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New Guru Added: Charles de Vaulx

April 30, 2013 | About:
Vera Yuan

Vera Yuan

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As we continue to extend our coverage to global market for GuruFocus Global Membership, we are glad to announce that we have just added Charles de Vaulx into our List of Gurus. We want to point out that Charles de Vaulx was in our List of Gurus before he left First Eagle Funds in 2008. We are happy to have him back, now with IVA Funds. Charles invests extensively in global markets and has generated impressive track records. We will track both of his funds: IVA Worldwide Value Fund and IVA International Value Fund.

Charles de Vaulx

Charles de Vaulx is the chief investment officer and portfolio manager at International Value Advisers LLC (IVA). He joined the firm in May 2008.

Until March 2007, Charles was portfolio manager of the First Eagle Global, Overseas, U.S. Value, Gold and Variable Funds, together with a number of separately managed institutional accounts. He was solely responsible for management of the Sofire Fund Ltd. when it won an Absolute Return Award* for “Fund of the Year” in the global equity category in 2005 and 2006.

In addition to sharing Morningstar's "International Stock Manager of the Year" Award** in 2001 with his co-manager, Charles was runner-up for the same award in 2006.

Charles de Vaulx graduated from the Ecole Superieure de Commerce de Rouen in France and holds the French equivalent of a master's degree in finance.

Charles de Vaulx employs a value oriented approach and will seek investments in companies of any size that typically have one or more of the following characteristics: financial strength, temporarily depressed earnings or entrenched franchises. However, the overriding attribute of such companies is that their securities offer fundamental value. He is a global investor as most of his portfolio is invested in international companies.

The portfolio we track under Charles de Vaulx is IVA Worldwide Fund.

The basic information of his two funds are showed in the following table:

03/31/2013 Manager Inception Year Total Assets ($Million) Expense Ratio (%) 3 M 1 Y 3 Y Since Inception
IVA Worldwide Fund (IVWAX) Charles de Vaulx, Chuck de Lardemelle 2008 8706.2 1.28 6.16 6.61 7.48 11.64
IVA International Fund (IVIOX) Charles de Vaulx, Chuck de Lardemelle 2008 2987.1 1.27 5.46 9.51 8.43 11.36


The regional allocations of his two funds are showed in the following table:

Regional Allocation
IVA Worldwide Fund IVWAX IVA International Fund IVIOX
United States 32.80% Europe (ex-UK) 28.30%
Europe Ex-UK 18.20% Japan 19.40%
Asia Ex-Japan 11.00% Asia (ex-Japan) 19.20%
Japan 10.50% Gold and Gold Mining 4.90%
Gold and Gold Mining 5.00% United States 1.60%
Other Countries 0.80% United Kingdom 1.40%
United Kingdom 0.70% Other Countries 1.40%
Other -0.10% Other -0.20%
Cash and Cash Equivalents 21.10% Cash and Cash Equivalents 24.00%
Total 100.00% Total 100.00%


IVA International Fund

Profile:

IVA International Fund Class A (IVIOX) was established on 10/1/2008. The total net assets are $2,987.1 million and the turnover rate (as of 9/30/2012) is 29.9%. The fund will seek long-term growth of capital by investing in a range of securities and asset classes from markets around the world. Within this fund, the top four sectors are Industrials (27.11%), Consumer Cyclical (25.21%) and Consumer Defensive (14.75%). The top two geographic allocations are France (31.95%) and Japan (28.63%).

IVA International Fund is managed by Charles de Lardemelle (since 9/30/2008) and Charles de Vaulx (since 9/30/2008).

Philosophy:

“IVA employs a value oriented approach and will seek investments in companies of any size that typically have one or more of the following characteristics: financial strength, temporarily depressed earnings or entrenched franchises. However, the overriding attribute of such companies is that their securities offer fundamental value. For IVA, fundamental value is not to be confused with relative value. IVA pays particular attention to their emphasis on establishing an 'intrinsic value' and a 'margin of safety.'

IVA defines intrinsic value as "the amount that a knowledgeable investor or corporate competitor would pay - in cash - for 100% of the economic and controlling interests of a company.” A security is deemed attractive if there is a suitable margin of safety, meaning that the market price of a security is trading at a large discount to its assessed intrinsic value. We believe that this investment approach emphasizes capital preservation while still providing the capacity to achieve superior returns over the long-term.

We believe our strength resides in the contrarian, absolute return, low risk, global, pan-asset class emphasis. We pay no attention to what Wall Street or pundits believe. We pay close attention to the downside and aim to generate absolute returns by avoiding bubbles, maintaining geographic and asset class diversification, and at the time of purchase, we insist on a meaningful discount to an individual holding's estimated intrinsic value. Furthermore, we do not shy away from holding cash if attractive discounts are unavailable.

Investment opportunities are identified through intensive research of individual companies. IVA does not rely on third party research, which tends to focus on short-term earnings rather than intrinsic value.”

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