Washington, D.C. 20549
FORM N-CSR/S
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number: 811-7852
Exact name of registrant as specified in charter: USAA MUTUAL FUNDS TRUST
Address of principal executive offices and zip code: 9800 FREDERICKSBURG ROAD
SAN ANTONIO, TX 78288
Name and address of agent for service: CHRISTOPHER P. LAIA
USAA MUTUAL FUNDS TRUST
9800 FREDERICKSBURG ROAD
SAN ANTONIO, TX 78288
Registrant's telephone number, including area code: (210) 498-0226
Date of fiscal year end: MAY 31,
Date of reporting period: NOVEMBER 30, 2009
ITEM 1. SEMIANNUAL REPORT TO STOCKHOLDERS.
USAA GNMA TRUST - SEMIANNUAL REPORT FOR PERIOD ENDED NOVEMBER 30, 2009
[LOGO OF USAA]
USAA(R)
[GRAPHIC OF USAA GNMA TRUST]
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SEMIANNUAL REPORT
USAA GNMA TRUST(R)
NOVEMBER 30, 2009
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FUND OBJECTIVE
HIGH LEVEL OF CURRENT INCOME CONSISTENT WITH PRESERVATION OF PRINCIPAL.
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TYPES OF INVESTMENTS
Normally invests at least 80% of the Fund's assets in GNMA securities backed by
the full faith and credit of the U.S. government.
IRA DISTRIBUTION WITHHOLDING DISCLOSURE
We generally must withhold federal income tax at a rate of 10% of the taxable
portion of your distribution and, if you live in a state that requires state
income tax withholding, at your state's set rate. However, you may elect not to
have withholding apply or to have income tax withheld at a higher rate. If you
wish to make such an election, please call USAA Investment Management Company at
(800) 531-USAA (8722).
If you must pay estimated taxes, you may be subject to estimated tax penalties
if your estimated tax payments are not sufficient and sufficient tax is not
withheld from your distribution.
For more specific information, please consult your tax adviser.
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TABLE OF CONTENTS
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PRESIDENT'S MESSAGE 2
MANAGER'S COMMENTARY 4
FUND RECOGNITION 9
INVESTMENT OVERVIEW 11
FINANCIAL INFORMATION
Portfolio of Investments 16
Notes to Portfolio of Investments 20
Financial Statements 22
Notes to Financial Statements 25
EXPENSE EXAMPLE 35
THIS REPORT IS FOR THE INFORMATION OF THE SHAREHOLDERS AND OTHERS WHO HAVE
RECEIVED A COPY OF THE CURRENTLY EFFECTIVE PROSPECTUS OF THE FUND, MANAGED BY
USAA INVESTMENT MANAGEMENT COMPANY. IT MAY BE USED AS SALES LITERATURE ONLY WHEN
PRECEDED OR ACCOMPANIED BY A CURRENT PROSPECTUS, WHICH PROVIDES FURTHER DETAILS
ABOUT THE FUND.
(C)2010, USAA. All rights reserved.
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PRESIDENT'S MESSAGE
"IN MY OPINION, THOSE WHO WERE DIVERSIFIED
WEATHERED THE STORM BETTER THAN THOSE WHO [PHOTO OF DANIEL S. McNAMARA]
WERE AGGRESSIVELY POSITIONED."
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DECEMBER 2009
As we head into 2010, I wish you a healthy and prosperous new year. I am honored
to be the new president of the USAA Investment Management Company, an
organization with a rich history of service and accomplishment.
At the time of this writing, the financial markets appear to be back on track --
an excellent time, in my opinion, to take stock of the past year. At the
beginning of 2009, stocks seemed priced for extinction. In the fixed income
market, credit spreads (or, the difference in bond yields) had widened to record
levels as investors fled to the safety of U.S. Treasury securities. The U.S.
economy was in a deep recession. Home prices continued to fall and unemployment
steadily increased, leading to a sharp decline in consumer spending.
In March 2009, however, world stock prices reversed course. For example, the S&P
500 Index rose 64% between the market bottom on March 6, 2009, and November 30,
2009. The fixed income market experienced record price appreciation, and the
prices of oil and other commodities such as gold and precious metals increased.
The dollar weakened, making U.S. goods and services less expensive to buyers
around the world. Meanwhile, the federal government's fiscal stimulus spending,
including its "cash for clunkers" program, seemed to help stabilize the economy.
In the third quarter, the U.S. gross domestic product grew at 2.2%.
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2 | USAA GNMA TRUST
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I believe the worst of the crisis appears to be over. Nevertheless, risk
remains. And no one knows exactly what will happen next. This makes it an
opportune time for all of us to take stock of our investment portfolios.
Looking back at the market decline, many investors were not appropriately
positioned relative to their risk tolerance. In my opinion, those who were
diversified weathered the storm better than those who were aggressively
positioned.
With this in mind, I have undertaken a review of my own investment portfolio.
Like a medical exam helps me to take care of my physical health, a portfolio
checkup helps me to monitor my financial health. The process gives me the
opportunity to reflect on my goals, re-evaluate my risk tolerance, consider
changes in my investment strategy, and reposition my portfolio accordingly. I
urge you to do the same. Our trained service representatives are standing ready
to assist you -- free of charge.
At USAA Investment Management Company, we stand ready to help you with your
investment needs. We continue to offer what we consider an excellent value --
some of the industry's top investment talent, first-class service, and no-load
mutual funds. On behalf of all us, thank you for your business and the trust you
have placed in us.
Sincerely,
/S/ DANIEL S. MCNAMARA
Daniel S. McNamara
President
USAA Investment Management Company
Diversification does not guarantee a profit or prevent a loss. o Mutual fund
operating expenses apply and continue throughout the life of the Fund. o Past
performance is no guarantee of future results.
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PRESIDENT'S MESSAGE | 3
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MANAGER'S COMMENTARY ON THE FUND
MARGARET "DIDI" WEINBLATT, Ph.D., CFA [PHOTO OF MARGARET "DIDI" WEINBLATT]
USAA Investment Management Company
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o HOW DID THE USAA GNMA TRUST (THE FUND) PERFORM?
For the six-month period ended November 30, 2009, the Fund had a total return
of 3.91%. This compares to returns of 5.39% for the Lipper GNMA Funds Index,
4.37% for the Barclays Capital GNMA Index, and 5.30% for the Lipper GNMA
Funds Average.
o WHAT LED TO THE FUND'S RELATIVE UNDERPERFORMANCE?
We manage the Fund in what we believe to be a conservative yet opportunistic
way. By opportunistic, we like to buy when prevailing rates are higher and
sell when rates are lower--bond prices and yields move in opposite
directions. This has proven to be a solid strategy over time.
During the financial crisis, the Federal Reserve Board (the Fed) instituted a
number of programs to support the credit markets. One involved quantitative
easing, or the Fed's buying of government securities (including GNMAs) for
its own balance sheets to keep rates, specifically mortgage interest rates,
low. The program, which was set to expire at the end of 2009, involved buying
$1.25 trillion in government agency mortgage-backed securities (MBS), $200
billion
Refer to page 14 for benchmark definitions.
Past performance is no guarantee of future results.
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4 | USAA GNMA TRUST
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o HISTORICAL YIELD CURVES FOR TREASURIES o
[CHART OF HISTORICAL YIELDS CURVE FOR TREASURIES]
6/01/09 11/30/09 CHANGE
------- -------- --------
3 MONTH 0.091% 0.047% -0.0446%
6 MONTH 0.277 0.147 -0.1301
1 YEAR 0.440 0.242 -0.1986
2 YEAR 0.946 0.663 -0.2831
3 YEAR 1.467 1.100 -0.3670
5 YEAR 2.521 2.000 -0.5217
7 YEAR 3.258 2.686 -0.5716
10 YEAR 3.673 3.198 -0.4748
30 YEAR 4.534 4.192 -0.3420
[END CHART]
Source: Bloomberg L.P.
of other U.S. government agency bonds, and $300 billion in U.S. Treasury
securities.
Our view was that, with the government planning to shut down these programs
at the end of the year, interest rates would rise, giving us a much better
(and cheaper) entry point. Therefore, we slowly built up cash, on which we
were earning very little yield. This left us vulnerable when the Fed
announced that it was extending the program through March 2010. We are
disappointed in the short-term performance, but continue prudently to
position the portfolio for the ultimate removal
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MANAGER'S COMMENTARY ON THE FUND | 5
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of government stimulus. Our attempts to protect shareholders from rising
interest rates, which would cause bond prices to fall, is a priority.
o IS THE CREDIT CRISIS OVER?
With the help of coordinated global intervention, risk premiums in the bond
market have returned to early 2008 levels, before the collapse of Bear
Stearns, which was one of the earliest signs of the coming financial crisis.
Investors' re-embrace of risk has led to massive out-performance by riskier
asset classes within the bond market, including commercial MBS, asset-backed
securities and corporate bonds. So while safe U.S. government agency MBS had
positive absolute performance, they significantly underperformed these more
risky sectors.
o HOW DID YOU ADJUST THE PORTFOLIO AS THE PERIOD PROGRESSED?
We continue to believe that interest rates will rise, especially on MBS, when
the Fed stops purchasing virtually all of the new issuance. With rates so
low, today's new mortgages will probably have little chance of refinancing.
Housing turnover should remain low. Thus, most pre-payments we expect will
likely be caused by defaults of homeowners. When this happens with government
agency MBS, investors get their principal back and are forced to invest at
then-current interest rates. If pre-payments slow, the average life of a
mortgage becomes longer and more sensitive to higher interest rates.
Therefore, where we did purchase GNMAs, we kept our purchases to higher
coupon bonds and 15-year GNMAs, both of which have less interest rate and
extension risk. Additionally, we think that homeowners who choose 15-year
mortgages tend to be higher-quality borrowers.
Shares of the USAA GNMA Trust are not individually backed by the full faith
and credit of the U.S. government.
You will find a complete list of securities that the Fund owns on pages 16-19.
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6 | USAA GNMA TRUST
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COUPON RATE COMPOSITION
o OF MORTGAGE OBLIGATIONS IN USAA GNMA TRUST o
[CHART OF COUPON RATE COMPOSITION]
PERCENT OF
COUPON RATE % TOTAL MARKET VALUE
------------- ------------------
4.50 9
5.00 15
5.50 41
5.86 0*
6.00 28
6.50 5
6.75 0*
7.00 2
7.50 0*
8.00 0*
8.50 0*
9.00 0*
[END CHART]
*Represents less than 1%.
o WITH THE DISCONCERTING NEWS COMING OUT OF THE FEDERAL HOUSING ADMINISTRATION,
ARE YOU CONCERNED ABOUT ADDITIONAL DEFAULTS AND FORECLOSURES?
As a U.S. taxpayer, I'm quite concerned. FHA-issued mortgages, which along
with Veterans Administration mortgages are bundled into GNMAs, are backed by
the full faith and credit of the U.S. government. So I'm not worried about
getting the principal paid when there are defaults--it's taxpayers, not
bondholders, who are at risk.
To keep mortgage lending going during this long housing collapse, Congress
has pushed the FHA to issue more mortgages and has increased the limits on
how big these mortgages can be from $329,000 to $729,000 in more expensive
regional markets. Foreclosures on these loans have risen, and these cause
pre-payments. FHA gives
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MANAGER'S COMMENTARY ON THE FUND | 7
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loans with very low down payments, which in some cases can be fully covered
by the government's $8,000 first-time home buyers tax credit. With the larger
limits, FHA mortgages are more vulnerable than they've been in the past.
That's one reason why we're focusing on 15-year GNMAs and have built cash in
anticipation of higher rates when the government begins removing the stimulus.
o WHAT OTHER RISKS ARE YOU MANAGING AGAINST?
We're cognizant of additional legislative risk, in addition to the removal of
stimulus funds, the potential for higher rates, and extension risk. The many
programs the government has instituted to support the housing market may
change the characteristics of mortgages underlying the securities the Fund
owns. We continue to monitor these changes and their impact on the securities
we purchase.
o WHAT'S YOUR MESSAGE TO SHAREHOLDERS AS WE GO INTO 2010?
Throughout the financial crisis, the Fund has provided a positive return and
steady current income. While we are gratified that markets have improved
substantially, there remain a number of potential problem areas, specifically
with regard to how the economy and markets will respond to the removal of
government stimulus. We are managing against the potential risks to this Fund
while looking for opportunities to increase current yield and total return.
We thank you for your investment in the Fund and for the opportunity to serve
you.
While the value of the GNMA Trust's shares is not guaranteed by the U.S.
Government, the Trust endeavors to maintain low-to-moderate fluctuation of share
price.
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8 | USAA GNMA TRUST
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FUND RECOGNITION
USAA GNMA TRUST
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OVERALL MORNINGSTAR RATING(TM)
out of 345 intermediate government funds
for the period ended November 30, 2009:
OVERALL RATING
* * * *
3-YEAR
* * * *
out of 345 funds
5-YEAR
* * * *
out of 318 funds
10-YEAR
* * * *
out of 234 funds
The Overall Morningstar Rating for a fund is derived from a weighted average of
the performance figures associated with its three-, five-, and 10-year (if
applicable) Morningstar Rating metrics. Ratings are based on risk-adjusted
returns.
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PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. For each fund with at least
a three-year history, Morningstar calculates a Morningstar Rating(TM) based on a
Morningstar Risk-Adjusted Return measure that accounts for variation in a fund's
monthly performance (including the effects of sales charges, loads, and
redemption fees), placing more emphasis on downward variations and rewarding
consistent performance. The top 10% of the funds in each broad asset class
receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars,
the next 22.5% receive 2 stars, and the bottom 10% receive 1 star.
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FUND RECOGNITION | 9
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LIPPER LEADER (OVERALL)
[5]
PRESERVATION
The Fund is listed as a Lipper Leader for Preservation among 4,102 fixed-income
funds within the Lipper U.S. Mortgage category for the overall period ended
November 30, 2009. The Fund received a Lipper Leader rating for Preservation
among 4,102, 3,595 and 2,419 fixed-income funds for the three-, five-, and
10-year periods, respectively. Lipper ratings for Preservation reflect funds'
historical loss avoidance relative to other funds within the same asset class,
as of November 30, 2009. Preservation ratings are relative, rather than
absolute, measures, and funds named Lipper Leaders for Preservation may still
experience losses periodically; those losses may be larger for equity and mixed
equity funds than for fixed-income funds.
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Ratings are subject to change every month and are based on an equal-weighted
average of percentile ranks for the Preservation metric over three-, five-, and
10-year periods (if applicable). The highest 20% of funds in each peer group are
named Lipper Leaders, the next 20% receive a score of 4, the middle 20% are
scored 3, the next 20% are scored 2, and the lowest 20% are scored 1. Lipper
ratings are not intended to predict future results, and Lipper does not
guarantee the accuracy of this information. More information is available at
WWW.LIPPERLEADERS.COM. Lipper Leader Copyright 2010, Reuters, All Rights
Reserved.
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10 | USAA GNMA TRUST
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INVESTMENT OVERVIEW
USAA GNMA TRUST (Ticker Symbol: USGNX)
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11/30/09 5/31/09
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Net Assets $606.8 Million $564.3 Million
Net Asset Value Per Share $10.16 $9.97
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AVERAGE ANNUAL TOTAL RETURNS AS OF 11/30/09
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5/31/09 to 11/30/09* 1 Year 5 Years 10 Years
3.91% 8.31% 5.48% 5.99%
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30-DAY SEC YIELD** AS OF 11/30/09 EXPENSE RATIO***
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4.28% 0.55%
*Total returns for periods of less than one year are not annualized. This
six-month return is cumulative.
**Calculated as prescribed by the Securities and Exchange Commission.
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND IS NO GUARANTEE OF
FUTURE RESULTS. CURRENT PERFORMANCE MAY BE HIGHER OR LOWER THAN THE PERFORMANCE
DATA QUOTED. THE RETURN AND PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE, SO
THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST. FOR PERFORMANCE DATA CURRENT TO THE MOST RECENT MONTH-END, VISIT
USAA.COM.
***THE EXPENSE RATIO REPRESENTS THE TOTAL ANNUAL OPERATING EXPENSES INCLUDING
ANY ACQUIRED FUND FEES AND EXPENSES, BEFORE REDUCTIONS OF ANY EXPENSES PAID
INDIRECTLY, AS REPORTED IN THE FUND'S PROSPECTUS DATED OCTOBER 1, 2009, AND IS
CALCULATED AS A PERCENTAGE OF AVERAGE NET ASSETS. THIS EXPENSE RATIO MAY DIFFER
FROM THE EXPENSE RATIO DISCLOSED IN THE FINANCIAL HIGHLIGHTS.
Total return measures the price change in a share assuming the reinvestment of
all net investment income and realized capital gain distributions. The total
returns quoted do not reflect adjustments made to the enclosed financial
statements in accordance with U.S. generally accepted accounting principles or
the deduction of taxes that a shareholder would pay on fund distributions or the
redemption of fund shares.
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INVESTMENT OVERVIEW | 11
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AVERAGE ANNUAL COMPOUNDED RETURNS WITH REINVESTMENT OF DIVIDENDS -- PERIODS
ENDED NOVEMBER 30, 2009
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TOTAL RETURN = DIVIDEND RETURN + PRICE CHANGE
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10 Years 5.99% = 5.33% + 0.66%
5 Years 5.48% = 4.78% + 0.70%
1 Year 8.31% = 4.32% + 3.99%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND IS NO GUARANTEE OF
FUTURE RESULTS. CURRENT PERFORMANCE MAY BE HIGHER OR LOWER THAN THE PERFORMANCE
DATA QUOTED. THE RETURN AND PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE, SO
THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST. FOR PERFORMANCE DATA CURRENT TO THE MOST RECENT MONTH-END, VISIT
USAA.COM.
ANNUAL TOTAL RETURNS AND COMPOUNDED DIVIDEND RETURNS FOR THE 10-YEAR PERIOD
ENDED NOVEMBER 30, 2009
[CHART OF ANNUAL TOTAL RETURNS AND COMPOUNDED DIVIDEND RETURNS]
TOTAL RETURN DIVIDEND RETURN CHANGE IN SHARE PRICE
------------ --------------- ---------------------
11/30/2000 9.66% 7.35% 2.31%
11/30/2001 9.90% 6.61% 3.29%
11/30/2002 7.02% 5.73% 1.29%
11/30/2003 2.47% 5.02% -2.55%
11/30/2004 3.73% 4.84% -1.11%
11/30/2005 1.94% 4.90% -2.96%
11/30/2006 5.55% 5.02% 0.53%
11/30/2007 6.10% 4.95% 1.15%
11/30/2008 5.64% 4.71% 0.93%
11/30/2009 8.31% 4.32% 3.99%
[END CHART]
NOTE THE ROLE THAT DIVIDEND RETURNS PLAY IN THE FUND'S TOTAL RETURN OVER TIME.
WHILE SHARE PRICES TEND TO VARY, DIVIDEND RETURNS GENERALLY ARE A RELATIVELY
STABLE COMPONENT OF TOTAL RETURNS.
Total return equals dividend return plus share price change and assumes
reinvestment of all net investment income and realized capital gain
distributions. Dividend return is the net investment income dividends received
over the period, assuming reinvestment of all dividends. Share price change is
the change in net asset value over the period adjusted for realized capital gain
distributions. The total returns quoted do not reflect adjustments made to the
enclosed financial statements in accordance with U.S. generally accepted
accounting principles or the deduction of taxes that a shareholder would pay on
fund distributions or the redemption of fund shares.
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12 | USAA GNMA TRUST
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o 12-MONTH DIVIDEND YIELD COMPARISON o
[CHART OF 12-MONTH DIVIDEND YIELD COMPARISON]
USAA GNMA TRUST LIPPER GNMA FUNDS AVERAGE
11/30/2000 6.78% 6.12%
11/30/2001 6.15 5.62
11/30/2002 5.48 4.75
11/30/2003 5.14 4.04
11/30/2004 4.81 4.02
11/30/2005 5.02 4.12
11/30/2006 4.81 4.64
11/30/2007 4.66 4.64
11/30/2008 4.53 4.48
11/30/2009 4.01 4.01
[END CHART]
The 12-month dividend yield is computed by dividing net investment income
dividends paid during the previous 12 months by the latest adjusted month-end
net asset value. The net asset value is adjusted for a portion of the capital
gains distributed during the previous nine months. The graph represents data for
periods ending 11/30/00 to 11/30/09.
The Lipper GNMA Funds Average is an average performance level of all GNMA funds,
reported by Lipper Inc., an independent organization that monitors the
performance of mutual funds.
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INVESTMENT OVERVIEW | 13
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o CUMULATIVE PERFORMANCE COMPARISON o
[CHART OF CUMULATIVE PERFORMANCE COMPARISON]
BARCLAYS CAPITAL LIPPER GNMA FUNDS
GNMA INDEX USAA GNMA TRUST INDEX
11/30/99 $10,000.00 $10,000.00 $10,000.00
12/31/99 9,979.93 9,938.68 9,957.05
01/31/00 9,889.78 9,889.61 9,870.19
02/29/00 10,016.29 10,032.59 9,991.87
03/31/00 10,174.56 10,155.49 10,148.59
04/30/00 10,165.62 10,102.26 10,125.57
05/31/00 10,202.55 10,198.11 10,166.63
06/30/00 10,390.76 10,400.61 10,339.40
07/31/00 10,445.59 10,451.02 10,382.02
08/31/00 10,603.41 10,622.91 10,534.81
09/30/00 10,702.39 10,692.94 10,625.39
10/31/00 10,781.99 10,779.93 10,691.80
11/30/00 10,933.61 10,966.14 10,854.93
12/31/00 11,088.57 11,148.11 11,010.55
01/31/01 11,269.21 11,316.24 11,178.02
02/28/01 11,319.68 11,399.99 11,234.58
03/31/01 11,387.35 11,481.70 11,290.32
04/30/01 11,406.73 11,451.15 11,290.62
05/31/01 11,500.89 11,512.79 11,367.36
06/30/01 11,534.61 11,527.63 11,394.97
07/31/01 11,732.00 11,754.23 11,606.55
08/31/01 11,817.80 11,859.28 11,693.09
09/30/01 11,978.02 12,027.90 11,848.52
10/31/01 12,136.88 12,206.62 11,999.80
11/30/01 12,035.83 12,051.96 11,885.33
12/31/01 11,999.82 11,944.98 11,827.39
01/31/02 12,120.13 12,067.91 11,947.69
02/28/02 12,244.00 12,216.98 12,076.10
03/31/02 12,128.05 12,041.18 11,950.16
04/30/02 12,341.26 12,292.36 12,159.04
05/31/02 12,422.35 12,414.39 12,238.71
06/30/02 12,521.79 12,504.16 12,334.44
07/31/02 12,667.80 12,642.68 12,475.15
08/31/02 12,756.23 12,772.87 12,572.63
09/30/02 12,860.94 12,876.45 12,673.90
10/31/02 12,902.46 12,898.84 12,701.53
11/30/02 12,914.39 12,898.03 12,703.91
12/31/02 13,042.96 13,048.14 12,840.61
01/31/03 13,076.46 13,079.92 12,871.58
02/28/03 13,142.86 13,146.04 12,942.70
03/31/03 13,152.04 13,144.59 12,937.12
04/30/03 13,183.35 13,188.69 12,968.23
05/31/03 13,183.81 13,218.08 12,983.15
06/30/03 13,223.84 13,229.99 13,004.94
07/31/03 13,005.80 12,954.80 12,744.03
08/31/03 13,090.34 13,034.62 12,821.12
09/30/03 13,279.47 13,244.26 13,032.67
10/31/03 13,244.71 13,193.81 12,979.17
11/30/03 13,290.02 13,216.50 13,020.52
12/31/03 13,415.04 13,310.65 13,111.33
01/31/04 13,482.02 13,377.43 13,180.26
02/29/04 13,571.71 13,456.13 13,261.53
03/31/04 13,627.57 13,510.51 13,304.51
04/30/04 13,412.86 13,310.73 13,083.26
05/31/04 13,384.76 13,268.13 13,050.21
06/30/04 13,503.92 13,377.49 13,142.09
07/31/04 13,613.34 13,472.91 13,252.12
08/31/04 13,802.71 13,633.43 13,431.18
09/30/04 13,831.38 13,658.03 13,420.38
10/31/04 13,940.57 13,739.62 13,508.29
11/30/04 13,907.65 13,709.91 13,470.81
12/31/04 13,998.95 13,768.01 13,543.16
01/31/05 14,078.32 13,833.66 13,621.78
02/28/05 14,033.59 13,790.37 13,572.63
03/31/05 14,006.63 13,761.20 13,544.95
04/30/05 14,148.86 13,890.66 13,673.73
05/31/05 14,251.05 13,974.67 13,762.40
06/30/05 14,292.91 14,003.42 13,792.25
07/31/05 14,239.01 13,960.30 13,736.75
08/31/05 14,356.68 14,075.92 13,851.24
09/30/05 14,299.45 14,007.16 13,779.19
10/31/05 14,237.40 13,945.88 13,711.39
11/30/05 14,267.22 13,975.90 13,749.71
12/31/05 14,447.64 14,141.06 13,902.76
01/31/06 14,494.89 14,181.63 13,935.94
02/28/06 14,524.25 14,195.90 13,960.92
03/31/06 14,431.23 14,124.82 13,866.78
04/30/06 14,382.60 14,060.99 13,812.04
05/31/06 14,353.59 14,030.81 13,775.48
06/30/06 14,370.56 14,029.01 13,776.81
07/31/06 14,573.91 14,217.33 13,958.21
08/31/06 14,797.80 14,410.20 14,160.25
09/30/06 14,885.65 14,513.84 14,248.06
10/31/06 14,988.19 14,613.97 14,340.95
11/30/06 15,130.64 14,747.65 14,474.95
12/31/06 15,113.09 14,731.14 14,441.82
01/31/07 15,113.21 14,722.70 14,437.38
02/28/07 15,296.61 14,905.11 14,612.56
03/31/07 15,329.75 14,918.36 14,631.80
04/30/07 15,411.30 14,990.61 14,702.32
05/31/07 15,333.77 14,907.74 14,613.17
06/30/07 15,245.68 14,827.54 14,536.18
07/31/07 15,369.90 14,933.59 14,664.44
08/31/07 15,547.21 15,110.93 14,818.33
09/30/07 15,663.29 15,197.55 14,922.69
10/31/07 15,834.75 15,338.58 15,070.98
11/30/07 16,153.84 15,646.71 15,353.78
12/31/07 16,167.48 15,658.02 15,365.32
01/31/08 16,443.21 15,929.01 15,611.87
02/29/08 16,516.73 16,010.70 15,691.54
03/31/08 16,568.46 16,067.94 15,715.17
04/30/08 16,558.94 16,046.85 15,693.56
05/31/08 16,464.08 15,944.93 15,605.19
06/30/08 16,464.66 15,953.97 15,612.87
07/31/08 16,464.66 15,948.47 15,617.73
08/31/08 16,669.27 16,094.79 15,734.56
09/30/08 16,749.90 16,198.97 15,734.33
10/31/08 16,527.63 15,995.40 15,437.00
11/30/08 17,120.71 16,525.01 15,832.44
12/31/08 17,440.48 16,791.55 16,167.90
01/31/09 17,427.06 16,800.83 16,218.29
02/28/09 17,532.24 16,912.48 16,350.28
03/31/09 17,810.14 17,160.62 16,663.50
04/30/09 17,855.10 17,185.29 16,763.43
05/31/09 17,883.66 17,225.63 16,849.13
06/30/09 17,865.65 17,231.95 16,898.54
07/31/09 18,060.29 17,396.88 17,133.11
08/31/09 18,175.90 17,518.16 17,269.30
09/30/09 18,311.82 17,608.70 17,402.39
10/31/09 18,425.94 17,717.10 17,543.93
11/30/09 18,665.42 17,898.76 17,757.40
[END CHART]
Data from 11/30/99 to 11/30/09.
The graph illustrates the comparison of a $10,000 hypothetical investment in the
USAA GNMA Trust to the following benchmarks:
o The unmanaged Barclays Capital GNMA Index covers the mortgage-backed
pass-through securities of the Government National Mortgage Association
(GNMA).
o The unmanaged Lipper GNMA Funds Index tracks the total return performance of
the 10 largest funds within the Lipper GNMA Funds category.
Past performance is no guarantee of future results, and the cumulative
performance quoted does not reflect the deduction of taxes that a shareholder
would pay on fund distributions or the redemption of fund shares.
================================================================================
14 | USAA GNMA TRUST
<PAGE>
================================================================================
o ASSET ALLOCATION -- 11/30/2009 o
[PIE CHART OF ASSET ALLOCATION]
30-YEAR FIXED-RATE SINGLE-FAMILY MORTGAGES* 72.0%
MONEY MARKET INSTRUMENTS 10.5%
15-YEAR FIXED-RATE SINGLE-FAMILY MORTGAGES* 10.2%
OTHER U.S. GOVERNMENT GUARANTEED SECURITIES 4.8%
COLLATERALIZED MORTGAGE OBLIGATIONS 2.1%
[END CHART]
* Combined in the portfolio of investments under mortgage-backed pass-through
securities, single-family.
Percentages are of the net assets of the Fund and may not equal 100%.
You will find a complete list of securities that the Fund owns on pages 16-19.
================================================================================
INVESTMENT OVERVIEW | 15
<PAGE>
================================================================================
PORTFOLIO OF INVESTMENTS
November 30, 2009 (unaudited)
---------------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT COUPON VALUE
(000) SECURITY RATE MATURITY (000)
---------------------------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY ISSUES (89.1%)(A)
MORTGAGE-BACKED PASS-THROUGH SECURITIES, SINGLE-FAMILY (82.2%)
$ 6,159 Government National Mortgage Assn. I 4.50% 5/15/2024 $ 6,524
8,536 Government National Mortgage Assn. I 4.50 9/15/2024 9,042
6,769 Government National Mortgage Assn. I 4.50 10/15/2024 7,170
6,473 Government National Mortgage Assn. I 4.50 10/15/2024 6,857
7,515 Government National Mortgage Assn. I 5.00 2/15/2039 7,918
3,012 Government National Mortgage Assn. I 5.50 12/15/2018 3,256
17,372 Government National Mortgage Assn. I 5.50 10/15/2033 18,636
6,809 Government National Mortgage Assn. I 5.50 12/15/2033 7,305
3,600 Government National Mortgage Assn. I 5.50 7/15/2034 3,858
14,274 Government National Mortgage Assn. I 5.50 10/15/2035 15,282
8,587 Government National Mortgage Assn. I 5.50 3/15/2038 9,158
10,180 Government National Mortgage Assn. I 5.50 4/15/2038 10,857
21,687 Government National Mortgage Assn. I 5.50 6/15/2039 23,130
2,745 Government National Mortgage Assn. I 6.00 12/15/2016 2,964
3,735 Government National Mortgage Assn. I 6.00 8/15/2022 4,032
1,816 Government National Mortgage Assn. I 6.00 4/15/2028 1,962
619 Government National Mortgage Assn. I 6.00 11/15/2028 670
1,478 Government National Mortgage Assn. I 6.00 2/15/2029 1,600
1,076 Government National Mortgage Assn. I 6.00 7/15/2029 1,164
1,404 Government National Mortgage Assn. I 6.00 5/15/2032 1,520
5,037 Government National Mortgage Assn. I 6.00 1/15/2033 5,446
1,389 Government National Mortgage Assn. I 6.00 2/15/2033 1,502
1,739 Government National Mortgage Assn. I 6.00 7/15/2033 1,881
1,084 Government National Mortgage Assn. I 6.00 9/15/2033 1,172
4,515 Government National Mortgage Assn. I 6.00 3/15/2037 4,843
8,062 Government National Mortgage Assn. I 6.00 9/15/2037 8,647
6,262 Government National Mortgage Assn. I 6.00 5/15/2038 6,712
11,200 Government National Mortgage Assn. I 6.00 5/15/2038 12,005
4,388 Government National Mortgage Assn. I 6.00 9/15/2038 4,703
8,825 Government National Mortgage Assn. I 6.00 10/15/2038 9,460
6,407 Government National Mortgage Assn. I 6.00 12/15/2038 6,867
421 Government National Mortgage Assn. I 6.50 5/15/2028 460
484 Government National Mortgage Assn. I 6.50 5/15/2028 529
425 Government National Mortgage Assn. I 6.50 7/15/2028 464
332 Government National Mortgage Assn. I 6.50 9/15/2028 363
================================================================================
16 | USAA GNMA TRUST
<PAGE>
================================================================================
---------------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT COUPON VALUE
(000) SECURITY RATE MATURITY (000)
---------------------------------------------------------------------------------------------------
$ 1,138 Government National Mortgage Assn. I 6.50% 11/15/2028 $ 1,243
50 Government National Mortgage Assn. I 6.50 1/15/2029 54
53 Government National Mortgage Assn. I 6.50 1/15/2029 58
940 Government National Mortgage Assn. I 6.50 3/15/2031 1,025
1,150 Government National Mortgage Assn. I 6.50 10/15/2031 1,253
755 Government National Mortgage Assn. I 6.50 1/15/2032 821
301 Government National Mortgage Assn. I 6.50 3/15/2032 327
1,011 Government National Mortgage Assn. I 6.50 8/15/2032 1,099
5,042 Government National Mortgage Assn. I 6.50 9/15/2032 5,501
73 Government National Mortgage Assn. I 6.75 5/15/2028 81
147 Government National Mortgage Assn. I 6.75 5/15/2028 163
77 Government National Mortgage Assn. I 7.00 4/15/2027 86
750 Government National Mortgage Assn. I 7.00 5/15/2027 836
61 Government National Mortgage Assn. I 7.00 6/15/2028 68
52 Government National Mortgage Assn. I 7.00 7/15/2028 58
203 Government National Mortgage Assn. I 7.00 8/15/2028 227
127 Government National Mortgage Assn. I 7.00 8/15/2028 142
203 Government National Mortgage Assn. I 7.00 9/15/2028 227
1,171 Government National Mortgage Assn. I 7.00 5/15/2029 1,307
1,035 Government National Mortgage Assn. I 7.00 6/15/2029 1,156
692 Government National Mortgage Assn. I 7.00 8/15/2031 773
310 Government National Mortgage Assn. I 7.00 9/15/2031 346
419 Government National Mortgage Assn. I 7.00 10/15/2031 469
193 Government National Mortgage Assn. I 7.00 6/15/2032 215
677 Government National Mortgage Assn. I 7.00 7/15/2032 752
307 Government National Mortgage Assn. I 7.50 2/15/2028 351
60 Government National Mortgage Assn. I 7.50 3/15/2029 69
155 Government National Mortgage Assn. I 7.50 4/15/2029 177
75 Government National Mortgage Assn. I 7.50 7/15/2029 86
159 Government National Mortgage Assn. I 7.50 10/15/2029 182
429 Government National Mortgage Assn. I 7.50 10/15/2029 492
64 Government National Mortgage Assn. I 7.50 12/15/2030 74
70 Government National Mortgage Assn. I 7.50 1/15/2031 80
70 Government National Mortgage Assn. I 7.50 1/15/2031 80
105 Government National Mortgage Assn. I 7.50 11/15/2031 121
15 Government National Mortgage Assn. I 8.00 1/15/2022 17
199 Government National Mortgage Assn. I 8.00 6/15/2023 229
279 Government National Mortgage Assn. I 8.00 5/15/2027 321
163 Government National Mortgage Assn. I 8.00 7/15/2030 188
87 Government National Mortgage Assn. I 8.00 9/15/2030 100
50 Government National Mortgage Assn. I 8.50 6/15/2021 58
11 Government National Mortgage Assn. I 8.50 7/15/2022 12
114 Government National Mortgage Assn. I 9.00 7/15/2021 131
================================================================================
PORTFOLIO OF INVESTMENTS | 17
<PAGE>
================================================================================
---------------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT COUPON VALUE
(000) SECURITY RATE MATURITY (000)
---------------------------------------------------------------------------------------------------
$14,296 Government National Mortgage Assn. II 4.50% 4/20/2024 $ 15,097
8,110 Government National Mortgage Assn. II 5.00 5/20/2033 8,585
9,189 Government National Mortgage Assn. II 5.00 7/20/2033 9,727
6,252 Government National Mortgage Assn. II 5.00 6/20/2034 6,615
18,640 Government National Mortgage Assn. II 5.00 9/20/2035 19,686
8,784 Government National Mortgage Assn. II 5.00 2/20/2037 9,258
1,965 Government National Mortgage Assn. II 5.50 4/20/2033 2,110
7,003 Government National Mortgage Assn. II 5.50 3/20/2034 7,511
26,543 Government National Mortgage Assn. II 5.50 2/20/2035 28,445
23,223 Government National Mortgage Assn. II 5.50 4/20/2035 24,887
13,245 Government National Mortgage Assn. II 5.50 7/20/2035 14,195
10,253 Government National Mortgage Assn. II 5.50 1/20/2037 10,966
1,009 Government National Mortgage Assn. II 6.00 3/20/2031 1,094
2,415 Government National Mortgage Assn. II 6.00 8/20/2032 2,617
1,964 Government National Mortgage Assn. II 6.00 9/20/2032 2,129
2,048 Government National Mortgage Assn. II 6.00 10/20/2033 2,219
2,005 Government National Mortgage Assn. II 6.00 12/20/2033 2,169
6,252 Government National Mortgage Assn. II 6.00 2/20/2034 6,755
5,914 Government National Mortgage Assn. II 6.00 3/20/2034 6,388
4,992 Government National Mortgage Assn. II 6.00 9/20/2034 5,397
12,041 Government National Mortgage Assn. II 6.00 10/20/2034 13,008
2,817 Government National Mortgage Assn. II 6.00 11/20/2034 3,039
7,258 Government National Mortgage Assn. II 6.00 5/20/2036 7,809
373 Government National Mortgage Assn. II 6.50 5/20/2031 407
302 Government National Mortgage Assn. II 6.50 7/20/2031 330
859 Government National Mortgage Assn. II 6.50 8/20/2031 940
1,315 Government National Mortgage Assn. II 6.50 4/20/2032 1,434
1,270 Government National Mortgage Assn. II 6.50 6/20/2032 1,383
4,503 Government National Mortgage Assn. II 6.50 8/20/2034 4,861
1,148 Government National Mortgage Assn. II 7.00 9/20/2030 1,278
151 Government National Mortgage Assn. II 7.50 4/20/2031 173
46 Government National Mortgage Assn. II 8.00 12/20/2022 53
1,084 Government National Mortgage Assn. II 8.00 8/20/2030 1,246
10,342 Fannie Mae(+) 5.00 12/01/2035 10,870
7,150 Fannie Mae(+) 5.50 11/01/2037 7,616
583 Fannie Mae(+) 6.00 2/01/2017 633
14,171 Fannie Mae(+) 6.00 5/01/2038 15,212
454 Fannie Mae(+) 6.50 10/01/2016 495
2,979 Fannie Mae(+) 6.50 12/01/2016 3,251
2,275 Freddie Mac(+) 5.00 1/01/2021 2,432
7,039 Freddie Mac(+) 5.50 12/01/2035 7,519
--------
498,853
--------
================================================================================
18 | USAA GNMA TRUST
<PAGE>
================================================================================
---------------------------------------------------------------------------------------------------
PRINCIPAL MARKET
AMOUNT COUPON VALUE
(000) SECURITY RATE MATURITY (000)
---------------------------------------------------------------------------------------------------
COLLATERALIZED MORTGAGE OBLIGATIONS (2.1%)
$12,175 Government National Mortgage Assn. I 5.50% 3/16/2032 $ 12,769
129 Government National Mortgage Assn. I 5.86 10/16/2023 130
--------
12,899
--------
OTHER U.S. GOVERNMENT GUARANTEED SECURITIES (4.8%)
5,000 Bank of America Corp., FDIC TLGP 0.49(b) 6/22/2012 5,032
5,000 JPMorgan Chase & Co., FDIC TLGP 0.53(b) 12/26/2012 5,046
5,000 JPMorgan Chase & Co., FDIC TLGP 0.67(b) 6/22/2012 5,055
4,000 MetLife, Inc., FDIC TLGP 0.60(b) 6/29/2012 4,039
5,000 State Street Corp., FDIC TLGP 0.50(b) 9/15/2011 5,022
5,000 Union Bank N.A., FDIC TLGP 0.50(b) 3/16/2012 5,027
--------
29,221
--------
Total U.S. Government Agency Issues (cost: $511,379) 540,973
--------
MONEY MARKET INSTRUMENTS (10.5%)
COMMERCIAL PAPER (0.5%)
3,000 Straight A Funding, LLC(a)(+),(c),(d) 0.12 12/15/2009 3,000
--------
REPURCHASE AGREEMENTS (10.0%)
60,611 Credit Suisse First Boston, LLC, 0.16%, acquired on
11/30/2009 and due on 12/01/2009 at $60,611
(collateralized by $58,514 of Government National
Mortgage Assn. I(a), 5.00%, due 10/15/2039;
market value $61,826) 60,611
--------
Total Money Market Instruments (cost: $63,611) 63,611
--------
TOTAL INVESTMENTS (COST: $574,990) $604,584
========
---------------------------------------------------------------------------------------------------
($ IN 000s) VALUATION HIERARCHY
---------------------------------------------------------------------------------------------------
(LEVEL 1) (LEVEL 2) (LEVEL 3)
QUOTED PRICES OTHER SIGNIFICANT SIGNIFICANT
IN ACTIVE MARKETS OBSERVABLE UNOBSERVABLE
FOR IDENTICAL ASSETS INPUTS INPUTS TOTAL
---------------------------------------------------------------------------------------------------
U.S. Government Agency
Issues $- $540,973 $- $540,973
Money Market Instruments:
Commercial Paper - 3,000 - 3,000
Repurchase Agreements - 60,611 - 60,611
---------------------------------------------------------------------------------------------------
Total $- $604,584 $- $604,584
---------------------------------------------------------------------------------------------------
================================================================================
PORTFOLIO OF INVESTMENTS | 19
<PAGE>
================================================================================
NOTES TO PORTFOLIO OF INVESTMENTS
November 30, 2009 (unaudited)
--------------------------------------------------------------------------------
o GENERAL NOTES
Market values of securities are determined by procedures and practices
discussed in Note 1 to the financial statements.
The portfolio of investments category percentages shown represent the
percentages of the investments to net assets, and, in total, may not equal
100%. A category percentage of 0.0% represents less than 0.1% of net assets.
o SPECIFIC NOTES
(a) U.S. government agency issues -- mortgage-backed securities issued by
Government National Mortgage Association (GNMA) and certain other U.S.
government guaranteed securities are supported by the full faith and
credit of the U.S. government. Securities issued by government-sponsored
enterprises, indicated with "+", are supported only by the right of the
government-sponsored enterprise to borrow from the U.S. Treasury, the
discretionary authority of the U.S. government to purchase the
government-sponsored enterprises' obligations, or by the credit of the
issuing agency, instrumentality, or corporation, and are neither issued
nor guaranteed by the U.S. Treasury.
(b) Variable-rate or floating-rate security -- interest rate is adjusted
periodically. The interest rate disclosed represents the current rate at
November 30, 2009.
(c) Restricted security that is not registered under the Securities Act of
1933. A resale of this security in the United States may
================================================================================
20 | USAA GNMA TRUST
<PAGE>
================================================================================
occur in an exempt transaction to a qualified institutional buyer as
defined by Rule 144A, and as such has been deemed liquid by USAA
Investment Management Company (the Manager) under liquidity guidelines
approved by the Board of Trustees, unless otherwise noted as illiquid.
(d) Commercial paper issued in reliance on the "private placement" exemption
from registration afforded by Section 4(2) of the Securities Act of 1933.
Unless this commercial paper is subsequently registered, a resale of this
commercial paper in the United States must be effected in a transaction
exempt from registration under the Securities Act of 1933. Section 4(2)
commercial paper is normally resold to other investors through or with
the assistance of the issuer or an investment dealer who makes a market
in this security, and as such has been deemed liquid by the Manager under
liquidity guidelines approved by the Board of Trustees, unless otherwise
noted as illiquid.
o PORTFOLIO ABBREVIATIONS AND DESCRIPTIONS
FDIC TLGP The FDIC Temporary Liquidity Guarantee Program provides a
guarantee of payment of principal and interest on certain newly
issued senior unsecured debt through the program's expiration
date on December 31, 2012. The guarantee carries the full faith
and credit of the U.S. government.
See accompanying notes to financial statements.
================================================================================
NOTES TO PORTFOLIO OF INVESTMENTS | 21
<PAGE>
================================================================================
STATEMENT OF ASSETS AND LIABILITIES
(IN THOUSANDS)
November 30, 2009 (unaudited)
--------------------------------------------------------------------------------
ASSETS
Investments in securities, at market value (cost of $574,990) $604,584
Receivables:
Capital shares sold 682
USAA Transfer Agency Company (Note 5C) 172
Interest 2,250
--------
Total assets 607,688
--------
LIABILITIES
Payables:
Capital shares redeemed 527
Dividends on capital shares 253
Accrued management fees 44
Other accrued expenses and payables 55
--------
Total liabilities 879
--------
Net assets applicable to capital shares outstanding $606,809
========
NET ASSETS CONSIST OF:
Paid-in capital $598,170
Accumulated undistributed net investment income 24
Accumulated net realized loss on investments (20,979)
Net unrealized appreciation of investments 29,594
--------
Net assets applicable to capital shares outstanding $606,809
========
Capital shares outstanding, unlimited number of shares
authorized, no par value 59,712
========
Net asset value, redemption price, and offering price per share $ 10.16
========
See accompanying notes to financial statements.
================================================================================
22 | USAA GNMA TRUST
<PAGE>
================================================================================
STATEMENT OF OPERATIONS
(IN THOUSANDS)
Six-month period ended November 30, 2009 (unaudited)
--------------------------------------------------------------------------------
INVESTMENT INCOME
Interest income $12,633
-------
EXPENSES
Management fees 311
Administration and servicing fees 436
Transfer agent's fees 348
Custody and accounting fees 52
Postage 20
Shareholder reporting fees 13
Trustees' fees 5
Registration fees 27
Professional fees 44
Other 10
-------
Total expenses 1,266
-------
NET INVESTMENT INCOME 11,367
-------
NET UNREALIZED GAIN ON INVESTMENTS
Change in net unrealized appreciation/depreciation 11,141
-------
Increase in net assets resulting from operations $22,508
=======
See accompanying notes to financial statements.
================================================================================
FINANCIAL STATEMENTS | 23
<PAGE>
================================================================================
STATEMENTS OF CHANGES IN NET ASSETS
(IN THOUSANDS)
Six-month period ended November 30, 2009 (unaudited), and year ended
May 31, 2009
--------------------------------------------------------------------------------
11/30/2009 5/31/2009
-----------------------------------------------------------------------------------------
FROM OPERATIONS
Net investment income $ 11,367 $ 23,456
Net realized gain on investments - 115
Change in net unrealized appreciation/depreciation of
investments 11,141 17,975
-----------------------
Increase in net assets resulting from operations 22,508 41,546
-----------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (11,343) (23,456)
-----------------------
FROM CAPITAL SHARE TRANSACTIONS
Proceeds from shares sold 97,654 201,308
Reinvested dividends 9,887 20,049
Cost of shares redeemed (76,150) (188,861)
-----------------------
Increase in net assets from capital
share transactions 31,391 32,496
-----------------------
Capital contribution from USAA Transfer Agency
Company - 2
-----------------------
Net increase in net assets 42,556 50,588
NET ASSETS
Beginning of period 564,253 513,665
-----------------------
End of period $606,809 $ 564,253
=======================
Accumulated undistributed net investment income:
End of period $ 24 $ -
=======================
CHANGE IN SHARES OUTSTANDING
Shares sold 9,749 20,513
Shares issued for dividends reinvested 984 2,052
Shares redeemed (7,607) (19,267)
-----------------------
Increase in shares outstanding 3,126 3,298
=======================
See accompanying notes to financial statements.
================================================================================
24 | USAA GNMA TRUST
<PAGE>
================================================================================
NOTES TO FINANCIAL STATEMENTS
November 30, 2009 (unaudited)
--------------------------------------------------------------------------------
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
USAA MUTUAL FUNDS TRUST (the Trust), registered under the Investment Company Act
of 1940 (the 1940 Act), as amended, is an open-end management investment company
organized as a Delaware statutory trust consisting of 46 separate funds. The
information presented in this semiannual report pertains only to the USAA GNMA
Trust (the Fund), which is classified as diversified under the 1940 Act. The
Fund's investment objective is to provide a high level of current income
consistent with preservation of principal.
A. SECURITY VALUATION -- The value of each security is determined (as of the
close of trading on the New York Stock Exchange (NYSE) on each business day
the NYSE is open) as set forth below:
1. Debt securities with maturities greater than 60 days are valued each
business day by a pricing service (the Service) approved by the Trust's
Board of Trustees. The Service uses an evaluated mean between quoted
bid and asked prices or the last sales price to price securities when,
in the Service's judgment, these prices are readily available and are
representative of the securities' market values. For many securities,
such prices are not readily available. The Service generally prices
these securities based on methods that include consideration of yields
or prices of securities of comparable quality, coupon, maturity, and
type; indications as to values from dealers in securities; and general
market conditions.
2. Debt securities purchased with original or remaining maturities of 60
days or less may be valued at amortized cost, which approximates market
value.
================================================================================
NOTES TO FINANCIAL STATEMENTS | 25
<PAGE>
================================================================================
3. Repurchase agreements are valued at cost, which approximates market
value.
4. Securities for which market quotations are not readily available or are
considered unreliable, or whose values have been materially affected by
events occurring after the close of their primary markets but before
the pricing of the Fund, are valued in good faith at fair value, using
methods determined by USAA Investment Management Company (the Manager),
an affiliate of the Fund, under valuation procedures approved by the
Trust's Board of Trustees. The effect of fair value pricing is that
securities may not be priced on the basis of quotations from the
primary market in which they are traded and the actual price realized
from the sale of a security may differ materially from the fair value
price. Valuing these securities at fair value is intended to cause the
Fund's net asset value (NAV) to be more reliable than it otherwise
would be.
Fair value methods used by the Manager include, but are not limited to,
obtaining market quotations from secondary pricing services,
broker-dealers, or widely used quotation systems. General factors
considered in determining the fair value of securities include
fundamental analytical data, the nature and duration of any
restrictions on disposition of the securities, and an evaluation of the
forces that influenced the market in which the securities are purchased
and sold.
B. FAIR VALUE MEASUREMENTS -- Fair value is defined as the price that would be
received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. The
three-level valuation hierarchy disclosed in the portfolio of investments
is based upon the transparency of inputs to the valuation of an asset or
liability as of the measurement date. The three levels are defined as
follows:
Level 1 -- inputs to the valuation methodology are quoted prices
(unadjusted) in active markets for identical securities.
================================================================================
26 | USAA GNMA TRUST
<PAGE>
================================================================================
Level 2 -- inputs to the valuation methodology are other significant
observable inputs, including quoted prices for similar securities, inputs
that are observable for the securities, either directly or indirectly, and
market-corroborated inputs such as market indices.
Level 3 -- inputs to the valuation methodology are unobservable and
significant to the fair value measurement, including the Manager's own
assumptions in determining the fair value.
The inputs or methodologies used for valuing securities are not necessarily
an indication of the risks associated with investing in those securities.
C. FEDERAL TAXES -- The Fund's policy is to comply with the requirements of
the Internal Revenue Code applicable to regulated investment companies and
to distribute substantially all of its income to its shareholders.
Therefore, no federal income tax provision is required.
D. INVESTMENTS IN SECURITIES -- Security transactions are accounted for on the
date the securities are purchased or sold (trade date). Gains or losses
from sales of investment securities are computed on the identified cost
basis. Interest income is recorded daily on the accrual basis. Premiums and
discounts are amortized over the life of the respective securities, using
the effective yield method for long-term securities and the straight-line
method for short-term securities.
E. REPURCHASE AGREEMENTS -- The Fund may enter into repurchase agreements with
commercial banks or recognized security dealers. These agreements are
collateralized by underlying securities. The collateral obligations are
marked-to-market daily to ensure their value is equal to or in excess of
the repurchase agreement price plus accrued interest and are held by the
Fund, either through its regular custodian or through a special "tri-party"
custodian that maintains separate accounts for both the Fund and its
counterparty, until maturity of the repurchase agreement. Repurchase
agreements are subject to credit risk, and the Fund's Manager monitors the
creditworthiness of sellers with which the Fund may enter into repurchase
agreements.
================================================================================
NOTES TO FINANCIAL STATEMENTS | 27
<PAGE>
================================================================================
F. SECURITIES PURCHASED ON A DELAYED-DELIVERY OR WHEN-ISSUED BASIS -- Delivery
and payment for securities that have been purchased by the Fund on a
delayed-delivery or when-issued basis can take place a month or more after
the trade date. During the period prior to settlement, these securities do
not earn interest, are subject to market fluctuation, and may increase or
decrease in value prior to their delivery. The Fund maintains segregated
assets with a market value equal to or greater than the amount of its
purchase commitments. The purchase of securities on a delayed-delivery or
when-issued basis may increase the volatility of the Fund's NAV to the
extent that the Fund makes such purchases while remaining substantially
fully invested.
G. EXPENSES PAID INDIRECTLY -- Through arrangements with the Fund's custodian
and other banks utilized by the Fund for cash management purposes, realized
credits, if any, generated from cash balances in the Fund's bank accounts
may be used to directly reduce the Fund's expenses. For the six-month
period ended November 30, 2009, these custodian and other bank credits
reduced the Fund's expenses by less than $500.
H. INDEMNIFICATIONS -- Under the Trust's organizational documents, its
officers and trustees are indemnified against certain liabilities arising
out of the performance of their duties to the Trust. In addition, in the
normal course of business the Trust enters into contracts that contain a
variety of representations and warranties that provide general
indemnifications. The Trust's maximum exposure under these arrangements is
unknown, as this would involve future claims that may be made against the
Trust that have not yet occurred. However, the Trust expects the risk of
loss to be remote.
I. USE OF ESTIMATES -- The preparation of financial statements in conformity
with U.S. generally accepted accounting principles requires management to
make estimates and assumptions that may affect the reported amounts in the
financial statements.
================================================================================
28 | USAA GNMA TRUST
<PAGE>
================================================================================
(2) LINE OF CREDIT
The Fund participates in a joint, short-term, revolving, committed loan
agreement of $750 million with USAA Capital Corporation (CAPCO), an affiliate of
the Manager. The purpose of the agreement is to meet temporary or emergency cash
needs, including redemption requests that might otherwise require the untimely
disposition of securities. Subject to availability, the Fund may borrow from
CAPCO an amount up to 5% of the Fund's total assets at a rate per annum equal to
the rate at which CAPCO obtains funding in the capital markets, with no markup.
The USAA funds that are party to the loan agreement are assessed facility fees
by CAPCO based on the funds' assessed proportionate share of CAPCO's operating
expenses related to obtaining and maintaining CAPCO's funding programs in total
(in no event to exceed 0.13% annually of the amount of the committed loan
agreement). Prior to September 25, 2009, the maximum annual facility fee was
0.07% of the amount of the committed loan agreement. The facility fees are
allocated among the funds based on their respective average net assets for the
period.
For the six-month period ended November 30, 2009, the Fund paid CAPCO facility
fees of $2,000, which represents 1.5% of the total fees paid to CAPCO by the
USAA funds. The Fund had no borrowings under this agreement during the six-month
period ended November 30, 2009.
(3) DISTRIBUTIONS
The tax basis of distributions and accumulated undistributed net investment
income will be determined based upon the Fund's tax year-end of May 31, 2010, in
accordance with applicable tax law.
Net investment income is accrued daily as dividends and distributed to
shareholders monthly. Distributions of realized gains from security transactions
not offset by capital losses are made annually in the succeeding fiscal year or
as otherwise required to avoid the payment of federal taxes. At May 31, 2009,
the Fund had capital loss carryovers of $20,978,000, for federal income tax
purposes, which, if not offset by subsequent capital gains, will expire between
2010 and 2015, as shown
================================================================================
NOTES TO FINANCIAL STATEMENTS | 29
<PAGE>
================================================================================
below. It is unlikely that the Trust's Board of Trustees will authorize a
distribution of capital gains realized in the future until the capital loss
carryovers have been used or expire.
CAPITAL LOSS CARRYOVERS
-----------------------------------------
EXPIRES BALANCE
----------- -----------
2010 $ 1,176,000
2012 9,577,000
2013 4,814,000
2014 3,887,000
2015 1,524,000
-----------
Total $20,978,000
===========
The Fund is required to evaluate tax positions taken or expected to be taken in
the course of preparing the Fund's tax returns to determine whether the tax
positions are "more-likely-than-not" of being sustained by the applicable tax
authority. Income tax and related interest and penalties would be recognized by
the Fund as tax expense in the statement of operations if the tax positions were
deemed to not meet the more-likely-than-not threshold. For the six-month period
ended November 30, 2009, the Fund did not incur any income tax, interest, or
penalties. As of November 30, 2009, the Manager has reviewed all open tax years
and concluded that there was no impact to the Fund's net assets or results of
operations. Tax years ended May 31, 2006, through May 31, 2009, remain subject
to examination by the Internal Revenue Service and state taxing authorities. On
an ongoing basis, the Manager will monitor its tax positions to determine if
adjustments to this conclusion are necessary.
(4) INVESTMENT TRANSACTIONS
Cost of purchases and proceeds from sales/maturities of securities, excluding
short-term securities, for the six-month period ended November 30, 2009, were
$64,289,000 and $74,163,000, respectively.
As of November 30, 2009, the cost of securities, including short-term
securities, for federal income tax purposes, was approximately the same as that
reported in the financial statements.
================================================================================
30 | USAA GNMA TRUST
<PAGE>
================================================================================
Gross unrealized appreciation and depreciation of investments as of November 30,
2009, were $29,594,000 and $0, respectively, resulting in net unrealized
appreciation of $29,594,000.
(5) TRANSACTIONS WITH MANAGER
A. MANAGEMENT FEES -- The Manager carries out the Fund's investment policies
and manages the Fund's portfolio pursuant to an Advisory Agreement. The
investment management fee for the Fund is composed of a base fee and a
performance adjustment. The Fund's base fee is accrued daily and paid
monthly at an annualized rate of 0.125% of its average net assets for the
fiscal year.
The performance adjustment is calculated monthly by comparing the Fund's
performance to that of the Lipper GNMA Funds Index over the performance
period. The Lipper GNMA Funds Index tracks the total return performance of
the 10 largest funds in the Lipper GNMA Funds category. The performance
period for the Fund consists of the current month plus the previous 35
months. The following table is utilized to determine the extent of the
performance adjustment:
OVER/UNDER PERFORMANCE ANNUAL ADJUSTMENT RATE
RELATIVE TO INDEX(1) AS A % OF THE FUND'S AVERAGE NET ASSETS(1)
----------------------------------------------------------------------------
+/- 0.20% to 0.50% +/- 0.04%
+/- 0.51% to 1.00% +/- 0.05%
+/- 1.01% and greater +/- 0.06%
(1)Based on the difference between average annual performance of the Fund
and its relevant index, rounded to the nearest 0.01%. Average net assets
are calculated over a rolling 36-month period.
The annual performance adjustment rate is multiplied by the average net
assets of the Fund over the entire performance period, which is then
multiplied by a fraction, the numerator of which is the number of days in
the month and the denominator of which is 365 (366 in leap years). The
resulting amount is the performance adjustment; a positive adjustment in
the case of overperformance, or a negative adjustment in the case of
underperformance.
================================================================================
NOTES TO FINANCIAL STATEMENTS | 31
<PAGE>
================================================================================
Under the performance fee arrangement, the Fund will pay a positive
performance fee adjustment for a performance period whenever the Fund
outperforms the Lipper GNMA Funds Index over that period, even if the Fund
had overall negative returns during the performance period.
For the six-month period ended November 30, 2009, the Fund incurred total
management fees, paid or payable to the Manager, of $311,000, which
included a (0.02)% performance adjustment of $(53,000).
B. ADMINISTRATION AND SERVICING FEES -- The Manager provides certain
administration and shareholder servicing functions for the Fund. For such
services, the Manager receives a fee accrued daily and paid monthly at an
annualized rate of 0.15% of the Fund's average net assets. For the
six-month period ended November 30, 2009, the Fund incurred administration
and servicing fees, paid or payable to the Manager, of $436,000.
In addition to the services provided under its Administration and Servicing
Agreement with the Fund, the Manager also provides certain compliance and
legal services for the benefit of the Fund. The Trust's Board of Trustees
has approved the reimbursement of a portion of these expenses incurred by
the Manager. For the six-month period ended November 30, 2009, the Fund
reimbursed the Manager $15,000 for these compliance and legal services.
These expenses are included in the professional fees on the Fund's
statement of operations.
C. TRANSFER AGENT'S FEES -- USAA Transfer Agency Company, d/b/a USAA
Shareholder Account Services (SAS), an affiliate of the Manager, provides
transfer agent services to the Fund based on an annual charge of $25.50 per
shareholder account plus out-of-pocket expenses. The Fund also pays SAS
fees that are related to the administration and servicing of accounts that
are traded on an omnibus basis. For the six-month period ended November 30,
2009, the Fund incurred transfer agent's fees, paid or payable to SAS, of
$348,000. The Fund
================================================================================
32 | USAA GNMA TRUST
<PAGE>
================================================================================
recorded a receivable from SAS of $172,000 at November 30, 2009, for
adjustments related to corrections in fees paid for the administration and
servicing of certain accounts.
D. UNDERWRITING SERVICES -- The Manager provides exclusive underwriting and
distribution of the Fund's shares on a continuing best-efforts basis. The
Manager receives no commissions or fees for this service.
(6) TRANSACTIONS WITH AFFILIATES
Certain trustees and officers of the Fund are also directors, officers, and/or
employees of the Manager. None of the affiliated trustees or Fund officers
received any compensation from the Fund.
(7) SUBSEQUENT EVENTS
Events or transactions that occur after the balance sheet date but before the
financial statements are issued are categorized as recognized or non-recognized
for financial statement purposes. The Manager has evaluated subsequent events
through January 19, 2010, the date the financial statements were issued, and has
determined there were no events that required recognition or disclosure in the
Fund's financial statements. Subsequent events that will affect future financial
statements are as follows:
On December 4, 2009, the Fund received a reimbursement from SAS in the amount of
$32,000 related to corrections in fees paid for the administration and servicing
of certain accounts. This amount will be reflected on the statement of
operations as a reduction of expenses.
================================================================================
NOTES TO FINANCIAL STATEMENTS | 33
<PAGE>
================================================================================
(8) FINANCIAL HIGHLIGHTS
Per share operating performance for a share outstanding throughout each period
is as follows:
SIX-MONTH
PERIOD ENDED
NOVEMBER 30, YEAR ENDED MAY 31,
-----------------------------------------------------------------------------------
2009 2009 2008 2007 2006 2005
-----------------------------------------------------------------------------------
Net asset value at
beginning of period $ 9.97 $ 9.64 $ 9.45 $ 9.32 $ 9.76 $ 9.72
-----------------------------------------------------------------------------------
Income (loss) from
investment operations:
Net investment income .20 .43 .45 .44 .48 .47
Net realized and
unrealized gain (loss) .19 .33 .19 .13 (.44) .04
-----------------------------------------------------------------------------------
Total from investment
operations .39 .76 .64 .57 .04 .51
-----------------------------------------------------------------------------------
Less distributions from:
Net investment income (.20) (.43) (.45) (.44) (.48) (.47)
-----------------------------------------------------------------------------------
Net asset value at end
of period $ 10.16 $ 9.97 $ 9.64 $ 9.45 $ 9.32 $ 9.76
===================================================================================
Total return (%)* 3.91 8.05 6.94 6.25(a) .40 5.33
Net assets at end
of period (000) $606,809 $564,253 $513,665 $504,626 $521,176 $594,211
Ratios to average
net assets:**
Expenses (%)(b) .43(c) .55 .51 .52(a) .49 .48
Net investment income (%) 3.91(c) 4.38 4.74 4.69 4.46 4.06
Portfolio turnover (%) 12 20 11 14 26 37
* Assumes reinvestment of all net investment income and realized capital gain
distributions, if any, during the period. Includes adjustments in accordance
with U.S. generally accepted accounting principles and could differ from the
Lipper reported return.
** For the six-month period ended November 30, 2009, average net assets were
$580,459,000.
(a) For the year ended May 31, 2007, SAS voluntarily reimbursed the Fund for a
portion of the transfer agent's fees incurred. The reimbursement had no
effect on the Fund's total return or ratio of expenses to average net
assets.
(b) Reflects total operating expenses of the Fund before reductions of any
expenses paid indirectly. The Fund's expenses paid indirectly decreased the
expense ratios by less than 0.01%.
(c) Annualized. The ratio is not necessarily indicative of 12 months of
operations.
================================================================================
34 | USAA GNMA TRUST
<PAGE>
================================================================================
EXPENSE EXAMPLE
November 30, 2009 (unaudited)
--------------------------------------------------------------------------------
EXAMPLE
As a shareholder of the Fund, you incur two types of costs: direct costs, such
as wire fees, redemption fees, and low balance fees; and indirect costs,
including management fees, transfer agency fees, and other Fund operating
expenses. This example is intended to help you understand your indirect costs,
also referred to as "ongoing costs" (in dollars), of investing in the Fund and
to compare these costs with the ongoing costs of investing in other mutual
funds.
The example is based on an investment of $1,000 invested at the beginning of the
period and held for the entire six-month period of June 1, 2009, through
November 30, 2009.
ACTUAL EXPENSES
The first line of the table on the next page provides information about actual
account values and actual expenses. You may use the information in this line,
together with the amount you invested at the beginning of the period, to
estimate the expenses that you paid over the period. Simply divide your account
value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6),
then multiply the result by the number in the first line under the heading
"Expenses Paid During Period" to estimate the expenses you paid on your account
during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The second line of the table provides information about hypothetical account
values and hypothetical expenses based on the Fund's actual expense ratio and an
assumed rate of return of 5% per year before expenses, which is not the Fund's
actual return. The hypothetical
================================================================================
EXPENSE EXAMPLE | 35
<PAGE>
================================================================================
account values and expenses may not be used to estimate the actual ending
account balance or expenses you paid for the period. You may use this
information to compare the ongoing costs of investing in 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 other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any direct costs, such as wire fees,
redemption fees, or low balance fees. Therefore, the second line of the table is
useful in comparing ongoing costs only, and will not help you determine the
relative total costs of owning different funds. In addition, if these direct
costs were included, your costs would have been higher.
EXPENSES PAID
BEGINNING ENDING DURING PERIOD*
ACCOUNT VALUE ACCOUNT VALUE JUNE 1, 2009 -
JUNE 1, 2009 NOVEMBER 30, 2009 NOVEMBER 30, 2009
------------------------------------------------------------
Actual $1,000.00 $1,039.10 $2.20
Hypothetical
(5% return before expenses) 1,000.00 1,022.91 2.18
* Expenses are equal to the Fund's annualized expense ratio of 0.43%, which is
net of any expenses paid indirectly, multiplied by the average account value
over the period, multiplied by 183 days/365 days (to reflect the one-half-year
period). The Fund's ending account value on the first line in the table is
based on its actual total return of 3.91% for the six-month period of June 1,
2009, through November 30, 2009.
================================================================================
36 | USAA GNMA TRUST
<PAGE>
================================================================================
TRUSTEES Christopher W. Claus
Barbara B. Dreeben
Robert L. Mason, Ph.D.
Barbara B. Ostdiek, Ph.D.
Michael F. Reimherr
Richard A. Zucker
--------------------------------------------------------------------------------
ADMINISTRATOR, USAA Investment Management Company
INVESTMENT ADVISER, P.O. Box 659453
UNDERWRITER, AND San Antonio, Texas 78265-9825
DISTRIBUTOR
--------------------------------------------------------------------------------
TRANSFER AGENT USAA Shareholder Account Services
9800 Fredericksburg Road
San Antonio, Texas 78288
--------------------------------------------------------------------------------
CUSTODIAN AND State Street Bank and Trust Company
ACCOUNTING AGENT P.O. Box 1713
Boston, Massachusetts 02105
--------------------------------------------------------------------------------
INDEPENDENT Ernst & Young LLP
REGISTERED PUBLIC 100 West Houston St., Suite 1800
ACCOUNTING FIRM San Antonio, Texas 78205
--------------------------------------------------------------------------------
MUTUAL FUND Under "Products & Services"
SELF-SERVICE 24/7 click "Investments," then
AT USAA.COM "Mutual Funds"
OR CALL Under "My Accounts" go to
(800) 531-USAA "Investments." View account balances,
(8722) or click "I want to...," and select
the desired action.
--------------------------------------------------------------------------------
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. These Forms N-Q are
available at no charge (i) by calling (800) 531-USAA (8722); (ii) at USAA.COM;
and (iii) on the SEC's Web site at HTTP://WWW.SEC.GOV. These Forms N-Q also may
be reviewed and copied at the SEC's Public Reference Room in Washington, D.C.
Information on the operation of the Public Reference Room may be obtained by
calling (800) 732-0330.
================================================================================
<PAGE>
USAA
9800 Fredericksburg Road --------------
San Antonio, TX 78288 PRSRT STD
U.S. Postage
PAID
USAA
--------------
>> SAVE PAPER AND FUND COSTS
At USAA.COM click: MY DOCUMENTS
Set preferences to USAA DOCUMENTS ONLINE.
[LOGO OF USAA]
USAA WE KNOW WHAT IT MEANS TO SERVE.(R)
=============================================================================
23414-0110 (C)2010, USAA. All rights reserved.
ITEM 2. CODE OF ETHICS.
NOT APPLICABLE. This item must be disclosed only in annual reports.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
NOT APPLICABLE. This item must be disclosed only in annual reports.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
NOT APPLICABLE. This item must be disclosed only in annual reports.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not Applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Filed as part of the report to shareholders.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not Applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not Applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not Applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The Corporate Governance Committee selects and nominates candidates for
membership on the Board as independent directors. Currently, there is no
procedure for shareholders to recommend candidates to serve on the Board.
ITEM 11. CONTROLS AND PROCEDURES
The principal executive officer and principal financial officer of USAA Mutual
Funds Trust (Trust) have concluded that the Trust's disclosure controls and
procedures are sufficient to ensure that information required to be disclosed by
the Trust in this Form N-CSR/S was recorded, processed, summarized and reported
within the time periods specified in the Securities and Exchange Commission's
rules and forms, based upon such officers' evaluation of these controls and
procedures as of a date within 90 days of the filing date of the report.
There were no significant changes or corrective actions with regard to
significant deficiencies or material weaknesses in the Trust's internal controls
or in other factors that could significantly affect the Trust's internal
controls subsequent to the date of their evaluation. The only change to the
procedures was to document the annual disclosure controls and procedures
established for the new section of the shareholder reports detailing the factors
considered by the Funds' Board in approving the Funds' advisory agreements.
ITEM 12. EXHIBITS.
(a)(1). NOT APPLICABLE. This item must be disclosed only in annual reports.
(a)(2). Certification pursuant to Rule 30a-2(a) under the Investment Company Act
of 1940 (17 CFR 270.30a-2(a)) is filed and attached hereto as Exhibit
99.CERT.
(a)(3). Not Applicable.
(b). Certification pursuant to Rule 30a-2(b) under the Investment Company Act
of 1940 (17 CFR 270.30a-2(b))is filed and attached hereto as Exhibit
99.906CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Registrant: USAA MUTUAL FUNDS TRUST, Period Ended November 30, 2009
By:* CHRISTOPHER P. LAIA
-----------------------------------------------------------
Signature and Title: Christopher P. Laia, Assistant Secretary
Date: 01/26/2010
------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By:* CHRISTOPHER W. CLAUS
-----------------------------------------------------
Signature and Title: Christopher W. Claus, President
Date: 01/27/2010
------------------------------
By:* ROBERTO GALINDO, JR.
-----------------------------------------------------
Signature and Title: Roberto Galindo, Jr., Treasurer
Date: 01/27/2010
------------------------------
*Print the name and title of each signing officer under his or her signature.
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