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*
+7.70%
Nav*
$15.38, -0.05
Inception
December 31, 2009
Cusip
14949Q107
Benchmark
MSCI ACWI ex US
Minimum Investment
$1,000,000
Sales Charge
None
Net Expense Ratio
0.95%
Gross Expense Ratio
1.02%
*As of April 12, 2021
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Strategy overview

The portfolio managers discuss our International Opportunities strategy.

Portfolio managers

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

Performance

QTD YTD 1 year3 years5 years10 years Since inception
Fund 6.4%6.4%61.9%4.4%8.6%5.0%6.2%
MSCI ACWI ex US 3.6%3.6%50.0%7.0%10.3%5.4%6.1%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 6.4%6.4%61.9%4.4%8.6%5.0%6.2%
MSCI ACWI ex US 3.6%3.6%50.0%7.0%10.3%5.4%6.1%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 6.4%6.4%61.9%4.4%8.6%5.0%6.2%
MSCI ACWI ex US 3.6%3.6%50.0%7.0%10.3%5.4%6.1%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 6.4%6.4%61.9%4.4%8.6%5.0%6.2%
MSCI ACWI ex US 3.6%3.6%50.0%7.0%10.3%5.4%6.1%
20202019201820172016201520142013201220112010
Fund 5.4%21.7%-18.4%29.6%2.0%-6.1%-3.7%17.8%24.6%-12.6%15.4%
MSCI ACWI ex US 11.1%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
20202019201820172016201520142013201220112010
5.4%21.7%-18.4%29.6%2.0%-6.1%-3.7%17.8%24.6%-12.6%15.4%
11.1%22.1%-13.8%27.8%5.0%-5.3%-3.4%15.8%17.4%-13.3%11.6%

Portfolio (as of February 28, 2021)

Benchmark: MSCI ACWI ex US
Asset Allocation
Fund
Stocks 98.7%
Cash 1.3%
Fund Characteristics
Fund Benchmark
No. of holdings 159 2343
Weighted avg. market cap (US $MM) $92,619 $84,008
FY2 price/earnings 11.8 14.9
Price/book value 1.5 1.9
Net assets $245,953,778 -
TOP 10 HOLDINGS
Security Country Percent
Volkswagen AG Germany 3.1
Rolls-Royce Holdings Plc United Kingdom 2.8
Tencent Holdings Ltd. China 2.5
Taiwan Semiconductor Manufacturing Co., Ltd. - ADR Taiwan 2.4
UniCredit S.p.A. Italy 2.4
BASF SE Germany 2.3
Total France 2.3
Samsung Electronics Co., Ltd. South Korea 2.1
ING Groep NV Netherlands 2.0
Novartis AG Switzerland 2.0

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 21.2% 18.6%
Industrials 16.3% 11.5%
Information Technology 14.4% 13.0%
Consumer Discretionary 11.7% 14.0%
Health Care 9.0% 9.0%
Materials 7.0% 8.3%
Consumer Staples 6.5% 8.2%
Energy 5.2% 4.5%
Communication Services 4.1% 7.3%
Utilities 2.6% 3.1%
Real Estate 0.5% 2.6%
TOP 10 COUNTRIES
Country Fund Benchmark
France 12.8% 6.9%
Germany 12.2% 5.8%
China 12.0% 12.4%
United Kingdom 11.9% 8.9%
Switzerland 8.4% 5.7%
Japan 6.9% 15.6%
Spain 5.7% 1.5%
South Korea 5.5% 4.2%
Taiwan 5.2% 4.3%
Italy 3.7% 1.5%
Regional Allocation
  • Europe – other 59.3%
  • Emerging Asia 26.8%
  • Pacific 6.9%
  • Emerging Europe, Middle East, Africa 2.3%
  • Emerging Latin America 2.1%
  • North America 1.4%

Commentary (As of February 28, 2021)

Highlights

  • Worldwide, new Covid-19 infections dropped in February and with the vaccination rollout gathering pace, optimism for an eventual end to the pandemic drove equity markets higher.
  • Bond yields rose as market participants price in higher future growth and inflation expectations. With the lagged effect of sizable global monetary and fiscal spending, this upward pressure on long-term bond yields will likely persist.
  • We focus our fundamental research efforts on well-managed companies that have utilized this crisis to their advantage by removing significant amounts of fixed costs within operating expenses. As revenues recover, we anticipate many of these companies will achieve historically high operating margins, and this should translate into higher growth rates in earnings and cash flows.

Portfolio attribution

The Causeway International Opportunities Fund (“Fund”) outperformed the Index during the month, due primarily to stock selection. Fund holdings in the banks, transportation, capital goods, retailing, and energy industry groups contributed to outperformance relative to the Index. Holdings in the utilities industry group, along with overweight positions in the pharmaceuticals & biotechnology and technology hardware & equipment industry groups and underweight positions in the consumer durables & apparel and telecommunication services industry groups, offset a portion of the outperformance. The top contributor to return was jet engine manufacturer, Rolls-Royce Holdings Plc (United Kingdom). Other notable contributors included financial services provider, ING Groep NV (Netherlands), automobile manufacturer, Volkswagen AG (Germany), airline, Air Canada (Canada), and bank, Banco Bilbao Vizcaya Argentaria SA (Spain). The largest detractor from absolute performance was electronic components manufacturer, Murata Manufacturing Co. Ltd. (Japan). Additional detractors included electric utility provider, RWE AG (Germany), internet commerce company, Alibaba Group Holding (China), Takeda Pharmaceutical Co., Ltd. (Japan), and pharmaceutical producer, Novartis AG (Switzerland).

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 neutral. We identify five primary factors as most indicative of the ideal allocation target: valuation, quality, earnings growth, macroeconomic, and risk aversion. Valuation is currently negative 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 negative, while our macroeconomic factor is positive for emerging markets. Lastly, our risk aversion factor is negative in our model.

Investment outlook

The emphasis we have placed on high-quality developed market cyclical stocks continued to be beneficial in February. The reopening of economies globally will likely be supported, on a multi-year basis, by the greatest amount of government spending incurred since WWII. Rising bond yields should further support undervalued stocks in lieu of long-duration stocks with modest or negligible current cash flows. We focus our fundamental research efforts on well-managed companies that have utilized this crisis to their advantage by removing significant amounts of fixed costs within operating expenses. In our view, these improvements in efficiency will lead to a permanently lower cost base and thereby, improved operating leverage. As revenues recover, we anticipate many of these companies will achieve historically high operating margins, and this should translate into higher growth rates in earnings and cash flows. In particular, we expect companies experiencing the biggest drags on revenues from the pandemic—such as air travel and travel or hotel booking software—to transition from loss-making to generating substantial free cash flows. As the global population becomes vaccinated, this should stoke demand for travel and hospitality. In addition, we anticipate a resumption in dividends and share buybacks from many of our developed market portfolio companies as free cash flow rises, an important component of total return.

In the emerging markets (“EM”) portion of the Fund, earnings growth prospects are positive for many companies as growth upgrades exceeded downgrades in most sectors over the past three months. The materials, information technology, and financials sectors experienced the strongest net upgrades. Growth upgrades for these cyclically oriented sectors reflect analysts’ optimism that economic activity will continue to normalize.

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
2020 $0.1974 $0.0000 $0.0000
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: