Delaware Investments Global Value Fund

Investment objective

The investment objective of Delaware Investments Global Value Fund (Fund) is to aim to achieve long-term capital appreciation. The Fund primarily invests in U.S. and non-U.S. companies, which may include companies located or operating in established or emerging countries. While the Fund may purchase securities in any country, it will primarily invest in countries in developed markets. The Fund may invest in companies of any size, but will generally invest in mid- and large-sized companies.

Philosophy

The Delaware Investments Global and International Value Equity investment team, based in Boston, Massachusetts, U.S.A., has an investment approach that is based on the concept that adversity creates opportunity and that transitory problems can be overcome by well managed companies.

Investment process

The Delaware Investments Global and International Value Equity investment team employs a six-step investment process that combines quantitative, valuation-based screening followed by comprehensive and rigorous company and industry specific research to arrive at a carefully constructed portfolio of stocks that we believe offers the most attractive investment opportunities within a three-to-five year time horizon.

Step 1. Initial market capitalisation and liquidity screens

We screen the broad investment universe for market capitalisation and the appropriate measure of liquidity.

Step 2. Quantitative valuation screen

Our valuation and ranking of stocks based on earnings, book value, cash flow, and profitability further narrows the universe.

Step 3. Universe segmentation and secondary analytics

This step helps us quickly and efficiently frame, categorize, and understand the nature of potential investment opportunities. Through secondary analytics, we examine the information behind the valuation metrics on which we’ve screened.

Step 4. In-depth fundamental analysis

In-depth analysis is performed to determine a company's underlying value and potential for future growth. Team members examine a company's earnings power, financial position, capital efficiency, overall management effectiveness, and competitive dynamics to assess its value and potential upside.

Step 5. Portfolio construction

The Fund is fully invested, equally weighted, concentrated in value, and broadly diversified by type of value, economic sector, industry, and market capitalisation. Stocks are added to the portfolio holdings based on their individual merit. The investment strategy is benchmark-aware but not benchmark-driven.

Step 6. Sell discipline

We will typically sell a holding when it reaches its target price, the investment thesis has changed or fundamentals have deteriorated. We will also trim or eliminate a position when we believe better relative value opportunities become available.

Performance as of 31 October 2018

  October1 YTD1 1 year 3 year 5 year 10 year Since inception(24/12/2007)
Delaware Investments Global Value Fund
(Class F USD (Accumulating) shares, net of fees)
-6.95% -10.77% -8.52% 1.95% 1.64% 7.09% 0.75%
MSCI World Index (net)
-7.34% -2.31% 1.16% 7.91% 6.81% 10.02% 4.40%

1. Returns for less than one year are not annualized.

The performance data quoted represent past performance; past performance may not be a reliable guide to future performance and does not guarantee future results. Investment return and principal value will fluctuate so shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted.

The MSCI World Index (net) is a free float-adjusted market capitalization weighted index designed to measure equity market performance across developed markets world-wide. It is an unmanaged index and a theoretical measure of stock-market performance rather than an actual available investment. You cannot invest directly in an index. Index “net” return approximates the minimum possible dividend reinvestment, after deduction of withholding tax at the highest possible rate.

Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.

Portfolio characteristics as of 31 October 2018

Benchmark Index: MSCI World Index (net)

  Fund Index
Weighted average P/E ratio (trailing 12 months) 14.4x 17.9x
Weighted average price/book ratio 1.8x 2.3x
Number of holdings 58 1,636
Weighted average market capitalisation (millions) $121,854 $140,388
Median market capitalisation (millions) $31,798 $9,855

Top 10 country weightings as of 31 October 2018

  Fund Index
United States 44.9% 62.3%
United Kingdom 12.4% 6.1%
Japan 11.3% 8.4%
France 7.3% 3.8%
Canada 4.3% 3.3%
Germany 3.1% 3.1%
Italy 2.2% 0.8%
Netherlands 2.0% 1.2%
South Korea 1.9% 0.0%
Hong Kong 1.8% 1.2%

The MSCI World Index (net) is a free float-adjusted market capitalization weighted index designed to measure equity market performance across developed markets world-wide. It is an unmanaged index and a theoretical measure of stock-market performance rather than an actual available investment. You cannot invest directly in an index. Index “net” return approximates the minimum possible dividend reinvestment, after deduction of withholding tax at the highest possible rate.

Ned Gray

Ned A. Gray, CFA

Senior Vice President, Chief Investment Officer — International Value Equity

Start date on the Fund: December 2007

Years of industry experience: 32

(View bio)


Portfolio holdings are as of the date noted above and are subject to change at any time. Holdings may not be representative of current or future investments and may not include the entire investment portfolio. Holdings information is made available to the public 30 calendar days after the most recent month-end for monthly holdings and 30 calendar days after the most recent quarter-end for quarterly holdings.

Holdings data is for informational purposes only, and is not intended as a recommendation, offer, or solicitation for the purchase or sale of any specific security. By accessing the portfolio holdings, you agree not to reproduce, distribute or disseminate the portfolio holdings, in whole or part. In no event shall the Macquarie Collective Funds plc or its affiliates have any liability relating to the use of the portfolio holdings.

All third-party marks cited are the property of their respective owners.

Investors should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. The prospectus and Key Investor Information Documents (KIIDs) contain this and other important information about the Fund. You can request a prospectus, fund supplement, and/or KIID free of charge by calling +353-1-483-2429, visiting delawarefunds.com/ucits/literature or by contacting your applicable local agent. Investors should read the prospectus, fund and country supplements (if applicable), and KIIDs carefully before investing or sending money.

Investing involves risk, including the possible loss of principal.

Fixed income securities and bond funds can lose value, and investors can lose principal, as interest rates rise. They also may be affected by economic conditions that hinder an issuer’s ability to make interest and principal payments on its debt.

Each Fund is exposed to the risk that a counterparty will not settle a transaction due to a credit or liquidity problem. In the case of a default, the Fund could be subject to adverse market movements while replacement transactions are executed. This may be accentuated for contracts with longer maturities, or where there are concentrated transactions with a small group of counterparties.

Interest rates are determined by factors of supply and demand in the international money markets which are influenced by macro economic factors, speculation and central bank and government intervention. Fluctuations in short-term and/or long-term interest rates may affect the value of the Shares. Fluctuations in interest rates of the currency in which the Shares are denominated and/or fluctuations in interest rates of the currency or currencies in which a Fund’s assets are denominated may affect the value of the Shares.

International investments entail risks not ordinarily associated with US investments including fluctuation in currency values, differences in accounting principles, or economic or political instability in other nations. Investing in emerging markets can be riskier than investing in established foreign markets due to increased volatility and lower trading volume.

Supranational Organisations are entities designated or supported by governments or governmental entities to promote economic development, and include the Asian Development Bank, the European Community, the European Investment Bank, the Inter-American Development Bank, the International Monetary Fund, the United Nations, the International Bank for Reconstruction and Development (“World Bank”), and the European Bank for Reconstruction and Development. These organisations have no taxing authority and are dependent upon their members for payments of interest and principal. The lending activities of such supra-national entities are limited to a percentage of their total capital (including “callable capital”) contributed by members at an entity’s call, reserves, and net income.

The Funds that invest in debt securities and hold active currency positions may be exposed to currency exchange risk. Currency exchange rates may fluctuate over short periods of time. A Fund may engage in non-U.S. currency transactions in order to hedge against currency fluctuations. Hedging transactions, while potentially reducing the currency risks to which the Fund would otherwise be exposed, involve certain other risks, including the risk of a default by a counterparty.

Non-publicly traded and Rule 144A Securities may involve a high degree of business and financial risk and may result in substantial losses. These securities may be less liquid than publicly traded securities. Although these securities may be resold in privately negotiated transactions, the prices realised from these sales could be less than those originally paid by a Fund.

Prices of derivatives may move in unexpected ways. Some derivatives are “leveraged” and may magnify or otherwise increase investment losses. A liquid secondary market may not always exist for the Funds’ derivatives positions and may not be able to be “closed out” when desired. Derivatives involve legal risk, the risk of loss due to the unexpected application of a law or regulation, or because contracts are not legally enforceable or documented correctly.

Trading in options can cause the Fund’s Net Asset Value to experience more frequent and wider fluctuations than if the Fund did not utilise options. No assurance can be given that the Funds will be able to effect closing transactions at a time when they wish to do so. The Fund may be required to hold assets that it would otherwise have sold and continue to be at market risk on such assets encurring higher transaction costs. Options that are not exchange traded will subject a Fund to risks relating to its counterparty, such as the counterparty’s bankruptcy, insolvency, or refusal to honour its contractual obligations.

Zero coupon bonds and payment-in-kind (PIK) bonds are considered to be more interest rate-sensitive and more speculative than interest-bearing bonds and may subject the Fund to adverse conditions under certain circumstances.

The Fund may also be subject to prepayment risk, the risk that the principal of a bond that is held by a portfolio will be prepaid prior to maturity, at the time when interest rates are lower than what the bond was paying. A portfolio may then have to reinvest that money at a lower interest rate.

Companies involved in Initial Public Offerings generally have limited operating histories, and prospects for future profitability are uncertain. Prices of IPOs may also be unstable because of the absence of a prior public market, the small number of shares available for trading, and limited investor information. IPOs will frequently be sold within 12 months of purchase.

Investments in small and/or medium-sized companies typically exhibit greater risk and higher volatility than larger, more established companies.

In the event of bankruptcy or other default of a borrower of portfolio securities, a Fund could experience both delays in liquidating the loan collateral or recovering the loaned securities. Possible losses include (a) decline in the value of the collateral or in the value of the securities loaned during the period which the Fund seeks to enforce its rights thereto, (b) sub-normal levels of income and lack of access to income during this period, and (c) expenses of enforcing its rights.

Fund finder

Daily pricing (as of 13/12/2018)

ClassPriceNet changeYTD
F USD (Acc.)$10.35no chg-14.89%

Class F $ Accumulating*

Currency USD
ISIN IE00B29Q9B69
Sedol B29Q9B6
CUSIP G2774C122
Bloomberg ID DLGLVFA

Fees and expenses

Management fee 1.45%
Expense ratio 1.90%

Literature

Fund documents

Visit our Literature page for Key Investor Information Documents (KIIDs).

* For information on other share classes, please contact Delaware Investments at +1 215 255-1505 or at MacquarieUCITS@macquarie.com.