Brandes - U.S. - Mutual Brandes Small Cap Value Fund Content

Brandes Small Cap Value Fund

The Fund seeks long-term capital appreciation by investing predominantly in U.S. equity securities of small-capitalization companies that the Fund’s investment team believes are undervalued relative to their financial strength and upside potential.

Expand Your Opportunity Set

  • Active — Company-focused with average long-term active share over 98%.*
  • Value — The fund consistently applies a disciplined investment process focused on uncovering potentially attractive value opportunities predominantly in U.S. small-cap equity securities.
  • Pioneer — Brandes has been investing in small-cap companies for over 40 years, and managing a dedicated U.S. small-cap strategy for over 20 years.

Partner with a Pioneer in Global Value Investing

  • Experienced Professionals — The Investment Committee is composed of experienced professionals who have managed extreme market cycles.
  • Commitment to Transparent, Easy to Understand Investment Process — The firm consistently applies a Graham-and-Dodd, value investing approach centered on a research-driven process of purchasing potentially undervalued companies with the goal of capturing future price appreciation.
  • Independent Point of View — Brandes Investment Partners is a 100% employee owned firm and its strategies are unhindered by sales quotas or any outside influence that may impede the firm’s pursuit of investment management excellence.

Under normal market conditions, the Small Cap Value Fund invests at least 80% of its net assets measured at the time of purchase in securities issued by small capitalization companies. The Small Cap Fund considers a company to be a small capitalization company if it has a market capitalization of $5 billion or less at the time of purchase. The Small Cap Fund invests predominantly in U.S. equity securities. Equity securities include common and preferred stocks, warrants and rights. Up to 10% of the Small Cap Fund’s total assets, measured at the time of purchase, may be invested in fixed-income securities. Up to 10% of the Small Cap Fund’s total assets, measured at the time of purchase, may be invested in securities of companies located outside of the United States. However the combined total assets, measured at the time of purchase, invested in fixed-income securities and in securities of companies located outside of the United States may not exceed 15%.

Brandes Investment Partners, L.P., the investment advisor (the “Advisor”), uses the principles of value investing to analyze and select equity securities for the Small Cap Value Fund’s investment portfolio. When buying equity securities, the Advisor assesses the estimated “intrinsic” value of a company based on data such as a company’s earnings, cash flow generation, and/or asset value of the underlying business. By choosing securities that are selling at a discount to the Advisor’s estimates of their share of the company’s intrinsic business value, the Advisor seeks to establish an opportunity for long-term capital appreciation. The Advisor may sell a security when its price reaches a target set by the Advisor, the Advisor believes that other investments are more attractive, or for other reasons.

Shareholder Fees
(fees paid directly from your investment)
   Class A    Class I    Class R6
Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) -0 5.75% -0 None -0 None
Maximum Deferred Sales Charge (Load) -0 None* -0 None -0 None
Please click here for sales load break points.

*Investments of $1 million or more are not subject to a front-end sales charge but generally will be subject to a deferred sales charge of 1.00% on amounts of less than $4 million, 0.50% on amounts of at least $4 million but less than $10 million and 0.25% on amounts of at least $10 million, if redeemed within one year from the date of purchase.
Annual Fund Operating Expenses1
(expenses that you pay each year as a % of the value of your investment)
   Class A    Class I    Class R6
Management Fees -0 0.70% -0 0.70% -0 0.70%
Distribution (rule 12b-1) Fees -0 0.25% -0 None -0 None
Other Expenses      
Shareholder Service Fees -0 None -0 None -0 None
Other Expenses -0 3.16% -0 3.21% -0 3.16%
Total Other Expenses -0 3.16% -0 3.21% -0 3.16%
       
Total Annual Fund Operating Expenses -0 4.11% -0 3.91% -0 3.86%
Less: Fee Waiver and/or Expense Reimbursement 0 -2.96% 0 -3.01% 0 -3.14%
Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement -0 1.15% -0 0.90% -0 0.72%
1 The Advisor has contractually agreed to limit the Small Cap Value Fund’s Class A, Class I and Class R6 annual operating expenses (excluding acquired fund fees and expenses, taxes, interest, brokerage commissions, expenses incurred in connection with any merger or reorganization or extraordinary expenses such as litigation), including repayment of previous waivers, to 1.15% for Class A, 0.90% for Class I and 0.72% for Class R6, as percentages of the respective Fund classes’ average daily net assets through January 31, 2019 (the “Expense Caps”). The Expense Caps may be terminated at any time by the Board of Trustees upon 60 days’ notice to the Advisor. The Advisor is permitted, with Board approval, to be reimbursed for fee reductions and/or expense payments made in the prior three years with respect to any Class of the Fund. The Advisor may request reimbursement if the aggregate amount paid by the Fund toward operating expenses for the Class for the fiscal year (taking into account the reimbursement) does not exceed the Expense Cap with respect to such Class or any lower expense cap for the Class in effect at the time of the reimbursement.

Because the values of the Fund's investments will fluctuate with market conditions, so will the value of your investment in the Fund. You could lose money on your investment in the Fund, or the Fund could underperform other investments. The values of the Fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. Investments in small and medium capitalization companies tend to have limited liquidity and greater price volatility than large capitalization companies.

One cannot invest directly in an index.

Active Share: A measure of the percentage of stock holdings in a manager’s portfolio that differ from the benchmark index.

Book/Price: Book value per share divided by price per share.

Graham and Dodd Investment Approach: A method described by Benjamin Graham and David Dodd in their 1934 book Security Analysis which seeks to identify securities that may be underpriced relative to the value of their underlying assets.   

1 Source: S&P Global Market Intelligence Capital IQ; as of 6/30/2017; small cap: $250 million to $2.5 billion; large cap: more than $5 billion.

2 Source: FactSet; from 5/7/2007 to 6/30/2017; the Russell 2000 Index represents U.S. small caps; correlations measured against the Russell 1000 for U.S. large caps, the Bloomberg Barclays U.S. Aggregate Bond Index for U.S. fixed income, the HFRI Fund Weighted Composite Index for hedge funds, the MSCI EAFE Index for non-U.S. large caps, the MSCI Emerging Markets Index for emerging market stocks and the S&P GSCI for global commodities.

3 Source:  S&P via FactSet; from 10/28/1994 to 6/30/2017; small caps represented by the S&P Small Cap 600 Index; large caps represented by the S&P 500 Index.

4 Source:  FactSet; as of 6/30/2017; based on average annual active share 2002–2016.

5 Source:  FactSet; from 12/31/1978 to 7/31/2017; small-cap growth stocks measured by the Russell 2000 Growth Index and small-cap value stocks measured by the Russell 2000 Value Index.

The Bloomberg Barclays U.S. Aggregate Bond Index is a broad-based benchmark that measures the investment-grade, U.S. dollar-denominated, fixed-rate taxable bond market. This index is a total return index which reflects the price changes and interest of each bond in the index. 

The HFRI Fund Weighted Composite Index is a global, equal-weighted index of over 2,000 single-manager funds that report to HFR Database. Constituent funds report monthly net of all fees performance in US dollar and have a minimum of $50 million under management or a twelve (12) month track record of active performance. The HFRI Fund Weighted Composite Index does not include Funds of Hedge Funds.

The MSCI EAFE Index with net dividends captures large and mid cap representation of developed market countries excluding the U.S. and Canada.  

The MSCI Emerging Markets Index with net dividends captures large and mid cap representation of emerging market countries.

The Russell 1000 Index with gross dividends measures performance of the large cap segment of the U.S. equity universe.

The Russell 2000 Index with gross dividends measures the performance of the small cap segment of the U.S. equity universe. 

The Russell 2000 Growth Index with gross dividends measures performance of the small cap segment of the U.S. equity universe. Securities are categorized as growth or value based on their relative book-to-price ratios, historical sales growth, and expected earnings growth.   

The Russell 2000 Value Index with gross dividends measures performance of the small cap segment of the U.S. equity universe. Securities are categorized as growth or value based on their relative book-to-price ratios, historical sales growth, and expected earnings growth.

The S&P 500 Index with gross dividends measures equity performance of 500 of the top companies in leading industries of the U.S. economy.

The S&P GSCI is a broad-based and production-weighted benchmark representing the global commodity market beta. 

The S&P Small Cap 600 Index measures the small-cap segment of the U.S. equity market.