objective
The Fund seeks long-term growth of principal and income.
Strategy
The Fund will invest primarily in a diversified portfolio of emerging
markets equity securities issued by companies from at least three
different countries. The Fund is not required to allocate its
investments in set percentages in particular countries. Under
normal circumstances, the Fund will invest at least 80% of its total
assets in equity securities of emerging market issuers. Derivative
transactions that have economic characteristics similar to such
equity securities are included in the Fund’s 80% investment policy.
Emerging market issuers include those located in emerging market
countries and those determined by Dodge & Cox to have significant
economic exposure to emerging market countries. For purposes of
its 80% investment policy, Dodge & Cox will consider countries that
are not part of the MSCI Developed Market Indices (including
frontier markets countries) to be emerging market countries. In
determining whether an issuer is located in or has significant
economic exposure to an emerging market country, Dodge & Cox will consider
the issuer’s country of organization, the location of its management,
the country of its primary listing, its reporting currency, and whether the
issuer has substantial assets in, or derives significant revenues from,
emerging market countries. The Fund may use derivatives, such as
futures, options, and swaps either to create exposure to equity securities or to hedge against exposure created by its other investments. The Fund may gain exposure to emerging market issuers by investing in exchange-traded funds (“ETFs”). The Fund may use currency forward contracts, currency swaps, or currency futures contracts to hedge direct and/or indirect foreign currency exposure.
In selecting investments, the Fund typically invests in
companies that, in Dodge & Cox’s opinion, appear to be temporarily
undervalued by the stock market but have a favorable outlook for
long-term growth. Dodge & Cox relies on fundamental research to
select investments for the Fund’s portfolio, supplemented by
financial screening models that help identify companies from within
the Fund’s investment universe for further consideration by research
analysts. The Fund focuses on the underlying financial condition
and prospects of individual companies, including future earnings,
cash flow, and dividends. Various other factors, including financial
strength, economic condition, competitive advantage, quality of the
business franchise, and the reputation, experience, and
competence of a company’s management are weighed against
valuation in selecting individual securities. The Fund also considers
the economic and political stability of the country where the issuer
is located and the protections provided to shareholders. The Fund
may invest in companies of any size, including large-, medium-, and
small-cap companies.
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