Combining our time-tested abilities in developed and emerging international markets

The Fund invests primarily in companies both in developed markets excluding the United States (the “international value portfolio”) and in emerging markets (the “emerging markets portfolio”). Causeway allocates substantially all of the Fund’s assets between the international value portfolio and the emerging markets portfolio using a proprietary asset allocation model.

International Value Portfolio: The international value portfolio consists primarily of common stocks of companies located in developed countries outside the US. Normally, the majority of this portfolio invests in companies that pay dividends or repurchase their shares. The international value portfolio may also invest in companies located in emerging (less developed) markets.

Emerging Markets Portfolio: The emerging markets portfolio is normally invested in equity securities of companies located in emerging (less developed) markets and other investments that are tied economically to emerging markets. Generally, these investments include common stock, preferred and preference stock, American Depositary Receipts, European Depositary Receipts, Global Depositary Receipts, and exchange-traded funds that invest in emerging markets securities.

YTD Return*
$12.4, -0.03
December 31, 2009
Minimum Investment
Sales Charge
Net Expense Ratio
*As of June 17, 2019

Strategy overview

The portfolio managers discuss our International Opportunities strategy.

Portfolio managers

Chief Executive Officer
Fundamental Portfolio Manager
Head of Fundamental Research
Fundamental Portfolio Manager
Fundamental Portfolio Manager
Fundamental Portfolio Manager
Fundamental Portfolio Manager
Fundamental Portfolio Manager
Fundamental Portfolio Manager
Head of Quantitative Research
Quantitative Portfolio Manager
Quantitative Portfolio Manager
Quantitative Portfolio Manager
Fundamental Portfolio Manager


QTD YTD 1 year3 years5 years Since inception
Fund -3.9%5.8%-10.7%4.6%-0.2%4.4%
MSCI ACWI ex US -2.7%7.5%-5.8%7.2%1.8%4.4%
QTD YTD 1 year3 years5 years Since inception
Fund -3.9%5.8%-10.7%4.6%-0.2%4.4%
MSCI ACWI ex US -2.7%7.5%-5.8%7.2%1.8%4.4%
QTD YTD 1 year3 years5 years Since inception
Fund 10.2%10.2%-8.4%6.7%1.2%4.9%
MSCI ACWI ex US 10.4%10.4%-3.7%8.6%3.0%4.8%
QTD YTD 1 year3 years5 years Since inception
Fund 10.2%10.2%-8.4%6.7%1.2%4.9%
MSCI ACWI ex US 10.4%10.4%-3.7%8.6%3.0%4.8%
Fund -18.6%29.4%1.7%-6.3%-4.0%17.5%24.4%-12.8%15.1%
MSCI ACWI ex US -13.8%27.8%5.0%-5.3%-3.4%15.8%17.4%-13.3%11.6%

Portfolio (as of May 31, 2019)

Benchmark: MSCI ACWI ex US
Asset Allocation
Stocks 97.2%
Cash 2.8%
Fund Characteristics
Fund Benchmark
No. of holdings 204 2210
Weighted avg. market cap (US $MM) $50,239 $48,514
FY2 price/earnings 9.3 11.9
Price/book value 1.2 1.6
Net assets $9,945,695 -
Security Country Percent
Volkswagen AG Germany 3.9
Takeda Pharmaceutical Co., Ltd. Japan 3.1
Linde Plc Germany 3.1
KDDI Corp. Japan 2.7
Prudential Plc United Kingdom 2.6
ABB Ltd. Switzerland 2.4
UniCredit S.p.A. Italy 2.4
British American Tobacco plc United Kingdom 2.4
AstraZeneca Plc United Kingdom 2.2
BASF SE Germany 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 Fund Benchmark
Financials 21.7% 22.0%
Industrials 15.0% 11.8%
Materials 10.3% 7.5%
Energy 9.7% 7.3%
Health Care 9.5% 8.2%
Consumer Discretionary 8.7% 11.0%
Information Technology 7.6% 8.4%
Communication Services 6.4% 7.0%
Consumer Staples 5.3% 10.1%
Utilities 2.2% 3.3%
Real Estate 0.8% 3.3%
Country Fund Benchmark
United Kingdom 26.8% 11.5%
Japan 11.6% 16.1%
Germany 11.4% 5.8%
China 8.0% 8.6%
Switzerland 7.2% 6.0%
Canada 5.5% 6.8%
South Korea 3.7% 3.4%
France 3.7% 7.6%
India 3.0% 2.4%
Taiwan 2.9% 3.0%
Regional Allocation
  • Europe – other 54.2%
  • Emerging Asia 18.2%
  • Pacific 12.1%
  • North America 7.8%
  • Emerging Latin America 2.8%
  • Emerging Europe, Middle East, Africa 2.5%

Commentary (As of May 31, 2019)


  • Developed and emerging equity markets declined during the month as trade negotiations between the US and China deteriorated and import tariff rates increased. Stocks in industries sensitive to economic growth (cyclicals) suffered greatly during the month versus those in defensive industries.

Portfolio attribution

Causeway International Opportunities Fund ("Fund") underperformed the Index during the month, due primarily to stock selection. Fund holdings in the banks, food beverage & tobacco, insurance, utilities, and energy industry groups detracted from relative performance. Holdings in the telecommunication services industry group, as well as an overweight position in the pharmaceuticals & biotechnology industry group and an underweight position in the retailing, semiconductors & semi equipment, and media & entertainment industry groups, offset some of the underperformance. The largest detractor was banking & financial services company, UniCredit S.p.A. (Italy). Additional notable detractors included oil & natural gas producer, Encana (Canada), diversified chemicals manufacturer, BASF SE (Germany), life insurer, Prudential Plc (United Kingdom), and automobile manufacturer, Volkswagen AG (Germany). The top contributor to return was telecommunication services provider, KDDI Corp. (Japan). Other notable contributors included energy company, Gazprom PJSC - ADR (Russia), pharmaceutical & consumer healthcare products producer, Novartis AG (Switzerland), multinational food processing company, JBS SA (Brazil), and industrial gas company, Linde Plc (Germany).

We use a proprietary quantitative equity allocation model that assists the portfolio managers in determining the weight of emerging versus developed markets in the Fund. Our allocation relative to the weight of emerging markets in the Index is currently underweight. We identify five primary factors as most indicative of the ideal allocation target: valuation, quality, earnings growth, macroeconomic, and risk aversion. Valuation is currently neutral for emerging markets in our model. Our quality metrics, which include such measures as profit margins and return on equity, are negative. Our earnings growth and macroeconomic factors are negative for emerging markets. Lastly, our risk aversion factor is negative in our model.

Investment outlook

The anticipated “quality and safety” associated with economically defensive stocks attracted even more buying in May, stretching the valuation premium of defensive stocks compared to cyclical stocks to near historic highs. We believe the undervaluation in many of these cyclical industries such as US and European banks, global oil and gas, global industrials, consumer discretionary, and materials seems extreme, as our analysis indicates the valuations already discount recessionary economic conditions. In May, in particular, trade tensions have amplified risk aversion. And trade relief should do just the opposite, which would likely drive up bond yields and attract investors back to undervalued stocks. However, our price targets do not depend on economic recovery. To the degree managements of our developed market portfolio companies succeed in making significant operational improvements, their equity valuations should benefit and become less macroeconomic dependent. The value style does not rely on an economic environment; it tends to outperform growth when interest rates rise. Although we would welcome a value tailwind, we aim to build a portfolio that seeks to outperform even if investors crowd into long duration, growth equities. We have a preference for companies able to reward shareholder patience with dividends and share buybacks.

In the emerging markets portion of the Fund, our price momentum factor has rebounded in April and May after underperforming in recent quarters. Momentum’s strong performance in May was primarily attributable to defensive positioning as lower volatility stocks outperformed amid global equity market turbulence. Our momentum factor has tended to underperform during periods of heightened uncertainty in financial markets. A lack of clarity surrounding trade tensions, Fed policy, and global growth have contributed to momentum’s underperformance over the past 12 months. While we are researching the factor’s efficacy, we are encouraged that momentum continued to provide a hedge against value, our largest factor exposure.

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. Investing in ETFs is subject to the risks of the underlying funds. Investments in smaller companies typically exhibit higher volatility. Asset allocation may not protect against market risk.


Dividends Short-term capital gains Long-term capital gains
2018 $0.2580 $0.0000 $0.0327
2017 $0.1923 $0.0000 $0.0000
2016 $0.4245 $0.0000 $0.0000
2015 $0.1357 $0.0107 $0.0199
2014 $0.0000 $0.0000 $0.4943
2013 $0.0958 $0.0001 $0.0739
2012 $0.2215 $0.0000 $0.0190
2011 $0.2487 $0.0000 $0.0303
2010 $0.1712 $0.0000 $0.1712

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).


Fund information: