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: JULY 31
Date of Reporting Period: APRIL 30, 2010
ITEM 1. SCHEDULE OF INVESTMENTS.
USAA MUTUAL FUNDS TRUST - 3RD QUARTER REPORT - PERIOD ENDED APRIL 30, 2010
[LOGO OF USAA]
USAA(R)
PORTFOLIO OF INVESTMENTS
3(RD) QUARTER
USAA CAPITAL GROWTH FUND
APRIL 30, 2010
(Form N-Q)
48491-0610 (C)2010, USAA. All rights reserved.
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PORTFOLIO OF INVESTMENTS
USAA CAPITAL GROWTH FUND
April 30, 2010 (unaudited)
MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
EQUITY SECURITIES (97.8%)
COMMON STOCKS (96.1%)
CONSUMER DISCRETIONARY (10.5%)
------------------------------
ADVERTISING (0.4%)
26,591 Publicis Groupe S.A. (a) $ 1,176
167,299 WPP plc (a) 1,779
-----------
2,955
-----------
APPAREL & ACCESSORIES & LUXURY GOODS (1.7%)
277,474 Burberry Group plc (a) 2,857
121,200 Coach, Inc. 5,060
31,534 LVMH Moet Hennessy - Louis Vuitton S.A. (a),(b) 3,605
-----------
11,522
-----------
APPAREL RETAIL (1.4%)
75,000 Aeropostale, Inc. * 2,178
89,000 Gap, Inc. 2,201
27,300 Ross Stores, Inc. 1,529
83,500 TJX Companies, Inc. 3,869
-----------
9,777
-----------
AUTOMOBILE MANUFACTURERS (1.3%)
84,799 Bayerische Motoren Werke A G (a) 4,155
1,108,000 Dongfeng Motor Group Co. Ltd. (a) 1,561
356,600 Nissan Motor Co. Ltd. *(a) 3,123
-----------
8,839
-----------
CABLE & SATELLITE (1.2%)
181,150 Cablevision Systems Corp. "A" 4,971
140,700 DISH Network Corp. "A" 3,116
-----------
8,087
-----------
CASINOS & GAMING (0.4%)
122,248 OPAP S.A. (a) 2,484
-----------
DEPARTMENT STORES (1.0%)
23,800 Kohl's Corp. * 1,309
100,200 Macy's, Inc. 2,325
79,300 Nordstrom, Inc. 3,277
-----------
6,911
-----------
DISTRIBUTORS (0.3%)
3,490,957 Inchcape plc *(a) 1,835
-----------
GENERAL MERCHANDISE STORES (0.9%)
54,600 Family Dollar Stores, Inc. 2,160
65,300 Target Corp. 3,714
-----------
5,874
-----------
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1 | USAA Capital Growth Fund
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MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
HOME IMPROVEMENT RETAIL (0.5%)
939,766 Kingfisher plc (a) $ 3,591
-----------
HOMEBUILDING (0.2%)
202,800 Gafisa SA 1,381
-----------
HOUSEWARES & SPECIALTIES (0.2%)
43,800 Jarden Corp. 1,407
-----------
LEISURE PRODUCTS (0.3%)
91,700 Mattel, Inc. 2,114
-----------
MOVIES & ENTERTAINMENT (0.5%)
234,900 News Corp. "A" 3,622
-----------
SPECIALIZED CONSUMER SERVICES (0.2%)
176,300 Service Corp. International 1,583
-----------
Total Consumer Discretionary 71,982
-----------
CONSUMER STAPLES (9.3%)
-----------------------
AGRICULTURAL PRODUCTS (0.5%)
3,849,077 Pan Fish ASA *(a) 3,561
-----------
BREWERS (1.2%)
26,710 Carlsberg A/S (a) 2,174
80,247 Heineken Holding N.V. (a) 3,288
59,678 Heineken N.V. (a),(b) 2,770
-----------
8,232
-----------
DRUG RETAIL (0.7%)
48,400 CVS Caremark Corp. 1,788
80,800 Walgreen Co. 2,840
-----------
4,628
-----------
FOOD RETAIL (0.5%)
221,400 SUP E RVALU, Inc. 3,299
-----------
HOUSEHOLD PRODUCTS (1.3%)
57,851 Clorox Co. 3,743
80,300 Kimberly-Clark Corp. 4,919
-----------
8,662
-----------
HYPERMARKETS & SUPER CENTERS (1.4%)
93,017 Metro A G (a),(b) 5,590
76,376 Wal-Mart Stores, Inc. 4,097
-----------
9,687
-----------
PACKAGED FOODS & MEAT (2.4%)
110,600 ConAgra Foods, Inc. 2,706
77,370 CSM N.V. (a) 2,502
301,450 Del Monte Foods Co. 4,504
382,300 Sara Lee Corp. 5,436
73,000 Tyson Foods, Inc. "A" 1,430
-----------
16,578
-----------
PERSONAL PRODUCTS (0.4%)
62,400 Herbalife Ltd. 3,011
-----------
TOBACCO (0.9%)
115,130 Altria Group, Inc. 2,440
45,900 Lorillard, Inc. 3,597
-----------
6,037
-----------
Total Consumer Staples 63,695
-----------
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Portfolio of Investments | 2
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MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
ENERGY (10.7%)
--------------
COAL & CONSUMABLE FUELS (0.9%)
556,000 China Shenhua Energy Co. Ltd. "H" *(a) $ 2,370
1,280,000 Yanzhou Coal Mining Co. Ltd. "H" (a) 3,572
-----------
5,942
-----------
INTEGRATED OIL & GAS (5.9%)
1,097,908 BP plc (a) 9,564
70,400 ConocoPhillips 4,167
129,212 ENI S.p.A. (a) 2,897
185,800 Exxon Mobil Corp. 12,606
24,700 Hess Corp. 1,570
90,347 Repsol YP F S.A. (a) 2,121
240,627 Royal Dutch Shell plc "A" (b) 7,551
-----------
40,476
-----------
OIL & GAS DRILLING (0.6%)
101,131 Noble Corp. * 3,994
-----------
OIL & GAS EQUIPMENT & SERVICES (1.1%)
72,071 Acergy S.A (a) 1,357
268,000 Aker Kvaerner ASA (a) 4,483
108,900 TGS-NOPE C Geophysical Co. ASA *(a) 2,090
-----------
7,930
-----------
OIL & GAS EXPLORATION & PRODUCTION (0.6%)
33,500 Canadian Natural Resources Ltd. 2,580
54,800 Nexen, Inc. 1,333
-----------
3,913
-----------
OIL & GAS REFINING & MARKETING (1.2%)
101,600 Sunoco, Inc. 3,330
239,000 Valero Energy Corp. 4,969
-----------
8,299
-----------
OIL & GAS STORAGE & TRANSPORTATION (0.4%)
104,800 Williams Companies, Inc. 2,474
-----------
Total Energy 73,028
-----------
FINANCIALS (18.9%)
------------------
DIVERSIFIED BANKS (8.5%)
166,830 Banco Santander S.A. (a),(b) 2,096
370,835 Bank Hapoalim Ltd. *(a) 1,490
4,820,000 Bank of China Ltd. "H" (a) 2,480
52,800 Bank of Montreal (b) 3,279
39,700 Bank of Nova Scotia 2,024
47,842 BNP Paribas S.A. (a),(b) 3,288
260,000 Bumiputra-Commerce Holdings Berhad (a) 1,152
34,400 Canadian Imperial Bank of Commerce 2,525
114,983 Danske Bank A/S *(a) 2,988
70,910 Hana Financial Group, Inc. (a) 2,194
4,483,000 Industrial and Commercial Bank of China Ltd. "H" (a) 3,289
108,774 National Australia Bank Ltd. (a) 2,780
29,600 National Bank of Canada 1,810
104,075 Nedcor Ltd. (a) 1,875
5,666,000 PT Bank Mandiri Tbk (a) 3,581
256,320 Standard Chartered plc (a) 6,832
324,000 Wells Fargo & Co. 10,728
256,570 Woori Finance Holdings Co. Ltd. (a) 4,053
-----------
58,464
-----------
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3 | USAA Capital Growth Fund
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MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
DIVERSIFIED CAPITAL MARKETS (1.1%)
160,460 Credit Suisse Group (a) $ 7,340
-----------
INVESTMENT BANKING & BROKERAGE (0.4%)
10,400 Goldman Sachs Group, Inc. 1,510
40,300 Morgan Stanley 1,218
-----------
2,728
-----------
LIFE & HEALTH INSURANCE (2.6%)
89,000 AFLAC, Inc. 4,535
42,100 Industrial Alliance Insurance 1,452
32,600 MetLife, Inc. 1,486
57,000 Principal Financial Group, Inc. 1,666
91,700 Prudential Financial, Inc. 5,828
95,000 Sun Life Financial, Inc. 2,794
-----------
17,761
-----------
MULTI-LINE INSURANCE (1.9%)
38,818 Allianz Holding A G (a),(b) 4,456
87,200 Assurant, Inc. 3,177
742,029 Aviva plc (a) 3,927
12,105 Topdanmark A/S *(a) 1,490
-----------
13,050
-----------
OTHER DIVERSIFIED FINANCIAL SERVICES (1.7%)
674,043 FirstRand Ltd. (a) 1,857
129,200 JPMorgan Chase & Co. 5,501
53,800 Toronto-Dominion Bank 3,999
-----------
11,357
-----------
PROPERTY & CASUALTY INSURANCE (1.0%)
107,900 Allstate Corp. 3,525
51,700 Aspen Insurance Holdings Ltd. 1,395
112,100 Progressive Corp. 2,252
-----------
7,172
-----------
REINSURANCE (1.7%)
76,384 Hannover Rueckversicherungs *(a),(b) 3,587
26,200 PartnerRe Ltd. 2,032
35,632 Reinsurance Group of America, Inc. "A" 1,840
27,000 RenaissanceRe Holdings Ltd. 1,511
47,000 Transatlantic Holdings, Inc. 2,337
-----------
11,307
-----------
Total Financials 129,179
-----------
HEALTH CARE (7.7%)
------------------
MANAGED HEALTH CARE (1.5%)
43,500 Humana, Inc. * 1,989
126,100 UnitedHealth Group, Inc. 3,822
85,700 WellPoint, Inc. * 4,611
-----------
10,422
-----------
PHARMACEUTICALS (6.2%)
104,600 Abbott Laboratories 5,351
166,343 AstraZeneca plc (a) 7,355
75,400 Bristol-Myers Squibb Co. 1,907
81,400 Merck & Co., Inc. 2,852
84,200 Mylan, Inc. * 1,855
252,721 Novartis AG (a) 12,894
40,314 Sanofi-Aventis S.A. *(a),(b) 2,760
76,350 Valeant Pharmaceuticals International * 3,436
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Portfolio of Investments | 4
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MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
132,400 Warner Chilcott plc "A" * $ 3,755
-----------
42,165
-----------
Total Health Care 52,587
-----------
INDUSTRIALS (10.3%)
-------------------
AEROSPACE & DEFENSE (1.2%)
27,000 Alliant Techsystems, Inc. * 2,185
309,104 BAE Systems plc (a) 1,625
19,700 L-3 Communications Holdings, Inc. 1,843
43,300 Raytheon Co. 2,524
-----------
8,177
-----------
AIRLINES (0.5%)
1,554,000 Cathay Pacific Airways *(a) 3,218
-----------
COMMERCIAL PRINTING (0.4%)
118,600 R.R. Donnelley & Sons Co. 2,549
-----------
CONSTRUCTION & ENGINEERING (1.4%)
48,000 Daelim Industrial Co. Ltd. (a) 2,719
38,573 Fomento de Construcciones y Contratas S.A. (a) 1,265
16,712 Hochtief AG (a) 1,383
64,482 Imtech N.V. (a) 2,029
91,988 YIT Oyj (a) 1,959
-----------
9,355
-----------
CONSTRUCTION & FARM MACHINERY & HEAVY TRUCKS (0.2%)
77,700 Tata Motors Ltd. ADR (b) 1,589
-----------
DIVERSIFIED SUPPORT SERVICES (0.4%)
487,373 Downer Group (a) 3,144
-----------
ELECTRICAL COMPONENTS & EQUIPMENT (0.9%)
44,525 Nexans S.A. (a) 3,531
197,800 Sumitomo Electric Industries Ltd. (a) 2,442
-----------
5,973
-----------
INDUSTRIAL CONGLOMERATES (1.5%)
370,000 Keppel Corp. Ltd. (a) 2,628
44,240 LG Corp. (a) 3,003
15,853 Siemens AG (a) 1,567
45,907 Wendel (a) 2,970
-----------
10,168
-----------
INDUSTRIAL MACHINERY (1.5%)
264,414 IMI plc (a) 2,852
117,700 JTEKT Corp. (a) 1,357
39,844 Metso Corp. (a) 1,538
29,763 Sulzer AG (a) 2,955
134,510 The Weir Group plc (a) 2,017
-----------
10,719
-----------
RESEARCH & CONSULTING SERVICES (0.6%)
99,700 FTI Consulting, Inc. * 4,101
-----------
TRADING COMPANIES & DISTRIBUTORS (1.7%)
348,000 Marubeni Corp. (a) 2,062
178,100 Mitsubishi Corp. (a) 4,226
242,300 Mitsui & Co. Ltd. (a) 3,656
99,400 Toyota Tsusho Corp. (a) 1,489
-----------
11,433
-----------
Total Industrials 70,426
-----------
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5 | USAA Capital Growth Fund
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MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
INFORMATION TECHNOLOGY (13.0%)
------------------------------
COMMUNICATIONS EQUIPMENT (0.6%)
61,800 Research In Motion Ltd. * $ 4,405
-----------
COMPUTER HARDWARE (3.3%)
284,000 Fujitsu Ltd. (a) 2,010
116,600 Hewlett-Packard Co. 6,060
114,900 International Business Machines Corp. 14,822
-----------
22,892
-----------
DATA PROCESSING & OUTSOURCED SERVICES (0.7%)
57,600 Computer Sciences Corp. * 3,018
39,400 Hewitt Associates, Inc. "A" * 1,615
-----------
4,633
-----------
ELECTRONIC MANUFACTURING SERVICES (0.5%)
205,600 Jabil Circuit, Inc. 3,150
-----------
INTERNET SOFTWARE & SERVICES (1.2%)
10,700 Google, Inc. "A" * 5,622
125,400 Tencent Holdings Ltd. (a) 2,574
-----------
8,196
-----------
IT CONSULTING & OTHER SERVICES (0.3%)
38,700 Cognizant Technology Solutions Corp. "A" * 1,981
-----------
SEMICONDUCTORS (1.7%)
534,287 Infineon Technologies A G *(a) 3,789
98,500 Intel Corp. 2,249
333,125 Micron Technology, Inc. * 3,115
689,100 United Microelectronics Corp. ADR * 2,439
-----------
11,592
-----------
SYSTEMS SOFTWARE (4.1%)
44,300 BMC Software, Inc. * 1,743
548,591 Microsoft Corp. 16,754
369,000 Oracle Corp. 9,535
-----------
28,032
-----------
TECHNOLOGY DISTRIBUTORS (0.6%)
138,500 Arrow Electronics, Inc. * 4,224
-----------
Total Information Technology 89,105
-----------
MATERIALS (6.9%)
----------------
DIVERSIFIED CHEMICALS (1.3%)
49,246 BAS F A G (a),(b) 2,879
54,600 E astman Chemical Co. 3,654
969,000 Showa Denko K.K. (a) 2,217
-----------
8,750
-----------
DIVERSIFIED METALS & MINING (4.1%)
52,422 Anglo American Capital plc *(a) 2,245
306,255 BHP Billiton plc (a) 9,409
44,700 First Quantum Minerals Ltd. 3,430
58,874 KGHM Polska Miedz S.A. (a) 2,201
164,918 Rio Tinto plc (a) 8,319
71,000 Teck Cominco Ltd. * 2,790
-----------
28,394
-----------
GOLD (0.3%)
34,600 Newmont Mining Corp. 1,940
-----------
PAPER PRODUCTS (0.4%)
1,846 MeadW estvaco Corp. 50
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Portfolio of Investments | 6
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MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
1,510,000 Nine Dragons Paper Holdings Ltd. (a) $ 2,540
-----------
2,590
-----------
STEEL (0.8%)
72,009 Evraz Group S.A. GDR * 2,636
101,696 Severstal Joint Stock Co. * 1,390
49,793 ThyssenKrupp A G (a) 1,631
-----------
5,657
-----------
Total Materials 47,331
-----------
TELECOMMUNICATION SERVICES (4.3%)
---------------------------------
INTEGRATED TELECOMMUNICATION SERVICES (2.6%)
236,050 AT&T, Inc. 6,152
653,929 BT Group plc (a) 1,266
60,650 KT Corp. (a) 2,707
46,100 Nippon Telegraph & Telephone Corp. (a) 1,871
582,308 Portugal Telecom S GPS S.A. *(a),(b) 5,904
-----------
17,900
-----------
WIRELESS TELECOMMUNICATION SERVICES (1.7%)
55,700 Mobile TeleSystems ADR 3,077
105,714 Sistema JS F C GDR *(a) 2,819
2,532,882 Vodafone Group plc (a) 5,631
-----------
11,527
-----------
Total Telecommunication Services 29,427
-----------
UTILITIES (4.5%)
----------------
ELECTRIC UTILITIES (1.4%)
807,727 E DP-Energias de Portugal (a),(b) 2,871
159,300 Kansai Electric Power Co., Inc. (a) 3,544
64,091 Red Electrica de Espana (a) 3,033
-----------
9,448
-----------
GAS UTILITIES (1.2%)
792,935 Snam Rete Gas S.p.A. (a) 3,757
499,000 Tokyo Gas Co. Ltd. (a) 2,117
88,000 UGI Corp. 2,419
-----------
8,293
-----------
INDEPENDENT POWER PRODUCERS & ENERGY TRADERS (0.3%)
56,800 Constellation Energy Group, Inc. 2,008
-----------
MULTI-UTILITIES (1.6%)
79,400 DTE Energy Co. 3,825
93,200 Integrys Energy Group, Inc. 4,623
59,400 P G&E Corp. 2,602
-----------
11,050
-----------
Total Utilities 30,799
-----------
Total Common Stocks (cost: $600,417) 657,559
-----------
PREFERRED SECURITIES (1.7%)
CONSUMER DISCRETIONARY (0.4%)
-----------------------------
BROADCASTING (0.4%)
127,892 ProSiebenSat.1 Media AG (a) 2,413
-----------
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7 | USAA Capital Growth Fund
<PAGE>
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MARKET
NUMBER VALUE
OF SHARES SECURITY (000)
--------------------------------------------------------------------------------
FINANCIALS (1.1%)
-----------------
DIVERSIFIED BANKS (1.1%)
343,300 Banco Itau Holding Financeira S.A. $ 7,446
-----------
INDUSTRIALS (0.2%)
------------------
TRADING COMPANIES & DISTRIBUTORS (0.2%)
246,600 Itausa - Investimentos Itau S.A. 1,701
-----------
Total Preferred Securities (cost: $10,659) 11,560
-----------
Total Equity Securities (cost: $611,076) 669,119
-----------
MONEY MARKET INSTRUMENTS (2.0%)
MONEY MARKET FUNDS (2.0%)
13,747,427 State Street Institutional Liquid Reserve Fund,
0.16% (c)(cost: $13,747) 13,747
-----------
SHORT-TERM INVESTMENTS PURCHASED WITH CASH COLLATERAL
FROM SECURITIES LOANED (7.9%)
MONEY MARKET FUNDS (1.6%)
5,937 BlackRock Liquidity Funds TempFund Portfolio, 0.14% (c) 6
10,601,627 Fidelity Institutional Money Market Fund, 0.21% (c) 10,602
-----------
Total Money Market Funds (cost: $10,608) 10,608
-----------
PRINCIPAL
AMOUNT
(000)
--------------------------------------------------------------------------------
REPURCHASE AGREEMENTS (6.3%)
$ 30,100 Credit Suisse First Boston LLC, 0.19%, acquired on
4/30/2010 and due 5/03/2010 at $30,100
(collateralized by $30,720 of Fannie Mae(d),
0.18%(e), due 7/28/2010; market value $30,705) 30,100
13,100 Deutsche Bank Securities, Inc., 0.19%, acquired on
04/30/2010 and due 05/03/2010 at $13,100
(collateralized by $12,684 of U.S. Treasury,
1.13%-6.13%, due 1/15/2012-11/15/2027;
market value $13,362) 13,100
-----------
Total Repurchase Agreements 43,200
-----------
Total Short-term Investments Purchased With Cash
Collateral From Securities Loaned (cost: $53,808) 53,808
-----------
TOTAL INVESTMENTS (COST: $678,631) $ 736,674
===========
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Portfolio of Investments | 8
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($ 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
----------------------------------------------------------------------------------------------------
EQUITY SECURITIES:
COMMON STOCKS $371,138 $286,421 $-- $657,559
PREFERRED SECURITIES 9,146 2,413 -- 11,559
MONEY MARKET INSTRUMENTS:
MONEY MARKET FUNDS 13,748 -- -- 13,748
SHORT-TERM INVESTMENTS PURCHASED
WITH CASH COLLATERAL FROM
SECURITIES LOANED:
MONEY MARKET FUNDS 10,608 -- -- 10,608
REPURCHASE AGREEMENTS -- 43,200 -- 43,200
----------------------------------------------------------------------------------------------------
Total $404,640 $332,034 $-- $736,674
----------------------------------------------------------------------------------------------------
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9 | USAA Capital Growth Fund
<PAGE>
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NOTES TO PORTFOLIO OF INVESTMENTS
April 30, 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 Capital
Growth Fund (the Fund), which is classified as diversified 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), 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. Equity
securities traded primarily on foreign securities exchanges or markets are
valued at the last quoted sales price, or the most recently determined official
closing price calculated according to local market convention, available at the
time the Fund is valued. 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 subadviser, if applicable, will monitor
for events that would materially affect the value of the Fund's foreign
securities. The Fund's subadviser has agreed to notify the Manager of
significant events it identifies 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.
================================================================================
Notes to Portfolio of Investments | 10
<PAGE>
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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.
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. Repurchase agreements are valued at cost, which approximates market value.
6. 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 subadviser, if applicable, 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.
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
================================================================================
11 | USAA Capital Growth Fund
<PAGE>
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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. LENDING OF PORTFOLIO SECURITIES - The Fund, through its third-party
securities-lending agent, Wachovia Global Securities Lending, may lend its
securities to qualified financial institutions, such as certain broker-dealers,
to earn additional income. The borrowers are required to secure their loans
continuously with cash collateral in an amount at least equal to the fair value
of the securities loaned, initially in an amount at least equal to 102% of the
fair value of domestic securities loaned and 105% of the fair value of
international securities loaned. Cash collateral is invested in high-quality
short- term investments. Cash collateral requirements are determined daily based
on the prior business day's ending value of securities loaned. Imbalances in
cash collateral may occur on days where market volatility causes security prices
to change significantly, and are adjusted the next business day. Risks to the
Fund in securities-lending transactions are that the borrower may not provide
additional collateral when required or return the securities when due, and that
the value of the short-term investments will be less than the amount of cash
collateral required to be returned to the borrower. The aggregate fair market
value of the loaned portion of these securities as of April 30, 2010, was
approximately $50,028,000. This amount excludes $1,315,000 of securities on loan
which were sold prior to April 30, 2010.
E. 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.
F. NEW ACCOUNTING PRONOUNCEMENT - In January 2010, the Financial Accounting
Standards Board issued amended guidance for improving disclosures about fair
value measurements that adds new disclosure requirements about significant
transfers between Level 1, Level 2, and Level 3, and separate disclosures about
purchases, sales, issuances, and settlements in the reconciliation for fair
value measurements using significant unobservable inputs (Level 3). It also
clarifies existing disclosure requirements relating to the levels of
disaggregation for fair value measurement and inputs and valuation techniques
used to measure fair value. The amended guidance is effective for financial
statements for fiscal years and interim periods beginning after December 15,
2009, except for disclosures about purchases, sales, issuances and settlements
in the rollforward of activity in Level 3 fair value measurements, which are
effective for fiscal years beginning after December 15, 2010, and for interim
periods within those fiscal years. The Manager is in the process of evaluating
the impact of this guidance on the Fund's financial statement disclosures.
G. As of April 30, 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 depreciation of investments as of
April 30, 2010, were $71,773,000 and $13,730,000, respectively, resulting in net
unrealized appreciation of $58,043,000.
================================================================================
Notes to Portfolio of Investments | 12
<PAGE>
================================================================================
H. The portfolio of investments category percentages shown represent the
percentages of the investments to net assets, which were $684,083,000 at April
30, 2010, and, in total, may not equal 100%. A category percentage of 0.0%
represents less than 0.1% of net assets. Investments in foreign securities were
51.8% of net assets at April 30, 2010.
PORTFOLIO ABBREVIATIONS AND DESCRIPTIONS
ADR American depositary receipts are receipts issued by a U.S. bank evidencing
ownership of foreign shares. Dividends are paid in U.S. dollars.
GDR Global depositary receipts are receipts issued by a U.S. or foreign bank
evidencing ownership of foreign shares. Dividends are paid in U.S.
dollars.
SPECIFIC NOTES
(a) Security was fair valued at April 30, 2010, the Manager in accordance with
valuation procedures approved by the Trust's Board of Trustees.
(b) The security or a portion thereof was out on loan as of April 30, 2010.
(c) Rate represents the money market fund annualized seven-day yield at
April 30, 2010.
(d) Securities issued by government-sponsored enterprises 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.
(e) Zero-coupon security. Rate represents the effective yield at the date of
purchase.
* Non-income-producing security.
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13 | USAA Capital Growth Fund
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 April 30, 2010
By:* /s/ CHRISTOPHER P. LAIA
--------------------------------------------------------------
Signature and Title: Christopher P. Laia, Secretary
Date: 06/23/2010
-------------------------------
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: 06/23/2010
------------------------------
By:* /s/ ROBERTO GALINDO, JR.
-----------------------------------------------------
Signature and Title: Roberto Galindo, Jr., Treasurer
Date: 06/23/2010
------------------------------
*PRINT THE NAME AND TITLE OF EACH SIGNING OFFICER UNDER HIS OR HER SIGNATURE.
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