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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Artisan International Fund 2024 Q3 Investor Letter | Buyside Digest

Back to Fund Profile (Artisan International Fund)

Primary Source Intelligence • Q3 2024 Letter Analysis

Artisan International Fund Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, Artisan International Fund. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

Annualized+9.02%

Digest Analysis

Quick Take

"Artisan International Fund lagged benchmarks in Q3 due to currency headwinds and late-quarter weakness in large holdings. Healthcare led performance with biotech approvals driving UCB and Argenx higher."

Executive Summary

Artisan International Fund underperformed its benchmarks in Q3 2024, with the portfolio returning 5.89% versus 7.26% for the MSCI EAFE Index, primarily due to negative currency effects and weakness in several large holdings in the final days of the quarter. Healthcare was the standout sector, led by biotech companies UCB and Argenx, which benefited from FDA approvals and strong revenue growth. The fund added exposure to the energy transition theme through purchases of National Grid and Engie, both investing heavily in grid modernization and renewable energy infrastructure. In Japan, the team added Japan Post Bank to capitalize on rising interest rates, while Sumitomo Mitsui Financial Group reported strong earnings growth. Industrial gases companies Air Liquide and Nippon Sanso demonstrated pricing power despite volume softness. The aerospace sector faced supply chain challenges, leading to position reductions in AerCap and an exit from Airbus. Looking forward, the managers remain optimistic about opportunities in high-quality growth companies as inflation and interest rates decline.

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Institutional Meta Strategy

Meta Strategy Gauges

Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.

Signal Matrix

Market Conviction

68%

CautiousHigh

Moderate (68%)

The letter demonstrates moderate-to-high conviction through specific position sizing discussions and clear thesis explanations for individual holdings. The manager provides detailed rationales for new positions like National Grid (£60 billion investment program) and Japan Post Bank (specific net interest income projections), along with peak sales projections for biotech holdings. However, the diversified portfolio structure and some hedged language around market conditions prevent a higher score.

Growth Outlook

25%

BearishBullish

Bearish (25%)

The manager expresses cautious optimism about the market outlook. While acknowledging recession worries and volatility in Q3, they state that declining inflation and interest rates should create a supportive backdrop for growth stocks. They remain optimistic about finding opportunities in the final months of the year, but this is balanced against economic slowdown concerns.

Risk Appetite

15%

DefensiveAggressive

Defensive (15%)

The portfolio positioning shows selective risk-taking with some defensive characteristics. The fund lacks energy sector exposure (defensive given sector decline) and maintains below-benchmark weights in IT and consumer staples. New positions were added selectively in energy transition and Japanese banks, but overall positioning appears measured rather than aggressive.

Capital Deployment

25%

De-riskingDeploying

De-risking (25%)

The fund showed moderate deployment activity with several new position initiations (National Grid, Engie, Japan Post Bank, Accor, Pernod Ricard, Heineken) while also trimming or exiting other positions (AerCap, Airbus, Deutsche Bank, Daiichi Sankyo, Temenos, ASML). This represents capital rotation and selective deployment rather than aggressive net deployment, as no cash level changes were disclosed.

Forward Guidance

30%

CautiousExpansionary

Cautious (30%)

The manager indicates a constructive deployment bias, stating they remain optimistic about finding opportunities in the final months of the year to uncover high-quality companies. They added new positions in National Grid, Engie, Japan Post Bank, Accor, Pernod Ricard, and Heineken, showing willingness to deploy capital selectively.

Language Signal

20%

BearishBullish

Bearish (20%)

The language is balanced between opportunity and risk recognition. Positive terms include 'optimistic,' 'ample opportunities,' 'supportive backdrop,' and 'attractive valuations.' Risk language includes 'recession worries,' 'volatility,' 'headwinds,' and 'uncertainty.' The net balance slightly favors constructive language but remains measured.

Perceived Risk

55%

Low RiskElevated

Moderate Risk (55%)

The manager identifies several meaningful risks including recession worries from US employment data, yen carry trade unwinding in Japan, UK inflation concerns, China economic slowdown, and aerospace supply chain constraints. These risks are discussed with specific context and implications, indicating moderate risk awareness without being alarmist.

Opportunity Density

65%

ScarceAbundant

Abundant (65%)

The manager expresses confidence in finding opportunities, stating they 'remain optimistic that the final months of the year will offer ample opportunities' to find high-quality companies at compelling valuations. The addition of multiple new positions across different themes suggests they see selective opportunities in the current environment.

Time Horizon

70%

Short-TermLong-Term

Decade+ (70%)

The letter emphasizes long-term investing with references to 'long-term potential,' 'long-term secular growth trends,' and specific long-term projections like Japan Post Bank's net interest income doubling 'over the long term' and peak sales projections for biotech holdings. The investment process focuses on sustainable competitive advantages and superior business models, indicating a multi-year investment horizon.