Seeking value primarily in developed markets worldwide

The global value portfolio is constructed from an equity universe composed of companies with market capitalizations typically greater than $1 billion located throughout the global developed and emerging market countries. Through rigorous, bottom-up company analysis, we seek to identify undervalued stocks with upside potential. The investment process comprises three stages: quantitative screening and initial analysis, fundamental research and portfolio construction.

Benchmark
MSCI ACWI
Inception
September 30, 2001
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Strategy overview

The portfolio managers discuss our Global 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
Strategy (gross) -2.2%3.9%15.7%6.9%9.6%7.5%10.4%
Strategy (net) -2.3%3.7%15.2%6.4%9.1%7.0%9.7%
MSCI ACWI -3.3%4.8%18.0%4.8%10.0%8.7%8.2%
QTD YTD 1 year3 years5 years10 years Since inception
Strategy (gross) -2.2%3.9%15.7%6.9%9.6%7.5%10.4%
Strategy (net) -2.3%3.7%15.2%6.4%9.1%7.0%9.7%
MSCI ACWI -3.3%4.8%18.0%4.8%10.0%8.7%8.2%
QTD YTD 1 year3 years5 years10 years Since inception
Strategy (gross) 6.2%6.2%21.6%8.7%10.6%7.7%10.5%
Strategy (net) 6.1%6.1%21.1%8.2%10.1%7.2%9.9%
MSCI ACWI 8.3%8.3%23.8%7.5%11.5%9.2%8.4%
QTD YTD 1 year3 years5 years10 years Since inception
Strategy (gross) 6.2%6.2%21.6%8.7%10.6%7.7%10.5%
Strategy (net) 6.1%6.1%21.1%8.2%10.1%7.2%9.9%
MSCI ACWI 8.3%8.3%23.8%7.5%11.5%9.2%8.4%
Fund 202320222021202020192018201720162015201420132012201120102009
Strategy (gross) 30.3%-12.7%18.0%4.9%23.0%-10.0%18.8%8.7%-5.4%7.1%31.8%18.3%-0.2%19.8%41.7%
Strategy (net) 29.8%-13.1%17.4%4.4%22.4%-10.4%18.3%8.2%-5.8%6.7%31.2%17.4%-1.1%18.8%40.5%
MSCI ACWI 22.8%-18.0%19.0%16.8%27.3%-8.9%24.6%8.5%-1.8%4.7%23.4%16.8%-6.9%13.2%35.4%
Strategy (gross)
Strategy (net)
MSCI ACWI
202320222021202020192018201720162015201420132012201120102009
30.3%-12.7%18.0%4.9%23.0%-10.0%18.8%8.7%-5.4%7.1%31.8%18.3%-0.2%19.8%41.7%
29.8%-13.1%17.4%4.4%22.4%-10.4%18.3%8.2%-5.8%6.7%31.2%17.4%-1.1%18.8%40.5%
22.8%-18.0%19.0%16.8%27.3%-8.9%24.6%8.5%-1.8%4.7%23.4%16.8%-6.9%13.2%35.4%

Portfolio (as of April 30, 2024)

Benchmark: MSCI ACWI
Asset Allocation
Strategy
Stocks 98.6%
Cash 1.4%
Strategy Characteristics
Strategy Benchmark
No. of holdings 53 2840
Weighted avg. market cap (US $MM) $124,101 $449,596
FY2 price/earnings 12.1 15.8
Price/book value 1.8 3.0
Dividend yield (%) 2.1 2.0
TOP 10 HOLDINGS
Security Country Percent
Rolls-Royce Holdings Plc United Kingdom 4.8%
Samsung Electronics Co., Ltd. South Korea 3.8%
Alphabet, Inc. United States 3.5%
Shell United Kingdom 3.5%
Barclays PLC United Kingdom 3.2%
The Walt Disney Co. United States 2.8%
TD SYNNEX Corp. United States 2.8%
Alstom SA France 2.4%
Prudential Plc United Kingdom 2.3%
Zebra Technologies Corp. United States 2.2%

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 Strategy Benchmark
Information Technology 28.5% 23.2%
Industrials 11.4% 10.9%
Financials 10.3% 16.1%
Communication Services 9.9% 7.7%
Health Care 9.7% 11.1%
Consumer Staples 6.2% 6.6%
Energy 5.7% 4.7%
Materials 5.3% 4.3%
Consumer Discretionary 4.8% 10.8%
Utilities 4.7% 2.6%
Real Estate 2.1% 2.1%
TOP 10 COUNTRIES
Country Strategy Benchmark
United States 43.5% 63.3%
United Kingdom 23.0% 3.6%
Japan 6.4% 5.4%
France 5.5% 2.9%
Germany 4.3% 2.0%
South Korea 4.2% 1.3%
Netherlands 2.8% 1.2%
Italy 2.8% 0.7%
Canada 2.0% 2.8%
Switzerland 1.9% 2.2%
Regional Allocation
  • North America 45.5%
  • Europe – other 40.3%
  • Pacific 11.1%
  • Emerging Asia 1.6%
  • Emerging Latin America 0.0%

Commentary (As of April 30, 2024)

Highlights

  • After posting strong gains in the first quarter of 2024, developed equity markets pulled back in April. Emerging markets outperformed developed, appreciating over the month.
  • European equities, on a sector-neutral basis, are trading at valuation discounts to the US not seen since sovereign debt concerns roiled the region in 2011. We are increasing exposure to well-vetted European-listed stocks across various sectors, including information technology, materials, industrials, and consumer discretionary.
  • We continue to identify companies we believe are creating value in their businesses through operational restructuring. Conservative assumptions and our interactions with company managements build our conviction in the share price upside from strengthening underearning businesses, generating more cash flow, and increasing profitability.

Portfolio Attribution

The Portfolio outperformed the Index during the month, due primarily to country allocation (a byproduct of our bottom-up stock selection process). Portfolio holdings in the health care equipment & services, banks, and semiconductors & semi equipment industry groups contributed to relative performance. Holdings in the materials, consumer services, and consumer durables & apparel industry groups offset some of the outperformance compared to the Index. The top contributor to return was technology conglomerate, Alphabet, Inc. (United States). Other notable contributors included banking & financial services company, Barclays PLC (United Kingdom), and healthcare equipment & services provider, Koninklijke Philips NV (Netherlands). The largest detractor was electronic equipment manufacturer, Samsung Electronics Co., Ltd. (South Korea). Additional notable detractors included media & entertainment conglomerate, The Walt Disney Co. (United States), and rail operator, Canadian Pacific Kansas City Ltd. (Canada).

Quarterly Investment Outlook

European equities, on a sector-neutral basis, are trading at valuation discounts to the US not seen since sovereign debt concerns roiled the region in 2011. We are increasing exposure to well-vetted European-listed stocks across various sectors, including information technology, materials, industrials, and consumer discretionary. Valuations in Japan have risen, catalyzed by earnings upgrades in certain export-related industries, capital inflows redirected away from Chinese markets, and optimism for improving corporate governance. Causeway’s investment team remains focused on identifying long-term winners in Japan’s efforts to improve shareholder returns, conducting more than ten research trips there over the past three quarters. However, the long-term challenges persist, namely, delivering consistently improving returns on capital.

We continue to identify companies we believe are creating value in their businesses through operational restructuring. Conservative assumptions and our interactions with company managements build our conviction in the share price upside from strengthening underearning businesses, generating more cash flow, and increasing profitability. In our clients' fundamental portfolios, we aim to balance these restructuring holdings with competitively positioned companies, such as those operating in oligopolistic markets with sustained pricing power, trading at reasonable valuations. Given positive real interest rates in most regions, dividends and buybacks currently are an especially meaningful component of total return. Though we reduced client exposure to banks during the quarter, we hold those with the highest risk-adjusted returns and anticipate portfolios should continue to benefit from their capital return programs. Positive real interest rates should continue to support our value investment style underpinned by our rigorous fundamental research.

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 portfolio holdings and characteristics are subject to change. There is no guarantee that any forecasts made will come to pass. The securities identified and described above 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. Past performance does not guarantee future results. For a description of our performance attribution methodology, or to obtain a list showing every holding's contribution to the overall account's performance during the quarter, please contact our product manager, Kevin Moutes, at 310-231-6116 or [email protected].