. 7,000 161,635 

Nichi-iko Pharmaceutical Co., Ltd. 7,200 161,563 

Seikagaku Corp. 


14,800 168,981 

492,179 

Daibiru Corp. 6,400 41,849 

Daikyo, Inc. 25,000 60,026 

Goldcrest Co., Ltd. 1,920 28,077 

Heiwa Real Estate Co., Ltd. 32,000 73,972 

Kenedix, Inc. * 332 32,606 

Leopalace21 Corp. *(c) 38,400 124,077 

TOC Co., Ltd. 


12,800 65,389 

425,996 

AOKI Holdings, Inc. 2,600 55,254 

Arc Land Sakamoto Co., Ltd. 2,400 37,119 

DCM Holdings Co., Ltd. (c) 6,400 42,094 

EDION Corp. 12,800 56,235 

Geo Holdings Corp. 64 75,443 

Gulliver International Co., Ltd. 940 28,212 

Honeys Co., Ltd. 1,280 17,868 

Joshin Denki Co., Ltd. 10,000 114,048 

Megane TOP Co., Ltd. 4,600 52,580 

Nissen Holdings Co., Ltd. 7,500 29,981 

The Daiei, Inc. *(c) 17,450 38,555 

Tsutsumi Jewelry Co., Ltd. 6,400 163,474 

Xebio Co., Ltd. 6,400 134,784 

Yellow Hat Ltd. 6,400 100,455 

946,102 


Sanken Electric Co., Ltd. 


18,000 54,253 

eAccess Ltd. (c) 320 58,319 

Fuji Soft, Inc. 6,400 113,860 

GMO internet, Inc. 11,000 67,012 

Ines Corp. 7,800 46,421 

IT Holdings Corp. 6,400 80,838 

Net One Systems Co., Ltd. 12,800 169,032 

Nihon Unisys Ltd. 12,800 85,006 

SCSK Corp. 6,400 100,782 

Transcosmos, Inc. 3,800 47,706 

768,976 


Anritsu Corp. 12,000 144,827 

Canon Electronics, Inc. 6,400 136,746 

Daiwabo Holdings Co., Ltd. 64,000 112,797 

Horiba Ltd. 7,200 212,322 

Hosiden Corp. 25,600 131,760 

Nichicon Corp. 23,200 177,778 

Nippon Chemi-Con Corp. * 12,000 23,142 

Oki Electric Industry Co., Ltd. *(c) 64,000 74,380 

Riso Kagaku Corp. 2,600 44,794 

Ryosan Co., Ltd. 7,200 131,678 




Security 

Number 

of Shares 

Value 

($) 

Star Micronics Co., Ltd. 6,400 62,202 

Wacom Co., Ltd. 


64 143,939 

1,396,365 

Iino Kaiun Kaisha Ltd. 12,800 46,590 

Japan Airport Terminal Co., Ltd. 8,100 94,552 

Nippon Konpo Unyu Soko Co., Ltd. 6,400 82,636 

Sankyu, Inc. 64,000 239,489 

The Sumitomo Warehouse Co., Ltd. 


32,000 140,996 

604,263 

The Okinawa Electric Power Co., Inc. 1,100 35,627 

22,438,154 

Netherlands 1.7% 


Aalberts Industries N.V. 9,600 164,753 

Arcadis N.V. 7,069 147,914 

Koninklijke BAM Groep N.V. 28,462 81,439 

Royal Imtech N.V. 


9,665 250,477 

644,583 

Koninklijke Ten Cate N.V. 


4,305 103,428 

BinckBank N.V. 


11,023 78,184 

Sligro Food Group N.V. 


4,655 113,245 

CSM N.V. 9,497 160,411 

Nutreco N.V. 4,655 341,026 

501,437 


Mediq N.V. 


7,040 83,211 

Delta Lloyd N.V. 


9,600 132,564 

Eurocommercial Properties N.V. 5,763 203,762 

Nieuwe Steen Investments N.V. 7,616 63,581 

VastNed Retail N.V. 3,009 122,888 

Wereldhave N.V. 2,458 126,504 

516,735 


ASM International N.V. 


6,656 234,917 

Unit 4 N.V. 4,780 118,817 


TKH Group N.V. 6,704 137,319 

2,664,440 

New Zealand 0.3% 


TOWER Ltd. 


28,800 42,574 

AMP NZ Office Ltd. 64,000 49,361 


Security 

Number 

of Shares 

Value 

($) 

Goodman Property Trust 


154,834 125,016 

174,377 

Freightways Ltd. 19,200 61,701 

Mainfreight Ltd. 


6,400 49,618 

111,319 

Infratil Ltd. 108,564 182,290 

510,560 

Norway 2.0% 

Banks 0.1% 

Sparebanken 1 SMN 


19,607 114,748 

Kongsberg Gruppen A.S.A. 7,040 138,552 


Tomra Systems A.S.A. 

Energy 0.9% 

31,263 269,318 

BW Offshore Ltd. 67,178 49,173 

DNO International A.S.A. * 134,400 199,309 

Dockwise Ltd. * 4,973 84,135 

Fred. Olsen Energy A.S.A. 3,767 159,979 

Frontline Ltd. (c) 6,400 19,865 

Norwegian Energy Co. A.S.A. * 20,288 18,248 

Petroleum Geo-Services A.S.A. 24,000 365,024 

Prosafe SE 25,600 195,696 

Songa Offshore SE * 22,400 51,703 

TGS Nopec Geophysical Co. A.S.A. 


11,840 346,053 

1,489,185 

Cermaq A.S.A. * 8,000 107,035 

Marine Harvest * 

Media 0.2% 

288,000 223,141 

330,176 

Schibsted A.S.A. 9,262 331,305 


Algeta A.S.A. * 


5,900 150,747 

Norwegian Property A.S.A. 75,548 109,165 


Nordic Semiconductor A.S.A. *(c) 26,485 72,242 

Renewable Energy Corp. A.S.A. *(c) 


54,400 16,285 

88,527 

Atea A.S.A. 15,083 140,610 

Opera Software A.S.A. 6,400 38,891 

179,501 

3,201,224 

Portugal 0.2% 


Sonae 142,899 90,782



Security 

Number 

of Shares 

Value 

($) 


Portucel-Empresa Produtora de Pasta 

e Papel S.A. 

Media 0.1% 

Zon Multimedia Servicos de 

Telecomunicacoes e Multimedia, 

23,915 63,817 

SGPS, S.A. 57,767 161,650 

316,249 



Nexen Tire Corp. 6,130 105,352 

S&T Dynamics Co., Ltd. 3,200 35,113 

Ssangyong Motor Co. * 

Banks 0.2% 

20,300 93,214 

233,679 

Jeonbuk Bank 18,054 71,842 

KB Financial Group, Inc. ADR 

Shinhan Financial Group Co., Ltd. 

3,500 113,260 

ADR 


Doosan Engineering & Construction 

1,755 110,319 

295,421 

Co., Ltd. * 

Hanjin Heavy Industries & 

14,500 35,272 

Construction Holdings Co., Ltd. 6,000 38,074 

Hyundai Elevator Co., Ltd. 969 80,449 

Kolon Global Corp. 7,200 25,986 

LG International Corp. 4,863 174,440 

LS Industrial Systems Co., Ltd. 976 55,483 

STX Engine Co., Ltd. 2,200 17,470 

Sung Kwang Bend Co., Ltd. 3,300 69,948 

Taihan Electric Wire Co., Ltd. * 18,020 28,905 

TK Corp. * 


3,300 82,891 

608,918 

Fila Korea Ltd. 1,500 100,077 

LG Fashion Corp. 2,000 58,433 

Youngone Corp. 4,000 121,450 

Youngone Holdings Co., Ltd. 


1,180 64,168 

344,128 

Hana Tour Service, Inc. 2,970 127,084 

Hotel Shilla Co., Ltd. 


7,420 351,177 

478,261 

KIWOOM Securities Co., Ltd. 1,800 96,138 

Macquarie Korea Infrastructure Fund 59,000 347,877 

TONGYANG Securities, Inc. 


27,220 93,202 

537,217 

Binggrae Co., Ltd. 960 72,425 

Daesang Corp. 14,040 219,641 

Samyang Holdings Corp. 1,310 65,233 

357,299 

Security 

Number 

of Shares 

Value 

($) 


Chabio & Diostech Co., Ltd. * 


6,400 53,135 

Korean Reinsurance Co. 15,300 149,005 

LIG Insurance Co., Ltd. 

Meritz Fire & Marine Insurance Co., 

6,400 138,196 

Ltd. 


19,082 211,905 

499,106 

Capro Corp. 2,950 38,220 

Kolon Industries, Inc. 1,920 108,638 

OCI Materials Co., Ltd. 1,706 69,540 

Poongsan Corp. 5,250 138,581 

Seah Besteel Corp. 5,890 183,507 

SK Chemicals Co., Ltd. 5,070 272,128 

Taekwang Industrial Co., Ltd. 70 55,155 

Young Poong Corp. 

Media 0.1% 

100 81,789 

947,558 

CJ CGV Co., Ltd. 2,000 49,708 

CJ E&M Corp. * 1,500 37,942 

SM Entertainment Co. * 1,728 85,439 

173,089 


Dong-A Pharmaceutical Co., Ltd. 3,000 252,771 

Green Cross Corp. 400 55,349 

Ilyang Pharmaceutical Co., Ltd. * 1,500 33,381 

LG Life Sciences Ltd. * 1,920 66,672 

Medipost Co., Ltd. * 701 66,849 

RNL BIO Co., Ltd. * 


10,000 43,274 

518,296 

CJ O Shopping Co., Ltd. 408 78,031 

Dongsuh Cos., Inc. 800 22,351 

GS Home Shopping, Inc. 448 41,972 

Himart Co., Ltd. 2,000 108,934 

Hyundai Greenfood Co. Ltd. 

Hyundai Home Shopping Network 

7,400 114,461 

Corp. 1,000 101,355 

467,104 


GemVax & Kael Co., Ltd. * 2,295 90,819 

Seoul Semiconductor Co., Ltd. 11,280 205,791 

Silicon Works Co., Ltd. 1,920 49,666 

Wonik IPS Co., Ltd. * 5,500 27,921 

374,197 


3S Korea Co., Ltd. * 4,157 56,788 

Daeduck Electronics Co., Ltd. 9,350 86,939 

Daeduck GDS Co., Ltd. 3,200 37,792 

LG Innotek Co., Ltd. * 2,750 217,649 

Partron Co., Ltd. 3,200 32,293 

SFA Engineering Corp. 


3,616 156,798 

588,259 

SK Broadband Co., Ltd. * 59,000 164,839 




Security 

Number 

of Shares 

Value 

($) 


Asiana Airlines, Inc. * 


12,280 83,553 

Samchully Co., Ltd. 590 52,520 

6,776,579 

Singapore 2.3% 


Gallant Venture Ltd. * 320,000 71,830 

STX OSV Holdings Ltd. (c) 


64,000 77,986 

149,816 

China Hongxing Sports Ltd. *(a)(b) 

Energy 0.3% 

884,000 — 

Ezion Holdings Ltd. (c) 64,000 54,129 

Ezra Holdings Ltd. *(c) 144,000 124,098 

Sakari Resources Ltd. (c) 144,000 215,873 

Swiber Holdings Ltd. *(c) 


64,000 30,271 

424,371 

GMG Global Ltd. 1,216,000 118,929 

Super Group Ltd. 64,000 103,639 

222,568 


Biosensors International Group Ltd. * 128,000 126,727 

Raffles Medical Group Ltd. 


64,000 121,597 

248,324 

CDL Hospitality Trusts 144,000 234,343 

Fortune Real Estate Investment Trust 128,000 92,911 

Lippo Malls Indonesia Retail Trust 192,000 66,955 

Mapletree Commercial Trust 128,000 112,875 

Mapletree Industrial Trust 128,000 139,554 

Mapletree Logistics Trust 

Parkway Life Real Estate Investment 

384,000 341,703 

Trust 64,000 98,509 

Suntec Real Estate Investment Trust 


420,000 486,532 

1,573,382 

CSE Global Ltd. 64,000 42,585 


LionGold Corp., Ltd. *(c) 


204,000 202,790 

Goodpack Ltd. 77,000 113,889 

SATS Ltd. 


192,000 401,731 

515,620 

Cityspring Infrastructure Trust 128,000 42,585 

Hyflux Ltd. (c) 192,000 209,331 

Sound Global Ltd. (c) 128,000 59,003 

310,919 

3,690,375 


Security 

Spain 1.3% 

Number 

of Shares 

Value 

($) 


Abengoa S.A. (c) 

Construcciones y Auxiliar de 

6,037 104,671 

Ferrocarriles S.A. 

Gamesa Corporacion Tecnologica 

476 213,569 

S.A. 17,124 32,053 

Obrascon Huarte Lain S.A. 9,108 191,382 

541,675 


Prosegur, Compagnia de Seguridad 

S.A. - Reg’d 


38,400 188,773 

Melia Hotels International S.A. 13,048 86,347 

NH Hoteles S.A. * 


25,600 79,865 

166,212 

Bolsas y Mercados Espanoles 

Energy 0.1% 

6,400 146,178 

Tecnicas Reunidas S.A. 


4,184 187,488 

Ebro Foods S.A. 12,818 210,688 

Viscofan S.A. 


3,767 167,188 

377,876 

Grupo Catalana Occidente S.A. 


8,139 122,085 

Ence Energia Y Celulosa S.A. 31,572 74,817 

Tubacex S.A. *(c) 

Media 0.0% 

28,025 60,230 

135,047 

Antena 3 de Television S.A. 11,983 51,658 


Almirall S.A. * 7,616 57,888 

Faes Farma S.A. 52,114 94,593 

Zeltia S.A. *(c) 48,606 87,919 

240,400 

2,157,392 

Sweden 2.5% 


Lindab International AB 9,952 71,540 

NCC AB, B Shares 9,998 182,698 

Peab AB 27,032 120,103 

Trelleborg AB, B Shares 31,183 323,996 

698,337 


Intrum Justitia AB 3,200 47,239 

Loomis AB, B Shares 


11,049 144,335 

191,574 

JM AB 


8,681 149,127 

Betsson AB * 4,560 134,975



Security 

Number 

of Shares 

Value 

($) 

Rezidor Hotel Group AB * 30,732 106,746 

SkiStar AB 


3,834 47,045 

288,766 

Avanza Bank Holding AB 5,562 110,036 

Investment AB Oresund * 4,480 63,090 

L E Lundbergforetagen AB, B Shares 


5,706 192,422 

365,548 

Axfood AB 5,568 196,766 

Hakon Invest AB 


5,480 84,662 

281,428 

AarhusKarlshamn AB 


7,728 273,681 

Billerud AB 10,250 84,750 

Hoganas AB, B Shares 3,755 123,907 

208,657 


Meda AB, A Shares 


22,924 226,067 

Castellum AB 22,790 304,766 

Fabege AB 19,648 174,473 

Hufvudstaden AB, A Shares 16,009 196,678 

Kungsleden AB 23,188 122,915 

Wallenstam AB, B Shares 12,800 139,760 

Wihlborgs Fastigheter AB 


7,966 116,092 

1,054,684 

Mekonomen AB 2,688 82,406 


Axis Communications AB (c) 5,465 130,814 

3,951,089 



Rieter Holding AG - Reg’d * 

Banks 0.2% 

748 110,637 

Basler Kantonalbank 680 74,596 

St. Galler Kantonalbank AG - Reg’d 340 119,210 

Valiant Holding AG - Reg’d * 


2,050 165,382 

359,188 

Belimo Holding AG - Reg’d 72 129,548 

Bucher Industries AG - Reg’d 1,280 214,990 

Georg Fischer AG - Reg’d * 680 247,166 

Huber & Suhner AG - Reg’d 3,369 138,990 

Kaba Holding AG, B Shares - Reg’d 680 264,476 

Meyer Burger Technology AG *(c) 5,202 75,633 

OC Oerlikon Corp. AG - Reg’d * 29,071 258,789 

Schweiter Technologies AG * 152 73,080 

Zehnder Group AG 768 43,495 

1,446,167 


Gategroup Holding AG * 1,600 38,631 

Security 

Number 

of Shares 

Value 

($) 


Forbo Holding AG - Reg’d * 


476 267,332 

Kuoni Reisen Holding AG - Reg’d * 


Bank Sarasin & Cie AG, B Shares - 

408 101,679 

Reg’d * 5,418 153,281 

Vontobel Holding AG - Reg’d 4,967 113,668 

266,949 


Galenica AG - Reg’d 


576 337,401 

Helvetia Holding AG - Reg’d 816 269,402 


Tecan Group AG - Reg’d * 


1,867 127,688 

Allreal Holding AG - Reg’d * 1,288 187,264 

Mobimo Holding AG - Reg’d * 


960 222,314 

409,578 

Dufry AG - Reg’d * 2,298 281,279 

Valora Holding AG - Reg’d 


408 65,873 

347,152 

Temenos Group AG - Reg’d * 6,632 94,335 


Ascom Holding AG - Reg’d * 

Logitech International S.A. - 

5,624 41,327 

Reg’d *(c) 


22,726 211,848 

253,175 

Flughafen Zuerich AG - Reg’d 

Panalpina Welttransport Holding AG - 

408 157,401 

Reg’d 2,458 231,582 

388,983 

4,818,297 


Banks 0.1% 

Paragon Group Cos. plc 


51,981 156,129 

Ashtead Group plc 58,560 263,601 

Balfour Beatty plc 70,114 312,269 

Bodycote plc 23,192 128,267 

Carillion plc 50,186 221,283 

Chemring Group plc 21,826 114,056 

Cookson Group plc 34,196 325,348 

Fenner plc 22,144 122,330 

Galliford Try plc 6,400 64,805 

Kier Group plc 4,480 91,865 

Melrose plc 139,356 523,926 

Morgan Crucible Co. plc 31,360 128,013 

Qinetiq Group plc 78,897 214,291 

Senior plc 64,000 200,666 

SIG plc 90,688 141,235 

Spirax-Sarco Engineering plc 10,386 324,818 




Security 

Number 

of Shares 

Value 

($) 

Travis Perkins plc 25,600 417,190 

Ultra Electronics Holdings plc 8,681 211,791 

3,805,754 


Babcock International Group plc 38,400 571,501 

Berendsen plc 27,104 233,765 

Cape plc 12,800 49,282 

De La Rue plc 13,667 226,631 

Homeserve plc 40,776 143,134 

ITE Group plc 49,097 158,150 

Michael Page International plc 42,123 242,468 

Mitie Group plc 53,195 241,563 

Regus plc 109,255 180,650 

RPS Group plc 40,046 154,374 

Shanks Group plc 44,800 63,900 

Sthree plc 12,800 58,096 

WS Atkins plc 


17,439 183,231 

2,506,745 

Barratt Developments plc * 119,360 284,378 

Bellway plc 18,242 251,790 

Bovis Homes Group plc 15,817 118,882 

Persimmon plc 32,320 358,322 

Redrow plc * 55,839 137,561 

Taylor Wimpey plc 397,760 323,788 

The Berkeley Group Holdings plc * 


11,588 265,780 

1,740,501 

Betfair Group plc 6,400 73,394 

Bwin.Party Digital Entertainment plc 89,600 133,920 

Dignity plc 9,105 130,880 

Domino’s Pizza Group plc 18,490 158,003 

Greene King plc 30,367 268,419 

J.D. Wetherspoon plc 20,232 143,935 

Marston’s plc 98,755 174,426 

Millennium & Copthorne Hotels plc 24,690 188,356 

Mitchells & Butlers plc * 51,619 220,551 

Rank Group plc 32,000 67,092 

Restaurant Group plc 


31,111 162,823 

1,721,799 

Aberdeen Asset Management plc 118,400 524,125 

Close Brothers Group plc 17,511 216,807 

Henderson Group plc 81,604 137,522 

IG Group Holdings plc 40,712 278,382 

Intermediate Capital Group plc 57,111 255,718 

International Personal Finance 44,073 202,520 

Jupiter Fund Management plc 32,000 114,564 

Provident Financial plc 16,000 335,460 

Rathbone Brothers plc 9,497 192,932 

Tullett Prebon plc 

Energy 0.9% 

30,223 139,214 

2,397,244 

Afren plc * 118,912 243,270 

Anglo Pacific Group plc 6,400 23,762 

Bumi plc * 13,760 69,501 

Enquest plc * 90,688 160,177 

Hunting plc 19,520 246,952 

Premier Oil plc * 59,200 351,579 


Security 

Number 

of Shares 

Value 

($) 

Salamander Energy plc * 45,861 142,773 

SOCO International plc * 


44,443 237,751 

1,475,765 

Booker Group plc 


136,675 205,365 

Britvic plc 36,711 186,359 

Cranswick plc 12,074 159,847 

Dairy Crest Group plc 31,653 171,944 

Devro plc 40,555 201,427 

Greggs plc 17,280 134,708 

854,285 


PZ Cussons plc 


26,667 128,764 

Amlin plc 55,604 340,557 

Beazley plc 92,843 244,353 

Catlin Group Ltd. 44,725 325,785 

Hiscox Ltd. 46,304 341,773 

Jardine Lloyd Thompson Group plc 18,797 229,296 

Lancashire Holdings Ltd. 20,672 263,003 

Phoenix Group Holdings 10,325 80,358 

St. James’s Place plc 


22,713 125,437 

1,950,562 

AZ Electronic Materials S.A. 32,000 157,971 

Centamin plc * 92,391 116,666 

Croda International plc 15,279 571,764 

DS Smith plc 140,312 359,926 

Elementis plc 32,000 111,921 

Filtrona plc 28,800 244,733 

Hochschild Mining plc (c) 23,895 164,149 

Kenmare Resources plc * 212,972 129,559 

Mondi plc 47,955 422,359 

Petropavlovsk plc 24,338 134,489 

RPC Group plc 6,400 44,209 

Talvivaara Mining Co. plc * 24,167 48,136 

Victrex plc 

Media 0.6% 

10,548 224,838 

2,730,720 

Informa plc 67,200 434,207 

Rightmove plc 10,240 261,536 

UBM plc 22,400 239,803 

935,546 


BTG plc * 44,800 215,040 

Dechra Pharmaceuticals plc 9,600 75,067 

Genus plc 7,465 162,560 

Hikma Pharmaceuticals plc 


20,076 232,780 

685,447 

Big Yellow Group plc 23,116 111,471 

Capital & Counties Properties plc 77,813 265,728 

Derwent London plc 10,332 314,596 

Grainger plc 49,025 76,311 

Great Portland Estates plc 40,339 281,791 

Helical Bar plc 19,704 57,117 

London & Stamford Property plc 32,000 61,145



Security 

Number 

of Shares 

Value 

($) 

Savills plc 22,190 137,880 

Shaftesbury plc 27,953 231,097 

Unite Group plc 


26,341 102,505 

1,639,641 

Carpetright plc *(c) 7,141 76,221 

Debenhams plc 200,135 306,759 

Dixons Retail plc * 286,711 79,922 

Dunelm Group plc 9,600 89,964 

Halfords Group plc 27,483 102,409 

Home Retail Group plc 82,880 123,547 

Howden Joinery Group plc 86,400 199,675 

Inchcape plc 49,280 288,439 

N Brown Group plc 38,400 163,277 

Ocado Group plc *(c) 32,262 31,002 

Sports Direct International plc * 9,604 46,679 

WH Smith plc 15,360 146,504 

1,654,398 


CSR plc 21,067 108,952 

Wolfson Microelectronics plc * 


12,800 43,711 

152,663 

Aveva Group plc 7,796 229,453 

Computacenter plc 12,800 77,705 

Fidessa Group plc 6,253 142,225 

Micro Focus International plc 26,063 224,787 

SDL plc 6,400 65,364 

Telecity Group plc 17,920 247,630 

987,164 


Domino Printing Sciences plc 10,930 97,740 

Electrocomponents plc 58,605 206,928 

Halma plc 35,200 227,274 

Imagination Technologies Group plc * 29,760 282,198 

Laird plc 56,320 209,506 

Oxford Instruments plc 8,088 168,162 

Premier Farnell plc 57,600 174,927 

Renishaw plc 3,200 79,545 

Rotork plc 10,345 361,164 

Spectris plc 10,375 284,924 

Spirent Communications plc 


Cable & Wireless Communications 

90,688 228,310 

2,320,678 

plc 153,028 82,520 

Colt Group S.A. * 75,548 140,756 

Kcom Group plc 57,600 71,361 

TalkTalk Telecom Group plc 


64,000 197,210 

491,847 

BBA Aviation plc 54,400 164,258 

easyJet plc 26,936 227,182 

FirstGroup plc 57,418 223,440 

Go-Ahead Group plc 9,046 186,787 

National Express Group plc 71,920 248,231 

Stagecoach Group plc 70,964 323,043 

Security 

Number 

of Shares 

Value 

($) 

Stobart Group Ltd. 


75,548 134,396 

1,507,337 

Pennon Group plc 


36,639 428,610 

30,476,964 

(Cost $165,608,987) 157,289,538 

Other Investment Companies 0.4% of net assets 


BB Biotech AG - Reg’d * 1,646 155,080 

Schroder ImmoPLUS 144 172,177 

Swisscanto Real Estate Fund Ifca 882 111,199 

438,456 


F&C Commercial Property Trust Ltd. 68,004 112,227 

United States 0.0% 


Government Money Market Fund 

Total Other Investment Companies 

49,398 49,398 

(Cost $533,441) 600,081 


Germany 0.5% 


Jungheinrich AG 1,841 57,434 

KSB AG 


136 60,840 

118,274 

Fuchs Petrolub AG 

Media 0.2% 

6,150 360,471 

ProSiebenSat.1 Media AG 12,763 308,161 


Biotest AG 


640 32,838 

(Cost $787,961) 819,744 

Rights 0.0% of net assets 



GrainCorp Ltd. *(a) 


3,491 1,467 

FKP Property Group *(a)(b) 171,129 17,685 

19,152 




Security 

Norway 0.0% 

Number 

of Shares 

Value 

($) 


Renewable Energy Corp. 

A.S.A. *(a)(b) 

Total Rights 

34,244 1,383 

(Cost $—) 20,535 



assets 


Government Money Market Fund 5,730,800 5,730,800 


(Cost $5,730,800) 5,730,800 







(a) Fair-valued by management in accordance with procedures 


(b) Illiquid security. At the period end, the value of these amounted 

to $19,068 or 0% of net assets. 

(c) All or a portion of this security is on loan. 

(d) Securities exempt from registration under Rule 144A of the 

Securities Act of 1933, as amended. These securities may be 

resold in transactions exempt from registrations, normally to 

qualified institutional buyers. At the period end, the value of 

these amounted to $246,441 or 0.2% of net assets. 



REIT — Real Estate Investment Trust 



Description 




(Level 1) 



(Level 2) 

Significant 

Unobservable 




$157,289,538 $— $— $157,289,538 

Other Investment Companies 1 

600,081 — — 600,081 


819,744 — — 819,744 

Rights 1 

— — 20,535 20,535 

Total 


$158,709,363 $— $20,535 $158,729,898 




value: 


Balance 

as of 

August 31, 

2011 

Realized 

Gains 

(Losses) 

Change in 

Unrealized 

Gains 

(Losses) 

Gross 

Purchases 

Gross 

Sales 

Gross 

Transfers 

in 

Gross 

Transfers 

out 

Balance 

as of 

August 31, 

2012 

Common Stock 

China $63,455 $— ($63,455) $— $— $— $— $— 

Hong Kong 

Rights 

47,513 (33,059) (6,678) — (7,776) — — — 

Australia — — 19,152 — — — — 19,152 

Norway — — 1,383 — — — — 1,383 

Total $110,968 ($33,059) ($49,598) $— ($7,776) $— $— $20,535 






August 31, 2012 are ($42,920). 


no transfers between Level 1, Level 2 and Level 3 for the period ended August 31, 2012. 



Statement of 



Assets 



Foreign currency, at value (cost $536,532) 543,100 

Receivables: 

Dividends 279,315 

Foreign tax reclaims 48,057 




Liabilities 


Payables: 

5,730,800 

Investment adviser fees � 4,595 


Net Assets 



Net assets $159,609,601 








Shares 


$159,609,601 6,400,000 $24.94 



Statement of 

Operations 



Dividends (net of foreign withholding tax of $354,309) $4,415,607 

Interest 170 



Expenses 


Total expenses � 534,208 



Net realized losses on investments (8,403,953) 

Net realized gains on in-kind redemptions 2,225,079 

Net realized losses on foreign currency transactions � (66,874) 


Net unrealized losses on investments (8,325,384) 

Net unrealized gains on foreign currency translations � 6,239 






Statements of 



Operations 

9/1/11-8/31/12 9/1/10-8/31/11 


Net realized gains (losses) (6,245,748) 1,158,799 

Net unrealized gains (losses) � (8,319,145) 2,001,625 

Net increase (decrease) in net assets resulting from operations (10,515,611) 6,306,458 




9/1/11-8/31/12 9/1/10-8/31/11 


Shares sold 900,000 $23,266,002 3,800,000 $110,560,371 

Shares redeemed � (400,001) (10,419,659) (400,000) (11,449,115) 

Net transactions in fund shares 499,999 $12,846,343 3,400,000 $99,111,256 


9/1/11-8/31/12 9/1/10-8/31/11 



Total increase � 499,999 (2,529,099) 3,400,000 103,290,993 

End of period 6,400,000 $159,609,601 5,900,001 $162,138,700 



Schwab Emerging Markets Equity ETFÏ 




9/1/11– 

8/31/12 

9/1/10– 

8/31/11 

1/13/10 1 – 

8/31/10 




Net realized and unrealized gains (losses) (2.51) 1.41 2 

(0.97) 



(1.88) 2.03 (0.70) 

Distributions from net investment income (0.57) (0.23) — 


Total return (%) (7.04) 8.31 (2.80) 3 



Net operating expenses 0.25 0.25 0.30 4,5 




9 9 23 3 


1 

Commencement of operations. 

2 

The per share amount does not accord with the change in aggregate gains and losses in securities during the period because of the timing 

of sales and repurchases of fund shares in relation to fluctuating market values. 

3 

Not annualized. 

4 

Annualized. 

5 

Effective June 14, 2010, the annual operating expense was reduced. The ratio presented for period ended 8/31/10 is a blended rate. 

6 



Schwab Emerging Markets Equity ETF 














Cost 

($) 

Value 

($) 

92.7% Common Stock 513,775,712 477,817,874 

0.0% Corporate Bonds 752 257 

6.7% Preferred Stock 44,216,997 34,274,447 

0.0% Rights — 23,654 


Company 1,195,351 1,195,351 

99.6% Total Investments 559,188,812 513,311,583 


Securities on Loan 4,594,077 4,594,077 

(0.5)% Other Assets and 

Liabilities, Net (2,310,174) 

100.0% Net Assets 515,595,486 

Security 


Brazil 10.1% 

Number 

of Shares 

Value 

($) 

Banks 1.7% 

Banco Bradesco S.A. ADR 307,380 5,047,180 

Banco do Brasil S.A. 

Banco Santander Brasil S.A. 

174,400 1,992,357 

ADR 123,388 935,281 

Itau Unibanco Holding S.A. 


43,600 607,892 

8,582,710 

Embraer S.A. ADR 29,328 790,390 

Weg S.A. 43,600 431,906 

1,222,296 


Cyrela Brazil Realty S.A. 

Empreendimentos e 

Participacoes 

MRV Engenharia e 

53,192 432,813 

Participacoes S.A. 

PDG Realty S.A. 

Empreendimentos e 

52,320 303,753 

Participacoes 


195,328 380,250 

1,116,816 

BM&FBOVESPA S.A. 

CETIP S.A. - Mercados 

351,888 1,864,319 

Organizados 22,903 294,605 


Security 

Number 

of Shares 

Value 

($) 

Grupo BTG Pactual 

Energy 1.6% 

OGX Petroleo e Gas 

29,328 451,689 

2,610,613 

Participacoes S.A. * 196,200 609,182 

OSX Brasil S.A. * 8,696 47,786 

Petroleo Brasileiro S.A. ADR 302,148 6,387,409 

Ultrapar Participacoes S.A. ADR 


63,656 1,392,793 

8,437,170 

BRF - Brasil Foods S.A. ADR 


175,944 2,834,458 

Americas ADR (a) 21,800 675,146 

Cosan S.A. Industria e Comercio 21,800 363,145 

JBS S.A. * 91,560 260,369 

Souza Cruz S.A. 109,000 1,461,713 

5,594,831 


Amil Participacoes S.A. 21,800 221,325 


Hypermarcas S.A. * 29,328 188,336 

Natura Cosmeticos S.A. 


43,600 1,093,734 

1,282,070 

Porto Seguro S.A. 17,440 161,073 

Sul America S.A. 


11,093 78,836 

239,909 

Braskem S.A. ADR (a) 

Companhia Siderurgica Nacional 

21,800 274,026 

S.A. ADR 172,002 829,050 

Duratex S.A. 51,998 312,903 

Fibria Celulose S.A. ADR *(a) 10,900 84,257 

Gerdau S.A. 21,800 159,010 

Gerdau S.A. ADR 

MMX Mineracao e Metalicos 

139,084 1,242,020 

S.A. * 

Usinas Siderurgicas de Minas 

43,600 117,109 

Gerais S.A. 43,600 203,705 

Vale S.A. ADR 


263,920 4,320,370 

7,542,450 

BR Malls Participacoes S.A. 

Multiplan Empreendimentos 

68,096 849,082 

Imobiliarios S.A. 


10,900 278,805 

1,127,887 

Cia Hering 17,222 376,430 

Lojas Americanas S.A. 19,512 127,416 

Lojas Renner S.A. 


21,800 718,985 

1,222,831 

Cielo S.A. 41,628 1,231,166 

Redecard S.A. 87,200 1,441,837 

2,673,003



Security 

Number 

of Shares 

Value 

($) 


Oi S.A. ADR (a) 164,817 613,119 

Oi S.A. ADR 28,122 124,581 

Telefonica Brasil S.A. ADR 33,790 722,092 

Tim Participacoes S.A. 42,225 167,939 

Tim Participacoes S.A. ADR 


34,069 664,686 

2,292,417 

All America Latina Logistica S.A. 131,672 579,498 

CCR S.A. 


Centrais Eletricas Brasileiras 

261,600 2,351,635 

2,931,133 

S.A. ADR 

Companhia de Saneamento 

Basico do Estado de Sao 

73,684 478,946 

Paulo ADR 

Companhia Energetica de Minas 

8,720 742,159 

Gerais ADR 

Companhia Paranaense de 

89,929 1,528,793 

Energia ADR 21,800 387,822 

CPFL Energia S.A. ADR 21,582 452,790 

EDP - Energias do Brasil S.A. 65,400 418,047 

Light S.A. 21,800 264,516 

Tractebel Energia S.A. 43,600 725,431 

4,998,504 

52,095,965 

Chile 2.5% 

Banks 0.5% 

Banco de Chile 16,608 2,339 

Banco de Chile ADR (a) 9,784 824,400 

Banco de Credito e Inversiones 4,423 278,981 

Banco Santander Chile ADR 11,336 842,151 

Corpbanca S.A. 

Sociedad Matriz Banco de Chile 

32,225,077 383,776 

S.A., B Shares 


845,120 286,792 

2,618,439 

Empresas Copec S.A. 


81,096 1,167,999 

Cencosud S.A. 


149,428 866,172 

Cia Cervecerias Unidas S.A. 


16,350 213,309 

Cap S.A. 21,364 719,562 

Empresas CMPC S.A. 

Sociedad Quimica y Minera de 

210,588 782,328 

Chile S.A. ADR 


20,146 1,241,799 

2,743,689 

S.A.C.I. Falabella 144,534 1,316,454 


Empresa Nacional de 

Telecomunicaciones S.A. 


8,720 168,169 

Lan Airlines S.A. ADR (a) 58,648 1,383,506 

Security 

Number 

of Shares 

Value 

($) 


Colbun S.A. * 

Empresa Nacional de 

1,997,534 566,031 

Electricidad S.A. ADR 23,789 1,171,846 

Enersis S.A. ADR 43,600 718,092 

2,455,969 

12,933,706 

China 16.5% 


Brilliance China Automotive 

Holdings Ltd. * 

Dongfeng Motor Group Co., Ltd., 

592,000 578,548 

H Shares 

Great Wall Motor Co., Ltd., H 

506,000 654,986 

Shares (a) 

Guangzhou Automobile Group 

225,000 508,235 

Co., Ltd., H Shares 

Banks 4.4% 

Agricultural Bank of China Ltd., 

215,662 150,425 

1,892,194 

H Shares 3,488,000 1,286,147 

Bank of China Ltd., H Shares 

Bank of Communications Co., 

13,496,000 4,906,846 

Ltd., H Shares 

China CITIC Bank Corp., Ltd., H 

1,402,200 916,571 

Shares 

China Construction Bank Corp., 

1,806,800 861,906 

H Shares 

China Merchants Bank Co., Ltd., 

11,554,000 7,597,151 

H Shares 

China Minsheng Banking Corp., 

562,658 970,619 

Ltd., H Shares (a) 

Chongqing Rural Commercial 

872,100 710,610 

Bank, H Shares 

Industrial & Commercial Bank of 

73,684 30,210 

China Ltd., H Shares 


Beijing Enterprises Holdings 

10,300,936 5,577,944 

22,858,004 

Ltd. 

China Communications 

Construction Co., Ltd., H 

109,000 720,928 

Shares 

China International Marine 

Containers (Group) Co., Ltd., 

872,000 670,056 

B Shares 

China Railway Construction 

367,000 463,230 

Corp., Ltd., H Shares (a) 

China Railway Group Ltd., H 

327,000 247,055 

Shares 436,000 164,141 

Citic Pacific Ltd. (a) 218,000 266,729 

CITIC Resources Holdings Ltd. * 436,000 53,964 

CSR Corp., Ltd., H Shares (a) 

Metallurgical Corp. of China Ltd., 

464,000 314,668 

H Shares *(a) 

Shanghai Electric Group Co., 

298,000 63,010 

Ltd., H Shares 436,000 174,822 




Security 

Number 

of Shares 

Value 

($) 

Shanghai Industrial Holdings 

Ltd. 

Shanghai Waigaoqiao Free 

Trade Zone Development 

218,000 598,666 

Co., Ltd., B Shares 

Shanghai Zhenhua Heavy 

43,600 28,776 

Industry Co., Ltd., B Shares * 

Weichai Power Co., Ltd., H 

675,800 202,064 

Shares (a) 

Zhuzhou CSR Times Electric 

30,000 79,291 


Zoomlion Heavy Industry 

Science & Technology Co., 

74,000 178,602 

Ltd., H Shares (a) 190,100 203,427 

4,429,429 


Tianjin Capital Environmental 

Protection Group Co., Ltd., H 

Shares 


Shanghai Haixin Group Co., B 

52,000 11,397 

Shares * 

Weiqiao Textile Co., Ltd., H 

109,000 43,382 

Shares 


Shanghai Jinjiang International 

Hotels Development Co., 

148,000 51,329 

94,711 

Ltd., B Shares 


21,800 27,359 

China Everbright Ltd. 

CITIC Securities Co., Ltd., H 

100,000 121,579 

Shares (a) 70,000 117,505 

Far East Horizon Ltd. 

Haitong Securities Co., Ltd., H 

296,000 205,316 

Shares * 

Energy 3.3% 

China Coal Energy Co., H 

162,800 178,621 

623,021 

Shares 

China Oilfield Services Ltd., H 

654,000 544,701 

Shares 

China Petroleum & Chemical 

436,000 695,914 

Corp., H Shares 

China Shenhua Energy Co., Ltd., 

3,052,000 2,872,470 

H Shares 436,000 1,588,010 

CNOOC Ltd. 

Inner Mongolia Yitai Coal Co., 

2,616,000 4,951,217 

Ltd., B Shares 152,600 831,060 

Kunlun Energy Co., Ltd. 436,000 745,381 

PetroChina Co., Ltd., H Shares 

Yanzhou Coal Mining Co., Ltd., H 

3,488,000 4,204,712 

Shares 


Lianhua Supermarket Holdings 

436,000 621,713 

17,055,178 

Co., Ltd., H Shares (a) 

Shanghai Friendship Group, Inc. 

100,000 87,027 

Ltd., B Shares 59,200 64,942 


Security 

Number 

of Shares 

Value 

($) 

Wumart Stores, Inc., H Shares 


Anhui Gujing Distillery Co., Ltd., 

80,000 134,911 

286,880 

B Shares 

China Agri-Industries Holdings 

13,000 39,388 

Ltd. 218,000 107,929 

China Foods Ltd. (a) 

Tsingtao Brewery Co., Ltd., H 

180,000 179,159 

Shares 

Yantai Changyu Pioneer Wine 

80,000 429,073 

Co., Ltd., B Shares 28,580 158,371 

913,920 


Shandong Weigao Group 

Medical Polymer Co., Ltd., H 

Shares 

Shanghai Pharmaceuticals 

176,000 193,784 

Holding Co., Ltd., H Shares 109,000 186,064 

Sinopharm Group Co., H Shares 


China Life Insurance Co., Ltd., H 

191,600 608,921 

988,769 

Shares 

China Pacific Insurance (Group) 

1,308,000 3,499,243 


China Taiping Insurance 

305,300 905,321 

Holdings Co., Ltd. * 

New China Life Insurance Co., 

218,000 290,620 


PICC Property & Casualty Co., 

28,000 83,932 

Ltd., H Shares 

Ping An Insurance (Group) Co., 

872,000 1,048,930 

H Shares 


Aluminum Corp. of China Ltd., H 

347,000 2,505,334 

8,333,380 

Shares *(a) 

Angang Steel Co., Ltd., H 

436,000 166,952 

Shares *(a) 

Anhui Conch Cement Co., Ltd., 

150,000 73,296 

H Shares (a) 218,000 544,139 

BBMG Corp., H Shares 

Bengang Steel Plates Co., B 

218,000 132,662 

Shares 

China BlueChemical Ltd., H 

109,000 31,760 

Shares 

China National Building Material 

872,000 502,542 

Co., Ltd., H Shares (a) 

China Resources Cement 

436,000 408,104 

Holdings Ltd. 

Jiangxi Copper Co., Ltd., H 

200,000 88,187 

Shares 

Maanshan Iron & Steel Co., Ltd., 

221,000 479,824 

H Shares *(a) 

Zhaojin Mining Industry Co., Ltd., 

436,000 87,130 

H Shares 109,000 144,186



Security 

Number 

of Shares 

Value 

($) 

Zijin Mining Group Co., Ltd., H 

Shares (a) 


China Overseas Land & 

1,308,000 409,791 

3,068,573 

Investment Ltd. 650,000 1,468,235 

China Resources Land Ltd. 436,000 842,067 

China Vanke Co., Ltd., B Shares 

Guangzhou R&F Properties Co., 

457,800 572,527 


Sino-Ocean Land Holdings 

217,200 250,909 

Ltd. (a) 872,000 391,240 

Yuexiu Property Co., Ltd. 


2,180,000 508,725 

4,033,703 

China Resources Enterprise Ltd. 178,000 528,980 


BOE Technology Group Co., Ltd., 

B Shares * 238,800 31,404 

BYD Co., Ltd., H Shares *(a) 80,000 139,449 

Lenovo Group Ltd. 1,308,000 1,062,420 

ZTE Corp., H Shares (a) 148,560 196,516 

1,429,789 


China Mobile Ltd. 

China Telecom Corp., Ltd., H 

981,000 10,472,432 

Shares 3,488,000 1,915,730 

China Unicom (Hong Kong) Ltd. 


872,000 1,380,585 

13,768,747 

Air China Ltd., H Shares 

China COSCO Holdings Co., 

872,000 525,027 

Ltd., H Shares *(a) 

China Merchants Holdings 

566,000 214,542 

International Co., Ltd. 

China Shipping Container Lines 

436,000 1,250,733 

Co., Ltd., H Shares *(a) 296,000 56,481 

Cosco Pacific Ltd. 

Guangdong Provincial 

Expressway Development 

436,000 537,956 

Co., Ltd., B Shares 

Jiangsu Expressway Co., Ltd., H 

87,200 25,633 

Shares 

Shanghai Jinjiang International 

Industrial Investment Co., 

96,000 79,090 

Ltd., B Shares 

Zhejiang Expressway Co., Ltd., H 

21,800 14,584 

Shares 


China Longyuan Power Group 

436,000 287,809 

2,991,855 

Corp., H Shares 

China Resources Power 

436,000 282,750 

Holdings Co., Ltd. 

Datang International Power 

Generation Co., Ltd., H 

436,000 932,007 

Shares 

Huadian Energy Co., Ltd., B 

1,308,000 438,459 

Shares * 174,400 39,066 

Security 

Number 

of Shares 

Value 

($) 

Huaneng Power International, 

Inc., H Shares 200,000 137,953 

1,830,235 

85,166,124 

Colombia 1.1% 

Banks 0.2% 

Bancolombia S.A. ADR 


Corp. Financiera Colombiana 

20,356 1,169,656 

S.A. 

Grupo de Inversiones 

25,724 465,401 

Suramericana S.A. 

Energy 0.5% 

28,340 471,091 

936,492 

Ecopetrol S.A. ADR 


46,870 2,711,429 

Almacenes Exito S.A. 


27,250 445,203 

Cementos Argos S.A. 


43,600 169,715 

Interconexion Electrica S.A. ESP 45,780 275,082 

Isagen S.A. ESP 38,368 51,851 

326,933 

5,759,428 

Czech Republic 0.5% 

Banks 0.1% 

Komercni Banka A/S 


2,834 550,041 

Telefonica Czech Republic A/S 


15,636 331,565 

CEZ A/S 34,880 1,369,833 

2,251,439 

Egypt 0.5% 

Banks 0.1% 

Commercial International Bank 

GDR - Reg’d 


Orascom Construction Industries 

132,980 678,198 

GDR 


Orascom Telecom Holding SAE 

30,302 1,362,075 

GDR - Reg’d * 

Orascom Telecom Media & 

Technology Holding SAE 

194,686 570,430 

GDR - Reg’d (b)(c) 176,826 82,578 

653,008 

2,693,281 




Security 

Hungary 0.4% 

Number 

of Shares 

Value 

($) 

Banks 0.1% 

OTP Bank plc 

Energy 0.2% 

53,628 850,935 

MOL Hungarian Oil & Gas plc 12,320 907,789 


Richter Gedeon Nyrt. 2,398 409,310 

2,168,034 



Bajaj Auto Ltd. 21,120 614,027 

Hero Motocorp Ltd. 13,953 442,232 

Mahindra & Mahindra Ltd. 40,548 556,300 

Maruti Suzuki India Ltd. 13,080 268,843 

Tata Motors Ltd. 

Banks 1.6% 

153,690 647,363 

2,528,765 

Axis Bank Ltd. 55,424 988,216 

Bank of Baroda 16,200 184,017 

Canara Bank 36,188 206,947 

HDFC Bank Ltd. 

Housing Development Finance 

184,210 1,971,585 

Corp., Ltd. 177,120 2,341,327 

ICICI Bank Ltd. 90,616 1,469,649 

State Bank of India 25,070 828,088 

Union Bank of India Ltd. 


43,820 123,484 

8,113,313 

Bharat Heavy Electricals Ltd. 122,080 468,019 

Cummins India Ltd. 26,160 216,334 

Jaiprakash Associates Ltd. 203,394 236,029 

Larsen & Toubro Ltd. 41,056 991,175 

Siemens Ltd. 13,298 162,098 

2,073,655 


Titan Industries Ltd. 


106,820 423,151 

Bajaj Holdings & Investment Ltd. 25,070 345,121 

IDFC Ltd. 204,048 491,733 

Kotak Mahindra Bank Ltd. 54,936 566,989 

Power Finance Corp., Ltd. 43,600 125,646 

Rural Electrification Corp., Ltd. 

Shriram Transport Finance Co., 

43,600 147,907 

Ltd. 

Energy 1.3% 

8,720 99,569 

1,776,965 

Bharat Petroleum Corp., Ltd. 64,092 385,819 

Cairn India Ltd. * 40,112 245,215 

Coal India Ltd. 87,854 555,079 

Hindustan Petroleum Corp., Ltd. 60,604 324,511 

Indian Oil Corp., Ltd. 60,168 262,360 

Oil & Natural Gas Corp., Ltd. 255,714 1,268,341 

Reliance Industries Ltd. 249,256 3,434,244 


Security 

Number 

of Shares 

Value 

($) 

The Great Eastern Shipping Co., 

Ltd. 


51,884 234,772 

6,710,341 

ITC Ltd. 900,248 4,331,710 

Nestle India Ltd. 5,668 472,322 

4,804,032 


Colgate-Palmolive (India) Ltd. 17,440 378,507 

Dabur India Ltd. 34,444 75,885 

Hindustan Unilever Ltd. 


120,772 1,118,376 

1,572,768 

Asian Paints Ltd. 4,696 307,357 

Hindalco Industries Ltd. 285,362 532,761 

Jindal Steel & Power Ltd. 74,774 473,378 

JSW Steel Ltd. 36,624 456,738 

Sesa Goa Ltd. 

Sterlite Industries (India) Ltd. 

75,210 231,816 

ADR 75,148 530,545 

Tata Chemicals Ltd. 58,424 320,242 

Tata Steel Ltd. 42,728 277,607 

Ultratech Cement Ltd. 

Media 0.1% 

Zee Entertainment Enterprises 

15,260 464,700 

3,595,144 

Ltd. 114,232 335,662 


Cipla Ltd. 113,796 770,130 

Dr. Reddys Laboratories Ltd. 17,876 539,124 

Lupin Ltd. 48,396 516,021 

Piramal Healthcare Ltd. 

Sun Pharmaceutical Industries 

14,170 122,302 

Ltd. 


62,130 746,565 

2,694,142 

DLF Ltd. 86,546 303,475 

Unitech Ltd. * 


482,384 159,566 

463,041 

HCL Technologies Ltd. 42,728 418,177 

Infosys Ltd. 91,560 3,887,329 

Mphasis Ltd. 

Satyam Computer Services 

13,080 90,437 

Ltd. * 40,984 68,706 

Tata Consultancy Services Ltd. 53,192 1,284,975 

Wipro Ltd. ADR 


73,220 569,652 

6,319,276 

Bharti Airtel Ltd. 265,960 1,184,807 

Idea Cellular Ltd. * 


Adani Ports & Special Economic 

288,632 387,351 

1,572,158 

Zone Ltd. 65,400 133,739 

Container Corp. Of India Ltd. 4,360 73,401 

207,140



Security 

Number 

of Shares 

Value 

($) 


GAIL India Ltd. 72,376 461,970 

NHPC Ltd. 218,000 70,152 

NTPC Ltd. 255,714 772,544 

Power Grid Corp. of India Ltd. 209,498 449,879 

Reliance Infrastructure Ltd. 19,620 156,642 

Reliance Power Ltd. * 121,644 166,639 

Tata Power Co., Ltd. 218,000 389,951 

Torrent Power Ltd. 10,900 29,060 

2,496,837 

45,686,390 

Indonesia 3.2% 


Astra International Tbk PT 

Banks 0.9% 

Bank Danamon Indonesia Tbk 

4,708,000 3,332,879 

PT 218,000 137,179 

PT Bank Central Asia Tbk 2,071,000 1,683,298 

PT Bank Mandiri (Persero) Tbk 

PT Bank Negara Indonesia 

1,417,459 1,159,537 

(Persero) Tbk 

PT Bank Rakyat Indonesia 

654,316 255,619 

(Persero) Tbk 


2,180,000 1,588,988 

4,824,621 

PT United Tractors Tbk 

Energy 0.2% 

436,000 916,812 

PT Adaro Energy Tbk 2,056,000 295,408 

PT Bumi Resources Tbk 

PT Tambang Batubara Bukit 

3,597,000 264,069 

Asam (Persero) Tbk 


Charoen Pokphand Indonesia 

218,000 333,802 

893,279 

Tbk PT 1,367,000 387,090 

PT Astra Agro Lestari Tbk 98,100 229,432 

PT Gudang Garam Tbk 

PT Indofood Sukses Makmur 

82,840 435,268 

Tbk 786,400 445,365 

1,497,155 


PT Unilever Indonesia Tbk 


PT Indocement Tunggal 

260,000 738,962 

Prakarsa Tbk 218,000 462,979 

PT Semen Gresik (Persero) Tbk 471,000 612,522 

PT Vale Indonesia Tbk 545,000 131,463 

1,206,964 


PT Kalbe Farma Tbk 1,090,000 442,973 


Indosat Tbk PT 

PT Telekomunikasi Indonesia 

148,000 79,161 

(Persero) Tbk 1,744,000 1,701,017 

1,780,178 

Security 

Number 

of Shares 

Value 

($) 


Jasa Marga Persero Tbk PT 


PT Perusahaan Gas Negara 

440,000 265,338 

(Persero) Tbk 1,744,000 676,749 

16,575,910 

Malaysia 5.0% 


UMW Holdings Berhad 

Banks 1.3% 

201,000 656,169 

Alliance Financial Group Berhad 352,200 465,542 

CIMB Group Holdings Berhad 821,600 2,048,412 

Hong Leong Bank Berhad 114,600 492,951 

Malayan Banking Berhad 

Public Bank Berhad - Foreign 

792,000 2,319,347 

Market 235,200 1,079,458 

RHB Capital Berhad 


114,600 267,015 

6,672,725 

Gamuda Berhad 481,800 531,992 

IJM Corp. Berhad 226,500 372,607 

Sime Darby Berhad 


719,400 2,258,702 

3,163,301 

Berjaya Sports Toto Berhad 201,000 283,696 

Genting Berhad 460,200 1,328,534 

Genting Malaysia Berhad 


516,300 583,306 

2,195,536 

AMMB Holdings Berhad 

Energy 0.1% 

438,600 891,378 

Petronas Dagangan Berhad 


British American Tobacco 

59,200 424,414 

Malaysia Berhad 

Felda Global Ventures Holdings 

21,800 445,001 

Berhad * 87,200 139,542 

IOI Corp. Berhad 790,800 1,300,916 

Kuala Lumpur Kepong Berhad 93,000 691,733 

PPB Group Berhad 93,000 413,730 

2,990,922 


IHH Healthcare Berhad * 


Lafarge Malayan Cement 

327,000 334,902 

Berhad 

Petronas Chemicals Group 

65,400 180,010 

Berhad 


457,800 949,446 

1,129,456 

SP Setia Berhad 363,000 413,596 

UEM Land Holdings Berhad * 


218,000 129,076 

542,672 

Axiata Group Berhad 1,056,000 2,024,465 




Security 

Number 

of Shares 

Value 

($) 

Digi.com Berhad 937,400 1,443,077 

Maxis Berhad 373,800 842,231 

Telekom Malaysia Berhad 


109,000 212,104 

4,521,877 

AirAsia Berhad 


283,400 312,924 

Petronas Gas Berhad 130,800 811,299 

Tenaga Nasional Berhad 218,250 477,782 

YTL Corp. Berhad 837,440 485,123 

YTL Power International Berhad 392,400 218,523 

1,992,727 

25,829,003 

Mexico 5.9% 

Banks 0.6% 

Grupo Financiero Banorte S.A.B. 

de C.V., O Shares 

Grupo Financiero Inbursa S.A.B. 

381,600 1,936,499 

de C.V., O Shares 


348,800 940,939 

2,877,438 

Alfa S.A.B. de C.V., A Shares 

Grupo Carso S.A.B. de C.V., 

34,360 541,813 

Series A1 


Organizacion Soriana S.A.B. de 

152,600 499,726 

1,041,539 

C.V., B Shares 

Wal-Mart de Mexico S.A.B. de 

29,600 87,800 

C.V., Series V 


1,172,800 3,113,370 

3,201,170 

Arca Continental S.A.B. de C.V. 

Coca-Cola Femsa S.A.B. de C.V., 

43,600 272,467 

Series L 

Fomento Economico Mexicano 

77,600 941,960 

S.A.B. de C.V. 

Grupo Bimbo S.A.B. de C.V., 

392,600 3,293,089 

Series A 

Grupo Modelo S.A.B. de C.V., 

305,200 660,775 

Series C 109,000 981,625 

6,149,916 


Kimberly-Clark de Mexico S.A.B. 

de C.V., A Shares 


Cemex S.A.B. de C.V., 

261,600 525,923 

Series CPO * 

Grupo Mexico S.A.B. de C.V., 

2,170,400 1,596,364 

Series B 792,000 2,337,284 

Industrias Penoles S.A.B. de C.V. 27,250 1,107,330 

Mexichem S.A.B. de C.V. 

Minera Frisco S.A.B. de C.V., 

113,297 503,580 

Series A1 * 130,800 498,295 

6,042,853 


Security 

Number 

of Shares 

Value 

($) 

Media 0.4% 

Grupo Televisa S.A.B., 

Series CPO 


499,200 2,287,372 

Grupo Elektra S.A. de C.V. 


America Movil S.A.B. de C.V., 

13,200 530,400 

Series L 5,952,800 7,607,154 

30,263,765 

Pakistan 0.0% 

Energy 0.0% 

Oil & Gas Development Co., Ltd. 

GDR - Reg’d (c) 9,984 177,715 

Peru 0.5% 

Banks 0.2% 

Credicorp Ltd. 


Companhia de Minas 

10,132 1,221,210 

Buenaventura S.A. ADR 42,074 1,458,285 

2,679,495 

Philippines 1.0% 

Banks 0.2% 

Bank of the Philippine Islands 377,379 672,690 

BDO Unibank, Inc. * 


304,760 442,201 

1,114,891 

Aboitiz Equity Ventures, Inc. 305,200 351,805 

DMCI Holdings, Inc. 152,600 209,995 

San Miguel Corp. 141,700 377,193 

SM Investments Corp. 


47,960 808,168 

1,747,161 

Jollibee Foods Corp. 


69,760 165,799 

Ayala Corp. 


26,400 257,882 

Ayala Land, Inc. 872,000 464,237 

SM Prime Holdings, Inc. 1,090,000 362,686 

826,923 


Philippine Long Distance 

Telephone Co. 


8,720 567,862 

Aboitiz Power Corp. 436,000 352,323 

Energy Development Corp. 1,876,800 266,745 

619,068 

5,299,586



Security 

Poland 1.4% 

Number 

of Shares 

Value 

($) 

Banks 0.5% 

Bank Handlowy w Warszawie 

S.A. 9,374 220,910 

Bank Pekao S.A. 19,620 890,448 

BRE Bank S.A. * 1,308 120,264 

Get Bank S.A. * 

Powszechna Kasa Oszczednosci 

322,920 145,972 

Bank Polski S.A. 

Energy 0.2% 

Polski Koncern Naftowy Orlen 

97,446 1,045,438 

2,423,032 

S.A. * 

Polskie Gornictwo Naftowe I 

46,434 546,439 

Gazownictwo S.A. * 


Powszechny Zaklad 

239,800 294,122 

840,561 

Ubezpieczen S.A. 


Jastrzebska Spolka Weglowa 

10,900 1,134,903 

S.A. 8,800 232,842 

KGHM Polska Miedz S.A. 26,392 1,033,156 

Synthos S.A. 


43,400 71,411 

1,337,409 

Telekomunikacja Polska S.A. 


105,294 526,740 

PGE S.A. 173,092 974,924 

Tauron Polska Energia S.A. 95,048 139,781 

1,114,705 

7,377,350 

Russia 6.6% 

Banks 0.9% 

Sberbank of Russia ADR 360,628 4,150,828 

VTB Bank OJSC GDR - Reg’d 

Energy 3.8% 

204,484 668,663 

4,819,491 

Gazprom OAO ADR 750,112 7,249,832 

LUKOIL OAO ADR 102,242 5,807,346 

NovaTek OAO GDR - Reg’d 

Rosneft Oil Co. OJSC GDR - 

15,696 1,872,533 

Reg’d 319,344 1,887,323 

Surgutneftegas OAO ADR 119,028 1,034,353 

Tatneft OAO ADR 


44,254 1,689,175 

19,540,562 

Magnit OJSC GDR - Reg’d 


53,080 1,692,721 

MMC Norilsk Nickel OJSC ADR 

Novolipetsk Steel OJSC GDR - 

82,840 1,212,778 

Reg’d 12,644 228,603 

Severstal OAO GDR - Reg’d 48,832 553,755 

Security 

Number 

of Shares 

Value 

($) 

Uralkali OJSC GDR - Reg’d 40,548 1,567,586 

3,562,722 


Pharmstandard OJSC GDR - 

Reg’d * 


5,450 78,753 

LSR Group GDR - Reg’d 


9,680 39,930 

Mobile TeleSystems OJSC ADR 87,976 1,619,638 

Rostelecom OJSC ADR 40,112 918,565 

Sistema JSFC GDR - Reg’d 


Federal Hydrogenerating Co. 

20,644 406,893 

2,945,096 

JSC ADR 566,832 1,401,209 

34,080,484 

South Africa 10.7% 

Banks 1.1% 

ABSA Group Ltd. 59,732 1,008,113 

Nedbank Group Ltd. 42,510 933,066 

Standard Bank Group Ltd. 


260,984 3,437,056 

5,378,235 

Aveng Ltd. 85,892 313,567 

Barloworld Ltd. 38,586 325,041 

Bidvest Group Ltd. 57,552 1,392,965 

Reunert Ltd. 37,496 316,570 

2,348,143 


Steinhoff International Holdings 

Ltd. * 


291,279 907,860 

Sun International Ltd. 


17,440 175,880 

African Bank Investments Ltd. 130,800 504,360 

FirstRand Ltd. 707,192 2,303,188 

Investec Ltd. 55,154 333,404 

JSE Ltd. 29,032 243,527 

Remgro Ltd. 83,930 1,432,939 

RMB Holdings Ltd. 

Energy 0.9% 

159,794 689,341 

5,506,759 

Sasol Ltd. 


101,588 4,371,954 

Clicks Group Ltd. 41,056 280,088 

Massmart Holdings Ltd. 17,282 348,880 

Pick n Pay Stores Ltd. 46,216 243,623 

Shoprite Holdings Ltd. 89,598 1,796,425 

The Spar Group Ltd. 


38,804 570,423 

3,239,439 

AVI Ltd. 84,802 583,558 

Tiger Brands Ltd. 27,468 902,401 

1,485,959 




Security 

Number 

of Shares 

Value 

($) 


Life Healthcare Group Holdings 

Ltd. 132,762 502,475 

Mediclinic International Ltd. 43,600 226,315 

Netcare Ltd. 


242,198 503,735 

1,232,525 

Discovery Holdings Ltd. 70,196 480,383 

MMI Holdings Ltd. 243,070 561,208 

Sanlam Ltd. 


362,970 1,592,529 

2,634,120 

AECI Ltd. 26,596 261,905 

African Rainbow Minerals Ltd. 15,696 273,751 

Anglo American Platinum Ltd. 17,004 845,187 

AngloGold Ashanti Ltd. 60,822 1,897,075 

ArcelorMittal South Africa Ltd. * 27,468 132,313 

Exxaro Resources Ltd. 14,606 259,298 

Gold Fields Ltd. 126,004 1,510,374 

Harmony Gold Mining Co., Ltd. 88,290 714,826 

Impala Platinum Holdings Ltd. 102,879 1,623,409 

Kumba Iron Ore Ltd. 15,696 893,881 

Mondi Ltd. 6,752 60,162 

Nampak Ltd. 140,174 449,867 

Northam Platinum Ltd. 

Pretoria Portland Cement Co., 

21,120 67,656 

Ltd. 102,678 324,048 

Sappi Ltd. * 

Media 0.7% 

24,048 67,050 

9,380,802 

Naspers Ltd., N Shares 65,618 3,806,988 


Aspen Pharmacare Holdings 

Ltd. * 


71,504 1,217,481 

Capital Property Fund 16,568 21,446 

Fountainhead Property Trust 287,478 285,824 

Growthpoint Properties Ltd. 346,184 1,126,633 

Hyprop Investments Ltd. 


2,398 20,911 

1,454,814 

Imperial Holdings Ltd. 39,028 945,313 

Mr. Price Group Ltd. 43,600 704,035 

The Foschini Group Ltd. 48,178 771,671 

Truworths International Ltd. 79,570 899,216 

Woolworths Holdings Ltd. 


150,638 1,072,347 

4,392,582 

Allied Technologies Ltd. 6,456 31,979 

MTN Group Ltd. 334,592 6,232,538 

Telkom SA Ltd. * 94,424 215,209 

Vodacom Group Ltd. 72,812 924,177 

7,403,903 

54,937,444 


Security 

Taiwan 13.0% 

Number 

of Shares 

Value 

($) 


Cheng Shin Rubber Industry Co., 

Ltd. 302,224 734,597 

China Motor Corp. 50,000 45,741 

Yulon Motor Co., Ltd. 

Banks 1.2% 

234,000 425,014 

1,205,352 

Chang Hwa Commercial Bank 

China Development Financial 

992,956 512,209 

Holding Corp. * 

Chinatrust Financial Holding Co., 

2,421,268 573,971 

Ltd. 1,968,380 1,176,388 

E.Sun Financial Holding Co., Ltd. 956,093 533,096 

First Financial Holding Co., Ltd. 

Hua Nan Financial Holdings Co., 

1,069,715 619,664 

Ltd. 1,387,668 745,933 

Mega Financial Holding Co., Ltd. 

SinoPac Financial Holdings Co., 

1,570,069 1,182,099 

Ltd. 

Taishin Financial Holding Co., 

899,049 357,206 

Ltd. 

Taiwan Cooperative Financial 

474,326 181,331 

Holding 


914,800 502,436 

6,384,333 

Far Eastern New Century Corp. 691,592 727,360 

Taiwan Glass Industrial Corp. 244,036 242,398 

Walsin Lihwa Corp. * 872,000 274,256 

1,244,014 


Taiwan Secom Co., Ltd. 


48,000 98,561 

Formosa Taffeta Co., Ltd. 218,000 198,704 

Giant Manufacturing Co., Ltd. 38,000 191,580 

Pou Chen Corp. 452,580 436,699 

Tatung Co., Ltd. * 


436,000 89,089 

916,072 

Capital Securities Corp. 

Fubon Financial Holding Co., 

673,629 228,284 

Ltd. 

Yuanta Financial Holding Co., 

1,200,078 1,192,024 

Ltd. 

Energy 0.2% 

1,773,316 822,981 

2,243,289 

Formosa Petrochemical Corp. 


296,000 843,992 

President Chain Store Corp. 


111,000 591,116 

Uni-President Enterprises Corp. 


Cathay Financial Holding Co., 

814,134 1,303,386 

Ltd. 1,171,551 1,118,706



Security 

Number 

of Shares 

Value 

($) 

Shin Kong Financial Holding 

Co., Ltd. * 


1,333,151 360,985 

1,479,691 

Asia Cement Corp. 459,187 527,396 

China Steel Corp. 1,845,519 1,580,500 

Feng Hsin Iron & Steel Co. 

Formosa Chemicals & Fibre 

60,000 92,751 

Corp. 684,000 1,765,323 

Formosa Plastics Corp. 1,090,000 2,936,897 

Nan Ya Plastics Corp. 1,308,000 2,458,696 

Oriental Union Chemical Corp. 91,300 102,271 

Taiwan Cement Corp. 623,690 677,811 

Taiwan Fertilizer Co., Ltd. 


Cathay Real Estate 

82,000 202,324 

10,343,969 

Development Co., Ltd. 


296,000 127,488 

Hotai Motor Co., Ltd. 50,000 360,589 


Advanced Semiconductor 

Engineering, Inc. 1,242,488 929,242 

Epistar Corp. 89,000 180,668 

Inotera Memories, Inc. * 557,000 95,403 

Macronix International Co., Ltd. 678,383 183,010 

MediaTek, Inc. 218,099 2,330,195 

MStar Semiconductor, Inc. 72,255 575,367 

Novatek Microelectronics Corp. 

Siliconware Precision Industries 

41,000 132,099 

Co. ADR 

Taiwan Semiconductor 

138,866 773,484 

Manufacturing Co., Ltd. ADR 

United Microelectronics Corp. 

830,148 12,203,176 

ADR 416,598 845,694 

18,248,338 


Acer, Inc. * 436,086 385,112 

Advantech Co., Ltd. 47,500 164,936 

Asustek Computer, Inc. 121,426 1,212,192 

AU Optronics Corp. ADR * 152,600 462,378 

Catcher Technology Co., Ltd. 

Cheng Uei Precision Industry 

108,000 539,080 

Co., Ltd. 70,929 140,906 

Chicony Electronics Co., Ltd. 85,956 181,377 

Chimei Innolux Corp. * 872,000 278,914 

Compal Communications, Inc. * 218,000 238,373 

Compal Electronics, Inc. 657,610 576,350 

Delta Electronics, Inc. 328,000 1,117,024 

Foxconn Technology Co., Ltd. 

Hon Hai Precision Industry Co., 

246,557 938,449 

Ltd. 1,931,880 5,469,715 

HTC Corp. 142,750 1,229,658 

Inventec Corp. 683,145 223,526 

Largan Precision Co., Ltd. 12,000 249,608 

Lite-On Technology Corp. 

Nan Ya Printed Circuit Board 

438,835 531,126 

Corp. 30,000 48,079 

Pegatron Corp. 244,441 306,459 

Quanta Computer, Inc. 436,000 1,125,265 

Security 

Number 

of Shares 

Value 

($) 

Synnex Technology International 

Corp. 224,053 499,708 

TPK Holding Co., Ltd. 32,396 418,592 

Unimicron Technology Corp. 436,000 495,670 

Wistron Corp. 478,891 535,636 

Yageo Corp. 


Chunghwa Telecom Co., Ltd. 

320,000 92,097 

17,460,230 

ADR (a) 

Far EasTone 

63,220 1,899,129 

Telecommunications Co., Ltd. 252,000 620,934 

Taiwan Mobile Co., Ltd. 


279,600 1,036,213 

3,556,276 

China Airlines Ltd. * 338,000 129,779 

Eva Airways Corp. * 268,000 150,325 

Evergreen Marine Corp., Ltd. 313,199 167,313 

U-Ming Marine Transport Corp. 

Yang Ming Marine Transport 

30,000 45,074 

Corp. 233,200 93,043 

585,534 

66,992,230 

Thailand 2.6% 

Banks 0.8% 

Bangkok Bank PCL NVDR 87,200 523,172 

Kasikornbank PCL NVDR 261,600 1,410,895 

Krung Thai Bank PCL NVDR 

Siam Commercial Bank PCL 

741,200 392,658 

NVDR 

Energy 0.6% 

327,000 1,565,342 

3,892,067 

Banpu PCL NVDR 21,800 313,069 

IRPC PCL NVDR 

PTT Exploration & Production 

2,637,800 316,519 

PCL NVDR 218,000 1,036,605 

PTT PCL NVDR 130,800 1,377,501 

Thai Oil PCL NVDR 


87,200 182,275 

3,225,969 

Big C Supercenter PCL NVDR 43,600 248,368 

CP ALL PCL NVDR 


Charoen Pokphand Foods PCL 

849,600 935,414 

1,183,782 

NVDR 675,800 684,750 


Bangkok Dusit Medical Services 

PCL NVDR 


59,200 195,538 

Indorama Ventures PCL NVDR 

PTT Global Chemical PCL 

218,000 200,016 

NVDR 225,014 448,807 

Siam Cement PCL NVDR 65,400 692,925 

1,341,748 




Security 

Number 

of Shares 

Value 

($) 

Media 0.1% 

BEC World PCL NVDR 


152,600 253,238 

Central Pattana PCL NVDR 87,200 146,794 

Land & Houses PCL NVDR 


Advanced Info Service PCL 

436,000 112,705 

259,499 

NVDR 

Total Access Communication 

196,200 1,358,717 

PCL NVDR 


65,400 182,101 

1,540,818 

Airports of Thailand PCL NVDR 

Thai Airways International PCL 

65,400 140,359 

NVDR * 


Electricity Generating PCL 

65,400 42,995 

183,354 

NVDR 43,600 166,970 

Glow Energy PCL NVDR 97,900 195,269 

362,239 

13,123,002 

Turkey 2.0% 


Ford Otomotiv Sanayi A/S 

Banks 0.9% 

15,260 149,826 

Akbank T.A.S. 261,420 1,032,422 

Turkiye Garanti Bankasi A/S 262,908 1,127,957 

Turkiye Halk Bankasi A/S 82,186 741,371 

Turkiye Is Bankasi, C Shares 

Turkiye Vakiflar Bankasi Tao, D 

262,908 801,139 

Shares 186,504 422,649 

Yapi ve Kredi Bankasi A/S * 


Dogan Sirketler Grubu Holdings 

169,386 395,037 

4,520,575 

A/S * 304,096 140,502 

Enka Insaat ve Sanayi A/S 41,589 115,293 

KOC Holding A/S 156,110 635,414 

891,209 


Arcelik A/S 

Turkiye Sise ve Cam Fabrikalari 

32,482 179,736 

A/S 


67,660 99,366 

279,102 

Haci Omer Sabanci Holding A/S 

Energy 0.1% 

Tupras-Turkiye Petrol Rafinerileri 

129,320 556,246 

A/S 


20,492 468,891 

BIM Birlesik Magazalar A/S 15,696 645,349 


Security 

Number 

of Shares 

Value 

($) 


Anadolu Efes Biracilik ve Malt 

Sanayii A/S 


Eregli Demir ve Celik Fabrikalari 

40,984 572,588 

T.A.S. 


Emlak Konut Gayrimenkul 

315,637 352,434 

Yatirim Ortakligi A/S 


135,160 197,753 

Turk Telekomunikasyon A/S 130,496 516,802 

Turkcell Iletisim Hizmetleri A/S * 


Turk Hava Yollari Anonim 

127,966 760,173 

1,276,975 

Ortakligi * 158,268 313,393 

10,224,341 

United Arab Emirates 0.3% 

Banks 0.1% 

Abu Dhabi Commercial Bank 

PJSC 92,088 84,491 

First Gulf Bank PJSC 


120,000 311,680 

396,171 

Dubai Financial Market * 

Energy 0.0% 

253,255 65,227 

Dana Gas PJSC * 


460,448 47,637 

Aldar Properties PJSC 192,704 62,958 

Emaar Properties PJSC 


495,540 446,566 

509,524 

DP World Ltd. 


47,512 484,623 

1,503,182 

(Cost $513,775,712) 477,817,874 

Security 

Rate, Maturity Date 

Corporate Bonds 0.0% of net assets 


Face Amount 

(local currency) 

Value 

($) 


Dr. Reddy’s Laboratories Ltd. 

9.25%, 03/24/14 (INR) 

Total Corporate Bond 

285,360 257 

(Cost $752) 257



Security 


Brazil 6.6% 

Number 

of Shares 

Value 

($) 

Banks 1.6% 

Itau Unibanco Holding S.A. ADR 361,448 5,714,493 

Itausa - Investimentos Itau S.A. 

Energy 1.8% 

494,847 2,280,288 

7,994,781 

Petroleo Brasileiro S.A. ADR 


Companhia Brasileira de 

Distribuicao Grupo Pao de 

450,388 9,268,985 

Acucar ADR 



21,800 934,784 

Americas ADR 


175,944 6,617,254 

Bradespar S.A. 43,600 569,429 

Klabin S.A. 109,000 488,849 

Metalurgica Gerdau S.A. 

Usinas Siderurgicas de Minas 

43,600 477,461 

Gerais S.A., A Shares 87,200 350,253 

Vale S.A. ADR 


333,322 5,373,151 

7,259,143 

Lojas Americanas S.A. 


96,562 695,286 

AES Tiete S.A. 

Centrais Eletricas Brasileiras 

21,800 298,145 

S.A. ADR 

Cia de Transmissao de Energia 

47,524 430,092 

Electrica Paulista 

Companhia Energetica de Sao 

4,159 92,443 

Paulo, B Shares 21,800 337,897 

1,158,577 

33,928,810 

Chile 0.0% 


Embotelladora Andina S.A., B 

Shares 20,274 110,850 

Colombia 0.1% 


Grupo de Inversiones 

Suramericana S.A. 


5,872 104,370 

Inversiones Argos S.A. 


13,516 130,417 

234,787 

(Cost $44,216,997) 34,274,447 

Security 

Rights 0.0% of net assets 

Thailand 0.0% 

Number 

of Shares 

Value 

($) 


KTB Investment & Securities 

Co., Ltd. *(c)(d) 

Total Rights 

185,300 23,654 

(Cost $—) 23,654 

Other Investment Company 0.2% of net assets 

United States 0.2% 


Government Money Market 

Fund 

Total Other Investment Company 

1,195,351 1,195,351 

(Cost $1,195,351) 1,195,351 



assets 


Government Money Market 

Fund 4,594,077 4,594,077 


(Cost $4,594,077) 4,594,077 







(a) All or a portion of this security is on loan. 

(b) Securities exempt from registration under Rule 144A of the 

Securities Act of 1933, as amended. These securities may be 

resold in transactions exempt from registrations, normally to 

qualified institutional buyers. At the period end, the value of 

these amounted to $82,578 or 0.0% of net assets. 

(c) Illiquid security. At the period end, the value of these amounted 

to $283,947 or 0.1% of net assets. 

(d) Fair-valued by management in accordance with procedures 



GDR — Global Depositary Receipt 

NVDR — Non-Voting Depositary Receipt 


INR — Indian Rupee 






Description 




(Level 1) 



(Level 2) 

Significant 

Unobservable 




$477,817,874 $— $— $477,817,874 

Corporate Bonds 1 

— 257 — 257 


34,274,447 — — 34,274,447 

Rights 1 

— — 23,654 23,654 

Other Investment Company 1 

1,195,351 — — 1,195,351 

Total 


$513,287,672 $257 $23,654 $513,311,583 




value: 


Balance 

as of 

August 31, 

2011 

Realized 

Gains 

(Losses) 

Change in 

Unrealized 

Gains 

(Losses) 

Gross 

Purchases 

Gross 

Sales 

Gross 

Transfers 

in 

Gross 

Transfers 

out 

Balance 

as of 

August 31, 

2012 

Rights $— $— $23,654 $— $— $— $— $23,654 

Total $— $— $23,654 $— $— $— $— $23,654 



August 31, 2012 are $23,654. 


no transfers between Level 1, Level 2 and Level 3 for the period ended August 31, 2012. 



Statement of 



Assets 



Foreign currency, at value (cost $600,597) 599,646 

Receivables: 

Dividends 1,686,519 


Foreign tax reclaims 731 



Liabilities 


Payables: 

4,594,077 

Investments bought 12 

Investment adviser fees � 10,627 


Net Assets 



Net assets $515,595,486 








Shares 


$515,595,486 21,800,000 $23.65 



Statement of 

Operations 



Dividends (net of foreign withholding tax of $1,726,010) $15,121,308 

Interest (net of foreign withholding tax of $71) 1,903 



Expenses 

Investment adviser fees 1,187,474 

Total expenses � 1,187,474 



Net realized losses on investments (net of foreign capital gains tax of $2,651) (16,191,170) 

Net realized gains on in-kind redemptions 2,277,963 

Net realized losses on foreign currency transactions* � (221,610) 


Net unrealized losses on investments (net of foreign capital gains tax of $177,964) (31,224,070) 

Net unrealized losses on foreign currency translations � (2,900) 




* Includes foreign currency acquisition costs on Brazilian real of $73,205 



Statements of 



Operations 

9/1/11-8/31/12 9/1/10-8/31/11 


Net realized losses (14,134,817) (3,072,159) 

Net unrealized losses � (31,226,970) (12,954,201) 

Net decrease in net assets resulting from operations (31,304,372) (6,821,558) 




9/1/11-8/31/12 9/1/10-8/31/11 


Shares sold 7,800,000 $186,779,297 9,600,000 $269,795,240 

Shares redeemed � (1,200,001) (27,004,871) (500,000) (12,298,874) 

Net transactions in fund shares 6,599,999 $159,774,426 9,100,000 $257,496,366 


9/1/11-8/31/12 9/1/10-8/31/11 



Total increase � 6,599,999 118,934,373 9,100,000 248,439,508 

End of period 21,800,000 $515,595,486 15,200,001 $396,661,113 




Financial Notes 

1. Business Structure of the Funds 

Each of the funds discussed in this report is a series of Schwab Strategic Trust (the “trust”), a no-load, open-end management 

investment company. The trust is organized as a Delaware statutory trust and is registered under the Investment Company Act 

of 1940, as amended (the “1940 Act”). The list below shows all the funds in the trust as of the end of the period, including the 

funds discussed in this report, which are highlighted: 

Schwab Strategic Trust (organized January 27, 2009) Schwab U.S. Mid-Cap ETF 

Schwab International Equity ETF Schwab U.S. Small-Cap ETF 

Schwab International Small-Cap Equity ETF Schwab U.S. Dividend Equity ETF 

Schwab Emerging Markets Equity ETF Schwab U.S. REIT ETF 

Schwab U.S. Broad Market ETF Schwab U.S. TIPS ETF 

Schwab U.S. Large-Cap ETF Schwab Short-Term U.S. Treasury ETF 

Schwab U.S. Large-Cap Growth ETF Schwab Intermediate-Term U.S. Treasury ETF 

Schwab U.S. Large-Cap Value ETF Schwab U.S. Aggregate Bond ETF 

The funds issue and redeem shares at their net assets value per share (“NAV”) only in large blocks of shares, typically 100,000 

shares or more (“Creation Units”). These transactions are usually in exchange for a basket of securities and an amount of cash. 

As a practical matter, only institutions or large investors purchase or redeem Creation Units. Except when aggregated in Creation 

Units, shares of the fund are not redeemable securities. 

Individual shares of the funds trade on national securities exchanges and elsewhere during the trading day and can only be 

bought and sold at market prices throughout the trading day through a broker-dealer. Because fund shares trade at market 

prices rather than NAV, shares may trade at a price greater than NAV (premium) or less than NAV (discount). 

Each fund maintains its own account for purposes of holding assets and accounting, and is considered a separate entity for tax 

purposes. Within its account, each fund may also keep certain assets in segregated accounts, as required by securities law. 

2. Significant Accounting Policies: 

The following is a summary of the significant accounting policies the funds use in their preparation of financial statements. The 

accounting policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). 

(a) Security Valuation: 

Under procedures approved by the funds’ Board of Trustees (the Board), the investment adviser and administrator have formed 

a Pricing Committee to administer the pricing and valuation of portfolio securities and other assets and to ensure that prices 

used for internal purposes or provided by third parties reasonably reflect fair market value. Among other things, these 

procedures allow the funds to utilize independent pricing services, quotations from securities and financial instrument dealers 

and other market sources to determine fair value. 

The funds value the securities in their portfolios every business day. The funds use the following policies to value various types 

of securities: 

72 

k Securities traded on an exchange or over-the-counter: valuedattheclosingvaluefortheday,or,ondayswhenno 

closing value has been reported at halfway between the most recent bid and ask quotes. Securities that are primarily traded 

on foreign exchanges are valued at the official closing price or the last sales price on the exchange where the securities are 

principally traded with these values then translated into U.S. dollars at the current exchange rate, unless these securities are 

fair valued as discussed below. 

k Securities for which no quoted value is available: The Board has adopted procedures to fair value each fund’s securities 

when market prices are not “readily available” or are unreliable. For example, a fund may fair value a security when it is 

de-listed or its trading is halted or suspended; when a security’s primary pricing source is unable or unwilling to provide a 

price; or when a security’s primary trading market is closed during regular market hours. Each fund makes fair value 

determinations in good faith in accordance with the fund’s valuation procedures. The Pricing Committee considers a 

number of factors, including unobservable market inputs when arriving at fair value. The Pricing Committee may employ 

techniques such as the review of related or comparable assets or liabilities, related market activity, recent transactions, 

market multiples, book values, transactional back-testing, disposition analysis and other relevant information. The Pricing


Financial Notes (continued) 

2. Significant Accounting Policies (continued): 

Committee regularly reviews these inputs and assumptions to calibrate the valuations. The Board convenes on a regular 

basis to review fair value determinations made by the funds pursuant to the procedures. 

k Bonds and notes: valued at halfway between the most recent bid and asked quotes or, if such quotes are unavailable, at 

prices for securities of comparable maturity, credit quality and type. Valuations for bonds and notes are provided by an 

independent bond-pricing service. 

k Short-term securities (60 days or less to maturity): valued at amortized cost, which approximates market value. 

k Underlying funds: valued at their respective net asset values. 

In accordance with the authoritative guidance on fair value measurements and disclosures under GAAP, the funds disclose the 

fair value of their investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure the fair value. 

The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets 

or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to 

the valuation (Level 3 measurements). If the funds determine that either the volume and/or level of activity for an asset or 

liability has significantly decreased (from normal conditions for that asset or liability) or price quotations or observable inputs 

are not associated with orderly transactions, increased analysis and management judgment will be required to estimate fair 

value. 

The three levels of the fair value hierarchy are as follows: 

k Level 1 — quoted prices in active markets for identical securities — Investments whose values are based on quoted market 

prices in active markets, and whose values are therefore classified as Level 1 prices, include active listed equities. The funds 

do not adjust the quoted prices for such investments, even in situations where the funds hold a large position and a sale 

could reasonably impact the quoted price. Investments in underlying funds are valued at their NAV daily and are classified 

as Level 1 prices. 

k Level 2 — other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment 

speeds, credit risk, etc.) — Investments that trade in markets that are not considered to be active, but whose values are 

based on quoted market prices, dealer quotations or valuations provided by alternative pricing sources supported by 

observable inputs are classified as Level 2 prices. These generally include U.S. government and sovereign obligations, most 

government agency securities, investment-grade corporate bonds, certain mortgage products, less liquid listed equities, and 

state, municipal and provincial obligations. As investments whose values are classified as Level 2 prices include positions 

that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect 

illiquidity and/or non-transferability, which are generally based on available market information. 

k Level 3 — significant unobservable inputs (including the funds’ own assumptions in determining the fair value of 

investments) — Investments whose values are classified as Level 3 prices have significant unobservable inputs, as they may 

trade infrequently or not at all. When observable prices are not available for these securities, the funds use one or more 

valuation techniques for which sufficient and reliable data is available. The inputs used by the funds in estimating the 

value of Level 3 prices may include the original transaction price, quoted prices for similar securities or assets in active 

markets, completed or pending third-party transactions in the underlying investment or comparable issuers, and changes 

in financial ratios or cash flows. Level 3 prices may also be adjusted to reflect illiquidity and/or non-transferability, with the 

amount of such discount estimated by the funds in the absence of market information. Assumptions used by the funds 

due to the lack of observable inputs may significantly impact the resulting fair value and therefore the funds’ results of 

operations. 

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in 

those securities. 

The levels associated with valuing the funds’ investments as of August 31, 2012 are disclosed in the Portfolio Holdings. 

(b) Accounting Policies for certain Portfolio Investments (if held): 

Securities Lending: Under the Securities Lending Program, a fund (the “lender”) may make short-term loans of its securities to 

another party (the “borrower”) to generate additional revenue for the fund. The borrower pledges collateral in the form of cash, 

73




securities issued or fully guaranteed by the U.S. government or foreign government, or letters of credit issued by a bank. 

Collateral at the individual loan level is required to have a value of at least 102% of the current market value of the loaned 

securities for securities traded on U.S. exchanges and a value of at least 105% for all other securities and is marked to market 

daily. The cash collateral of securities loaned is invested in money market portfolios registered under Rule 2a-7 of the 1940 Act. 

Securities lending income, as disclosed in a fund’s Statement of Operations, if applicable, represents the income earned from the 

investment of the cash collateral plus any fees paid by borrowers, less the fees paid to the lending agent which are subject to 

adjustments pursuant to the securities lending agreement. 

If applicable, the value of the securities on loan as of August 31, 2012 and the value of the related collateral are disclosed in the 

Portfolio Holdings and the Statement of Assets and Liabilities. 

(c) Security Transactions: 

Security transactions are recorded as of the date the order to buy or sell the security is executed. Realized gains and losses from 

security transactions are based on the identified costs of the securities involved. 

Assets and liabilities denominated in foreign currencies are reported in U.S. dollars. For assets and liabilities held on a given 

date, the dollar value is based on market exchange rates in effect on that date. Transactions involving foreign currencies, 

including purchases, sales, income receipts and expense payments, are calculated using exchange rates in effect on the transaction 

date. Realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the 

trade and settlement dates on securities transactions and the differences between the recorded amounts of dividends, interest, 

and foreign withholdings taxes and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign 

exchange gains and losses arise from changes in foreign exchange rates on foreign denominated assets and liabilities other than 

investments in securities held at the end of the reporting period. These realized and unrealized foreign exchange gains or losses 

are reported in foreign currency transactions or translations on the Statement of Operations. The funds do not isolate the 

portion of the fluctuations on investments resulting from changes in foreign currency exchange rates from the fluctuations in 

market prices of investments held. Such fluctuations are included with the net realized and unrealized gain or loss from 

investments. 

Gainsrealizedbythefundsonthesaleofsecuritiesincertainforeigncountriesmaybesubjecttonon-U.S.taxes.Inthose 

instances, the funds record a liability based on unrealized gains to provide for potential non-U.S. taxes payable upon the sale of 

these securities. 

(d) Investment Income: 

Interest income is recorded as it accrues. Dividends and distributions from portfolio securities and underlying funds are 

recorded on the date they are effective (the ex-dividend date), although the funds record certain foreign security dividends on 

the day they learn of the ex-dividend date. 

(e) Expenses: 

Expensesthatarespecifictoafundarechargeddirectlytothefund. 

(f) Distributions to Shareholders: 

The funds make distributions from net investment income and distribute net realized capital gains, if any, once a year. 

(g) Accounting Estimates: 

The accounting policies described in this report conform to accounting principles generally accepted in the United States of 

America. Notwithstanding this, shareholders should understand that in order to follow these principles, fund management has 

to make estimates and assumptions that affect the information reported in the financial statements. It’s possible that once the 

results are known, they may turn out to be different from these estimates and these differences may be material. 

74




(h) Federal Income Taxes: 

The funds intend to meet federal income and excise tax requirements for regulated investment companies. Accordingly, the 

funds distribute substantially all of their net investment income and realized net capital gains, if any, to their respective 

shareholders each year. As long as a fund meets the tax requirements, it is not required to pay federal income tax. 

(i) Foreign Taxes: 

The funds may be subject to foreign taxes (a portion of which may be reclaimable) on income, corporate events, foreign 

currency exchanges, capital gains on investments on currency repatriation. All foreign taxes are recorded in accordance with the 

applicable foreign tax regulations and rates that exist in foreign markets in which the funds invest. These foreign taxes, if any, are 

paid by the funds and are disclosed in the Statement of Operations. Foreign taxes payable as of August 31, 2012, if any, are 

reflected in the funds’ Statements of Assets and Liabilities. 

(j) Indemnification: 

Under the funds’ organizational documents, the officers and trustees are indemnified against certain liabilities arising out of the 

performance of their duties to the funds. In addition, in the normal course of business the funds enter into contracts with their 

vendors and others that provide general indemnifications. The funds’ maximum exposure under these arrangements is unknown 

as this would involve future claims that may be made against the funds. However, based on experience, the funds expect the risk 

of loss to be remote. 

(k) New Accounting Pronouncements: 

In December 2011, Accounting Standards Update (“ASU”) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities,” 

was issued and is effective for interim and annual periods beginning after January 1, 2013. The ASU enhances disclosure 

requirements with respect to an entity’s rights of offset and related arrangements associated with its financial and derivative 

instruments. Management is currently evaluating the impact the adoption of ASU 2011-11 may have on the funds’ financial 

statement disclosures. 

3. Risk Factors: 

Investing in the funds may involve certain risks, as discussed in the funds’ prospectus, including, but not limited to, those 

described below. Any of these risks could cause an investor to lose money. 

Stock markets rise and fall daily. As with any investment whose performance is tied to these markets, the value of the investment 

in a fund will fluctuate, which means that the investors could lose money. 

The funds are not actively managed. Therefore, a fund follows the securities included in an index during upturns as well as 

downturns. Because of their indexing strategies, the funds do not take steps to reduce market exposure or to lessen the effects of 

a declining market. In addition, because of a fund’s expenses, the fund’s performance is normally below that of the index. 

The prices of equity securities rise and fall daily. These price movements may result from factors affecting individual companies, 

industries or the securities market as a whole. In addition, equity markets tend to move in cycles, which may cause stock prices 

to fall over short or extended periods of time. 

Certain funds invest in large- and mid-cap stocks. Both large- and mid-cap stocks tend to go in and out of favor based on 

market and economic conditions. However, stocks of mid-cap companies tend to be more vulnerable to adverse business or 

economic events than larger more established companies. During a period when large- and mid-cap U.S. stocks fall behind other 

typesofinvestments—small-capstocks,forinstance—afund’slarge-andmid-capholdingscouldreduceperformance. 

Certain funds invest in small-cap stocks. Historically, small-cap stocks have been riskier than large- and mid-cap stocks, and 

their prices may move sharply, especially during market upturns and downturns. Small-cap companies may be more vulnerable 

to adverse business or economic events than larger, more established companies. During a period when small-cap stocks fall 

behind other types of investments — large-cap and mid-cap stocks, for instance — a fund’s small-cap holdings could reduce 

performance. 

75



3. Risk Factors (continued): 

A fund’s investments in securities of foreign issuers may involve certain risks that are greater than those associated with 

investments in securities of U.S. issuers. These include risks of adverse changes in foreign economic, political, regulatory and 

other conditions; changes in currency exchange rates or exchange control regulations (including limitations on currency 

movements and exchanges); differing accounting, auditing, financial reporting and legal standards and practices; differing 

securities market structures; and higher transaction costs. These risks may be heightened in connection with investments in 

emerging markets. Foreign securities also include ADRs, GDRs, and EDRs, which are receipts issued by U.S. and foreign banks 

that represent shares of foreign-based corporations. Investment in ADRs, GDRs and EDRs may be less liquid than the underlying 

shares in their primary trading market and GDRs, many of which are issued by companies in emerging markets, may be more 

volatile. 

Certain funds invest in emerging markets. Emerging markets may be more likely to experience political turmoil or rapid changes 

in market or economic conditions than more developed countries. Emerging market countries often have less uniformity in 

accounting and reporting requirements and greater risk associated with the custody of securities. It is sometimes difficult to 

obtain and enforce court judgments in such countries, and there is often a greater potential for nationalization and/or 

expropriation of assets by the government of an emerging market country. In addition, the financial stability of issuers 

(including governments) in emerging market countries may be more precarious than in other countries. As a result, there will 

tend to be an increased risk of price volatility associated with a fund’s investments in emerging market countries, which may be 

magnified by currency fluctuations relative to the U.S. dollar. 

To the extent a fund uses statistical sampling techniques, the fund may not fully replicate the index and may hold securities not 

included in the index. As a result, a fund is subject to the risk that the adviser’s investment management strategy, the 

implementation of which is subject to a number of constraints, may not produce the intended results. If a fund uses a sampling 

approach it may not track the return of the index as well as it would if a fund purchased all of the securities in its benchmark 

index. 

As an index fund, each fund seeks to track the performance of its benchmark index, although it may not be successful in doing 

so. The divergence between the performance of a fund and its benchmark index, positive or negative, is called “tracking error.” 

Tracking error can be caused by many factors and it may be significant. 

Each fund may invest in derivative instruments. The principal types of derivatives a fund may use are futures contracts. A 

futures contract is an agreement to buy or sell a financial instrument at a specific price on a specific day. A fund’s use of 

derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in 

securities and other traditional investments. Certain of these risks, such as market risk and liquidity risk, are discussed elsewhere 

in this section. A fund’s use of derivatives is also subject to leverage risk, credit risk, lack of availability risk, valuation risk, 

correlation risk and tax risk. Leverage risk is the risk that use of derivatives may magnify the effect of any decrease or increase in 

the value of the fund’s portfolio securities. Credit risk is the risk that the counterparty to a derivative transaction may not fulfill 

its contractual obligations. Lack of availability risk is the risk that suitable derivative transactions may not be available in all 

circumstances for risk management or other purposes. Valuation risk is the risk that a particular derivative may be valued 

incorrectly. Correlation risk is the risk that changes in the value of the derivative may not correlate perfectly with the underlying 

asset, rate or index. Tax risk is the risk that the use of derivatives may cause a fund to realize higher amounts of short-term 

capital gain. These risks could cause a fund to lose more than the principal amount invested. 

A particular investment may be difficult to purchase or sell. A fund may be unable to sell illiquid securities at an advantageous 

time or price. 

Securities lending involves the risk of loss of rights in the collateral or delay in recovery of the collateral if the borrower fails to 

return the security loaned or becomes insolvent. 

To the extent that a fund’s or an index’s portfolio is concentrated in the securities of issuers in a particular market, industry, 

group of industries, sector or asset class, the fund may be adversely affected by the performance of those securities, may be 

subject to increased price volatility and may be more susceptible to adverse economic, market, political or regulatory occurrences 

affecting that market, industry, group of industries, sector or asset class. 

76



3. Risk Factors (continued): 

Although fund shares are listed on national securities exchanges, there can be no assurance that an active trading market for 

fund shares will develop or be maintained. If an active market is not maintained, investors may find it difficult to buy or sell 

fund shares. 

Fund shares may be bought and sold in the secondary market at market prices. Although it is expected that the market price of 

thesharesofafundwillapproximateafund’sNAV,theremaybetimeswhenthemarketpriceandtheNAVvarysignificantly. 

Investors may pay more than NAV when they buy shares of a fund in the secondary market, and may receive less than NAV 

when they sell those shares in the secondary market. 

An investment in a fund is not a bank deposit and it is not insured or guaranteed by the Federal Deposit Insurance Corporation 

(FDIC) or any other government agency. 

Please refer to the funds’ prospectus for a more complete description of the principal risks of investing in the funds. 

4. Affiliates and Affiliated Transactions: 

Charles Schwab Investment Management, Inc. (“CSIM” or the “investment adviser”), a wholly owned subsidiary of The Charles 

Schwab Corporation, serves as each fund’s investment adviser pursuant to an Investment Advisory Agreement (“Advisory 

Agreement”) between CSIM and the trust. 

For its advisory services to the following funds, CSIM is entitled to receive an annual fee, payable monthly, based on a 

percentage of each fund’s average daily net assets as follows: 

Schwab 

International 

Equity ETF 

Schwab 


Small-Cap 

Equity ETF 

Schwab 

Emerging 

Markets 

Equity ETF 

0.13% 0.35% 0.25% 

Subsequent to the reporting period ended August 31, 2012, and effective September 20, 2012, the management fee of each fund 

has been reduced as follows: 

Schwab 


Equity ETF 

Schwab 


Small-Cap 

Equity ETF 

Schwab 

Emerging 

Markets 

Equity ETF 

0.09% 0.20% 0.15% 

The investment adviser will pay the operating expenses of the funds, excluding interest expenses, taxes, any brokerage expenses, 

and extraordinary or non-routine expenses. 

The funds may engage in certain transactions involving affiliates. For instance, a fund may own shares of The Charles Schwab 

Corporation if that company is included in its index. During the period ended August 31, 2012, there were no transactions 

involving affiliates. 

The funds may engage in direct transactions with certain other Schwab ETFs when practical. When one fund is seeking to sell a 

security that another is seeking to buy, an interfund transaction can allow both funds to benefit by reducing transaction costs. 

This practice is limited to funds that share the same investment adviser, trustees and/or officers. For the period ended August 31, 

2012, the funds had no direct security transactions with other Schwab ETFs. 

Pursuant to an exemptive order issued by the SEC, the funds may enter into interfund borrowing and lending transactions with 

other Schwab Funds including Schwab ETFs. All loans are for temporary or emergency purposes only. The interest rate charged 

on the loan is the average of the overnight repurchase agreement rate and the short-term bank loan rate. The interfund lending 

facility is subject to the oversight and periodic review of the Board of Trustees. The funds had no interfund borrowing or 

lending activity during the period. 

77



5. Other Service Providers: 

SEI Investments Distribution Co. (the “Distributor”) is the principal underwriter and distributor of shares of the funds. 

State Street Bank and Trust Company (“State Street”) serves as the funds’ transfer agent. As part of these services, the transfer 

agent maintains records pertaining to the sale, redemption and transfer of the funds’ shares. 

State Street also serves as custodian and accountant for the funds. The custodian is responsible for the daily safekeeping of 

securities and cash held or sold by the funds. The funds’ accountant maintains all books and records related to the funds’ 

transactions. 

6. Board of Trustees: 

Trustees may include people who are officers and/or directors of the investment adviser or its affiliate. Federal securities law 

limits the percentage of such “interested persons” who may serve on a trust’s board, and the trust was in compliance with these 

limitations throughout the report period. The trust did not pay any of these interested persons for their services as trustees. 

7. Borrowing from Banks: 

The funds have access to custodian overdraft facilities and to an uncommitted line of credit of $100 million with State Street. 

The funds pay interest on the amounts they borrow at rates that are negotiated periodically. 

There were no borrowings from the line of credit by the funds during the period. However, the funds may have utilized their 

overdraft facility and incurred interest expense, which is disclosed on the Statement of Operations, if any. The interest expense is 

determined based on a negotiated rate above the current Federal Funds Rate. 

8. Purchases and Sales/Maturities of Investment Securities: 

For the period ended August 31, 2012, purchases and sales/maturities of securities (excluding in-kind transactions and shortterm 

obligations) were as follows: 

Purchases of Securities Sales/Maturities of Securities 

Schwab International Equity ETF $74,259,096 $52,366,879 

Schwab International Small-Cap Equity ETF 41,142,402 37,723,487 

Schwab Emerging Markets Equity ETF 103,918,732 43,031,266 

9. In-Kind Transactions: 

The consideration for the purchase of Creation Units of a fund generally consists of the in-kind deposit of a designated portfolio 

of equity securities, which constitutes an optimized representation of the securities involved in a relevant fund’s underlying 

index, and an amount of cash. Investors purchasing and redeeming Creation Units may pay a purchase transaction fee and a 

redemption transaction fee directly to the applicable fund, to offset transfer and other transaction costs associated with the 

issuance and redemption of Creation Units. 

The in-kind transactions for the period ended August 31, 2012 were as follows: 

In-kind Purchases of Securities In-kind Sales of Securities 

Schwab International Equity ETF $138,562,880 $— 

Schwab International Small-Cap Equity ETF 20,513,159 10,069,724 


For the period ended August 31, 2012, certain funds realized net capital gains or losses resulting from in-kind redemptions of 

largeblocksofsharesormultiplesthereof(“CreationUnits”).Becausesuchgainsorlossesarenottaxabletothefundsandare 

not distributed to existing fund shareholders, the gains or losses are reclassified from accumulated net realized gains or losses to 

capital received from investors at the end of the funds’ tax year. These reclassifications have no effect on net assets or net asset 

values per share. The net realized in-kind gains or losses for the period ended August 31, 2012 are disclosed in the funds’ 

Statements of Operations. 

78



10. Federal Income Taxes 

As of August 31, 2012, the components of distributable earnings on a tax-basis were as follows: 

Schwab 


Equity ETF 

Schwab 


Small-Cap 

Equity ETF 

Schwab 

Emerging 

Markets 

Equity ETF 

Undistributed ordinary income $19,101,601 $4,190,265 $12,058,836 

Undistributed long-term capital gains — — — 

Unrealized appreciation 65,911,759 16,542,098 34,899,106 

Unrealized depreciation (94,720,939) (27,284,271) (82,603,122) 

Other unrealized appreciation/(depreciation) (1,113) 7,001 (2,434) 

Net unrealized appreciation/(depreciation) (28,810,293) (10,735,172) (47,706,450) 

The primary difference between book-basis and tax-basis unrealized appreciation or unrealized depreciation of investments is 

the tax deferral of losses on wash sales and Passive Foreign Investment Companies (PFIC). 

Capital loss carryforwards may be used to offset future realized capital gains for federal income tax purposes. As of August 31, 

2012, the following funds had capital loss carryforwards available to offset future net capital gains before the expiration dates: 

Expiration Date 

Schwab 


Equity ETF 

Schwab 


Small-Cap 

Equity ETF 

Schwab 

Emerging 

Markets 

Equity ETF 

August 31, 2019 $2,345,874 $215,545 $1,091,404 

No expiration 5,735,648 3,734,494 4,557,003 

Total $8,081,522 $3,950,039 $5,648,407 

For tax purposes, realized net capital losses and late-year ordinary losses incurred after October 31 may be deferred and treated 

as occurring on the first day of the following fiscal year. For the year ended August 31, 2012, the funds had capital losses deferred 

as follows: 

Schwab 


Equity ETF 

Schwab 


Small-Cap 

Equity ETF 

Schwab 

Emerging 

Markets 

Equity ETF 

Deferred capital losses $16,186,912 $6,450,568 $13,331,689 

The tax-basis components of distributions paid during the current and prior fiscal years were: 

Schwab 


Equity ETF 

Schwab 


Small-Cap 

Equity ETF 

Schwab 

Emerging 

Markets 

Equity ETF 

Current period distributions 

Ordinary Income $19,440,541 $4,859,831 $9,535,681 

Long-term capital gains 

Prior period distributions 

— — — 

Ordinary Income 7,027,040 2,126,721 2,235,300 

Long-term capital gains — — — 

Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which 

may differ from net investment income and net realized gains for financial reporting purposes. These differences are due 

primarily to differing treatment for items such as short-term capital gains and losses, in-kind transactions, capital losses related 

to wash sales and income on certain investments. The fiscal year in which amounts are distributed may differ from the year in 

79



10. Federal Income Taxes (continued): 

which the net investment income and net realized gains are recorded by the funds for financial reporting purposes. The funds 

may also designate a portion of the amount paid to redeeming shareholders as a distribution for tax purposes. 

The permanent book and tax basis differences may result in reclassifications between components of net assets as required. The 

adjustments have no impact on net assets or the results of operations. As of August 31, 2012, the funds made the following 

reclassifications: 

Schwab 


Equity ETF 

Schwab 


Small-Cap 

Equity ETF 

Schwab 

Emerging 

Markets 

Equity ETF 

Capital shares $— $2,052,221 $2,248,286 

Undistributed net investment income (273,517) 233,680 (187,529) 

Net realized gains and losses 273,517 (2,285,901) (2,060,757) 

For the period ended August 31, 2012, the following funds reclassified non-taxable security gains and losses realized on the inkind 

redemption of Creation Units (Note 9) as an increase or decrease to capital received from investors in the Statement of 

Assets and Liabilities as follows: 

Schwab 


Equity ETF 

Schwab 


Small-Cap 

Equity ETF 

Schwab 

Emerging 

Markets 

Equity ETF 

$— $2,225,079 $2,277,963 

As of August 31, 2012, management has reviewed the tax positions for open periods (for federal purposes, three years from the 

date of filing and for state purposes, four years from the date of filing) as applicable to the funds, and has determined that no 

provision for income tax is required in the funds’ financial statements. The funds recognize interest and penalties, if any, related 

to unrecognized tax benefits as income tax expense in the Statement of Operations. During the period ended August 31, 2012, 

the funds did not incur any interest or penalties. 

On December 22, 2010, the Regulated Investment Company Modernization Act of 2010 (“the Act”) was signed by the President. 

The Act is the first major piece of legislation affecting Regulated Investment Companies (“RICs”) since 1986 and it modernizes 

several of the federal income and excise tax provisions related to RICs. 

Certain of the enacted provisions include: 

Post-enactment capital losses may now be carried forward indefinitely, but must retain the character of the original loss. 

However, such losses must be utilized prior to the pre-enactment capital losses, which increases the likelihood that the preenactment 

capital losses will expire unused. Under pre-enactment law, capital losses could be carried forward for eight years, and 

carried forward as short-term capital loss, irrespective of the character of the original loss. The Act contains simplification 

provisions, which are aimed at preventing disqualification of a RIC for “inadvertent” failures of the asset diversification and/or 

qualifying income tests. Additionally, the Act exempts RICs from the preferential dividend rule, and repeals the 60-day 

designation requirement for certain types of pay-through income and gains. 

Finally, the Act contains several provisions aimed at preserving the character of distributions made by a fiscal year RIC during 

the portion of its taxable year ending after October 31 or December 31, reducing the circumstances under which a RIC might be 

required to file amended Forms 1099 to restate previously reported distributions. 

The funds have adopted the noted provisions of the Act for the period ending August 31, 2012. 

11. Subsequent Events: 

Management has determined there are no subsequent events or transactions through the date the financial statements were 

issued that would have materially impacted the financial statements as presented. 

80

Report of Independent Registered Public Accounting Firm 

To the Board of Trustees and Shareholders of: 




In our opinion, the accompanying statements of assets and liabilities, including the 

portfolio holdings, and the related statements of operations and of changes in net assets 

and the financial highlights present fairly, in all material respects, the financial position of 

Schwab International Equity ETF, Schwab International Small-Cap Equity ETF and Schwab 

Emerging Markets Equity ETF (three of the funds constituting Schwab Strategic Trust, 

hereafter referred to as the “Funds”) at August 31, 2012, and the results of their operations 

for the year then ended, changes in their net assets for each of the two years in the period 

then ended and the financial highlights for each of the three years or periods in the period 

then ended, in conformity with accounting principles generally accepted in the United 

States of America. These financial statements and financial highlights (hereafter referred to 

as “financial statements”) are the responsibility of the Funds’ management; our responsibility 

is to express an opinion on these financial statements based on our audits. We 

conducted our audits of these financial statements in accordance with the standards of the 

Public Company Accounting Oversight Board (United States). Those standards require that 

we plan and perform the audits to obtain reasonable assurance about whether the financial 

statements are free of material misstatement. An audit includes examining, on a test basis, 

evidence supporting the amounts and disclosures in the financial statements, assessing the 

accounting principles used and significant estimates made by management, and evaluating 

the overall financial statement presentation. We believe that our audits, which included 

confirmation of securities at August 31, 2012 by correspondence with the custodian and 

brokers, provide a reasonable basis for our opinion. 

PricewaterhouseCoopers LLP 

San Francisco, California 

October 18, 2012 

81

Other Federal Tax Information (unaudited) 

The funds may elect to pass on the benefits of the foreign tax credit to its shareholders for the period ended August 31, 2012, 

and the respective foreign source income on the funds as follows: 

Foreign Tax Credit Foreign Source Income 

Schwab International Equity ETF $1,662,947 $25,957,482 

Schwab International Small-Cap Equity ETF 282,713 4,769,916 


For the period ended August 31, 2012, the funds designated the following amounts of the dividend distributions as qualified 

dividends for the purpose of the maximum rate under section 1(h)(ii) of the Internal Revenue Code. Shareholders will be 

notified in January 2013 via IRS form 1099 of the amount for use in preparing their 2012 income tax return. 

Schwab International Equity ETF $17,005,828 

Schwab International Small-Cap Equity ETF 4,720,032 

Schwab Emerging Markets Equity ETF 9,535,681 

82

Other Information (unaudited) 

Frequency Distribution of Discounts and Premiums 

Bid/Offer Midpoint vs. NAV as of August 31, 2012 

The following charts are provided to show the frequency at which the daily market price on the NYSE Arca, Inc. (“Exchange”), 

the secondary market for shares of each fund, was at a discount or premium to such fund’s daily NAV. The market price of each 

fund generally is determined using the midpoint between the highest bid and lowest offer on the Exchange, as of the time that 

the fund’s NAV is calculated (referred to as the “Bid/Offer Midpoint”). Each fund’s Bid/Offer Midpoint may at times be at, 

above or below its NAV. The discount or premium is the percentage difference between the NAV and the Bid/Offer Midpoint of 

aFund.AdiscountistheamountthatafundistradingbelowthereportedNAV,expressedasapercentageofNAV.Apremium 

is the amount that a fund is trading above the reported NAV, expressed as a percentage of NAV. The NAV of each Fund will 

fluctuate with changes in the market value of its portfolio holdings. The Bid/Offer Midpoint of each fund will fluctuate in 

accordance with changes in its NAV, as well as supply and demand. 

Bid/Offer Midpoint Above NAV Bid/Offer Midpoint Below NAV 

50-99 

Basis Points 

100-199 

Basis Points 

H200 

Basis Points 

50-99 

Basis Points 

100-199 

Basis Points 

H200 

Basis Points 


Commencement of trading 

11/3/09 through 8/31/12 



272 99 10 42 18 2 

1/14/10 through 8/31/12 



227 109 1 44 20 5 

1/14/10 through 8/31/12 184 151 14 42 20 6 

83

Investment Advisory Agreement Approval 

The Investment Company Act of 1940 (the “1940 Act”) 

requires that initial approval of, as well as the continuation 

of, a fund’s investment advisory agreement must be specifically 

approved (1) by the vote of the trustees or by a vote of 

the shareholders of the fund, and (2) by the vote of a 

majority of the trustees who are not parties to the investment 

advisory agreement or “interested persons” of any party (the 

“Independent Trustees”), cast in person at a meeting called 

for the purpose of voting on such approval. In connection 

with such approvals, the fund’s trustees must request and 

evaluate, and the investment adviser is required to furnish, 

such information as may be reasonably necessary to evaluate 

the terms of the investment advisory agreement. 

The Board of Trustees (the “Board” or the “Trustees”, as 

appropriate) calls and holds a meeting each year that is 

dedicated, in part, to considering whether to renew the 

investment advisory agreement between Schwab Strategic 

Trust (the “Trust”) and Charles Schwab Investment Management, 

Inc. (“CSIM”) (the “Agreement”) with respect to the 

existing funds in the Trust, including Schwab International 

Equity ETF, Schwab International Small-Cap Equity ETF 

and Schwab Emerging Markets Equity ETF (the “Funds”), 

and to review certain other agreements pursuant to which 

CSIM provides investment advisory services to certain other 

registered investment companies. In preparation for the 

meeting(s), the Board requests and reviews a wide variety of 

materials provided by CSIM, including information about 

CSIM’s affiliates, personnel and operations. The Board also 

receives extensive data provided by third parties. This information 

is in addition to the detailed information about the 

FundthattheBoardreviewsduringthecourseofeachyear, 

including information that relates to Fund operations and 

Fund performance. In addition, the Independent Trustees 

meet in executive session outside the presence of fund 

management and participate in question and answer sessions 

with representatives of CSIM. 

The Board, including a majority of the Independent Trustees, 

considered information specifically relating to its consideration 

of the continuance of the Agreement with respect to 

the Funds at a meeting held on August 28, 2012, and 

approved the renewal of the Agreement with respect to the 

Funds for an additional one year term. The Board’s approval 

of the Agreement with respect to the Funds was based on 

consideration and evaluation of a variety of specific factors 

discussed at these meetings and at prior meetings, including: 

1. the nature, extent and quality of the services provided to 

the Funds under the Agreement, including the resources 

of CSIM and its affiliates dedicated to the Funds; 

2. each Fund’s investment performance and how it 

compared to that of certain other comparable exchangetraded 

funds; 

84 

3. each Fund’s expenses and how those expenses compared 

to those of certain other comparable exchange-traded 

funds; 

4. the profitability of CSIM and its affiliates, including 

Charles Schwab & Co., Inc. (“Schwab”), with respect to 

the Funds, including both direct and indirect benefits 

accruing to CSIM and its affiliates; and 

5. the extent to which economies of scale would be realized 

as the Funds grow and whether fee levels in the Agreement 

reflect those economies of scale for the benefit of 

fund investors. 

Nature, Extent and Quality of Services. The Board considered 

the nature, extent and quality of the services provided 

by CSIM to the Funds and the resources of CSIM and its 

affiliates dedicated to the Funds. In this regard, the Trustees 

evaluated, among other things, CSIM’s personnel, experience, 

track record and compliance program. The Trustees 

also considered Schwab’s wide range of products, services, 

and channel alternatives such as free advice, investment 

research tools and Internet access and an array of account 

features that benefit the Funds and their shareholders. The 

Trustees also considered Schwab’s excellent reputation as a 

full service brokerage firm and its overall financial condition. 

Finally, the Trustees considered that the vast majority of the 

Funds’ shareholders are also brokerage clients of Schwab. 

Following such evaluation, the Board concluded, within the 

context of its full deliberations, that the nature, extent and 

quality of services provided by CSIM to the Funds and the 

resources of CSIM and its affiliates dedicated to the funds 

supported renewal of the Agreement with respect to the 

Funds. 

Fund Performance. The Board considered each Fund’s 

performance in determining whether to renew the Agreement 

with respect to the Fund. Specifically, the Trustees 

considered each Fund’s performance relative to a peer 

category of other exchange-traded funds and appropriate 

indices/benchmarks, in light of total return, yield, if applicable, 

and market trends. As part of this review, the Trustees 

considered the composition of the peer category, selection 

criteria and the reputation of the third party who prepared 

the peer category analysis. In evaluating the performance of 

the Funds, the Trustees considered both risk and shareholder 

risk expectations for such Fund and the appropriateness of 

the benchmark used to compare the performance of the 

Fund. The Trustees further considered the level of Fund 

performance in the context of its review of Fund expenses 

and adviser profitability discussed below. Following such 

evaluation the Board concluded, within the context of its full 

deliberations, that the performance of the Fund supported 

renewal of the Agreement with respect to the Funds.

Fund Expenses. With respect to the Funds’ expenses, the 

Trustees considered the rate of compensation called for by 

the Agreement, and each Fund’s operating expense ratio, in 

comparison to those of other comparable exchange-traded 

funds, such peer groups and comparisons having been 

selected and calculated by an independent third party. The 

Trustees also considered fees charged by CSIM to mutual 

funds that it manages. Following such evaluation, the Board 

concluded, within the context of its full deliberations, that 

theexpensesoftheFundarereasonableandsupported 

renewal of the Agreement with respect to the Funds. 

Profitability. With regard to profitability, the Trustees 

considered the compensation flowing to CSIM and its affiliates, 

directly or indirectly. In this connection, the Trustees 

reviewed management’s profitability analyses. The Trustees 

also considered any other benefits derived by CSIM from its 

relationship with the Funds, such as whether, by virtue of its 

management of the Funds, CSIM obtains investment information 

or other research resources that aid it in providing 

advisory services to other clients. The Trustees considered 

whether the varied levels of compensation and profitability 

with respect to the Funds under the Agreement and other 

service agreements were reasonable and justified in light of 

the quality of all services rendered to the Funds by CSIM 

and its affiliates. Based on this evaluation, the Board 

concluded, within the context of its full deliberations, that 

the profitability of CSIM is reasonable and supported 

renewal of the Agreement with respect to the Funds. 

Economies of Scale. The Trustees considered the existence 

of any economies of scale and whether those are passed 

along to the Funds’ shareholders by way of the relatively low 

advisory fee and unitary fee structure of the Funds. Based on 

this evaluation, and in consideration of the previously negotiated 

commitments made by CSIM and Schwab as 

discussed above, the Board concluded, within the context of 

its full deliberations, that the Fund obtains reasonable benefit 

from economies of scale. 

In the course of their deliberations, the Trustees did not 

identify any particular information or factor that was all 

important or controlling. Based on the Trustees’ deliberation 

and their evaluation of the information described above, the 

Board, including all of the Independent Trustees, approved 

the continuation of the Agreement with respect to the Funds 

and concluded that the compensation under the Agreement 

withrespecttotheFundsisfairandreasonableinlightof 

such services and expenses and such other matters as the 

Trustees have considered to be relevant in the exercise of 

their reasonable judgment. 

85

Trustees and Officers 

The tables below give information about the trustees and officers for the Schwab Strategic Trust which includes the funds 

covered in this report. The “Fund Complex” includes the Charles Schwab Family of Funds, Schwab Capital Trust, Schwab 

Investments, Schwab Annuity Portfolios, Schwab Strategic Trust, Laudus Trust and Laudus Institutional Trust. The 

Fund Complex includes 91 funds. 

The address for all trustees and officers is 211 Main Street, San Francisco, CA 94105. You can find more information about the 

trustees and officers in the Statement of Additional Information, which is available free by calling 1-800-435-4000. 

Independent Trustees 

Name, Year of Birth, 

and Position(s) with 

the trust; (Terms of 

office, and length of 

Time Served 1 ) 

Robert W. Burns 

1959 

Trustee 

(Trustee of Schwab 

Strategic Trust since 2009.) 

Mark A. Goldfarb 

1952 

Trustee 



Charles A. Ruffel 

1956 

Trustee 



86 

Principal Occupations 

During the Past Five Years 

Retired (January 2009 – present). Consulting 

Managing Director, PIMCO (investment adviser) 

(January 2003 – December 2008); Managing 

Director, PIMCO (February 1999 – December 

2002); President and Trustee, PIMCO Funds 

and PIMCO Variable Insurance Trust 

(investments) (February 1994 – May 2005). 

Founder and Managing Director, SS&G, Inc. 

(certified public accountants and advisers) (May 

1987 – present). 

Advisor (January 2008 – present) and Chief 

Executive Officer (January 1998 – January 

2008), Asset International, Inc. (publisher of 

financial services information); Managing 

Partner and Co-Founder, Kudu Advisors, LLC 

(financial services) (June 2008 – present). 

Number of 

Portfolios in 

Fund Complex 

Overseen by 

the Trustee Other Directorships 

17 Director, PS Business Parks, Inc. 

(2005 – Feb. 2012). 

Trustee, PIMCO Funds (investment company 

consisting of 84 portfolios) (1997 – 2008). 

Trustee, PIMCO Variable Insurance Trust 

(investment company consisting of 16 

portfolios) (1997 – 2008). 

Director and Chairman, PIMCO Strategic 

Global Government Fund (investment 

company consisting of one portfolio) 

(1997 – 2008). 

Director, PCM Fund, Inc. (investment 

company consisting of one portfolio) 

(1997 – 2008). 

17 None 

17 None

Interested Trustees 

Name, Year of Birth, 

and Position(s) with 

the trust; (Terms of 

office, and length of 

Time Served ) 

Walter W. Bettinger II 2 

1960 

Trustee 



Officers of the Trust 

Principal Occupations 

During the Past Five Years 

As of October 2008, President and Chief 

Executive Officer, Charles Schwab & Co., Inc. 

and The Charles Schwab Corporation. Since 

October 2008, Director, The Charles Schwab 

Corporation. Since May 2008, Director, Charles 

Schwab & Co., Inc. and Schwab Holdings, Inc. 

Since 2006, Director, Charles Schwab Bank. 

From 2004 through 2007, Executive Vice 

President and President, Schwab Investor 

Services. From 2004 through 2005, Executive 

Vice President and Chief Operating Officer, 

Individual Investor Enterprise, and from 2002 

through 2004, Executive Vice President, 

Corporate Services. Until October 2008, 

President and Chief Operating Officer, Charles 

Schwab & Co., Inc. and The Charles Schwab 

Corporation. 

Number of 

Portfolios in 

Fund Complex 

Overseen by 

the Trustee Other Directorships 

91 None 

Name, Year of Birth, and Position(s) 

with the trust; (Terms of office, and 

length of Time Served 3 ) Principal Occupations During the Past Five Years 

Marie Chandoha 

1961 

President and Chief Executive Officer 

(Officer of Schwab Strategic Trust since 

2010.) 

George Pereira 

1964 

Treasurer and Principal Financial Officer 


2009.) 

Omar Aguilar 

1970 

Senior Vice President and Chief Investment 

Officer – Equities 


2011.) 

Brett Wander 

1961 

Senior Vice President and Chief Investment 

Officer – Fixed Income 


2011.) 

Executive Vice President, Charles Schwab & Co., Inc. (Sept. 2010 – present); Director, 

President and Chief Executive Officer (Dec. 2010 – present), Chief Investment Officer 

(Sept. 2010 – Oct. 2011), Charles Schwab Investment Management, Inc.; President, Chief 

Executive Officer (Dec. 2010 – present), and Chief Investment Officer (Sept. 2010 – Oct. 

2011), Schwab Funds, Laudus Funds and Schwab ETFs; Global Head of Fixed Income 

Business Division, BlackRock, Inc. (formerly Barclays Global Investors) (March 

2007 – August 2010); Co-Head and Senior Portfolio Manager, Wells Capital Management 

(June 1999 – March 2007). 

Senior Vice President and Chief Financial Officer (Nov. 2004 – present); Chief Operating 

Officer (Jan. 2011 – present), Charles Schwab Investment Management, Inc.; Treasurer and 

Chief Financial Officer, Laudus Funds (June 2006 – present); Treasurer and Principal 

Financial Officer, Schwab Funds (Nov. 2004 – present) and Schwab ETFs (Oct. 

2009 – present); Director, Charles Schwab Worldwide Fund, PLC and Charles Schwab 

Asset Management (Ireland) Limited (April 2005 – present); Treasurer, Chief Financial 

Officer and Chief Accounting Officer, Excelsior Funds Inc., Excelsior Tax-Exempt Funds, 

Inc., and Excelsior Funds Trust (June 2006 – June 2007). 

Senior Vice President and Chief Investment Officer — Equities, Charles Schwab Investment 

Management, Inc. (April 2011 – present); Senior Vice President and Chief Investment 

Officer — Equities, Schwab Funds and Laudus Funds (June 2011 – present); Head of the 

Portfolio Management Group and Vice President of Portfolio Management, Financial 

Engines, Inc. (May 2009 – April 2011); Head of Quantitative Equity, ING Investment 

Management (July 2004 – Jan. 2009). 

Senior Vice President and Chief Investment Officer – Fixed Income, Charles Schwab 

Investment Management, Inc. (April 2011 – present); Senior Vice President and Chief 

Investment Officer – Fixed Income, Schwab Funds and Laudus Funds (June 

2011 – present); Senior Managing Director, Global Head of Active Fixed Income 

Strategies, State Street Global Advisors (Jan. 2008 – Oct. 2010); Director of Alpha 

Strategies, Loomis, Sayles & Company (April 2006 – Jan. 2008); Managing Director, Head 

of Market-Based Strategies State Street Research (August 2003 – Jan. 2005). 

87

Officers of the Trust (continued) 

Name, Year of Birth, and Position(s) 

with the trust; (Terms of office, and 

length of Time Served 3 ) Principal Occupations During the Past Five Years 

David Lekich 

1964 

Secretary and Chief Legal Officer 


2011.) 

Catherine MacGregor 

1964 

Vice President and Assistant Secretary 


2009.) 

Senior Vice President, Charles Schwab & Co., Inc. (Sept. 2011 – present); Senior Vice 

President and Chief Counsel, Charles Schwab Investment Management Inc. (Sept. 

2011 – present); Vice President, Charles Schwab & Co., Inc., (March 2004 – Sept. 2011) 

and Charles Schwab Investment Management, Inc. (Jan 2011 – Sept. 2011); Secretary 

(April 2011 – present) and Chief Legal Officer (Dec. 2011 – present), Schwab Funds (April 

2011 – present); Vice President and Assistant Clerk, Laudus Funds (April 2011 – present); 

Secretary (May 2011 – present) and Chief Legal Officer (Nov. 2011 – present), Schwab 

ETFs. 

Vice President, Charles Schwab & Co., Inc., Charles Schwab Investment Management, Inc. 

(July 2005 – present); Vice President (Dec. 2005 – present), Chief Legal Officer and Clerk 

(March 2007 – present), Laudus Funds; Vice President (Nov. 2005 – present) and 

Assistant Secretary (June 2007 – present), Schwab Funds; Vice President and Assistant 

Secretary, Schwab ETFs (Oct. 2009 – present). 

1 

Each Trustee shall hold office until the election and qualification of his or her successor, or until he or she dies, resigns or is removed. The 

Trust’s retirement policy requires that independent trustees retire by December 31 of the year in which the Trustee turns 72 or the Trustee’s 

twentieth year of service as an independent trustee, whichever comes first. 

2 

Mr. Bettinger is an Interested Trustee because he owns stock of The Charles Schwab Corporation, the parent company of the investment 

adviser. 

3 

The President, Treasurer and Secretary hold office until their respective successors are chosen and qualified or until he or she sooner dies, 

resigns, is removed or becomes disqualified. Each of the other officers serves at the pleasure of the Board. 

88

Glossary 

American Depositary Receipt (ADR) U.S. dollar-denominated 

receipts issued by U.S. banks or trust companies that 

represent shares of foreign-based corporations. 

ask See “offer.” 

asset allocation The practice of dividing a portfolio among 

different asset classes, with each asset class assigned a 

particular percentage to help offset risks and rewards, based 

on your goals, time horizon and risk tolerance. 

asset class A group of securities with similar structure and 

basic characteristics. Stocks, bonds and cash are the three 

main examples of asset classes. 

authorized participant (AP) A large institutional investor 

that places orders for creation units with the funds’ 

distributor. 

beta A historical measure of an investment’s volatility relative 

to a market index (usually the S&P 500˛). The index is 

defined as having a beta of 1.00. Investments with a beta 

higher than 1.00 have been more volatile than the index; 

those with a beta of less than 1.00 have been less volatile. 

bid The highest price at which someone is willing to buy a 

security. 

cap, capitalization See “market cap.” 

capital gain, capital loss The difference between the 

amount paid for an investment and its value at a later time. If 

the investment has been sold, the capital gain or loss is 

considered a realized gain or loss. If the investment is still 

held, the gain or loss is still “on paper” and is considered 

unrealized. 

commencement of operations The date that the first 

NAV was calculated. 

creation unit (C.U.) A basket of securities that is delivered 

by an authorized participant (AP) to the fund equal to the 

current holdings of the ETF, plus a designated cash component. 

In return, the APs receive a large block of ETF shares 

(typically 50,000 shares), which investors can then buy and 

sell in the secondary market. 

exchange A marketplace, or any organization or group that 

provides or maintains a marketplace for trading securities, 

options, futures, or commodities. 

expense ratio The amount that is taken from the fund’s 

assets each year to cover the operating expenses. An 

expense ratio of 0.50% means that a fund’s expenses 

amount to half of one percent of its average net assets a 

year. 

gross domestic product (GDP) The output of goods and 

services produced by labor and property located in the 

United States. 

inception date The date that the shares began trading in 

the secondary market. 

indicative optimized portfolio value (IOPV) A calculation 

disseminated by the stock exchange that approximates the 

fund’s NAV every 15 seconds throughout the trading day. 

liquidity The ability to convert a security or asset quickly 

into cash. 

market cap, market capitalization The value of a 

company as determined by the total value of all shares of its 

stock outstanding. 

market price return The return based on the change in 

market price per share of the fund over a given time period. 

Market price returns assume that dividends and capital gain 

distributions have been reinvested in the fund at market 

price. 

median market cap The midpoint of the range of market 

caps of the stocks held by a fund. There are different ways 

of calculating median market cap. With a simple median, half 

of the stocks in the fund’s portfolio would be larger than the 

median, and half would be smaller. With a weighted median 

(the type that is calculated for these funds), half of the 

fund’s assets are invested in stocks that are larger than the 

median market cap, and half in stocks that are smaller. 

MSCI EAFE (Europe, Australasia, Far East) Index A free 

float-adjusted market capitalization index that is designed to 

measure the equity market performance of developed 

markets, excluding the U.S. & Canada. 

MSCI Emerging Markets Index A free float-adjusted 

market capitalization index that is designed to measure 

equity market performance of emerging markets. 

net asset value (NAV) The value of one share of a fund. 

NAV is calculated by taking the fund’s total assets, 

subtracting liabilities, and dividing by the number of shares 

outstanding. 

NAV return The return based on the change in NAV of the 

fund over a given time period. NAV returns assume that 

dividends and capital gain distributions have been reinvested 

in the fund. 

offer (ask) The lowest price at which an individual is willing 

to sell a security. 

open The price at which a security opened for trading on a 

given day. 

outstanding shares, shares outstanding When speaking 

of the fund, indicates all shares currently held by investors. 

price-to-book ratio (P/B) The market price of a company’s 

stock compared with its “book value.” A mutual fund’s 

P/B is the weighted average of the P/B of all stocks in the 

fund’s portfolio. 

price-to-earnings ratio (P/E) The market price of a 

company’s stock compared with earnings over the past year. 

A mutual fund’s P/E is the weighted average of the P/E of 

all stocks in the fund’s portfolio. 

primary market The market that deals with the issuance of 

new securities. 

S&P 500 Index A market capitalization index that is 

designed to measure the performance of 500 leading 

publicly held companies in leading industries of the U.S. 

economy. 

sampling If a fund uses a sampling method, the fund will 

not fully replicate the benchmark index and may hold 

89

securities not included in the index. A fund that utilizes a 

sampling approach may not track the return of the index. 

secondary market The market in which investors purchase 

securities from other investors rather than directly from the 

issuing companies. Organized exchanges facilitate the 

trading of securities in the secondary market. 

spread The gap between bid and ask prices of a security. 

stock A share of ownership, or equity, in the issuing 

company. 

90 

total return The percentage that an investor would have 

earned or lost on an investment in the fund assuming 

dividends and distributions were reinvested. 

tracking error The difference between the performance of 

the fund and its benchmark index, positive or negative.

PRIVACY NOTICE 

THIS IS NOT PART OF THE SHAREHOLDER REPORT 

A Commitment to Your Privacy 

Your Privacy Is Not for Sale 

We do not and will not sell your personal information to 

anyone, for any reason. 

We are committed to protecting the privacy of information 

we maintain about you. Below are details about our 

commitment, including the types of information we collect 

and how we use and share that information. This Privacy 

Notice applies to you only if you are an individual who 

invests directly in the funds by placing orders through the 

funds’ transfer agent. If you place orders through your 

brokerage account at Charles Schwab & Co., Inc. or an 

account with another broker-dealer, investment advisor, 

401(k) plan, employee benefit plan, administrator, bank or 

other financial intermediary, you are covered by the 

privacy policies of that financial institution and should 

consult those policies. 

How We Collect Information About You 

We collect personal information about you in a number of 

ways. 

k APPLICATION AND REGISTRATION 

INFORMATION. 

We collect personal information from you when you open 

an account or utilize one of our services. We may also 

collect information about you from third parties such as 

consumer reporting agencies to verify your identity. The 

information we collect may include personal information, 

including your Social Security number, as well as details 

about your interests, investments and investment 

experience. 

k TRANSACTION AND EXPERIENCE INFORMATION. 

Once your account has been opened, we collect and 

maintain personal information about your account 

activity, including your transactions, balances, positions 

and history. This information allows us to administer your 

account and provide the services you have requested. 

k WEBSITE USAGE. 

When you visit our websites, we may use devices known as 

“cookies,” graphic interchange format files (GIFs), or other 

similar web tools to enhance your web experience. These 

tools help us to recognize you, maintain your web session, 

and provide a more personalized experience. To learn 

more, please click the Privacy link on our website. 

How We Share and Use Your Information 

We provide access to information about you to our affiliated 

companies, outside companies and other third parties 

in certain limited circumstances, including: 

k to help us process transactions for your account; 

k when we use other companies to provide services for us, 

such as printing and mailing your account statements; 

k when we believe that disclosure is required or permitted 

under law (for example, to cooperate with regulators or 

law enforcement, resolve consumer disputes, perform 

credit/authentication checks, or for risk control). 

State Laws 

We will comply with state laws that apply to the disclosure 

or use of information about you. 

Safeguarding Your Information — Security Is a Partnership 

We take precautions to ensure the information we collect 

about you is protected and is accessed only by authorized 

individuals or organizations. 

Companies we use to provide support services are not 

allowed to use information about our shareholders for 

their own purposes and are contractually obligated to 

maintain strict confidentiality. We limit their use of information 

to the performance of the specific services we have 

requested. 

We restrict access to personal information by our 

employees and agents. Our employees are trained about 

privacy and are required to safeguard personal 

information. 

We maintain physical, electronic and procedural safeguards 

that comply with federal standards to guard your 

nonpublic personal information. 

Contact Us 

To provide us with updated information, report suspected 

fraud or identity theft, or for any other questions, please 

call the number below. 

Schwab ETF TM direct investors: 1-800-435-4000 

· 2012 Schwab ETFs. All rights reserved. 

91

Notes

Schwab ETFs TM are designed to be low-cost, diversified 

investments. Each fund follows broad market indices and 

provides exposure to specific segments of the market, 

making each a solid investment option for the core 

portions of an investor portfolio. The list to the right 

shows all currently available Schwab ETFs. 

Investors should carefully consider information contained 

in the prospectus, including investment objectives, risks, 

charges and expenses before investing. Please call 

1-800-435-4000 for a prospectus and brochure for any 

Schwab ETF. Please read the prospectus carefully before 

you invest. This report must be preceded or accompanied 

by a current prospectus. 

Proxy Voting Policies, Procedures and Results 

A description of the proxy voting policies and 

procedures used to determine how to vote proxies 

on behalf of the funds is available without charge, 

upon request, by visiting the Schwab ETFs’ website 

at www.schwabetfs.com, the SEC’s website at 

http://www.sec.gov, or by contacting Schwab ETFs 

at 1-800-435-4000. 

Information regarding how a fund voted proxies 

relating to portfolio securities during the most recent 

twelve-month period ended June 30 is available, 

without charge, by visiting the fund’s website at 

www.schwabetfs.com or the SEC’s website at 

http://www.sec.gov. 

Schwab ETFs 

U.S. ETFs 

Schwab U.S. Broad Market ETF TM 

Schwab U.S. Large-Cap ETF TM 

Schwab U.S. Large-Cap Growth ETF TM 

Schwab U.S. Large-Cap Value ETF TM 

Schwab U.S. Mid-Cap ETF TM 

Schwab U.S. Small-Cap ETF TM 

Schwab U.S. Dividend Equity ETF TM 

Schwab U.S. REIT ETF TM 

International ETFs 




Fixed Income ETFs 

Schwab U.S. Aggregate Bond ETF TM 

Schwab Short-Term U.S. Treasury ETF TM 

Schwab Intermediate-Term U.S. Treasury ETF TM 

Schwab U.S. TIPS ETF TM

Investment Adviser 

Charles Schwab Investment Management, Inc. 

211 Main Street, San Francisco, CA 94105 

Schwab ETFs TM 

1-800-435-4000 

This report is not authorized for distribution to prospective investors 

unless preceded or accompanied by a current prospectus. 

� 2012 Charles Schwab Investment Management, Inc. All rights reserved. 

Printed on recycled paper. 

MFR57933-02 

00088951

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