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*
-17.47%
Nav*
$12.8, -0.24
Inception
October 26, 2001
Cusip
14949P109
Benchmark
MSCI EAFE
Minimum Investment
$5,000
Sales Charge
None
Net Expense Ratio
1.10%
Gross Expense Ratio
1.15%
*As of July 09, 2020
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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

Performance

QTD YTD 1 year3 years5 years10 years Since inception
Fund 20.5%-18.1%-11.0%-3.6%-1.3%4.7%5.6%
MSCI EAFE 15.1%-11.1%-4.7%1.3%2.5%6.2%5.7%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 20.5%-18.1%-11.0%-3.6%-1.3%4.7%5.6%
MSCI EAFE 15.1%-11.1%-4.7%1.3%2.5%6.2%5.7%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 20.5%-18.1%-11.0%-3.6%-1.3%4.7%5.6%
MSCI EAFE 15.1%-11.1%-4.7%1.3%2.5%6.2%5.7%
QTD YTD 1 year3 years5 years10 years Since inception
Fund 20.5%-18.1%-11.0%-3.6%-1.3%4.7%5.6%
MSCI EAFE 15.1%-11.1%-4.7%1.3%2.5%6.2%5.7%
201920182017201620152014201320122011201020092008200720062005200420032002
Fund 19.8%-18.8%27.1%0.2%-3.2%-6.5%23.9%24.2%-10.8%12.0%32.0%-42.1%7.6%25.7%7.9%26.3%45.5%-11.2%
MSCI EAFE 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
201920182017201620152014201320122011201020092008200720062005200420032002
19.8%-18.8%27.1%0.2%-3.2%-6.5%23.9%24.2%-10.8%12.0%32.0%-42.1%7.6%25.7%7.9%26.3%45.5%-11.2%
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 June 30, 2020)

Benchmark: MSCI EAFE
Asset Allocation
Fund
Stocks 97.6%
Cash 2.4%
Fund Characteristics
Fund Benchmark
No. of holdings 66 902
Weighted avg. market cap (US $MM) $55,123 $52,799
FY2 price/earnings 11.9 15.1
Price/book value 1.0 1.5
Net assets $397,477,899 -
TOP 10 HOLDINGS
Security Country Percent
Volkswagen AG Germany 4.5%
UniCredit S.p.A. Italy 3.8%
BASF SE Germany 3.7%
ABB Ltd. Switzerland 3.3%
Siemens AG Germany 3.1%
Samsung Electronics Co., Ltd. South Korea 2.9%
Novartis AG Switzerland 2.9%
FANUC Corp. Japan 2.8%
Takeda Pharmaceutical Co., Ltd. Japan 2.7%
British American Tobacco plc United Kingdom 2.6%

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
Industrials 23.3% 14.5%
Financials 20.4% 16.1%
Health Care 11.2% 14.5%
Information Technology 10.7% 8.3%
Materials 8.6% 7.3%
Consumer Discretionary 8.3% 11.3%
Consumer Staples 5.6% 12.0%
Communication Services 5.4% 5.4%
Energy 2.8% 3.4%
Utilities 1.4% 4.0%
Real Estate 0.0% 3.2%
TOP 10 COUNTRIES
Country Fund Benchmark
Germany 23.8% 9.3%
United Kingdom 20.4% 14.1%
Switzerland 9.7% 10.3%
France 9.6% 10.9%
Japan 9.4% 25.4%
Netherlands 5.0% 4.3%
Italy 4.5% 2.3%
Spain 4.2% 2.4%
South Korea 4.0% 0.0%
China 2.9% 0.0%
Regional Allocation
  • Europe – other 80.5%
  • Pacific 9.4%
  • Emerging Asia 7.1%
  • Emerging Latin America 0.6%

Commentary (As of May 31, 2020)

Highlights

  • Equity markets continued to rally in May, likely responding to massive monetary and fiscal stimulus. Investor bias in favor of growth stocks persisted with the MSCI EAFE Growth Index outpacing the MSCI EAFE Value Index for the fifth month in a row. We anticipate a pickup in global economic activity as countries gradually relax COVID-19 pandemic lockdown measures.
  • Though global fiscal and monetary authorities’ quick action to cushion the economic blow is encouraging, stimulus should end later this year. In the next several months, we expect the private sector in most regions to resume hiring, tap bank credit for resumption of operations, and boost capital expenditures. We believe these actions are likely to push up prices, potentially mitigating the deflationary impact of the lockdowns and lower oil prices.
  • The intense market dislocation resulting from the pandemic afforded us the rare opportunity to purchase portfolio companies exhibiting, in our view, extreme undervaluation, recovery potential in earnings and cash flow growth, and quality characteristics such as talented management, defensible market position, and financial strength.

Portfolio attribution

Causeway International Value Fund (“Fund”) modestly outperformed the Index during the month, due primarily to country allocation (a byproduct of our bottom-up stock selection process). Fund holdings in the banks, semiconductors & semi equipment, telecommunication services, and transportation industry groups, as well as an underweight position in the real estate industry group, contributed to relative performance. Holdings in the capital goods, technology hardware & equipment, and consumer durables & apparel industry groups, along with an underweight position in the retailing and health care equipment & services industry groups, offset some of the outperformance versus the Index. The top contributor to return was industrial conglomerate, Siemens AG (Germany). Other notable contributors included banking & financial services company, UniCredit S.p.A. (Italy), financial services provider, ING Groep NV (Netherlands), banking & financial services company, BNP Paribas SA (France), and low-budget airline, Ryanair Holdings - ADR (Ireland). The largest detractor was jet engine manufacturer, Rolls-Royce Holdings Plc (United Kingdom). Additional notable detractors included life insurer, Prudential Plc (United Kingdom), mobile telecommunications operator, China Mobile Ltd. (China), passenger & cargo airline company, Air France-KLM SA (France), and civil construction company, Balfour Beatty Plc (United Kingdom).

Investment outlook

The speed and magnitude of stimulus from global central banks and governments has likely allowed investors a potential economic recovery. Market volatility remains high (relative to early February, before the acceleration of the pandemic), as the path to widely available COVID-19 therapies and vaccines remains unclear. Against this backdrop, we have increased our exposure to companies in the most severely impacted segments of the market (such as banks, transportation, and capital goods) that we believe boast superior balance sheet strength and liquidity positions to withstand the downturn in revenues. We also deployed capital to growth-oriented cyclical stocks—largely in the technology sector—that currently trade at undemanding valuations. The intense market dislocation resulting from the pandemic afforded us the rare opportunity to purchase portfolio companies exhibiting, in our view, extreme undervaluation, recovery potential in earnings and cash flow growth, and quality characteristics such as talented management, defensible market position, and financial strength. Based on the last three market cycles, and the recent recovery in markets from the late March 2020 lows, we are convinced that cyclical sectors will –once again –outperform the more defensive areas of the market. We believe that this crisis has brought the extraordinary occasion to own, what in our opinion, are some of the best positioned cyclical companies in materials, consumer discretionary, industrials (especially capital goods), and financials. The potential for a resumption in dividend payouts, from a wide array of companies we believe, should add another important component to total return.

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
2019 $0.4569 $0.0497 $0.1781
2018 $0.3394 $0.0000 $0.1083
2017 $0.2972 $0.0000 $0.0000
2016 $0.2619 $0.0000 $0.0000
2015 $0.2382 $0.0000 $0.0000
2014 $0.3395 $0.0000 $0.0000
2013 $0.1315 $0.0000 $0.0000
2012 $0.2502 $0.0000 $0.0000
2011 $0.3540 $0.0000 $0.0000
2010 $0.1625 $0.0000 $0.0000
2009 $0.1672 $0.0000 $0.0000
2008 $0.4799 $0.0000 $0.4558
2007 $0.4051 $0.6606 $3.3443
2006 $0.1856 $0.0222 $0.8650
2005 $0.3366 $0.1962 $0.3833
2004 $0.2380 $0.1379 $0.3093
2003 $0.1618 $0.0037 $0.0550
2002 $0.1068 $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: