Around the World in Search of Value

Thornburg International Value Fund is a focused, diversified portfolio of leading, mostly large-cap international companies, selected via a fundamentally driven, bottom-up, valuation-sensitive process. The fund is centered on providing attractive risk-adjusted returns with mitigated volatility versus its benchmarks.
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“Our stock selection philosophy centers on building a focused, but diversified portfolio of international companies. We like to find industry leaders when they are out of favor, offering value in the context of long-term prospects. The portfolio will be invested primarily in the developed markets of Europe and the Asia Pacific region, but does include some emerging-market holdings. We believe diversification among three types of stocks below provides the opportunity for our portfolio to produce positive total returns over time. Stock selection is a key element in achieving our objectives.”

— Bill Fries

A Focus on Risk-Adjusted Returns

We focus on constructing a core portfolio with potential to outperform benchmarks over time — with lower volatility. One way we mitigate volatility is via Thornburg’s three-basket diversification construct:

Basic value companies are, in our opinion, financially sound, well-established businesses selling at low valuations relative to net assets or earnings power.

Consistent earners normally exhibit steady earnings growth, cash-flow characteristics, and/or dividend growth. These companies may have above-average profitability measures, and may sell at above-average valuations.

Emerging franchises are often in the process of establishing a leading position in a product, service, or market, or have the potential to grow at an above-average rate.

A Broad, Nuanced View of Valuation

Some value managers who don’t diversify across a basket structure may have a narrow view of valuation, with a single set of metrics or constraints by which they evaluate stocks. Our view of valuation is flexible and varies across basket structures. It is a broader, more nuanced, less formulaic take.

A Consistent, Repeatable Process

We have selected stocks via the same bottom-up, collaborative, fundamentally driven, repeatable process since the fund’s inception more than 15 years ago.

Seeking Promising, Quality Companies at a Discount

We look for promising, quality companies — industry leaders with modest financial risk and demonstrated management competence — trading at a discount to their intrinsic value.

A Focus on Economic Exposure, not Country of Domicile

We generally focus on a company’s economic exposure (the countries or markets from which it derives most revenues) not its country of domicile. Of the top 10 holdings, most operate in a number of countries worldwide, with a significant share of sales and earnings from outside the country of domicile.

Emerging Markets Exposure

The portfolio has historically had exposure to emerging markets — either through firms domiciled in emerging markets or through firms that derive a large portion of revenues from them. The inclusion of emerging-markets holdings, while they are often more volatile, has benefitted the fund over the years.

Benchmark Aware, Not Benchmark Driven

While we respect the necessary role a benchmark plays in assessing management skill, we don’t use benchmarks as starting points in constructing the portfolio. We focus on individual security selection and managing risk.

Morningstar Fund Manager of the Year

2014 Lipper Fund Award2003 – Portfolio Manager Bill Fries was Morningstar’s 2003 Fund Manager of the Year for the international stock category. This award, according to Morningstar, “recognizes portfolio managers who demonstrate excellent investment skill and the courage to differ from the consensus. To qualify for the award, managers must have not only a great year, but also must have a record of delivering outstanding long-term performance and of aligning their interests with shareholders’. . . . Winners are chosen based upon Morningstar’s proprietary research and in-depth evaluation by its senior analysts.”

Thornburg did not receive this award in subsequent years.

Important Information
Before investing, carefully consider the Fund’s investment goals, risks, charges, and expenses. For a prospectus or summary prospectus containing this and other information, contact your financial advisor or visit our literature center. Read them carefully before investing.

Investments carry risks, including possible loss of principal. Additional risks may be associated with investments outside the United States, especially in emerging markets, including currency fluctuations, illiquidity, volatility, and political and economic risks. Investments in small- and mid-capitalization companies may increase the risk of greater price fluctuations. Investments in the Fund are not FDIC insured, nor are they bank deposits or guaranteed by a bank or any other entity.

The performance of any index is not indicative of the performance of any particular investment. Unless otherwise noted, index returns reflect the reinvestment of income dividends and capital gains, if any, but do not reflect fees, brokerage commissions or other expenses of investing. Investors may not make direct investments into any index.

Diversification does not assure or guarantee better performance and cannot eliminate the risk of investment losses.

As of August 1, 2009, Thornburg Investment Management no longer offers Class B Shares. See the current prospectus for more information.

Class R shares are limited to retirement platforms only.

Class I shares may not be available to all investors. Minimum investments for the I share class may be higher than those for other classes.

There is no guarantee that the Fund will meet its investment objectives.

Please see our glossary for a definition of terms.

Thornburg mutual funds are distributed by Thornburg Securities Corporation.

Thornburg Investment Management, Inc. mutual funds are sold through investment professionals including investment advisors, brokerage firms, bank trust departments, trust companies and certain other financial intermediaries. Thornburg Securities Corporation (TSC) does not act as broker of record for investors.