Location: Los Angeles
Principals: Sarah Ketterer, CEO; Harry Hartford, president and portfolio manager
Style: International equity manager
AUM as of June 30: $3.14 billion
Three-year annualized performance:
Benchmark (MSCI EAFE): -13.2%
Three-year alpha: 13.6
Causeway was founded by the team that managed the international value equity strategy at Hotchkis and Wiley, Los Angeles, since 1990.
Four senior members of the team initially left to start Causeway in June 2001. "Within two weeks, we brought over 25 other people who had worked on the portfolio," recalled Mark Kone, chief marketing officer and one of the original four.
Causeway employs the same international value strategy the team used at Hotchkis. "We use a bottom-up fundamental approach in stock selection; we invest only in the developed world. We also do a lot of quantitative work, using proprietary risk models. Combined, they help us control risk and allow us to screen up front," said Mr. Kone. Currently the portfolio is overweight in the insurance and consumer sectors.
Consultants are bullish on the firm. "They're a good example of a team working together a long time that has been able to generate the best alpha," said Doug DuMond, president and chief executive officer of Overture Asset Managers, New York.
Michael Rosen, principal at Angeles Investment Advisors, Santa Monica, Calif., said: "Very few people have been managing the same portfolio (international value) for as long as Sarah Ketterer has (since 1990), or have had as much investment success. We attribute that to intelligence, hard work and a disciplined investment process. There's nothing extraordinary about these factors, but Causeway manages to apply them at a higher level than most."