You could lose money by investing in the Fund, and the Fund could underperform other investments. You should expect the Fund's share price and total return to fluctuate within a wide range. The Fund's performance could be hurt by:
- Manager risk. Dodge & Cox’s opinion about the intrinsic worth
of a company or security may be incorrect or the market may
continue to undervalue the company or security. Dodge & Cox
may not make timely purchases or sales of securities for the Fund.
- Interest rate risk. Debt security prices may decline due to rising
interest rates. The price of debt securities with longer maturities
is typically affected more by rising interest rates than the price of
obligations with shorter maturities.
- Credit risk. An issuer or guarantor of a debt security may be
unable or unwilling to make scheduled payments of interest and
principal. Actual or perceived deterioration in an issuer’s or
guarantor’s financial condition may affect a security’s value.
- Below investment-grade securities risk. Debt securities rated below
investment grade, also known as “high-yield” or “junk” securities
generally have greater credit risk, more price volatility, and less
liquidity than investment-grade securities.
- Call risk. If interest rates fall, issuers of callable bonds may repay
securities with higher interest rates before maturity. This could
cause the Fund to lose potential price appreciation and reinvest
the proceeds at lower interest rates.
- Liquidity risk. The Fund may not be able to purchase or sell a
security in a timely manner or at desired prices or achieve its
desired weighting in a security. Liquidity risk may result from
the lack of an active market or a reduced number and capacity
of traditional market participants to make a market in fixed
income securities and may be magnified in a rising interest rate
environment or other circumstances that cause increased supply
in the market due to selling activity.
- Non-diversification risk. As a non-diversified fund, the Fund may
invest a larger percentage of its assets in securities of a smaller
number of issuers than a diversified fund, which means a single
issuer’s performance may affect Fund performance more than if
the Fund were invested in a larger number of issuers.
- Mortgage- and asset-backed securities risk. Mortgage-related
securities permit early repayment of principal based on
prepayment of the underlying assets; changes in the rate of
repayment affect the price and volatility of an investment. If
prepayments occur faster than expected, the Fund receives lower interest payments than it expects. If prepayments occur slower
than expected, it delays the return of principal to the Fund.
Securities issued by certain U.S. government-sponsored entities
(GSEs) are not issued or guaranteed by the U.S. Treasury; there
is no assurance the U.S. government will provide support in the
event a GSE issuer cannot meet its obligations.
- Non-U.S. investment risk. Securities of non-U.S. issuers may be
less liquid, more volatile and harder to value than U.S.
securities. Non-U.S. issuers may be subject to political,
economic, or market instability, or unfavorable government
action in their local jurisdictions. There may be less information
publicly available about non-U.S. issuers and their securities and
those issuers may be subject to lower levels of government
regulation and oversight. Non-U.S. securities may decline in
value due to conditions specific to an individual country,
including unfavorable economic conditions relative to the
United States. There may be increased risk of delayed
transaction settlement or security certificate loss. These risks
may be higher when investing in emerging market issuers.
Certain of these risks may also apply to securities of U.S. issuers
with significant non-U.S. operations.
- Emerging market risk. Emerging market securities may present
issuer, market, currency, liquidity, volatility, valuation, legal,
political, and other risks different from, and potentially greater
than, the risks of investing in securities of issuers in more
- Non-U.S. currency risk. Foreign currencies may decline relative
to the U.S. dollar, which reduces the unhedged value of
investments denominated in or otherwise exposed to those
currencies. Dodge & Cox may not hedge or may not be
successful in hedging the Fund’s currency exposure.
- Derivatives risk. Investing with derivatives, such as forward
currency contracts, interest rate swaps, and futures contracts
involves risks additional to those associated with investing
directly in securities. The value of a derivative may not correlate
to the value of the underlying instrument to the extent
expected. Derivative transactions may be volatile, and can
create leverage, which could cause the Fund to lose more than
the amount of assets initially contributed to the transaction, if
any. The Fund may not be able to close a derivatives position at
an advantageous time or price. For over-the-counter derivatives
transactions, the counterparty may be unable or unwilling to
make required payments and deliveries, especially during times
of financial market distress.
- Sovereign debt risk. An issuer of sovereign debt or the
governmental authorities that control the repayment of the debt
may be unable or unwilling to repay principal or interest when
due. In the event of a default by a governmental entity on a
sovereign debt obligation, there may be few or no effective legal
remedies for collecting on such debt.
An investment in the Fund is not a deposit of a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency.
There are further risk factors described elsewhere in the prospectus and in the SAI.
The following bar chart is intended to help you understand the risks of investing in the Fund. The bar chart shows changes in the Fund's returns from year to year.
A private fund managed and funded by Dodge & Cox was reorganized into the Fund and the Fund commenced operations on May 1, 2014. This private fund commenced operations on December 5, 2012, and had an investment objective and strategies that were, in all material respects, the same as those of the Fund, and was managed in a manner that, in all material respects, complied with the investment guidelines and restrictions of the Fund. However, the private fund was not registered as an investment company under the Investment Company Act of 1940 (the "1940 Act"), and therefore was not subject to certain investment limitations, diversification requirements, liquidity 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. The Fund's performance for periods prior to the commencement of operations on May 1, 2014 is that of the private fund. The performance of the private fund has not been restated because the net total operating expense ratio of the private fund and the Fund are the same. The Fund's past performance (before and after taxes) does not necessarily indicate how the Fund will perform in the future. Average annual total returns can be viewed on the Performance & Prices page of this website.
|Highest/Lowest quarterly results during the time period were:
Highest: 3.03% (quarter ended June 30, 2014)
Lowest: —2.35% (quarter ended September 30, 2014)
Expense reimbursements have been in effect for the Fund since its inception. Without the expense reimbursements, returns for the Fund would have been lower.