We believe it is most helpful to evaluate past performance in context, both compared to the relevant benchmark index and peer funds.  Risk Lens does both, comparing a manager’s returns to the benchmark selected by the user; that is, “active return,” and enabling users to compare funds to competitors.  For example, Figure 1 below shows the active return of Causeway International Small Cap Fund – Institutional Class shares (CIISX) compared to the MSCI ACWI ex-USA Small Cap Index (Small Cap Index).  “5-year 5.7%” means the average annual total return of CIISX outperformed the Small Cap Index by 5.7% annually for the five years ended April 30, 2025.  We think most advisers want to see active returns as one of the key due diligence elements they evaluate.

We also know that advisers and asset managers need to compare the performance of multiple funds quickly and easily.  As shown in Figure 2 below, Risk Lens Performance Report can compare the active performance of multiple funds in easy-to-read graphs.

TS:  Two other skill measurements in Risk Lens are “downside capture” and “upside capture.”  These assess whether a manager has beaten the benchmark during down markets and up markets.

AJ:  Basically, yes.  Downside capture measures a manager’s performance in down markets.  Here, a value under 100 is good.  This indicates the manager lost less than the benchmark, net of expenses, during periods of negative returns for the benchmark.

To calculate downside capture, we take the manager’s returns each month during the specified period when the benchmark return was negative.  We calculate the arithmetic average of the returns of the manager and the benchmark during those months.  We divide the manager’s average return by the benchmark’s average return and then multiply that by 100.  An investment manager who has a downside capture less than 100 has outperformed the index during the down market.  For example, a downside capture of 75 indicates that the manager’s portfolio declined only 75% as much as the index (i.e., outperformed the index by 25%) during the period.

Conversely, upside capture measures a manager’s performance in up markets over a measurement period.  An upside capture value over 100 is good.  This means the manager outperformed the benchmark, net of expenses, during periods of positive returns for the benchmark.

To calculate upside capture, we similarly take the manager’s returns each month during the specified period when the benchmark return was positive.  We calculate the arithmetic average of the returns of the manager and the benchmark during those months.  We divide the manager’s average return by the benchmark’s average return and then multiply that by 100.

An investment manager who has an upside capture greater than 100 has outperformed the index during the up markets over the period.  For example, an upside capture of 120 indicates that the manager outperformed the market by 20% during the specified period.

Again, as illustrated in Figures 3 and 4, Risk Lens allows users to compare multiple managers’ downside capture and upside capture scores.

TS:  To further measure manager skill, Risk Lens also shows a fund’s “batting average.”  Can you discuss this metric?

AJ:  Batting average is a popular and useful measure of manager skill.  It divides the number of months in which a manager beat or matched the benchmark index by the total number of months in the period.  Just like in baseball, a manager who equaled or outperformed the benchmark every month in a given period would have a batting average of 1.000.  Meeting or beating the benchmark half the time would earn a batting average of 0.500.  Note that in Risk Lens, the manager performance used for batting average is calculated net of expenses.

Investors are looking for managers who can beat the index and generate “alpha.”  Managers with higher batting averages have more consistently beaten the index than peers with lower batting averages over a measurement period.  It’s a skill indicator, and especially useful when comparing multiple managers.  For example, the graphs in Figure 5 below illustrate Risk Lens’ Batting Average screen, showing the top five equity funds by batting average 5-year percentile compared to the Small Cap Index as of April 30, 2025.

TS:  Arjun, thank you for explaining some of Risk Lens’ key manager skill features.

Key insights

• Measuring the skill of portfolio managers is critical to building quality investment portfolios for clients. Key metrics include:

• • past performance
  • downside capture
  • upside capture
  • batting average

As discussed above, these metrics compared to benchmarks and peers are readily available in Causeway Risk Lens.

To sign up for Risk Lens, go to analytics.causewaycap.com.

Important Disclosures

About Risk Lens: Causeway manages global equities, fusing fundamental and quantitative analysis since 2001 and manages $55.2 billion (at 3/31/25). In 2013, Causeway launched Risk Lens to bring the power of its risk model to clients, introducing the easy-to-use web application in 2019. Risk Lens covers approximately 3,700 U.S.-registered equity mutual funds and ETFs, approximately 9,500 share classes, and 37 benchmarks across all major geographies.

Risk Lens is For Investment Professional Use Only – Not For Retail Distribution. See “Disclosures” in your Risk Lens reports.

IMPORTANT: The projections or other information generated by Causeway’s Risk Lens investment analysis tool regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results. The information provided by Risk Lens is for illustration only, should not be relied on as investment advice, and is not a recommendation to buy or sell any fund or security. Results may vary with each use and over time.

This commentary expresses Causeway’s views as of March 2025 and should not be relied on as research or investment advice regarding any stock. These views and any portfolio holdings and characteristics are subject to change.

To determine if a Causeway Fund is an appropriate investment for you, carefully consider the Fund’s investment objectives, risk factors, charges and expenses before investing. This and other information can be found in the downloadable full or summary fund prospectus, which may also be requested in print by calling 1-866-947-7000. Please read the full or summary prospectus carefully before you invest or send money.

The performance data quoted represents past performance. Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth less than their original cost and current performance may be lower than the performance quoted. Returns greater than one year are average annual total returns. Total returns assume reinvestment of dividends and capital gains distributions at net asset value when paid. Active return is the difference between a fund’s return and the benchmark’s return. The average annual total return as of 3/31/25 for CIISX was 5.6%, 18.0%, 7.5%, and 7.9% for the past one-year, five-year, ten-year, and since inception (10/20/14) periods, respectively. For performance as of the most recent month-end, call 1-866-947- 7000. CIISX investment performance reflects fee waivers. In the absence of such fee waivers, total return would be reduced. Total annual fund operating expenses for CIISX (Institutional Class shares) are 1.21% before and 1.10% after investment adviser fee waivers. Total annual fund operating expenses for CVISX (Investor Class shares) are 1.44% before and 1.35% after investment adviser fee waivers. The waivers are contractual and in effect until 1/31/2026. Investor Class shares charge up to a 0.25% annual shareholder service fee.

Mutual fund investing involves risk, including possible loss of principal. In addition to the normal risks associated with equity investing, international investing may involve risk of capital loss from unfavorable fluctuations in currency values, from differences in generally accepted accounting principles or from social, economic or political instability in other nations. Emerging markets involve heightened risks related to the same factors as well as increased volatility and lower trading volume. Current and future holdings are subject to risk. There is no guarantee that any securities mentioned will remain in or out of a Fund. Investments in smaller companies involve additional risks and typically exhibit higher volatility. Diversification does not prevent all investment losses.

Causeway Capital Management LLC serves as investment adviser for the Causeway Funds. The Funds are distributed by SEI Investments Distribution Co. (1 Freedom Valley Drive, Oaks, PA  19456), which is not affiliated with the Causeway Funds or the investment adviser. Check the background of SEI Investments Distribution Co. on FINRA’s BrokerCheck.

There is no guarantee that the Causeway Funds will meet their stated objectives. The Causeway Funds are available to US investors only.

The MSCI ACWI ex USA Small Cap Index, is a free float-adjusted market capitalization weighted index, designed to measure the equity market performance of developed and emerging markets excluding the U.S. market. The Index covers approximately 14% of the free float adjusted market capitalization in each country. The Index is gross of withholding taxes, assumes reinvestment of dividends and capital gains, and assumes no management, custody, transaction or other expenses. It is not possible to invest directly in an index.

MSCI has not approved, reviewed, or produced this report, makes no express or implied warranties or representations and is not liable whatsoever for any data in the report. You may not redistribute the MSCI data or use it as a basis for other indices or investment products.

Certain Risk Lens software is subject to © 2025 Causeway Capital Management LLC. All Rights Reserved.