EFTA01071219.pdf

DoubleLine Emerging Markets Outlook: A Cautious Road Ahead Eir Live Webcast Hosted By: Luz Padilla Director Emerging Markets Fixed Income Fund (DBLEX/DLENX) Low Duration Emerging Markets Fixed Income Fund (DBLLX/DELNX) DoubleLine October 6, 2015 EFTA01071219  DoubleLine Fund Offerings Emerging Markets Fixed Income Fund Low Duration Emerging Markets Fixed Income Fund Retail and Institutional Class Retail and Institutional Class No Load Mutual Fund No Load Mutual Fund Retail Inst. Retail Inst. N-share I-share N-share I-share Ticker DLENX DBLEX Ticker DELNX DBLLX Min Investment $2,000 $100,000 Min Investment $2,000 $100,000 Min IRA Investment $500 $5,000 Min IRA Investment $500 $5,000 Gross Expense Ratio 1.15% 0.90% Gross Expense Ratio 1.16% 0.91% Net Expense Ratio* 0.84% 0.59% The funds' investment objectives, risks, charges and expenses must be considered carefully before investing. The statutory and summary prospectuses contain this and other important information about the investment company, and may be obtained by calling 1 (877) 354-6311/1 (877) DLinell, or visiting www.doublelinefunds.com. Read carefully before investing. Mutual fund investing involves risk; Principal loss is possible. The Emerging Markets and Low Duration Emerging Markets Funds Invest in debt securities in lower- rated and non-rated securities present a greater risk of loss to principal and interest than higher-rated securities. The Funds invests in foreign securities which involve greater volatility and political, economic and currency risks and differences in accounting methods. These risks are greater for investments in emerging markets. Derivatives may involve certain costs and risks such as liquidity, interest rate, market, credit, management and the risk that a position could not be closed when most advantageous. Opinions expressed are subject to change at any time, are not forecasts and should not be considered investment advice. Fund holdings and sector allocations are subject to change and are not a recommendation to buy or sell any security. 'The Advisor has contractually agreed to waive fees and reimburse expenses through July 31, 2016. Diversification does not assure a profit or protect against loss in a declining market. DoubleLine Funds are distributed by Quasar Distributors, LLC. While the Funds are no-load, management fees and other expenses still apply. Please refer to the prospectus for further details. DoubleLine EMFI Webcast 10.6-2015 1 EFTA01071220  DoubleLine Announcements Rising Rates Webcast — October 20, 2015 Funds for a rising rate environment featuring: Andrew Hsu — Low Duration Fund Luz Padilla — Low Duration Emerging Markets Fund Robert Cohen — Floating Rate Fund Go to www.doublelinefunds.com, Home page under "Events" 2015 Webcast Schedule to register 1:15 pm PDT/4:15 pm EDT Jeffrey Gundlach — November 10, 2015 Closed End Funds (DBL/DSL) Go to www.doublelinefunds.com, Home page under "Events" 2015 Webcast Schedule to register 1:15 pm PDT/4:15 pm EDT To Receive Presentation Slides: You can email DoubleLine EMFI Webcast 10.6-2015 2 EFTA01071221  DoubleLinetir Emerging Markets Fixed Income Fund F U N D S Portfolio Performance — Quarter End September 30, 2015 Year-To- Since Inception 3Q 3-Year 5-Year Date 1-Year Annualized 2015 Annualized Annualized 2015 (4-6-10 to 9-30-15) I-share -5.09% -2.53% -4.84% 1.07% 4.19% 5.06% N-share -5.15% -2.80% -5.17% 0.82% 3.94% 4.81% JP Morgan Emerging Markets -1.71% -0.07% -0.62% 1.50% 4.73% 6.01% Bond Global Diversified Index s of September 30, 2015 I-share N-share Gross SEC 30-Day Yield 5.60% 5.35% Net SEC 30-Day Yield 5.60% 5.35% I-share N-share Gross Expense Ratio 0.90% 1.15% Performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment willfluctuate so that an investor's shares, when redeemed, may be worth more or less than original cost. Current performance of the fund may be lower or higher than the performance quoted. Performance data current to the most recent month-end may be obtained by calling 213-633-8200 or by visiting www.doublelinefunds.com. If a Fund invested in an affiliate Fund sponsored by the Advisor during the period covered by this report, the Advisor agreed to not charge a management fee to the Fund in an amount equal to the investment advisory fee paid by the affiliated Fund's investment in the affiliated Fund to avoid duplicate charge of the investment advisory fees to the investors. JP Morgan Emerging Markets Bond Global Diversified Index is a uniquely-weighted version of the EMBI Global. It limits the weights of those Index countries with larger debt stocks by only including specified portions of these countries' eligible current face amounts of debt outstanding. The countries covered in the EMBI Global Diversified are identical to those covered in by EMBI Global. Past Performance does not guarantee future results. Index performance is not illustrative of fund performance. An investment cannot be made in an index. The performance information shown assumes the reinvestment of all dividends and distributions. DoubleLine EMFI Webcast 10.6-2015 3 EFTA01071222  DoubleLiner Low Duration Emerging Markets Fixed Income Fund F U N D S Portfolio Performance — September 30, 2015 Since Inception Year-To- Annualized 3Q2015 Date 2015 1-Year (4-7-14 to 9-30-15) I-share (DBLLX) -3.39% -0.82% -1.93% 0.58% N-share (DELNX) -3.45% -0.90% -2.06% 0.42% JP Morgan CEMBI Broad Div. Maturity 1-3 -1.12% 2.82% 1.65% 1.74% Year s of September 30, 2015 I-share N-share Gross SEC 30-Day Yield 4.13% 3.87% Net SEC 30-Day Yield 4.40% 4.15% I-share N-share Gross Expense Ratio 0.91% 1.16% Net Expense Ratio* 0.59% 0.84% Performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than original cost. Current performance of the fund may be lower or higher than the performance quoted. Performance data current to the most recent month-end may be obtained by calling 213-633-8200 or by visiting www.doublelinefunds.corn. Short term performance, in particular, is not a good indication of the fund's future performance, and an investment should not be made based solely on returns. *The Advisor has contractually agreed to waive fees and reimburse expenses through July 31, 2016. If a Fund invested in an affiliate Fund sponsored by the Advisor during the period covered by this report, the Advisor agreed to not charge a management fee to the Fund in an amount equal to the investment advisory fee paid by the affiliated Fund's investment in the affiliated Fund to avoid duplicate charge of the investment advisory fees to the investors. JP Morgan CEMBI Broad Diversified 1-3 Year is a market capitalization weighted index consisting of 1-3 year maturity US-denominated Emerging Market corporate bonds. It is a liquid global corporate benchmark representing Asia, Latin America, Europe and the Middle East/Africa. It is not possible to invest in an index. Past Performance does not guarantee future results. Index performance is not illustrative of fund performance. The performance information shown assumes the reinvestment of all dividends and distributions. DoubleLine EMFI Webcast 10.6-2015 4 EFTA01071223  DoubleLine TAB I External Global Headwinds Remain Doubletine EMFI Webcast 10.6-2015 5 EFTA01071224  DoubleLine Emerging Markets Fixed Income Headwind Starting 2015 In the February 2015 Emerging Markets (EM) webcast, we identified key risks for Emerging Markets. As the year has progressed, we have seen these risk begin to play out. • Country Specific Risks • "Terrible 3" — Argentina, Venezuela, Ukraine • Countries in Transitions — Brazil and Russia • Greece • Rising U.S. Treasury Yields • Global Growth Slowdown • Falling Commodity Prices DoubleLine EMFI Webcast 10.6-2015 6 EFTA01071225  DoubleLine Emerging Markets Fixed Income Challenges Ahead Risks we see for the remainder of the year • Global Growth Slowdown • China • Political Risk • Brazil, Venezuela, Argentina, Russia • Potential for Rising U.S. Treasury Yields • Potential for Falling Commodity Prices DoubleLine EMFI Webcast 10.6-2015 7 EFTA01071226  DoubleLine TAB II Developed Market Headwinds DoubleLine EMFI Webcast 10.6.2015 II EFTA01071227  DoubleLinelr Emerging Markets F U N D S The Fed on Hold in September - The FOMC maintained the target range for the federal funds rate at 0% to 0.25% at the September 17, 2015 meeting Probability of Fed Raising Rates at the December 2015 Meeting 90.0% - 80.0% - 70.0% 60.0% - 50.0% -0 0- - 40.0% -o a) 30.0% g- - 20.0% 10.0% 0.0% in LA Ul Ul Ul Ul Lal Lal Lal Lal Ul Ul Ul Ul Ul Ul Ul Lal Lal Lal Lal Ul Lal Lal Lal Lal Lal Lal Ul Ul Ul Ul 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 NI NI NJ NI NI NI NI NI NI NI NI NJ NI NI NI NI NI NI NI NI NI NI NI NI NI NI NI NI NI NI NI NI CNI N. fel rn ▪ Ul in NI CO en ▪ o▪ in ▪ cri ▪ in NI CO 1' 0 ct 0 Ul NI ▪ N. IN ▪ 00 • •Ct 00 •Ct 0 NI NI NI \ NI NJ NI NJ NJ M\ NJ NJ CH ▪ ul 01 Tr 1' ct O La La La La UD ▪ to • to n r". r-. 00 00 00 00 0 0 0 0 Source: Doubleline, Bloomberg, Data as of 4/7/2015 to 9/30/2015 FOMC • Federal Open Market Committee which consists of twelve members. Probability of the Federal Reserve raising the target range for the Federal Funds Rate at the December 16, 2015 meeting, as implied by Fed Fund futures DoubleLine EMFI Webcast 10.6-2015 9 EFTA01071228  DoubleLinelr Emerging Markets F U N D S Monetary Policy Divergence Policy Rate Q/E 0-0.25% FED On hold, but looking to hike Program ended 0.05% Purchases of EUR60bn Pc ECB On hold month 0.1% Purchases of JPY80trn per BoJ On hold year Source: DoubleLine, Bloomberg, FED: Federal Reserve, ECB: European Central Bank, BoJ: Bank of Japan. Q/E: Quantitative Easing. EUR: Euros, WY: Yen As of October 5,2015, the EUR 60bn is equivalent to 567.12 bn US dollars and JPY 80bn is equivalent to 566.02 bn US dollars. DoubleLine EMFI Webcast 10-6-2015 10 EFTA01071229  DoubleLine Emerging Markets F U N D S it Dollar Strength a Headwind for Commodities TWI Dollar vs GSCI Commodity Index Source: DoubleLine, Bloomberg, Data as of 10/1/2014-10/1/20IS TWI Dollar or the USTWBROA Index: US Trade Weighted Broad Dollar Index is the weighted average of the Foreign Exchange Value of the U.S. Dollar against the currencies of a Broad Group of Major U.S Trading Partners. GSCI Commodity Index is widely recognized as a leading measure of general price movements and inflation in the world economy. It provides investors with a reliable and publicly available benchmark for the investment performance in the commodity markets. Please see index definitions in the appendix. One cannot invest directly in an index. DoubleLine EMFI Webcast 10.6-2015 11 EFTA01071230  DoubleLine TAB III China and Falling Commodity Prices DoubleLine EMFI Webeast 10.6-2015 12 EFTA01071231  Emerging Markets DoubleLine F U N D S ir China Equity Sell Off - Shanghai Composite Index 1D 3D 1M 6M YID 1Y SY Flax [ma « Security/Study Po Event track Annotate News . Zoom T M Last Price 3052.781 T Nigh on 06/12/15 5166350 e- average 3503.590 1 Low on 10/27/14 2290.437 5000 4500 4000 3500 2500 51• Volume 14.6648 itIlnull 506 Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep 2014 2015 Source: DoubleLine, Bloomberg, Data as of 09/30/2014 to 09/30/15 Shanghai Composite Index or the SHCOMP Index is a capitalization-weighted index. The index tracks the daily performance of all A-shares and B-shares listed on the Shanghai Stock Exchange. DoubleLine EMFI Webcast 10.6-2015 13 EFTA01071232  DoubleLiner Emerging Markets F U N D S China Currency Devaluation China Currency Devaluation Source: DoubleLine, Bloomberg, Data as of 12/29/2011 to 10/1/2015 USD/CNY Mid Rate or the CNYMUSD Index is the daily CNY fixing price released by the China Foreign Exchange Trading System DoubleLine EMFI Webcast 10.6-2015 14 EFTA01071233  DoubleLind' Emerging Markets F U N D S China Currency Devaluation in Perspective China Currency Devaluation Small Relative to EMFX Performance Dedcd Custom PI Basket GBI EM ni Base Curr USD 12 31 2014 09/30/2015 Spot Returns (%) -2.37 1)Chinese Renminbi CNY -3.88 2) Indian Rupee INR -4.29 3) Philippine Peso PHP -6.37 4) Romanian Leu RON -6.71 5)Hungarian Forint HUF -6.72 6) Polish Zloty PLN -7.08 7) Russian Ruble RUB -7.85 8)Peruvian New Sol PEN -7.93 9)Nigerian Naira NGN -9.51 10)Thai Baht THB -12.80 11) Mexican Peso MXN -12.91 12)Chilean Peso CLP -15.46 13) Indonesian Rupiah IDR -16.49 14)South African Rand ZAR -20.43 15) Malaysian Ringgit MYR -22.83 16)Turkish Lira TRY -23.03 17) Colombian Peso COP -32.68 18) Brazilian Real BRL Source: DoubleLine, Bloomberg Dates: 12/31/2014 to 09/30/2015 DoubleLine EMFI Webcast 10.6-2015 15 EFTA01071234  DoubleLine r Emerging Markets F U N D S China Growth Slowdown China GDP vs China Li Ke Qiang Index ID 3D Ill 6M YTD lY SY Max Quarterly • Track / , ,n0tate NenS . Zoom O Reset Last Price r •CNG0PY0Y Index (R1) 7.0 x• CLICQINDX Index (L1) 3.09 3.05 01 Q3 01 Q3 01 03 01 Q3 01 Q3 01 03 01 Q3 01 03 0 2008 2009 2010 2011 2012 2013 2014 2015 20 Source: DoubleLine, Bloomberg, Dates: 2008 to 10/1/2015 China GDP or the CNGCNOY Index is China's Gross Domestic Product China Li Ke Qiang Index or the CLKQINDX index is the weighted average annual growth rates in outstanding bank loans (40%), electricity production (40%) and rail freight volume (20%). DoubleLine EMFI Webcast 10-6-2015 16 EFTA01071235  DoubleLine Emerging Markets F U N D S II' China's Commodity Consumption China's Share of Commodity Consumption (2013) Cement 58.50% Pork 51.30% Nickel 50.50% Coal 50.30% Steel 49.80% Aluminium 47.20% Copper 46.70% Lead 41.90% Cotton 31.80% Rice 30.70% Poultry 15.90% Beef & Veal 12.20% Oil 11.80% Nat Gas 4.80% 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% Source: KKR, USDA, USGS, World Steel Association, China National Bureau of Statistics, EIA, !EA, BP Statistical Review, World Bureau of Metal Statistics, Bloomberg, Haver Analytics Dates: 2013 DoubleLine EMFI Webcast 10.6-2015 17 EFTA01071236  DoubleLinelr F U N D S Emerging Markets Falling Commodity Prices GSCI Commodity Price Indexes 1.2 1.1 Standardized Index Level 0.9 Peak-to- current decline 0.8 0.7 -36.7% — GSCI Energy (TR) 0.6 -38.1% — GSCI Precious Metals (TR) 0.5 GSCI Copper (TR) -59.2% 0.4 IN CM fel CM fel CM fel CM CM CM CM M CM ct V V a s '4' '4" '4" '4" '4" •cl" ‘I" Vt L.n Vt La La 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CV IN CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV CV •-• ▪ •-• CO rl▪ 0▪ rl 0 •-• rl 0 .-1 0 ."1▪ rl CO rl▪ 0 .-1 0 rl ."1 0 ."1 ▪ 0▪ •-• .-1 CO ."1 0 rl 0 ."1 rl▪ 0 tel l-J COM COM COMO) ell etl COM/Om M COM COM COM CO tel /O COM MO) COMO) M oo on 0 ti N *-1 N CO ▪ .* VI Up N 00 CO 0 (-4 CO Ct VI lip N 00 ▪ CT Source: DoubleLine, Bloomberg, CME GSCI Energy: S&P Dow Jones GSCI Commodity Index is a sub-index of the S&P GSCI Index providing investment performance in the energy commodity market (WTI Crude Oil, Brent Crude Oil, Gas Oil, Heating Oil, MOB Gasoline, Natural Gas). GSCI Precious Metals: S&P Dow Jones GSCI Precious Metals Index is a sub-index of the S&P GSCI Index providing the investment performance of the precious metals sector (Gold, Silver). GSCI Copper: S&P Dow Jones GSCI Copper Index is the spot price of copper(LME Copper). GSCI Commodity Index is widely recognized as a leading measure of general price movements and inflation in the world economy. It provides investors with a reliable and publicly available benchmark for the investment performance in the commodity markets. Data from December 2012 to September 201S. DoubleLine EMFI Webcast 10.6-2015 18 EFTA01071237  DoubleLine Emerging Markets China has a Strong Balance Sheet •Reserves: US$3.6 trillion •Net foreign assets: US$4.4 trillion •Trade surplus averaged around US$45 billion a month so far this year •Current Account Surplus: +2.76% of GDP Source: DoubleLine Emerging Markets team as of October 5, 2015 GDP: Gross Domestic Product DoubleLine EMFI Webcast 10.6-2015 19 EFTA01071238  DoubleLine Emerging Markets China Engaged in Significant Policy Easing • Cutting interest rates • Easing Reserve Requirements for banks • Easing home purchase regulations • Easing local government debt financing These measures typically work with lags, so we expect to see the impact over the coming quarters DoubleLine EMFI Webcast 10.6-2015 20 EFTA01071239  DoubleLine TAB IV Brazil in Focus DoubleLine EMFI Webcast 10.6.2015 21 EFTA01071240  DoubleLine Emerging Markets Outlook Brazil Political Risk President Dilma Rousseff's government has been trying to implement deep and unpopular fiscal and structural reforms. Congress opposition to the adjustment has led to continued fiscal account deterioration. High level executives and politicians allegedly received kickbacks from state-oil company, Petrobras, in a corruption scandal know as Lavo Jato. Corruption charges and policy uncertainty regarding the fiscal adjustment has led to: • Erosion of consumer and business confidence • Stalled investment and growth • Deterioration of fiscal account and rising debt levels • Loss of investment grade rating by S&P S&P: Standard and Poors As of September 30, DoubleLine Emerging Market Fixed Income Fund held 0% of Petrobras and the Low Duration Emerging Markets Fixed Income Fund held 0% of Petrobras. DoubleLine EMFI Webcast 10.6-2015 22 EFTA01071241  DoubleLine Emerging Markets Outlook F U N D S Brazil Slowing Growth Brazil GDP YoY 1995=100 IBGE BZGDYOY% Index 99 Save As... 96) Actions - 91) Edit- 99 Table Line Cha rt 12 31/2010 06/30/2015 Last Price 11) Compare Mov. Avgs 1D 3D 1M 614 YID IV SY Max Daily • CC Security/Study ti Event Track / Maletate t; Nerd ^. ZOOM S. Last Price -2.60 - T High on 12/31/10 5.76 6.00 Average 1.90 1ton on 06/30/15 -2.60 5.00 4.00 3.00 2.00 1.00 0.00 -2.00 -3.00 3/31 6/30 9/30 12/31 3/31 6/10 9/30 12/31 3/11 6/30 9/30 /2/31 3/31 6/JO 9/30 12/31 3/31 6/30 Source: Bloomberg, Dates 2010 to 2Q2015 GOP: Gross Domestic Product DoubleLine EMFI Webcast 10-6-2015 23 EFTA01071242  DoubleLine Emerging Markets Outlook F U N D S Brazil Deteriorating Fiscal Balances BZPBPR% Index 95) Save As... 96) Actions - 97) Edit- 98) Table Line Chart 09/30/2009 08/31/2015ILast Price Compare Mov. _ No Lower Chart 1D 3D 1M GM YTD lY 5Y Max Monthly (.1". Security/Study Pa Event rack / mnotate mihvs Zoom • Last Price -0.760 i T High on 07/31/11 3.570 -,- Avant 1.762 1 Low on 07/31/15 -0.890 he' X Dec Mar Jun See Dec Mar Jun See Dec Mar Jun See Dec Mar Jun See Dec Mar Jun Sep p &RIM 2010 2011 2012 2013 2014 Source: Bloomberg, Banco Central do Brasil Dates: 09/30/2009 to 08/31/2015 Brazil Public Primary Budget Result %of GDP 12 Month Flows DoubleLine EMFI Webcast 10-6-2015 24