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Brandes Investment Trust (BVNSC)

Filed: 5 Dec 19, 1:49pm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORMN-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number811-08614

Brandes Investment Trust

(Exact name of registrant as specified in charter)

11988 El Camino Real, Suite 600

San Diego, CA 92130

(Address of principal executive offices) (Zip code)

Lea Anne Copenhefer

Morgan, Lewis & Bockius LLP

One Federal Street

Boston, MA 02110-1726

(Name and address of agent for service)

800-331-2979

Registrant’s telephone number, including area code

Date of fiscal year end:September 30, 2019

Date of reporting period:September 30, 2019


Item 1. Reports to Stockholders.

 


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ANNUAL REPORT INTERNATIONAL EQUITY FUND GLOBAL EQUITY FUND GLOBAL EQUITY INCOME FUND EMERGING MARKETS VALUE FUND INTERNATIONAL SMALL CAP EQUITY FUND SMALL CAP VALUE FUND CORE PLUS FIXED INCOME FUND For the year ended September 30, 2019 Beginning in January 2021, as permitted by regulations adopted by the U.S. Securities and Exchange Commission, paper copies of the Funds’ annual and semi-annual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports. Instead, the reports will be made available on the Funds’ website (http://www.brandesfunds.com/literature.html), and you will be notified by mail each time a report is posted and provided with a website link to access the report. If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Funds electronically anytime by contacting your financial intermediary (such as a broker-dealer or a bank) or, if you are a direct investor, by calling1-800-395-3807, sending ane-mail request to info@brandesfunds.com, or by enrolling at http://www.brandesfunds.com/literature.html. You may elect to receive all future reports in paper free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the Funds, you can call1-800-395-3807 or send an email request to info@brandesfunds.com to let the Funds know you wish to continue receiving paper copies of your shareholder reports. Your election to receive reports in paper will apply to all Funds held in your account with that intermediary if you invest through your financial intermediary or all Funds held with the fund complex if you invest directly with the Funds. [Graphic Appears Here]


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Table of Contents

 

 

Letter to Shareholders and Performance Graphs

   2 

Introduction Letter

   2 

Brandes International Equity Fund

   5 

Brandes Global Equity Fund

   9 

Brandes Global Equity Income Fund

   13 

Brandes Emerging Markets Value Fund

   17 

Brandes International Small Cap Equity Fund

   21 

Brandes Small Cap Value Fund

   25 

Brandes Core Plus Fixed Income Fund

   29 

Expense Example

   35 

Schedule of Investments

   38 

Brandes International Equity Fund

   38 

Brandes Global Equity Fund

   41 

Brandes Global Equity Income Fund

   44 

Brandes Emerging Markets Value Fund

   47 

Brandes International Small Cap Equity Fund

   53 

Brandes Small Cap Value Fund

   58 

Brandes Core Plus Fixed Income Fund

   62 

Statements of Assets and Liabilities

   68 

Statements of Operations

   70 

Statements of Changes in Net Assets

   72 

Financial Highlights

   76 

Notes to Financial Statements

   88 

Report of Independent Registered Public Accounting Firm

   110 

Additional Information

   112 

Trustees and Officers Information

   116 

 

1


Introductory Letter to Shareholders

 

Dear Shareholders,

Sir John Templeton famously warned in the eleventh of his “16 Rules for Investment Success” that the investor who saysthis time is different has uttered “the four most costly words in the annals of investing.”1 The legendary growth fund manager was making the point that one needs to be careful of rationalizing why the current environment will end better than a similar one did previously.

Why do we bring up Templeton’s quote from more than 25 years ago? Today, the pace of innovation is changing our lives so dramatically that it can be tempting to think that surely thebusiness landscape is no longer what it once was. And in the past, investors have falsely believed that sharp advances in security prices would continue because of some new development. Even Templeton reportedly conceded that the investor who says this time is different has a 20% chance of being correct.2

Disruptive technologies have indeed threatened a variety of industries, causing some investors to question the idea ofmean reversion and whether certain companies or entire sectors can return to prior levels of growth.

We consider it our job as an active value manager to differentiate between those industries whose fundamentals are being disrupted from those who are only experiencing stock price disruption. Opportunities can arise if the market overreacts to the threat of disruption and underappreciates a seemingly threatened company’s moat or durability.

Indeed, we think active value management is the most logical approach to investing when disruptive technologies roil the market. Obviously, passive or index strategies pay little heed to secular changes, and smart-beta factors that rely onprice-to-book orprice-to-earnings multiples to drive stock selection may miss company- or industry-specific nuances.

Our approach to value investing seeks to determine whether a company is simply “cheap” or whether it is undervalued. With a cheap company, the price has fallen but is unlikely to recover because the company is vulnerable to structural issues. On the other hand, anundervaluedcompany has mean-reverting capabilities, meaning its price has fallen for reasons that may not be long-lasting.

A key tenet of the value approach is to develop a solid understanding of not only the company but its industry and main competitors. This naturally leads us to investigate the specific role technology plays in the company as well as the industry. In each case we ask, is this company and/or industry vulnerable to disruption? Or is there a widespread misperception that may be creating an asymmetric opportunity?

 

 

 

1 

“16 Rules for Investment Success” by Sir John Templeton, Franklin Templeton Investments, 2017. Reprinted fromWorld Monitor: The Christian Science Monitor Monthly,1993.

 

2 

Memo to Oaktree Clients, Howard Marks, Oaktree Capital Management, June 12, 2019

 

2


For example, our research teams are wary of the competitive threat that online retailers pose to traditionalbrick-and-mortar retailers, and we have limited our exposure accordingly. However, not all industries may be exposed to these threats equally. We have found opportunities in a few grocers, especially in the United Kingdom, because online and home delivery companies have not been able to easily disrupt these established businesses.

Likewise, we are overweight financials, especially in the United States, despite threats from financial technology (fintech) firms. Fintechs largely affect personal loans, money exchange and payments, while we’ve found value in some of the larger money center banks that also derive a large portion of their value from the more defensible areas of trade finance, foreign exchange and payments. In addition, many of these institutions not only have the resources to compete with the fintechs, but should also benefit from their technology investments that improve efficiencies and fundamentals. We believe such fundamental improvements will eventually be reflected in higher share prices.

Foroil-related companies, secular competition — e.g., from electric cars and solar energy — appears to be growing. But these innovations might not have a truly major effect for years to come. While some investors may look at oil as a dying industry, global oil demand and production are each expected to continue growing, (thanks in part to emerging markets), although they may be volatile in the shorter term due to cyclical, economic and political factors.3 Our company-specific analysis has led us to opportunities in integrated oil companies (with operations in nearly all facets of energy production and distribution) with strong balance sheets and diverse exposure to the value chain, rather than the more levered companies focusing only on exploration and production.

Disruption from technological innovation has been part of investing at least since the appearance of the automobile threatened theso-called “buggy whip” companies in the late 19th century. Today, the pace of disruption might appear more amplified than ever before. But our task has been the same since Brandes began operating 45 years ago. We strive to determine if a business that has fallen out of favor has the ability to adapt and survive, or will go the way of the buggy whip makers.

Todayis different from the past in many ways. But theprinciples guiding our active value investing approach haven’t changed. And the disruption we’ve witnessed recently only strengthens our belief in the need for investors to distinguish potentially undervalued businesses from cheap companies that may only get cheaper.

Thank you for your business and continued trust.

 

 

 

3 

U.S. Energy Information Administration, July 2019

 

3


Price/Book:  Price per share divided by book value per share.

Price/Earnings:  Price per share divided by earnings per share.

Smart Beta:  An investment strategy that is based on a passive approach but seeks to adjust portfolio weights to manage risk variables such as volatility, quality, liquidity, etc.

Mutual fund investing involves risk. Principal loss is possible.

A mutual fund’s investment objectives, risks, charges and expenses must be considered carefully before investing. The statutory and summary prospectuses contain this and other important information about the investment company, and may be obtained by calling 1.800.395.3807 or visiting brandesfunds.com. Read carefully before investing.

The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice. Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.

The Brandes Funds are distributed by ALPS Distributors, Inc.

 

4


Brandes International Equity Fund

 

Dear Fellow Investor,

The net asset value of the Brandes International Equity Fund (Class I Shares) declined 5.82% in the year ending September 30, 2019. For the same period, the MSCI EAFE Index fell 1.34%.

Portfolio holdings in the Diversified Telecommunication Services, Equity Real Estate Investment Trusts (REITs) and Multi-Utilities industries were contributors to performance, while holdings in Food & Staples Retailing, Capital Markets and Banks detracted from returns.

Holdings in Russia, Brazil and France contributed to performance, while results were hampered by holdings in United Kingdom, Japan and Switzerland.

Three of the largest individual contributors to performance were Fibra Uno Admin. SA de C.V. (Mexico — Equity Real Estate Investment Trusts (REITs)), Engie SA (France — Multi-Utilities) and Telefonica Brasil S.A. (Brazil — Diversified Telecom Services). Cemex SA (Mexico — Construction Materials), Marks & Spencer Group Plc (United Kingdom — Multiline Retail) and Mitsubishi Tanabe Pharma (Japan — Pharmaceuticals) were three of the largest detractors from performance.

At the close of the period, the Fund’s largest country weights were in United Kingdom and France, and the Fund’s largest industry weights were in Pharmaceuticals and Oil, Gas & Consumable Fuels. Please note that while macro conditions are considered when we determine valuation estimates for individual companies, our country and industry weightings are aby-product ofbottom-up stock selection, not the result oftop-down observations.

After nearly a half-century of professional investing, Brandes Investment Partners remains fixed on its original goal. We pursue above-market returns to help you fulfill your long-term investment objectives. Our approach remains deeply rooted in the value philosophy and seeks to identify worthy but potentially underpriced companies. Thank you for your confidence in our approach.

Thank you for your business and continued trust.

Sincerely yours,

The Brandes InternationalLarge-Cap Investment Committee

Brandes Investment Trust

Because the values of the fund’s investments will fluctuate with market conditions, so will the value of your investment in the fund. You could lose money on your investment in the fund, or the fund could underperform other investments. The values of the fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. In addition, the performance of foreign securities depends on the political and economic environments and other overall

 

5


Brandes International Equity Fund

 

economic conditions in the countries where the fund invests. Emerging country markets involve greater risk and volatility than more developed markets. Some emerging markets countries may have fixed or managed currencies that are not free-floating against the U.S. dollar. Certain of these currencies have experienced, and may experience in the future, substantial fluctuations or a steady devaluation relative to the U.S. dollar. Value stocks typically are less volatile than growth stocks; however, issues of value stocks typically have a lower expected growth rate in earnings and sales than issues of growth stocks.

Past performance is not a guarantee of future results.

Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.

The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.

Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.

Must be preceded or accompanied by a prospectus.

Index Guide

The MSCI EAFE Index with net dividends captures large and mid cap representation of developed market countries excluding the U.S. and Canada.

MSCI has not approved, reviewed or produced this report, makes no express or implied warranties or representations and is not liable whatsoever for any data in the report. You may not redistribute the MSCI data or use it as a basis for other indices or investment products.

One cannot invest directly in an index.

The Brandes International Equity Fund is distributed by ALPS Distributors, Inc.

 

6


Brandes International Equity Fund

 

The following chart compares the value of a hypothetical $100,000 investment in the Brandes International Equity Fund – Class I from September 30, 2009 to September 30, 2019 with the value of such an investment in the MSCI EAFE (Europe, Australasia and Far East) Index for the same period.

Value of $100,000 Investment vs MSCI EAFE (Europe, Australasia and Far East) Index (Unaudited)

 

LOGO

 

   Average Annual Total Return
Periods Ended September 30, 2019
 
   One
Year
  Five
Years
  Ten
Years
  Since
Inception(1)
 

Brandes International Equity Fund

     

Class A*

   -5.98  1.92  3.51  7.11

Class A* (with maximum sales charge)

   -11.39  0.73  2.90  6.83

Class C*

   -6.73  1.15  2.70  6.30

Class C* (with maximum sales charge)

   -7.63  1.15  2.70  6.30

Class I

   -5.82  2.11  3.69  7.34

Class R6*

   -5.69  2.26  3.79  7.42

MSCI EAFE (Europe, Australasia, and Far East) Index

   -1.34  3.27  4.90  4.55

 

(1) 

The inception date is January 2, 1997.

 

*

Performance shown prior to January 31, 2011 for Class A shares reflects the performance of Class I shares adjusted to reflect Class A expenses. Performance shown prior to January 31, 2013 for Class C shares reflects the performance of Class I shares adjusted to reflect Class C expenses. Performance shown prior to February 1, 2016 for Class R6 shares reflects the performance of Class I shares adjusted to reflect Class R6 expenses.

Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or

 

7


Brandes International Equity Fund

 

higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.

The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The Advisor has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.

Sector Allocation as a Percentage of Total Investments as of

September 30, 2019 (Unaudited)

 

LOGO

The sector classifications represented in the graph above are in accordance with Global Industry Classification Standard (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC.

 

8


Brandes Global Equity Fund

 

Dear Fellow Investor,

The net asset value of the Brandes Global Equity Fund (Class I Shares) declined 4.98% in the year ending September 30, 2019. For the same period, the MSCI World Index rose 1.83%.

Portfolio holdings in the Pharmaceuticals, Equity Real Estate Investment Trusts (REITs) and Multi-Utilities industries were contributors to performance, while holdings in Capital Markets, Oil, Gas & Consumable Fuels and Food & Staples Retailing detracted from returns.

Holdings in Mexico, France and Russia contributed to performance, while results were hampered by holdings in United Kingdom, United States and Switzerland.

Three of the largest individual contributors to performance were Fibra Uno Admin. SA de C.V. (Mexico — Equity Real Estate Investment Trusts (REITs)), Engie SA (France — Multi-Utilities) and Merck & Co. (United States — Pharmaceuticals). Imperial Brands PLC (United Kingdom — Tobacco), UBS Group AG (Switzerland — Capital Markets) and Nissan Motor Co., Ltd. (Japan — Automobiles) were three of the largest detractors from performance.

At the close of the period, the Fund’s largest country weights were in United States and United Kingdom, and the Fund’s largest industry weights were in Banks and Pharmaceuticals. Please note that while macro conditions are considered when we determine valuation estimates for individual companies, our country and industry weightings are aby-product ofbottom-up stock selection, not the result oftop-down observations.

Brandes Investment Partners has had the same goal since we started 45 years ago: Realize above-market gains to help you pursue your long-term investment objectives. We aim to do so by staying true to our value approach, which seeks fundamentally sound but potentially undervalued companies for the Fund. Thank you for investing with us.

Thank you for your business and continued trust.

Sincerely yours,

The Brandes GlobalLarge-Cap Investment Committee

Brandes Investment Trust

Because the values of the fund’s investments will fluctuate with market conditions, so will the value of your investment in the fund. You could lose money on your investment in the fund, or the fund could underperform other investments. The values of the fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. In addition, the performance of foreign securities depends on the political and economic environments and other overall economic conditions in the countries where the fund invests. Emerging

 

9


Brandes Global Equity Fund

 

country markets involve greater risk and volatility than more developed markets. Some emerging markets countries may have fixed or managed currencies that are not free-floating against the U.S. dollar. Certain of these currencies have experienced, and may experience in the future, substantial fluctuations or a steady devaluation relative to the U.S. dollar. Value stocks typically are less volatile than growth stocks; however, issues of value stocks typically have a lower expected growth rate in earnings and sales than issues of growth stocks.

Past performance is not a guarantee of future results.

Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.

The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.

Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.

Must be preceded or accompanied by a prospectus.

Index Guide

The MSCI World Index with net dividends captures large and mid cap representation of developed markets.

MSCI has not approved, reviewed or produced this report, makes no express or implied warranties or representations and is not liable whatsoever for any data in the report. You may not redistribute the MSCI data or use it as a basis for other indices or investment products.

One cannot invest directly in an index.

The Brandes Global Equity Fund is distributed by ALPS Distributors, Inc.

 

10


Brandes Global Equity Fund

 

The following chart compares the value of a hypothetical $100,000 investment in the Brandes Global Equity Fund – Class I from September 30, 2009 to September 30, 2019 with the value of such an investment in the MSCI World Index for the same period.

Value of $100,000 Investment vs MSCI World Index (Unaudited)

 

LOGO

 

   Average Annual Total Return
Periods Ended September 30, 2019
 
   One
Year
  Five
Years
  Ten
Years
  Since
Inception(1)
 

Brandes Global Equity Fund

     

Class A*

   -5.22  2.58  5.96  6.02

Class A* (with maximum sales charge)

   -10.66  1.37  5.34  5.45

Class C*

   -5.91  1.82  5.15  5.21

Class C* (with maximum sales charge)

   -6.80  1.82  5.15  5.21

Class I

   -4.98  2.83  6.20  6.26

MSCI World Index

   1.83  7.18  9.01  8.90

 

(1) 

The inception date is October 6, 2008.

 

*

Performance shown prior to January 31, 2011 for Class A shares reflects the performance of Class I shares adjusted to reflect Class A expenses. Performance shown prior to January 31, 2013 for Class C shares reflects the performance of Class I shares adjusted to reflect Class C expenses.

Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.

 

11


Brandes Global Equity Fund

 

The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Advisor has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.

Sector Allocation as a Percentage of Total Investments as of

September 30, 2019 (Unaudited)

 

LOGO

The sector classifications represented in the graph above are in accordance with Global Industry Classification Standard (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC.

 

12


Brandes Global Equity Income Fund

 

Dear Fellow Investor,

The net asset value of the Brandes Global Equity Income Fund (Class I Shares) fell 2.09% in the year ending September 30, 2019. For the same period, the MSCI World Index advanced 1.83%.

Portfolio holdings in the Electric Utilities, Diversified Telecommunication Services and Pharmaceuticals industries were contributors to performance, while holdings in Oil, Gas & Consumable Fuels, Capital Markets and Tobacco detracted from returns.

Holdings in Brazil, Mexico and France contributed to performance, while results were hampered by holdings in United Kingdom, Switzerland and Italy.

Three of the largest individual contributors to performance were CIA Paranaense de Energia (Brazil — Electric Utilities), Telefonica Brasil S.A. (Brazil — Diversified Telecom Svcs.) and Fibra Uno Admin. SA de C.V. (Mexico — Equity Real Estate Investment Trusts (REITs)). Imperial Brands PLC (United Kingdom — Tobacco), UBS Group AG (Switzerland — Capital Markets) and Kingfisher Plc (United Kingdom — Specialty Retail) were three of the largest detractors from performance.

At the close of the period, the Fund’s largest country weights were in United States and United Kingdom, and the Fund’s largest industry weights were in Pharmaceuticals and Capital Markets. Please note that while macro conditions are considered when we determine valuation estimates for individual companies, our country and industry weightings are aby-product ofbottom-up stock selection, not the result oftop-down observations.

Brandes Investment Partners has had the same goal since we started 45 years ago: Realize above-market gains to help you pursue your long-term investment objectives. We aim to do so by staying true to our value approach, which seeks fundamentally sound but potentially undervalued companies for the Fund.

Thank you for your business and continued trust.

Sincerely yours,

The Brandes GlobalLarge-Cap Investment Committee

Brandes Investment Trust

Because the values of the fund’s investments will fluctuate with market conditions, so will the value of your investment in the fund. You could lose money on your investment in the fund, or the fund could underperform other investments. The values of the fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. In addition, the performance of foreign securities depends on the political and economic environments and other overall economic conditions in the countries where the fund invests. Emerging

 

13


Brandes Global Equity Income Fund

 

country markets involve greater risk and volatility than more developed markets. Some emerging markets countries may have fixed or managed currencies that are not free-floating against the U.S. dollar. Certain of these currencies have experienced, and may experience in the future, substantial fluctuations or a steady devaluation relative to the U.S. dollar. Value stocks typically are less volatile than growth stocks; however, issues of value stocks typically have a lower expected growth rate in earnings and sales than issues of growth stocks.

Past performance is not a guarantee of future results.

Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.

The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.

Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.

Must be preceded or accompanied by a prospectus.

Index Guide

The MSCI World Index with net dividends captures large and mid cap representation of developed markets.

MSCI has not approved, reviewed or produced this report, makes no express or implied warranties or representations and is not liable whatsoever for any data in the report. You may not redistribute the MSCI data or use it as a basis for other indices or investment products.

One cannot invest directly in an index.

The Brandes Global Equity Income Fund is distributed by ALPS Distributors, Inc.

 

14


Brandes Global Equity Income Fund

 

 

The following chart compares the value of a hypothetical $100,000 investment in the Brandes Global Equity Income Fund – Class I from its inception (December 31, 2014) to September 30, 2019 with the value of such an investment in the MSCI World Index for the same period.

Value of $100,000 Investment vs MSCI World Index (Unaudited)

 

LOGO

 

   Average Annual Total Return
Periods Ended September 30, 2019
 
   One
Year
  Three
Years
  Since
Inception(1)
 

Brandes Global Equity Income Fund

    

Class A

   -2.29  6.02  6.76

Class A (with maximum sales charge)

   -7.91  3.95  5.44

Class C

   -2.91  4.95  5.70

Class C (with maximum sales charge)

   -3.83  4.95  5.70

Class I

   -2.09  5.69  6.50

MSCI World Index

   1.83  10.21  7.35

 

(1) 

The inception date is December 31, 2014.

Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.

 

15


Brandes Global Equity Income Fund

 

The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Advisor has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.

Sector Allocation as a Percentage of Total Investments as of September 30, 2019 (Unaudited)

 

LOGO

The sector classifications represented in the graph above are in accordance with Global Industry Classification Standard (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC.

 

16


Brandes Emerging Markets Value Fund

 

Dear Fellow Investor,

The net asset value of the Brandes Emerging Markets Value Fund (Class I Shares) increased 3.41% in the year ending September 30, 2019. For the same period, the MSCI Emerging Markets Index fell 2.02%.

Portfolio holdings in the Banks, Diversified Consumer Services and Oil, Gas & Consumable Fuels industries were contributors to performance, while holdings in Construction Materials, Hotels, Restaurants & Leisure and Multiline Retail detracted from returns.

Holdings in Brazil, Russia and Indonesia contributed to performance, while results were hampered by holdings in Argentina, Mexico and Hong Kong.

Three of the largest individual contributors to performance were Marfrig Alimentos SA (Brazil — Food Products), X5 Retail Group NV (Russia — Food & Staples Retailing) and PT BANK RAKYAT INDONESIA (Indonesia — Banks). Cemex SA (Mexico — Construction Materials), YPF Sociedad Anonima (Argentina — Oil, Gas & Consumable Fuels) and Genting Bhd (Malaysia — Hotels, Restaurants & Leisure) were three of the largest detractors from performance.

At the close of the period, the Fund’s largest country weights were in China and South Korea, and the Fund’s largest industry weights were in Banks and Wireless Telecommunication Services. Please note that while macro conditions are considered when we determine valuation estimates for individual companies, our country and industry weightings are aby-product ofbottom-up stock selection, not the result oftop-down observations.

In the45-plus years since Brandes Investment Partners was founded, our goal has remained the same: pursue above-market gains to help you move closer to your long-term investment objectives. We believe that our unwavering commitment to value investing will lead us to attractively priced, fundamentally sound companies worthy of inclusion in the fund.

Thank you for your business and continued trust.

Sincerely yours,

The Brandes Emerging Markets Investment Committee

Brandes Investment Trust

Because the values of the fund’s investments will fluctuate with market conditions, so will the value of your investment in the fund. You could lose money on your investment in the fund, or the fund could underperform other investments. The values of the fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. In addition, the performance of foreign securities depends on the political and economic environments and other overall

 

17


Brandes Emerging Markets Value Fund

 

economic conditions in the countries where the fund invests. Emerging country markets involve greater risk and volatility than more developed markets. Some emerging markets countries may have fixed or managed currencies that are not free-floating against the U.S. dollar. Certain of these currencies have experienced, and may experience in the future, substantial fluctuations or a steady devaluation relative to the U.S. dollar. Investments in small and medium capitalization companies tend to have limited liquidity and greater price volatility than investments in larger capitalization companies. Value stocks typically are less volatile than growth stocks; however, issues of value stocks typically have a lower expected growth rate in earnings and sales than issues of growth stocks.

Past performance is not a guarantee of future results.

Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.

The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.

Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.

Must be preceded or accompanied by a prospectus.

Index Guide

The MSCI Emerging Markets Index with net dividends captures large and mid cap representation of emerging market countries.

MSCI has not approved, reviewed or produced this report, makes no express or implied warranties or representations and is not liable whatsoever for any data in the report. You may not redistribute the MSCI data or use it as a basis for other indices or investment products.

One cannot invest directly in an index.

The Brandes Emerging Markets Value Fund is distributed by ALPS Distributors, Inc.

 

18


Brandes Emerging Markets Value Fund

 

The following chart compares the value of a hypothetical $100,000 investment in the Brandes Emerging Markets Value Fund – Class I from September 30, 2009 to September 30, 2019 with the value of such an investment in the MSCI Emerging Markets Index for the same period.

Value of $100,000 Investment vs MSCI Emerging Markets Index (Unaudited)

 

LOGO

 

   Average Annual Total Return
Periods Ended September 30, 2019**
 
   One
Year
  Five
Years
  Ten
Years
  Since
Inception(1)
 

Brandes Emerging Markets Value Fund

     

Class A

   3.10  -0.02  3.50  6.89

Class A (with maximum sales charge)

   -2.83  -1.20  2.89  6.62

Class C*

   2.27  -0.77  2.73  6.06

Class C* (with maximum sales charge)

   1.27  -0.77  2.73  6.06

Class I

   3.41  0.24  3.76  7.13

Class R6*

   3.45  0.36  3.84  7.20

MSCI Emerging Markets Index

   -2.02  2.33  3.37  5.82

 

(1) 

The inception date is August 20, 1996.

 

*

Performance shown prior to January 31, 2013 for Class C shares reflects the performance of Class I shares adjusted to reflect Class C expenses. Performance shown prior to July 11, 2016 for Class R6 shares reflects the performance of Class I shares adjusted to reflect Class R6 expenses.

 

**

Prior to January 31, 2011, the Advisor managed a private investment fund with an investment objective, investment policies and strategies that were, in all material respects, equivalent to those of the Brandes Emerging Markets Value Fund. The performance information shown for the Class I shares for periods before January 31, 2011 is that of the private investment fund and reflects the net expenses of the private investment fund. The performance of the private investment fund prior to January 31, 2011 is based on a calculation method that is different from the standardized calculation method prescribed by the SEC. The performance information shown for the Class A shares has been adjusted to reflect the differences in the net expense ratios between the Class I and A shares. The private investment fund was not registered under the Investment Company Act of 1940 (“1940 Act”) and was not subject to certain

 

19


Brandes Emerging Markets Value Fund

 

 investment limitations, diversification requirements, and other restrictions imposed by the 1940 Act and the Internal Revenue Code of 1986, which, if applicable, may have adversely affected its performance.

Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.

The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Advisor has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.

Sector Allocation as a Percentage of Total Investments as of

September 30, 2019 (Unaudited)

 

LOGO

The sector classifications represented in the graph above are in accordance with Global Industry Classification Standard (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC.

 

20


Brandes International Small Cap Equity Fund

 

Dear Fellow Investor,

The net asset value of the Brandes International Small Cap Equity Fund (Class I Shares) fell 11.93% in the year ending September 30, 2019. For the same period, the S&P DevelopedEx-U.S. SmallCap Index declined 7.35%.

Portfolio holdings in the Electric Utilities, Equity Real Estate Investment Trusts (REITs) and Trading Cos. & Distributors industries were contributors to performance, while holdings in Household Durables, Food & Staples Retailing and Real Estate Management & Development detracted from returns.

Holdings in Brazil, Ireland and Italy contributed to performance, while results were hampered by holdings in United Kingdom, Canada and South Korea.

Three of the largest individual contributors to performance were CIA Paranaense de Energia (Brazil — Electric Utilities), C&C Group PLC (Ireland — Beverages) and Fibra Uno Admin. SA de C.V. (Mexico — Equity Real Estate Investment Trusts (REITs)). Dorel Industries Inc. (Canada — Household Durables), De La Rue Plc (United Kingdom — Commercial Services & Supplies) and Countrywide PLC (United Kingdom — Real Estate Management & Development) were three of the largest detractors from performance.

At the close of the period, the Fund’s largest country weights were in Japan and United Kingdom, and the Fund’s largest industry weights were in Food & Staples Retailing and Banks. Please note that while macro conditions are considered when we determine valuation estimates for individual companies, our country and industry weightings are aby-product ofbottom-up stock selection, not the result oftop-down observations.

After nearly a half-century of professional investing, Brandes Investment Partners remains fixed on its original goal. We pursue above-market returns to help you fulfill your long-term investment objectives. Our approach remains deeply rooted in the value philosophy and seeks to identify worthy but potentially underpriced companies. Thank you for your confidence in our approach.

Thank you for your business and continued trust.

Sincerely yours,

The BrandesSmall-Cap Investment Committee

Brandes Investment Trust

Because the values of the fund’s investments will fluctuate with market conditions, so will the value of your investment in the fund. You could lose money on your investment in the fund, or the fund could underperform other investments. The values of the fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. In addition, the performance of foreign securities depends on the political and economic environments and other overall

 

21


Brandes International Small Cap Equity Fund

 

economic conditions in the countries where the fund invests. Emerging country markets involve greater risk and volatility than more developed markets. Some emerging markets countries may have fixed or managed currencies that are not free-floating against the U.S. dollar. Certain of these currencies have experienced, and may experience in the future, substantial fluctuations or a steady devaluation relative to the U.S. dollar. Investments in small and medium capitalization companies tend to have limited liquidity and greater price volatility than investments in larger capitalization companies. Value stocks typically are less volatile than growth stocks; however, issues of value stocks typically have a lower expected growth rate in earnings and sales than issues of growth stocks.

Past performance is not a guarantee of future results.

Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.

The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.

Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.

Must be preceded or accompanied by a prospectus.

Index Guide

The S&P DevelopedEx-U.S. SmallCap Index with net dividends measures the equity performance of small-capitalization companies from developed markets excluding the United States.

One cannot invest directly in an index.

The Brandes International Equity Small Cap Equity Fund is distributed by ALPS Distributors, Inc.

 

22


Brandes International Small Cap Equity Fund

 

The following chart compares the value of a hypothetical $100,000 investment in the Brandes International Small Cap Fund – Class I from September 30, 2009 to September 30, 2019 with the value of such an investment in the S&P DevelopedEx-U.S. SmallCap Index for the same period.

Value of $100,000 Investment vs S&P Developed

Ex-U.S. SmallCap Index (Unaudited)

 

LOGO

 

   Average Annual Total Return
Periods Ended September 30, 2019**
 
   One
Year
  Five
Years
  Ten
Years
  Since
Inception(1)
 

Brandes International Small Cap Fund

     

Class A

   -12.04  -0.83  6.00  8.04

Class A (with maximum sales charge)

   -17.10  -2.00  5.37  7.77

Class C*

   -12.69  -1.55  5.21  7.24

Class C* (with maximum sales charge)

   -13.53  -1.55  5.21  7.24

Class I

   -11.93  -0.64  6.22  8.30

Class R6*

   -11.80  -0.55  6.30  8.36

S&P Developed Ex-U.S. SmallCap Index

   -7.35  4.80  6.75  6.35

 

(1) 

The inception date is August 19, 1996.

 

*

Performance shown prior to January 31, 2013 for Class C shares reflects the performance of Class I shares adjusted to reflect Class C expenses. Performance shown prior to June 27, 2016 for Class R6 shares reflects the performance of Class I shares adjusted to reflect Class R6 expenses.

 

**

Prior to February 1, 2012, the Advisor managed a private investment fund with an investment objective, investment policies and strategies that were, in all material respects, equivalent to those of the Brandes International Small Cap Fund. The performance information shown for the Class I shares for periods before February 1, 2012 is that of the private investment fund and reflects the net expenses of the private investment fund. The performance of the private investment fund prior to February 1, 2012 is based on a calculation method that is different from the standardized calculation method prescribed by the SEC. The performance information shown for the Class A shares has been adjusted to reflect the differences in the net expense ratios between the Class I and A shares. The private investment fund was not registered under the Investment Company Act of 1940 (“1940 Act”) and was not subject to certain investment limitations, diversification requirements, and other restrictions imposed by the 1940 Act and the Internal Revenue Code of 1986, which, if applicable, may have adversely affected its performance.

 

23


Brandes International Small Cap Equity Fund

 

Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.

The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The Advisor has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.

Sector Allocation as a Percentage of Total Investments as of

September 30, 2019 (Unaudited)

 

LOGO

The sector classifications represented in the graph above are in accordance with Global Industry Classification Standard (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC.

 

24


Brandes Small Cap Value Fund

 

Dear Fellow Investor,

The net asset value of the Brandes Small Cap Value Fund (Class I Shares) declined 8.13% in the year ending September 30, 2019. For the same period, the Russell 2000 Index fell 8.89% while the Russell 2000 Value Index dropped 8.24%.

Portfolio holdings in the Specialty Retail, Capital Markets and Biotechnology industries were contributors to performance, while holdings in Machinery, Health Care Providers & Services and Communications Equipment detracted from returns.

Three of the largest individual contributors to performance were Taylor Morrison Home Corp (Household Durables),Rent-A-Center Inc (Specialty Retail) and World Fuel Services Corp (Oil, Gas & Consumable Fuels). Briggs & Stratton Corp (Machinery), Edgewell Personal Care (Personal Products) and CSS Industries Inc (Household Durables) were three of the largest detractors from performance.

At the close of the period, the Fund’s largest industry weights were in Household Durables and Biotechnology. Please note that while macro conditions are considered when we determine valuation estimates for individual companies, our industry weightings are aby-product ofbottom-up stock selection, not the result oftop-down observations.

For 45 years, Brandes Investment Partners has had the same goal: Seek better-than-market returns to help you pursue your long-term investment goals. We believe steadfast adherence to our value investing approach can help us achieve this aim because it compels us to invest in companies we view as strong yet appealingly priced. We thank you for your confidence and for investing with us.

Thank you for your business and continued trust.

Sincerely yours,

The BrandesSmall-Cap Investment Committee

Brandes Investment Trust

Because the values of the fund’s investments will fluctuate with market conditions, so will the value of your investment in the fund. You could lose money on your investment in the fund, or the fund could underperform other investments. The values of the fund’s investments fluctuate in response to the activities of individual companies and general stock market and economic conditions. Investments in small and medium capitalization companies tend to have limited liquidity and greater price volatility than investments in larger capitalization companies. Value stocks typically are less volatile than growth stocks; however, issues of value stocks typically have a lower expected growth rate in earnings and sales than issues of growth stocks.

 

25


Brandes Small Cap Value Fund

 

Past performance is not a guarantee of future results.

Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.

The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.

Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.

Must be preceded or accompanied by a prospectus.

Index Guide

The Russell 2000 Index with gross dividends measures the performance of the small cap segment of the U.S. equity universe.

The Russell 2000 Value Index with gross dividends measures performance of the small cap value segment of the U.S. equity universe. Securities are categorized as growth or value based on their relativebook-to-price ratios, historical sales growth, and expected earnings growth.

One cannot invest directly in an index.

The Brandes Small Cap Value Fund is distributed by ALPS Distributors, Inc.

 

26


Brandes Small Cap Value Fund

 

The following chart compares the value of a hypothetical $100,000 investment in the Brandes Small Cap Value Fund – Class I from September 30, 2009 to September 30, 2019 with the value of such an investment in the Russell 2000 Total Return Index for the same period.

Value of $100,000 Investment vs Russell 2000 Total Return Index (Unaudited)

 

LOGO

 

   Average Annual Total Return
Periods Ended September 30, 2019*
 
   One
Year
  Five
Years
  Ten
Years
  Since
Inception(1)
 

Brandes Small Cap Value Fund

     

Class A

   -8.53  6.76  11.74  6.30

Class A (with maximum sales charge)

   -13.82  -5.50  11.80  6.01

Class I

   -8.13  7.06  12.04  6.57

Class R6

   -15.36  5.43  11.18  6.20

Russell 2000 Total Return Index

   -8.89  8.19  11.19  7.06

 

(1) 

The inception date is September 30, 1997.

 

*

Prior to January 2, 2018, the Advisor managed a private investment fund with an investment objective, investment policies and strategies that were, in all material respects, equivalent to those of the Brandes Small Cap Value Fund. The performance information shown for the Class I shares for periods before January 2, 2018 is that of the private investment fund and reflects the net expenses of the private investment fund. The performance of the private investment fund prior to January 2, 2018 is based on a calculation method that is different from the standardized calculation method prescribed by the SEC. The performance information shown for the Class A shares has been adjusted to reflect the differences in the net expense ratios between the Class I and A shares. Performance shown prior to January 2, 2018 for Class R6 shares reflects the performance of Class I shares. The private investment fund was not registered under the Investment Company Act of 1940 (“1940 Act”) and was not subject to certain investment limitations, diversification requirements, and other restrictions imposed by the 1940 Act and the Internal Revenue Code of 1986, which, if applicable, may have adversely affected its performance.

 

27


Brandes Small Cap Value Fund

 

Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.

The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The Advisor has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.

Sector Allocation as a Percentage of Total Investments as of

September 30, 2019 (Unaudited)

 

LOGO

The sector classifications represented in the graph above are in accordance with Global Industry Classification Standard (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC.

 

28


Brandes Core Plus Fixed Income Fund

 

Dear Fellow Investor,

The net asset value of the Brandes Core Plus Fixed Income Fund (Class I Shares) gained 6.85% in the year ending September 30, 2019. For the same period, the Bloomberg Barclays Aggregate Bond Index increased 10.30%.

Relative performance was hurt by corporate bond investments in energy and telecommunications.

Within energy, unease about a global slowdown and an oversupply of oil and natural gas has caused underperformance throughout the sector. More specifically, bonds from Chesapeake Energy and Range Resources detracted from returns as the market expressed its concerns about debt levels from energy companies operating in the high-yield space.

The short-term sentiment, particularly regarding natural gas, has been decidedly negative, primarily as a result of abundant supply. However, the longer-term fundamentals are more positive. Based on our analysis, natural gas is capturing 70% of energy needs from coal plant retirements versus 30% for renewables. Export capacity is increasing: liquefied natural gas export terminals are coming online, and a new pipeline recently placed into service will increase export capacity to Mexico. Finally, investor demands for more capital discipline should serve to restrain volume growth.

During the third quarter 2019, Chesapeake engaged in two transactions that saw debt holders voluntarily swap $733 million in debt for common equity. During the past few years, Chesapeake has opportunistically extended debt maturities to lengthen their runway during a downturn; it has now turned its focus on debt reduction through equity swaps and possible asset sales. Chesapeake has been shifting their product mix toward higher margin oil, which should aid cash flow going forward.

In the telecommunications sector, Frontier Communications detracted from returns. Earlier this year, the company took positive steps to address balance sheet returns, including buying $56 million of its debt in the open market below par value and issuing $1.65 billion first-lien bonds maturing in 2027. Proceeds from the issuance were used to refinance a term loan set to mature in 2021. Frontier also announced an asset sale for $1.35 billion, with proceeds earmarked for additional debt reduction when the transaction closes.

Frontier continues to generate positive free cash flow and with the transactions highlighted above, has a visible path to paying down its maturities for the next three years (we own bonds with a scheduled maturity in 2021). However, its bond prices, continued to move lower in the quarter because a number of investors who own longer-maturity Frontier debt began agitating for the company to undertake a more comprehensive debt restructuring as the path to repay debt maturing in 2023 and beyond is far less certain.

 

29


Brandes Core Plus Fixed Income Fund

 

Given the sharp decline in interest rates, the Fund’s duration positioning toward the lower end of our duration-controlled band also detracted from returns.

Finally, the Fund’s defensive positioning in corporate bonds hurt relative performance. We have been favoring shorter maturity corporate bonds — the duration of our corporate bond exposure is under three years — with credit spreads at or near the tightest levels relative to U.S. Treasuries in decades. During the period, Intermediate maturity corporate bonds outperformed shorter maturity corporates.Year-to-date, the outperformance is quite stark as7- to10-year maturities delivered over 350bps more in return versus U.S. Treasury securities than corporate bonds with1- to3-year maturities.

The Fund received positive contributions more recently from Tenet Healthcare, which was subject to an early call at a premium, Pilgrim’s Pride Corp, and select holdings in banking (JPMorgan and U.S. Bank).

We increased our weight in agency mortgage-backed securities (MBS), as their performance lagged the broader market. The increase in overall market volatility and continued runoff of the Fed’s balance sheet agency MBS holdings, at about $200 billion over the past 12 months, caused yield spreads in the agency MBS market to widen to their highest levels in more than five years recently.

While we remain underweight agency MBS, we will consider additional purchases if recent weakness persists.

Toward the close of the period ending September 30, 2019, U.S. economic data reports were mixed. Economic reports about consumer spending — which represents abouttwo-thirds of the economy — have been largely positive. Manufacturing reports, however, have begun to show more weakness — understandable against the uncertainty of the ongoing trade war.

In this environment, the Brandes Core Plus Fixed Income Fund favors shorter maturity corporate bonds and those that, in our view, exhibit strong, tangible asset coverage. Although we added to our position during the period, we remain underweight agency MBS and we’ve been managing duration toward the shorter end of our duration-controlled range. We have a higher allocation to U.S. Treasuries that we will look to redeploy thoughtfully and efficiently — if and when market uncertainty and volatility cause credit fundamentals to become mispriced from our estimates of intrinsic value.

As always, thank you for your business and continued trust.

Sincerely yours,

The Brandes Fixed Income Investment Committee

Brandes Investment Trust

Because the values of the fund’s investments will fluctuate with market conditions, so will the value of your investment in the fund. You could lose

 

30


Brandes Core Plus Fixed Income Fund

 

money on your investment in the fund, or the fund could underperform other investments. The values of the fund’s investments fluctuate in response to the activities of individual companies and general bond market and economic conditions. Investments in small and medium capitalization companies tend to have limited liquidity and greater price volatility than large capitalization companies.

As with most fixed income funds, the income on and value of your shares in the fund will fluctuate along with interest rates. When interest rates rise, the market prices of the debt securities the fund owns usually decline. When interest rates fall, the prices of these securities usually increase. Generally, the longer the fund’s average portfolio maturity and the lower the average quality of its portfolio, the greater the price fluctuation. The price of any security owned by the fund may also fall in response to events affecting the issuer of the security, such as its ability to continue to make principal and interest payments or its credit rating. Below investment grade debt securities are speculative and involve a greater risk of default and price change due to changes in the issuer’s creditworthiness than higher grade debt. The market prices of these debt securities may fluctuate more than the market prices of investment grade debt securities and may decline significantly in periods of general economic difficulty.

Past performance is not a guarantee of future results.

Short-term debt refers to fixed income securities set to mature more 1 to 5 years from the issue or purchase date. Long-term debt refers to fixed income securities set to mature more than 10 years from the issue or purchase date.

Asset Coverage:  A company’s ability to cover debt obligations with its assets after all liabilities have been satisfied. Source: Investopedia.com

Basis Point:  1/100 of 1%.

Duration:  The weighted maturity of a fixed-income investment’s cash flows, used in the estimation of the price sensitivity of fixed-income securities for a given change in interest rates.

Free Cash Flow:  Total cash flow from operations less capital expenditures.

Yield:  Annual income from the investment (dividend, interest, etc.) divided by the current market price of the investment.

Yield Spread:  The difference in yield from a Treasury security and another debt security of the same maturity.

Please refer to the Schedule of Investments in the report for complete holdings information. Fund holdings, geographic allocations and/or sector allocations are subject to change at any time and are not considered a recommendation to buy or sell any security.

 

31


Brandes Core Plus Fixed Income Fund

 

The foregoing reflects the thoughts and opinions of Brandes Investment Partners® exclusively and is subject to change without notice.

Brandes Investment Partners® is a registered trademark of Brandes Investment Partners, L.P. in the United States and Canada.

Must be preceded or accompanied by a prospectus.

Index Guide

The Bloomberg Barclays U.S. Aggregate Bond Index is a broad-based benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market. This index is a total return index which reflects the price changes and interest of each bond in the index.

One cannot invest directly in an index.

The Brandes Core Plus Fixed Income Fund is distributed by ALPS Distributors, LLC.

 

32


Brandes Core Plus Fixed Income Fund

 

The following chart compares the value of a hypothetical $100,000 investment in the Brandes Core Plus Fixed Income Fund – Class I from September 30, 2009 to September 30, 2019 with the value of such an investment in the Bloomberg Barclays U.S. Aggregate Bond Index for the same period.

Value of $100,000 Investment vs Bloomberg Barclays U.S. Aggregate Bond Index (Unaudited)

 

LOGO

 

   Average Annual Total Return
Periods Ended September 30, 2019
 
   One
Year
  Five
Years
  Ten
Years
  Since
Inception(1)
 

Brandes Core Plus Fixed Income Fund

     

Class A*

   6.56  2.53  4.29  3.54

Class A* (with maximum sales charge)

   2.61  1.75  3.89  3.20

Class I

   6.85  2.79  4.60  3.83

Class R6*

   7.40  3.13  4.80  4.01

Bloomberg Barclays U.S. Aggregate Bond Index

   10.30  3.38  3.75  4.15

 

(1) 

The inception date is December 28, 2007.

 

*

Performance shown prior to January 31, 2013 for Class A shares reflects the performance of Class I shares adjusted to reflect Class A expenses. Performance shown prior to October 10, 2017 for Class R6 shares reflects the performance of Class I shares adjusted to reflect Class R6 expenses.

Performance data quoted represents past performance; past performance does not indicate future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 800-331-2979.

 

33


Brandes Core Plus Fixed Income Fund

 

The returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of Fund shares. The Advisor has a fee waiver arrangement in place to limit the Fund’s annual operating expenses.

Asset Allocation as a Percentage of Total Investments as of

September 30, 2019 (Unaudited)

 

LOGO

 

34


Brandes Investment Trust

 

Expense Example (Unaudited)

As a shareholder of a Fund, you incur ongoing costs, including investment advisory and administrative fees and other fund expenses. The examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with ongoing costs of investing in other mutual funds.

The examples are based on an investment of $1,000 invested at the beginning of the period and held for the entire period from April 1, 2019 to September 30, 2019 (the “Period”).

Actual Expenses

This section provides information about actual account values and actual expenses. The “Ending Account Value” shown is derived from each Fund’s actual return. You may use the information in this section, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number given for the Fund under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

 

  Class A 

Fund

 Beginning
Account
Value
  Ending
Account
Value
  Annualized
Expense
Ratio
  Expenses
Paid
During
the Period*
 

International Equity Fund

 $1,000.00  $990.60   1.16%  $5.79 

Global Equity Fund

 $1,000.00  $1,001.40   1.25%  $6.27 

Global Equity Income Fund

 $1,000.00  $997.40   1.25%  $6.26 

Emerging Markets Value Fund

 $1,000.00  $1,007.60   1.35%  $6.79 

International Small Cap Fund

 $1,000.00  $956.20   1.33%  $6.52 

Small Cap Value Fund

 $1,000.00  $997.40   1.15%  $5.76 

Core Plus Fixed Income Fund

 $1,000.00  $1,033.20   0.70%  $3.57 

 

  Class C 

Fund

 Beginning
Account
Value
  Ending
Account
Value
  Annualized
Expense
Ratio
  Expenses
Paid
During
the Period*
 

International Equity Fund

 $1,000.00  $987.10   1.91%  $9.51 

Global Equity Fund

 $1,000.00  $997.50   2.00%  $10.01 

Global Equity Income Fund

 $1,000.00  $994.50   2.00%  $10.00 

Emerging Markets Value Fund

 $1,000.00  $1,003.70   2.09%  $10.50 

International Small Cap Fund

 $1,000.00  $953.00   2.09%  $10.23 

 

35


Brandes Investment Trust

 

 

  Class I 

Fund

 Beginning
Account
Value
  Ending
Account
Value
  Annualized
Expense
Ratio
  Expenses
Paid
During
the Period*
 

International Equity Fund

 $1,000.00  $991.70   0.90%  $4.49 

Global Equity Fund

 $1,000.00  $1,002.40   1.00%  $5.02 

Global Equity Income Fund

 $1,000.00  $998.30   1.00%  $5.01 

Emerging Markets Value Fund

 $1,000.00  $1,008.50   1.12%  $5.64 

International Small Cap Fund

 $1,000.00  $956.50   1.15%  $5.64 

Small Cap Value Fund

 $1,000.00  $1,000.00   0.90%  $4.51 

Core Plus Fixed Income Fund

 $1,000.00  $1,034.00   0.50%  $2.55 

 

  Class R6 

Fund

 Beginning
Account
Value
  Ending
Account
Value
  Annualized
Expense
Ratio
  Expenses
Paid
During
the Period*
 

International Equity Fund

 $1,000.00  $992.60   0.78%  $3.90 

Emerging Markets Value Fund

 $1,000.00  $1,009.90   0.97%  $4.89 

International Small Cap Fund

 $1,000.00  $956.50   1.00%  $4.91 

Small Cap Value Fund

 $1,000.00  $920.80   0.72%  $3.47 

Core Plus Fixed Income Fund

 $1,000.00  $1,036.30   0.35%  $1.79 

 

*

Expenses are equal to the Fund’s expense ratio for the period, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

Hypothetical Example for Comparison Purposes

This section provides information about hypothetical account values and hypothetical expenses based on the Funds’ actual expense ratios and an assumed rate of return of 5% per year before expenses, which are not the Funds’ actual returns. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Funds and other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other mutual funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as brokerage commissions on purchase and sales of Fund shares. Therefore, the last column of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

 

36


Brandes Investment Trust

 

 

  Class A 

Fund

 Beginning
Account
Value
  Ending
Account
Value
  Annualized
Expense
Ratio
  Expenses
Paid
During
the Period*
 

International Equity Fund

 $1,000.00  $1,019.25   1.16%  $5.87 

Global Equity Fund

 $1,000.00  $1,018.80   1.25%  $6.33 

Global Equity Income Fund

 $1,000.00  $1,018.80   1.25%  $6.33 

Emerging Markets Value Fund

 $1,000.00  $1,018.30   1.35%  $6.83 

International Small Cap Fund

 $1,000.00  $1,018.40   1.33%  $6.73 

Small Cap Value Fund

 $1,000.00  $1,019.30   1.15%  $5.82 

Core Plus Fixed Income Fund

 $1,000.00  $1,021.56   0.70%  $3.55 

 

  Class C 

Fund

 Beginning
Account
Value
  Ending
Account
Value
  Annualized
Expense
Ratio
  Expenses
Paid
During
the Period*
 

International Equity Fund

 $1,000.00  $1,015.49   1.91%  $9.65 

Global Equity Fund

 $1,000.00  $1,015.04   2.00%  $10.10 

Global Equity Income Fund

 $1,000.00  $1,015.04   2.00%  $10.10 

Emerging Markets Value Fund

 $1,000.00  $1,014.59   2.09%  $10.56 

International Small Cap Fund

 $1,000.00  $1,014.59   2.09%  $10.56 

 

  Class I 

Fund

 Beginning
Account
Value
  Ending
Account
Value
  Annualized
Expense
Ratio
  Expenses
Paid
During
the Period*
 

International Equity Fund

 $1,000.00  $1,020.56   0.90%  $4.56 

Global Equity Fund

 $1,000.00  $1,020.05   1.00%  $5.06 

Global Equity Income Fund

 $1,000.00  $1,020.05   1.00%  $5.06 

Emerging Markets Value Fund

 $1,000.00  $1,019.45   1.12%  $5.67 

International Small Cap Fund

 $1,000.00  $1,019.30   1.15%  $5.82 

Small Cap Value Fund

 $1,000.00  $1,020.56   0.90%  $4.56 

Core Plus Fixed Income Fund

 $1,000.00  $1,022.56   0.50%  $2.54 

 

  Class R6 

Fund

 Beginning
Account
Value
  Ending
Account
Value
  Annualized
Expense
Ratio
  Expenses
Paid
During
the Period*
 

International Equity Fund

 $1,000.00  $1,021.16   0.78%  $3.95 

Emerging Markets Value Fund

 $1,000.00  $1,020.21   0.97%  $4.91 

International Small Cap Fund

 $1,000.00  $1,020.05   1.00%  $5.06 

Small Cap Value Fund

 $1,000.00  $1,021.46   0.72%  $3.65 

Core Plus Fixed Income Fund

 $1,000.00  $1,023.31   0.35%  $1.78 

 

*

Expenses are equal to the Fund’s expense ratio for the period, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

 

37


Brandes International Equity Fund

SCHEDULE OF INVESTMENTS — September 30, 2019

 

 

 

Shares     Value 
 COMMON STOCKS – 92.87% 
 Brazil – 1.84% 
 750,182  Embraer SA Sponsored – ADR $12,940,640 
  

 

 

 
 China – 1.46% 
 1,241,000  China Mobile Ltd.  10,280,136 
  

 

 

 
 Finland – 1.62% 
 2,255,736  Nokia OYJ  11,392,193 
  

 

 

 
 France – 18.24% 
 1,001,334  Carrefour SA  17,515,666 
 360,304  Compagnie de Saint-Gobain SA  14,121,344 
 1,220,263  Engie SA  19,917,406 
 701,975  Orange SA  10,987,312 
 298,091  Publicis Groupe SA  14,667,691 
 119,629  Renault SA  6,865,904 
 308,608  Sanofi  28,587,325 
 102,505  Schneider Electric SE  8,963,284 
 46,177  Societe BIC SA  3,100,377 
 68,054  Total SA  3,543,362 
  

 

 

 
   128,269,671 
  

 

 

 
 Germany – 1.57% 
 158,377  BASF SE  11,073,453 
  

 

 

 
 Hong Kong – 0.65% 
 11,842,000  First Pacific Co. Ltd.  4,533,422 
  

 

 

 
 Ireland – 1.87% 
 384,232  CRH Plc  13,175,313 
  

 

 

 
 Italy – 6.40% 
 968,468  Eni SpA  14,802,860 
 5,328,543  Intesa Sanpaolo SpA(a)  12,622,404 
 30,748,839  Telecom Italia Rsp  16,819,646 
 1,365,052  Telecom Italia SpA  779,429 
  

 

 

 
   45,024,339 
  

 

 

 
 Japan – 14.90% 
 542,400  Dai Nippon Printing Co. Ltd.  14,070,386 
 456,200  Honda Motor Co. Ltd.  11,945,344 
 1,103,700  Mitsubishi Tanabe Pharma Corp.  12,163,123 
 2,734,800  Mitsubishi UFJ Financial Group, Inc.  13,927,959 
 471,999  MS&AD Insurance Group Holdings, Inc.  15,341,930 
Shares     Value 
 760,700  Nissan Motor Co. Ltd. $4,749,321 
 364,800  Sumitomo Mitsui Trust Holdings, Inc.  13,210,102 
 72,000  Taisho Pharmaceutical Holdings Co. Ltd.  5,264,657 
 410,683  Takeda Pharmaceutical Co. Ltd.  14,092,867 
  

 

 

 
   104,765,689 
  

 

 

 
 Mexico – 4.37% 
 2,620,613  Cemex SAB de CV Sponsored – ADR(a)  10,272,803 
 13,986,944  Fibra Uno Administracion SA de CV  20,490,653 
  

 

 

 
   30,763,456 
  

 

 

 
 Netherlands – 2.25% 
 2,056,796  Aegon NV(a)  8,542,167 
 66,690  NXP Semiconductors NV  7,277,213 
  

 

 

 
   15,819,380 
  

 

 

 
 Russia – 1.37% 
 1,556,496  Mobile TeleSystems PJSC  6,359,902 
 934,737  Public Joint-Stock Co. Gazprom  3,255,833 
  

 

 

 
   9,615,735 
  

 

 

 
 South Korea – 5.21% 
 181,653  Hana Financial Group, Inc.  5,347,315 
 66,213  Hyundai Mobis Co. Ltd.  13,934,065 
 60,185  Hyundai Motor Co.  6,738,609 
 78,870  KT&G Corp.  6,958,333 
 19,278  POSCO  3,654,297 
  

 

 

 
   36,632,619 
  

 

 

 
 Spain – 1.90% 
 855,737  Repsol SA  13,346,107 
  

 

 

 
 Switzerland – 7.23% 
 1,322,764  Credit Suisse Group AG  16,181,525 
 20,996  Swatch Group Ltd. Bearer  5,574,466 
 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

38


Brandes International Equity Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

Shares     Value 
 79,685  Swatch Group Ltd. Registered $4,004,541 
 90,598  Swiss Resources AG  9,453,340 
 1,377,705  UBS Group AG  15,643,070 
  

 

 

 
   50,856,942 
  

 

 

 
 Taiwan – 1.36% 
 1,436,000  Asustek Computer, Inc.  9,556,349 
  

 

 

 
 United Kingdom – 20.63% 
 5,919,246  Barclays Plc(a)  10,906,162 
 1,792,930  BP Plc  11,350,558 
 4,333,899  G4S Plc  10,093,331 
 1,275,152  GlaxoSmithKline Plc  27,332,245 
 915,298  HSBC Holdings Plc  7,013,215 
 273,504  Imperial Brands Plc  6,141,825 
 4,945,983  J Sainsbury Plc  13,346,163 
 4,889,136  Kingfisher Plc  12,425,118 
 4,179,971  Marks & Spencer Group Plc  9,467,464 
Shares     Value 
 3,632,234  Tesco Plc $10,738,543 
 3,807,408  Wm Morrison Supermarkets Plc  9,374,652 
 1,353,138  WPP Plc  16,943,048 
  

 

 

 
   145,132,324 
  

 

 

 
 

TOTAL COMMON STOCKS
(Cost $783,302,573)

 $653,177,768 
  

 

 

 
 PREFERRED STOCKS – 3.26% 
 Brazil – 1.69% 
 1,028,300  Petroleo Brasileiro SA $6,808,393 
 386,200  Telefonica Brasil SA  5,102,921 
  

 

 

 
   11,911,314 
  

 

 

 
 Russia – 1.57% 
 19,087,950  Surgutneftegas PJSC  11,025,123 
  

 

 

 
 

TOTAL PREFERRED STOCKS
(Cost $16,306,629)

 $22,936,437 
  

 

 

 
 
   Shares  Value 
SHORT-TERM INVESTMENTS – 3.70%

 

Money Market Funds – 3.70%  

BlackRock Liquidity Funds T-Fund – Institutional Class, 1.834%(b)

  26,029,138  $26,029,138 
  

 

 

 

TOTAL SHORT–TERM INVESTMENTS
(Cost $26,029,138)

  $26,029,138 
  

 

 

 

Total Investments (Cost $825,638,340) – 99.83%

  $702,143,343 

Other Assets in Excess of Liabilities – 0.17%

   1,221,133 
  

 

 

 

TOTAL NET ASSETS – 100.00%

  $703,364,476 
  

 

 

 

 

Percentages are stated as a percent of net assets.

ADR American Depository Receipt

(a)

Non–income producing security.

(b)

The rate shown is the annualized seven day yield as of September 30, 2019.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

39


Brandes International Equity Fund

SCHEDULE OF INVESTMENTS BY INDUSTRY — September 30, 2019

 

 

 

COMMON STOCKS

  

Aerospace & Defense

   1.84

Auto Components

   1.98

Automobiles

   4.31

Banks

   8.97

Building Products

   2.01

Capital Markets

   4.52

Chemicals

   1.57

Commercial Services & Supplies

   3.88

Communications Equipment

   1.62

Construction Materials

   3.33

Diversified Financial Services

   0.64

Diversified Telecommunication Services

   4.06

Electrical Equipment

   1.27

Equity Real Estate Investment Trusts

   2.91

Food & Staples Retailing

   7.26

Insurance

   4.74

Media

   4.49

Metals & Mining

   0.52

Multiline Retail

   1.35

Multi-Utilities

   2.83

Oil, Gas & Consumable Fuels

   6.58

Pharmaceuticals

   12.44

Semiconductors & Semiconductor Equipment

   1.03

Specialty Retail

   1.77

Technology Hardware, Storage & Peripherals

   1.36

Textiles, Apparel & Luxury Goods

   1.36

Tobacco

   1.86

Wireless Telecommunication Services

   2.37
  

 

 

 

TOTAL COMMON STOCKS

   92.87
  

 

 

 

PREFERRED STOCKS

  

Diversified Telecommunication Services

   0.73

Oil, Gas & Consumable Fuels

   2.53
  

 

 

 

TOTAL PREFERRED STOCKS

   3.26
  

 

 

 

SHORT-TERM INVESTMENTS

   3.70
  

 

 

 

TOTAL INVESTMENTS

   99.83

Other Assets in Excess of Liabilities

   0.17
  

 

 

 

TOTAL NET ASSETS

   100.00
  

 

 

 

The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC or were otherwise determined by the Adviser to be appropriate. This information is unaudited.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

40


Brandes Global Equity Fund

SCHEDULE OF INVESTMENTS — September 30, 2019

 

 

 

Shares     Value 
 COMMON STOCKS – 96.50% 
 Austria – 1.42% 
 15,451  Erste Group Bank AG $510,651 
  

 

 

 
 Brazil – 2.18% 
 168,920  Embraer SA  730,979 
 3,247  Embraer SA Sponsored – ADR  56,011 
  

 

 

 
   786,990 
  

 

 

 
 China – 1.24% 
 54,000  China Mobile Ltd.  447,323 
  

 

 

 
 Finland – 1.81% 
 129,201  Nokia OYJ  652,507 
  

 

 

 
 France – 14.02% 
 19,278  Carrefour SA  337,217 
 34,611  Engie SA  564,929 
 31,200  Engie SA Registered Shares (Prime Fidelite 2019)  509,253 
 11,504  Publicis Groupe SA  566,059 
 15,242  Sanofi  1,411,914 
 11,535  Schneider Electric SE  1,008,648 
 12,667  Total SA  659,532 
  

 

 

 
   5,057,552 
  

 

 

 
 Ireland – 1.38% 
 14,480  CRH Plc  496,519 
  

 

 

 
 Italy – 2.64% 
 39,071  Eni SpA  597,193 
 653,887  Telecom Italia Rsp  357,677 
  

 

 

 
   954,870 
  

 

 

 
 Japan – 2.98% 
 22,700  Honda Motor Co. Ltd.  594,387 
 77,100  Nissan Motor Co. Ltd.  481,363 
  

 

 

 
   1,075,750 
  

 

 

 
 Malaysia – 1.50% 
 394,700  Genting Berhad  541,339 
  

 

 

 
 Mexico – 2.22% 
 547,053  Fibra Uno Administracion SA de CV  801,424 
  

 

 

 
Shares     Value 
 Netherlands – 1.47% 
 4,857  NXP Semiconductors NV $529,996 
  

 

 

 
 Russia – 0.80% 
 82,434  Public Joint-Stock Co. Gazprom  287,130 
  

 

 

 
 South Korea – 5.84% 
 2,944  Hyundai Mobis Co. Ltd.  619,544 
 5,486  Hyundai Motor Co.  614,239 
 4,364  KT&G Corp.  385,015 
 11,877  Samsung Electronics Co. Ltd.  486,293 
  

 

 

 
   2,105,091 
  

 

 

 
 Spain – 1.36% 
 31,540  Repsol SA  491,899 
  

 

 

 
 Switzerland – 4.57% 
 57,619  Credit Suisse Group AG  704,860 
 2,612  Swiss Resources AG  272,546 
 59,244  UBS Group AG  672,682 
  

 

 

 
   1,650,088 
  

 

 

 
 United Kingdom – 17.63% 
 143,033  Barclays Plc(a)  263,537 
 130,274  BP Plc  824,730 
 64,998  GlaxoSmithKline Plc  1,393,199 
 44,512  HSBC Holdings Plc  341,061 
 29,628  Imperial Brands Plc  665,329 
 177,095  J Sainsbury Plc  477,870 
 196,456  Kingfisher Plc  499,268 
 105,291  Marks & Spencer Group Plc  238,480 
 235,094  Tesco Plc  695,045 
 105,820  Wm Morrison Supermarkets Plc  260,552 
 55,999  WPP Plc  701,180 
  

 

 

 
   6,360,251 
  

 

 

 
 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

41


Brandes Global Equity Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

Shares     Value 
 United States – 33.44% 
 12,966  American International Group, Inc.(a) $722,206 
 25,685  Bank of America Corp.  749,231 
 14,465  Bank of New York Mellon Corp.  653,963 
 17,061  Cardinal Health, Inc.  805,109 
 2,736  Cigna Corp.  415,297 
 19,528  Citigroup, Inc.  1,348,994 
 6,852  CVS Health Corp.  432,156 
 6,778  Emerson Electric Co.  453,177 
 24,045  Halliburton Co.  453,248 
 3,253  HCA Healthcare, Inc.  391,726 
 18,783  Jefferies Financial Group, Inc.  345,607 
 2,867  Laboratory Corp. of America Holdings(a)  481,656 
Shares     Value 
 6,942  McKesson Corp. $948,694 
 9,194  Merck & Co., Inc.  773,951 
 1,973  Microsoft Corp.  274,306 
 1,391  PepsiCo, Inc.  190,706 
 20,873  Pfizer, Inc.  749,967 
 3,436  PNC Financial Services Group, Inc.  481,590 
 8,814  State Street Corp.  521,701 
 17,240  Wells Fargo & Co.  869,586 
  

 

 

 
   12,062,871 
  

 

 

 
 

TOTAL COMMON STOCKS
(Cost $31,247,250)

 $34,812,251 
  

 

 

 
 

PREFERRED STOCKS – 0.36%

 
 South Korea – 0.36% 
 3,912  Samsung Electronics Co. Ltd. $129,131 
  

 

 

 
 

TOTAL PREFERRED
STOCKS
(Cost $115,876)

 $129,131 
  

 

 

 
 
   Shares  Value 
SHORT–TERM INVESTMENTS – 3.57%

 

Money Market Funds – 3.57%  

BlackRock Liquidity Funds T-Fund – Institutional Class, 1.834%(b)

  1,288,678  $1,288,678 
  

 

 

 

TOTAL SHORT-TERM INVESTMENTS
(Cost $1,288,678)

  $1,288,678 
  

 

 

 

Total Investments (Cost $32,651,804) – 100.43%

  $36,230,060 

Liabilites in Escess of Other Assets – (0.43)%

   (158,251
  

 

 

 

TOTAL NET ASSETS – 100.00%

  $36,071,809 
  

 

 

 

 

Percentages are stated as a percent of net assets.

ADR American Depository Receipt

(a)

Non-income producing security.

(b)

The rate shown is the annualized seven day yield as of September 30, 2019.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

42


Brandes Global Equity Fund

SCHEDULE OF INVESTMENTS BY INDUSTRY — September 30, 2019

 

 

 

COMMON STOCKS

  

Aerospace & Defense

   2.18

Auto Components

   1.72

Automobiles

   4.68

Banks

   12.65

Beverages

   0.53

Capital Markets

   7.08

Communications Equipment

   1.81

Construction Materials

   1.38

Diversified Financial Services

   0.96

Diversified Telecommunication Services

   0.99

Electrical Equipment

   4.05

Energy Equipment & Services

   1.26

Equity Real Estate Investment Trusts

   2.22

Food & Staples Retailing

   4.91

Health Care Providers & Services

   9.63

Hotels, Restaurants & Leisure

   1.50

Insurance

   2.76

Media

   3.51

Multiline Retail

   0.66

Multi-Utilities

   2.98

Oil, Gas & Consumable Fuels

   7.93

Pharmaceuticals

   12.00

Semiconductors & Semiconductor Equipment

   1.47

Software

   0.76

Specialty Retail

   1.38

Technology Hardware, Storage & Peripherals

   1.35

Tobacco

   2.91

Wireless Telecommunication Services

   1.24
  

 

 

 

TOTAL COMMON STOCKS

   96.50
  

 

 

 

PREFERRED STOCKS

  

Technology Hardware, Storage & Peripherals

   0.36
  

 

 

 

TOTAL PREFERRED STOCKS

   0.36
  

 

 

 

SHORT-TERM INVESTMENTS

   3.57
  

 

 

 

TOTAL INVESTMENTS

   100.43

Liabilities in Excess of Other Assets

   (0.43)% 
  

 

 

 

TOTAL NET ASSETS

   100.00
  

 

 

 

The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC or were otherwise determined by the Adviser to be appropriate. This information is unaudited.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

43


Brandes Global Equity Income Fund

SCHEDULE OF INVESTMENTS — September 30, 2019

 

 

 

Shares     Value 
 COMMON STOCKS – 86.18% 
 Brazil – 3.07% 
 3,990  Telefonica Brasil SA $43,127 
  

 

 

 
 Chile – 1.47% 
 239,437  Enel Chile SA  20,691 
  

 

 

 
 China – 1.77% 
 3,000  China Mobile Ltd.  24,851 
  

 

 

 
 Finland – 1.62% 
 4,519  Nokia OYJ  22,822 
  

 

 

 
 France – 14.73% 
 1,491  Engie SA  24,337 
 400  Engie SA Registered Shares (Prime Fidelite 2019)  6,529 
 1,092  Engie SA Registered Shares (Prime Fidelite 2021)  17,824 
 590  Publicis Groupe SA  29,031 
 568  Sanofi  52,615 
 528  Schneider Electric SE  46,170 
 590  Total SA  30,719 
  

 

 

 
   207,225 
  

 

 

 
 Italy – 2.43% 
 2,241  Eni SpA  34,253 
  

 

 

 
 Japan – 1.86% 
 1,000  Honda Motor Co. Ltd.  26,184 
  

 

 

 
 Malaysia – 1.38% 
 14,200  Genting Berhad  19,476 
  

 

 

 
 Mexico – 3.60% 
 34,606  Fibra Uno Administracion SA de CV  50,697 
  

 

 

 
 South Korea – 1.63% 
 260  KT&G Corp.  22,939 
  

 

 

 
 Switzerland – 5.31% 
 1,738  Credit Suisse Group AG  21,261 
 240  Swiss Resources AG  25,043 
 2,498  UBS Group AG  28,363 
  

 

 

 
   74,667 
  

 

 

 
 United Kingdom – 22.38% 
 5,875  BP Plc  37,194 
 403  British American Tobacco Plc  14,883 
 2,390  GlaxoSmithKline Plc  51,227 
 2,475  HSBC Holdings Plc  18,964 
Shares     Value 
 1,447  Imperial Brands Plc $32,493 
 6,646  J Sainsbury Plc  17,933 
 12,240  Kingfisher Plc  31,107 
 4,816  Marks & Spencer Group Plc  10,908 
 814  Royal Dutch Shell Plc – Class A  23,873 
 8,470  Tesco Plc  25,042 
 4,210  Wm Morrison Supermarkets Plc  10,366 
 3,261  WPP Plc  40,832 
  

 

 

 
   314,822 
  

 

 

 
 United States – 24.93% 
 312  Bank of New York Mellon Corp.  14,106 
 270  BB&T Corp.  14,410 
 947  Cardinal Health, Inc.  44,689 
 486  Citigroup, Inc.  33,573 
 337  CVS Health Corp.  21,255 
 305  Emerson Electric Co.  20,392 
 166  Johnson & Johnson  21,477 
 475  Merck & Co., Inc.  39,986 
 129  Microsoft Corp.  17,935 
 118  PepsiCo, Inc.  16,178 
 934  Pfizer, Inc.  33,559 
 85  PNC Financial Services Group, Inc.  11,914 
 370  State Street Corp.  21,900 
 781  Wells Fargo & Co.  39,393 
  

 

 

 
   350,767 
  

 

 

 
 

TOTAL COMMON STOCKS
(Cost $1,240,080)

 $1,212,521 
  

 

 

 
 PREFERRED STOCKS – 9.90% 
 South Korea – 1.94% 
 828  Samsung Electronics Co. Ltd. $27,332 
  

 

 

 
 United States – 7.96% 
 1,632  Bank of America Corp. 4.000% (3M LIBOR + 0.500%, minimum of 4.000%)(b)  36,508 
 1,867  Goldman Sachs Group, Inc. 3.750% (3M LIBOR + 0.750%, minimum of 3.750%)(b)  39,020 
 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

44


Brandes Global Equity Income Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

Shares     Value 
 1,668  Morgan Stanley 4.000% (3M LIBOR + 0.700%, minimum of 4.000%)(b) $36,462 
  

 

 

 
   111,990 
  

 

 

 
 

TOTAL PREFERRED STOCKS
(Cost $127,114)

 $139,322 
  

 

 

 
   Shares  Value 
SHORT-TERM INVESTMENTS – 6.85%

 

Money Market Funds – 6.85%  

BlackRock Liquidity Funds T-Fund – Institutional Class, 1.834%(a)

  96,343  $96,343 
  

 

 

 

TOTAL SHORT-TERM INVESTMENTS
(Cost $96,343)

  $96,343 
  

 

 

 

Total Investments (Cost $1,463,537) – 102.93%

  $1,448,186 

Liabilities in Excess of Other Assets – (2.93)%

   (41,247
  

 

 

 

TOTAL NET ASSETS – 100.00%

  $1,406,939 
  

 

 

 

 

Percentages are stated as a percent of net assets.

LIBOR London Inter-bank Offered Rate

(a)

The rate shown is the annualized seven day yield as of September 30, 2019.

(b)

Variable rate security. This coupon is based on a reference index and spread.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

45


Brandes Global Equity Income Fund

SCHEDULE OF INVESTMENTS BY INDUSTRY — September 30, 2019

 

 

 

COMMON STOCKS

  

Automobiles

   1.86

Banks

   8.41

Beverages

   1.15

Capital Markets

   6.09

Communications Equipment

   1.62

Diversified Telecommunication Services

   3.07

Electric Utilities

   1.47

Electrical Equipment

   4.73

Equity Real Estate Investment Trusts

   3.60

Food & Staples Retailing

   3.79

Health Care Providers & Services

   4.69

Hotels, Restaurants & Leisure

   1.38

Insurance

   1.78

Media

   4.97

Multiline Retail

   0.78

Multi-Utilities

   3.46

Oil, Gas & Consumable Fuels

   8.96

Pharmaceuticals

   14.12

Software

   1.27

Specialty Retail

   2.21

Tobacco

   5.00

Wireless Telecommunication Services

   1.77
  

 

 

 

TOTAL COMMON STOCKS

   86.18
  

 

 

 

PREFERRED STOCKS

  

Banks

   2.59

Capital Markets

   5.37

Technology Hardware, Storage & Peripherals

   1.94
  

 

 

 

TOTAL PREFERRED STOCKS

   9.90
  

 

 

 

SHORT-TERM INVESTMENTS

   6.85
  

 

 

 

TOTAL INVESTMENTS

   102.93

Liabilities in Excess of Other Assets

   (2.93)% 
  

 

 

 

TOTAL NET ASSETS

   100.00
  

 

 

 

The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC or were otherwise determined by the Adviser to be appropriate. This information is unaudited.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

46


Brandes Emerging Markets Value Fund

SCHEDULE OF INVESTMENTS — September 30, 2019

 

 

 

Shares     Value 
 COMMON STOCKS – 87.60% 
 Argentina – 2.19% 
 1,176,931  Adecoagro SA(a) $6,861,508 
 2,625,116  YPF SA Sponsored – Class D – ADR  24,282,323 
  

 

 

 
   31,143,831 
  

 

 

 
 Austria – 0.98% 
 421,414  Erste Group Bank AG  13,927,607 
  

 

 

 
 Brazil – 10.33% 
 330,118  AES Tiete Energia SA  964,544 
 5,180,100  Cielo SA  9,973,838 
 2,748,762  Embraer SA Sponsored – ADR  47,416,145 
 1,377,400  Hapvida Participacoes e Investimentos SA(c)  18,020,786 
 5,600,500  Kroton Educacional SA  15,110,075 
 9,098,615  Marfrig Global Foods SA(a)  24,066,181 
 3,594,793  YDUQS Part(a)  31,077,381 
  

 

 

 
   146,628,950 
  

 

 

 
 Chile – 1.18% 
 1,189,718  Empresa Nacional de Telecomunicaciones SA  10,427,755 
 1,509,388  Enel Chile SA Sponsored – ADR  6,354,523 
  

 

 

 
   16,782,278 
  

 

 

 
 China – 14.03% 
 29,314,000  China Construction Bank Corp. – Class H  22,336,073 
 6,243,900  China Mobile Ltd.  51,722,919 
 20,227,100  China Railway Signal & Communication Corp. Ltd.(c)  12,513,570 
 173,073  China Yuchai International Ltd.  2,241,295 
Shares     Value 
 34,409,000  Dongfeng Motor Group Co. Ltd. – Class H $32,692,423 
 21,333,500  Genertec Universal Medical Group Co. Ltd.(c)  14,315,952 
 27,200,000  PetroChina Co. Ltd.  13,952,298 
 11,814,800  Shanghai Pharmaceuticals Holding Co. Ltd. – Class H  21,398,473 
 2,982,000  TravelSky Technology Ltd.  6,192,293 
 6,967,200  Wynn Macau Ltd.  13,576,785 
 380,528  ZTO Express Cayman, Inc. – ADR  8,116,662 
  

 

 

 
   199,058,743 
  

 

 

 
 Colombia – 1.12% 
 2,127,094  Grupo Aval Acciones y Valores Grupo Sponsored – ADR  15,868,121 
  

 

 

 
 Czech Republic – 0.40% 
 626,829  O2 Czech Republic AS  5,668,717 
  

 

 

 
 Greece – 0.54% 
 552,285  Hellenic Telecommunications Organization SA  7,609,040 
  

 

 

 
 Hong Kong – 2.50% 
 28,461,920  First Pacific Co. Ltd.  10,895,954 
 10,597,500  Lifestyle International Holdings Ltd.  11,042,037 
 5,364,000  Luk Fook Holdings International Ltd.  13,475,914 
  

 

 

 
   35,413,905 
  

 

 

 
 India – 1.17% 
 5,904,971  Power Grid Corp of India Ltd.  16,585,359 
  

 

 

 
 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

47


Brandes Emerging Markets Value Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

Shares     Value 
 Indonesia – 4.15% 
 97,044,300  Bank Rakyat Indonesia Persero Tbk PT $28,178,260 
 126,877,915  PT XL Axiata Tbk(a)  30,744,773 
  

 

 

 
   58,923,033 
  

 

 

 
 Luxembourg – 0.01% 
 3,928  Ternium SA Sponsored – ADR(a)  75,378 
  

 

 

 
 Malaysia – 2.03% 
 21,040,900  Genting Berhad  28,857,999 
  

 

 

 
 Mexico – 10.87% 
 30,167,817  America Movil SAB de CV  22,411,077 
 10,054,422  Cemex SAB de CV Sponsored – ADR(a)  39,413,334 
 32,196,641  Fibra Uno Administracion SA de CV  47,167,574 
 17,287,809  Fideicomiso PLA Administradora Industrial S de RL de CV  26,579,108 
 14,203,330  Macquarie Mexico Real Estate Management SA de CV(c)  17,921,502 
 10,242,449  Urbi Desarrollos Urbanos SA de CV(a)(f)  778,538 
  

 

 

 
   154,271,133 
  

 

 

 
 Pakistan – 0.29% 
 7,646,760  Nishat Mills Ltd.  4,108,926 
  

 

 

 
 Panama – 1.83% 
 644,836  Banco Latinoamericano de Comercio Exterior SA – Class E  12,858,030 
Shares     Value 
 132,245  Copa Holdings SA – Class A $13,059,194 
  

 

 

 
   25,917,224 
  

 

 

 
 Russia – 5.57% 
 6,017,014  Mobile TeleSystems PJSC  24,585,748 
 8,476,466  Sberbank of Russia OJSC  29,761,407 
 2,684,906  Sistema JSFC Sponsored – GDR  10,369,118 
 410,848  X5 Retail Group NV – GDR  14,366,130 
  

 

 

 
   79,082,403 
  

 

 

 
 Singapore – 1.45% 
 1,963,128  Flex Ltd.(a)  20,544,135 
  

 

 

 
 South Africa – 1.49% 
 2,098,660  ABSA GROUP Ltd.  21,196,242 
  

 

 

 
 South Korea – 12.94% 
 133,964  Hyundai Mobis Co. Ltd.  28,191,791 
 752,977  KIA Motors Corp.(a)  28,708,859 
 431,744  KT&G Corp.  38,090,762 
 158,366  POSCO  30,019,529 
 157,189  S-1 Corp.  12,891,561 
 610,691  Samsung Electronics Co. Ltd.  25,004,166 
 592,275  Shinhan Financial Group Co. Ltd.(a)  20,695,863 
  

 

 

 
   183,602,531 
  

 

 

 
 Spain – 1.17% 
 11,548,879  Prosegur Cash SA(c)  16,595,130 
  

 

 

 
 Taiwan – 2.47% 
 3,216,000  Asustek Computer, Inc.  21,401,963 
 1,534,000  Taiwan Semiconductor Manufacturing Co Ltd.  13,624,274 
  

 

 

 
   35,026,237 
  

 

 

 
 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

48


Brandes Emerging Markets Value Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

Shares     Value 
 Thailand – 3.38% 
 1,984,500  Bangkok Bank Plc – NVDR $11,256,892 
 43,617,600  Jasmine Broadband Internet Infrastructure – Class F  15,687,219 
 5,464,600  Siam Commercial Bank PCL – Class F  21,090,658 
  

 

 

 
   48,034,769 
  

 

 

 
 Turkey – 2.76% 
 10,120,663  Akbank T.A.S.(a)  14,523,424 
 54,766,538  Emlak Konut Gayrimenkul Yatirim Ortakligi AG  13,462,094 
 6,223,640  Turkiye Garanti Bankasi Anonim Sirketis(a)  11,237,233 
  

 

 

 
   39,222,751 
  

 

 

 
 United Kingdom – 2.75% 
 22,007,865  Hyve Group Plc  23,081,862 
 10,376,419  Vivo Energy Plc(c)  15,947,823 
  

 

 

 
   39,029,685 
  

 

 

 
 

TOTAL COMMON STOCKS
(Cost $1,423,941,632)

 $1,243,174,127 
  

 

 

 
 PARTICIPATORY NOTES – 0.95% 
 China – 0.95% 
 7,936,516  China South Publishing & Media Group Co. Ltd.(a)(b)(c)(d) $13,443,815 
  

 

 

 
 

TOTAL PARTICIPATORY
NOTES
(Cost $15,164,834)

 $13,443,815 
  

 

 

 
Shares     Value 
 PREFERRED STOCKS – 8.70% 
 Brazil – 4.37% 
 1,166,900  Companhia Brasileira de Distribuicao $22,476,084 
 3,315,000  Petroleo Brasileiro SA  21,948,676 
 498,300  Telefonica Brasil SA  6,584,115 
 846,683  Telefonica Brasil SA Sponsored – ADR  11,150,815 
  

 

 

 
   62,159,690 
  

 

 

 
 Colombia – 0.53% 
 20,018,115  Grupo Aval Acciones y Valores SA  7,506,793 
  

 

 

 
 Russia – 1.94% 
 32,081,832  Surgutneftegas PJSC  18,530,338 
 1,570,389  Surgutneftegas PJSC Sponsored – ADR  8,919,810 
  

 

 

 
   27,450,148 
  

 

 

 
 South Korea – 1.86% 
 413,848  Hyundai Motor Co. Ltd.  26,414,322 
  

 

 

 
 

TOTAL PREFERRED
STOCKS
(Cost $125,347,938)

 $123,530,953 
  

 

 

 
 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

49


Brandes Emerging Markets Value Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

   Shares  Value 
SHORT–TERM INVESTMENTS – 3.02%  
Money Market Funds – 3.02%  

BlackRock Liquidity Funds T–Fund – Institutional Class, 1.834%(e)

  42,839,683  $42,839,683 
  

 

 

 

TOTAL SHORT–TERM INVESTMENTS
(Cost $42,839,683)

  $42,839,683 
  

 

 

 

Total Investments (Cost $1,607,294,087) – 100.27%

  $1,422,988,578 

Liabilities in Excess of Other Assets – (0.27)%

   (3,793,370
  

 

 

 

TOTAL NET ASSETS – 100.00%

  $1,419,195,208 
  

 

 

 

 

Percentages are stated as a percent of net assets.

ADR American Depositary Receipt

GDR Global Depositary Receipt

NVDR Non-Voting Depositary Receipt

(a)

Non-income producing security.

(b)

The price for this security was derived from an estimate of fair market value using methods approved by the Fund’s Board of Trustees. This security represents $13,443,815 or 0.95% of the Fund’s net assets and is classified as a Level 2 security. See Note 2 in the Notes to Financial Statements.

(c)

Acquired in a transaction exempt from registration under Rule 144A or Section 4(a)(2) of the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities was $108,758,578, which represented 7.66% of the net assets of the Fund.

(d)

Represents the underlying security of a participatory note with HSBC Bank Plc. China South Publishing & Media Group Co. Ltd. has a maturity date of November 23, 2021. See Note 2 in the Notes to Schedule of Investments.

(e)

The rate shown is the annualized seven day yield as of September 30, 2019.

(f)

Affiliated issuer. See Note 8 in the Notes to the Financial Statements.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

50


Brandes Emerging Markets Value Fund

SCHEDULE OF INVESTMENTS BY INDUSTRY — September 30, 2019

 

 

 

COMMON STOCKS

  

Aerospace & Defense

   3.34

Air Freight & Logistics

   0.57

Airlines

   0.92

Auto Components

   1.99

Automobiles

   4.33

Banks

   14.80

Commercial Services & Supplies

   2.08

Construction Materials

   2.78

Diversified Consumer Services

   3.25

Diversified Financial Services

   1.67

Diversified Telecommunication Services

   0.94

Electric Utilities

   1.62

Electronic Equipment, Instruments & Components

   2.33

Equity Real Estate Investment Trusts

   8.51

Food & Staples Retailing

   1.01

Food Products

   2.18

Health Care Providers & Services

   3.79

Hotels, Restaurants & Leisure

   2.99

Household Durables

   0.05

Independent Power & Renewable Electricity Producers

   0.07

IT Services

   1.14

Machinery

   0.16

Media

   1.63

Metals & Mining

   2.12

Multiline Retail

   0.78

Oil, Gas & Consumable Fuels

   2.69

Semiconductors & Semiconductor Equipment

   0.96

Specialty Retail

   2.07

Technology Hardware, Storage & Peripherals

   3.27

Textiles, Apparel & Luxury Goods

   0.29

Tobacco

   2.68

Wireless Telecommunication Services

   10.59
  

 

 

 

TOTAL COMMON STOCKS

   87.60
  

 

 

 

PARTICIPATORY NOTES

  

Media

   0.95
  

 

 

 

TOTAL PARTICIPATORY NOTES

   0.95
  

 

 

 

PREFERRED STOCKS

  

Automobiles

   1.86

Banks

   0.53

Diversified Telecommunication Services

   1.25

Food & Staples Retailing

   1.58

Oil, Gas & Consumable Fuels

   3.48
  

 

 

 

TOTAL PREFERRED STOCKS

   8.70
  

 

 

 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

51


Brandes Emerging Markets Value Fund

SCHEDULE OF INVESTMENTS BY INDUSTRY — September 30, 2019 (continued)

 

 

 

SHORT-TERM INVESTMENTS

   3.02
  

 

 

 

TOTAL INVESTMENTS

   100.27

Liabilities in Excess of Other Assets

   (0.27)% 
  

 

 

 

TOTAL NET ASSETS

   100.00
  

 

 

 

The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC or were otherwise determined by the Adviser to be appropriate. This information is unaudited.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

52


Brandes International Small Cap Equity Fund

SCHEDULE OF INVESTMENTS — September 30, 2019

 

 

 

Shares     Value 
 COMMON STOCKS – 95.29% 
 Argentina – 0.52% 
 429,593  Adecoagro SA(a) $2,504,527 
  

 

 

 
 Austria – 0.91% 
 237,124  Addiko Bank AG(a)  4,419,567 
  

 

 

 
 Brazil – 5.13% 
 4,982,147  Embraer SA  21,559,586 
 2,026,400  Mills Estruturas e Servicos de Engenharia SA(a)  3,360,304 
  

 

 

 
   24,919,890 
  

 

 

 
 Canada – 5.29% 
 1,034,245  Celestica, Inc.(a)  7,415,537 
 855,918  Dorel Industries, Inc. – Class B(a)  5,872,585 
 1,162,476  Sierra Wireless, Inc.(a)  12,415,772 
  

 

 

 
   25,703,894 
  

 

 

 
 China – 2.02% 
 15,644,900  Boyaa Interactive International Ltd.  2,349,579 
 283,869  China Yuchai International Ltd.  3,676,104 
 14,229,500  Weiqiao Textile Co. Ltd. – Class H  3,762,743 
  

 

 

 
   9,788,426 
  

 

 

 
 France – 2.32% 
 86,398  Savencia SA  6,064,538 
 77,502  Societe BIC SA  5,203,574 
  

 

 

 
   11,268,112 
  

 

 

 
 Germany – 1.74% 
 111,228  Draegerwerk AG & Co. KGaA  3,921,900 
 203,294  Rhoen-Klinikum AG  4,553,492 
  

 

 

 
   8,475,392 
  

 

 

 
 Greece – 0.60% 
 328,625  GR Sarantis SA  2,901,307 
  

 

 

 
 Hong Kong – 4.45% 
 7,832,050  APT Satellite Holdings Ltd.  3,167,715 
 3,581,000  Dickson Concepts International Ltd.  1,971,315 
 86,140,000  Emperor Watch & Jewellery Ltd.  1,869,215 
Shares     Value 
 22,694,000  First Pacific Co. Ltd. $8,687,847 
 13,184,000  PAX Global Technology Ltd.  5,931,898 
  

 

 

 
   21,627,990 
  

 

 

 
 Hungary – 2.22% 
 7,532,169  Magyar Telekom Telecommunications Plc  10,785,829 
  

 

 

 
 Ireland – 3.56% 
 1,235,959  Avadel Pharmaceuticals Plc Sponsored – ADR(a)  5,141,589 
 2,682,781  C&C Group Plc  12,135,047 
  

 

 

 
   17,276,636 
  

 

 

 
 Italy – 1.78% 
 240,192  Buzzi Unicem SpA  3,476,542 
 5,008,687  Safilo Group SpA(a)  5,153,520 
  

 

 

 
   8,630,062 
  

 

 

 
 Japan – 21.95% 
 58,300  Bank of Nagoya Ltd.  1,721,695 
 663,400  Concordia Financial Group Ltd.  2,556,592 
 615,200  Fuji Media Holdings, Inc.  7,948,691 
 709,900  Funai Electric Co. Ltd.  3,931,586 
 204,000  Futaba Corp.  2,505,691 
 1,992,500  Hachijuni Bank Ltd.  8,162,960 
 2,382,200  Hyakugo Bank Ltd.  7,643,851 
 294,200  Kato Sangyo Co. Ltd.  9,182,424 
 357,300  Kissei Pharmaceutical Co. Ltd.  8,641,000 
 1,069,900  Komori Corp.  11,329,338 
 1,927,300  Kyushu Financial Group, Inc.  7,886,465 
 210,000  Mitsubishi Shokuhin Co. Ltd.  5,279,951 
 154,700  Nippon Seiki Co. Ltd.  2,375,791 
 88,200  Oita Bank Ltd.  2,377,515 
 395,200  Tachi-S Co. Ltd.  4,815,810 
 97,600  Torii Pharmaceutical Co. Ltd.  2,606,404 
 179,200  Toyo Suisan Kaisha Ltd.  7,196,083 
 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

53


Brandes International Small Cap Equity Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

Shares     Value 
 457,200  TSI Holdings Co. Ltd. $2,544,093 
 132,900  Tsutsumi Jewelry Co. Ltd.  2,565,239 
 283,200  Yodogawa Steel Works Ltd.  5,311,920 
  

 

 

 
   106,583,099 
  

 

 

 
 Mexico – 7.35% 
 637,250  Cemex SAB de CV Sponsored – ADR(a)  2,498,020 
 27,919,538  Consorcio ARA SAB de CV(a)  5,843,098 
 279,501,983  Desarrolladora Homex SAB de CV(a)(c)  1,118,914 
 11,986,453  Fibra Uno Administracion SA de CV  17,559,965 
 5,896,622  Macquarie Mexico Real Estate Management SA de CV(b)  7,440,250 
 16,033,402  Urbi Desarrollos Urbanos SA de CV(a)(c)  1,218,714 
  

 

 

 
   35,678,961 
  

 

 

 
 Panama – 0.57% 
 139,056  Banco Latinoamericano de Comercio Exterior SA – Class E  2,772,777 
  

 

 

 
 Philippines – 1.01% 
 3,173,212  First Philippine Holdings Corp.  4,916,244 
  

 

 

 
 Russia – 0.96% 
 23,851,962  Sistema PJSFC  4,663,369 
  

 

 

 
 Slovenia – 1.74% 
 712,555  Nova Ljubljanska Banka – GDR(b)  8,434,442 
  

 

 

 
 South Korea – 7.32% 
 93,464  Binggrae Co. Ltd.  4,555,408 
 729,184  Korean Reinsurance Co.  4,881,893 
 52,050  Lotte Chilsung Beverage Co. Ltd.  6,019,337 
Shares     Value 
 45,558  Lotte Confectionery Co. Ltd. $5,599,628 
 223,640  Lotte Corp.(a)  6,771,113 
 6,052  Namyang Dairy Products Co. Ltd.  2,486,777 
 74,175  Samchully Co. Ltd.  5,234,500 
  

 

 

 
   35,548,656 
  

 

 

 
 Spain – 2.71% 
 1,952,922  Atresmedia Corp de Medios de Comunicacion SA  7,522,863 
 671,850  Lar Espana Real Estate Socimi SA  5,645,922 
  

 

 

 
   13,168,785 
  

 

 

 
 United Kingdom – 21.14% 
 1,928,535  Balfour Beatty Plc  5,259,226 
 3,821,170  Chemring Group Plc  9,246,244 
 56,238,231  Countrywide Plc(a)  2,748,607 
 3,497,383  De La Rue Plc  9,610,912 
 20,071,416  Debenhams Plc(a)(d)   
 3,485,439  G4S Plc  8,117,330 
 8,840,985  Hyve Group Plc  9,272,430 
 6,419,205  J Sainsbury Plc  17,321,482 
 1,918,582  LSL Property Services Plc  5,071,807 
 6,271,043  Mitie Group Plc  11,288,201 
 8,873,233  Premier Foods Plc(a)  3,534,848 
 2,447,969  Telit Communications Plc(a)  4,960,289 
 6,589,724  Wm Morrison Supermarkets Plc  16,225,309 
  

 

 

 
   102,656,685 
  

 

 

 
 

TOTAL COMMON STOCKS
(Cost $572,669,302)

 $462,724,650 
  

 

 

 
 PREFERRED STOCKS – 1.86% 
 Germany – 1.86% 
 202,891  Draegerwerk AG & Co. KGaA $9,004,896 
  

 

 

 
 

TOTAL PREFERRED
STOCKS
(Cost $13,018,864)

 $9,004,896 
  

 

 

 
 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

54


Brandes International Small Cap Equity Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

   Shares  Value 
SHORT-TERM INVESTMENTS – 6.14%  
Money Market Funds – 6.14%  

BlackRock Liquidity FundsT-Fund – Institutional Class, 1.834%(e)

  29,835,284  $29,835,284 
  

 

 

 

TOTAL SHORT-TERM INVESTMENTS
(Cost $29,835,284)

  $29,835,284 
  

 

 

 

Total Investments (Cost $615,523,450) – 103.29%

  $501,564,830 

Liabilities in Excess of Other Assets – (3.29)%

   (15,967,928
  

 

 

 

TOTAL NET ASSETS – 100.00%

  $485,596,902 
  

 

 

 

 

Percentages are stated as a percent of net assets.

ADR American Depository Receipt

GDR Global Depositary Receipt

(a)

Non-income producing security.

(b)

Acquired in a transaction exempt from registration under Rule 144A or Section 4(a)(2) of the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities was $15,874,692, which represented 3.27% of the net assets of the Fund.

(c)

Affiliated issuer. See Note 8 in the Notes to the Financial Statements.

(d)

The price for this security was derived from an estimate of fair market value using methods approved by the Fund’s Board of Trustees. This security represents $0 or 0.00% of the Fund’s net assets and is classified as a Level 2 security. See Note 2 in the Notes to Financial Statements.

(e)

The rate shown is the annualized seven day yield as of September 30, 2019.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

55


Brandes International Small Cap Equity Fund

SCHEDULE OF INVESTMENTS BY INDUSTRY — September 30, 2019

 

 

 

COMMON STOCKS

  

Aerospace & Defense

   6.34

Auto Components

   1.48

Banks

   8.90

Beverages

   3.74

Commercial Services & Supplies

   7.05

Communications Equipment

   3.58

Construction & Engineering

   1.08

Construction Materials

   1.23

Diversified Financial Services

   2.36

Diversified Telecommunication Services

   2.87

Electric Utilities

   1.01

Electrical Equipment

   0.52

Electronic Equipment, Instruments & Components

   2.75

Entertainment

   0.48

Equity Real Estate Investment Trusts

   6.31

Food & Staples Retailing

   9.88

Food Products

   6.58

Gas Utilities

   1.08

Health Care Equipment & Supplies

   0.81

Health Care Providers & Services

   0.94

Household Durables

   3.70

Industrial Conglomerate

   1.39

Insurance

   1.01

Machinery

   3.09

Media

   5.10

Metals & Mining

   1.09

Multiline Retail

   

Personal Products

   0.60

Pharmaceuticals

   3.38

Real Estate Management & Development

   1.61

Specialty Retail

   0.79

Textiles, Apparel & Luxury Goods

   2.89

Trading Companies & Distributors

   0.69

Wireless Telecommunication Services

   0.96
  

 

 

 

TOTAL COMMON STOCKS

   95.29
  

 

 

 

PREFERRED STOCKS

  

Health Care Equipment & Supplies

   1.86
  

 

 

 

TOTAL PREFERRED STOCKS

   1.86
  

 

 

 

SHORT-TERM INVESTMENTS

   6.14
  

 

 

 

TOTAL INVESTMENTS

   103.29

Liabilities in Excess of Other Assets

   (3.29)% 
  

 

 

 

TOTAL NET ASSETS

   100.00
  

 

 

 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

56


Brandes International Small Cap Equity Fund

SCHEDULE OF INVESTMENTS BY INDUSTRY — September 30, 2019 (continued)

 

 

 

The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC or were otherwise determined by the Adviser to be appropriate. This information is unaudited.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

57


Brandes Small Cap Value Fund

SCHEDULE OF INVESTMENTS — September 30, 2019

 

 

 

Shares     Value 
 COMMON STOCKS – 87.63% 
 Aerospace & Defense – 3.88% 
 482  Embraer SA Sponsored – ADR $8,315 
 116  National Presto Industries, Inc.  10,334 
  

 

 

 
   18,649 
  

 

 

 
 Auto Components – 1.09% 
 201  Cooper Tire & Rubber Co.  5,250 
  

 

 

 
 Banks – 4.85% 
 385  Eagle Bancorp Montana, Inc.  6,737 
 206  National Bankshares, Inc.  8,250 
 210  Northrim BanCorp, Inc.  8,331 
  

 

 

 
   23,318 
  

 

 

 
 Biotechnology – 8.82% 
 255  AMAG Pharmaceuticals, Inc.(a)  2,945 
 171  Eagle Pharmaceuticals, Inc.(a)  9,673 
 7,076  PDL BioPharma, Inc.  15,284 
 182  United Therapeutics Corp.(a)  14,515 
  

 

 

 
   42,417 
  

 

 

 
 Chemicals – 1.34% 
 94  Sensient Technologies Corp.  6,453 
  

 

 

 
 Communications Equipment – 8.12% 
 656  Digi International, Inc.(a)  8,935 
 648  NETGEAR, Inc.(a)  20,878 
 863  Sierra Wireless, Inc.(a)  9,234 
  

 

 

 
   39,047 
  

 

 

 
 Construction & Engineering – 1.28% 
 1,370  Orion Group Holdings, Inc.(a)  6,165 
  

 

 

 
 
Electronic Equipment, Instruments &
Components – 3.05%
 
 
 341  Arlo Technologies, Inc.(a)  1,163 
 304  Avnet, Inc.(a)  13,523 
  

 

 

 
   14,686 
  

 

 

 
 
Equity Real Estate Investment
Trusts – 0.79%
 
 
 155  Alexander & Baldwin, Inc.  3,799 
  

 

 

 
Shares     Value 
 Food Products – 3.59% 
 108  Cal-Maine Foods, Inc. $4,315 
 415  Seneca Foods Corp. – Class A(a)  12,940 
  

 

 

 
   17,255 
  

 

 

 
 Health Care Equipment & Supplies – 0.76% 
 489  Invacare Corp.  3,668 
  

 

 

 
 Health Care Providers & Services – 3.48% 
 299  Patterson Companies, Inc.(a)  5,328 
 853  Triple-S Management Corp. – Class B(a)  11,430 
  

 

 

 
   16,758 
  

 

 

 
 Hotels, Restaurants & Leisure – 1.11% 
 119  International Speedway Corp. – Class A  5,356 
  

 

 

 
 Household Durables – 7.16% 
 812  CSS Industries, Inc.  3,224 
 707  Dorel Industries, Inc. – Class B(a)  4,851 
 134  M.D.C. Holdings, Inc.  5,775 
 511  Taylor Morrison Home Corp. – Class A(a)  13,255 
 179  Toll Brothers, Inc.(a)  7,348 
  

 

 

 
   34,453 
  

 

 

 
 Insurance – 5.64% 
 64  American National Insurance Co.  7,919 
 51  National Western Life Group, Inc.  13,687 
 234  Old Republic International Corp.  5,515 
  

 

 

 
   27,121 
  

 

 

 
 Machinery – 6.70% 
 2,186  Briggs & Stratton Corp.  13,247 
 239  Hurco Companies, Inc.(a)  7,689 
 376  The Greenbrier Companies, Inc.  11,325 
  

 

 

 
   32,261 
  

 

 

 
 Media – 1.76% 
 224  Scholastic Corp.  8,458 
  

 

 

 
 Multi-Utilities – 1.25% 
 124  Avista Corp.  6,007 
  

 

 

 
 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

58


Brandes Small Cap Value Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

Shares     Value 
 Oil, Gas & Consumable Fuels – 1.45% 
 1,362  Chesapeake Energy Corp. $1,921 
 127  World Fuel Services Corp.  5,072 
  

 

 

 
   6,993 
  

 

 

 
 Personal Products – 4.61% 
 683  Edgewell Personal Care Co.(a)  22,191 
  

 

 

 
 Pharmaceuticals – 4.35% 
 2,656  Avadel Pharmaceuticals Plc Sponsored – ADR(a)  11,049 
 463  Phibro Animal Health Corp.  9,876 
  

 

 

 
   20,925 
  

 

 

 
 Professional Services – 2.01% 
 568  Resources Connection, Inc.(a)  9,650 
  

 

 

 
 
Real Estate Management &
Development – 3.26%
 
 
 917  The St. Joe Co.(a)  15,708 
  

 

 

 
 Software – 2.96% 
 96  MicroStrategy, Inc. – Class A(a)  14,244 
  

 

 

 
Shares     Value 
 Specialty Retail – 0.69% 
 128  Rent-A-Center, Inc.(a) $3,301 
  

 

 

 
 Textiles, Apparel & Luxury Goods – 1.10% 
 213  Movado Group, Inc.  5,295 
  

 

 

 
 Thrifts & Mortgage Finance – 1.35% 
 227  Territorial Bancorp, Inc.  6,488 
  

 

 

 
 Trading Companies & Distributors – 1.18% 
 1,205  Houston Wire & Cable Co.  5,688 
  

 

 

 
 

TOTAL COMMON STOCKS
(Cost $426,450)

 $421,604 
  

 

 

 
 PREFERRED STOCKS – 1.27% 
 Oil, Gas & Consumable Fuels – 1.27% 
 16  Chesapeake Energy Corp., 5.750% $6,112 
  

 

 

 
 

TOTAL PREFERRED STOCKS
(Cost $8,800)

 $6,112 
  

 

 

 
 
   Principal
Amount
  Value 
CORPORATE BONDS – 6.32%  
Electric Utilities – 2.52%  

PNM Resources, Inc.
3.250%, 3/9/2021

 $12,000  $12,113 
  

 

 

 
Household Durables – 2.10%  

MDC Holdings, Inc.
5.625%, 2/1/2020

  10,000   10,088 
  

 

 

 
Machinery – 1.70%  

Kennametal, Inc.
3.875%, 2/15/2022

  8,000   8,207 
  

 

 

 

TOTAL CORPORATE BONDS (Cost $30,271)

  $30,408 
  

 

 

 
   Shares  Value 
SHORT-TERM INVESTMENTS – 11.91%  
Money Market Funds – 11.91%  

BlackRock Liquidity FundsT-Fund – Institutional Class, 1.834%(b)

  57,290  $57,290 
  

 

 

 

TOTAL SHORT-TERM INVESTMENTS(Cost $57,290)

  $57,290 
  

 

 

 

Total Investments (Cost $522,811) – 107.13%

  $515,414 

Liabilities in Excess of Other Assets – (7.13)%

   (34,285
  

 

 

 

TOTAL NET ASSETS – 100.00%

  $481,129 
  

 

 

 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

59


Brandes Small Cap Value Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

 

Percentages are stated as a percent of net assets.

ADR American Depository Receipt

(a)Non-income producing security.

(b) The rate shown is the annualized seven day yield as of September 30, 2019.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

60


Brandes Small Cap Value Fund

SCHEDULE OF INVESTMENTS BY COUNTRY — September 30, 2019

 

 

 

COMMON STOCKS

  

Brazil

   1.73

Canada

   2.93

Ireland

   2.30

United States

   80.67
  

 

 

 

TOTAL COMMON STOCKS

   87.63
  

 

 

 

PREFERRED STOCKS

  

United States

   1.27
  

 

 

 

TOTAL PREFERRED STOCKS

   1.27
  

 

 

 

CORPORATE BONDS

  

United States

   6.32
  

 

 

 

TOTAL CORPORATE BONDS

   6.32
  

 

 

 

SHORT-TERM INVESTMENTS

   11.91
  

 

 

 

TOTAL INVESTMENTS

   107.13

Liabilities in Excess of Other Assets

   (7.13)% 
  

 

 

 

TOTAL NET ASSETS

   100.00
  

 

 

 

The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC or were otherwise determined by the Adviser to be appropriate. This information is unaudited.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

61


Brandes Core Plus Fixed Income Fund

SCHEDULE OF INVESTMENTS — September 30, 2019

 

 

 

   Shares  Value 
COMMON STOCKS – 0.00%  
Household Durables – 0.00%  

Urbi Desarrollos Urbanos SA de CV(a)

  31,277  $2,377 
  

 

 

 

TOTAL COMMON STOCKS
(Cost $292,050)

  $2,377 
  

 

 

 
   Principal
Amount
  Value 
FEDERAL AND FEDERALLY SPONSORED CREDITS – 13.85%

 

 
Federal Home Loan Mortgage Corporation – 4.82%  

Pool G1-8578, 3.000%, 12/1/2030

 $1,378,954  $1,416,920 

Pool G0-6018, 6.500%, 4/1/2039

  22,301   25,607 

Pool A9-3505, 4.500%, 8/1/2040

  107,359   116,369 

Pool SD-8001, 3.500%, 7/1/2049

  1,249,937   1,282,389 

Pool SD-8003, 4.000%, 7/1/2049

  1,284,118   1,333,232 
  

 

 

 
   4,174,517 
  

 

 

 
Federal National Mortgage Association – 9.03%  

Pool CA1624, 3.000%, 4/1/2033

  1,036,957   1,064,280 

Pool 934124, 5.500%, 7/1/2038

  40,441   45,524 

Pool MA0918, 4.000%, 12/1/2041

  250,341   267,429 

Pool AS6201, 3.500%, 11/1/2045

  989,996   1,031,289 

Pool AL9865, 3.000%, 2/1/2047

  1,756,710   1,799,275 

Pool BJ2553, 3.500%, 12/1/2047

  673,736   696,740 

Pool BN6683, 3.500%, 6/1/2049

  1,855,335   1,908,466 

Pool MA3687, 4.000%, 6/1/2049

  960,565   997,212 
  

 

 

 
   7,810,215 
  

 

 

 

TOTAL FEDERAL AND FEDERALLY SPONSORED CREDITS
(Cost $11,748,661)

  $11,984,732 
  

 

 

 
OTHER MORTGAGE RELATED SECURITIES – 0.00%  
Collateralized Mortgage Obligations – 0.00%  

Wells Fargo Mortgage Backed Securities 2006-AR14 Trust
Series 2006-AR14, 4.580%, 10/25/2036(c)

 $975  $953 
  

 

 

 

TOTAL OTHER MORTGAGE RELATED SECURITIES
(Cost $959)

  $953 
  

 

 

 
US GOVERNMENTS – 49.00%  
Sovereign – 49.00%  

United States Treasury Note

  

2.000%, 11/15/2021

 $211,000  $212,591 

2.000%, 2/15/2023

  3,140,000   3,182,684 

2.375%, 8/15/2024

  10,405,000   10,792,749 

2.250%, 2/15/2027

  16,850,000   17,579,947 

2.375%, 5/15/2029

  3,500,000   3,716,836 

4.750%, 2/15/2037

  4,835,000   6,928,970 
  

 

 

 

TOTAL US GOVERNMENTS
(Cost $40,140,796)

  $42,413,777 
  

 

 

 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

62


Brandes Core Plus Fixed Income Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

   Principal
Amount
  Value 
ASSET BACKED SECURITIES – 2.02%  
Equipment – 0.03%  

Continental Airlines 2007-1 Class A Pass Through Trust
Series 2007-1, 5.983%, 10/19/2023

 $26,660  $28,134 
  

 

 

 
Student Loan – 1.99%  

SLM Private Credit Student Loan Trust 2004-B
Series 2004-B, 2.549% (3M LIBOR + 0.430%), 9/15/2033(d)

  300,000   289,712 

SLM Private Credit Student Loan Trust 2005-A
Series 2005-A, 2.429% (3M LIBOR + 0.310%), 12/15/2038(d)

  400,000   390,146 

SLM Private Credit Student Loan Trust 2006-A
Series 2006-A, 2.409% (3M LIBOR + 0.290%), 6/15/2039(d)

  752,412   736,277 

SLM Private Credit Student Loan Trust 2007-A
Series 2007-A, 2.359% (3M LIBOR + 0.240%), 12/15/2041(d)

  308,573   300,679 
  

 

 

 
   1,716,814 
  

 

 

 

TOTAL ASSET BACKED SECURITIES
(Cost $1,634,327)

  $1,744,948 
  

 

 

 
CORPORATE BONDS – 32.46%  
Automobiles – 2.07%  

Ford Motor Credit Co. LLC
8.125%, 1/15/2020

  780,000  $792,897 

General Motors Financial Co., Inc.
2.650%, 4/13/2020

  1,000,000   1,001,322 
  

 

 

 
   1,794,219 
  

 

 

 
Banks – 7.00%  

Citibank NA
2.100%, 6/12/2020

  1,650,000   1,650,524 

Fifth Third Bancorp
8.250%, 3/1/2038

  175,000   269,239 

Goldman Sachs Group, Inc.
3.000%, 4/26/2022

  780,000   788,479 

JPMorgan Chase & Co.
5.736% (3M LIBOR + 3.470%), Perpetual(d)

  1,639,000   1,646,682 

USB Capital IX
3.500% (3M LIBOR + 1.020%, minimum of 3.5000%), Perpetual(d)

  1,265,000   1,078,413 

Wells Fargo & Co.
5.889% (3M LIBOR + 3.770%), Perpetual(d)

  618,000   625,725 
  

 

 

 
   6,059,062 
  

 

 

 
Commercial Services & Supplies – 2.61%  

ADT Corp.
3.500%, 7/15/2022

  1,830,000   1,836,863 

Iron Mountain, Inc.
4.875%, 9/15/2027(b)

  410,000   419,299 
  

 

 

 
   2,256,162 
  

 

 

 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

63


Brandes Core Plus Fixed Income Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

   Principal
Amount
  Value 
Consumer Products – 1.71%  

Avon International Operations, Inc.
7.875%, 8/15/2022(b)

 $925,000  $962,897 

Wyndham Destinations, Inc.
3.900%, 3/1/2023

  510,000   517,650 
  

 

 

 
   1,480,547 
  

 

 

 
Electric Utilities – 0.28%  

Commonwealth Edison Co.
5.900%, 3/15/2036

  175,000   238,251 
  

 

 

 
Food, Beverage & Tobacco – 1.76%  

Mead Johnson Nutrition Co.
4.900%, 11/1/2019

  775,000   776,642 

Pilgrim’s Pride Corp.
5.750%, 3/15/2025(b)

  725,000   750,375 
  

 

 

 
   1,527,017 
  

 

 

 
Homebuilders – 2.16%  

PulteGroup, Inc.
5.500%, 3/1/2026

  980,000   1,070,650 

Toll Brothers Finance Corp.
4.875%, 11/15/2025

  745,000   797,150 
  

 

 

 
   1,867,800 
  

 

 

 
Insurance – 0.97%  

American International Group, Inc.
6.400%, 12/15/2020

  800,000   840,662 
  

 

 

 
Media – 0.50%  

Netflix, Inc.
5.375%, 2/1/2021

  420,000   432,600 
  

 

 

 
Metals & Mining – 0.14%  

Cloud Peak Energy
12.000%, 11/1/2021(a)(e)

  480,000   120,000 
  

 

 

 
Oil, Gas & Consumable Fuels – 8.15%  

BP Capital Markets Plc
3.506%, 3/17/2025

  810,000   859,537 

Chesapeake Energy Corp.
8.000%, 1/15/2025

  1,245,000   899,513 

Chevron Corp.
2.100%, 5/16/2021

  1,150,000   1,154,440 

Exxon Mobil Corp.
2.397%, 3/6/2022

  945,000   959,407 

Kinder Morgan, Inc.
4.300%, 6/1/2025

  1,054,000   1,139,503 

Occidental Petroleum Corp.
3.500%, 6/15/2025

  555,000   570,602 

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

64


Brandes Core Plus Fixed Income Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

   Principal
Amount
  Value 

Range Resources Corp.
5.000%, 3/15/2023

 $1,680,000  $1,470,000 
  

 

 

 
   7,053,002 
  

 

 

 
Technology – 2.35%  

Microsoft Corp.
2.400%, 2/6/2022

  1,000,000   1,013,962 

VMware, Inc.
3.900%, 8/21/2027

  995,000   1,023,334 
  

 

 

 
   2,037,296 
  

 

 

 
Telecommunications – 2.76%  

AT&T, Inc.
3.000%, 6/30/2022

  1,630,000   1,663,782 

Frontier Communications Corp.
6.250%, 9/15/2021

  1,320,000   587,400 

Telefonica Emisiones SA
5.462%, 2/16/2021

  135,000   140,924 
  

 

 

 
   2,392,106 
  

 

 

 

TOTAL CORPORATE BONDS
(Cost $28,424,061)

  $28,098,724 
  

 

 

 
   Shares  Value 
SHORT-TERM INVESTMENTS – 2.43%  
Money Market Funds – 2.43%  

BlackRock Liquidity Funds T-Fund – Institutional Class, 1.834%(f)

  2,098,876  $2,098,876 
  

 

 

 

TOTAL SHORT-TERM INVESTMENTS
(Cost $2,098,876)

  $2,098,876 
  

 

 

 

Total Investments (Cost $84,339,730) – 99.76%

  $86,344,387 

Liabilities in Excess of Other Assets – 0.24%

   206,639 
  

 

 

 

TOTAL NET ASSETS – 100.00%

  $86,551,026 
  

 

 

 

 

Percentages are stated as a percent of net assets.

LIBOR London Inter-bank Offered Rate

(a)

Non-income producing security.

(b)

Acquired in a transaction exempt from registration under Rule 144A or Section 4(a)(2) of the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities was $2,132,571, which represented 2.46% of the net assets of the Fund.

(c)

Variable rate security. The coupon is based on an underlying pool of loans.

(d)

Variable rate security. The coupon is based on a reference index and spread index.

(e)

Issuer filed for bankruptcy and is in default of interest payments.

(f)

The rate shown is the annualized seven day yield as of September 30, 2019.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

65


Brandes Core Plus Fixed Income Fund

SCHEDULE OF INVESTMENTS — September 30, 2019 (continued)

 

 

 

The industry classifications represented in the Schedule of Investments are in accordance with Global Industry Classification Standards (GICS®), which was developed by and/or is the exclusive property of MSCI, Inc. and Standard & Poor Financial Services LLC or were otherwise determined by the Adviser to be appropriate. This information is unaudited.

 

The accompanying notes to financial statements are an integral part of these Schedule of Investments.

 

66


(This Page Intentionally Left Blank.)

 

67


Brandes Investment Trust

STATEMENTS OF ASSETS AND LIABILITIES — September 30, 2019

 

 

 

   Brandes
International
Equity Fund
         
Brandes
Global
Equity Fund
 

ASSETS

      

Investment in securities, at value(1)

      

Unaffiliated issuers

  $702,143,343     $36,230,060 

Affiliated issuers

          

Foreign Currency(1)

   105,240      11,836 

Receivables:

      

Securities sold

          

Fund shares sold

   1,788,867       

Dividends and interest

   3,208,217      86,155 

Foreign currency spot trade

          

Tax reclaims

   947,410      44,154 

Securities lending

   27,804       

Due from Advisor

          

Prepaid expenses and other assets

   55,361      15,274 
  

 

 

     

 

 

 

Total Assets

   708,276,242      36,387,479 
  

 

 

     

 

 

 

LIABILITIES

      

Payables:

      

Fund shares redeemed

   3,468,182      170,104 

Due to Advisor

   365,675      8,280 

12b-1 Fee

   14,806      1,054 

Trustee Fees

   22,985      1,270 

Custodian Fee Payable

   12,941      921 

Dividends payable

   359,984      2,478 

Foreign tax withholding

   266,330      3,009 

Foreign currency spot trade payable

   346      39 

Accrued expenses

   400,517      128,515 
  

 

 

     

 

 

 

Total Liabilities

   4,911,766      315,670 
  

 

 

     

 

 

 

NET ASSETS

  $703,364,476     $36,071,809 
  

 

 

     

 

 

 

COMPONENTS OF NET ASSETS

      

Paid in Capital

  $834,714,110     $33,575,673 

Total distributable earnings (loss)

   (131,349,634     2,496,136 
  

 

 

     

 

 

 

Total Net Assets

  $703,364,476     $36,071,809 
  

 

 

     

 

 

 

Net asset value, offering price and redemption proceeds per share

      

Class A Shares

      

Net Assets

  $32,019,257     $1,487,607 

Shares outstanding (unlimited shares authorized without par value)

   1,999,135      68,402 

Offering and redemption price

  $16.02     $21.75 
  

 

 

     

 

 

 

Maximum offering price per share*

  $16.99     $23.08 
  

 

 

     

 

 

 

Class C Shares

      

Net Assets

  $13,059,248     $1,193,477 

Shares outstanding (unlimited shares authorized without par value)

   828,768      55,253 

Offering and redemption price

  $15.76     $21.60 
  

 

 

     

 

 

 

Class I Shares

      

Net Assets

  $622,414,368     $33,390,725 

Shares outstanding (unlimited shares authorized without par value)

   38,722,403      1,523,832 

Offering and redemption price

  $16.07     $21.91 
  

 

 

     

 

 

 

Class R6 Shares

      

Net Assets

  $35,871,603      N/A 

Shares outstanding (unlimited shares authorized without par value)

   2,221,551      N/A 

Offering and redemption price

  $16.15      N/A 
  

 

 

     

 

 

 

(1)Costof:

      

Investments in securities

      

Unaffiliated issuers

  $825,638,340     $32,651,804 

Affiliated issuers

          

Foreign currency

   105,237      11,836 

 

*

Includes a sales load of 5.75% for the International, Global, Global Equity Income, Emerging Markets Value, International Small Cap, and Small Cap Value Funds and 3.75% for the Core Plus Fixed Income Fund. (see Note 7 of the Notes to Financial Statements)

 

The accompanying notes to financial statements are an integral part of these statements.

 

68


Brandes Investment Trust

STATEMENTS OF ASSETS AND LIABILITIES — September 30, 2019 (continued)

 

 

 

Brandes
Global Equity
Income Fund

  Brandes
Emerging
Markets
Value Fund
  Brandes
International
Small Cap

Equity Fund
  Brandes
Small Cap
Value Fund
  Brandes
Core Plus Fixed
Income Fund
 
    
    
$1,448,186  $1,422,210,040  $499,227,202  $515,414  $86,344,387 
    778,538   2,337,628       
 530      29,146       
    
       42,985       
    2,055,657   3,283,407       
 6,431   3,021,666   1,830,805   556   428,656 
              
 1,562   79,591   362,929   11    
              
 15,732         17,923    
 3,115   40,545   20,086   15,014   13,915 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
 1,475,556   1,428,186,037   507,134,188   548,918   86,786,958 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
    
    
 151   5,398,478   20,437,324      86,668 
    990,378   434,438      6,159 
 11   59,786   13,397   3   742 
 40   46,519   19,556   173   2,754 
 337   106,934   27,792   205   1,988 
 141   1,386,444   75,275      3,305 
 433   350,862   140,496   16    
 2      10       
 67,502   651,428   388,998   67,392   134,316 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
 68,617   8,990,829   21,537,286   67,789   235,932 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
$1,406,939  $1,419,195,208  $485,596,902  $481,129  $86,551,026 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
    
$1,400,491  $1,627,207,779  $735,430,876  $683,383  $86,372,482 
 6,448   (208,012,571  (249,833,974  (202,254  178,544 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
$1,406,939  $1,419,195,208  $485,596,902  $481,129  $86,551,026 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
    
    
$30,153  $235,872,973  $43,459,402  $7,497  $3,224,627 
 2,708   27,508,096   4,252,420   873   351,138 
$11.13  $8.57  $10.22  $8.58  $9.18 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
$11.81  $9.10  $10.84  $9.11  $9.54 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
    
$4,974  $18,045,263  $6,878,228   N/A   N/A 
 464   2,114,934   692,187   N/A   N/A 
$10.71  $8.53  $9.94   N/A   N/A 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
    
$1,371,812  $1,117,688,152  $414,815,896  $473,544  $83,326,292 
 129,480   129,698,133   40,452,353   54,944   9,000,810 
$10.59  $8.62  $10.25  $8.62  $9.26 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
    
 N/A  $47,588,820  $20,443,376   88   107 
 N/A   5,501,942   1,989,837   11   12 
 N/A  $8.65  $10.27  $7.97  $9.26 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
    
    
$1,463,537  $1,595,091,922  $584,642,484  $522,811  $84,339,730 
    12,202,165   30,880,966       
 530      29,523       

 

The accompanying notes to financial statements are an integral part of these statements.

 

69


Brandes Investment Trust

STATEMENTS OF OPERATIONS — For the Year Ended September 30, 2019

 

 

 

       
Brandes
International
Equity Fund
     Brandes
Global

Equity Fund
 

INVESTMENT INCOME

      

Income

      

Dividend income

      

Unaffiliated issuers

  $35,073,224     $1,710,601 

Affiliated issuers

          

Less: Foreign taxes withheld

   (3,692,775     (116,080

Interest income

   281,665      7,109 

Income from securities lending

   392,073      9,863 

Miscellaneous Income

          
  

 

 

     

 

 

 

Total Income

   32,054,187      1,611,493 
  

 

 

     

 

 

 

Expenses

      

Advisory fees (Note 3)

   5,780,755      382,961 

Custody fees

   76,780      6,512 

Administration fees (Note 3)

   192,500      25,084 

Insurance expense

   15,325      1,456 

Legal fees

   35,879      2,445 

Printing fees

   59,818      4,774 

Miscellaneous

   40,978      5,926 

Registration expense

   112,417      45,795 

Trustee fees

   95,498      6,831 

Transfer agent fees

   159,107      48,453 

12b-1 Fees - Class A

   85,885      5,202 

12b-1 Fees - Class C

   119,460      10,268 

Shareholder Service Fees - Class C

   39,820      3,423 

Sub-Transfer Agency Fees - Class I

   326,473      22,210 

Accounting fees

   80,467      59,176 

Auditing fees

   42,736      38,458 

Offering Costs

          
  

 

 

     

 

 

 

Total expenses

   7,263,898      668,974 

Expenses waived

   (202,211     (171,380

Expenses recouped

          
  

 

 

     

 

 

 

Total net expenses

   7,061,687      497,594 
  

 

 

     

 

 

 

Net investment income

   24,992,500      1,113,899 
  

 

 

     

 

 

 

REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS

      

Net realized gain (loss) on:

      

Unaffiliated investments

   (2,065,397     (1,072,737

Affiliated investments

          

Redemption in-kind (Note 10)

         91,756 

Foreign currency transactions

   (312,368     (34,297
  

 

 

     

 

 

 

Net realized gain (loss)

   (2,377,765     (1,015,278
  

 

 

     

 

 

 

Net change in unrealized appreciation (depreciation) on:

      

Investments

   (69,944,066     (3,780,920

Foreign currency transactions

   (28,967     (200
  

 

 

     

 

 

 

Net change in unrealized appreciation (depreciation)

   (69,973,033     (3,781,120
  

 

 

     

 

 

 

Net realized and unrealized gain (loss) on investments and foreign currency transactions

   (72,350,798     (4,796,398
  

 

 

     

 

 

 

Net increase (decrease) in net assets resulting from operations

  $(47,358,298)     $(3,682,499) 
  

 

 

     

 

 

 

 

The accompanying notes to financial statements are an integral part of these statements.

 

70


Brandes Investment Trust

STATEMENTS OF OPERATIONS — For the Year Ended September 30, 2019 (continued)

 

 

 

Brandes
Global Equity
Income Fund

  Brandes
Emerging
Markets
Value Fund
  Brandes
International
Small Cap
Equity Fund
  Brandes
Small Cap
Value Fund
  Brandes
Core Plus Fixed
Income Fund
 
    
    
    
$61,166  $58,837,092  $19,752,049  $98,807  $18,328 
       160,701       
 (4,672  (7,566,790  (1,715,837  (2,947   
 8   169,265   271,770   19,925   2,850,648 
 1      81,580       
       29,429   1,257    

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
 56,503   51,439,567   18,579,692   117,042   2,868,976 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
    
 10,645   13,666,520   6,569,287   47,956   294,429 
 1,921   680,663   195,158   1,618   11,801 
 13,580   359,223   177,052   13,413   33,456 
 4   31,756   25,436   180   2,002 
 63   67,740   32,835   385   3,985 
 1,841   98,838   39,823   2,998   6,039 
 2,957   115,473   70,061   2,570   5,810 
 7,769   105,070   77,230   36,363   53,692 
 914   178,565   81,810   2,798   11,496 
 45,129   337,944   188,548   44,673   51,693 
 76   617,880   151,496   42   5,437 
 37   152,134   73,459   N/A   N/A 
 12   50,711   24,486   N/A   N/A 
 648   566,316   280,696   1,821   40,974 
 56,572   90,631   83,064   48,825   58,520 
 33,294   41,150   39,306   35,128   38,599 
          15,691    

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
 175,462   17,160,614   8,109,747   254,461   617,933 
 (162,031  (352,747  (58,771  (198,545  (192,970
    20,458          

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
 13,431   16,828,325   8,050,976   55,916   424,963 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
 43,072   34,611,242   10,528,716   61,126   2,444,013 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
    
    
 21,541   20,752,214   (68,904,313  (245,372  (950,890
       (47,603,149      
          (959,099   
 (64  313,477   (42,701  (52   

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
 21,477   21,065,691   (116,550,163  (1,204,523  (950,890

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
    
 (93,988  (16,858,102  (6,809,821  83,063   3,872,912 
 (109  (50,755  13,121       

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
 (94,097  (16,908,857  (6,796,700  83,063   3,872,912 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

 

(72,620

  4,156,834   (123,346,863  (1,121,460  2,922,022 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 
$(29,548 $38,768,076  $(112,818,147 $(1,060,334 $5,366,035 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

 

The accompanying notes to financial statements are an integral part of these statements.

 

71


Brandes Investment Trust

STATEMENT OF CHANGES IN NET ASSETS

 

 

 

  Brandes International Equity
Fund
  Brandes Global
Equity Fund
 
  Year ended
September 30,
2019
  Year ended
September 30,
2018(1)
  Year ended
September 30,
2019
  Year ended
September 30,
2018(2)
 

INCREASE (DECREASE) IN NET ASSETS FROM:

    

OPERATIONS

    

Net investment income

 $24,992,500  $14,011,486  $1,113,899  $1,348,817 

Net realized gain (loss) on:

    

Investments

  (2,065,397  25,391,080   (1,072,737  2,874,455 

Redemption in-kind

        91,756    

Foreign currency transactions

  (312,368  (210,171  (34,297  (10,426

Net unrealized appreciation (depreciation) on:

    

Investments

  (69,944,066  (17,141,192  (3,780,920  (732,898

Foreign currency transactions

  (28,967  (41,489  (200  (281
 

 

 

  

 

 

  

 

 

  

 

 

 

Net increase (decrease) in net assets resulting from operations

  (47,358,298  22,009,714   (3,682,499  3,479,667 
 

 

 

  

 

 

  

 

 

  

 

 

 

DISTRIBUTIONS TO SHAREHOLDERS

    

Distributions to shareholders

    

Class A

  (1,307,402  (569,062  (174,666  (195,704

Class C

  (502,763  (240,746  (90,070  (48,710

Class I

  (25,706,405  (10,567,066  (3,614,095  (2,487,609

Class R6

  (1,310,485  (440,184  N/A   N/A 
 

 

 

  

 

 

  

 

 

  

 

 

 

Decrease in net assets from distributions

  (28,827,055  (11,817,058  (3,878,831  (2,732,023
 

 

 

  

 

 

  

 

 

  

 

 

 

CAPITAL SHARE TRANSACTIONS

    

Proceeds from shares sold

  352,119,388   280,183,460   5,549,682   5,255,435 

Net asset value of shares issued on reinvestment of distributions

  27,122,568   11,008,451   3,840,206   2,710,260 

Cost of shares redeemed

  (342,230,968  (169,897,059  (31,256,592  (10,290,630

Cost of shares redeemed from redemption in-kind (Note 10)

        (2,112,940   
 

 

 

  

 

 

  

 

 

  

 

 

 

Net increase (decrease) in net assets from capital share transactions

  37,010,988   121,294,852   (23,979,644  (2,324,935
 

 

 

  

 

 

  

 

 

  

 

 

 

Total increase (decrease) in net assets

  (39,174,365  131,487,508   (31,540,974  (1,577,291
 

 

 

  

 

 

  

 

 

  

 

 

 

NET ASSETS

    

Beginning of the Period

  742,538,841   611,051,333   67,612,783   69,190,074 
 

 

 

  

 

 

  

 

 

  

 

 

 

End of the Period

 $703,364,476  $742,538,841  $36,071,809  $67,612,783 
 

 

 

  

 

 

  

 

 

  

 

 

 

 

(1) 

Distributions to shareholders includes net investment income distributions of $569,062, $240,746, $10,567,066 and $440,184 for the A, C, I and R6 classes, respectively. End of period net assets includes accumulated undistributed net investment income of $1,537,706.

(2) 

Distributions to shareholders includes net investment income distributions of $72,745, $15,982 and $1,223,998, and net realized gains distributions of $122,959, $32,728 and $1,263,611 for the A, C and I classes, respectively. End of period net assets includes accumulated undistributed net investment loss of $62,335.

 

The accompanying notes to financial statements are an integral part of these statements.

 

72


Brandes Investment Trust

STATEMENT OF CHANGES IN NET ASSETS (continued)

 

 

 

  Brandes Global Equity Income
Fund
  Brandes Emerging Markets
Value Fund
 
  Year
ended
September 30,
2019
  Year
ended
September 30,
2018(1)
  Year
ended
September 30,
2019
  Year
ended
September 30,
2018(2)
 

INCREASE (DECREASE) IN NET ASSETS FROM:

    

OPERATIONS

    

Net investment income

 $43,072  $31,967  $34,611,242  $31,671,556 

Net realized gain (loss) on:

    

Investments

  21,541   53,581   20,752,214   101,866,689 

Foreign currency transactions

  (64  (260  313,477   (2,992,329

Net unrealized appreciation (depreciation) on:

    

Investments

  (93,988  (48,419  (16,858,102  (297,507,481

Foreign currency transactions

  (109  (171  (50,755  31,294 
 

 

 

  

 

 

  

 

 

  

 

 

 

Net increase (decrease) in net assets resulting from operations

  (29,548  36,698   38,768,076   (166,930,271
 

 

 

  

 

 

  

 

 

  

 

 

 

DISTRIBUTIONS TO SHAREHOLDERS

    

Distributions to shareholders

    

Class A

  (1,865  (685  (4,270,926  (4,492,509

Class C

  (272  (21  (219,104  (224,759

Class I

  (83,638  (64,304  (22,135,574  (23,654,042

Class R6

  N/A   N/A   (859,192  (1,345,870
 

 

 

  

 

 

  

 

 

  

 

 

 

Decrease in net assets from distributions

  (85,775  (65,010  (27,484,796  (29,717,180
 

 

 

  

 

 

  

 

 

  

 

 

 

CAPITAL SHARE TRANSACTIONS

    

Proceeds from shares sold

  98,095   339,640   469,166,542   532,236,709 

Net asset value of shares issued on reinvestment of distributions

  83,916   62,888   24,989,132   26,393,702 

Cost of shares redeemed

  (47,982  (28,697  (563,551,771  (640,989,583
 

 

 

  

 

 

  

 

 

  

 

 

 

Net increase (decrease) in net assets from capital share transactions

  134,029   373,831   (69,396,097  (82,359,172
 

 

 

  

 

 

  

 

 

  

 

 

 

Total increase (decrease) in net assets

  18,706   345,519   (58,112,817  (279,006,623
 

 

 

  

 

 

  

 

 

  

 

 

 

NET ASSETS

    

Beginning of the Period

  1,388,233   1,042,714   1,477,308,025   1,756,314,648 
 

 

 

  

 

 

  

 

 

  

 

 

 

End of the Period

 $1,406,939  $1,388,233  $1,419,195,208  $1,477,308,025 
 

 

 

  

 

 

  

 

 

  

 

 

 

 

(1) 

Distributions to shareholders includes net investment income distributions of $681, $17 and $30,179, and net realized gains distributions of $4, $4 and $34,125 for the A, C and I classes, respectively. End of period net assets includes accumulated undistributed net investment income of $935.

(2) 

Distributions to shareholders includes net investment income distributions of $4,492,509, $224,759, $23,654,042 and $1,345,870 for the A, C, I and R6 classes, respectively. End of period net assets includes accumulated undistributed net investment loss of $10,547,353.

 

The accompanying notes to financial statements are an integral part of these statements.

 

73


Brandes Investment Trust

STATEMENT OF CHANGES IN NET ASSETS (continued)

 

 

 

  Brandes International Small
Cap Equity Fund
  Brandes Small Cap Value Fund 
  Year
ended
September 30,
2019
  Year
ended
September 30,
2018(1)
  Year
ended
September 30,
2019
  Period
ended
September 30,
2018(2)(3)
 

INCREASE (DECREASE) IN NET ASSETS FROM:

    

OPERATIONS

    

Net investment income

 $10,528,716  $18,413,109  $61,126  $39,189 

Net realized gain (loss) on:

    

Investments

  (116,507,462  76,959,441   (245,372  500,680 

Redemption in-kind

        (959,099   

Foreign currency transactions

  (42,701  (807,207  (52   

Net unrealized appreciation (depreciation) on:

    

Investments

  (6,809,821  (212,419,367  83,063   (90,460

Foreign currency transactions

  13,121   166,032       
 

 

 

  

 

 

  

 

 

  

 

 

 

Net increase (decrease) in net assets resulting from operations

  (112,818,147  (117,687,992  (1,060,334  449,409 
 

 

 

  

 

 

  

 

 

  

 

 

 

DISTRIBUTIONS TO SHAREHOLDERS

    

Distributions to shareholders

    

Class A

  (2,579,162  (11,119,388  (1,892  (166

Class C

  (381,674  (1,848,988  N/A   N/A 

Class I

  (22,475,604  (109,207,423  (396,607  (20,004

Class R6

  (2,449,141  (5,700,213  (347,896  (19,482
 

 

 

  

 

 

  

 

 

  

 

 

 

Decrease in net assets from distributions

  (27,885,581  (127,876,012  (746,395  (39,652
 

 

 

  

 

 

  

 

 

  

 

 

 

CAPITAL SHARE TRANSACTIONS

  �� 

Proceeds from shares sold

  193,681,212   400,890,576   5,000   1,813,264 

Proceeds from Transfer in-kind (Note 10)

           8,132,782 

Net asset value of shares issued on reinvestment of distributions

  26,544,230   123,508,821   746,395   39,652 

Cost of shares redeemed

  (725,653,118  (971,216,787  (5,184,173  (65,620

Cost of shares redeemed from redemption in-kind (Note 10)

        (3,609,199   
 

 

 

  

 

 

  

 

 

  

 

 

 

Net increase (decrease) in net assets from capital share transactions

  (505,427,676  (446,817,390  (8,041,977  9,920,078 
 

 

 

  

 

 

  

 

 

  

 

 

 

Total increase (decrease) in net assets

  (646,131,404  (692,381,394  (9,848,706  10,329,835 
 

 

 

  

 

 

  

 

 

  

 

 

 

NET ASSETS

    

Beginning of the Period

  1,131,728,306   1,824,109,700   10,329,835    
 

 

 

  

 

 

  

 

 

  

 

 

 

End of the Period

 $485,596,902  $1,131,728,306  $481,129  $10,329,835 
 

 

 

  

 

 

  

 

 

  

 

 

 

 

(1) 

Distributions to shareholders includes net investment income distributions of $5,950,910, $957,993, $60,072,418 and $3,193,839, and net realized gains distributions of $5,168,478, $890,995, $49,135,005 and $2,506,374 for the A, C, I and R6 classes, respectively. End of period net assets includes accumulated undistributed net investment loss of $11,039,962.

(2) 

Distributions to shareholders includes net investment income distributions of $166, $20,004 and $19,482 for the A, I and R6 classes, respectively. End of period net assets includes accumulated undistributed net investment income of $2,480.

(3) 

Commenced operations on January 2, 2018.

 

The accompanying notes to financial statements are an integral part of these statements.

 

74


Brandes Investment Trust

STATEMENT OF CHANGES IN NET ASSETS (continued)

 

 

 

  Brandes Core Plus Fixed
Income Fund
 
  Year
ended
September 30,
2019
  Year
ended
September 30,
2018(1)
 

INCREASE (DECREASE) IN NET ASSETS FROM:

  

OPERATIONS

  

Net investment income

 $2,444,013  $2,720,051 

Net realized gain (loss) on:

  

Investments

  (950,890  (734,191

Foreign currency transactions

      

Net unrealized appreciation (depreciation) on:

  

Investments

  3,872,912   (2,975,754

Foreign currency transactions

      
 

 

 

  

 

 

 

Net increase (decrease) in net assets resulting from operations

  5,366,035   (989,894
 

 

 

  

 

 

 

DISTRIBUTIONS TO SHAREHOLDERS

  

Distributions to shareholders

  

Class A

  (58,426  (64,040

Class I

  (2,372,519  (2,657,099

Class R6

  (4  (4
 

 

 

  

 

 

 

Decrease in net assets from distributions

  (2,430,949  (2,721,143
 

 

 

  

 

 

 

CAPITAL SHARE TRANSACTIONS

  

Proceeds from shares sold

  15,713,889   34,243,797 

Net asset value of shares issued on reinvestment of distributions

  2,391,447   2,679,959 

Cost of shares redeemed

  (25,992,319  (42,896,480
 

 

 

  

 

 

 

Net increase (decrease) in net assets from capital share transactions

  (7,886,983  (5,972,724
 

 

 

  

 

 

 

Total increase (decrease) in net assets

  (4,951,897  (9,683,761
 

 

 

  

 

 

 

NET ASSETS

  

Beginning of the Period

  91,502,923   101,186,684 
 

 

 

  

 

 

 

End of the Period

 $86,551,026  $91,502,923 
 

 

 

  

 

 

 

 

(1) 

Distributions to shareholders includes net investment income distributions of $64,040, $2,657,099 and $4 for the A, I and R6 classes, respectively. End of period net assets includes accumulated undistributed net investment income of $19,107.

 

The accompanying notes to financial statements are an integral part of these statements.

 

75


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

   Net asset
value,
beginning
of period
  Net
investment
income(5)
      
    
Net
realized and
unrealized
gain (loss) on
investments
  Total from
investment
operations
  Dividends
from net
investment
income
 

Brandes International Equity Fund

     

Class A

     

9/30/2019

 $17.71   0.53   (1.59  (1.06  (0.63

9/30/2018

 $17.48   0.36   0.17   0.53   (0.30

9/30/2017

 $15.70   0.29   2.03   2.32   (0.54

9/30/2016

 $14.90   0.35   0.81   1.16   (0.36

9/30/2015

 $16.58   0.35   (1.73  (1.38  (0.30

Class C

     

9/30/2019

 $17.47   0.40   (1.58  (1.18  (0.53

9/30/2018

 $17.30   0.22   0.18   0.40   (0.23

9/30/2017

 $15.58   0.17   2.00   2.17   (0.45

9/30/2016

 $14.79   0.23   0.81   1.04   (0.25

9/30/2015

 $16.48   0.24   (1.73  (1.49  (0.20

Class I

     

9/30/2019

 $17.76   0.56   (1.60  (1.04  (0.65

9/30/2018

 $17.52   0.40   0.16   0.56   (0.32

9/30/2017

 $15.72   0.33   2.04   2.37   (0.57

9/30/2016

 $14.92   0.38   0.81   1.19   (0.39

9/30/2015

 $16.60   0.35   (1.70  (1.35  (0.33

Class R6

     

9/30/2019

 $17.83   0.59   (1.61  (1.02  (0.66

9/30/2018

 $17.56   0.42   0.18   0.60   (0.33

9/30/2017

 $15.74   0.35   2.04   2.39   (0.57

2/1/2016(3) – 9/30/2016

 $14.41   0.27   1.39   1.66   (0.33

 

 

(1)

Not annualized.

(2)

Annualized.

(3)

Commencement of operations.

(4)

After fees waived and expenses absorbed or recouped by the Advisor, where applicable.

(5)

Net investment income per share has been calculated based on average shares outstanding during the period.

(6)

The total return calculation does not reflect the sales loads that may be imposed on Class A or C shares (see Note 7 of the Notes to Financial Statements).

(7)

The total return figure is the since inception return for the class.

(8)

Includes expenses not covered by the Trust’s expense limitation agreement. See Note 3 for more information.

(9)

As of June 30, 2019, the expense cap for the class changed from 1.00% to 0.85%.

(10)

As of June 30, 2019, the expense cap for the class changed from 0.82% to 0.75%.

 

The accompanying notes to financial statements are an integral part of these statements.

 

76


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

Net asset
value, end
of period
  Total
return(6)
  Net assets,
end of
period
(millions)
  Ratio of
net expenses
to average
net assets(4)
  Ratio of net
investment
income to
average
net assets(4)
  Ratio of
expenses (prior
to reimburse-
ments) to
average
net assets
  Ratio of net
investment
income (prior
to reimburse-
ments) to
average
net assets
  Portfolio
turnover
rate
 
       
       
$16.02   -5.98 $32.0   1.16  3.21  1.16  3.21  14.43
$17.71   3.02 $34.9   1.16  2.00  1.16  2.00  20.37
$17.48   15.07 $31.5   1.18%(8)   1.77  1.18%(8)   1.77  33.82
$15.70   7.90 $14.3   1.18  2.30  1.18  2.30  17.60
$14.90   -8.47 $13.1   1.18  2.08  1.18  2.08  27.50
       
$15.76   -6.73 $13.1   1.91  2.46  1.91  2.46  14.43
$17.47   2.31 $18.3   1.91  1.25  1.91  1.25  20.37
$17.30   14.19 $17.9   1.93%(8)   1.01  1.93%(8)   1.01  33.82
$15.58   7.10 $13.1   1.93  1.55  1.93  1.55  17.60
$14.79   -9.14 $12.0   1.93  1.43  1.93  1.43  27.50
       
$16.07   -5.82 $622.4   0.94%(9)   3.43  0.96%(9)   3.41  14.43
$17.76   3.23 $664.7   0.96  2.20  0.96  2.20  20.37
$17.52   15.33 $523.1   0.98%(8)   1.96  0.98%(8)   1.96  33.82
$15.72   8.10 $648.3   1.00  2.48  0.98  2.50  17.60
$14.92   -8.30 $562.5   1.00  2.10  0.98  2.12  27.50
       
$16.15   -5.69 $35.9   0.80%(10)   3.57  0.91%(10)   3.46  14.43
$17.83   3.44 $24.6   0.82  2.34  0.91  2.25  20.37
$17.56   15.48 $38.5   0.83%(8)   2.12  0.93%(8)   2.02  33.82
$15.74   11.60%(7)  $27.7   0.82%(2)   2.67%(2)   0.93%(2)   2.56%(2)   17.60%(1) 

 

The accompanying notes to financial statements are an integral part of these statements.

 

77


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

   Net asset
value,
beginning
of period
  Net
investment
income(2)
      
    
Net
realized and
unrealized
gain (loss) on
investments
  Total from
investment
operations
  Dividends
from net
investment
income
  Dividends
from net
realized
gains
 

Brandes Global Equity Fund

 

    

Class A

      

9/30/2019

 $24.61   0.47   (1.80  (1.33  (0.48  (1.05

9/30/2018

 $24.42   0.43   0.69   1.12   (0.42  (0.51

9/30/2017

 $21.21   0.34   3.28   3.62   (0.41   

9/30/2016

 $21.85   0.40   0.67   1.07   (0.42  (1.29

9/30/2015

 $25.43   0.27   (1.90  (1.63  (0.33  (1.62

Class C

      

9/30/2019

 $24.45   0.30   (1.78  (1.48  (0.32  (1.05

9/30/2018

 $24.28   0.24   0.69   0.93   (0.25  (0.51

9/30/2017

 $21.09   0.18   3.25   3.43   (0.24   

9/30/2016

 $21.73   0.25   0.66   0.91   (0.26  (1.29

9/30/2015

 $25.31   0.16   (1.92  (1.76  (0.20  (1.62

Class I

      

9/30/2019

 $24.77   0.53   (1.81  (1.28  (0.53  (1.05

9/30/2018

 $24.57   0.49   0.70   1.19   (0.48  (0.51

9/30/2017

 $21.33   0.41   3.30   3.71   (0.47   

9/30/2016

 $21.95   0.46   0.67   1.13   (0.46  (1.29

9/30/2015

 $25.52   0.39   (1.97  (1.58  (0.37  (1.62

 

 

(1)

After fees waived and expenses absorbed or recouped by the Advisor, where applicable.

(2)

Net investment income per share has been calculated based on average shares outstanding during the period.

(3)

The total return calculation does not reflect the sales loads that may be imposed on Class A or C shares (see Note 7 of the Notes to Financial Statements).

(4)

Includes expenses not covered by the Trust’s expense limitation agreement. See Note 3 for more information.

 

The accompanying notes to financial statements are an integral part of these statements.

 

78


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

Net asset
value, end
of period
  Total
return(3)
  Net assets,
end of
period
(millions)
  Ratio of
net expenses
to average
net assets(1)
  Ratio of net
investment
income to
average
net assets(1)
  Ratio of
expenses (prior
to reimburse-
ments) to
average
net assets
  Ratio of net
investment
income (prior
to reimburse-
ments) to
average
net assets
  Portfolio
turnover
rate
 
       
       
$21.75   -5.22 $1.5   1.25  2.11  1.56  1.81  12.11
$24.61   4.68 $3.4   1.25  1.72  1.40  1.57  8.89
$24.42   17.20 $5.8   1.26%(4)   1.52  1.45%(4)   1.33  17.42
$21.21   5.01 $4.6   1.25  1.95  1.58  1.62  15.68
$21.85   -6.99 $1.8   1.25  1.15  1.66  0.74  25.06
       
$21.60   -5.91 $1.2   2.00  1.37  2.32  1.05  12.11
$24.45   3.88 $1.6   2.00  0.97  2.15  0.82  8.89
$24.28   16.31 $1.7   2.01%(4)   0.77  2.21%(4)   0.57  17.42
$21.09   4.20 $2.0   2.00  1.20  2.32  0.88  15.68
$21.73   -7.62 $2.4   2.00  0.66  2.42  0.24  25.06
       
$21.91   -4.98 $33.4   1.00  2.37  1.36  2.00  12.11
$24.77   4.95 $62.6   1.00  1.97  1.20  1.77  8.89
$24.57   17.48 $61.7   1.01%(4)   1.77  1.26%(4)   1.52  17.42
$21.33   5.26 $47.3   1.00  2.20  1.38  1.82  15.68
$21.95   -6.75 $46.0   1.00  1.61  1.47  1.14  25.06

 

The accompanying notes to financial statements are an integral part of these statements.

 

79


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

   Net asset
value,
beginning
of period
  Net
investment
income(5)
      
    
Net
realized and
unrealized
gain (loss) on
investments
  Total from
investment
operations
  Dividends
from net
investment
income
  Dividends
from net
realized
gains
 

Brandes Global Equity Income Fund

 

    

Class A

      

9/30/2019

 $12.12   0.34   (0.64  (0.30  (0.33  (0.36

9/30/2018

 $12.46   0.30   0.02   0.32   (0.26  (0.40

9/30/2017

 $10.79   0.24   1.73   1.97   (0.04  (0.26

9/30/2016

 $9.62   0.28   1.35   1.63   (0.26  (0.20

12/31/2014(3) – 9/30/2015

 $10.00   0.23   (0.46  (0.23  (0.15   

Class C

      

9/30/2019

 $11.69   0.24   (0.61  (0.37  (0.25  (0.36

9/30/2018

 $11.97   0.20   0.11   0.31   (0.19  (0.40

9/30/2017

 $10.72   0.16   1.50   1.66   (0.15  (0.26

9/30/2016

 $9.60   0.20   1.31   1.51   (0.19  (0.20

12/31/2014(3) – 9/30/2015

 $10.00   0.23   (0.52  (0.29  (0.11   

Class I

      

9/30/2019

 $11.57   0.35   (0.62  (0.27  (0.35  (0.36

9/30/2018

 $11.87   0.32   0.06   0.38   (0.28  (0.40

9/30/2017

 $10.68   0.27   1.45   1.72   (0.27  (0.26

9/30/2016

 $9.57   0.29   1.30   1.59   (0.28  (0.20

12/31/2014(3) – 9/30/2015

 $10.00   0.23   (0.45  (0.22  (0.21   

 

 

(1)

Not annualized.

(2)

Annualized.

(3)

Commencement of operations.

(4)

After fees waived and expenses absorbed or recouped by the Advisor, where applicable.

(5)

Net investment income per share has been calculated based on average shares outstanding during the period.

(6)

The total return calculation does not reflect the sales loads that may be imposed on Class A or C shares (see Note 7 of the Notes to Financial Statements).

(7)

The total return figure is the since inception return for the class.

(8)

Amount is less than $50,000.

(9)

Includes expenses not covered by the Trust’s expense limitation agreement. See Note 3 for more information.

 

The accompanying notes to financial statements are an integral part of these statements.

 

80


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

Net asset
value, end
of period
  Total
return(6)
  Net assets,
end of
period
(millions)
  Ratio of
net expenses
to average
net assets(4)
  Ratio of net
investment
income to
average
net assets(4)
  Ratio of
expenses (prior
to reimburse-
ments) to
average
net assets
  Ratio of net
investment
income (prior
to reimburse-
ments) to
average
net assets
  Portfolio
turnover
rate
 
       
       
$11.13   -2.29 $(8)   1.25  3.00  13.38  (9.13)%   7.52
$12.12   2.66 $(8)   1.25  2.47  13.81  (10.09)%   16.42
$12.46   18.81 $(8)   1.27%(9)   2.17  18.00%(9)   (14.56)%   12.97
$10.79   17.35 $(8)   1.25  2.67  20.41  (16.49)%   22.38
$9.62   -2.44%(7)  $(8)   1.25%(2)   2.90%(2)   570.42%(2)   (566.27)%(2)   16.78%(1) 
       
$10.71   -2.91 $(8)   2.00  2.25  14.12  (9.87)%   7.52
$11.69   2.64 $(8)   2.00  1.68  15.76  (12.08)%   16.42
$11.97   16.01 $(8)   2.00%(9)   1.44  17.88%(9)   (14.44)%   12.97
$10.72   16.01 $(8)   2.00  1.91  21.51  (17.60)%   22.38
$9.60   -2.99%(7)  $(8)   2.00%(2)   2.90%(2)   572.75%(2)   (567.85)%(2)   16.78%(1) 
       
$10.59   -2.09 $1.4   1.00  3.25  13.18  (8.93)%   7.52
$11.57   3.33 $1.4   1.00  2.70  14.47  (10.77)%   16.42
$11.87   16.71 $1.0   1.00%(9)   2.45  16.88%(9)   (13.43)%   12.97
$10.68   16.98 $0.9   1.00  2.91  24.04  (20.13)%   22.38
$9.57   -2.36%(7)  $0.6   1.00%(2)   2.90%(2)   37.61%(2)   (33.71)%(2)   16.78%(1) 

 

The accompanying notes to financial statements are an integral part of these statements.

 

81


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

   Net asset
value,
beginning
of period
  Net
investment
income(5)
      
    
Net
realized and
unrealized
gain (loss) on
investments
  Total from
investment
operations
  Dividends
from net
investment
income
  Dividends
from net
realized
gains
 

Brandes Emerging Markets Value Fund

 

   

Class A

      

9/30/2019

 $8.46   0.19   0.07   0.26   (0.15   

9/30/2018

 $9.47   0.15   (1.01  (0.86  (0.15   

9/30/2017

 $7.91   0.10   1.60   1.70   (0.14   

9/30/2016

 $6.19   0.12   1.69   1.81   (0.09   

9/30/2015

 $9.56   0.11   (3.12  (3.01  (0.13  (0.23

Class C

      

9/30/2019

 $8.44   0.13   0.06   0.19   (0.10   

9/30/2018

 $9.43   0.08   (0.99  (0.91  (0.08   

9/30/2017

 $7.86   0.05   1.58   1.63   (0.06   

9/30/2016

 $6.15   0.07   1.67   1.74   (0.03   

9/30/2015

 $9.51   0.05   (3.10  (3.05  (0.08  (0.23

Class I

      

9/30/2019

 $8.50   0.21   0.08   0.29   (0.17   

9/30/2018

 $9.51   0.17   (1.01  (0.84  (0.17   

9/30/2017

 $7.94   0.13   1.60   1.73   (0.16   

9/30/2016

 $6.21   0.14   1.70   1.84   (0.11   

9/30/2015

 $9.58   0.13   (3.12  (2.99  (0.15  (0.23

Class R6

      

9/30/2019

 $8.53   0.23   0.07   0.30   (0.18   

9/30/2018

 $9.53   0.19   (1.02  (0.83  (0.17   

9/30/2017

 $7.93   0.15   1.62   1.77   (0.17   

7/11/2016(3) – 9/30/2016

 $7.54   0.04   0.38   0.42   (0.03   

 

 

(1)

Not annualized.

(2)

Annualized.

(3)

Commencement of operations.

(4)

After fees waived and expenses absorbed or recouped by the Advisor, where applicable.

(5)

Net investment income per share has been calculated based on average shares outstanding during the period.

(6)

The total return calculation does not reflect the sales loads that may be imposed on Class A or C shares (see Note 7 of the Notes to Financial Statements).

(7)

The total return figure is the since inception return for the class.

(8)

Amount is less than $50,000.

(9)

Includes expenses not covered by the Trust’s expense limitation agreement. See Note 3 for more information.

 

The accompanying notes to financial statements are an integral part of these statements.

 

82


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

Net asset
value, end
of period
  Total
return(6)
  Net assets,
end of
period
(millions)
  Ratio of
net expenses
to average
net assets(4)
  Ratio of net
investment
income to
average
net assets(4)
  Ratio of
expenses (prior
to reimburse-
ments) to
average
net assets
  Ratio of net
investment
income (prior
to reimburse-
ments) to
average
net assets
  Portfolio
turnover
rate
 
       
       
$8.57   3.10 $235.9   1.35  2.23  1.35  2.23  22.09
$8.46   -9.14 $258.8   1.37  1.62  1.34  1.65  37.66
$9.47   21.78 $319.2   1.42%(9)   1.27  1.40%(9)   1.29  23.67
$7.91   29.38 $305.0   1.37  1.74  1.39  1.72  26.48
$6.19   -32.32 $295.6   1.37  1.46  1.40  1.43  35.02
       
$8.53   2.27 $18.0   2.10  1.48  2.10  1.48  22.09
$8.44   -9.70 $22.8   2.10  0.89  2.09  0.90  37.66
$9.43   20.83 $28.2   2.17%(9)   0.52  2.14%(9)   0.55  23.67
$7.86   28.38 $22.4   2.12  0.99  2.14  0.97  26.48
$6.15   -32.83 $18.4   2.12  0.62  2.14  0.60  35.02
       
$8.62   3.41 $1,117.7   1.12  2.46  1.15  2.43  22.09
$8.50   -8.91 $1,162.1   1.12  1.88  1.14  1.86  37.66
$9.51   22.07 $1,311.5   1.17%(9)   1.51  1.20%(9)   1.48  23.67
$7.94   29.70 $829.0   1.12  1.99  1.19  1.92  26.48
$6.21   -32.13 $725.1   1.12  1.58  1.19  1.51  35.02
       
$8.65   3.45 $47.6   0.97  2.61  1.10  2.48  22.09
$8.53   -8.74 $33.6   0.97  2.02  1.08  1.91  37.66
$9.53   22.53 $97.4   1.02%(9)   1.68  1.17%(9)   1.53  23.67
$7.93   5.59%(7)  $(8)   0.97%(2)   2.14%(2)   1.14%(2)   1.97%(2)   26.48%(1) 

 

The accompanying notes to financial statements are an integral part of these statements.

 

83


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

   Net asset
value,
beginning
of period
  Net
investment
income
(loss)(5)
      
    
Net
realized and
unrealized
gain (loss) on
investments
  Total from
investment
operations
  Dividends
from net
investment
income
  Dividends
from net
realized
gains
 

Brandes International Small Cap Equity Fund

 

  

Class A

      

9/30/2019

 $12.10   0.15   (1.60  (1.45  (0.30  (0.13

9/30/2018

 $14.30   0.14   (1.32  (1.18  (0.54  (0.48

9/30/2017

 $13.46   0.14   1.32   1.46   (0.34  (0.28

9/30/2016

 $12.58   0.09   1.22   1.31   (0.23  (0.20

9/30/2015

 $13.55   0.04   (0.43  (0.39  (0.17  (0.41

Class C

      

9/30/2019

 $11.81   0.06   (1.55  (1.49  (0.25  (0.13

9/30/2018

 $14.03   0.04   (1.28  (1.24  (0.50  (0.48

9/30/2017

 $13.24   0.04   1.30   1.34   (0.27  (0.28

9/30/2016

 $12.42   0.00(9)   1.19   1.19   (0.17  (0.20

9/30/2015

 $13.45   (0.04  (0.44  (0.48  (0.14  (0.41

Class I

      

9/30/2019

 $12.14   0.17   (1.61  (1.44  (0.32  (0.13

9/30/2018

 $14.35   0.17   (1.32  (1.15  (0.58  (0.48

9/30/2017

 $13.50   0.17   1.32   1.49   (0.36  (0.28

9/30/2016

 $12.61   0.12   1.22   1.34   (0.25  (0.20

9/30/2015

 $13.58   0.08   (0.44  (0.36  (0.20  (0.41

Class R6

      

9/30/2019

 $12.15   0.18   (1.61  (1.43  (0.32  (0.13

9/30/2018

 $14.36   0.18   (1.33  (1.15  (0.58  (0.48

9/30/2017

 $13.50   0.18   1.33   1.51   (0.37  (0.28

6/27/2016(3) – 9/30/2016

 $12.38   0.04   1.13   1.17   (0.05   

 

 

(1)

Not annualized.

(2)

Annualized.

(3)

Commencement of operations.

(4)

After fees waived and expenses absorbed or recouped by the Advisor, where applicable.

(5)

Net investment income per share has been calculated based on average shares outstanding during the period.

(6)

The total return calculation does not reflect the sales loads that may be imposed on Class A or C shares (see Note 7 of the Notes to Financial Statements).

(7)

The total return figure is the since inception return for the class.

(8)

Includes expenses not covered by the Trust’s expense limitation agreement. See Note 3 for more information.

(9)

Amount is less than $0.01 per share.

 

The accompanying notes to financial statements are an integral part of these statements.

 

84


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

Net asset
value, end
of period
  Total
return(6)
  Net assets,
end of
period
(millions)
  Ratio of
net expenses
to average
net assets(4)
  Ratio of net
investment
income to
average
net assets(4)
  Ratio of
expenses (prior
to reimburse-
ments) to
average
net assets
  Ratio of net
investment
income (prior
to reimburse-
ments) to
average
net assets
  Portfolio
turnover
rate
 
       
       
$10.22   -12.04 $43.5   1.35  1.34  1.35  1.34  22.52
$12.10   -8.88 $80.9   1.30  1.05  1.30  1.05  21.97
$14.30   11.29 $176.9   1.30%(8)   1.04  1.30%(8)   1.04  21.37
$13.46   10.60 $121.1   1.32  0.71  1.31  0.72  21.00
$12.58   -2.76 $79.1   1.40  0.35  1.32  0.43  24.82
       
$9.94   -12.69 $6.9   2.10  0.59  2.10  0.59  22.52
$11.81   -9.55 $14.5   2.05  0.30  2.05  0.30  21.97
$14.03   10.52 $27.2   2.05%(8)   0.29  2.05%(8)   0.29  21.37
$13.24   9.78 $19.8   2.06  (0.03)%   2.06  (0.03)%   21.00
$12.42   -3.49 $15.1   2.07  (0.34)%   2.07  (0.34)%   24.82
       
$10.25   -11.93 $414.8   1.15  1.54  1.15  1.54  22.52
$12.14   -8.70 $963.8   1.10  1.25  1.10  1.25  21.97
$14.35   11.54 $1,543.9   1.10%(8)   1.24  1.10%(8)   1.24  21.37
$13.50   10.85 $1,212.4   1.13  0.90  1.11  0.92  21.00
$12.61   -2.58 $877.6   1.15  0.59  1.12  0.62  24.82
       
$10.27   -11.80 $20.4   1.00  1.69  1.10  1.59  22.52
$12.15   -8.64 $72.5   1.00  1.35  1.05  1.30  21.97
$14.36   11.67 $76.1   1.01%(8)   1.33  1.05%(8)   1.29  21.37
$13.50   9.49%(7)  $16.5   1.00%(2)   1.03%(2)   1.06%(2)   0.97%(2)   21.00%(1) 

 

The accompanying notes to financial statements are an integral part of these statements.

 

85


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

   Net asset
value,
beginning
of period
  Net
investment
income(5)
      
    
Net
realized and
unrealized
gain (loss) on
investments
  Total from
investment
operations
  Dividends
from net
investment
income
  Dividends
from net
realized
gains
 

Brandes Small Cap Value Fund

 

  

Class A

      

9/30/2019

 $10.27   0.05   (0.95  (0.90  (0.10  (0.69

1/2/2018(3) – 9/30/2018

 $10.00   0.02   0.27   0.29   (0.02   

Class I

      

9/30/2019

 $10.27   0.07   (0.92  (0.85  (0.11  (0.69

1/2/2018(3) – 9/30/2018

 $10.00   0.04   0.27   0.31   (0.04   

Class R6

      

9/30/2019

 $10.32   0.09   (1.63  (1.54  (0.12  (0.69

1/2/2018(3) – 9/30/2018

 $10.00   0.05   0.31   0.36   (0.04   

Brandes Core Plus Fixed Income Fund

 

   

Class A

      

9/30/2019

 $8.85   0.24   0.33   0.57   (0.24   

9/30/2018

 $9.18   0.23   (0.33  (0.10  (0.23   

9/30/2017

 $9.39   0.20   (0.18  0.02   (0.21  (0.02

9/30/2016

 $9.14   0.22   0.26   0.48   (0.22  (0.01

9/30/2015

 $9.22   0.19   (0.02  0.17   (0.20  (0.05

Class I

      

9/30/2019

 $8.92   0.26   0.34   0.60   (0.26   

9/30/2018

 $9.25   0.25   (0.33  (0.08  (0.25   

9/30/2017

 $9.44   0.22   (0.16  0.06   (0.23  (0.02

9/30/2016

 $9.20   0.24   0.25   0.49   (0.24  (0.01

9/30/2015

 $9.28   0.21   (0.02  0.19   (0.22  (0.05

Class R6

      

9/30/2019

 $8.93   0.09   0.56   0.65   (0.32   

10/10/2017(3) – 9/30/2018

 $9.25   0.06   (0.06     (0.32   

 

 

(1)

Not annualized.

(2)

Annualized.

(3)

Commencement of operations.

(4)

After fees waived and expenses absorbed or recouped by the Advisor, where applicable.

(5)

Net investment income per share has been calculated based on average shares outstanding during the period.

(6)

The total return calculation does not reflect the sales loads that may be imposed on Class A shares (see Note 7 of the Notes to Financial Statements).

(7)

The total return figure is the since inception return for the class.

(8)

Includes expenses not covered by the Trust’s expense limitation agreement. See Note 3 for more information.

(9)

Amount is less than $50,000.

 

The accompanying notes to financial statements are an integral part of these statements.

 

86


Brandes Investment Trust

FINANCIAL HIGHLIGHTS For a capital share outstanding for the period ended:

 

 

 

Net asset
value, end
of period
  Total
return(6)
  Net assets,
end of
period
(millions)
  Ratio of
net expenses
to average
net assets(4)
  Ratio of net
investment
income to
average
net assets(4)
  Ratio of
expenses (prior
to reimburse-
ments) to
average
net assets
  Ratio of net
investment
income (prior
to reimburse-
ments) to
average
net assets
  Portfolio
turnover
rate
 
       
       
$8.58   -8.53 $(9)   1.15  0.55  7.18  (5.48)%   54.30
$10.27   2.92%(7)  $0.1   1.15%(2)   0.28%(2)   3.21%(2)   (1.78)%(2)   41.02%(1) 
       
$8.62   -8.13 $0.5   0.90  0.81  4.18  (2.47)%   54.30
$10.27   3.09%(7)  $5.4   0.90%(2)   0.53%(2)   3.67%(2)   (2.24)%(2)   41.02%(1) 
       
$7.97   -15.36 $(9)   0.72  0.98  3.16  (1.46)%   54.30
$10.32   3.63%(7)  $4.8   0.72%(2)   0.71%(2)   2.99%(2)   (1.56)%(2)   41.02%(1) 
       
       
$9.18   6.56 $3.2   0.70  2.72  0.93  2.49  18.54
$8.85   -1.08 $1.8   0.70  2.57  0.87  2.40  47.73
$9.18   0.28 $3.3   0.71%(8)   2.25  0.85%(8)   2.11  35.10
$9.39   5.32 $2.0   0.70  2.38  0.93  2.15  35.88
$9.14   1.78 $2.1   0.70  2.07  1.06  1.71  11.24
       
$9.26   6.85 $83.4   0.50  2.91  0.73  2.68  18.54
$8.92   -0.85 $89.7   0.50  2.78  0.68  2.60  47.73
$9.25   0.71 $97.9   0.51%(8)   2.45  0.66%(8)   2.30  35.10
$9.44   5.43 $97.2   0.50  2.58  0.72  2.36  35.88
$9.20   2.02 $72.1   0.50  2.26  0.86  1.90  11.24
       
$9.26   7.40 $(9)   0.35  0.97  0.35  0.97  18.54
$8.93   0.04%(7)  $(9)   0.35%(2)   0.69%(2)   0.35%(2)   0.69%(2)   47.73%(1) 

 

The accompanying notes to financial statements are an integral part of these statements.

 

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Brandes Investment Trust

NOTES TO FINANCIAL STATEMENTS

 

 

 

NOTE 1 – ORGANIZATION

The Brandes International Equity Fund (the “International Fund”), the Brandes Global Equity Fund (the “Global Fund”), the Brandes Global Equity Income Fund (the “Global Income Fund”), the Brandes Emerging Markets Value Fund (the “Emerging Markets Fund”), the Brandes International Small Cap Equity Fund (the “International Small Cap Fund”), the Brandes Small Cap Value Fund (the “Small Cap Value Fund”) and the Brandes Core Plus Fixed Income Fund (the “Core Plus Fund”) (each a “Fund” and collectively the “Funds”) are series of Brandes Investment Trust (the “Trust”). The Trust is registered under the Investment Company Act of 1940 (the “1940 Act”) as a diversified, open-end management investment company.

The International Fund, Global Fund, Global Income Fund, Emerging Markets Fund, International Small Cap Fund, Small Cap Value Fund and Core Plus Fund began operations on January 2, 1997, October 6, 2008, December 31, 2014, January 31, 2011, February 1, 2012, January 2, 2018 and December 28, 2007, respectively. Prior to January 31, 2011 for the Emerging Markets Fund, February 1, 2012 for the International Small Cap and January 2, 2018 for the Small Cap Value Fund, these Funds’ portfolios were managed as private investment funds with investment objectives, investment policies and strategies that were, in all material respects, equivalent to those of the Emerging Markets Fund, International Small Cap Fund and Small Cap Value Fund, respectively.

The International Fund has four classes of shares: Class A, Class C, Class I and Class R6. The Global Fund and the Global Income Fund have three classes of shares: Class A, Class C and Class I. The Emerging Markets Fund and International Small Cap Fund have four classes of shares: Class A, Class C, Class I and Class R6. The Small Cap Value Fund and Core Plus Fund have three classes of shares: Class A, Class I and Class R6.

The International Fund and Global Fund invest their assets primarily in equity securities of issuers with market capitalizations greater than $1 billion. The International, International Small Cap and Emerging Markets Funds invest their assets in securities of foreign companies, while the Global Fund, and Global Income Fund invest their assets in securities of foreign and domestic companies. The Small Cap Value Fund invests primarily in U.S. equity securities of issuers with market capitalizations less than $5 billion. The Core Plus Fund invests predominantly in debt securities issued by U.S. and foreign companies and debt obligations issued or guaranteed by the U.S. Government and foreign governments and their agencies and instrumentalities.

 

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Brandes Investment Trust

NOTES TO FINANCIAL STATEMENTS — (continued)

 

 

 

NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES

Each Fund is an investment company that applies the accounting and reporting guidance issued in Topic 946, “Financial Services-Investment Companies”, by the Financial Accounting Standards Board (“FASB”). The following is a summary of significant accounting policies consistently followed by the Funds. These policies are in conformity with generally accepted accounting principles (“GAAP”) in the United States of America.

 

 A.

Repurchase Agreements.  Each Fund may enter into repurchase agreements with government securities dealers recognized by the Federal Reserve Board, with member banks of the Federal Reserve System or with other brokers or dealers that meet the credit guidelines established by the Board of Trustees. Each Fund will always receive and maintain, as collateral, U.S. Government securities whose market value, including accrued interest (which is recorded in the Schedules of Investments), will be at least equal to 100% of the dollar amount invested by the Fund in each agreement, and the Fund will make payment for such securities only upon physical delivery or upon evidence of book entry transfer to the account of the Fund’s custodian. If the term of any repurchase transaction exceeds one business day, the value of the collateral is marked-to-market on a daily basis to ensure the adequacy of the collateral. Before causing a Fund to enter into a repurchase agreement with any other party, the investment advisor will determine that such party does not have any apparent risk of becoming involved in bankruptcy proceedings within the time frame contemplated by the repurchase agreement. If the seller defaults and the value of the collateral declines, or if bankruptcy proceedings are commenced with respect to the seller of the security, realization of the collateral by the Fund may be delayed or limited. At September 30, 2019, the Funds did not invest in repurchase agreements.

 

 B.

Foreign Currency Translation and Transactions.  Values of investments denominated in foreign currencies are converted into U.S. dollars using the spot market rates of exchange at the time of valuation. Purchases and sales of investments and dividend and interest income are translated into U.S. dollars using the spot market rates of exchange prevailing on the respective dates of such translations. The gain or loss resulting from changes in foreign exchange rates is included with net realized and unrealized gain or loss from investments, as appropriate. Foreign securities and currency transactions may involve certain considerations and risks not typically associated with those of domestic origin.

Foreign securities are recorded in the financial statements after translation to U.S. dollars based on the applicable exchange rate at the end of the period. The Funds report certain foreign currency-related transactions as

 

89


Brandes Investment Trust

NOTES TO FINANCIAL STATEMENTS — (continued)

 

 

 

components of realized gains or losses for financial reporting purposes, whereas such components are treated as ordinary income for federal income tax purposes.

 

 C.

Delayed Delivery Securities.  The Funds may purchase securities on a when issued or delayed delivery basis. “When-issued” or delayed delivery refers to securities whose terms are available and for which a market exists, but that have not been issued. For a when-issued or delayed delivery transaction, no payment is made until delivery date, which is typically longer than the normal course of settlement. When a Fund enters into an agreement to purchase securities on a when-issued or delayed delivery basis, the Fund segregates cash or liquid securities, of any type or maturity, equal in value to the Fund’s commitment. Losses may arise if the market value of the underlying securities change, if the counterparty does not perform under the contract, or if the issuer does not issue the securities due to political, economic, or other factors. The Funds did not have any open commitments on delayed delivery securities as of September 30, 2019.

 

 D.

Participatory Notes.  The International, Global, Global Income, Emerging Markets, International Small Cap and Small Cap Value Funds may invest in participatory notes. Participatory notes are derivative securities which are designed to provide synthetic exposure to one or more underlying securities, subject to the credit risk of the issuing financial institution.

Investments in participatory notes involve risks normally associated with a direct investment in the underlying securities. In addition, participatory notes are subject to counterparty risk, which is the risk that the broker-dealer or bank that issues the notes will not fulfill its contractual obligation to complete the transaction with the Trust. Participatory notes constitute general unsecured, unsubordinated contractual obligations of the banks or broker-dealers that issue them and generally are issued as an actual note from the financial intermediary or an equity linked warrant (commonly known as a low exercise price option). The Trust is relying on the creditworthiness of such banks or broker-dealers and has no rights under a participatory note against the issuer of the securities underlying such participatory note. The investment advisor has established guidelines for monitoring participatory note exposure for the Funds. Prior to investment in a participatory note, the investment advisor will complete an analysis of the prospective counterparties and once purchased, will continue to monitor creditworthiness on a quarterly basis. The investment advisor requires a minimum credit rating for such counterparties (as determined by rating agencies such as Moody’s, Fitch and S&P) of A.

 

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Brandes Investment Trust

NOTES TO FINANCIAL STATEMENTS — (continued)

 

 

 

The Funds record counterparty credit risk valuation adjustments, if material, on the participatory notes in order to appropriately reflect the credit quality of the counterparty.

The International, Global, Global Income, International Small Cap and Small Cap Value Funds did not invest in any participatory notes at September 30, 2019. The Emerging Markets Fund invested in one participatory note with HSBC Bank Plc in which HSBC Bank Plc is an investment vehicle used to gain exposure to the underlying security of China South Publishing & Media Group Co. Ltd. China South Publishing & Media Group Co. Ltd. was held from the beginning of the fiscal year through the end of the year. The average monthly market value of this security was $14,447,582 during the year. There was no realized gain or loss in participatory notes recognized in the Emerging Markets Fund for the year ended September 30, 2019. The market value of China South Publishing & Media Group Co. Ltd. on September 30, 2019 was $13,443,815 and can be found in the Emerging Market Fund’s Schedule of Investments.

 

 E.

Investment Transactions, Dividends and Distributions.  Investment transactions are accounted for on the trade dates. Realized gains and losses are evaluated on the basis of identified costs. Dividend income and distributions to shareholders are recorded on the ex-dividend dates. Interest is recorded on an accrual basis. Withholding taxes on foreign dividends and capital gains, which are included as a component of net investment income and realized gain (loss) on investments, respectively, have been provided for in accordance with the Trust’s understanding of the applicable country’s tax rules and rates. Each Fund’s investment income, expenses, other than class specific expenses, and realized and unrealized gains and losses are allocated daily to each class of the Fund’s shares based upon the relative net asset values of outstanding shares of each class of shares at the beginning of the day (after adjusting for the current capital shares activity of the respective class). Expenses common to the Funds’ portfolios are allocated among the Funds based upon their relative net asset values or other appropriate allocation methods. The Funds amortize premiums and accrete discounts using the constant yield method.

 

 F.

Concentration of Risk.  As of September 30, 2019, the International, Global, Global Income, Emerging Markets and International Small Cap Funds held significant portions of their assets in foreign securities. Certain price and foreign exchange fluctuations as well as economic and political situations in the foreign jurisdictions could have an impact on the International, Global, Global Income, Emerging Markets and International Small Cap Funds’ net assets. The investment advisor monitors these off-balance sheet risks.

 

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Brandes Investment Trust

NOTES TO FINANCIAL STATEMENTS — (continued)

 

 

 

 

 G.

Use of Estimates.  The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates and assumptions.

 

 H.

Securities Lending.  The Funds may lend their portfolio securities to banks, brokers and dealers. Lending Fund securities exposes the Fund to risks such as the following: (i) the borrower may fail to return the loaned securities, (ii) the borrower may not be able to provide additional collateral, or (iii) the Funds may experience delays in recovery of the loaned securities or loss of rights in the collateral if the borrower fails financially.

To minimize these risks, the borrower must agree to maintain collateral with the Fund’s custodian, marked to market daily, in the form of U.S. Government obligations, in an amount at least equal to 102% (105% in the case of loans of foreign securities not denominated in U.S. dollars) of the market value of the loaned securities. As of September 30, 2019, the International Fund, Global Fund, Global Income Fund, Emerging Markets Fund, International Small Cap Fund, Small Cap Value Fund and Core Plus Fund did not have any securities on loan. Non-cash collateral received by the Fund may not be sold or re-pledged except to satisfy a borrower default. Therefore, non-cash collateral is not included on the Fund’s Schedules of Investments or Statements of Assets and Liabilities.

 

 I.

Indemnification Obligations.  Under the Trust’s organizational documents, its current and former officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. The Trust has indemnified its trustees against any expenses actually and reasonably incurred by the trustees in any proceeding arising out of or in connection with the trustees’ service to the Trust. In addition, in the normal course of business, the Trust enters into contracts that contain a variety of representations and warranties and provide general indemnifications. The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds that have not yet occurred or that would be covered by other parties.

 

 J.

Accounting for Uncertainty in Income Taxes.  Each Fund has elected to be taxed as a “regulated investment company” and intends to distribute substantially all its taxable income to its shareholders and otherwise comply with the provisions of the Internal Revenue Code applicable to regulated investment companies. The Funds may be subject to a nondeductible excise tax calculated as a percentage of certain undistributed amounts of net investment income and net capital gains. The Funds intend to distribute

 

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Brandes Investment Trust

NOTES TO FINANCIAL STATEMENTS — (continued)

 

 

 

 their net investment income and capital gains as necessary to avoid this excise tax. Therefore, no provision for federal income taxes or excise taxes has been made.

The Trust analyzes all open tax years, as defined by the applicable statute of limitations, for all major jurisdictions. Open tax years for the Funds are those that are open for exam by taxing authorities (2016 through 2019). As of September 30, 2019, the Trust has no examinations in progress.

Management has analyzed the Trust’s tax positions, and has concluded that no liability should be recorded related to uncertain tax positions expected to be taken on the tax return for the fiscal year-ended September 30, 2019.

The Trust identifies its major tax jurisdictions as the U.S. Government and the State of California. The Funds are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.

 

 K.

Fair Value Measurements.  The Trust has adopted GAAP accounting principles related to fair value accounting standards which establish a definition of fair value and set out a hierarchy for measuring fair value. These standards require additional disclosures about the various inputs and valuation techniques used to develop the measurements of fair value and a discussion of changes in valuation techniques and related inputs during the period. These inputs are summarized in the three broad levels listed below:

Level 1 — Fair value measurement within Level 1 should be based on an unadjusted quoted price in an active market that the Funds have the ability to access for the asset or liability at the measurement date. Because a quoted price alone forms the basis for the measurement, the access requirement within Level 1 limits discretion in pricing the asset or liability, including in situations in which there are multiple markets for the asset or liability with different prices and no single market represents a principal market for the asset or liability. Importantly, the Financial Accounting Standards Board has indicated that when a quoted price in an active market for a security is available, that price should be used to measure fair value without regard to an entity’s intent to transact at that price.

Level 2 — Fair value measurement within Level 2 should be based on all inputs other than unadjusted quoted prices included within Level 1 that are observable for the asset or liability. Other significant observable market inputs include quoted prices for similar instruments in active markets, quoted adjusted prices in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which the majority of significant inputs and significant value drivers are observable in active markets.

 

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Brandes Investment Trust

NOTES TO FINANCIAL STATEMENTS — (continued)

 

 

 

Level 3 — Fair value measurement within Level 3 should be based on unobservable inputs in such cases where markets do not exist or are illiquid. Significant unobservable inputs include model derived valuations in which the majority of significant inputs or significant value drivers are unobservable. Unobservable inputs are those inputs that reflect the Fund’s own assumptions that market participants would use to price the asset or liability based on the best available information.

 

 L.

Security Valuation.  Common and preferred stocks, exchange-traded funds and financial derivative instruments, such as futures contracts and options contracts that are traded on a national securities or commodities exchange, are valued at the last reported sales price at the close of regular trading on each day the exchange is open for trading, in the case of common stocks and exchange-traded funds, or, in the case of futures contracts or options contracts, the settlement price determined by the relevant exchange. Securities listed on the NASDAQ National Market System for which market quotations are readily available are valued using the NASDAQ Official Closing Price. To the extent these securities are actively traded and valuation adjustments are not applied, they are categorized as Level 1 of the fair value hierarchy.

Equity securities traded on an exchange for which there have been no sales on the valuation date are generally valued at the mean between last bid and ask price on such day and are categorized as Level 2 of the fair value hierarchy, or are fair valued by the Valuation Committee.

Investments in registered open-end management investment companies are valued based upon the Net Asset Values (“NAVs”) of such investments and are categorized as Level 1 of the fair value hierarchy.

Valuation adjustments may be applied to certain common and preferred stocks that are solely traded on a foreign exchange to account for the market movement between the close of the foreign market and the close of the New York Stock Exchange (“NYSE”). These securities are generally valued using pricing service providers that consider the correlation of the trading patterns of the foreign securities to the intraday trading in the U.S. markets for investments. Securities using these valuation adjustments are categorized as Level 2 of the fair value hierarchy. As of September 30, 2019, the International Fund, Global Fund, Global Income Fund, Emerging Markets Fund and International Small Cap Fund had securities with market values of$589,480,347, $20,472,971, $795,263, $710,108,576, and $228,370,749 that represent 83.81%, 56.76%, 56.52%, 50.04%, and 47.03% of each Fund’s net assets, respectively, that were fair valued using these valuation adjustments.

 

94


Brandes Investment Trust

NOTES TO FINANCIAL STATEMENTS — (continued)

 

 

 

Fixed income securities (other than repurchase agreements and demand notes) including corporate, convertible and municipal bonds and notes, U.S. government agencies, U.S. Treasury obligations, sovereign issues, bank loans, convertible preferred securities, fixed income securities purchased on a delayed delivery basis and non-U.S. bonds are normally valued on the basis of quotes obtained from brokers and dealers or independent pricing services or sources. Independent pricing services typically use information provided by market makers or estimates of market values obtained from yield data relating to investments or securities with similar characteristics. The service providers’ internal models use inputs that are observable such as, among other things, issuer details, interest rates, yield curves, prepayment speeds, credit risks/spreads, default rates and quoted prices for similar assets. Securities that use similar valuation techniques and inputs as described above are categorized as Level 2 of the fair value hierarchy.

Rights that are traded on a national securities exchange are valued at the last reported sales price at the close of regular trading on each day the exchange is open. A right is a privilege offered by a corporation to its shareholders pro rata to subscribe to a certain security at a specified price, often for a short period. Rights may or may not be transferable.

Mortgage and asset-backed securities are usually issued as separate tranches, or classes, of securities within each package of underlying securities. These securities are also normally valued by pricing service providers that use broker-dealer quotations or valuation estimates from their internal pricing models. The pricing models for these securities usually consider tranche level attributes, estimated cash flows and market-based yield spreads for each tranche, and current market data and incorporate packaged collateral performance, as available. Mortgage and asset-backed securities that use such valuation techniques and inputs are categorized as Level 2 of the fair value hierarchy.

Repurchase agreements and demand notes, for which neither vendor pricing nor market maker prices are available, are valued at amortized cost on the day of valuation, unless Brandes Investment Partners, L.P. (the “Advisor”) determines that the use of amortized cost valuation on such day is not appropriate (in which case such instrument is fair valued in accordance with the fair value procedures of the Trust).

Certain securities may be fair valued in accordance with the fair valuation procedures approved by the Board of Trustees. The Valuation Committee is generally responsible for overseeing the day-to-day valuation processes and reports periodically to the Board. The Valuation Committee is authorized to make all necessary determinations of the fair value of

 

95


Brandes Investment Trust

NOTES TO FINANCIAL STATEMENTS — (continued)

 

 

 

portfolio securities and other assets for which market quotations are not readily available or if it is deemed that the prices obtained from brokers and dealers or independent pricing services are unreliable. The securities fair valued by the Valuation Committee are indicated in the Schedules of Investments and are categorized as Level 2 or Level 3 of the fair value hierarchy. Certain vendor priced securities may also be considered Level 3 if significant unobservable inputs are used by the vendors.

In using fair value pricing, each Fund attempts to establish the price that it might reasonably have expected to receive upon a sale of the security at 4:00 p.m. Eastern time. Valuing securities at fair value involves greater reliance on judgment than valuation of securities based on readily available market quotations. A Fund using fair value to price securities may value those securities higher or lower than another fund using market quotations or fair value to price the same securities. Further, there can be no assurance that the Fund could obtain the fair value assigned to a security if it were to sell the security at approximately the time at which the Fund determines its net asset value.

The following is a summary of the level inputs used, as of September 30, 2019, involving the Funds’ assets carried at fair value. The inputs used for valuing securities may not be an indication of the risk associated with investing in those securities.

 

Description

  Level 1   Level 2   Level 3   Total 

Investments in Securities

        

International Fund

        

Common Stocks

        

Communication Services

  $   $62,169,473   $   $62,169,473 

Consumer Discretionary

       90,372,523        90,372,523 

Consumer Staples

       64,075,182        64,075,182 

Energy

       46,298,720        46,298,720 

Financials

       132,722,611        132,722,611 

Health Care

       87,440,217        87,440,217 

Industrials

   16,041,017    47,248,345        63,289,362 

Information Technology

   7,277,213    20,948,542        28,225,755 

Materials

   10,272,803    27,903,063        38,175,866 

Real Estate

   20,490,653            20,490,653 

Utilities

       19,917,406        19,917,406 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Common Stocks

   54,081,686    599,096,082        653,177,768 
  

 

 

   

 

 

   

 

 

   

 

 

 

Preferred Stocks

        

Communication Services

   5,102,921            5,102,921 

Energy

   6,808,393    11,025,123        17,833,516 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Preferred Stocks

   11,911,314    11,025,123        22,936,437 
  

 

 

   

 

 

   

 

 

   

 

 

 

Short-Term Investments

   26,029,138          26,029,138 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Investments in Securities

  $92,022,138   $610,121,205   $   $702,143,343 
  

 

 

   

 

 

   

 

 

   

 

 

 

 

96


Brandes Investment Trust

NOTES TO FINANCIAL STATEMENTS — (continued)

 

 

 

Description

  Level 1   Level 2   Level 3   Total 

Global Fund

        

Common Stocks

        

Communication Services

  $   $1,506,180   $   $1,506,180 

Consumer Discretionary

       4,154,679        4,154,679 

Consumer Staples

   190,706    2,821,028        3,011,734 

Energy

   453,248    2,860,484        3,313,732 

Financials

   5,692,879    2,765,337        8,458,216 

Health Care

   4,998,555    2,805,114        7,803,669 

Industrials

   1,240,167    1,008,648        2,248,815 

Information Technology

   804,302    1,138,799        1,943,101 

Materials

       496,519        496,519 

Real Estate

   801,424            801,424 

Utilities

       1,074,182        1,074,182 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Common Stocks

   14,181,281    20,630,970        34,812,251 
  

 

 

   

 

 

   

 

 

   

 

 

 

Preferred Stocks

        

Information Technology

       129,131        129,131 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Preferred Stocks

       129,131        129,131 
  

 

 

   

 

 

   

 

 

   

 

 

 

Short-Term Investments

   1,288,678            1,288,678 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Investments in Securities

  $15,469,959   $20,760,101   $   $36,230,060 
  

 

 

   

 

 

   

 

 

   

 

 

 

Global Equity Income

        

Common Stocks

        

Communication Services

  $43,127   $65,683   $    108,810 

Consumer Discretionary

       116,706        116,706 

Consumer Staples

   16,178    123,656        139,834 

Energy

       126,038        126,038 

Financials

   135,296    93,631        228,927 

Health Care

   160,965    103,844        264,809 

Industrials

   20,392    46,170        66,562 

Information Technology

   17,935    22,822        40,757 

Real Estate

   50,697            50,697 

Utilities

       69,381        69,381 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Common Stocks

   444,590    767,931        1,212,521 
  

 

 

   

 

 

   

 

 

   

 

 

 

Preferred Stocks

        

Financials

   111,990            111,990 

Information Technology

       27,332        27,332 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Preferred Stocks

   111,990    27,332        139,322 
  

 

 

   

 

 

   

 

 

   

 

 

 

Short-Term Investments

   96,343            96,343 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Investments in Securities

  $652,923   $795,263   $   $1,448,186 
  

 

 

   

 

 

   

 

 

   

 

 

 

 

97


Brandes Investment Trust

NOTES TO FINANCIAL STATEMENTS — (continued)

 

 

 

Description

  Level 1   Level 2   Level 3   Total 

Emerging Markets Fund

        

Common Stocks

        

Communication Services

  $51,161,656   $135,459,353   $   $186,621,009 

Consumer Discretionary

   67,022,743    156,545,807        223,568,550 

Consumer Staples

   30,927,689    52,456,892        83,384,581 

Energy

   24,282,323    13,952,298        38,234,621 

Financials

   28,726,151    205,099,613        233,825,764 

Health Care

   18,020,786    35,714,425        53,735,211 

Industrials

   83,724,857    16,595,130        100,319,987 

Information Technology

   30,517,973    78,736,266        109,254,239 

Materials

   39,488,713    30,019,529        69,508,242 

Real Estate

   107,355,403    13,462,094        120,817,497 

Utilities

   23,904,426            23,904,426 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Common Stocks

   505,132,720    738,041,407        1,243,174,127 
  

 

 

   

 

 

   

 

 

   

 

 

 

Participatory Note

        

Communication Services

       13,443,815        13,443,815 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Participatory Note

       13,443,815        13,443,815 
  

 

 

   

 

 

   

 

 

   

 

 

 

Preferred Stocks

        

Communication Services

   17,734,930            17,734,930 

Consumer Discretionary

       26,414,322        26,414,322 

Consumer Staples

   22,476,084            22,476,084 

Energy

   30,868,486    18,530,338        49,398,824 

Financials

   7,506,793            7,506,793 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Preferred Stocks

   78,586,293    44,944,660        123,530,953 
  

 

 

   

 

 

   

 

 

   

 

 

 

Short-Term Investments

   42,839,683            42,839,683 
  

 

 

   

 

 

   

 

 

   

 

 

 

Total Investments in Securities

  $626,558,696   $796,429,882   $   $1,422,988,578 
  

 

 

   

 

 

   

 

 

   

 

 

 

International Small Cap Fund

 

Common Stocks

        

Communication Services

  $12,440,145   $33,270,331   $    45,710,476 

Consumer Discretionary

   19,206,832    23,835,792        43,042,624 

Consumer Staples

   34,182,452    73,595,327        107,777,779 

Financials

   7,192,344    52,353,259        59,545,603 

Health Care

   13,616,981    11,247,404        24,864,385 

Industrials

   63,944,925    27,211,585        91,156,510 

Information Technology

   24,791,598    5,931,898        30,723,496 

Materials

   2,498,020