Diversified exposure to emerging markets, seeking to capture value and growth

The Fund normally invests at least 80% of its total assets in equity securities of companies located in emerging (less developed) markets and other investments that are tied economically to emerging markets. Generally these investments include common stock, preferred and preference stock, American Depositary Receipts, European Depositary Receipts, Global Depositary Receipts, and exchange-traded funds (“ETFs”) that invest in emerging markets securities.

Causeway uses a quantitative investment approach to purchase and sell investments for the Fund. Causeway’s proprietary computer model analyzes a variety of factors to assist in selecting securities. The model currently analyzes factors relating to valuation, sentiment, technical indicators, macroeconomics, currency, and country-sector aggregate.

YTD Return*
+15.38%
Nav*
$11.33, -0.07
Inception
March 30, 2007
Cusip
149498107
Benchmark
MSCI Emerging Markets
Minimum Investment
$1,000,000
Sales Charge
None
Gross Expense Ratio
1.16%
Net Expense Ratio
1.11%
*As of November 13, 2024
**Contractual fee waivers are in effect until 1/31/2025.

Strategy overview

The portfolio managers discuss our Emerging Markets strategy.

Portfolio managers

Quantitative Portfolio Manager
Head of Quantitative Research
Quantitative Portfolio Manager
Quantitative Portfolio Manager
Quantitative Portfolio Manager

Performance

QTD YTD 1 year3 years5 years10 years Since inception
Fund -3.9%17.4%32.5%1.6%5.7%3.6%4.3%
MSCI Emerging Markets -4.3%12.2%25.9%-1.0%4.3%3.8%3.9%
QTD YTD 1 year3 years5 years10 years Since inception
Fund -3.9%17.4%32.5%1.6%5.7%3.6%4.3%
MSCI Emerging Markets -4.3%12.2%25.9%-1.0%4.3%3.8%3.9%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 4.0%22.2%31.0%3.3%7.4%4.2%4.6%
MSCI Emerging Markets 8.9%17.2%26.5%0.8%6.1%4.4%4.2%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 4.0%22.2%31.0%3.3%7.4%4.2%4.6%
MSCI Emerging Markets 8.9%17.2%26.5%0.8%6.1%4.4%4.2%
2023202220212020201920182017201620152014201320122011201020092008
Fund 17.2%-23.0%-1.3%16.9%16.7%-17.9%39.8%9.2%-16.0%2.1%-2.6%25.8%-18.1%26.3%88.1%-58.4%
MSCI Emerging Markets 10.3%-19.7%-2.2%18.7%18.9%-14.2%37.8%11.6%-14.6%-1.8%-2.3%18.6%-18.2%19.2%79.0%-53.2%
Fund
MSCI Emerging Markets
2023202220212020201920182017201620152014201320122011201020092008
17.2%-23.0%-1.3%16.9%16.7%-17.9%39.8%9.2%-16.0%2.1%-2.6%25.8%-18.1%26.3%88.1%-58.4%
10.3%-19.7%-2.2%18.7%18.9%-14.2%37.8%11.6%-14.6%-1.8%-2.3%18.6%-18.2%19.2%79.0%-53.2%

Portfolio (as of October 31, 2024)

Benchmark: MSCI Emerging Markets
Asset Allocation
Fund
Stocks 97.7%
Cash 2.3%
Fund Characteristics
Fund Benchmark
No. of holdings 185 1278
Weighted avg. market cap (US $MM) $128,733 $123,941
NTM price/earnings 8.6 12.1
Price/book value 1.4 1.9
NTM EPS revision (wtd. avg) 16.0 5.0
Net assets $1,608,767,109 -
TOP 10 ACTIVE HOLDINGS
Security Country Active weight*
REC Ltd. India 1.7%
China Construction Bank Corp. China 1.5%
Hon Hai Precision Industry Co., Ltd. Taiwan 1.4%
Kia Corp. South Korea 1.3%
Ping An China 1.3%
Shriram Finance Ltd. India 1.0%
International Games System Co., Ltd. Taiwan 1.0%
Tencent Holdings Ltd. China 0.9%
Aurobindo Pharma Ltd. India 0.9%
Cosco Shipping Holdings Co China 0.8%

A "weighted average” measures a characteristic by the market capitalization of each stock. Price/book value is the weighted average of the price/book values of all the stocks in a portfolio. The P/B value of a company is calculated by dividing the market price of its stock by the company’s per-share book value. The price/earnings ratio is the weighted average of the price/earnings ratios of the stocks in a portfolio. “Earnings-per-share” is the portion of a company’s profit allocated to each outstanding share of common stock. “Earnings-per-share year-over-year estimate growth (next 12 months)” is the average next-12-month earnings-per-share estimate from one year ago for an individual company compared with that estimate today; note that this calculation is done on a company-by-company basis and is aggregated through a weighted average based on the individual company’s weight in the corresponding index. Also note that this characteristic is supplied directly by MSCI.

*Active defined as Fund weight minus MSCI EM Index weight. Holdings are subject to change.

SECTOR WEIGHTS
Sector Fund Benchmark
Information Technology 22.8% 23.7%
Financials 19.3% 23.2%
Consumer Discretionary 14.5% 13.5%
Industrials 12.6% 6.7%
Communication Services 9.5% 9.0%
Health Care 4.8% 3.5%
Energy 3.6% 4.6%
Materials 3.3% 6.5%
Equity Funds 2.7% 0.0%
Utilities 2.1% 2.8%
Consumer Staples 1.7% 5.0%
Real Estate 1.0% 1.6%
TOP 10 COUNTRIES
Country Fund Benchmark
China 28.5% 27.4%
Taiwan 22.3% 19.1%
India 21.0% 18.8%
South Korea 13.6% 10.1%
Brazil 3.5% 4.8%
Turkey 1.9% 0.6%
Indonesia 1.3% 1.6%
Malaysia 1.1% 1.4%
United Arab Emirates 1.0% 1.2%
Thailand 0.9% 1.5%
Regional Allocation
  • Emerging Asia 89.0%
  • Emerging Europe, Middle East, Africa 4.9%
  • Emerging Latin America 3.9%

Commentary (As of October 31, 2024)

Highlights

  • After months of gains, EM equities retreated in October as the 10-Year US Treasury Yield rose during the month, bolstering the US dollar and weighing on EM assets.
  • Chinese authorities, recognizing the inadequacy of recent efforts, have introduced aggressive measures to stimulate their economy. The People’s Bank of China (PBOC) cut the required reserve ratio for Chinese banks by 50 basis points, a larger reduction than most investors anticipated, freeing up approximately 1 trillion yuan for new lending. We believe additional interest rate cuts, and broader measures to support the Chinese real estate market, are likely.
  • South Korean stocks represent one of the Fund’s largest country overweights. During the third quarter, the South Korean stock exchange announced the index constituents linked to its Value-Up program. The Index criteria are profitability, shareholder return, valuation, and capital efficiency. From a sector perspective, information technology and industrials are the largest sectors in the Index. The Fund is overweight South Korean stocks due primarily to attractive valuations. We include quality in our model and we believe the Fund’s South Korean investments will benefit if the Value-Up initiative gains traction.

Portfolio attribution

The Causeway Emerging Markets Fund (“Fund”), on a net asset value basis, outperformed the Index in October 2024. We use both bottom-up “stock-specific” and top-down factor categories to seek to forecast alpha for the stocks in the Fund’s investable universe. Our bottom-up growth, technical (price momentum), and corporate events factors were positive indicators in October. Our valuation and competitive strength factors were negative indicators. Our top-down macroeconomic and country/sector aggregate were positive indicators, while currency was a negative indicator.

Quarterly Investment Outlook

During the third quarter, the US Federal Reserve reduced its benchmark interest rate and indicated that additional interest rate cuts are likely. More accommodative central bank policy in the US, and the potential for a weaker US dollar, should be tailwinds for EM assets. Chinese authorities, recognizing the inadequacy of recent efforts, have introduced aggressive measures to stimulate their economy. The People’s Bank of China (PBOC) cut the required reserve ratio for Chinese banks by 50 basis points, a larger reduction than most investors anticipated, freeing up approximately 1 trillion yuan for new lending. We believe additional interest rate cuts, and broader measures to support the Chinese real estate market, are likely. The PBOC also increased financing availability for stock repurchase activity, which we believe will support China’s financial markets. On the consumption side, several Chinese cities and provinces have announced vouchers to bolster spending in a variety of goods and services, including traveling, dine-in, and sports. The Fund was overweight Chinese stocks due in part to valuation considerations. South Korean stocks represent one of the Fund’s largest country overweights. During the third quarter, the South Korean stock exchange announced the index constituents linked to its Value-Up program. The Index criteria are profitability, shareholder return, valuation, and capital efficiency. From a sector perspective, information technology and industrials are the largest sectors in the Index. The Fund is overweight South Korean stocks due primarily to attractive valuations. We include quality in our model and we believe the Fund’s South Korean investments will benefit if the Value-Up initiative gains traction.

The market commentary expresses the portfolio managers’ views as of the date of this report and should not be relied on as research or investment advice regarding any stock. These views and the Fund holdings and characteristics are subject to change. There is no guarantee that any forecasts made will come to pass. Any securities identified and described in this report do not represent all of the securities purchased, sold or recommended for client accounts. The reader should not assume that an investment in the securities identified was or will be profitable. Diversification does not protect against market loss. Current and future holdings are subject to risk. The Fund may invest in derivatives, which are often more volatile than other investments and may magnify the Fund's gains or losses. Investing in ETFs is subject to the risks of the underlying funds. International and emerging markets investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles or from social, economic or political instability in other nations. Emerging markets and smaller companies involve additional risks and higher volatility.

Distributions

Dividends Short-term capital gains Long-term capital gains
2023 $0.4762 $0.0000 $0.0000
2022 $0.4290 $0.0000 $0.0000
2021 $0.3956 $0.0000 $2.4046
2020 $0.2052 $0.0000 $0.0000
2019 $0.2650 $0.0000 $0.0000
2018 $0.2296 $0.0000 $0.0000
2017 $0.2232 $0.0000 $0.0000
2016 $0.1597 $0.0000 $0.0000
2015 $0.1620 $0.0000 $0.0000
2014 $0.2775 $0.0000 $0.0000
2013 $0.0825 $0.0000 $0.0000
2012 $0.2526 $0.0000 $0.0000
2011 $0.0778 $0.0000 $0.0000
2010 $0.2451 $0.0000 $0.0000
2009 $0.2830 $0.0000 $0.0000
2008 $0.1186 $0.0000 $0.0000
2007 $0.2002 $0.4003 $0.0000

Distributions are per share. Distribution amounts are based on gains and losses realized and income earned by the Fund through October 31 (or earlier under certain circumstances).

Documents

Fund information:

Forms: