The fund seeks capital appreciation in the long term by investing in companies outside the United States.
The fund manages assets through two sub-advisers, Massachusetts Financial Services Company and Harris Associates L.P.
The sub-advisers each are responsible for a portion of the portfolio, but not necessarily equally weighted.
The sub-advisers’ investment process starts with a list of companies in the benchmark index and the research team utilizes quantitative techniques and fundamental analysis to identify investment opportunities.
However, each sub-adviser may invest a significant percentage of the fund’s net assets in a single country or sector, a small number of countries or sectors, or a particular geographic region.
MFS favors companies exhibiting above average earnings growth potential, or that are estimated to trade below their fair values, or in a combination of growth and value companies.
Harris prefers companies that are trading at discounts to their estimated intrinsic value.
Next, the research team focuses on foreign companies, including companies located in Europe, Latin America, and Asia.
Then the manager constructs a portfolio of stocks from a list of companies favored by the research team and allocates capital based on its conviction level.
The fund may invest up to 25% of its net assets in securities of issuers in emerging markets.