Seeking value primarily in the non-US developed markets

The Fund invests primarily in common stocks of companies in developed countries outside the US. Normally, the Fund invests at least 80% of its total assets in stocks of companies in a number of foreign countries and invests the majority of its total assets in companies that pay dividends or repurchase their shares. The Fund may invest up to 15% of its total assets in companies in emerging (less developed) markets.

YTD Return*
+11.86%
Nav*
$17.82, -0.06
Inception
October 26, 2001
Cusip
14949P208
Benchmark
MSCI EAFE
Minimum Investment
$1,000,000
Sales Charge
None
Net Expense Ratio
0.87%
Gross Expense Ratio
0.91%
*As of February 02, 2023
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Strategy overview

The portfolio managers discuss our International Value strategy.

Portfolio managers

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

Performance

QTD YTD 1 year3 years5 years10 years Since inception
Fund 11.2%11.2%1.4%7.9%2.4%5.1%6.9%
MSCI EAFE 8.1%8.1%-2.3%4.7%2.6%5.4%6.1%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 11.2%11.2%1.4%7.9%2.4%5.1%6.9%
MSCI EAFE 8.1%8.1%-2.3%4.7%2.6%5.4%6.1%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 22.8%-6.8%-6.8%2.3%0.9%4.2%6.4%
MSCI EAFE 17.4%-14.0%-14.0%1.3%2.0%5.2%5.8%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 22.8%-6.8%-6.8%2.3%0.9%4.2%6.4%
MSCI EAFE 17.4%-14.0%-14.0%1.3%2.0%5.2%5.8%
202220212020201920182017201620152014201320122011201020092008200720062005200420032002
Fund -6.8%9.1%5.4%20.1%-18.6%27.2%0.4%-3.0%-6.2%24.2%24.5%-10.6%12.3%32.3%-41.9%7.9%26.1%8.1%26.6%45.9%-10.9%
MSCI EAFE -14.0%11.8%8.3%22.7%-13.4%25.6%1.5%-0.4%-4.5%23.3%17.9%-11.7%8.2%32.5%-43.1%11.6%26.9%14.0%20.7%39.2%-15.7%
Fund
MSCI EAFE
202220212020201920182017201620152014201320122011201020092008200720062005200420032002
-6.8%9.1%5.4%20.1%-18.6%27.2%0.4%-3.0%-6.2%24.2%24.5%-10.6%12.3%32.3%-41.9%7.9%26.1%8.1%26.6%45.9%-10.9%
-14.0%11.8%8.3%22.7%-13.4%25.6%1.5%-0.4%-4.5%23.3%17.9%-11.7%8.2%32.5%-43.1%11.6%26.9%14.0%20.7%39.2%-15.7%

Portfolio (as of December 31, 2022)

Benchmark: MSCI EAFE
Asset Allocation
Fund
Stocks 98.3%
Cash 1.7%
Fund Characteristics
Fund Benchmark
No. of holdings 63 796
Weighted avg. market cap (US $MM) $61,605 $66,159
FY2 price/earnings 12.0 11.9
Price/book value 1.7 1.6
Net assets $6,110,643,441 -
TOP 10 HOLDINGS
Security Country Percent
UniCredit S.p.A. Italy 3.8%
Prudential Plc United Kingdom 3.8%
Rolls-Royce Holdings Plc United Kingdom 3.7%
Enel SpA Italy 3.2%
Reckitt Benckiser Group United Kingdom 3.0%
FANUC Corp. Japan 2.8%
SAP SE Germany 2.8%
Samsung Electronics Co., Ltd. South Korea 2.8%
Danone France 2.5%
Amadeus IT Group SA Spain 2.5%

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
Industrials 18.2% 15.1%
Financials 17.8% 18.7%
Health Care 15.1% 13.6%
Consumer Staples 12.6% 10.5%
Information Technology 11.3% 7.8%
Consumer Discretionary 7.7% 11.1%
Utilities 5.7% 3.5%
Materials 5.7% 7.8%
Communication Services 2.2% 4.5%
Energy 2.0% 5.0%
Real Estate 0.0% 2.6%
TOP 10 COUNTRIES
Country Fund Benchmark
United Kingdom 26.9% 15.3%
France 16.5% 11.8%
Japan 8.5% 21.9%
Germany 7.7% 8.2%
Italy 7.0% 2.3%
Spain 6.8% 2.4%
Switzerland 6.2% 10.1%
Netherlands 5.7% 4.3%
South Korea 3.9% 0.0%
Canada 2.6% 0.0%
Regional Allocation
  • Europe – other 81.0%
  • Pacific 13.7%
  • North America 2.6%
  • Emerging Asia 1.0%
  • Emerging Latin America 0.1%

Commentary (As of December 31, 2022)

Highlights

  • International equity markets rose sharply in the fourth quarter, on easing inflation concerns and optimism for China’s continued reopening. Boosted by a weaker dollar, December’s returns were positive, although comparatively modest, tempered by disappointing economic data and rising bond yields.
  • Recession in major world economies is emerging as a top concern for the coming year. Inflationary pressures should abate in the next few quarters, responding to the delayed impact of rising interest rates in most major economies globally. Re-opening of the Chinese economy should offset some of the global growth headwinds.
  • Lower valuations and relatively greater cyclicality in non-US equity markets should give non-US markets a chance to again outperform the US. As economies slow, we expect to reduce the portfolio’s lower-ranked defensive stocks to add more, in our view, competitively well-placed cyclical companies with the potential to improve free cash flow and return more capital to shareholders. We remain focused on identifying management teams able to increase free cash flow, boost dividends and reward shareholders with cash or share buybacks.

Portfolio attribution

The Causeway International Value Fund (“Fund”), on a net asset value basis, modestly underperformed the Index during the month. On a gross return basis, fund holdings in the consumer services, insurance, and banks industry groups contributed to relative performance. Holdings in the household & personal products and transportation industry groups, along with an overweight position in the technology hardware & equipment industry group, offset some of the outperformance compared to the Index. The top individual contributors to return were insurer, Prudential plc (United Kingdom), integrated resort developer & operator, Sands China (Hong Kong), and bank, Sumitomo Mitsui Financial Group, Inc. (Japan). The top individual detractors from return were electronic equipment manufacturer, Samsung Electronics Co., Ltd. (South Korea), pharmaceuticals & chemicals company, Bayer AG (Germany), and business software & services provider, SAP SE (Germany).

Investment outlook

Weak earnings and a drain of global liquidity – the opposite of the post-GFC bull market - do not bode well for equity markets in the next several months. We anticipate margins coming under pressures as higher costs flow through income statements. Nominal revenue growth may remain elevated, but real earnings growth in certain sectors appears vulnerable in our view. Lower valuations and relatively greater cyclicality in non-US equity markets should give non-US markets a chance to again outperform the US. Attractively valued cyclical stocks may deliver relatively good returns in the second half of 2023 as global markets discount post-recession recovery. Further monetary tightening should favor stocks with reasonable valuations and abundant financial strength over those where earnings expectations and multiples still appear too high. Barring another oil supply shock, we believe energy is unlikely to lead the markets to the same extent as in 2022 as global oil & gas demand –besides China – wanes. The end of the era of free money combined with sharply rising short-term interest rates may expose weaknesses in the global financial system. We have reduced our bank weighting and added to economically defensive stocks, which should reduce portfolio risk at the margin. As economies slow, we expect to reduce the portfolio’s lower-ranked defensive stocks to add more, in our view, competitively well-placed cyclical companies with the potential to improve free cash flow and return more capital to shareholders. We remain focused on identifying management teams able to increase free cash flow, boost dividends and reward shareholders with cash or share buybacks.

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. A company may reduce or eliminate its dividend, causing losses to a fund. 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
2022 $0.2834 $0.0000 $0.0000
2021 $0.3170 $0.0000 $0.0000
2020 $0.2231 $0.0000 $0.0000
2019 $0.4953 $0.0497 $0.1781
2018 $0.3750 $0.0000 $0.1083
2017 $0.3165 $0.0000 $0.0000
2016 $0.2901 $0.0000 $0.0000
2015 $0.2750 $0.0000 $0.0000
2014 $0.3788 $0.0000 $0.0000
2013 $0.1645 $0.0000 $0.0000
2012 $0.2757 $0.0000 $0.0000
2011 $0.3813 $0.0000 $0.0000
2010 $0.1939 $0.0000 $0.0000
2009 $0.1875 $0.0000 $0.0000
2008 $0.5135 $0.0000 $0.4558
2007 $0.4536 $0.6606 $3.3443
2006 $0.2289 $0.0222 $0.8650
2005 $0.3718 $0.1962 $0.3833
2004 $0.2647 $0.1379 $0.3093
2003 $0.1813 $0.0037 $0.0550
2002 $0.1196 $0.0000 $0.0000
2001 $0.0000 $0.0000 $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: