Delaware International Value Equity Fund


Delaware International Value Equity Fund seeks long-term growth without undue risk to principal.


The Fund invests primarily in equity securities that are organized, have a majority of their assets, or generate the majority of their operating income outside the United States, and that provide the potential for capital appreciation.

Fund information
Inception date10/31/1991
Dividends paid (if any)Annually
Capital gains paid (if any)December
Fund identifiers
Investment minimums
Initial investment$1,000
Subsequent Investments$100
Systematic withdrawal balance$5,000
Account features
Payroll DeductionYes

The performance quoted represents past performance and does not guarantee future results. Investment return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted.

Total returns may reflect waivers and/or expense reimbursements by the manager and/or distributor for some or all of the periods shown. Performance would have been lower without such waivers and reimbursements.

Average annual total return as of month-end (08/31/2014)
YTD1 year3 year5 year10 yearLifetimeInception date
NAV (view definition)1.61%12.72%8.94%7.92%5.88%6.71%10/31/1991
Max offer price-4.23%6.25%6.82%6.64%5.26%6.43%
MSCI EAFE Index (Gross)2.94%16.92%11.87%8.69%7.50%n/a
MSCI EAFE Index (Net)2.56%16.44%11.36%8.21%7.01%n/a
Average annual total return as of quarter-end (06/30/2014)
QTDYTD1 year3 year5 year10 yearLifetimeInception date
NAV (view definition)5.58%4.98%23.60%4.78%11.84%6.16%6.91%10/31/1991
Max offer price-0.47%-1.06%16.46%2.73%10.52%5.53%6.63%
MSCI EAFE Index (Gross)4.34%5.14%24.09%8.59%12.26%7.42%n/a
MSCI EAFE Index (Net)4.09%4.78%23.57%8.10%11.77%6.93%n/a

Returns for less than one year are not annualized.

Class A shares have a maximum up-front sales charge of 5.75% and are subject to an annual distribution fee.

Expense ratio

Net expense ratio reflects a contractual waiver of certain fees and/or expense reimbursements from March 28, 2014 to March 30, 2015. Please see the fee table in the Fund’s prospectus for more information.

Quarterly total returns @ NAV
Year1st quarter2nd quarter3rd quarter4th quarterAnnual return
Portfolio characteristics - as of 08/31/2014
Share assets$85.8 million
Number of holdings45
Market cap (median)$23.78 billion
Market cap (weighted average)$49.63 billion
Portfolio turnover (last fiscal year)30%
Beta (relative to MSCI EAFE Index (Gross)) (view definition)0.95
Annualized standard deviation, 3 years (view definition)15.04
Portfolio composition as of 08/31/2014Total may not equal 100% due to rounding.
International equities & depository receipts98.3%
Cash and cash equivalents1.7%
Top 10 holdings as of 08/31/2014
Holdings are as of the date indicated and subject to change.
List excludes cash and cash equivalents.
Holding% of portfolio
CGI Group Inc.4.2%
Teva Pharmaceutical Industries Ltd.4.1%
Nippon Telegraph & Telephone Corp.3.8%
Novartis AG3.8%
AXA S.A.3.4%
Nordea Bank AB3.4%
Mitsubishi UFJ Financial Group Inc.3.2%
Toyota Motor Corp.2.9%
Total % Portfolio in Top 10 holdings35.5%

Holdings are as of the date indicated and subject to change.

Top 10 countries as of 08/31/2014List excludes cash and cash equivalents.
Country% of portfolio
United Kingdom10.0%
Distribution history - annual distributions (Class A)1,2
Distributions ($ per share)
YearCapital gains3Net investment

1If a Fund makes a distribution from any source other than net income, it is required to provide shareholders with a notice disclosing the source of such distribution (each a "Notice"). The amounts and sources of distributions reported above and in each Notice are only estimates and are not provided for tax reporting purposes. Each Fund will send each shareholder a Form 1099 DIV for the calendar year that will provide definitive information on how to report the Fund's distributions for federal income tax purposes. The information in the table above will not be updated to reflect any subsequent recharacterization of dividends and distributions. Click here to see recent Notices pertaining to the Fund (if any).

2Information on return of capital distributions is only provided from June 1, 2014 onward.

3Includes both short- and long-term capital gains.

Ned Gray

Ned Gray, CFA

Senior Vice President, Chief Investment Officer — Global and International Value Equity

Start date on the Fund: May 2006

Years of industry experience: 28

(View bio)

Todd Bassion

Todd A. Bassion, CFA

Vice President, Portfolio Manager

Start date on the Fund: May 2006

Years of industry experience: 14

(View bio)

You may qualify for sales-charge discounts if you and your family invest, or agree to invest in the future, at least $50,000 in Delaware Investments® Funds. More information about these and other discounts is available from your financial advisor, in the Fund's prospectus under the section entitled "About your account," and in the Fund's statement of additional information (SAI) under the section entitled "Purchasing Shares."

The table below describes the fees and expenses that you may pay if you buy and hold shares of the Fund.

Shareholder fees
Maximum sales charge (load) imposed on purchases as a percentage of offering price5.75%
Maximum contingent deferred sales charge (load) as a percentage of original purchase price or redemption price, whichever is lowernone
Annual fund operating expenses
Management fees0.85%
Distribution and service (12b-1) fees0.25%
Other expenses0.37%
Total annual fund operating expenses1.47%
Fee waivers and expense reimbursements(0.01%)
Total annual fund operating expenses after fee waivers and expense reimbursements1.46%

1The Fund's investment manager, Delaware Management Company (Manager), has contractually agreed to waive all or a portion of its investment advisory fees and/or pay/reimburse expenses (excluding any 12b-1 fees, taxes, interest, short sale and dividend interest expenses, brokerage fees, certain insurance costs, acquired fund fees and expenses, and nonroutine expenses or costs, including, but not limited to, those relating to reorganizations, litigation, conducting shareholder meetings, and liquidations) in order to prevent total annual fund operating expenses from exceeding 1.21% of the Fund’s average daily net assets from March 28, 2014 through March 30, 2015. These waivers and reimbursements may only be terminated by agreement of the Manager or the Distributor, as applicable, and the Fund.

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Delaware International Value Equity Fund Quarterly commentary June 30, 2014 Class A (DEGIX)

Within the Fund

For the second quarter of 2014, Delaware International Value Equity Fund (Class A shares at net asset value) posted a return that led its benchmark, the MSCI EAFE Index.

The primary source of outperformance was strong stock selection, which was positive in four of the five regions included in the benchmark — particularly Japan, Europe ex–euro zone, the euro zone, and Asia Pacific — offsetting adverse stock selection in the United Kingdom. Overall regional allocation was also positive, largely due to positioning in emerging markets as well as Canada.

Stock selection was strong in 7 out of 10 sectors, especially in consumer discretionary, information technology, and telecommunication services, which more than offset adverse stock selection in financials. Overall sector allocation was slightly positive, primarily due to favorable relative exposure to financials and energy that offset an adverse underweight exposure to utilities.

Net currency effect was negative, with an adverse underweight exposure to the British pound and Australian dollar more than offsetting the positive effect from exposure to the Canadian dollar.

General outlook

Our view of market prospects is defined by three types of analysis: first, by an understanding of company managements’ ability to exploit market demand; second, by the constraints on that demand created by the macroeconomic cycles of the markets within which those companies operate, and finally, by a view on the market’s confidence that this pattern can be sustained — largely a question of valuation.

Aggregating the second and third sets of issues, the euro zone displays attractive prospects assuming the current recovery endures. Cyclical recovery there is still in a relatively early phase, while low cyclically adjusted earnings valuations suggest the market implicitly expects either a weak and short-lived cycle or a lack of confidence in companies’ ability to achieve past levels of profitability. In either case, there appears to be a significant amount of negative sentiment already discounted into today’s stock prices.

Japan offers a more complex picture in that the change being sought by the government has more of a secular than a cyclical objective. The market appears inexpensive on the net book value of corporate assets, yet the historical returns on those assets, if they are a guide to the future, have been so far below global norms as to undermine confidence in a revaluation. Should Japan succeed in at least some of its structural reforms, it may, in the process, build not just a strong base of corporate fundamentals, but a source of confidence for expansion of valuations as well.

The scale of the U.S. economy and its accompanying markets makes it a key element in determining prospects elsewhere. Unlike other regions, the U.S. economy has grown unabated since the end of the global financial crisis in 2009, making it appear cyclically extended, at least chronologically. Against this concern, however, optimists can point out the solid leading indicators, low credit spreads, ample slack in the labor markets, and very low inflation. Valuations appear well above historical median levels, but are still well below prior peaks and may reflect the greater stability and secular growth prospects this country enjoys versus many other developed markets.

Providing as they do the common ground for all market participants, macro-level issues receive intensive attention from a multitude of analysts, strategists, and commentators. Broad cycles encompass an enormously complex array of contributing factors that can derail expectations. The analysis above provides merely a brief overview of some of these salient factors. We believe they remain generally supportive of market prospects.  As bottom-up stock pickers focused on individual company strengths and valuations, however, we do not rely on these macro measures as the key determinants of our decisions, important as they may be. As global equity managers taking a contrarian approach to bottom-up stock selection, we aim to use the uncertainty of macroeconomic and valuation cycles to bring to light opportunities at the company level, because it is there that analytical differentiation has the potential to pay the most handsome and consistent rewards.


The views expressed represent the Manager's assessment of the Fund and market environment as of the date indicated, and should not be considered a recommendation to buy, hold, or sell any security, and should not be relied on as research or investment advice. Information is as of the date indicated and subject to change.

Document must be used in its entirety.

Carefully consider the Fund’s investment objectives, risk factors, charges, and expenses before investing. This and other information can be found in the Fund’s prospectus and its summary prospectus, which may be obtained by clicking the prospectus link located in the right-hand sidebar or calling 800 523-1918. Investors should read the prospectus and the summary prospectus carefully before investing.

Investing involves risk, including the possible loss of principal.

International investments entail risks not ordinarily associated with U.S. investments including fluctuation in currency values, differences in accounting principles, or economic or political instability in other nations.

Investing in emerging markets can be riskier than investing in established foreign markets due to increased volatility and lower trading volume.

Not FDIC Insured | No Bank Guarantee | May Lose Value

Fund Finder

Daily pricing (as of 09/18/2014)

Class APriceNet changeYTD
Max offer price$15.25n/an/a

Total net assets (as of 08/31/2014)

$313.2 million all share classes

Lipper ranking (as of 08/31/2014)

YTD ranking117 / 159
1 year143 / 159
3 years100 / 121
5 years44 / 102
10 years40 / 63
Lipper classificationInternational Multi-Cap Value

(View Lipper disclosure)

Benchmark, peer group

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

Lipper International Multi-Cap Core Funds Average (view)

Additional information