Combining our time-tested abilities in developed and emerging international markets

The Fund invests primarily in companies both in developed markets excluding the United States (the “international value portfolio”) and in emerging markets (the “emerging markets portfolio”). Causeway allocates substantially all of the Fund’s assets between the international value portfolio and the emerging markets portfolio using a proprietary asset allocation model.

International Value Portfolio: The international value portfolio consists primarily of common stocks of companies located in developed countries outside the US. Normally, the majority of this portfolio invests in companies that pay dividends or repurchase their shares. The international value portfolio may also invest in companies located in emerging (less developed) markets.

Emerging Markets Portfolio: The emerging markets portfolio is normally invested 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 that invest in emerging markets securities.

YTD Return*
-20.17%
Nav*
$10.96, +0.10
Inception
December 31, 2009
Cusip
14949Q107
Benchmark
MSCI ACWI ex US
Minimum Investment
$1,000,000
Sales Charge
None
Net Expense Ratio
1.05
Gross Expense Ratio
1.06
*As of May 28, 2020
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Strategy overview

The portfolio managers discuss our International Opportunities strategy.

Portfolio managers

Chief Executive Officer
Fundamental Portfolio Manager
President
Head of Fundamental Research
Fundamental Portfolio Manager
Fundamental Portfolio Manager
Fundamental Portfolio Manager
Fundamental Portfolio Manager
Fundamental Portfolio Manager
Fundamental Portfolio Manager
Head of Quantitative Research
Quantitative Portfolio Manager
Quantitative Portfolio Manager
Quantitative Portfolio Manager
Fundamental Portfolio Manager

Performance

QTD YTD 1 year3 years5 years10 years Since inception
Fund 9.5%-24.2%-18.5%-4.4%-3.0%2.6%2.8%
MSCI ACWI ex US 7.6%-17.4%-11.1%0.2%0.3%3.4%3.3%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 9.5%-24.2%-18.5%-4.4%-3.0%2.6%2.8%
MSCI ACWI ex US 7.6%-17.4%-11.1%0.2%0.3%3.4%3.3%
QTD YTD 1 year3 years5 years10 years Since inception
Fund -30.7%-30.7%-23.6%-6.4%-3.9%1.7%1.9%
MSCI ACWI ex US -23.3%-23.3%-15.1%-1.5%-0.2%2.5%2.6%
QTD YTD 1 year3 years5 years10 years Since inception
Fund -30.7%-30.7%-23.6%-6.4%-3.9%1.7%1.9%
MSCI ACWI ex US -23.3%-23.3%-15.1%-1.5%-0.2%2.5%2.6%
2019201820172016201520142013201220112010
Fund 21.7%-18.4%29.6%2.0%-6.1%-3.7%17.8%24.6%-12.6%15.4%
MSCI ACWI ex US 22.1%-13.8%27.8%5.0%-5.3%-3.4%15.8%17.4%-13.3%11.6%
Fund
MSCI ACWI ex US
2019201820172016201520142013201220112010
21.7%-18.4%29.6%2.0%-6.1%-3.7%17.8%24.6%-12.6%15.4%
22.1%-13.8%27.8%5.0%-5.3%-3.4%15.8%17.4%-13.3%11.6%

Portfolio (as of April 30, 2020)

Benchmark: MSCI ACWI ex US
Asset Allocation
Fund
Stocks 98.9%
Cash 1.1%
Fund Characteristics
Fund Benchmark
No. of holdings 189 2407
Weighted avg. market cap (US $MM) $61,236 $59,846
FY2 price/earnings 10.2 12.9
Price/book value 1.0 1.4
Net assets $157,247,545 -
TOP 10 HOLDINGS
Security Country Percent
Volkswagen AG Germany 3.7
FANUC Corp. Japan 3.2
Takeda Pharmaceutical Co., Ltd. Japan 3.0
BASF SE Germany 2.9
UniCredit S.p.A. Italy 2.6
Siemens AG Germany 2.6
ABB Ltd. Switzerland 2.4
Barclays Plc United Kingdom 2.3
British American Tobacco plc United Kingdom 2.2
Novartis AG Switzerland 2.2

A “weighted average” measures a characteristic by the market capitalization of each stock. Price/book ratio is the weighted average of the price/book ratios of all the stocks in a portfolio. The P/B ratio 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. The FY2 P/E ratio is a forward P/E ratio using a next-twenty-four months EPS estimate in the denominator.

Holdings are subject to change.

SECTOR WEIGHTS
Sector Fund Benchmark
Financials 20.7% 18.7%
Industrials 19.2% 11.4%
Information Technology 12.7% 10.5%
Consumer Discretionary 10.7% 12.0%
Health Care 10.3% 10.7%
Materials 9.4% 7.3%
Consumer Staples 6.8% 10.3%
Communication Services 4.0% 7.4%
Energy 3.0% 5.2%
Utilities 1.2% 3.6%
Real Estate 0.8% 3.0%
TOP 10 COUNTRIES
Country Fund Benchmark
United Kingdom 19.2% 10.2%
Germany 16.8% 5.6%
China 10.9% 10.1%
Japan 10.3% 16.1%
Switzerland 7.5% 6.4%
France 6.3% 7.4%
Taiwan 4.2% 3.4%
South Korea 3.9% 3.2%
Brazil 2.7% 1.9%
Italy 2.7% 1.6%
Regional Allocation
  • Europe – other 58.4%
  • Emerging Asia 24.4%
  • Pacific 10.2%
  • Emerging Europe, Middle East, Africa 2.5%
  • Emerging Latin America 2.4%
  • North America 1.0%

Commentary (As of April 30, 2020)

Highlights

  • After the severe shock of the COVID-19 pandemic in March and the subsequent emergency relief measures provided by monetary and fiscal authorities worldwide, global equities rebounded in April.
  • Market participants have typically anticipated the benefits (and liquidity surge) of monetary and fiscal stimulus. Equity markets’ sharp rebound in April suggests the short-term bottom of the current crisis was around March 23, when governments and central banks around the world enacted massive stimulus programs.
  • We have used the market weakness—especially the punishing of economically sensitive stocks—to buy in our view some of the developed markets' best placed and best managed companies in sectors that historically recovered the fastest from bear markets.

Portfolio attribution

Causeway International Opportunities Fund (“Fund”) outperformed the Index during the month, due primarily to stock selection. Fund holdings in the capital goods, pharmaceuticals & biotechnology, automobiles & components, food beverage & tobacco, and semiconductors & semi equipment industry groups contributed to relative performance. Holdings in the energy, materials, retailing, food & staples retailing, and insurance industry groups offset some of the outperformance versus the Index. The top contributor to return was automobile manufacturer, Volkswagen AG (Germany). Other notable contributors included robotics manufacturer, FANUC Corp. (Japan), Takeda Pharmaceutical Co., Ltd. (Japan), semiconductor company, Infineon Technologies AG (Germany), and low-budget airline, Ryanair Holdings Plc (Ireland). The largest detractor was integrated oil & gas company, Total (France). Additional notable detractors included insurance company, Aviva Plc (United Kingdom), passenger & cargo airline company, Air France-KLM SA (France), consumer retailer, Carrefour SA (France), and banking & financial services company, UniCredit S.p.A. (Italy).

We use a proprietary quantitative equity allocation model that assists the portfolio managers in determining the weight of emerging versus developed markets in the Fund. Our allocation relative to the weight of emerging markets in the Index is currently overweight. We identify five primary factors as most indicative of the ideal allocation target: valuation, quality, earnings growth, macroeconomic, and risk aversion. Valuation is currently positive for emerging markets in our model. Our quality metrics, which include such measures as profit margins and return on equity, are positive. Our earnings growth factor is positive, while our macroeconomic factor is negative for emerging markets. Lastly, our risk aversion factor is positive in our model.

Investment outlook

In past crises (such as the 1997 Asian financial crisis, the 2008-2009 Global Financial Crisis, and the 2011 European debt crisis), markets reached the bottom, and subsequently began their recovery many months before the recovery became evident in the economic data. Market participants have typically anticipated the benefits (and liquidity surge) of monetary and fiscal stimulus. Equity markets’ sharp rebound in April suggests the short-term bottom of the current crisis was around March 23, when governments and central banks around the world enacted massive stimulus programs. This crisis differs from prior periods of economic contraction in its origin: a global pandemic and government-mandated closures. For consumers and businesses alike, a sustained recovery in confidence will require effective therapies to mitigate the severity of COVID-19. Our healthcare research indicates that the development of such therapies this year is possible, with the potential for mass produced vaccines by mid- to late-2021.


We have used the market weakness—especially the punishing of economically sensitive stocks—to buy, in our view, some of the developed markets’ best placed and best managed companies in sectors that historically recovered the fastest from bear markets. We have funded this buying by reducing the portfolio’s developed market exposure to stocks in the telecommunications, health care, and consumer staples sectors, and reinvesting in companies in the industrials, financials, and information technology sectors. Investors appear to have no patience to wait for recoveries in some of these companies most negatively affected by the shutdowns, such as those in the aerospace and aviation industries, and those exposed to the travel & leisure industry. We believe that buying these stocks at such low prices relative to their normalized earnings potential will benefit the portfolio in the years ahead.

Compared to developed markets, earnings growth prospects for EM companies have been relatively resilient over the past three months. However, there is uncertainty around these analyst forecasts as earnings dispersion globally is at its highest level since the Global Financial Crisis. Within EM, all sectors are experiencing net downgrades. Cyclical sectors including energy, financials, real estate, and industrials have been the most challenged. Downgrades have been less pronounced in the more defensive sectors, including communication services, health care, and consumer staples.

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. Investing in ETFs is subject to the risks of the underlying funds. Investments in smaller companies typically exhibit higher volatility. Asset allocation may not protect against market risk. 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
2019 $0.3502 $0.0000 $0.0327
2018 $0.2904 $0.0000 $0.0327
2017 $0.2145 $0.0000 $0.0000
2016 $0.4494 $0.0000 $0.0000
2015 $0.1623 $0.0107 $0.0199
2014 $0.0000 $0.0000 $0.4943
2013 $0.1266 $0.0001 $0.0739
2012 $0.2451 $0.0000 $0.0190
2011 $0.2756 $0.0000 $0.0303
2010 $0.1858 $0.0000 $0.1712

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: