FPA International Value Fund

Objective:

The FPA International Value strategy endeavors to provide above average capital appreciation over the long term while attempting to minimize the risk of capital losses.

We seek to identify absolute value opportunities across international markets, including both developed and emerging countries.

Philosophy:

  • Absolute value investors: We seek genuine bargains in the equity markets rather than relatively attractive ones. We may at times hold large amounts of cash if we cannot find enough opportunities meeting our investment requirements.
  • Long-term focus: We find that our investment goals are best achieved by taking a long-term contrarian approach. In practice we tend to stay invested on average about five years.
  • Bottom-up: We select and value individual stocks based on the fundamentals of the underlying businesses. We always demand that our investments meet the following criteria:
  • 1. High quality businesses with long-term staying power.

    2. Overall financial strength and ability to weather market dislocations.

    3. Management teams that allocate capital in a value creative manner.

    4. Significant discount to the intrinsic value of the business.

  • Broad investment universe: We invest across market caps, industries, and geographies.
  • Concentration: We focus only on our best ideas and expect to be invested in no more than 25-35 stocks.
  • Research-driven: Prior to making investments, we engage into an extensive research and valuation process. Portfolio construction is the product of that process with the most attractive names accounting for the greatest weightings.
  • Downside protection: We believe our process is inherently risk-averse. First, we limit ourselves to companies with strong balance sheets. Second, we spend a lot of time understanding the operational risk profile of the businesses in which we invest. If we cannot get comfortable with the long-term economics of a business, we do not invest. Lastly, we only buy a stock when it offers a significant discount to our estimate of intrinsic value.
    Value investing does not protect against loss of principal and their is no assurance that the Fund will meet its objective.


As of July 31, 2014

Comparative Performance Monthly

Fund/IndexMTDYTD1 Year Since Inception**
FPA International Value Fund-3.06 %-0.18 %6.66 %15.75 %
MSCI ACWI ex US-0.99 %4.51 %15.48 %13.20 %

** Annualized. Inception of FPA International Value Fund is December 1, 2011.
A redemption fee of 2.00% will be imposed on redemptions within 90 days.
Expense ratio calculated as of most recent prospectus is 1.32%. The advisor has contractually agreed to waive fees/certain Fund expenses through June 30, 2015.Gross Expense Ratio is 4.14%.
Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown. This data represents past performance and investors should understand that investment returns and principal values fluctuate, so that when you redeem your investment it may be worth more or less than its original cost. Current month-end performance data may be obtained by calling toll-free, 1-800-982-4372.


As of June 30, 2014

Average Annual Returns

Fund/IndexQTRYTD1 Year Since Inception**Expense Ratio1
FPA International Value Fund1.92 %2.98 %15.86 %17.71 %1.26 %
MSCI ACWI ex US5.03 %5.56 %21.75 %14.10 %

** Annualized. Inception of FPA International Value Fund is December 1, 2011.
A redemption fee of 2.00% will be imposed on redemptions within 90 days.
1Expense Ratio is calculated as of the date of the most recent prospectus.The advisor has contractually agreed to waive fees/certain Fund expenses through June 30, 2015. Gross Expense Ratio is 4.14%.
Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown. This data represents past performance and investors should understand that investment returns and principal values fluctuate, so that when you redeem your investment it may be worth more or less than its original cost. Current month-end performance data may be obtained by calling toll-free, 1-800-982-4372.


Historical Annual Returns

FPA International Value Fund*MSCI ACWI ex US
201318.00 %15.29 %
201224.04 %16.83 %
2011**1.10 %-1.12 %
**Inception December 1, 2011

* Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown. Performance has been calculated on a total return basis, which combines principal and dividend income changes for the periods shown. Principal changes are based on the difference between the beginning and closing net asset values for the period and assume reinvestment of all dividends and distributions paid. All applicable expenses such as advisory fees have been included in calculating performance. This data represents past performance and investors should understand that investment returns and principal values fluctuate, so that when you redeem your investment it may be worth more or less than its original cost. Current month-end performance data may be obtained http://www.fpafunds.com/internationalvalue or by calling toll-free, 1-800-982-4372.
You should consider the Fund’s investment objectives, risks, and charges and expenses carefully before you invest. The Prospectus details the Fund's objective and policies, sales charges, and other matters of interest to the prospective investor. Please read this Prospectus carefully before investing. The Prospectus may be obtained at http://www.fpafunds.com/docs/default-document-library/ivf_prospectus by email at info@fpafunds.com, toll-free by calling 1-800-982-4372 or by contacting the Fund in writing.


Portfolio Structure *

CASH & EQUIVALENTS*:
39.1%
TOTAL NET ASSETS:
$619.6 Million
TOTAL SECURITIES IN PORTFOLIO
22




Top Holdings*

SAP
  6.2%   Incitec   4.3%
Aggreko   5.6%   Danone
  4.3%
Fugro   4.9%   Diageo
  4.3%
G4S   4.5%   ATEA
  3.9%
Michael Page   4.4%   LSL Property Services
  3.2%
 
Excludes U.S. Treasuries
Top 10 Holdings represent 45.6% of Total Net Assets

Portfolio Holdings

* Characteristics as of June 30, 2014. Holdings as of June 30, 2014. Portfolio composition will change due to ongoing management of the funds.  References to individual securities or sectors are for informational purposes only and should not be construed as recommendations by the Funds, Advisor or Distributor.
    
Past performance is not indicative of future performance. The MSCI ACWI ex-USA Index is a float-adjusted market capitalization index that is designed to measure the combined equity market performance of developed and emerging market countries excluding the United States. These indices do not reflect any commissions or fees which would be incurred by an investor purchasing the stocks they represent. This index does not reflect any commissions or fees which would be incurred by an investor purchasing the stocks it represents.  The performance of the Fund and of the Index is computed on a total return basis which includes reinvestment of all distributions.  It is not possible to invest directly in an index.

 


*After -tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes.  Actual after-tax returns depend upon an investor's tax situation and may differ from those shown.  After-tax returns presented here are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or IRAs.

Performance has been calculated on a total return basis, which combines principal and dividend income changes for the periods shown. Principal changes are based on the difference between the beginning and closing net asset values for the period and assume reinvestment of all dividends and distributions paid. Total return calculations are based on a $10,000 investment. This data represents past performance and investors should understand that investment returns and principal values fluctuate, so that when you redeem your investment it may be worth more or less than its original cost. The Prospectus details the Fund"s objective and policies, sales charges, and other matters of interest to the prospective investor. Please read this Prospectus carefully before investing.