UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF
REGISTERED MANAGEMENT INVESTMENT COMPANY
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: DECEMBER 31
Date of Reporting Period: MARCH 31, 2010
ITEM 1. SCHEDULE OF INVESTMENTS.
USAA MUTUAL FUNDS TRUST - 1ST QUARTER REPORT - PERIOD ENDED MARCH 31, 2010
[LOGO OF USAA]
USAA(R)
PORTFOLIO OF INVESTMENTS
1ST QUARTER
USAA TOTAL RETURN STRATEGY FUND(R)
MARCH 31, 2010
(Form N-Q)
(c)2010, USAA. All rights reserved.
48701-0510
<PAGE>
================================================================================
PORTFOLIO OF INVESTMENTS
USAA TOTAL RETURN STRATEGY FUND
March 31, 2010 (unaudited)
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
LONG POSITIONS (101.3%)
COMMON STOCKS (20.3%)(a)
CONSUMER DISCRETIONARY (3.4%)
-----------------------------
APPAREL & ACCESSORIES & LUXURY GOODS (0.1%)
3,000 Coach, Inc. $ 119
----------
APPAREL RETAIL (0.2%)
5,700 Ross Stores, Inc. 305
----------
AUTO PARTS & EQUIPMENT (0.4%)
5,600 Autoliv, Inc.* 288
8,300 Johnson Controls, Inc. 274
----------
562
----------
AUTOMOTIVE RETAIL (0.2%)
7,100 Advance Auto Parts, Inc. 298
----------
CABLE & SATELLITE (0.3%)
6,020 Time Warner Cable, Inc. 321
9,300 Virgin Media, Inc. 160
----------
481
----------
CONSUMER ELECTRONICS (0.1%)
4,900 Garmin Ltd. 189
----------
DISTRIBUTORS (0.2%)
5,900 Genuine Parts Co. 249
----------
EDUCATION SERVICES (0.2%)
2,300 Career Education Corp.* 73
4,600 DeVry, Inc. 300
----------
373
----------
GENERAL MERCHANDISE STORES (0.1%)
3,000 Big Lots, Inc.* 109
----------
HOME IMPROVEMENT RETAIL (0.1%)
2,800 Sherwin-Williams Co. 189
----------
HOMEFURNISHING RETAIL (0.1%)
8,500 Williams-Sonoma, Inc. 223
----------
HOUSEHOLD APPLIANCES (0.2%)
3,400 Whirlpool Corp. 297
----------
HOUSEWARES & SPECIALTIES (0.1%)
3,200 Jarden Corp. 107
----------
INTERNET RETAIL (0.2%)
900 Priceline.com, Inc.* 229
----------
LEISURE PRODUCTS (0.2%)
13,300 Mattel, Inc. 302
----------
================================================================================
1 | USAA TOTAL RETURN STRATEGY FUND
<PAGE>
================================================================================
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
RESTAURANTS (0.6%)
6,900 Darden Restaurants, Inc. $ 307
3,200 Panera Bread Co. "A"* 245
12,400 Starbucks Corp. 301
----------
853
----------
TIRES & RUBBER (0.1%)
15,000 Goodyear Tire & Rubber Co.* 190
----------
Total Consumer Discretionary 5,075
----------
CONSUMER STAPLES (1.7%)
-----------------------
AGRICULTURAL PRODUCTS (0.1%)
4,700 Corn Products International, Inc. 163
----------
FOOD RETAIL (0.1%)
3,600 Safeway, Inc. 89
----------
HOUSEHOLD PRODUCTS (0.3%)
3,500 Colgate-Palmolive Co. 298
2,300 Kimberly-Clark Corp. 145
----------
443
----------
HYPERMARKETS & SUPER CENTERS (0.1%)
2,400 BJ's Wholesale Club, Inc.* 89
----------
PACKAGED FOODS & MEAT (0.8%)
21,400 Del Monte Foods Co. 312
7,000 Hershey Co. 300
11,900 Sara Lee Corp. 166
9,200 Smithfield Foods, Inc.* 191
16,300 Tyson Foods, Inc. "A" 312
----------
1,281
----------
PERSONAL PRODUCTS (0.3%)
4,800 Estee Lauder Companies, Inc. "A" 311
2,800 Herbalife Ltd. 129
----------
440
----------
SOFT DRINKS (0.0%)
2,700 Coca-Cola Enterprises, Inc. 75
----------
Total Consumer Staples 2,580
----------
ENERGY (1.4%)
-------------
INTEGRATED OIL & GAS (0.2%)
9,900 Marathon Oil Corp. 313
----------
OIL & GAS DRILLING (0.1%)
7,900 Rowan Companies, Inc.* 230
----------
OIL & GAS EQUIPMENT & SERVICES (0.4%)
12,800 Exterran Holdings, Inc.* 310
6,800 Oil States International, Inc.* 308
----------
618
----------
OIL & GAS EXPLORATION & PRODUCTION (0.6%)
4,700 Chesapeake Energy Corp. 111
19,300 Mariner Energy, Inc.* 289
5,500 Newfield Exploration Co.* 286
13,900 Quicksilver Resources, Inc.* 196
----------
882
----------
OIL & GAS STORAGE & TRANSPORTATION (0.1%)
3,600 Williams Companies, Inc. 83
----------
Total Energy 2,126
----------
================================================================================
PORTFOLIO OF INVESTMENTS | 2
<PAGE>
================================================================================
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
FINANCIALS (1.5%)
-----------------
ASSET MANAGEMENT & CUSTODY BANKS (0.2%)
2,200 Franklin Resources, Inc. $ 244
----------
CONSUMER FINANCE (0.4%)
3,600 American Express Co. 149
7,300 Capital One Financial Corp. 302
13,700 Discover Financial Services 204
----------
655
----------
DIVERSIFIED BANKS (0.2%)
8,100 Comerica, Inc. 308
----------
REAL ESTATE SERVICES (0.1%)
1,800 Jones Lang LaSalle, Inc. 131
----------
REGIONAL BANKS (0.4%)
55,800 Huntington Bancshares, Inc. 300
9,200 KeyCorp 71
2,100 M&T Bank Corp. 167
10,500 Marshall & Ilsley Corp. 84
----------
622
----------
REITs - MORTGAGE (0.1%)
10,000 Annaly Capital Management, Inc. 172
----------
REITs - RESIDENTIAL (0.1%)
6,000 Apartment Investment & Management Co. "A" 111
----------
Total Financials 2,243
----------
HEALTH CARE (2.4%)
------------------
BIOTECHNOLOGY (0.1%)
4,600 Gilead Sciences, Inc.* 209
----------
HEALTH CARE DISTRIBUTORS (0.6%)
10,300 AmerisourceBergen Corp. 298
8,600 Cardinal Health, Inc. 310
4,400 McKesson Corp. 289
----------
897
----------
HEALTH CARE EQUIPMENT (0.2%)
9,000 Hill-Rom Holdings, Inc. 245
5,200 Hologic, Inc.* 96
----------
341
----------
HEALTH CARE FACILITIES (0.4%)
8,100 Community Health Systems, Inc.* 299
6,900 Universal Health Services, Inc. "B" 242
----------
541
----------
HEALTH CARE SERVICES (0.2%)
4,600 Medco Health Solutions, Inc.* 297
----------
LIFE SCIENCES TOOLS & SERVICES (0.1%)
1,900 Millipore Corp.* 201
----------
MANAGED HEALTH CARE (0.6%)
12,300 Coventry Health Care, Inc.* 304
5,800 Humana, Inc.* 271
8,600 UnitedHealth Group, Inc. 281
----------
856
----------
PHARMACEUTICALS (0.2%)
9,400 Forest Laboratories, Inc.* 295
----------
================================================================================
3 | USAA TOTAL RETURN STRATEGY FUND
<PAGE>
================================================================================
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
Total Health Care $ 3,637
----------
INDUSTRIALS (2.9%)
------------------
AEROSPACE & DEFENSE (0.1%)
3,500 ITT Corp. 188
----------
AIR FREIGHT & LOGISTICS (0.2%)
4,800 United Parcel Service, Inc. "B" 309
----------
AIRLINES (0.2%)
4,100 Copa Holdings S.A. "A" 249
----------
BUILDING PRODUCTS (0.1%)
6,800 Owens Corning, Inc.* 173
----------
COMMERCIAL PRINTING (0.2%)
14,400 R.R. Donnelley & Sons Co. 307
----------
CONSTRUCTION & ENGINEERING (0.3%)
3,500 Jacobs Engineering Group, Inc.* 158
8,600 Shaw Group, Inc.* 296
1,700 URS Corp.* 84
----------
538
----------
CONSTRUCTION & FARM MACHINERY & HEAVY TRUCKS (0.5%)
3,900 Navistar International Corp.* 174
7,600 Oshkosh Corp.* 307
11,400 Trinity Industries, Inc. 228
----------
709
----------
ELECTRICAL COMPONENTS & EQUIPMENT (0.3%)
3,400 Hubbell, Inc. "B" 172
4,100 Rockwell Automation, Inc. 231
----------
403
----------
INDUSTRIAL CONGLOMERATES (0.4%)
3,600 3M Co. 301
8,000 Carlisle Companies, Inc. 305
----------
606
----------
INDUSTRIAL MACHINERY (0.4%)
4,700 Parker-Hannifin Corp. 304
10,600 Timken Co. 318
----------
622
----------
TRUCKING (0.2%)
6,300 Ryder System, Inc. 244
----------
Total Industrials 4,348
----------
INFORMATION TECHNOLOGY (3.9%)
-----------------------------
APPLICATION SOFTWARE (0.1%)
16,500 Compuware Corp.* 139
----------
COMMUNICATIONS EQUIPMENT (0.2%)
3,600 EchoStar Corp. "A"* 73
4,000 Harris Corp. 190
----------
263
----------
COMPUTER HARDWARE (0.3%)
2,300 International Business Machines Corp. 295
7,700 Teradata Corp.* 222
----------
517
----------
COMPUTER STORAGE & PERIPHERALS (0.3%)
6,100 Lexmark International, Inc. "A"* 220
================================================================================
PORTFOLIO OF INVESTMENTS | 4
<PAGE>
================================================================================
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
6,600 Western Digital Corp.* $ 257
----------
477
----------
DATA PROCESSING & OUTSOURCED SERVICES (0.6%)
5,600 Computer Sciences Corp.* 305
2,900 DST Systems, Inc. 120
6,100 Global Payments, Inc. 278
4,000 Hewitt Associates, Inc. "A"* 159
----------
862
----------
ELECTRONIC COMPONENTS (0.2%)
28,400 Vishay Intertechnology, Inc.* 291
----------
ELECTRONIC MANUFACTURING SERVICES (0.2%)
17,200 Jabil Circuit, Inc. 279
----------
IT CONSULTING & OTHER SERVICES (0.3%)
5,300 Amdocs Ltd.* 160
15,900 SAIC, Inc.* 281
----------
441
----------
OFFICE ELECTRONICS (0.2%)
31,500 Xerox Corp. 307
----------
SEMICONDUCTORS (0.3%)
16,300 Fairchild Semiconductor International, Inc.* 174
7,100 Marvell Technology Group Ltd.* 145
13,300 Micron Technology, Inc.* 138
----------
457
----------
SYSTEMS SOFTWARE (0.5%)
9,700 Microsoft Corp. 284
7,000 Red Hat, Inc.* 205
17,400 Symantec Corp.* 294
----------
783
----------
TECHNOLOGY DISTRIBUTORS (0.7%)
10,600 Arrow Electronics, Inc.* 319
10,800 Avnet, Inc.* 324
6,100 Ingram Micro, Inc. "A"* 107
7,300 Tech Data Corp.* 306
----------
1,056
----------
Total Information Technology 5,872
----------
MATERIALS (1.5%)
----------------
DIVERSIFIED CHEMICALS (0.5%)
9,600 Cabot Corp. 292
3,000 Eastman Chemical Co. 191
23,500 Huntsman Corp. 283
----------
766
----------
DIVERSIFIED METALS & MINING (0.1%)
1,100 Walter Industries, Inc. 102
----------
PAPER PRODUCTS (0.3%)
12,200 International Paper Co. 300
9,600 MeadWestvaco Corp. 246
----------
546
----------
SPECIALTY CHEMICALS (0.4%)
6,600 Cytec Industries, Inc. 308
3,300 Lubrizol Corp. 303
----------
611
----------
================================================================================
5 | USAA TOTAL RETURN STRATEGY FUND
<PAGE>
================================================================================
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
STEEL (0.2%)
6,300 Reliance Steel & Aluminum Co. $ 310
----------
Total Materials 2,335
----------
TELECOMMUNICATION SERVICES (0.9%)
---------------------------------
INTEGRATED TELECOMMUNICATION SERVICES (0.3%)
47,000 Qwest Communications International, Inc. 245
8,400 Verizon Communications, Inc. 261
----------
506
----------
WIRELESS TELECOMMUNICATION SERVICES (0.6%)
10,700 MetroPCS Communications, Inc.* 76
55,000 Sprint Nextel Corp.* 209
9,000 Telephone & Data Systems, Inc. 305
5,900 U.S. Cellular Corp.* 244
----------
834
----------
Total Telecommunication Services 1,340
----------
UTILITIES (0.7%)
----------------
INDEPENDENT POWER PRODUCERS & ENERGY TRADERS (0.3%)
5,800 Constellation Energy Group, Inc. 204
10,700 NRG Energy, Inc.* 223
----------
427
----------
MULTI-UTILITIES (0.4%)
6,600 Integrys Energy Group, Inc. 313
6,600 MDU Resources Group, Inc. 142
7,000 NSTAR 248
----------
703
----------
Total Utilities 1,130
----------
Total Common Stocks (cost: $25,073) 30,686
----------
EXCHANGE-TRADED FUNDS (74.0%)
956,354 SPDR Trust Series 1(b) (cost: $122,725) 111,884
----------
HEDGE FUNDS (6.2%)
517,063 Deutsche iGAP Investment Trust "B" ,
acquired 8/01/2008; cost: $10,000*(c),(d) 9,379
----------
MONEY MARKET INSTRUMENTS (0.8%)
-------------------------------
MONEY MARKET FUNDS (0.8%)
1,108,991 State Street Institutional Liquid Reserve Fund,
0.13%(a),(e) (cost: $1,109) 1,109
----------
Total Long Positions (cost: $158,907) 153,058
----------
TOTAL INVESTMENTS (COST: $158,907) $ 153,058
==========
SHORT POSITIONS (20.4%)
COMMON STOCKS (20.4%)
CONSUMER DISCRETIONARY (3.3%)
-----------------------------
APPAREL RETAIL (0.2%)
6,000 Abercrombie & Fitch Co. "A" 274
----------
================================================================================
PORTFOLIO OF INVESTMENTS | 6
<PAGE>
================================================================================
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
AUTO PARTS & EQUIPMENT (0.2%)
8,000 BorgWarner, Inc.* $ 305
----------
AUTOMOBILE MANUFACTURERS (0.1%)
5,900 Thor Industries, Inc. 178
----------
AUTOMOTIVE RETAIL (0.4%)
12,200 CarMax, Inc.* 306
7,300 O'Reilly Automotive, Inc.* 305
----------
611
----------
CASINOS & GAMING (0.5%)
10,800 Las Vegas Sands Corp.* 229
7,100 Penn National Gaming, Inc.* 197
6,700 WMS Industries, Inc.* 281
----------
707
----------
COMPUTER & ELECTRONICS RETAIL (0.1%)
8,100 GameStop Corp. "A"* 178
----------
DISTRIBUTORS (0.2%)
14,700 LKQ Corp.* 298
----------
EDUCATION SERVICES (0.2%)
4,800 Apollo Group, Inc. "A"* 294
----------
HOMEBUILDING (0.2%)
9,600 KB Home 161
6,900 Lennar Corp. "A" 119
----------
280
----------
HOTELS, RESORTS, & CRUISE LINES (0.1%)
2,000 Carnival Corp. 78
----------
HOUSEWARES & SPECIALTIES (0.1%)
10,800 Newell Rubbermaid, Inc. 164
----------
MOTORCYCLE MANUFACTURERS (0.2%)
10,900 Harley-Davidson, Inc. 306
----------
MOVIES & ENTERTAINMENT (0.3%)
8,500 Liberty Media Corp. - Capital "A"* 309
6,600 Walt Disney Co. 231
----------
540
----------
PUBLISHING (0.2%)
6,700 Meredith Corp. 230
1,800 Morningstar, Inc.* 87
----------
317
----------
RESTAURANTS (0.3%)
14,600 Burger King Holdings, Inc. 310
26,000 Wendy's/Arby's Group, Inc. "A" 130
----------
440
----------
Total Consumer Discretionary 4,970
----------
CONSUMER STAPLES (1.8%)
-----------------------
AGRICULTURAL PRODUCTS (0.2%)
4,800 Bunge Ltd. 296
----------
DISTILLERS & VINTNERS (0.2%)
7,700 Central European Distribution Corp.* 270
----------
DRUG RETAIL (0.3%)
8,300 CVS Caremark Corp. 303
================================================================================
7 | USAA TOTAL RETURN STRATEGY FUND
<PAGE>
================================================================================
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
2,400 Walgreen Co. $ 89
----------
392
----------
HOUSEHOLD PRODUCTS (0.2%)
4,800 Energizer Holdings, Inc.* 301
----------
PACKAGED FOODS & MEAT (0.5%)
11,700 Flowers Foods, Inc. 289
3,300 Green Mountain Coffee Roasters, Inc.* 320
5,700 McCormick & Co., Inc. 219
----------
828
----------
PERSONAL PRODUCTS (0.2%)
7,600 Avon Products, Inc. 257
----------
SOFT DRINKS (0.1%)
5,500 Hansen Natural Corp.* 239
----------
TOBACCO (0.1%)
7,900 Altria Group, Inc. 162
----------
Total Consumer Staples 2,745
----------
ENERGY (1.6%)
-------------
COAL & CONSUMABLE FUELS (0.3%)
4,400 Alpha Natural Resources, Inc.* 219
9,400 Arch Coal, Inc. 215
----------
434
----------
OIL & GAS DRILLING (0.1%)
4,700 Atwood Oceanics, Inc.* 163
----------
OIL & GAS EQUIPMENT & SERVICES (0.1%)
2,900 Dresser-Rand Group, Inc.* 91
----------
OIL & GAS EXPLORATION & PRODUCTION (0.9%)
8,200 Comstock Resources, Inc.* 261
18,700 Denbury Resources, Inc.* 315
7,300 EXCO Resources, Inc. 134
3,600 Noble Energy, Inc. 263
10,800 Petrohawk Energy Corp.* 219
5,800 Range Resources Corp. 272
----------
1,464
----------
OIL & GAS REFINING & MARKETING (0.2%)
9,200 Sunoco, Inc. 274
----------
Total Energy 2,426
----------
FINANCIALS (1.7%)
-----------------
ASSET MANAGEMENT & CUSTODY BANKS (0.2%)
5,500 Northern Trust Corp. 304
----------
INSURANCE BROKERS (0.2%)
5,300 Aon Corp. 226
----------
INVESTMENT BANKING & BROKERAGE (0.2%)
15,000 Charles Schwab Corp. 280
----------
MULTI-LINE INSURANCE (0.1%)
4,400 Genworth Financial, Inc. "A"* 81
----------
REGIONAL BANKS (0.5%)
3,400 Bank of Hawaii Corp. 153
21,687 First Horizon National Corp.* 305
18,900 TCF Financial Corp. 301
----------
759
----------
================================================================================
PORTFOLIO OF INVESTMENTS | 8
<PAGE>
================================================================================
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
REITs - INDUSTRIAL (0.1%)
16,800 ProLogis $ 222
----------
REITs - RESIDENTIAL (0.1%)
2,300 AvalonBay Communities, Inc. 198
----------
SPECIALIZED FINANCE (0.1%)
4,500 Moody's Corp. 134
----------
THRIFTS & MORTGAGE FINANCE (0.2%)
18,800 People's United Financial, Inc. 294
----------
Total Financials 2,498
----------
HEALTH CARE (2.6%)
------------------
BIOTECHNOLOGY (0.8%)
9,000 Amylin Pharmaceuticals, Inc.* 202
8,500 BioMarin Pharmaceutical, Inc.* 199
8,300 Dendreon Corp.* 303
3,300 United Therapeutics Corp.* 183
7,200 Vertex Pharmaceuticals, Inc.* 294
----------
1,181
----------
HEALTH CARE DISTRIBUTORS (0.1%)
7,100 Patterson Companies, Inc. 220
----------
HEALTH CARE EQUIPMENT (0.2%)
3,200 St. Jude Medical, Inc.* 131
2,500 Zimmer Holdings, Inc.* 148
----------
279
----------
HEALTH CARE FACILITIES (0.2%)
11,300 VCA Antech, Inc.* 317
----------
HEALTH CARE SUPPLIES (0.2%)
8,200 DENTSPLY International, Inc. 286
----------
HEALTH CARE TECHNOLOGY (0.2%)
13,700 Allscripts - Misys Healthcare Solutions, Inc.* 268
----------
LIFE SCIENCES TOOLS & SERVICES (0.5%)
5,100 Covance, Inc.* 313
5,300 Illumina, Inc.* 206
9,700 Pharmaceutical Product Development, Inc. 231
----------
750
----------
MANAGED HEALTH CARE (0.1%)
5,800 Health Net, Inc.* 144
----------
PHARMACEUTICALS (0.3%)
8,200 Merck & Co., Inc. 306
2,600 Watson Pharmaceuticals, Inc.* 109
----------
415
----------
Total Health Care 3,860
----------
INDUSTRIALS (2.1%)
------------------
AEROSPACE & DEFENSE (0.2%)
13,300 Spirit AeroSystems Holdings, Inc. "A"* 311
----------
AIRLINES (0.1%)
6,900 Continental Airlines, Inc. "B"* 152
----------
CONSTRUCTION & FARM MACHINERY & HEAVY TRUCKS (0.7%)
5,900 AGCO Corp.* 212
7,000 PACCAR, Inc. 303
14,200 Terex Corp.* 322
================================================================================
9 | USAA TOTAL RETURN STRATEGY FUND
<PAGE>
================================================================================
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
5,500 Wabtec Corp. $ 232
----------
1,069
----------
ELECTRICAL COMPONENTS & EQUIPMENT (0.2%)
4,800 AMETEK, Inc. 199
2,200 Roper Industries, Inc. 127
----------
326
----------
ENVIRONMENTAL & FACILITIES SERVICES (0.1%)
6,700 Waste Connections, Inc.* 227
----------
HUMAN RESOURCE & EMPLOYMENT SERVICES (0.1%)
4,200 Robert Half International, Inc. 128
----------
INDUSTRIAL CONGLOMERATES (0.1%)
5,800 McDermott International, Inc.* 156
----------
RAILROADS (0.4%)
5,300 CSX Corp. 270
4,200 Union Pacific Corp. 308
----------
578
----------
RESEARCH & CONSULTING SERVICES (0.1%)
2,900 FTI Consulting, Inc.* 114
----------
SECURITY & ALARM SERVICES (0.1%)
7,600 Corrections Corp. of America* 151
----------
Total Industrials 3,212
----------
INFORMATION TECHNOLOGY (4.0%)
-----------------------------
APPLICATION SOFTWARE (0.9%)
8,600 Adobe Systems, Inc.* 304
6,700 ANSYS, Inc.* 289
9,800 Autodesk, Inc.* 288
34,700 Cadence Design Systems, Inc.* 231
18,000 Nuance Communications, Inc.* 300
----------
1,412
----------
COMMUNICATIONS EQUIPMENT (0.4%)
34,500 Brocade Communications Systems, Inc.* 197
26,600 Motorola, Inc.* 187
4,700 QUALCOMM, Inc. 197
----------
581
----------
DATA PROCESSING & OUTSOURCED SERVICES (0.6%)
12,700 Fidelity National Information Services, Inc. 298
13,900 Total System Services, Inc. 217
2,000 Visa, Inc. "A" 182
17,200 Western Union Co. 292
----------
989
----------
ELECTRONIC COMPONENTS (0.2%)
13,800 Corning, Inc. 279
----------
ELECTRONIC EQUIPMENT & INSTRUMENTS (0.2%)
4,200 Itron, Inc.* 305
----------
HOME ENTERTAINMENT SOFTWARE (0.3%)
16,100 Activision Blizzard, Inc. 194
16,200 Electronic Arts, Inc.* 302
----------
496
----------
INTERNET SOFTWARE & SERVICES (0.3%)
18,100 Monster Worldwide, Inc.* 301
3,100 Sohu.com, Inc.* 169
----------
470
----------
================================================================================
PORTFOLIO OF INVESTMENTS | 10
<PAGE>
================================================================================
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
SEMICONDUCTOR EQUIPMENT (0.9%)
22,700 Applied Materials, Inc. $ 306
7,700 Lam Research Corp.* 287
20,800 MEMC Electronic Materials, Inc.* 319
10,100 Novellus Systems, Inc.* 253
5,100 Varian Semiconductor Equipment Associates, Inc.* 169
----------
1,334
----------
SEMICONDUCTORS (0.2%)
9,100 Linear Technology Corp. 257
----------
Total Information Technology 6,123
----------
MATERIALS (1.7%)
----------------
CONSTRUCTION MATERIALS (0.5%)
6,600 Eagle Materials, Inc. 175
3,100 Martin Marietta Materials, Inc. 259
5,700 Vulcan Materials Co. 269
----------
703
----------
DIVERSIFIED METALS & MINING (0.3%)
2,700 Compass Minerals International, Inc. 217
8,400 Southern Copper Corp. 266
----------
483
----------
FERTILIZERS & AGRICULTURAL CHEMICALS (0.4%)
4,300 Monsanto Co. 307
5,200 Mosaic Co. 316
----------
623
----------
FOREST PRODUCTS (0.2%)
6,900 Weyerhaeuser Co. 312
----------
GOLD (0.1%)
4,500 Royal Gold, Inc. 208
----------
STEEL (0.2%)
4,800 United States Steel Corp. 305
----------
Total Materials 2,634
----------
TELECOMMUNICATION SERVICES (0.9%)
---------------------------------
INTEGRATED TELECOMMUNICATION SERVICES (0.2%)
8,600 CenturyTel, Inc. 305
----------
WIRELESS TELECOMMUNICATION SERVICES (0.7%)
7,300 American Tower Corp. "A"* 311
8,300 Crown Castle International Corp.* 317
3,200 Leap Wireless International, Inc.* 52
8,800 SBA Communications Corp. "A"* 318
----------
998
----------
Total Telecommunication Services 1,303
----------
UTILITIES (0.7%)
----------------
ELECTRIC UTILITIES (0.1%)
8,300 Great Plains Energy, Inc. 154
2,500 Weststar Energy, Inc. 56
----------
210
----------
GAS UTILITIES (0.2%)
6,400 EQT Corp. 262
----------
INDEPENDENT POWER PRODUCERS & ENERGY TRADERS (0.2%)
10,400 Mirant Corp.* 113
================================================================================
11 | USAA TOTAL RETURN STRATEGY FUND
<PAGE>
================================================================================
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
2,000 Ormat Technologies, Inc. $ 56
30,400 RRI Energy, Inc.* 112
----------
281
----------
MULTI-UTILITIES (0.1%)
3,500 Sempra Energy 175
----------
WATER UTILITIES (0.1%)
6,800 Aqua America, Inc. 120
----------
Total Utilities 1,048
----------
Total Common Stocks (proceeds: $27,031) 30,819
----------
TOTAL SHORT POSITIONS (PROCEEDS: $27,031) $ 30,819
==========
NUMBER OF
CONTRACTS
--------------------------------------------------------------------------------
PURCHASED OPTIONS (0.2%)
146 Put - S&P 500 Index expiring May 22, 2010 at 1100 144
810 Put - S&P 500 Index expiring April 17, 2010 at 1075 91
----------
TOTAL PURCHASED OPTIONS (COST: $594) $ 235
==========
WRITTEN OPTIONS (1.8%)
(650) Call - S&P 500 Index expiring April 17, 2010 at 1145 (1,953)
(306) Call - S&P 500 Index expiring April 17, 2010 at 1150 (800)
----------
TOTAL WRITTEN OPTIONS (PREMIUMS RECEIVED: $2,080) $ (2,753)
==========
================================================================================
PORTFOLIO OF INVESTMENTS | 12
<PAGE>
================================================================================
($ IN 000s) VALUATION HIERARCHY
-------------------------------------------------------
(LEVEL 1)
QUOTED PRICES (LEVEL 2)
IN ACTIVE OTHER (LEVEL 3)
MARKETS SIGNIFICANT SIGNIFICANT
FOR IDENTICAL OBSERVABLE UNOBSERVABLE
ASSETS ASSETS INPUTS INPUTS TOTAL
----------------------------------------------------------------------------------------------------
LONG POSITIONS:
COMMON STOCKS $ 30,686 $ -- $ -- $ 30,686
EXCHANGE-TRADED FUNDS 111,884 -- -- 111,884
HEDGE FUNDS -- 9,379 -- 9,379
MONEY MARKET INSTRUMENTS 1,109 -- -- 1,109
PURCHASED OPTIONS 235 -- -- 235
----------------------------------------------------------------------------------------------------
Total $ 143,914 $ 9,379 $ -- $153,293
----------------------------------------------------------------------------------------------------
(LEVEL 1)
QUOTED PRICES (LEVEL 2)
IN ACTIVE OTHER (LEVEL 3)
MARKETS SIGNIFICANT SIGNIFICANT
FOR IDENTICAL OBSERVABLE UNOBSERVABLE
LIABILITIES LIABILITIES INPUTS INPUTS TOTAL
----------------------------------------------------------------------------------------------------
SHORT POSITIONS:
COMMON STOCKS $ (30,819) $ -- $ -- $(30,819)
WRITTEN OPTIONS (2,753) -- -- (2,753)
----------------------------------------------------------------------------------------------------
Total $ (33,572) $ -- $ -- $(33,572)
----------------------------------------------------------------------------------------------------
================================================================================
13 | USAA TOTAL RETURN STRATEGY FUND
<PAGE>
================================================================================
NOTES TO PORTFOLIO OF INVESTMENTS
March 31, 2010 (unaudited)
GENERAL NOTES
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 quarterly report pertains only to the USAA Total
Return Strategy Fund (the Fund), which is classified as nondiversified under the
1940 Act.
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. Equity securities, including exchange-traded funds (ETFs) and equity
securities sold short, except as otherwise noted, traded primarily on a domestic
securities exchange or the Nasdaq over-the-counter markets, are valued at the
last sales price or official closing price on the exchange or primary market on
which they trade. If no last sale or official closing price is reported or
available, the average of the bid and asked prices is generally used.
2. Equity securities trading in various foreign markets may take place on days
when the NYSE is closed. Further, when the NYSE is open, the foreign markets may
be closed. Therefore, the calculation of the Fund's net asset value (NAV) may
not take place at the same time the prices of certain foreign securities held by
the Fund are determined. In most cases, events affecting the values of foreign
securities that occur between the time of their last quoted sales or official
closing prices and the close of normal trading on the NYSE on a day the Fund's
NAV is calculated will not be reflected in the value of the Fund's foreign
securities. However, USAA Investment Management Company (the Manager), an
affiliate of the Fund, and the Fund's subadvisers, if applicable, will monitor
for events that would materially affect the value of the Fund's foreign
securities. The Fund's subadvisers have agreed to notify the Manager of
significant events they identify that would materially affect the value of the
Fund's foreign securities. If the Manager determines that a particular event
would materially affect the value of the Fund's foreign securities, then the
Manager, under valuation procedures approved by the Trust's Board of Trustees,
will consider such available information that it deems relevant to determine a
fair value for the affected foreign securities. In addition, the Fund may use
information from an external vendor or other sources to adjust the foreign
market closing prices of foreign equity securities to reflect what the Fund
believes to be the fair value of the securities as of the close of the NYSE.
Fair valuation of affected foreign equity securities may occur frequently based
on an assessment that events that occur on a fairly regular basis (such as U.S.
market movements) are significant.
3. Investments in open-end investment companies, hedge, or other funds, other
than ETFs, are valued at their NAV at the end of each business day.
================================================================================
NOTES TO PORTFOLIO OF INVESTMENTS | 14
<PAGE>
================================================================================
4. Debt securities purchased with original or remaining maturities of 60 days or
less may be valued at amortized cost, which approximates market value.
5. 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.
6. Repurchase agreements are valued at cost, which approximates market value.
7. Options are valued by a pricing service at the National Best Bid/Offer (NBBO)
composite price, which is derived from the best available bid and ask prices in
all participating options exchanges determined to most closely reflect market
value of the options at the time of computation of the Fund's NAV.
8. 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 the
Manager in consultation with the Fund's subadvisers, 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 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.
================================================================================
15 | USAA TOTAL RETURN STRATEGY FUND
<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. 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.
D. SHORT POSITIONS -- The Fund may engage in short sales (selling securities it
does not own) as part of its normal investment activities. Short positions are
collateralized by cash proceeds from the short sales and by designated long
positions. In order to sell securities it does not own, the Fund must borrow the
securities from a broker or lending agent. If the borrowed security pays a
dividend during this time, the Fund must pay the amount of the dividend to the
broker or lending agent. This amount is shown as "dividend expense" on the
Fund's statement of operations. The Fund is subject to risk of loss if the
broker executing the short sale or the lending agent were to fail to perform its
obligation under the contractual terms.
Short sales involve the risk that the Fund will incur a loss by subsequently
buying the security at a higher price than the price at which the Fund
previously sold the security short. Short sale transactions result in
off-balance-sheet risk because the ultimate obligation may exceed the amount
recorded as a liability. Because the Fund's loss on a short sale stems from
increases in the value of the security sold short, the extent of such loss, like
the price of the security sold short, is theoretically unlimited. By contrast, a
Fund's loss on a long position arises from decreases in the value of the
security held by the Fund and therefore is limited by the fact that a security's
value cannot drop below zero. A gain, limited to the price at which the Fund
sold the security short, or a loss, unlimited in size, will be recognized upon
the termination of a short sale.
The Fund may not always be able to close out a short position at a particular
time or at an acceptable price. The lender of securities sold short may request
that borrowed securities be returned to it on short notice, and the Fund may
have to buy the borrowed securities at an unfavorable price. If this occurs at a
time when other short sellers of the same security also want to cover their
positions, it is more likely that the Fund will have to cover its short sale at
an unfavorable price and potentially reduce or eliminate any gain, or increase
or cause a loss, as a result of the short sale.
================================================================================
NOTES TO PORTFOLIO OF INVESTMENTS | 16
<PAGE>
================================================================================
E. OPTION TRANSACTIONS -- The Fund is subject to equity price risk in the normal
course of pursuing its investment objectives. The Fund may use options on
underlying instruments, namely, equity securities, ETFs, and equity indexes, to
gain exposure to, or hedge against, changes in the value of equity securities,
ETFs, or equity indexes. A call option gives the purchaser the right to buy, and
the writer the obligation to sell, the underlying instrument at a specified
price during a specified period. Conversely, a put option gives the purchaser
the right to sell, and the writer the obligation to buy, the underlying
instrument at a specified price during a specified period. The purchaser of the
option pays a premium to the writer of the option.
Premiums paid for purchased options are recorded as an investment. If a
purchased option expires unexercised, the premium paid is recognized as a
realized loss. If a purchased call option on a security is exercised, the cost
of the security acquired includes the exercise price and the premium paid. If a
purchased put option on a security is exercised, the realized gain or loss on
the security sold is determined from the exercise price, the original cost of
the security, and the premium paid. The risk associated with purchasing a call
or put option is limited to the premium paid.
Premiums received from writing options are recorded as a liability. If a written
option expires unexercised, the premium received is recognized as a realized
gain. If a written call option on a security is exercised, the realized gain or
loss on the security sold is determined from the exercise price, the original
cost of the security, and the premium received. If a written put option on a
security is exercised, the cost of the security acquired is the exercise price
paid less the premium received. The Fund, as a writer of an option, bears the
market risk of an unfavorable change in the price of the security underlying the
written option.
In an attempt to reduce the Fund's volatility over time, the Fund may implement
a strategy that involves writing (selling) index call or corresponding ETF
options and purchasing index put or corresponding ETF options or index put
spread options against a highly correlated stock portfolio. The combination of
the diversified stock portfolio with the index call and put or corresponding ETF
options is designed to provide the Fund with consistent returns over a wide
range of equity market environments. This strategy may not fully protect the
Fund against declines in the portfolio's value, and the Fund could experience a
loss. Options on securities indexes or corresponding ETF options are different
from options on individual securities in that the holder of the index options
contract has the right to receive an amount of cash equal to the difference
between the exercise price and the closing price of the underlying index on
exercise date. If an option on an index is exercised, the realized gain or loss
is determined from the exercise price, the value of the underlying index, and
the amount of the premium.
F. SUBSEQUENT EVENTS -- Events or transactions that occur after the quarterly
report date, but before the quarterly report is issued are categorized as
recognized or non-recognized for quarterly report purposes. The Manager has
evaluated subsequent events through the date the quarterly report was issued,
and has determined there were no events that require recognition or disclosure
in the Fund's quarterly report.
G. As of March 31, 2010, the cost of securities, for federal income tax
purposes, was approximately the same as that reported in the portfolio of
investments. Gross unrealized appreciation and
================================================================================
17 | USAA TOTAL RETURN STRATEGY FUND
<PAGE>
================================================================================
depreciation of investments as of March 31, 2010, were $5,789,000 and
$11,997,000 respectively, resulting in net unrealized depreciation of
$6,208,000.
H. The portfolio of investments category percentages shown represent the
percentages of the investments to net assets, which were $151,143,000 at March
31, 2010, and, in total, may not equal 100%. A category percentage of 0.0%
represents less than 0.1% of net assets.
I. The Fund may rely on certain Securities and Exchange Commission (SEC)
exemptive orders or rules that permit funds meeting various conditions to invest
in an exchange-traded fund (ETF) in amounts exceeding limits set forth in the
Investment Company Act of 1940 that would otherwise be applicable.
CATEGORIES AND DEFINITIONS
HEDGE FUNDS -- private investment funds open to a limited range of investors and
exempt from certain regulations. Deutsche iGAP Investment Trust, managed by
Deutsche Bank Trust Company Americas, invests primarily in a diversified
portfolio of short-term money market investments, and long and short positions
in exchange-traded equity index and government bond index futures, currency
forward contracts, and other derivative instruments. As of March 31, 2010, the
Fund owns approximately 7% of the Class "B" shares of the iGAP fund and may
redeem all or part of its investment upon 10 days' prior written notice. The
Fund does not invest in the iGAP fund for the purpose of exercising management
or control.
PORTFOLIO ABBREVIATIONS AND DESCRIPTIONS
SPDR Exchange-traded funds, managed by State Street Global Advisers, that
represent a portfolio of stocks designed to closely track a specific
market index. SPDR is an acronym for the first member of the fund
family, Standard & Poor's Depositary Receipts, which tracks the S&P
500 Index. SPDRs are traded on securities exchanges.
REIT Real estate investment trust
SPECIFIC NOTES
(a) Securities are pledged with a broker as collateral for short positions
borrowed and segregated to cover the value of the short positions.
(b) At March 31, 2010, the security, or a portion thereof, is segregated to
cover the notional value of outstanding written call options.
(c) Restricted security that is not registered under the Securities Act of
1933.
(d) Security deemed illiquid by the Manager, under liquidity guidelines
approved by the Trust's Board of Trustees. The aggregate market value of
these securities at March 31, 2010, was $9,379,000, which represented
6.2% of the Fund's net assets.
(e) Rate represents the money market fund annualized seven-day yield at March
31, 2010.
* Non-income-producing security.
================================================================================
NOTES TO PORTFOLIO OF INVESTMENTS | 18
ITEM 2. 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-Q 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.
ITEM 3. EXHIBITS.
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.
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 March 31, 2010
By:* /s/ CHRISTOPHER P. LAIA
--------------------------------------------------------------
Signature and Title: Christopher P. Laia, Secretary
Date: 05/26/2010
-------------------------------
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:* /s/ CHRISTOPHER W. CLAUS
-----------------------------------------------------
Signature and Title: Christopher W. Claus, President
Date: 05/27/2010
------------------------------
By:* /s/ ROBERTO GALINDO, JR.
-----------------------------------------------------
Signature and Title: Roberto Galindo, Jr., Treasurer
Date: 05/26/2010
------------------------------
*PRINT THE NAME AND TITLE OF EACH SIGNING OFFICER UNDER HIS OR HER SIGNATURE.
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