In the fourth quarter of 2025, the Janus Henderson International Dividend Fund (HDIVX) recorded a return of 3.62%, falling short of the MSCI World ex-USA Index, which saw a 5.20% gain. This period was marked by significant central bank activity, with the U.S. Federal Reserve implementing two interest rate cuts, totaling 50 basis points, bringing the federal funds rate to 3.75%. Despite the overall underperformance against the benchmark, strategic stock selections in key sectors such as information technology, healthcare, and consumer discretionary contributed positively to the fund's relative performance. However, investments within the industrials and financials sectors faced headwinds, acting as detractors.

Looking ahead to 2026, the fund maintains a constructive perspective on global equity markets. This optimism is fueled by expectations of further reductions in interest rates and the rollout of fiscal stimulus packages in both the United States and Europe. Such macroeconomic conditions are anticipated to create a favorable environment for capital appreciation and income generation, underscoring the fund's continued focus on high-quality dividend-paying companies.

The management team diligently monitors various market dynamics, including employment figures and inflation rates, recognizing their potential to introduce unexpected volatility. Furthermore, careful attention is paid to regional and sector-specific valuation disparities, which could impact portfolio returns. The fund remains confident in its long-term positions, including companies like RELX, believing that concerns about AI disruption are largely overstated. While acknowledging the current softness in Japanese financials and the implications of tighter monetary policy, the fund is actively assessing these developments to mitigate risks and capitalize on emerging opportunities.

The fourth quarter of 2025 showcased a mixed performance for the Janus Henderson International Dividend Fund. While outperforming in select growth-oriented sectors, challenges emerged in more traditional industrial and financial segments. With central banks leaning towards accommodative policies and government-led stimulus initiatives on the horizon, the fund is strategically positioned to navigate the evolving market landscape and pursue its objective of delivering compelling returns for investors.