Diversified exposure to emerging markets, capturing value and growth

The Fund normally invests at least 80% of its total assets in equity securities of companies located in emerging markets and investments that are tied economically to emerging markets, such as common stock, preferred and preference stock, depositary receipts, including American Depositary Receipts, Global Depositary Receipts, European Depositary Receipts, Swedish Depositary Receipts and other types of depositary receipts, real estate investment trusts (“REITs”) and exchange-traded funds (“ETFs”) that invest in emerging markets securities. The Investment Manager primarily invests in common stock, but will use those other security types referred to above if, for example, they provide greater liquidity, the Fund cannot access common stock through a local market, or the yield rate of preferred or preference stock is deemed favourable. Typically, less than 10% of the Fund’s Net Asset Value will be invested in ETFs, and investment in ETFs will be limited to 15% of the Fund’s Net Asset Value.

The Fund generally invests in companies with market capitalisations of US$500 million or greater at the time of investment. However, the Fund may invest in smaller market capitalisation companies if, based on the quantitative investment approach described below, it finds an attractive investment with a lower market capitalisation and sufficient liquidity. The Fund may invest in any industry or sector, but generally will not invest more than 25% of its total assets in the equity securities of companies in a single industry. Typically, the Fund will hold a diversified portfolio of over 80 equity securities.

The Investment Manager uses a quantitative investment approach to purchase and sell equity securities and those other investments as detailed above for the Fund. The Investment Manager’s quantitative investment approach uses a proprietary computer model that analyses historical financial data, or “factors,” to assist in selecting investments as detailed above. The model currently analyses factors relating to valuation, earnings growth, technical indicators (such as stock price momentum), macroeconomics, currency, countries and economic sectors, ranking companies within each factor and combining these rankings to select investments. As the Investment Manager is continually seeking to improve model performance, the factors and their weightings in the model may change over time. By ranking companies based on a combination of these factors, the Investment Manager seeks to identify a portfolio of investments that will outperform the MSCI Emerging Markets Index. In addition to its quantitative research, the Investment Manager’s fundamental research analysts review the quantitative outputs to attempt to identify and address special issues, such as significant corporate actions or management changes, which are difficult to detect quantitatively.

Please see the Prospectus and Supplement for more information. Please contact [email protected] for a Fund Application.

$ 9.83
October 19, 2016
MSCI Emerging Markets in USD
Minimum investment
Total expense ratio
*As of April 07, 2020
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Strategy overview

The portfolio managers discuss our Emerging Markets strategy.

Portfolio managers

Head of Quantitative Research
Quantitative Portfolio Manager
Quantitative Portfolio Manager
Quantitative Portfolio Manager


QTD YTD 1 year3 years Since inception
Fund -23.1%-23.1%-17.6%-4.1%-1.5%
MSCI Emerging Markets in USD -23.6%-23.6%-17.4%-1.3%0.5%
QTD YTD 1 year3 years Since inception
Fund -23.1%-23.1%-17.6%-4.1%-1.5%
MSCI Emerging Markets in USD -23.6%-23.6%-17.4%-1.3%0.5%
Fund -14.4%21.1%
MSCI Emerging Markets in USD -14.2%37.8%
Fund -14.4%21.1%
MSCI Emerging Markets in USD -14.2%37.8%

Portfolio (as of February 29, 2020)

Asset Allocation
Stocks 97.3%
Cash 2.7%
Fund Characteristics
Fund Benchmark
Holdings 128
Weighted avg. market cap (US $MM) $96,015 $0
NTM price/earnings 9.1 0.0
Price/book value 1.4 0.0
NTM EPS revision (wtd. avg.)
Net assets $1,024,049.94 -
Security Country Active weight*
China Construction Bank Corp. China 2.1%
Samsung Electronics Co., Ltd. South Korea 2.0%
Tencent Holdings Ltd. China 1.5%
Anhui Conch Cement Co., Ltd. China 1.5%
Lukoil Russia 1.4%
Investimentos Itau Brazil 1.4%
JBS SA Brazil 1.2%
Sberbank Russia 1.1%
Ping An Insurance Group Co Of China 1.0%
Hindustan Unilever Ltd. India 0.9%

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. “Earnings-per-share” is the portion of a company’s profit allocated to each outstanding share of common stock. “Earnings-per-share year-over-year estimate growth (next 12 months)” is the average next-12-months earnings-per-share estimate from one year ago for an individual company compared with that estimate today; note that this calculation is done on a company-by-company basis and is aggregated through a weighted average based on the individual company’s weight in the corresponding index. Also note that this characteristic is supplied directly by MSCI.

*Active defined as Fund weight minus MSCI EM Index weight. Holdings are subject to change.

Sector Fund Benchmark
Financials 22.7% 23.5%
Information Technology 20.1% 16.4%
Consumer Discretionary 13.2% 14.6%
Communication Services 12.7% 11.9%
Energy 8.2% 6.6%
Consumer Staples 6.0% 6.3%
Materials 5.5% 7.0%
Industrials 3.5% 5.2%
Real Estate 2.3% 2.9%
Health Care 2.1% 3.1%
Utilities 0.9% 2.5%
Country Strategy Benchmark
China 37.2% 36.4%
South Korea 13.1% 11.4%
Taiwan 12.8% 12.1%
Brazil 9.6% 6.7%
India 8.9% 8.8%
Russia 7.3% 3.6%
Thailand 1.8% 2.3%
Mexico 1.6% 2.3%
South Africa 1.1% 4.2%
Turkey 0.8% 0.5%
Regional Allocation
  • Emerging Asia 75.0%
  • Emerging Latin America 11.9%
  • Emerging Europe, Middle East, Africa 10.5%

Commentary (As of February 29, 2020)


  • In February, concerns regarding the spread of the novel coronavirus, COVID-19, weighed on global growth expectations and drove equity markets lower.
  • In addition to China, other EM countries have enacted stimulus to offset the slowdown resulting from COVID-19.
  • In the Fund, we continue to emphasize sectors with attractive valuation and earnings growth characteristics.

Portfolio Attribution

Causeway Emerging Markets UCITS Fund (“Fund”) modestly outperformed the Index in February 2020. We use both bottom-up “stock-specific” and top-down factor categories to seek to forecast alpha for the stocks in the Fund’s investable universe. Our bottom-up price momentum and earnings growth factors were positive indicators in February. While trailing significantly over the prior one-year period, our value factor was a positive indicator during the month. Our four top-down factors –macroeconomic, country, sector, and currency – were all positive indicators in February.

Investment Outlook

In the Fund, we continue to emphasize sectors with attractive valuation and earnings growth characteristics. EM earnings growth expectations relative to developed markets excluding the US have stabilized as the coronavirus spreads globally. Despite the disruptive impact of COVID-19 on the information technology (“IT”) supply chain, IT continues to be the only sector in EM that experienced net analysts' projected earnings positive upgrades over the last three months. We maintain our largest sector overweight to IT given this attractive earnings growth. The energy sector experienced the largest net earnings growth downgrades over the last three months as oil prices have cratered. We are overweight the energy sector in the Fund due to attractive valuations.

We maintain a value emphasis in our multi-factor quantitative process. The MSCI EM Value Index is trading at a wide discount to the MSCI EM Growth Index, particularly after weak performance in calendar year 2019 and over the 2020-to-date period. Using these indices’ valuations, investors are paying over twice as much for each dollar of next year’s earnings from growth stocks than they pay for earnings from value stocks, while the dividend yield for growth stocks is less than half that of value stocks. Value tends to underperform in times of uncertainty, but given these wide disparities between growth and value, as more clarity emerges on the coronavirus situation globally, we believe value factor performance will recover.

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.


Fund information: