UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-22338
Legg Mason Global Asset Management Trust
(Exact name of registrant as specified in charter)
620 Eighth Avenue, 47th Floor, New York, NY 10018
(Address of principal executive offices) (Zip code)
Marc A. De Oliveira
Franklin Templeton
100 First Stamford Place
Stamford, CT 06902
(Name and address of agent for service)
Registrant’s telephone number, including area code: 1-877-721-1926
Date of fiscal year end: December 31
Date of reporting period: June 30, 2021
ITEM 1. | REPORT TO STOCKHOLDERS. |
The Semi-Annual Report to Stockholders is filed herewith.
Semi-Annual Report | June 30, 2021 |
BrandywineGLOBAL —
GLOBAL OPPORTUNITIES
BOND FUND (USD HEDGED)
The Fund intends to no longer mail paper copies of the Fund’s shareholder reports like this one, unless you specifically request paper copies of the reports from the Fund or from your Service Agent or financial intermediary (such as a broker-dealer or bank). Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically (“e-delivery”), you will not be affected by this change and you need not take any action. If you have not already elected e-delivery, you may elect to receive shareholder reports and other communications from the Fund electronically by contacting your Service Agent or, if you are a direct shareholder with the Fund, by calling 1-877-721-1926.
You may elect to receive all future reports in paper free of charge. If you invest through a Service Agent, you can contact your Service Agent to request that you continue to receive paper copies of your shareholder reports. That election will apply to all Legg Mason Funds held in your account at that Service Agent. If you are a direct shareholder with the Fund, you can call the Fund at 1-877-721-1926, or write to the Fund by regular mail at Legg Mason Funds, P.O. Box 9699, Providence, RI 02940-9699 or by express, certified or registered mail to Legg Mason Funds, 4400 Computer Drive, Westborough, MA 01581 to let the Fund know you wish to continue receiving paper copies of your shareholder reports. That election will apply to all Legg Mason Funds held in your account held directly with the fund complex.
INVESTMENT PRODUCTS: NOT FDIC INSURED • NO BANK GUARANTEE • MAY LOSE VALUE |
Fund objective
The Fund’s investment objective is to maximize total return consisting of income and capital appreciation.
Dear Shareholder,
We are pleased to provide the semi-annual report of BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) for the six-month reporting period ended June 30, 2021. Please read on for Fund performance information during the Fund’s reporting period.
As always, we remain committed to providing you with excellent service and a full spectrum of investment choices. We also remain committed to supplementing the support you receive from your financial advisor. One way we accomplish this is through our website, www.leggmason.com. Here you can gain immediate access to market and investment information, including:
• | Fund prices and performance, |
• | Market insights and commentaries from our portfolio managers, and |
• | A host of educational resources. |
We look forward to helping you meet your financial goals.
Sincerely,
Jane Trust, CFA
President and Chief Executive Officer
July 30, 2021
II | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) |
For the six months ended June 30, 2021, Class IS shares of BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) returned -0.75%. The Fund’s unmanaged benchmark, the FTSE World Government Bond Index (USD) (Hedged)i, returned -2.36% for the same period. The Lipper Global Income Funds Category Averageii returned -1.81% over the same time frame.
Performance Snapshot as of June 30, 2021 (unaudited) | ||||
6 months | ||||
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged): | ||||
Class I | -0.74 | % | ||
Class IS | -0.75 | % | ||
FTSE World Government Bond Index (USD) (Hedged) | -2.36 | % | ||
Lipper Global Income Funds Category Average | -1.81 | % |
The performance shown represents past performance. Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown above. Principal value, investment returns and yields will fluctuate and investors’ shares, when redeemed, may be worth more or less than their original cost. To obtain performance data current to the most recent month-end, please visit our website at www.leggmason.com/mutualfunds.
All share class returns assume the reinvestment of all distributions including returns of capital, if any, at net asset value and the deduction of all Fund expenses. Returns have not been adjusted to include the deduction of taxes that a shareholder would pay on Fund distributions. Performance figures for periods shorter than one year represent cumulative figures and are not annualized.
Fund performance figures reflect fee waivers and/or expense reimbursements, without which the performance would have been lower.
The 30-Day SEC Yields for the period ended June 30, 2021 for Class I and Class IS shares were 1.85% and 1.94%, respectively. Absent fee waivers and/or expense reimbursements, the 30-Day SEC Yield for Class I shares would have been 1.83%. The 30-Day SEC Yield, calculated pursuant to the standard SEC formula, is based on the Fund’s investments over an annualized trailing 30-day period, and not on the distributions paid by the Fund, which may differ.
Performance of Class A and Class C shares is not shown because the inception date for these share classes was January 19, 2021.
Total Annual Operating Expenses (unaudited) |
As of the Fund’s current prospectus dated May 1, 2021, the gross total annual fund operating expense ratios for Class I and Class IS shares were 0.74% and 0.62%, respectively.
Actual expenses may be higher. For example, expenses may be higher than those shown if average net assets decrease. Net assets are more likely to decrease and Fund expense ratios are more likely to increase when markets are volatile.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) |
III |
Performance review (cont’d)
As always, thank you for your confidence in our stewardship of your assets.
Sincerely,
Jane Trust, CFA
President and Chief Executive Officer
July 30, 2021
RISKS: Fixed income securities involve interest rate, credit, inflation, and reinvestment risks, and possible loss of principal. As interest rates rise, the value of fixed income securities falls. Asset-backed, mortgage-backed or mortgage-related securities are subject to prepayment and extension risks. High yield bonds are subject to greater price volatility, illiquidity, and possibility of default. International investments are subject to special risks, including currency fluctuations and social, economic, and political uncertainties, which could increase volatility. These risks are magnified in emerging markets. Derivatives, such as options and futures, can be illiquid, may disproportionately increase losses, and have a potentially large impact on Fund performance. Derivative investments may be significant at times. While hedging can reduce or eliminate losses, it can also reduce or eliminate gains. There can be no assurance that the Fund’s hedging transactions will be effective. As a non-diversified fund, the Fund may invest a larger percentage of its assets in a smaller number of issuers than a diversified fund, which may magnify the Fund’s losses from events affecting a particular issuer. Leverage may increase volatility and possibility of loss. Active management does not ensure gains or protect against market declines. Please see the Fund’s prospectus for a more complete discussion of these and other risks and the Fund’s investment strategies.
All investments are subject to risk including the possible loss of principal. Past performance is no guarantee of future results. All index performance reflects no deduction for fees, expenses, or taxes. Please note that an investor cannot invest directly in an index.
i | The FTSE World Government Bond Index (USD) (Hedged) measures the performance of developed countries’ global fixed income markets invested in debt issues of U.S. and non-U.S. governmental entities hedged in the U.S. Dollar. |
ii | Lipper, Inc., a wholly-owned subsidiary of Refinitiv, provides independent insight on global collective investments. Returns are based on the six-month period ended June 30, 2021, including the reinvestment of all distributions, including returns of capital, if any, calculated among the 212 funds in the Fund’s Lipper category and excluding sales charges, if any. |
IV | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) |
Investment breakdown (%) as a percent of total investments
† | The bar graph above represents the composition of the Fund’s investments as of June 30, 2021 and December 31, 2020 and does not include derivatives, such as futures contracts and forward foreign currency contracts. The Fund is actively managed. As a result, the composition of the Fund’s investments is subject to change at any time. |
‡ | Represents less than 0.1% |
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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1 |
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Example
As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including front-end and back-end sales charges (loads) on purchase payments; and (2) ongoing costs, including management fees; service and/or distribution (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
This example is based on an investment of $1,000 invested on January 1, 2021 and held for the six months ended June 30, 2021.
Actual expenses
The table below titled “Based on Actual Total Return” provides information about actual account values and actual expenses. You may use the information provided in this table, together with the amount you invested, to estimate the expenses that you paid over the period. To estimate the expenses you paid on your account, divide your ending account value by $1,000 (for example, an $8,600 ending account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During the Period”.
Based on actual total return1 | Based on hypothetical total return1 | |||||||||||||||||||||||||||||||||||||||||||||
Actual Total Return2 | Beginning Account Value | Ending Account Value | Annualized Expense Ratio | Expenses Paid During the Period | Hypothetical Annualized Total Return | Beginning Account Value | Ending Account Value | Annualized Expense Ratio | Expenses Paid During the Period5 | |||||||||||||||||||||||||||||||||||||
Class A3 | -0.64 | % | $ | 1,000.00 | $ | 993.60 | 0.93 | % | $ | 4.11 | 4 | Class A | 5.00 | % | $ | 1,000.00 | $ | 1,020.18 | 0.93 | % | $ | 4.66 | ||||||||||||||||||||||||
Class C3 | -0.87 | 1,000.00 | 991.30 | 1.75 | 7.73 | 4 | Class C | 5.00 | 1,000.00 | 1,016.12 | 1.75 | 8.75 | ||||||||||||||||||||||||||||||||||
Class I | -0.74 | 1,000.00 | 992.60 | 0.75 | 3.71 | 5 | Class I | 5.00 | 1,000.00 | 1,021.08 | 0.75 | 3.76 | ||||||||||||||||||||||||||||||||||
Class IS | -0.75 | 1,000.00 | 992.50 | 0.60 | 2.96 | 5 | Class IS | 5.00 | 1,000.00 | 1,021.82 | 0.60 | 3.01 |
Hypothetical example for comparison purposes
The table below titled “Based on Hypothetical Total Return” provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio and an assumed rate of return of 5.00% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use the information provided in this table to compare the ongoing costs of investing in the Fund and other funds. To do so, compare the 5.00% hypothetical example relating to the Fund with the 5.00% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table below are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, 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 transaction costs were included, your costs would have been higher.
2 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
1 | For the six months ended June 30, 2021. |
2 | Assumes the reinvestment of all distributions, including returns of capital, if any, at net asset value and does not reflect the deduction of the applicable sales charge with respect to Class A shares or the applicable contingent deferred sales charge (“CDSC”) with respect to Class C shares. Total return is not annualized, as it may not be representative of the total return for the year. Performance figures may reflect compensating balance arrangements, fee waivers and/or expense reimbursements. In the absence of compensating balance arrangements, fee waivers and/or expense reimbursements, the total return would have been lower. Past performance is no guarantee of future results. |
3 | For the period January 20, 2021 (inception date) to June 30, 2021 (unaudited). |
4 | Expenses (net of compensating balance arrangements, fee waivers and/or expense reimbursements) are equal to each class’ respective annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half-year (162), then divided by 365. |
5 | Expenses (net of compensating balance arrangements, fee waivers and/or expense reimbursements) are equal to each class’ respective annualized expense ratio multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half-year (181), then divided by 365. |
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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3 |
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Schedule of investments (unaudited)
June 30, 2021
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged)
Security | Rate | Maturity Date | Face Amount† | Value | ||||||||||||
U.S. Government & Agency Obligations — 42.7% |
| |||||||||||||||
U.S. Government Obligations — 42.7% |
| |||||||||||||||
U.S. Treasury Notes (3 mo. U.S. Treasury Money Market Yield + 0.114%) | 0.164 | % | 4/30/22 | 60,290,000 | $ | 60,350,881 | (a) | |||||||||
U.S. Treasury Notes (3 mo. U.S. Treasury Money Market Yield + 0.055%) | 0.105 | % | 7/31/22 | 40,415,000 | 40,441,897 | (a) | ||||||||||
U.S. Treasury Notes (3 mo. U.S. Treasury Money Market Yield + 0.055%) | 0.105 | % | 10/31/22 | 28,850,000 | 28,869,758 | (a) | ||||||||||
U.S. Treasury Notes (3 mo. U.S. Treasury Money Market Yield + 0.049%) | 0.099 | % | 1/31/23 | 61,525,000 | 61,556,501 | (a) | ||||||||||
Total U.S. Government & Agency Obligations (Cost — $191,112,251) |
| 191,219,037 | ||||||||||||||
Sovereign Bonds — 35.0% | ||||||||||||||||
Australia — 4.6% | ||||||||||||||||
Australia Government Bond | 5.750 | % | 7/15/22 | 11,860,000 | AUD | 9,425,761 | (b) | |||||||||
New South Wales Treasury Corp. | 4.000 | % | 4/20/23 | 2,660,000 | AUD | 2,135,150 | ||||||||||
Queensland Treasury Corp. | 4.250 | % | 7/21/23 | 5,160,000 | AUD | 4,193,753 | (b) | |||||||||
Western Australian Treasury Corp. | 6.000 | % | 10/16/23 | 5,430,000 | AUD | 4,615,597 | ||||||||||
Total Australia | 20,370,261 | |||||||||||||||
Brazil — 3.1% | ||||||||||||||||
Brazil Notas do Tesouro Nacional Serie F, Notes | 10.000 | % | 1/1/27 | 51,060,000 | BRL | 10,888,157 | ||||||||||
Brazil Notas do Tesouro Nacional Serie F, Notes | 10.000 | % | 1/1/29 | 14,520,000 | BRL | 3,107,683 | ||||||||||
Total Brazil | 13,995,840 | |||||||||||||||
China — 2.8% | ||||||||||||||||
China Government Bond, Senior Notes | 3.810 | % | 9/14/50 | 79,430,000 | CNY | 12,618,373 | ||||||||||
Colombia — 3.5% | ||||||||||||||||
Colombian TES, Bonds | 6.250 | % | 11/26/25 | 22,500,000,000 | COP | 6,082,245 | ||||||||||
Colombian TES, Bonds | 6.000 | % | 4/28/28 | 37,300,000,000 | COP | 9,551,559 | ||||||||||
Total Colombia | 15,633,804 | |||||||||||||||
Indonesia — 3.3% | ||||||||||||||||
Indonesia Treasury Bond | 9.000 | % | 3/15/29 | 186,520,000,000 | IDR | 14,921,600 | ||||||||||
Malaysia — 2.6% | ||||||||||||||||
Malaysia Government Bond | 3.882 | % | 3/10/22 | 22,950,000 | MYR | 5,607,182 | ||||||||||
Malaysia Government Bond | 3.955 | % | 9/15/25 | 8,050,000 | MYR | 2,047,411 | ||||||||||
Malaysia Government Bond | 3.899 | % | 11/16/27 | 16,090,000 | MYR | 4,085,541 | ||||||||||
Total Malaysia | 11,740,134 | |||||||||||||||
Mexico — 9.1% | ||||||||||||||||
Mexican Bonos, Bonds | 8.000 | % | 11/7/47 | 85,400,000 | MXN | 4,522,975 | ||||||||||
Mexican Bonos, Senior Notes | 8.500 | % | 5/31/29 | 198,100,000 | MXN | 10,945,446 |
See Notes to Financial Statements.
4 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged)
Security | Rate | Maturity Date | Face Amount† | Value | ||||||||||||
Mexico — continued | ||||||||||||||||
Mexican Bonos, Senior Notes | 8.500 | % | 11/18/38 | 210,300,000 | MXN | $ | 11,667,368 | |||||||||
Mexican Bonos, Senior Notes | 7.750 | % | 11/13/42 | 263,700,000 | MXN | 13,610,472 | ||||||||||
Total Mexico | 40,746,261 | |||||||||||||||
Poland — 0.4% | ||||||||||||||||
Republic of Poland Government Bond | 4.000 | % | 10/25/23 | 5,640,000 | PLN | 1,601,432 | ||||||||||
Russia — 0.5% | ||||||||||||||||
Russian Federal Bond — OFZ | 7.650 | % | 4/10/30 | 137,000,000 | RUB | 1,950,449 | ||||||||||
South Africa — 5.1% | ||||||||||||||||
Republic of South Africa Government Bond, Senior Notes | 6.500 | % | 2/28/41 | 195,500,000 | ZAR | 9,211,637 | ||||||||||
Republic of South Africa Government Bond, Senior Notes | 8.750 | % | 2/28/48 | 231,200,000 | ZAR | 13,723,857 | ||||||||||
Total South Africa | 22,935,494 | |||||||||||||||
Total Sovereign Bonds (Cost — $155,324,384) |
| 156,513,648 | ||||||||||||||
Corporate Bonds & Notes — 18.5% | ||||||||||||||||
Consumer Discretionary — 2.4% | ||||||||||||||||
Automobiles — 2.4% | ||||||||||||||||
General Motors Co., Senior Notes | 6.800 | % | 10/1/27 | 1,180,000 | 1,487,217 | |||||||||||
General Motors Co., Senior Notes | 6.250 | % | 10/2/43 | 2,000,000 | 2,765,243 | |||||||||||
General Motors Financial Co. Inc., Senior Notes (SOFR + 1.200%) | 1.235 | % | 11/17/23 | 6,210,000 | 6,314,142 | (a) | ||||||||||
Total Consumer Discretionary | 10,566,602 | |||||||||||||||
Energy — 5.8% | �� | |||||||||||||||
Oil, Gas & Consumable Fuels — 5.8% | ||||||||||||||||
Apache Corp., Senior Notes | 4.750 | % | 4/15/43 | 2,755,000 | 2,870,448 | |||||||||||
Apache Corp., Senior Notes | 4.250 | % | 1/15/44 | 845,000 | 828,996 | |||||||||||
Apache Corp., Senior Notes | 5.350 | % | 7/1/49 | 890,000 | 937,935 | |||||||||||
Exxon Mobil Corp., Senior Notes | 3.452 | % | 4/15/51 | 2,760,000 | 3,010,181 | |||||||||||
Hess Corp., Senior Notes | 5.600 | % | 2/15/41 | 1,265,000 | 1,581,254 | |||||||||||
Hess Corp., Senior Notes | 5.800 | % | 4/1/47 | 1,575,000 | 2,060,398 | |||||||||||
Occidental Petroleum Corp., Senior Notes | 6.200 | % | 3/15/40 | 570,000 | 645,730 | |||||||||||
Occidental Petroleum Corp., Senior Notes | 6.600 | % | 3/15/46 | 875,000 | 1,041,915 | |||||||||||
Occidental Petroleum Corp., Senior Notes | 4.400 | % | 4/15/46 | 2,510,000 | 2,414,005 | |||||||||||
Occidental Petroleum Corp., Senior Notes | 4.200 | % | 3/15/48 | 2,315,000 | 2,167,523 | |||||||||||
Occidental Petroleum Corp., Senior Notes | 4.400 | % | 8/15/49 | 1,150,000 | 1,105,558 | |||||||||||
Petroleos Mexicanos, Senior Notes | 6.750 | % | 9/21/47 | 1,110,000 | 983,749 | |||||||||||
Petroleos Mexicanos, Senior Notes | 7.690 | % | 1/23/50 | 6,200,000 | 5,975,250 | |||||||||||
Saudi Arabian Oil Co., Senior Notes | 3.250 | % | 11/24/50 | 500,000 | 487,187 | (c) | ||||||||||
Total Energy | 26,110,129 |
See Notes to Financial Statements.
BrandywineGLOBAL - Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
5 |
Schedule of investments (unaudited) (cont’d)
June 30, 2021
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged)
Security | Rate | Maturity Date | Face Amount† | Value | ||||||||||||
Financials — 7.1% | ||||||||||||||||
Banks — 3.5% | ||||||||||||||||
Bank of Montreal, Senior Notes (SOFR + 0.680%) | 0.726 | % | 3/10/23 | 3,515,000 | $ | 3,548,340 | (a) | |||||||||
Bank of Nova Scotia, Senior Notes (SOFR + 0.550%) | 0.597 | % | 9/15/23 | 8,875,000 | 8,943,286 | (a) | ||||||||||
Canadian Imperial Bank of Commerce, Senior Notes (SOFR + 0.800%) | 0.850 | % | 3/17/23 | 3,030,000 | 3,060,786 | (a) | ||||||||||
Total Banks | 15,552,412 | |||||||||||||||
Capital Markets — 1.1% | ||||||||||||||||
Goldman Sachs Group Inc., Senior Notes (3 mo. USD LIBOR + 0.750%) | 0.900 | % | 2/23/23 | 5,158,000 | 5,205,777 | (a) | ||||||||||
Consumer Finance — 0.4% | ||||||||||||||||
American Express Co., Senior Notes (3 mo. USD LIBOR + 0.600%) | 0.776 | % | 11/5/21 | 1,842,000 | 1,844,844 | (a) | ||||||||||
Insurance — 2.1% | ||||||||||||||||
Athene Global Funding, Senior Notes (SOFR + 0.700%) | 0.739 | % | 5/24/24 | 7,110,000 | 7,170,933 | (a)(c) | ||||||||||
Metropolitan Life Global Funding I, Secured Notes (SOFR + 0.570%) | 0.590 | % | 1/13/23 | 2,070,000 | 2,082,697 | (a)(c) | ||||||||||
Total Insurance | 9,253,630 | |||||||||||||||
Total Financials | 31,856,663 | |||||||||||||||
Industrials — 3.2% | ||||||||||||||||
Aerospace & Defense — 2.0% | ||||||||||||||||
Boeing Co., Senior Notes | 5.705 | % | 5/1/40 | 975,000 | 1,257,525 | |||||||||||
Boeing Co., Senior Notes | 5.805 | % | 5/1/50 | 2,815,000 | 3,796,988 | |||||||||||
Boeing Co., Senior Notes | 3.950 | % | 8/1/59 | 1,645,000 | 1,725,810 | |||||||||||
Boeing Co., Senior Notes | 5.930 | % | 5/1/60 | 1,630,000 | 2,255,058 | |||||||||||
Total Aerospace & Defense | 9,035,381 | |||||||||||||||
Machinery — 1.2% | ||||||||||||||||
Caterpillar Financial Services Corp., Senior Notes (SOFR + 0.150%) | 0.185 | % | 11/17/22 | 5,465,000 | 5,466,912 | (a) | ||||||||||
Total Industrials | 14,502,293 | |||||||||||||||
Total Corporate Bonds & Notes (Cost — $77,426,817) |
| 83,035,687 | ||||||||||||||
Collateralized Mortgage Obligations (d) —0.6% |
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Benchmark Mortgage Trust, 2020-B17 A2 | 2.211 | % | 3/15/53 | 400,000 | 414,154 | |||||||||||
BX Commercial Mortgage Trust, 2019-XL A (1 mo. USD LIBOR + 0.920%) | 0.993 | % | 10/15/36 | 334,948 | 335,767 | (a)(c) | ||||||||||
Commercial Mortgage Trust, 2015-3BP A | 3.178 | % | 2/10/35 | 220,000 | 234,926 | (c) | ||||||||||
CSMC Trust, 2019-ICE4 A (1 mo. USD LIBOR + 0.980%) | 1.053 | % | 5/15/36 | 195,000 | 195,781 | (a)(c) |
See Notes to Financial Statements.
6 | BrandywineGLOBAL - Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged)
Security | Rate | Maturity Date | Face Amount† | Value | ||||||||||||
Collateralized Mortgage Obligations (d) — continued |
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Federal Home Loan Mortgage Corp. (FHLMC) Structured Agency Credit Risk Debt Notes, 2018-HRP1 M2 (1 mo. USD LIBOR + 1.650%) | 1.742 | % | 4/25/43 | 657,155 | $ | 658,295 | (a)(c) | |||||||||
Federal National Mortgage Association (FNMA) — CAS, 2014-C04 1M2 (1 mo. USD LIBOR + 4.900%) | 4.992 | % | 11/25/24 | 64,219 | 66,479 | (a) | ||||||||||
Federal National Mortgage Association (FNMA) — CAS, 2017-C05 1M2 (1 mo. USD LIBOR + 2.200%) | 2.292 | % | 1/25/30 | 280,584 | 285,351 | (a) | ||||||||||
IM Pastor Fondo de Titulizacion de Activos, 4 A (3 mo. EURIBOR + 0.140%, 0.000% floor) | 0.000 | % | 3/22/44 | | 295,327 | EUR | 325,802 | (a)(b) | ||||||||
Total Collateralized Mortgage Obligations (Cost — $2,458,256) |
| 2,516,555 | ||||||||||||||
Asset-Backed Securities — 0.0%†† | ||||||||||||||||
Towd Point Mortgage Trust, 2017-6 A2 (Cost — $194,215) | 3.000 | % | 10/25/57 | 200,000 | 211,082 | (a)(c) | ||||||||||
Total Investments before Short-Term Investments (Cost — $426,515,923) |
| 433,496,009 | ||||||||||||||
Shares | ||||||||||||||||
Short-Term Investments — 2.7% | ||||||||||||||||
Western Asset Premier Institutional U.S. Treasury Reserves, Premium Shares | 0.010 | % | 11,784,319 | 11,784,319 | (e) | |||||||||||
Total Investments — 99.5% (Cost — $438,300,242) |
| 445,280,328 | ||||||||||||||
Other Assets in Excess of Liabilities — 0.5% | 2,449,607 | |||||||||||||||
Total Net Assets — 100.0% | $ | 447,729,935 |
See Notes to Financial Statements.
BrandywineGLOBAL - Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
7 |
Schedule of investments (unaudited) (cont’d)
june 30,2021
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged)
† | Face amount denominated in U.S. dollars, unless otherwise noted. |
†† | Represents less than 0.1%. |
(a) | Variable rate security. Interest rate disclosed is as of the most recent information available. Certain variable rate securities are not based on a published reference rate and spread but are determined by the issuer or agent and are based on current market conditions. These securities do not indicate a reference rate and spread in their description above. |
(b) | Security is exempt from registration under Regulation S of the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States. This security has been deemed liquid pursuant to guidelines approved by the Board of Trustees. |
(c) | Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. This security has been deemed liquid pursuant to guidelines approved by the Board of Trustees. |
(d) | Collateralized mortgage obligations are secured by an underlying pool of mortgages or mortgage pass-through certificates that are structured to direct payments on underlying collateral to different series or classes of the obligations. The interest rate may change positively or inversely in relation to one or more interest rates, financial indices or other financial indicators and may be subject to an upper and/or lower limit. |
(e) | In this instance, as defined in the Investment Company Act of 1940, an “Affiliated Company” represents Fund ownership of at least 5% of the outstanding voting securities of an issuer, or a company which is under common ownership or control with the Fund. At June 30, 2021, the total market value of investments in Affiliated Companies was $11,784,319 and the cost was $11,784,319 (Note 8). |
Abbreviation(s) used in this schedule: | ||
AUD | — Australian Dollar | |
BRL | — Brazilian Real | |
CAS | — Connecticut Avenue Securities | |
CNY | — Chinese Yuan Renminbi | |
COP | — Colombian Peso | |
EUR | — Euro | |
EURIBOR | — Euro Interbank Offered Rate | |
IDR | — Indonesian Rupiah | |
LIBOR | — London Interbank Offered Rate | |
MXN | — Mexican Peso | |
MYR | — Malaysian Ringgit | |
OFZ | — Obligatsyi Federal’novo Zaima (Russian Federal Loan Obligation) | |
PLN | — Polish Zloty | |
RUB | — Russian Ruble | |
SOFR | — Secured Overnight Financing Rate | |
USD | — United States Dollar | |
ZAR | — South African Rand |
See Notes to Financial Statements.
8 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged)
At June 30, 2021, the Fund had the following open futures contracts:
Number of Contracts | Expiration Date | Notional Amount | Market Value | Unrealized Depreciation | ||||||||||||||||||||
Contracts to Sell: | ||||||||||||||||||||||||
U.S. Treasury Ultra Long-Term Bonds | 129 | 9/21 | $ | 23,969,684 | $ | 24,856,688 | $ | (887,004) |
At June 30, 2021, the Fund had the following open forward foreign currency contracts:
Currency Purchased | Currency Sold | Counterparty | Settlement Date | Unrealized Appreciation (Depreciation) | ||||||||||||||||
EUR | 1,690,000 | USD | 2,049,970 | Citibank N.A. | 7/12/21 | $ | (45,544) | |||||||||||||
USD | 21,890,756 | EUR | 18,400,000 | Citibank N.A. | 7/12/21 | 67,421 | ||||||||||||||
EUR | 2,110,000 | USD | 2,581,880 | JPMorgan Chase & Co. | 7/12/21 | (79,313) | ||||||||||||||
PLN | 7,120,000 | USD | 1,850,071 | Citibank N.A. | 7/13/21 | 17,364 | ||||||||||||||
THB | 5,400,000 | USD | 173,745 | HSBC Securities Inc. | 7/13/21 | (5,266) | ||||||||||||||
USD | 9,706,836 | BRL | 54,500,000 | HSBC Securities Inc. | 7/14/21 | (1,233,768) | ||||||||||||||
USD | 9,281,669 | MYR | 38,350,000 | Barclays Bank PLC | 7/15/21 | 49,974 | ||||||||||||||
NZD | 1,840,000 | USD | 1,316,511 | HSBC Securities Inc. | 7/19/21 | (30,388) | ||||||||||||||
USD | 596,189 | NZD | 830,000 | HSBC Securities Inc. | 7/19/21 | 16,036 | ||||||||||||||
USD | 720,527 | NZD | 1,010,000 | HSBC Securities Inc. | 7/19/21 | 14,557 | ||||||||||||||
PLN | 9,620,000 | USD | 2,525,465 | JPMorgan Chase & Co. | 7/20/21 | (2,247) | ||||||||||||||
CLP | 740,000,000 | USD | 1,046,055 | HSBC Securities Inc. | 7/23/21 | (38,989) | ||||||||||||||
EUR | 3,060,000 | USD | 3,648,071 | Barclays Bank PLC | 7/26/21 | (17,720) | ||||||||||||||
USD | 1,156,017 | EUR | 970,000 | Citibank N.A. | 7/26/21 | 5,219 | ||||||||||||||
USD | 2,484,571 | EUR | 2,090,000 | Citibank N.A. | 7/26/21 | 5,018 | ||||||||||||||
USD | 1,862,557 | IDR | 26,900,000,000 | JPMorgan Chase & Co. | 7/28/21 | 11,424 | ||||||||||||||
USD | 12,333,039 | IDR | 181,530,000,000 | JPMorgan Chase & Co. | 7/28/21 | (159,015) | ||||||||||||||
KRW | 3,160,000,000 | USD | 2,826,678 | Citibank N.A. | 7/29/21 | (21,127) | ||||||||||||||
USD | 1,074,871 | KRW | 1,220,000,000 | Citibank N.A. | 7/29/21 | (8,285) | ||||||||||||||
USD | 1,708,885 | KRW | 1,940,000,000 | Citibank N.A. | 7/29/21 | (13,510) | ||||||||||||||
COP | 3,130,000,000 | USD | 845,261 | JPMorgan Chase & Co. | 7/29/21 | (12,403) | ||||||||||||||
USD | 14,508,895 | COP | 52,565,000,000 | JPMorgan Chase & Co. | 7/29/21 | 521,941 | ||||||||||||||
CLP | 830,000,000 | USD | 1,162,123 | HSBC Securities Inc. | 8/6/21 | (32,967) | ||||||||||||||
THB | 7,500,000 | USD | 240,077 | HSBC Securities Inc. | 8/6/21 | (6,097) | ||||||||||||||
HUF | 730,000,000 | USD | 2,434,754 | HSBC Securities Inc. | 8/10/21 | 27,102 | ||||||||||||||
USD | 35,597,598 | MXN | 718,000,000 | Citibank N.A. | 8/13/21 | (227,510) | ||||||||||||||
USD | 697,651 | MXN | 14,000,000 | Goldman Sachs Group Inc. | 8/13/21 | (889) | ||||||||||||||
THB | 7,600,000 | USD | 243,317 | HSBC Securities Inc. | 8/13/21 | (6,225) | ||||||||||||||
USD | 1,150,472 | CAD | 1,390,000 | Goldman Sachs Group Inc. | 8/16/21 | 29,170 | ||||||||||||||
USD | 1,764,004 | ZAR | 25,000,000 | Citibank N.A. | 8/17/21 | 23,732 | ||||||||||||||
USD | 3,875,550 | CNY | 25,100,000 | HSBC Securities Inc. | 8/17/21 | 3,336 | ||||||||||||||
USD | 4,044,169 | CNY | 26,260,000 | HSBC Securities Inc. | 8/17/21 | (7,001) | ||||||||||||||
See Notes to Financial Statements.
BrandywineGLOBAL - Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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9 |
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Schedule of investments (unaudited) (cont’d)
June 30, 2021
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged)
Currency Purchased | Currency Sold | Counterparty | Settlement Date | Unrealized (Depreciation) | ||||||||||||||||
USD | 4,230,917 | CNY | 27,520,000 | HSBC Securities Inc. | 8/17/21 | $ | (14,634) | |||||||||||||
USD | 20,638,913 | ZAR | 297,900,000 | HSBC Securities Inc. | 8/17/21 | (98,177) | ||||||||||||||
USD | 11,432,983 | JPY | 1,247,000,000 | Citibank N.A. | 8/24/21 | 203,303 | ||||||||||||||
USD | 485,686 | AUD | 630,000 | HSBC Securities Inc. | 8/25/21 | 13,101 | ||||||||||||||
USD | 22,099,222 | AUD | 28,380,000 | JPMorgan Chase & Co. | 8/25/21 | 810,405 | ||||||||||||||
RUB | 48,000,000 | USD | 641,454 | Citibank N.A. | 8/26/21 | 9,348 | ||||||||||||||
CLP | 880,000,000 | USD | 1,257,924 | HSBC Securities Inc. | 9/3/21 | (61,687) | ||||||||||||||
KRW | 600,000,000 | USD | 538,532 | HSBC Securities Inc. | 9/13/21 | (5,895) | ||||||||||||||
USD | 528,571 | KRW | 600,000,000 | HSBC Securities Inc. | 9/13/21 | (4,065) | ||||||||||||||
CLP | 730,000,000 | USD | 1,012,814 | HSBC Securities Inc. | 10/1/21 | (21,372) | ||||||||||||||
CLP | 1640,000,000 | USD | 2,266,038 | HSBC Securities Inc. | 10/8/21 | (39,350) | ||||||||||||||
Total | $ | (364,993) |
Abbreviation(s) used in this table: | ||
AUD | — Australian Dollar | |
BRL | — Brazilian Real | |
CAD | — Canadian Dollar | |
CLP | — Chilean Peso | |
CNY | — Chinese Yuan Renminbi | |
COP | — Colombian Peso | |
EUR | — Euro | |
HUF | — Hungarian Forint | |
IDR | — Indonesian Rupiah | |
JPY | — Japanese Yen | |
KRW | — South Korean Won | |
MXN | — Mexican Peso | |
MYR | — Malaysian Ringgit | |
NZD | — New Zealand Dollar | |
PLN | — Polish Zloty | |
RUB | — Russian Ruble | |
THB | — Thai Baht | |
USD | — United States Dollar | |
ZAR | — South African Rand |
See Notes to Financial Statements.
10 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged)
Summary of Investments by Country* | ||||
United States | 57.0 | % | ||
Mexico | 10.7 | |||
South Africa | 5.2 | |||
Australia | 4.6 | |||
Colombia | 3.5 | |||
Canada | 3.5 | |||
Indonesia | 3.4 | |||
Brazil | 3.1 | |||
China | 2.8 | |||
Malaysia | 2.6 | |||
Russia | 0.4 | |||
Poland | 0.4 | |||
Saudi Arabia | 0.1 | |||
Spain | 0.1 | |||
Short-Term Investments | 2.6 | |||
100.0 | % |
* | As a percentage of total investments. Please note that the Fund holdings are as of June 30, 2021 and are subject to change. For purposes of the Fund’s policy to invest at least 80% of its net assets in fixed income securities of issuers located in developed market countries, a country will be considered developed if, at the time of purchase, it has a sovereign debt rating of A- or better from at least one nationally recognized statistical ratings organization or is included in the FTSE World Government Bond Index. |
See Notes to Financial Statements.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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|
Statement of assets and liabilities (unaudited)
June 30, 2021
Assets: | ||||
Investments in unaffiliated securities, at value (Cost — $426,515,923) | $ | 433,496,009 | ||
Investments in affiliated securities, at value (Cost — $11,784,319) | 11,784,319 | |||
Foreign currency, at value (Cost — $78,290) | 78,017 | |||
Interest receivable | 3,629,339 | |||
Unrealized appreciation on forward foreign currency contracts | 1,828,451 | |||
Deposits with brokers for OTC derivatives | 1,450,000 | |||
Deposits with brokers for open futures contracts | 998,360 | |||
Receivable for Fund shares sold | 67,082 | |||
Prepaid expenses | 46,172 | |||
Total Assets | 453,377,749 | |||
Liabilities: | ||||
Payable for securities purchased | 2,411,459 | |||
Unrealized depreciation on forward foreign currency contracts | 2,193,444 | |||
Deposits from brokers for OTC derivatives | 450,000 | |||
Investment management fee payable | 191,492 | |||
Payable to broker — net variation margin on open futures contracts | 145,125 | |||
Accrued foreign capital gains tax | 67,625 | |||
Payable for Fund shares repurchased | 59,723 | |||
Distributions payable | 30,499 | |||
Trustees’ fees payable | 9,837 | |||
Service and/or distribution fees payable | 24 | |||
Accrued expenses | 88,586 | |||
Total Liabilities | 5,647,814 | |||
Total Net Assets | $ | 447,729,935 | ||
Net Assets: | ||||
Par value (Note 7) | $ | 426 | ||
Paid-in capital in excess of par value | 439,971,780 | |||
Total distributable earnings (loss) | 7,757,729 | |||
Total Net Assets | $ | 447,729,935 |
See Notes to Financial Statements.
12 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
Net Assets: | ||||
Class A | $58,492 | |||
Class C | $14,952 | |||
Class I | $84,402 | |||
Class IS | $447,572,089 | |||
Shares Outstanding: | ||||
Class A | 5,574 | |||
Class C | 1,426 | |||
Class I | 8,041 | |||
Class IS | 42,620,473 | |||
Net Asset Value: | ||||
Class A (and redemption price) | $10.49 | |||
Class C | $10.49 | |||
Class I (and redemption price) | $10.50 | |||
Class IS (and redemption price) | $10.50 | |||
Maximum Public Offering Price Per Share: | ||||
Class A (based on maximum initial sales charge of 4.25%) | $10.96 |
See Notes to Financial Statements.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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13 |
|
Statement of operations (unaudited)
For the Six Months Ended June 30, 2021
Investment Income: | ||||
Interest from unaffiliated investments | $ | 6,123,497 | ||
Interest from affiliated investments | 90 | |||
Less: Foreign taxes withheld | (162,091) | |||
Total Investment Income | 5,961,496 | |||
Expenses: | ||||
Investment management fee (Note 2) | 1,084,361 | |||
Custody fees | 44,218 | |||
Registration fees | 36,547 | |||
Fund accounting fees | 35,870 | |||
Audit and tax fees | 32,608 | |||
Trustees’ fees | 24,407 | |||
Legal fees | 17,295 | |||
Commitment fees (Note 9) | 5,486 | |||
Insurance | 2,792 | |||
Shareholder reports | 2,767 | |||
Transfer agent fees (Note 5) | 197 | |||
Service and/or distribution fees (Notes 2 and 5) | 62 | |||
Miscellaneous expenses | 8,054 | |||
Total Expenses | 1,294,664 | |||
Less: Fee waivers and/or expense reimbursements (Notes 2 and 5) | (23) | |||
Net Expenses | 1,294,641 | |||
Net Investment Income | 4,666,855 | |||
Realized and Unrealized Gain (Loss) on Investments, Futures Contracts, Forward Foreign Currency Contracts and Foreign Currency Transactions (Notes 1, 3 and 4): | ||||
Net Realized Gain (Loss) From: | ||||
Investment transactions in unaffiliated securities | 4,081,862 | † | ||
Futures contracts | 4,736,874 | |||
Forward foreign currency contracts | (7,040,036) | |||
Foreign currency transactions | 35,383 | |||
Net Realized Gain | 1,814,083 | |||
Change in Net Unrealized Appreciation (Depreciation) From: | ||||
Investments in unaffiliated securities | (16,246,262) | ‡ | ||
Futures contracts | (1,147,396) | |||
Forward foreign currency contracts | 8,057,580 | |||
Foreign currencies | (85,504) | |||
Change in Net Unrealized Appreciation (Depreciation) | (9,421,582) | |||
Net Loss on Investments, Futures Contracts, Forward Foreign Currency Contracts and Foreign Currency Transactions | (7,607,499) | |||
Decrease in Net Assets From Operations | $ | (2,940,644) |
† | Net of foreign capital gains tax of $55. |
‡ | Net of change in accrued foreign capital gains tax of $(63,565). |
See Notes to Financial Statements.
14 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
Statements of changes in net assets
For the Six Months Ended June 30, 2021 (unaudited) and the Year Ended December 31, 2020 | 2021 | 2020 | ||||||
Operations: | ||||||||
Net investment income | $ | 4,666,855 | $ | 7,865,336 | ||||
Net realized gain | 1,814,083 | 15,810,453 | ||||||
Change in net unrealized appreciation (depreciation) | (9,421,582) | 11,789,305 | ||||||
Increase (Decrease) in Net Assets From Operations | (2,940,644) | 35,465,094 | ||||||
Distributions to Shareholders From (Notes 1 and 6): | ||||||||
Total distributable earnings | (4,590,101) | (23,861,170) | ||||||
Decrease in Net Assets From Distributions to Shareholders | (4,590,101) | (23,861,170) | ||||||
Fund Share Transactions (Note 7): | ||||||||
Net proceeds from sale of shares | 31,814,539 | 272,978,465 | ||||||
Reinvestment of distributions | 4,530,633 | 23,617,345 | ||||||
Cost of shares repurchased | (12,424,990) | (70,292,836) | ||||||
Increase in Net Assets From Fund Share Transactions | 23,920,182 | 226,302,974 | ||||||
Increase in Net Assets | 16,389,437 | 237,906,898 | ||||||
Net Assets: | ||||||||
Beginning of period | 431,340,498 | 193,433,600 | ||||||
End of period | $ | 447,729,935 | $ | 431,340,498 |
See Notes to Financial Statements.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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15 |
|
For a share of each class of beneficial interest outstanding throughout each year ended December 31, unless otherwise noted: |
Class A Shares1 | 20212 | |||
Net asset value, beginning of period | $ | 10.66 | ||
Income (loss) from operations: | ||||
Net investment income | 0.08 | |||
Net realized and unrealized loss | (0.16) | |||
Total loss from operations | (0.08) | |||
Less distributions from: | ||||
Net investment income | (0.09) | |||
Total distributions | (0.09) | |||
Net asset value, end of period | $ | 10.49 | ||
Total return3 | (0.64) | % | ||
Net assets, end of period (000s) | $ | 58 | ||
Ratios to average net assets: | ||||
Gross expenses | 0.93 | %4 | ||
Net expenses5 | 0.93 | 4 | ||
Net investment income | 1.70 | 4 | ||
Portfolio turnover rate | 23 | % |
1 | Per share amounts have been calculated using the average shares method. |
2 | For the period January 20, 2021 (inception date) to June 30, 2021 (unaudited). |
3 | Performance figures, exclusive of sales charges, may reflect compensating balance arrangements, fee waivers and/or expense reimbursements. In the absence of compensating balance arrangements, fee waivers and/or expense reimbursements, the total return would have been lower. Past performance is no guarantee of future results. Total returns for periods of less than one year are not annualized. |
4 | Annualized. |
5 | As a result of an expense limitation arrangement, the ratio of total annual fund operating expenses, other than interest, brokerage commissions, dividend expense on short sales, taxes, extraordinary expenses and acquired fund fees and expenses, to average net assets of Class A shares did not exceed 1.00%. This expense limitation arrangement cannot be terminated prior to December 31, 2022 without the Board of Trustees’ consent. In addition, the manager has agreed to waive the Fund’s management fee to an extent sufficient to offset the net management fee payable in connection with any investment in an affiliated money market fund. |
See Notes to Financial Statements.
16 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
For a share of each class of beneficial interest outstanding throughout each year ended December 31, unless otherwise noted: |
Class C Shares1 | 20212 | |||
Net asset value, beginning of period | $ | 10.66 | ||
Income (loss) from operations: | ||||
Net investment income | 0.05 | |||
Net realized and unrealized loss | (0.15) | |||
Total loss from operations | (0.10) | |||
Less distributions from: | ||||
Net investment income | (0.07) | |||
Total distributions | (0.07) | |||
Net asset value, end of period | $ | 10.49 | ||
Total return3 | (0.87) | % | ||
Net assets, end of period (000s) | $15 | |||
Ratios to average net assets: | ||||
Gross expenses | 1.85 | %4 | ||
Net expenses5,6 | 1.75 | 4 | ||
Net investment income | 1.00 | 4 | ||
Portfolio turnover rate | 23 | % |
1 | Per share amounts have been calculated using the average shares method. |
2 | For the period January 20, 2021 (inception date) to June 30, 2021 (unaudited). |
3 | Performance figures, exclusive of CDSC, may reflect compensating balance arrangements, fee waivers and/or expense reimbursements. In the absence of compensating balance arrangements, fee waivers and/or expense reimbursements, the total return would have been lower. Past performance is no guarantee of future results. Total returns for periods of less than one year are not annualized. |
4 | Annualized. |
5 | As a result of an expense limitation arrangement, the ratio of total annual fund operating expenses, other than interest, brokerage, taxes, extraordinary expenses and acquired fund fees and expenses, to average net assets of Class C shares did not exceed 1.75%. This expense limitation arrangement cannot be terminated prior to December 31, 2022 without the Board of Trustees’ consent. In addition, the manager has agreed to waive the Fund’s management fee to an extent sufficient to offset the net management fee payable in connection with any investment in an affiliated money market fund. |
6 | Reflects fee waivers and/or expense reimbursements. |
See Notes to Financial Statements.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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17 |
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Financial highlights (cont’d)
For a share of each class of beneficial interest outstanding throughout each year ended December 31, unless otherwise noted: |
Class I Shares1 | 20212 | 2020 | 20193 | |||||||||
Net asset value, beginning of period | $ | 10.68 | $ | 10.21 | $ | 10.00 | ||||||
Income (loss) from operations: | ||||||||||||
Net investment income | 0.11 | 0.26 | 0.26 | |||||||||
Net realized and unrealized gain (loss) | (0.19) | 0.91 | 0.34 | |||||||||
Total income (loss) from operations | (0.08) | 1.17 | 0.60 | |||||||||
Less distributions from: | ||||||||||||
Net investment income | (0.10) | (0.62) | (0.23) | |||||||||
Net realized gains | — | (0.08) | (0.16) | |||||||||
Total distributions | (0.10) | (0.70) | (0.39) | |||||||||
Net asset value, end of period | $ | 10.50 | $ | 10.68 | $ | 10.21 | ||||||
Total return4 | (0.74) | % | 11.74 | % | 6.02 | % | ||||||
Net assets, end of period (000s) | $84 | $128 | $81 | |||||||||
Ratios to average net assets: | ||||||||||||
Gross expenses | 0.79 | %5 | 0.75 | % | 0.80 | %5 | ||||||
Net expenses6,7 | 0.75 | 5 | 0.75 | 8 | 0.73 | 5 | ||||||
Net investment income | 2.00 | 5 | 2.41 | 3.32 | 5 | |||||||
Portfolio turnover rate | 23 | % | 111 | % | 86 | %9 |
1 | Per share amounts have been calculated using the average shares method. |
2 | For the six months ended June 30, 2021 (unaudited). |
3 | For the period March 29, 2019 (inception date) to December 31, 2019. |
4 | Performance figures may reflect compensating balance arrangements, fee waivers and/or expense reimbursements. In the absence of compensating balance arrangements, fee waivers and/or expense reimbursements, the total return would have been lower. Past performance is no guarantee of future results. Total returns for periods of less than one year are not annualized. |
5 | Annualized. |
6 | As a result of an expense limitation arrangement, the ratio of total annual fund operating expenses, other than interest, brokerage commissions, dividend expense on short sales, taxes, extraordinary expenses and acquired fund fees and expenses, to average net assets of Class I shares did not exceed 0.75%. This expense limitation arrangement cannot be terminated prior to December 31, 2022 without the Board of Trustees’ consent. In addition, the manager has agreed to waive the Fund’s management fee to an extent sufficient to offset the net management fee payable in connection with any investment in an affiliated money market fund. |
7 | Reflects fee waivers and/or expense reimbursements. |
8 | Reflects recapture of fees waived and/or expenses reimbursed from prior fiscal years. |
9 | Excludes securities received as a result of a contribution in-kind. |
See Notes to Financial Statements.
18 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
For a share of each class of beneficial interest outstanding throughout each year ended December 31, unless otherwise noted: |
Class IS Shares1 | 20212 | 2020 | 20193 | |||||||||
Net asset value, beginning of period | $ | 10.69 | $ | 10.21 | $ | 10.00 | ||||||
Income (loss) from operations: | ||||||||||||
Net investment income | 0.11 | 0.27 | 0.26 | |||||||||
Net realized and unrealized gain (loss) | (0.19) | 0.92 | 0.34 | |||||||||
Total income (loss) from operations | (0.08) | 1.19 | 0.60 | |||||||||
Less distributions from: | ||||||||||||
Net investment income | (0.11) | (0.63) | (0.23) | |||||||||
Net realized gains | — | (0.08) | (0.16) | |||||||||
Total distributions | (0.11) | (0.71) | (0.39) | |||||||||
Net asset value, end of period | $ | 10.50 | $ | 10.69 | $ | 10.21 | ||||||
Total return4 | (0.75) | % | 11.94 | % | 6.06 | % | ||||||
Net assets, end of period (millions) | $448 | $431 | $193 | |||||||||
Ratios to average net assets: | ||||||||||||
Gross expenses | 0.60 | %5 | 0.63 | % | 0.73 | %5 | ||||||
Net expenses6 | 0.60 | 5 | 0.63 | 7,8 | 0.65 | 5,7 | ||||||
Net investment income | 2.15 | 5 | 2.54 | 3.40 | 5 | |||||||
Portfolio turnover rate | 23 | % | 111 | % | 86 | %9 |
1 | Per share amounts have been calculated using the average shares method. |
2 | For the six months ended June 30, 2021 (unaudited). |
3 | For the period March 29, 2019 (inception date) to December 31, 2019. |
4 | Performance figures may reflect compensating balance arrangements, fee waivers and/or expense reimbursements. In the absence of compensating balance arrangements, fee waivers and/or expense reimbursements, the total return would have been lower. Past performance is no guarantee of future results. Total returns for periods of less than one year are not annualized. |
5 | Annualized. |
6 | As a result of an expense limitation arrangement, the ratio of total annual fund operating expenses, other than interest, brokerage commissions, dividend expense on short sales, taxes, extraordinary expenses and acquired fund fees and expenses, to average net assets of Class IS shares did not exceed 0.65%. In addition, the ratio of total annual fund operating expenses for Class IS shares did not exceed the ratio of total annual fund operating expenses for Class I shares. These expense limitation arrangements cannot be terminated prior to December 31, 2022 without the Board of Trustees’ consent. In addition, the manager has agreed to waive the Fund’s management fee to an extent sufficient to offset the net management fee payable in connection with any investment in an affiliated money market fund. |
7 | Reflects fee waivers and/or expense reimbursements. |
8 | Reflects recapture of fees waived and/or expenses reimbursed from prior fiscal years. |
9 | Excludes securities received as a result of a contribution in-kind. |
See Notes to Financial Statements.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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19 |
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Notes to financial statements (unaudited)
1. Organization and significant accounting policies
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) (the “Fund”) is a separate non-diversified investment series of Legg Mason Global Asset Management Trust (the “Trust”). The Trust, a Maryland statutory trust, is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company.
The following are significant accounting policies consistently followed by the Fund and are in conformity with U.S. generally accepted accounting principles (“GAAP”). Estimates and assumptions are required to be made regarding assets, liabilities and changes in net assets resulting from operations when financial statements are prepared. Changes in the economic environment, financial markets and any other parameters used in determining these estimates could cause actual results to differ. Subsequent events have been evaluated through the date the financial statements were issued.
(a) Investment valuation. The valuations for fixed income securities (which may include, but are not limited to, corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and certain derivative instruments are typically the prices supplied by independent third party pricing services, which may use market prices or broker/dealer quotations or a variety of valuation techniques and methodologies. The independent third party pricing services typically use inputs that are observable such as issuer details, interest rates, yield curves, prepayment speeds, credit risks/spreads, default rates and quoted prices for similar securities. Investments in open-end funds are valued at the closing net asset value per share of each fund on the day of valuation. Futures contracts are valued daily at the settlement price established by the board of trade or exchange on which they are traded. Equity securities for which market quotations are available are valued at the last reported sales price or official closing price on the primary market or exchange on which they trade. When the Fund holds securities or other assets that are denominated in a foreign currency, the Fund will normally use the currency exchange rates as of 4:00 p.m. (Eastern Time). If independent third party pricing services are unable to supply prices for a portfolio investment, or if the prices supplied are deemed by the manager to be unreliable, the market price may be determined by the manager using quotations from one or more broker/dealers or at the transaction price if the security has recently been purchased and no value has yet been obtained from a pricing service or pricing broker. When reliable prices are not readily available, such as when the value of a security has been significantly affected by events after the close of the exchange or market on which the security is principally traded, but before the Fund calculates its net asset value, the Fund values these securities as determined in accordance with procedures approved by the Fund’s Board of Trustees.
The Board of Trustees is responsible for the valuation process and has delegated the supervision of the daily valuation process to the Global Fund Valuation Committee (formerly known as Legg Mason North Atlantic Fund Valuation Committee prior to March 1, 2021) (the
20 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
“Valuation Committee”). The Valuation Committee, pursuant to the policies adopted by the Board of Trustees, is responsible for making fair value determinations, evaluating the effectiveness of the Fund’s pricing policies, and reporting to the Board of Trustees. When determining the reliability of third party pricing information for investments owned by the Fund, the Valuation Committee, among other things, conducts due diligence reviews of pricing vendors, monitors the daily change in prices and reviews transactions among market participants.
The Valuation Committee will consider pricing methodologies it deems relevant and appropriate when making fair value determinations. Examples of possible methodologies include, but are not limited to, multiple of earnings; discount from market of a similar freely traded security; discounted cash-flow analysis; book value or a multiple thereof; risk premium/yield analysis; yield to maturity; and/or fundamental investment analysis. The Valuation Committee will also consider factors it deems relevant and appropriate in light of the facts and circumstances. Examples of possible factors include, but are not limited to, the type of security; the issuer’s financial statements; the purchase price of the security; the discount from market value of unrestricted securities of the same class at the time of purchase; analysts’ research and observations from financial institutions; information regarding any transactions or offers with respect to the security; the existence of merger proposals or tender offers affecting the security; the price and extent of public trading in similar securities of the issuer or comparable companies; and the existence of a shelf registration for restricted securities.
For each portfolio security that has been fair valued pursuant to the policies adopted by the Board of Trustees, the fair value price is compared against the last available and next available market quotations. The Valuation Committee reviews the results of such back testing monthly and fair valuation occurrences are reported to the Board of Trustees quarterly.
The Fund uses valuation techniques to measure fair value that are consistent with the market approach and/or income approach, depending on the type of security and the particular circumstance. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable securities. The income approach uses valuation techniques to discount estimated future cash flows to present value.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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21 |
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Notes to financial statements (unaudited) (cont’d)
GAAP establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are summarized in the three broad levels listed below:
• | Level 1 — quoted prices in active markets for identical investments |
• | Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.) |
• | Level 3 — significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments) |
The inputs or methodologies used to value securities are not necessarily an indication of the risk associated with investing in those securities.
The following is a summary of the inputs used in valuing the Fund’s assets and liabilities carried at fair value:
ASSETS | ||||||||||||||||
Description | Quoted Prices (Level 1) | Other Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||
Long-Term Investments†: | ||||||||||||||||
U.S. Government & Agency Obligations | — | $191,219,037 | — | $191,219,037 | ||||||||||||
Sovereign Bonds | — | 156,513,648 | — | 156,513,648 | ||||||||||||
Corporate Bonds & Notes | — | 83,035,687 | — | 83,035,687 | ||||||||||||
Collateralized Mortgage Obligations | — | 2,516,555 | — | 2,516,555 | ||||||||||||
Asset-Backed Securities | — | 211,082 | — | 211,082 | ||||||||||||
Total Long-Term Investments | — | 433,496,009 | — | 433,496,009 | ||||||||||||
Short-Term Investments† | $11,784,319 | — | — | 11,784,319 | ||||||||||||
Total Investments | $11,784,319 | $433,496,009 | — | $445,280,328 | ||||||||||||
Other Financial Instruments: | ||||||||||||||||
Forward Foreign Currency Contracts†† | — | $ 1,828,451 | — | $1,828,451 | ||||||||||||
Total | $11,784,319 | $435,324,460 | — | $447,108,779 |
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LIABILITIES | ||||||||||||||||
Description | Quoted Prices (Level 1) | Other Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total | ||||||||||||
Other Financial Instruments: | ||||||||||||||||
Futures Contracts†† | $ | 887,004 | — | — | $ | 887,004 | ||||||||||
Forward Foreign Currency Contracts†† | — | $ | 2,193,444 | — | 2,193,444 | |||||||||||
Total | $ | 887,004 | $ | 2,193,444 | — | $ | 3,080,448 |
† | See Schedule of Investments for additional detailed categorizations. |
†† | Reflects the unrealized appreciation (depreciation) of the instruments. |
(b) Futures contracts. The Fund uses futures contracts generally to gain exposure to, or hedge against, changes in interest rates or gain exposure to, or hedge against, changes in certain asset classes. A futures contract represents a commitment for the future purchase or sale of an asset at a specified price on a specified date.
Upon entering into a futures contract, the Fund is required to deposit cash or securities with a broker in an amount equal to a certain percentage of the contract amount. This is known as the ‘‘initial margin’’ and subsequent payments (‘‘variation margin’’) are made or received by the Fund each day, depending on the daily fluctuation in the value of the contract. For certain futures, including foreign denominated futures, variation margin is not settled daily, but is recorded as a net variation margin payable or receivable. The daily changes in contract value are recorded as unrealized appreciation or depreciation in the Statement of Operations and the Fund recognizes a realized gain or loss when the contract is closed.
Futures contracts involve, to varying degrees, risk of loss in excess of the amounts reflected in the financial statements. In addition, there is the risk that the Fund may not be able to enter into a closing transaction because of an illiquid secondary market.
(c) Forward foreign currency contracts. The Fund enters into a forward foreign currency contract to hedge exposure of bond positions or in an attempt to increase the Fund’s return. A forward foreign currency contract is an agreement between two parties to buy and sell a currency at a set price with delivery and settlement at a future date. The contract is marked-to-market daily and the change in value is recorded by the Fund as an unrealized gain or loss. When a forward foreign currency contract is closed, through either delivery or offset by entering into another forward foreign currency contract, the Fund recognizes a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value of the contract at the time it is closed.
Non-deliverable forward foreign currency exchange contracts are settled with the counterparty in cash without the delivery of foreign currency.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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Notes to financial statements (unaudited) (cont’d)
Forward foreign currency contracts involve elements of market risk in excess of the amounts reflected on the Statement of Assets and Liabilities. The Fund bears the risk of an unfavorable change in the foreign exchange rate underlying the forward foreign currency contract. Risks may also arise upon entering into these contracts from the potential inability of the counterparties to meet the terms of their contracts.
(d) Foreign currency translation. Investment securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts based upon prevailing exchange rates on the date of valuation. Purchases and sales of investment securities and income and expense items denominated in foreign currencies are translated into U.S. dollar amounts based upon prevailing exchange rates on the respective dates of such transactions.
The Fund does not isolate that portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments.
Net realized foreign exchange gains or losses arise from sales of foreign currencies, including gains and losses on forward foreign currency contracts, currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the values of assets and liabilities, other than investments in securities, on the date of valuation, resulting from changes in exchange rates.
Foreign security and currency transactions may involve certain considerations and risks not typically associated with those of U.S. dollar denominated transactions as a result of, among other factors, the possibility of lower levels of governmental supervision and regulation of foreign securities markets and the possibility of political or economic instability.
(e) Credit and market risk. The Fund invests in high-yield and emerging market instruments that are subject to certain credit and market risks. The yields of high-yield and emerging market debt obligations reflect, among other things, perceived credit and market risks. The Fund’s investments in securities rated below investment grade typically involve risks not associated with higher rated securities including, among others, greater risk related to timely and ultimate payment of interest and principal, greater market price volatility and less liquid secondary market trading. The consequences of political, social, economic or diplomatic changes may have disruptive effects on the market prices of investments held by the Fund. The Fund’s investments in non-U.S. dollar denominated securities may also result in foreign currency losses caused by devaluations and exchange rate fluctuations.
24 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
Investments in securities that are collateralized by real estate mortgages are subject to certain credit and liquidity risks. When market conditions result in an increase in default rates of the underlying mortgages and the foreclosure values of underlying real estate properties are materially below the outstanding amount of these underlying mortgages, collection of the full amount of accrued interest and principal on these investments may be doubtful. Such market conditions may significantly impair the value and liquidity of these investments and may result in a lack of correlation between their credit ratings and values.
(f) Foreign investment risks. The Fund’s investments in foreign securities may involve risks not present in domestic investments. Since securities may be denominated in foreign currencies, may require settlement in foreign currencies or may pay interest or dividends in foreign currencies, changes in the relationship of these foreign currencies to the U.S. dollar can significantly affect the value of the investments and earnings of the Fund. Foreign investments may also subject the Fund to foreign government exchange restrictions, expropriation, taxation or other political, social or economic developments, all of which affect the market and/or credit risk of the investments.
(g) Counterparty risk and credit-risk-related contingent features of derivative instruments. The Fund may invest in certain securities or engage in other transactions where the Fund is exposed to counterparty credit risk in addition to broader market risks. The Fund may invest in securities of issuers, which may also be considered counterparties as trading partners in other transactions. This may increase the risk of loss in the event of default or bankruptcy by the counterparty or if the counterparty otherwise fails to meet its contractual obligations. The Fund’s subadviser attempts to mitigate counterparty risk by (i) periodically assessing the creditworthiness of its trading partners, (ii) monitoring and/or limiting the amount of its net exposure to each individual counterparty based on its assessment and (iii) requiring collateral from the counterparty for certain transactions. Market events and changes in overall economic conditions may impact the assessment of such counterparty risk by the subadviser. In addition, declines in the values of underlying collateral received may expose the Fund to increased risk of loss.
With exchange traded and centrally cleared derivatives, there is less counterparty risk to the Fund since the exchange or clearinghouse, as counterparty to such instruments, guarantees against a possible default. The clearinghouse stands between the buyer and the seller of the contract; therefore, the credit risk is limited to failure of the clearinghouse. While offset rights may exist under applicable law, the Fund does not have a contractual right of offset against a clearing broker or clearinghouse in the event of a default of the clearing broker or clearinghouse.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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25 |
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Notes to financial statements (unaudited) (cont’d)
The Fund has entered into master agreements, such as an International Swaps and Derivatives Association, Inc. Master Agreement (“ISDA Master Agreement”) or similar agreement, with certain of its derivative counterparties that govern over-the-counter (“OTC”) derivatives and provide for general obligations, representations, agreements, collateral posting terms, netting provisions in the event of default or termination and credit related contingent features. The credit related contingent features include, but are not limited to, a percentage decrease in the Fund’s net assets or net asset value per share over a specified period of time. If these credit related contingent features were triggered, the derivatives counterparty could terminate the positions and demand payment or require additional collateral.
Under an ISDA Master Agreement, the Fund may, under certain circumstances, offset with the counterparty certain derivative financial instruments’ payables and/or receivables with collateral held and/or posted and create one single net payment. However, absent an event of default by the counterparty or a termination of the agreement, the terms of the ISDA Master Agreements do not result in an offset of reported amounts of financial assets and financial liabilities in the Statement of Assets and Liabilities across transactions between the Fund and the applicable counterparty. The enforceability of the right to offset may vary by jurisdiction.
Collateral requirements differ by type of derivative. Collateral or margin requirements are set by the broker or exchange clearinghouse for exchange traded derivatives while collateral terms are contract specific for OTC traded derivatives. Cash collateral that has been pledged to cover obligations of the Fund under derivative contracts, if any, will be reported separately in the Statement of Assets and Liabilities. Securities pledged as collateral, if any, for the same purpose are noted in the Schedule of Investments.
As of June 30, 2021, the Fund held forward foreign currency contracts with credit related contingent features which had a liability position of $2,193,444. If a contingent feature in the master agreements would have been triggered, the Fund would have been required to pay this amount to its derivatives counterparties. As of June 30, 2021, the Fund had posted with its counterparties cash and/or securities as collateral to cover the net liability of these derivatives amounting to $1,450,000, which could be used to reduce the required payment.
At June 30, 2021, the Fund held cash collateral from JPMorgan Chase & Co. in the amount of $450,000. This amount can be used to reduce the Fund’s exposure to the counterparty in the event of default.
(h) Security transactions and investment income. Security transactions are accounted for on a trade date basis. Interest income (including interest income from payment-in-kind securities), adjusted for amortization of premium and accretion of discount, is recorded on the accrual basis. Paydown gains and losses on mortgage- and asset-backed securities are recorded as adjustments to interest income. Dividend income is recorded on the ex-dividend
26 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
date for dividends received in cash and/or securities. Foreign dividend income is recorded on the ex-dividend date or as soon as practicable after the Fund determines the existence of a dividend declaration after exercising reasonable due diligence. The cost of investments sold is determined by use of the specific identification method. To the extent any issuer defaults or a credit event occurs that impacts the issuer, the Fund may halt any additional interest income accruals and consider the realizability of interest accrued up to the date of default or credit event.
(i) Distributions to shareholders. Distributions from net investment income of the Fund, if any, are declared and paid on a quarterly basis. Distributions of net realized gains, if any, are declared at least annually. Distributions to shareholders of the Fund are recorded on the ex-dividend date and are determined in accordance with income tax regulations, which may differ from GAAP.
(j) Share class accounting. Investment income, common expenses and realized/ unrealized gains (losses) on investments are allocated to the various classes of the Fund on the basis of daily net assets of each class. Fees relating to a specific class are charged directly to that share class.
(k) Compensating balance arrangements. The Fund has an arrangement with its custodian bank whereby a portion of the custodian’s fees is paid indirectly by credits earned on the Fund’s cash on deposit with the bank.
(l) Federal and other taxes. It is the Fund’s policy to comply with the federal income and excise tax requirements of the Internal Revenue Code of 1986 (the “Code”), as amended, applicable to regulated investment companies. Accordingly, the Fund intends to distribute its taxable income and net realized gains, if any, to shareholders in accordance with timing requirements imposed by the Code. Therefore, no federal or state income tax provision is required in the Fund’s financial statements.
Management has analyzed the Fund’s tax positions taken on income tax returns for all open tax years and has concluded that as of December 31, 2020, no provision for income tax is required in the Fund’s financial statements. The Fund’s federal and state income and federal excise tax returns for tax years for which the applicable statutes of limitations have not expired are subject to examination by the Internal Revenue Service and state departments of revenue.
Under the applicable foreign tax laws, a withholding tax may be imposed on interest, dividends and capital gains at various rates. Realized gains upon disposition of securities issued in or by certain foreign countries are subject to capital gains tax imposed by those countries. As of June 30, 2021, there were $67,625 of capital gains tax liabilities accrued on unrealized gains.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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27 |
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Notes to financial statements (unaudited) (cont’d)
(m) Reclassification. GAAP requires that certain components of net assets be reclassified to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or net asset value per share.
2. Investment management agreement and other transactions with affiliates
Legg Mason Partners Fund Advisor, LLC (“LMPFA”) is the Fund’s investment manager and Brandywine Global Investment Management, LLC (“Brandywine Global”) is the Fund’s subadviser. LMPFA and Brandywine Global are indirect, wholly-owned subsidiaries of Franklin Resources, Inc. (“Franklin Resources”).
LMPFA provides administrative and certain oversight services to the Fund. The Fund pays an investment management fee, calculated daily and paid monthly, at an annual rate of 0.50% of the Fund’s average daily net assets. LMPFA delegates to the subadviser the day-to-day portfolio management of the Fund. For its services, LMPFA pays Brandywine Global a fee monthly, at an annual rate equal to 70% of the net management fee it receives from the Fund.
As a result of expense limitation arrangements between the Fund and LMPFA, the ratio of total annual fund operating expenses, other than interest, brokerage commissions, dividend expense on short sales, taxes, extraordinary expenses and acquired fund fees and expenses, to average net assets of Class A, Class C, Class I and Class IS shares did not exceed 1.00%, 1.75%, 0.75% and 0.65%, respectively. In addition, the ratio of total annual fund operating expenses for Class IS shares did not exceed the ratio of total annual fund operating expenses for Class I shares. These expense limitation arrangements cannot be terminated prior to December 31, 2022 without the Board of Trustees’ consent. In addition, the manager has agreed to waive the Fund’s management fee to an extent sufficient to offset the net management fee payable in connection with any investment in an affiliated money market fund (the “affiliated money market fund waiver”). The affiliated money market fund waiver is not subject to the recapture provision discussed below.
During the six months ended June 30, 2021, fees waived and/or expenses reimbursed amounted to $23.
LMPFA is permitted to recapture amounts waived and/or reimbursed to a class within three years after the fiscal year in which LMPFA earned the fee or incurred the expense if the class’ total annual fund operating expenses have fallen to a level below the expense limitation (“expense cap”) in effect at the time the fees were earned or the expenses incurred. In no case will LMPFA recapture any amount that would result, on any particular business day of the Fund, in the class’ total annual fund operating expenses exceeding the expense cap or any other lower limit then in effect.
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Pursuant to these arrangements, at June 30, 2021, the Fund had remaining fee waivers and/or expense reimbursements subject to recapture by LMPFA and respective dates of expiration as follows:
Class C1 | Class I | Class IS | ||||||||||
Expires December 31, 2022 | — | $ | 23 | $ | 91,451 | |||||||
Expires December 31, 2023 | — | — | — | |||||||||
Expires December 31, 2024 | $ | 3 | 20 | — | ||||||||
Total fee waivers/expense reimbursements subject to recapture | $ | 3 | $ | 43 | $ | 91,451 |
1 | For the period January 20, 2021 (inception date) to June 30, 2021 (unaudited). |
For the six months ended June 30, 2021, LMPFA did not recapture any fees.
Legg Mason Investor Services, LLC (“LMIS”) serves as the Fund’s sole and exclusive distributor. LMIS is an indirect, wholly-owned broker-dealer subsidiary of Franklin Resources. As of July 7, 2021, LMIS was renamed Franklin Distributors, LLC.
There is a maximum initial sales charge of 4.25% for Class A shares. In certain cases, Class A shares have a 1.00% CDSC, which applies if redemption occurs within 18 months from purchase payment. This CDSC only applies to those purchases of Class A shares, which, when combined with current holdings of other shares of funds sold by LMIS, equal or exceed $1,000,000 in the aggregate. These purchases do not incur an initial sales charge.
For the six months ended June 30, 2021, LMIS and its affiliates did not receive any sales charges on sales of the Fund’s Class A shares. In addition, for the six months ended June 30, 2021, there were no CDSCs paid to LMIS and its affiliates.
All officers and one Trustee of the Trust are employees of Franklin Resources or its affiliates and do not receive compensation from the Trust.
As of June 30, 2021, Franklin Resources and its affiliates owned 98% of the Fund.
3. Investments
During the six months ended June 30, 2021, the aggregate cost of purchases and proceeds from sales of investments (excluding short-term investments) and U.S. Government & Agency Obligations were as follows:
Investments | U.S. Government & Agency Obligations | |||||||
Purchases | $ | 53,319,632 | $ | 74,221,136 | ||||
Sales | 67,756,398 | 30,240,165 |
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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29 |
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Notes to financial statements (unaudited) (cont’d)
At June 30, 2021, the aggregate cost of investments and the aggregate gross unrealized appreciation and depreciation of investments for federal income tax purposes were substantially as follows:
Cost | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Net Unrealized Appreciation (Depreciation) | |||||||||||||
Securities | $ | 438,300,242 | $ | 10,410,459 | $ | (3,430,373) | $ | 6,980,086 | ||||||||
Futures contracts | — | — | (887,004) | (887,004) | ||||||||||||
Forward foreign currency contracts | — | 1,828,451 | (2,193,444) | (364,993) |
4. Derivative instruments and hedging activities
Below is a table, grouped by derivative type, that provides information about the fair value and the location of derivatives within the Statement of Assets and Liabilities at June 30, 2021.
ASSET DERIVATIVES1 | ||||
Foreign Exchange Risk | ||||
Forward foreign currency contracts | $ | 1,828,451 |
LIABILITY DERIVATIVES1 | ||||||||||||||||
Interest Rate Risk | Foreign Exchange Risk | Total | ||||||||||||||
Futures contracts2 | $ | 887,004 | — | $ | 887,004 | |||||||||||
Forward foreign currency contracts | — | $ | 2,193,444 | 2,193,444 | ||||||||||||
Total | $ | 887,004 | $ | 2,193,444 | $ | 3,080,448 |
1 | Generally, the balance sheet location for asset derivatives is receivables/net unrealized appreciation and for liability derivatives is payables/net unrealized depreciation. |
2 | Includes cumulative unrealized appreciation (depreciation) of futures contracts as reported in the Schedule of Investments. Only net variation margin is reported within the receivables and/or payables on the Statement of Assets and Liabilities. |
30 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
The following tables provide information about the effect of derivatives and hedging activities on the Fund’s Statement of Operations for the six months ended June 30, 2021. The first table provides additional detail about the amounts and sources of gains (losses) realized on derivatives during the period. The second table provides additional information about the change in unrealized appreciation (depreciation) resulting from the Fund’s derivatives and hedging activities during the period.
AMOUNT OF REALIZED GAIN (LOSS) ON DERIVATIVES RECOGNIZED | ||||||||||||
Interest Rate Risk | Foreign Exchange Risk | Total | ||||||||||
Futures contracts | $ | 4,736,874 | — | $ | 4,736,874 | |||||||
Forward foreign currency contracts | — | $ | (7,040,036) | (7,040,036) | ||||||||
Total | $ | 4,736,874 | $ | (7,040,036) | $ | (2,303,162) | ||||||
CHANGE IN UNREALIZE D APPRECIATION (DEPRECIATION) ON DERIVATIVES RECOGNIZED | ||||||||||||
Interest Rate Risk | Foreign Exchange Risk | Total | ||||||||||
Futures contracts | $ | (1,147,396) | — | $ | (1,147,396) | |||||||
Forward foreign currency contracts | — | $ | 8,057,580 | 8,057,580 | ||||||||
Total | $ | (1,147,396) | $ | 8,057,580 | $ | 6,910,184 |
During the six months ended June 30, 2021, the volume of derivative activity for the Fund was as follows:
Average Market Value | ||||
Futures contracts (to sell) | $ | 30,296,964 | ||
Forward foreign currency contracts (to buy) | 43,725,126 | |||
Forward foreign currency contracts (to sell) | 173,659,858 |
The following table presents the Fund’s OTC derivative assets and liabilities by counterparty net of amounts available for offset under an ISDA Master Agreement and net of the related collateral pledged (received) by the Fund as of June 30, 2021.
Counterparty | Gross Assets Subject to Master Agreements1 | Gross Liabilities Subject to Master Agreements1 | Net Assets (Liabilities) Subject to Master Agreements | Collateral Pledged (Received)2,3 | Net Amount4,5 | |||||||||||||||
Barclays Bank PLC | $ | 49,974 | $ | (17,720) | $ | 32,254 | — | $ | 32,254 | |||||||||||
Citibank N.A. | 331,405 | (315,976) | 15,429 | — | 15,429 | |||||||||||||||
Goldman Sachs Group Inc. | 29,170 | (889) | 28,281 | — | 28,281 | |||||||||||||||
HSBC Securities Inc. | 74,132 | (1,605,881) | (1,531,749) | $ | 1,450,000 | (81,749) | ||||||||||||||
JPMorgan Chase & Co. | 1,343,770 | (252,978) | 1,090,792 | (450,000) | 640,792 | |||||||||||||||
Total | $ | 1,828,451 | $ | (2,193,444) | $ | (364,993) | $ | 1,000,000 | $ | 635,007 |
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
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Notes to financial statements (unaudited) (cont’d)
1 | Absent an event of default or early termination, derivative assets and liabilities are presented gross and not offset in the Statement of Assets and Liabilities. |
2 | Gross amounts are not offset in the Statement of Assets and Liabilities. |
3 | In some instances, the actual collateral received and/or pledged may be more than the amount shown here due to overcollateralization. |
4 | Net amount may also include forward foreign currency exchange contracts that are not required to be collateralized. |
5 | Represents the net amount receivable (payable) from (to) the counterparty in the event of default. |
5. Class specific expenses, waivers and/or expense reimbursements
The Fund has adopted a Rule 12b-1 shareholder services and distribution plan and under that plan the Fund pays service and/or distribution fees with respect to its Class A and Class C shares calculated at the annual rate of 0.25% and 1.00% of the average daily net assets of each class, respectively. Service and/or distribution fees are accrued daily and paid monthly.
For the six months ended June 30, 2021, class specific expenses were as follows:
Service and/or Distribution Fees | Transfer Agent Fees | |||||||
Class A1 | $ | 30 | $ | 12 | ||||
Class C1 | 32 | 9 | ||||||
Class I | — | 99 | ||||||
Class IS | — | 77 | ||||||
Total | $ | 62 | $ | 197 |
1 For the period January 20, 2021 (inception dp1 ate) to June 30, 2021 (unaudited).
For the six months ended June 30, 2021, waivers and/or expense reimbursements by class were as follows:
Waivers/Expense Reimbursements | ||||
Class C1 | $ | 3 | ||
Class I | 20 | |||
Total | $ | 23 |
1 | For the period January 20, 2021 (inception date) to June 30, 2021 (unaudited). |
32 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
6. Distributions to shareholders by class
Six Months Ended June 30, 2021 | Year Ended December 31, 2020 | |||||||
Net Investment Income: | ||||||||
Class A1 | $ | 266 | — | |||||
Class C1 | 63 | — | ||||||
Class I | 867 | $ | 8,603 | |||||
Class IS | 4,588,905 | 20,716,433 | ||||||
Total | $ | 4,590,101 | $ | 20,725,036 | ||||
Net Realized Gains: | ||||||||
Class A1 | — | |||||||
Class C1 | — | |||||||
Class I | — | $ | 956 | |||||
Class IS | — | 3,135,178 | ||||||
Total | — | $ | 3,136,134 |
1 | For the period January 20, 2021 (inception date) to June 30, 2021 (unaudited). |
7. Shares of beneficial interest
At June 30, 2021, the Trust had an unlimited number of shares of beneficial interest authorized with a par value of $0.00001 per share. The Fund has the ability to issue multiple classes of shares. Each class of shares represents an identical interest and has the same rights, except that each class bears certain direct expenses, including those specifically related to the distribution of its shares.
Transactions in shares of each class were as follows:
Six Months Ended June 30, 2021 | Year Ended December 31, 2020 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Class A | ||||||||||||||||
Shares sold | 8,627 | 1 | $ | 90,418 | 1 | — | — | |||||||||
Shares issued on reinvestment | 21 | 1 | 223 | 1 | — | — | ||||||||||
Shares repurchased | (3,074) | 1 | (32,214) | 1 | — | — | ||||||||||
Net increase | 5,574 | $ | 58,427 | — | — | |||||||||||
Class C | ||||||||||||||||
Shares sold | 1,426 | 1 | $ | 15,005 | 1 | — | — | |||||||||
Shares issued on reinvestment | 3 | 1 | 32 | 1 | — | — | ||||||||||
Shares repurchased | (3) | 1 | (37) | 1 | — | — | ||||||||||
Net increase | 1,426 | $ | 15,000 | — | — |
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
|
33 |
|
Notes to financial statements (unaudited) (cont’d)
Six Months Ended June 30, 2021 | Year Ended December 31, 2020 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Class I | ||||||||||||||||
Shares sold | — | — | 26,790 | $ | 282,449 | |||||||||||
Shares issued on reinvestment | 41 | $ | 427 | 691 | 7,252 | |||||||||||
Shares repurchased | (3,979) | (42,010) | (23,427) | (251,249) | ||||||||||||
Net increase (decrease) | (3,938) | $ | (41,583) | 4,054 | $ | 38,452 | ||||||||||
Class IS | ||||||||||||||||
Shares sold | 3,009,344 | $ | 31,709,116 | 25,952,996 | $ | 272,696,016 | ||||||||||
Shares issued on reinvestment | 433,150 | 4,529,951 | 2,233,068 | 23,610,093 | ||||||||||||
Shares repurchased | (1,170,929) | (12,350,729) | (6,780,196) | (70,041,587) | ||||||||||||
Net increase | 2,271,565 | $ | 23,888,338 | 21,405,868 | $ | 226,264,522 |
1 | For the period January 20, 2021 (inception date) to June 30, 2021 (unaudited). |
8. Transactions with affiliated companies
As defined by the 1940 Act, an affiliated company is one in which the Fund owns 5% or more of the outstanding voting securities, or a company which is under common ownership or control with the Fund. The following company was considered an affiliated company for all or some portion of the six months ended June 30, 2021. The following transactions were effected in such company for the six months ended June 30, 2021.
Affiliate Value at December 31, 2020 | Purchased | Sold | ||||||||||||||||||
Cost | Shares | Cost | Shares | |||||||||||||||||
Western Asset Premier Institutional U.S. Treasury Reserves, Premium Shares | — | $ | 25,603,816 | 25,603,816 | $ | 13,819,497 | 13,819,497 |
(cont’d) | Realized Gain (Loss) | Interest Income | Net Increase (Decrease) in Unrealized Appreciation (Depreciation) | Affiliate Value at June 30, 2021 | ||||||||||||
Western Asset Premier Institutional U.S. Treasury Reserves, Premium Shares | — | $ | 90 | — | $ | 11,784,319 |
9. Redemption facility
Effective February 5, 2021, the Fund’s redemption facility (the “Redemption Facility”) was terminated and the Fund and certain other participating funds within the Trust, together with other U.S. registered and foreign investment funds (collectively, the “Borrowers”) managed by LMPFA or Franklin Resources, became borrowers in a joint syndicated senior
34 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
unsecured credit facility totaling $2.675 billion (the “Global Credit Facility”). The Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests. Unless renewed, the Global Credit Facility will terminate on February 4, 2022.
Under the terms of the Global Credit Facility, the Fund shall, in addition to interest charged on any borrowings made by the Fund and other costs incurred by the Fund, pay its share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon its relative share of the aggregate net assets of all the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility; there is no upfront fee. Under the Redemption Facility, the Fund had access to the aggregate amount of $190 million, and the following terms were in effect: the annual commitment fee to maintain the Redemption Facility was 0.15% incurred on the unused portion of the facility and there was an annual upfront fee of 0.06%. The aggregate commitment fees under the Global Credit Facility and Redemption Facility are reflected in the Statement of Operations. The Fund did not utilize the Global Credit Facility nor the Redemption Facility during the six months ended June 30, 2021.
10. Recent accounting pronouncement
In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update No. 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting (the “ASU”). The amendments in the ASU provide optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management has reviewed the requirements and believes the adoption of this ASU will not have a material impact on the financial statements.
11. Other matters
The outbreak of the respiratory illness COVID-19 (commonly referred to as “coronavirus”) has continued to rapidly spread around the world, causing considerable uncertainty for the global economy and financial markets. The ultimate economic fallout from the pandemic, and the long-term impact on economies, markets, industries and individual issuers, are not known. The COVID-19 pandemic could adversely affect the value and liquidity of the Fund’s investments, impair the Fund’s ability to satisfy redemption requests, and negatively impact the Fund’s performance. In addition, the outbreak of COVID-19, and measures taken to mitigate its effects, could result in disruptions to the services provided to the Fund by its service providers.
* * *
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
|
35 |
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Notes to financial statements (unaudited) (cont’d)
The Fund’s investments, payment obligations, and financing terms may be based on floating rates, such as the London Interbank Offered Rate, or “LIBOR,” which is the offered rate for short-term Eurodollar deposits between major international banks. On March 5, 2021, the ICE Benchmark Administration, the administrator of LIBOR, stated that it will cease the publication of (i) the overnight and one-, three-, six- and twelve-month USD LIBOR settings immediately following the LIBOR publication on Friday, June 30, 2023 and (ii) all other LIBOR settings, including the one-week and two-month USD LIBOR settings, immediately following the LIBOR publication on Friday, December 31, 2021. There remains uncertainty regarding the nature of any replacement rate and the impact of the transition from LIBOR on the Fund’s transactions and the financial markets generally. As such, the potential effect of a transition away from LIBOR on the Fund or the Fund’s investments cannot yet be determined.
12. Subsequent event
Subsequent to the period ended June 30, 2021, shareholder redemptions from Class IS shares exceeded 50% of Class IS net assets as of June 30, 2021.
36 | BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) 2021 Semi-Annual Report |
Additional shareholder information (unaudited)
Results of special meeting of shareholders
A special meeting of shareholders was held on June 15, 2021 for shareholders of record as of March 1, 2021 (the “Record Date”) to elect the Board of Trustees of the Trust. Shareholders of the Fund and each other series of the Trust voted together as a single class to elect the Board.
Shareholders of the Trust voted as indicated below (vote totals are rounded to the nearest whole number). Effective July 1, 2021, the Board is composed of the following Trustees:
Trustee | For | Withheld | ||||||
Paul R. Ades | 11,915,712,078 | 203,516,727 | ||||||
Andrew L. Breech | 11,923,087,811 | 196,140,993 | ||||||
Althea L. Duersten | 11,972,830,693 | 146,398,111 | ||||||
Stephen R. Gross | 11,919,258,594 | 199,970,210 | ||||||
Susan M. Heilbron | 11,970,320,096 | 148,908,708 | ||||||
Howard J. Johnson | 11,919,503,553 | 199,725,251 | ||||||
Arnold L. Lehman | 11,920,774,188 | 198,454,617 | ||||||
Robin J.W. Masters | 11,971,843,764 | 147,385,040 | ||||||
Jerome H. Miller | 11,919,153,082 | 200,075,722 | ||||||
Ken Miller | 11,922,645,083 | 196,583,722 | ||||||
G. Peter O’Brien | 11,919,113,936 | 200,114,868 | ||||||
Thomas F. Schlafly | 11,917,628,123 | 201,600,682 | ||||||
Jane E. Trust | 11,985,902,999 | 133,325,805 |
The above Trustees have also been elected to serve as board members of other mutual funds within the Franklin Templeton fund complex.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged) |
|
37 |
|
BrandywineGLOBAL —
Global Opportunities Bond Fund (USD Hedged)
Trustees*
Paul R. Ades
Andrew L. Breech
Althea L. Duersten**
Chair
Stephen R. Gross
Susan M. Heilbron
Howard J. Johnson
Arnold L. Lehman
Robin J. W. Masters
Jerome H. Miller
Ken Miller
G. Peter O’Brien
Thomas F. Schlafly
Jane Trust
Investment manager
Legg Mason Partners Fund Advisor, LLC
Subadviser
Brandywine Global Investment Management, LLC
Distributor
Franklin Distributors, LLC†
Custodian
The Bank of New York Mellon
Transfer agent
BNY Mellon Investment Servicing (US) Inc.
4400 Computer Drive
Westborough, MA 01581
Independent registered public accounting firm
PricewaterhouseCoopers LLP
Baltimore, MD
* | During a June 15, 2021 special meeting of shareholders, a new group of Trustees were elected to oversee the mutual funds of Legg Mason Global Asset Management Trust, Legg Mason Partners Equity Trust and Legg Mason Partners Variable Equity Trust, effective July 1, 2021. |
** | Effective July 1, 2021, Ms. Duersten became Chair. |
† | Effective July 7, 2021, LMIS was renamed Franklin Distributors, LLC. |
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged)
The Fund is a separate investment series of Legg Mason Global Asset Management Trust, a Maryland statutory trust.
BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged)
Legg Mason Funds
620 Eighth Avenue, 47th Floor
New York, NY 10018
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (“SEC”) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Forms N-PORT are available on the SEC’s website at www.sec.gov. To obtain information on Form N-PORT, shareholders can call the Fund at 1-877-721-1926.
Information on how the Fund voted proxies relating to portfolio securities during the prior 12-month period ended June 30th of each year and a description of the policies and procedures that the Fund uses to determine how to vote proxies related to portfolio transactions are available (1) without charge, upon request, by calling the Fund at 1-877-721-1926, (2) at www.leggmason.com/mutualfunds and (3) on the SEC’s website at www.sec.gov.
This report is submitted for the general information of the shareholders of BrandywineGLOBAL — Global Opportunities Bond Fund (USD Hedged). This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by a current prospectus.
Investors should consider the Fund’s investment objectives, risks, charges and expenses carefully before investing. The prospectus contains this and other important information about the Fund. Please read the prospectus carefully before investing.
www.leggmason.com
© 2021 Franklin Distributors, LLC,
Member FINRA/SIPC. All rights reserved.
Legg Mason Funds Privacy and Security Notice
Your Privacy and the Security of Your Personal Information is Very Important to the Legg Mason Funds
This Privacy and Security Notice (the “Privacy Notice”) addresses the Legg Mason Funds’ privacy and data protection practices with respect to nonpublic personal information the Funds receive. The Legg Mason Funds include any funds sold by the Funds’ distributor, Franklin Distributors, LLC, as well as Legg Mason-sponsored closed-end funds. The provisions of this Privacy Notice apply to your information both while you are a shareholder and after you are no longer invested with the Funds.
The Type of Nonpublic Personal Information the Funds Collect About You
The Funds collect and maintain nonpublic personal information about you in connection with your shareholder account. Such information may include, but is not limited to:
• | Personal information included on applications or other forms; |
• | Account balances, transactions, and mutual fund holdings and positions; |
• | Bank account information, legal documents, and identity verification documentation; |
• | Online account access user IDs, passwords, security challenge question responses; and |
• | Information received from consumer reporting agencies regarding credit history and creditworthiness (such as the amount of an individual’s total debt, payment history, etc.). |
How the Funds Use Nonpublic Personal Information About You
The Funds do not sell or share your nonpublic personal information with third parties or with affiliates for their marketing purposes, or with other financial institutions or affiliates for joint marketing purposes, unless you have authorized the Funds to do so. The Funds do not disclose any nonpublic personal information about you except as may be required to perform transactions or services you have authorized or as permitted or required by law.
The Funds may disclose information about you to:
• | Employees, agents, and affiliates on a “need to know” basis to enable the Funds to conduct ordinary business, or to comply with obligations to government regulators; |
• | Service providers, including the Funds’ affiliates, who assist the Funds as part of the ordinary course of business (such as printing, mailing services, or processing or servicing your account with us) or otherwise perform services on the Funds’ behalf, including companies that may perform statistical analysis, market research and marketing services solely for the Funds; |
• | Permit access to transfer, whether in the United States or countries outside of the United States to such Funds’ employees, agents and affiliates and service providers as required to enable the Funds to conduct ordinary business, or to comply with obligations to government regulators; |
• | The Funds’ representatives such as legal counsel, accountants and auditors to enable the Funds to conduct ordinary business, or to comply with obligations to government regulators; |
• | Fiduciaries or representatives acting on your behalf, such as an IRA custodian or trustee of a grantor trust. |
NOT PART OF THE SEMI-ANNUAL REPORT |
Legg Mason Funds Privacy and Security Notice (cont’d)
Except as otherwise permitted by applicable law, companies acting on the Funds’ behalf, including those outside the United States, are contractually obligated to keep nonpublic personal information the Funds provide to them confidential and to use the information the Funds share only to provide the services the Funds ask them to perform. The Funds may disclose nonpublic personal information about you when necessary to enforce their rights or protect against fraud, or as permitted or required by applicable law, such as in connection with a law enforcement or regulatory request, subpoena, or similar legal process. In the event of a corporate action or in the event a Fund service provider changes, the Funds may be required to disclose your nonpublic personal information to third parties. While it is the Funds’ practice to obtain protections for disclosed information in these types of transactions, the Funds cannot guarantee their privacy policy will remain unchanged.
Keeping You Informed of the Funds’ Privacy and Security Practices
The Funds will notify you annually of their privacy policy as required by federal law. While the Funds reserve the right to modify this policy at any time they will notify you promptly if this privacy policy changes.
The Funds’ Security Practices
The Funds maintain appropriate physical, electronic and procedural safeguards designed to guard your nonpublic personal information. The Funds’ internal data security policies restrict access to your nonpublic personal information to authorized employees, who may use your nonpublic personal information for Fund business purposes only.
Although the Funds strive to protect your nonpublic personal information, they cannot ensure or warrant the security of any information you provide or transmit to them, and you do so at your own risk. In the event of a breach of the confidentiality or security of your nonpublic personal information, the Funds will attempt to notify you as necessary, so you can take appropriate protective steps. If you have consented to the Funds using electronic communications or electronic delivery of statements, they may notify you under such circumstances using the most current email address you have on record with them.
In order for the Funds to provide effective service to you, keeping your account information accurate is very important. If you believe that your account information is incomplete, not accurate or not current, if you have questions about the Funds’ privacy practices, or our use of your nonpublic personal information, write the Funds using the contact information on your account statements, email the Funds by clicking on the Contact Us section of the Funds’ website at www.leggmason.com, or contact the Fund at 1-877-721-1926.
Revised April 2018
Legg Mason California Consumer Privacy Act Policy
Although much of the personal information we collect is “nonpublic personal information” subject to federal law, residents of California may, in certain circumstances, have additional rights under the California Consumer Privacy Act (“CCPA”). For example, if you are a broker, dealer, agent, fiduciary, or representative acting by or on behalf of, or for, the account of any other person(s) or household, or a financial advisor, or if you have otherwise provided personal information to us separate from the relationship we have with personal investors, the provisions of this Privacy Policy apply to your personal information (as defined by the CCPA).
NOT PART OF THE SEMI-ANNUAL REPORT |
Legg Mason Funds Privacy and Security Notice (cont’d)
• | In addition to the provisions of the Legg Mason Funds Security and Privacy Notice, you may have the right to know the categories and specific pieces of personal information we have collected about you. |
• | You also have the right to request the deletion of the personal information collected or maintained by the Funds. |
If you wish to exercise any of the rights you have in respect of your personal information, you should advise the Funds by contacting them as set forth below. The rights noted above are subject to our other legal and regulatory obligations and any exemptions under the CCPA. You may designate an authorized agent to make a rights request on your behalf, subject to the identification process described below. We do not discriminate based on requests for information related to our use of your personal information, and you have the right not to receive discriminatory treatment related to the exercise of your privacy rights.
We may request information from you in order to verify your identity or authority in making such a request. If you have appointed an authorized agent to make a request on your behalf, or you are an authorized agent making such a request (such as a power of attorney or other written permission), this process may include providing a password/passcode, a copy of government issued identification, affidavit or other applicable documentation, i.e. written permission. We may require you to verify your identity directly even when using an authorized agent, unless a power of attorney has been provided. We reserve the right to deny a request submitted by an agent if suitable and appropriate proof is not provided.
For the 12-month period prior to the date of this Privacy Policy, the Legg Mason Funds have not sold any of your personal information; nor do we have any plans to do so in the future.
Contact Information
Address: Data Privacy Officer, 100 International Dr., Baltimore, MD 21202
Email: DataProtectionOfficer@franklintempleton.com
Phone: 1-800-396-4748
Revised October 2020
NOT PART OF THE SEMI-ANNUAL REPORT |
www.leggmason.com
© 2021 Franklin Distributors, LLC, Member FINRA/SIPC. All rights reserved.
BWXX534262 8/21 SR21-4222
ITEM 2. | CODE OF ETHICS. |
Not applicable.
ITEM 3. | AUDIT COMMITTEE FINANCIAL EXPERT. |
Not applicable.
ITEM 4. | PRINCIPAL ACCOUNTANT FEES AND SERVICES. |
Not applicable.
ITEM 5. | AUDIT COMMITTEE OF LISTED REGISTRANTS. |
Not applicable.
ITEM 6. | SCHEDULE OF INVESTMENTS. |
Included herein under Item 1.
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. |
Not applicable.
ITEM 11. | CONTROLS AND PROCEDURES. |
(a) | The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a- 3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the disclosure controls and procedures required by Rule 30a-3(b) under the 1940 Act and 15d-15(b) under the Securities Exchange Act of 1934. |
(b) | There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are likely to materially affect the registrant’s internal control over financial reporting. |
ITEM 12. | DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable
ITEM 13. | EXHIBITS. |
(a) (1) Not applicable.
Exhibit 99.CODE ETH
(a) (2) Certifications pursuant to section 302 of the Sarbanes-Oxley Act of 2002 attached hereto.
Exhibit 99.CERT
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 attached hereto.
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, there unto duly authorized.
Legg Mason Global Asset Management Trust | ||
By: | /s/ Jane Trust | |
Jane Trust | ||
Chief Executive Officer | ||
Date: | August 23, 2021 |
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/ Jane Trust | |
Jane Trust | ||
Chief Executive Officer | ||
Date: | August 23, 2021 | |
By: | /s/ Christopher Berarducci | |
Christopher Berarducci | ||
Principal Financial Officer | ||
Date: | August 23, 2021 |