SICAV

Global Value Equity Fund

Targeting attractively valued global companies with prospects for improving earnings growth.

ISIN LU0859255472 WKN A1T64M

3YR Return Annualised
(View Total Returns)

Total Assets
(USD)

1.10%
$48.2m

1YR Return
(View Total Returns)

Manager Tenure

-0.16%
7yrs

Information Ratio
(5 Years)

Tracking Error
(5 Years)

-1.21
3.41%

Inception Date 28-Nov-2012

Performance figures calculated in USD

Other Literature

30-Sep-2020 - Sebastien Mallet, Portfolio Manager,
Although value equities have experienced some short-lived rallies, growth stocks continued their long track record of outperformance. As we look toward a potential recovery period over the next 12–18 months, this could provide a positive backdrop for value investing. Any change in the market’s longer-term prognosis for inflation and interest rates should similarly be very supportive.
Sebastien Mallet
Sebastien Mallet, Portfolio Manager

Sebastien Mallet is a portfolio manager in the Equity Division at T. Rowe Price, managing the Institutional Global Value Strategy. Mr. Mallet is a vice president of T. Rowe Price Group, Inc. and T. Rowe Price International Ltd.

 

Strategy

Investment Objective

To increase the value of its shares, over the long term, through growth in the value of its investments. The fund invests mainly in a widely diversified portfolio of undervalued stocks of companies anywhere in the world, including emerging markets.

Investment Approach

  • Diversified portfolio investing in companies located throughout the globe.
  • Emphasize attractively valued companies with prospects for improving earnings growth.
  • Employ rigorous and comprehensive research to identify and assess investment opportunities.
  • Allocate country and sector positions through consideration of:
    • Attractiveness of individual investments
    • Macroeconomic environment

Portfolio Construction

  • Typically 80-100 stock portfolio
  • Individual positions typically range from 0.30% to 3.00% — average position size of 1.00%
  • Country and sector weights generally range +/- 15% deviation from the benchmark
  • Maximum of 10% in emerging markets
  • Reserves range from 0% to 10%

Performance (Class I)

Annualised Performance

  1 YR 3 YR
Annualised
5 YR
Annualised
Since Inception
Annualised
Since Manager Inception
Annualised
Fund % -0.16% 1.10% 6.35% 8.18% 8.18%
Indicative Benchmark % 10.41% 7.74% 10.48% 10.01% 10.01%
Excess Return % -10.57% -6.64% -4.13% -1.83% -1.83%

Inception Date 28-Nov-2012

Manager Inception Date 28-Nov-2012

Indicative Benchmark: MSCI World Index Net

Data as of  30-Sep-2020

Performance figures calculated in USD

  1 YR 3 YR
Annualised
5 YR
Annualised
Since Inception
Annualised
Fund % -0.16% 1.10% 6.35% 8.18%
Indicative Benchmark % 10.41% 7.74% 10.48% 10.01%
Excess Return % -10.57% -6.64% -4.13% -1.83%

Inception Date 28-Nov-2012

Indicative Benchmark: MSCI World Index Net

Data as of  30-Sep-2020

Performance figures calculated in USD

Recent Performance

  Month to DateData as of 28-Oct-2020 Quarter to DateData as of 28-Oct-2020 Year to DateData as of 28-Oct-2020 1 MonthData as of 30-Sep-2020 3 MonthsData as of 30-Sep-2020
Fund % -1.08% -1.08% -8.72% -3.24% 6.87%
Indicative Benchmark % -2.50% -2.50% -0.84% -3.45% 7.93%
Excess Return % 1.42% 1.42% -7.88% 0.21% -1.06%

Inception Date 28-Nov-2012

Indicative Benchmark: MSCI World Index Net

Indicative Benchmark: MSCI World Index Net

Performance figures calculated in USD

Past performance is not a reliable indicator of future performance.  Source for fund performance: T. Rowe Price. Fund performance is calculated using the official NAV with dividends reinvested, if any. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested. It will be affected by changes in the exchange rate between the base currency of the fund and the subscription currency, if different. Sales charges (up to a maximum of 5% for the A Class), taxes and other locally applied costs have not been deducted and if applicable, they will reduce the performance figures. 

Where the base currency of the fund differs from the share class currency, exchange rate movements may affect returns.

Index returns shown with reinvestment of dividends after the deduction of withholding taxes. 

Effective 1 July 2018, the "net" version of the indicative benchmark replaced the "gross" version of the indicative benchmark. The "net" version of the indicative benchmark assumes the reinvestment of dividends after the deduction of withholding taxes applicable to the country where the dividend is paid; as such, the returns of the new benchmark are more representative of the returns experienced by investors in foreign issuers. Historical benchmark performance has been restated accordingly. 

30-Sep-2020 - Sebastien Mallet, Portfolio Manager,
Markets fell in September, as investors took profits following the rally in August that left major U.S. benchmarks at or near all-time highs. There was a sense that markets were overbought, and European shares pulled back in sympathy with this technology-led decline in U.S. equities. News that AstraZeneca was pausing the trials of its leading coronavirus vaccine candidate after a participant developed a serious neurological disorder also weighed on sentiment. In contrast, investors were encouraged by data released in September suggesting that the production side of China’s economy remained in solid shape, while in the U.S. the unemployment rate fell more than expected in July. Within the portfolio, stock selection in information technology (IT) was beneficial to performance. For example, we own a position in Fiserv; the financial services technology company operates primarily through the payments and financial segments. In our view, the company is well positioned to enjoy a multiyear period of above-average organic growth as the penetration rate of mobile banking continues to increase.

Holdings

Total
Holdings
99
Largest Holding NextEra Energy 2.95% Was (30-Jun-2020) 2.67%
Other View Full Holdings Quarterly data as of 30-Sep-2020
Top 10 Holdings 18.71% View Top 10 Holdings Monthly data as of 30-Sep-2020

Largest Top Contributor^

NextEra Energy
By 1.03%
% of fund 2.98%

Largest Top Detractor^

AbbVie
By -0.27%
% of fund 1.59%

^Absolute

Quarterly Data as of 30-Sep-2020

Top Purchase

Fiserv (N)
1.63%
Was (30-Jun-2020) 0.00%

Top Sale

Chevron (E)
0.00%
Was (30-Jun-2020) 1.48%

Quarterly Data as of 30-Sep-2020

30-Jun-2020 - Sebastien Mallet, Portfolio Manager,

Over the course of the second quarter, we made a number of adjustments to our individual holdings within sectors, mainly for bottom-up, stock-specific reasons rather than due to a substantial shift in our sector view. We modestly reduced our overall exposure to energy, utilities, real estate, communication services, and industrials and business services.

Our major overweight sector positions at the end of June remained in financials, energy, and utilities. The largest underweight sector positions included IT, consumer staples, consumer discretionary, and communication services. On a country basis, our main underweight allocation is in the U.S. where we see less compelling valuations, while the largest relative overweight position is China.

Communication Services

Within the communication services space, our relative overweight positions include T-Mobile and WPP. Over the course of the quarter, we eliminated our holding in Verizon Communications. As a result, we moved from a small overweight to just below benchmark neutral.

  • Verizon Communications�is a U.S. holding company, which engages in the provision of communications, information, and entertainment products and services to consumers, businesses, and governmental agencies. We believe that there is limited long-term fundamental upside for the stock as the sector becomes increasingly competitive in the coming years.

Real Estate

Over the course of the second quarter, we modestly reduced our exposure to the real estate sector, and by the end of June, the portfolio was just below benchmark neutral.

  • We sold out of Equity Residential, a real estate investment trust, which engages in the acquisition, development, and management of rental apartment properties. This includes the generation of rental and other related income through the leasing of apartment units to residents. The company has had a challenging start to the year on account of the spread of the coronavirus and faces longer-term risks given potential political and demographic shifts.
  • We used part of the proceeds from our sale of Equity Residential to initiate a position in U.S. real estate investment company Equity Commonwealth, which engages in the ownership and operation of office properties. While the company is not immune to the economic slowdown, it is a beneficiary of the low interest rate environment. The company recently reduced the number of office properties owned, and given the office market downturn, management is considering a wide range of investment opportunities.

Materials

Our key materials holdings include Franco-Nevada, Lundin Mining, and Westlake Chemical. As the second quarter began, we were broadly benchmark neutral with respect to the sector, but over the course of the review period, we bought a new position in a gold producer.

  • Newmont is one of the world's largest gold producers and operates in North and South America, Australia, and Africa. Over the period, we increased the portfolio's exposure to gold, which tends to respond defensively in down markets. In June, the company identified new gold zones on its property portfolio.

Utilities

We made a number of changes to the portfolio's utilities holdings. For example, we eliminated Edison International and trimmed the size of our positions in Sempra Energy and NextEra Energy, redeploying the proceeds of these sales into Southern Company.

  • We initiated a holding in Southern Company, the owner of regulated electric and gas utilities predominantly in the Southeast of America. The company has a very attractive multiyear risk/reward profile, in our opinion. It also benefits from a more certain regulatory outlook when compared with peers and should benefit from a favorable long-term generation modernization opportunity. The pandemic is likely to adversely affect construction activities; however, we believe the costs associated with delays should be relatively contained.

IT

We have a long-standing underweight with respect to the IT sector, and this remained broadly unchanged over the quarter. However, we built a new position in Samsung Electronics.

  • Samsung Electronics is, in our view, the market leader of key technology components, including memory, TFT-LCD panels, and processors. The company is also the one of the world's largest mobile handset producers and leading providers of flat-screen televisions. While the dynamic random-access memory (DRAM) cycle is likely to be weak in the second half of the year, we believe there is upside potential in 2021. In our view, Samsung Electronics is likely to take a more conservative approach to capacity expansion going forward, and 5G penetration will create more data traffic and data center demand.

Industrials and Business Services

Over the course of the second quarter, we reduced the portfolio's exposure to industrials, moving from modestly overweight to a small underweight. This was partially the result of us selling out of our holding in L3Harris Technologies.

  • L3Harris Technologies�provides assured communications products such as tactical radios, defense electronics, space and intelligence systems, and mission support services. Over time, we expect the company's cost synergies to dissipate while the overall defense backdrop is likely to become increasingly challenging.

Sectors

Total
Sectors
11
Largest Sector Information Technology 17.41% Was (31-Aug-2020) 15.85%
Other View complete Sector Diversification

Monthly Data as of 30-Sep-2020

Indicative Benchmark: MSCI World Index

Top Contributor^

Materials
Net Contribution 0.37%
Sector
0.15%
Selection 0.22%

Top Detractor^

Consumer Discretionary
Net Contribution -0.65%
Sector
-0.23%
Selection
-0.42%

^Relative

Quarterly Data as of 30-Sep-2020

Largest Overweight

Utilities
By5.15%
Fund 8.40%
Indicative Benchmark 3.25%

Largest Underweight

Information Technology
By-4.72%
Fund 17.41%
Indicative Benchmark 22.13%

Monthly Data as of 30-Sep-2020

30-Sep-2020 - Sebastien Mallet, Portfolio Manager,
Our major overweight sector positions at the end of September were in utilities, materials, and financials. The largest underweight sector positions included IT, consumer staples, and communication services. Over the past few months, we have increased the portfolio’s exposure to materials. We like three areas within this space: (i) cyclical materials, such as copper and iron ore; (ii) precious metals (gold, silver); and (iii) cyclical areas, such as packaging. In September we topped up our position in a Finland-based producer of paper-based packaging, wood products used in building applications, and pulp.

Regions

Total
Regions
5
Largest Region North America 59.31% Was (31-Aug-2020) 60.46%
Other View complete Region Diversification

Monthly Data as of 30-Sep-2020

Indicative Benchmark: MSCI World Index

Top Contributor^

Latin America
Net Contribution 0.25%
Region
0.01%
Selection 0.24%

Top Detractor^

United States
Net Contribution -1.57%
Region
-0.15%
Selection
-1.42%

^Relative

Quarterly Data as of 30-Sep-2020

Largest Overweight

Pacific Ex Japan
By5.04%
Fund 8.46%
Indicative Benchmark 3.42%

Largest Underweight

North America
By-10.06%
Fund 59.31%
Indicative Benchmark 69.37%

Monthly Data as of 30-Sep-2020

Countries

Total
Countries
20
Largest Country United States 55.44% Was (31-Aug-2020) 56.32%
Other View complete Country Diversification

Monthly Data as of 30-Sep-2020

Indicative Benchmark: MSCI World Index

Largest Overweight

China
By3.56%
Fund 3.58%
Indicative Benchmark 0.03%

Largest Underweight

United States
By-10.84%
Fund 55.44%
Indicative Benchmark 66.28%

Monthly Data as of 30-Sep-2020

Team (As of 01-Oct-2020)

Sebastien Mallet

Sebastien Mallet is a portfolio manager in the Equity Division at T. Rowe Price, managing the Institutional Global Value Strategy. Mr. Mallet is a vice president of T. Rowe Price Group, Inc. and T. Rowe Price International Ltd.

Mr. Mallet has 19 years of investment experience, 14 of which have been at T. Rowe Price. Prior to joining the firm in 2005, he was a telecom banker at Credit Suisse First Boston in the Tokyo and London offices. Mr. Mallet started his career as a financial analyst with France Telecom, based in Guangzhou, China, and Madrid, Spain.

Mr. Mallet earned an M.A., with honours, in finance from the University of Paris and an M.B.A. from the London Business School.

  • Fund manager
    since
    2012
  • Years at
    T. Rowe Price
    15
  • Years investment
    experience
    19

Fee Schedule

Share Class Minimum Initial Investment and Holding Amount (USD) Minimum Subsequent Investment (USD) Minimum Redemption Amount (USD) Sales Charge (up to) Investment Management Fee (up to) Ongoing Charges
Class A $1,000 $100 $100 5.00% 160 basis points 1.77%
Class I $2,500,000 $100,000 $0 0.00% 75 basis points 0.85%

Please note that the Ongoing Charges figure is inclusive of the Investment Management Fee and is charged per annum.

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GIPS® Information

T. Rowe Price ("TRP") claims compliance with the Global Investment Performance Standards (GIPS®). TRP has been independently verified for the twenty one- year period ended June 30, 2017 by KPMG LLP. The verification report is available upon request. Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm's policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. Verification does not ensure the accuracy of any specific composite presentation.

TRP is a U.S. investment management firm with various investment advisers registered with the U.S. Securities and Exchange Commission, the U.K. Financial Conduct Authority, and other regulatory bodies in various countries and holds itself out as such to potential clients for GIPS purposes. TRP further defines itself under GIPS as a discretionary investment manager providing services primarily to institutional clients with regard to various mandates, which include U.S, international, and global strategies but excluding the services of the Private Asset Management group.

A complete list and description of all of the Firm's composites and/or a presentation that adheres to the GIPS® standards are available upon request. Additional information regarding the firm's policies and procedures for calculating and reporting performance results is available upon request

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