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*
+14.22%
Nav*
$18.55
Inception
October 26, 2001
Cusip
14949P208
Benchmark
MSCI EAFE
Minimum Investment
$1,000,000
Sales Charge
None
Net Expense Ratio
0.85%
Gross Expense Ratio
0.88%
*As of June 14, 2021
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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 5.8%13.1%53.1%6.7%8.6%5.4%7.6%
MSCI EAFE 6.6%10.4%39.0%8.7%10.3%6.4%7.0%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 5.8%13.1%53.1%6.7%8.6%5.4%7.6%
MSCI EAFE 6.6%10.4%39.0%8.7%10.3%6.4%7.0%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 6.9%6.9%65.7%4.6%8.1%5.3%7.3%
MSCI EAFE 3.6%3.6%45.2%6.5%9.4%6.0%6.7%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 6.9%6.9%65.7%4.6%8.1%5.3%7.3%
MSCI EAFE 3.6%3.6%45.2%6.5%9.4%6.0%6.7%
2020201920182017201620152014201320122011201020092008200720062005200420032002
Fund 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 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
2020201920182017201620152014201320122011201020092008200720062005200420032002
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%
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 May 31, 2021)

Benchmark: MSCI EAFE
Asset Allocation
Fund
Stocks 97.5%
Cash 2.5%
Fund Characteristics
Fund Benchmark
No. of holdings 62 844
Weighted avg. market cap (US $MM) $77,763 $65,616
FY2 price/earnings 13.0 15.3
Price/book value 1.7 1.9
Net assets $5,726,609,858 -
TOP 10 HOLDINGS
Security Country Percent
Samsung Electronics Co., Ltd. South Korea 3.8%
UniCredit S.p.A. Italy 3.8%
Rolls-Royce Holdings Plc United Kingdom 3.5%
Sanofi France 3.2%
Novartis AG Switzerland 3.2%
Amadeus IT Group SA Spain 3.2%
Takeda Pharmaceutical Co., Ltd. Japan 3.0%
Roche Holding AG Switzerland 2.9%
SAP SE Germany 2.8%
Total France 2.7%

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 20.8% 15.5%
Financials 20.7% 17.6%
Information Technology 15.3% 8.8%
Health Care 13.3% 11.9%
Consumer Staples 7.3% 10.4%
Consumer Discretionary 5.4% 13.0%
Materials 4.9% 8.0%
Utilities 4.8% 3.5%
Energy 4.8% 3.2%
Communication Services 0.2% 5.0%
Real Estate 0.0% 3.0%
TOP 10 COUNTRIES
Country Fund Benchmark
France 16.5% 11.6%
United Kingdom 16.1% 14.6%
Switzerland 12.6% 9.5%
Germany 11.3% 9.5%
Japan 9.6% 23.0%
Spain 8.3% 2.6%
Italy 6.4% 2.5%
South Korea 6.4% 0.0%
Netherlands 4.3% 4.3%
Canada 1.9% 0.0%
Regional Allocation
  • Europe – other 76.5%
  • Pacific 10.7%
  • North America 1.9%
  • Emerging Asia 7.7%
  • Emerging Latin America 0.7%

Commentary (As of April 30, 2021)

Highlights

  • The worldwide drive to stimulate economic activity and vaccinate populations added demand to equity buying in April with most major developed market indices closing at 10-year-highs.
  • With consumers beginning to unleash pent up demand, the effects of fiscal and monetary stimulus continuing to permeate the global economy, and with supply constraints intensifying, inflationary pressures are starting to emerge.
  • In asset markets awash in monetary liquidity, the price discounting mechanism has accelerated, and stock prices have reflected future good news quickly, sometimes long before earnings uplift occurs. At present, we are more interested in defensive companies that have lagged the cyclical rally.

Portfolio attribution

The Causeway International Value Fund (“Fund”) underperformed the Index during the month, due primarily to stock selection. Fund holdings in pharmaceuticals & biotechnology, semiconductors & semi equipment, banks, food beverage & tobacco, and technology hardware & equipment industry groups detracted from performance relative to the Index. Holdings in capital goods and commercial & professional services, as well as underweight positions to the automobiles & components, food & staples retailing, and telecommunication services industry groups offset a portion of the underperformance. The largest detractor from absolute performance was pharmaceutical company, Takeda Pharmaceutical Co., Ltd. (Japan). Additional top detractors included integrated oil & gas company, Total (France), travel & tourism information technology provider, Amadeus IT Group SA (Spain), and banking & financial services companies, Barclays Plc (United Kingdom) and Sumitomo Mitsui Financial Group, Inc. (Japan). The top contributor to return was business software & services provider, SAP SE (Germany). Additional top contributors included pharmaceutical giant, Sanofi (France), paints & coatings producer, Akzo Nobel (Netherlands), beverage producer, Pernod Ricard SA (France), and bank, Banco Bilbao Vizcaya Argentaria SA (Spain).

Investment outlook

Since November 2020, global equity markets have generally favored companies poised to benefit from economic reopening and recovery. As we have noted in prior reviews, cyclical sectors usually outperform market indices in periods following recessions and market lows, as earnings momentum shifts in favor of economically sensitive businesses. This cycle has fit that pattern, with extremely rapid and large increases in the share prices of cyclical companies. Within the MSCI EAFE Index, the industrials, materials, energy, consumer discretionary, and financials sectors have, on average delivered 91% absolute returns from the Covid-19 crisis market trough in March 2020 through April 2021, outperforming the other sectors in the Index by 34%. Given the rapid upward re-rating, we have responded by reducing the portfolio’s cyclical exposure and reinvesting sale proceeds into, in our view, high quality, less economically sensitive businesses with less earnings volatility. For example, we reduced significantly what had once been one of the largest-weighted holdings in client fundamental portfolios, an auto manufacturer that finally was recognized for its electric vehicle transition. After a period of strong performance, based on our analysis, its risk-adjusted expected return ranked less competitively relative to other stocks. In asset markets awash in monetary liquidity, the price discounting mechanism has accelerated, and stock prices have reflected future good news quickly, sometimes long before earnings uplift occurs. At present, we are more interested in defensive companies that have lagged the cyclical rally, including innovative pharmaceutical companies trading near all-time-low relative valuations, and forward-thinking utilities repositioning their companies for the renewable energy transition. We have also been adding to defensive information technology companies that generate recurring revenue from critical infrastructure software. The portfolio remains cyclically positioned, but we believe its lowered risk profile, diversified across risk factors, should be resilient in a broader range of market outcomes. Generally, our portfolio companies are engaged in operational restructuring. We believe we have identified companies that used the Covid-19 crisis to cut costs and boost efficiency and should emerge from the pandemic with improved earnings power and a stronger competitive positioning. We expect these companies to re-rate upward as the market recognizes their progress and look forward to increasing levels of capital returned to shareholders with dividends and 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
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: