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*
+11.24%
Nav*
$15.14, +0.04
Inception
October 26, 2001
Cusip
14949P208
Benchmark
MSCI EAFE
Minimum Investment
$1,000,000
Sales Charge
None
Total Expense Ratio
0.88%
*As of October 17, 2019

Strategy overview

The portfolio managers discuss our International Value 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
Fundamental Portfolio Manager

Performance

QTDYTD1 year3 years5 years10 yearsSince inception
Fund-2.3%7.9%-8.0%3.9%0.7%4.9%6.6%
MSCI EAFE-1.0%13.3%-0.8%7.0%3.8%5.4%6.1%
QTDYTD1 year3 years5 years10 yearsSince inception
Fund-2.3%7.9%-8.0%3.9%0.7%4.9%6.6%
MSCI EAFE-1.0%13.3%-0.8%7.0%3.8%5.4%6.1%
QTDYTD1 year3 years5 years10 yearsSince inception
Fund-2.3%7.9%-8.0%3.9%0.7%4.9%6.6%
MSCI EAFE-1.0%13.3%-0.8%7.0%3.8%5.4%6.1%
QTDYTD1 year3 years5 years10 yearsSince inception
Fund-2.3%7.9%-8.0%3.9%0.7%4.9%6.6%
MSCI EAFE-1.0%13.3%-0.8%7.0%3.8%5.4%6.1%
20182017201620152014201320122011201020092008200720062005200420032002
Fund-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-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
20182017201620152014201320122011201020092008200720062005200420032002
-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%
-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 September 30, 2019)

Benchmark: MSCI EAFE
Asset Allocation
Fund
Stocks97.0%
Cash3.0%
Fund Characteristics
FundBenchmark
No. of holdings 59 923
Weighted avg. market cap (US $MM)$56,403$52,797
FY2 price/earnings10.613.4
Price/book value1.21.6
Net assets$6,092,077,809-
TOP 10 HOLDINGS
Security Country Percent
Volkswagen AGGermany4.1%
Takeda Pharmaceutical Co., Ltd.Japan3.7%
BASF SEGermany3.7%
UniCredit S.p.A.Italy3.6%
ABB Ltd.Switzerland3.1%
China Mobile Ltd.China3.0%
Prudential PlcUnited Kingdom2.9%
Linde PlcGermany2.8%
Barclays PlcUnited Kingdom2.7%
British American Tobacco plcUnited Kingdom2.6%

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
Financials21.7%18.6%
Industrials17.7%14.7%
Communication Services11.1%5.4%
Health Care10.5%11.6%
Energy9.2%5.1%
Materials9.2%7.0%
Information Technology5.8%6.7%
Consumer Discretionary5.6%11.5%
Consumer Staples4.6%12.0%
Utilities1.6%3.8%
Real Estate0.0%3.6%
TOP 10 COUNTRIES
Country Fund Benchmark
United Kingdom28.4%16.4%
Germany17.2%8.5%
Japan13.7%24.6%
France6.7%11.4%
Switzerland6.7%9.4%
China5.4%0.0%
South Korea5.1%0.0%
Canada4.6%0.0%
Italy3.6%2.3%
Netherlands3.0%4.0%
Regional Allocation
  • Europe – other 68.0%
  • Pacific 13.7%
  • Emerging Asia 10.5%
  • North America 4.6%
  • Emerging Europe, Middle East, Africa 0.2%

Commentary (As of September 30, 2019)

Highlights

  • After contracting in July and August, developed equity markets rebounded in September, likely responding to a significant move upward in global bond yields. In September, momentum-driven “quality-growth” stocks ceded market leadership to stocks with strong value and cyclicality characteristics.
  • With low-to-no cost of financing, governments in Europe and elsewhere may decide to amplify fiscal spending. Without fiscal intervention, a vicious cycle of nil return in savings forces aging European and Japanese populations to save even more, adding to demand for fixed income, and pushing interest rates lower.
  • We believe our portfolios are well-positioned to benefit from a return to favor of value and cyclicality. If economically sensitive stocks outperform, we intend to use that opportunity to lower portfolio expected volatility with bargains from less cyclical sectors.

Portfolio attribution

Causeway International Value Fund (“Fund”) outperformed the Index during the month, due primarily to stock selection. Fund holdings in the banks, food beverage & tobacco, insurance, and technology hardware & equipment industry groups, as well as an underweight position in the household & personal products industry group, contributed to performance compared to the Index. Holdings in the consumer durables & apparel and food & staples retailing industry groups, along with an overweight position in the telecommunication services industry group and an underweight position in the semiconductors & semi equipment and diversified financials industry groups, detracted from relative performance. The top contributor to return was electronic equipment manufacturer, Samsung Electronics Co., Ltd.(South Korea). Other notable contributors included banking & financial services company, Barclays Plc (United Kingdom), life insurer, Prudential Plc (United Kingdom), banking & financial services company, UniCredit S.p.A. (Italy), and automobile manufacturer, Volkswagen AG (Germany). The largest detractor was pharmaceutical & consumer healthcare products producer, Novartis AG (Switzerland). Additional notable detractors included pharmaceuticals & chemicals company, Bayer AG (Germany), apparel manufacturer, Gildan Activewear (Canada), pharmaceutical & healthcare products manufacturer, Sinopharm Group Co., Ltd. (China), and internet services provider, Baidu (China).

Investment outlook

We believe that fundamentals do prevail over the long-term…it is just very difficult to know when the market will turn. September witnessed a chain reaction of cheap stocks, often in cyclical industries, attracting bargain hunting – which, in turn, attracted more buying. Stock markets have a history of discounting future events long before they occur. We suggest that most cyclical stocks priced in a recession by the end of August and are now moving upward on the hint of fiscal spending and recovery. We believe our portfolios are well-positioned to benefit from a return to favor of value and cyclicality. If economically sensitive stocks outperform, we intend to use that opportunity to lower portfolio expected volatility with bargains from less cyclical sectors. Our team has intensified efforts to get managements to commit to specific plans to improve earnings and returns on capital. While we wait, the majority of these portfolio companies return capital to shareholders, often via generous dividend payouts. This dividend income is striking in a low-income world, reducing the duration of the investment. We are holding company managements’ collective “feet to the fire,” measuring their progress and holding them accountable to their operational restructuring plans. This makes our efforts in value investing “all weather,” though a tailwind for value risk would be welcome.

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

DividendsShort-term capital gainsLong-term capital gains
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: