To help distinguish the fund, Clark typically turns to large, dull companies that are off the radar screen of most U.S. investors but have favorable characteristics and a visible presence abroad. Top holdings Xstrata, Akzo Nobel, Fresenius, Sodexo and Saipem, for example, occupy little or no space in most U.S. mutual funds, yet they have solid businesses and prospects for growth. Xstrata, a U.K. mining company, has recently been involved in on-again, off-again acquisition talks with an interested suitor, Brazilian mining giant Companhia Vale do Rio Doce (Vale), in a deal that would create the largest mining company in the world by market value. In April, Vale said it had discontinued the talks to acquire control of Xstrata, but reserved the right to announce a new offer for the firm within the next six months.

Akzo Nobel, a large Dutch industrial company, manufactures decorative paints and is also a worldwide supplier of specialty chemicals. Clark says the company is using its strong cash flow to buy back shares and to make strategic acquisitions. Meanwhile, the management at Saipem, an Italian construction and oil-drilling service company and one of the Henderson fund's better performers this year, has demonstrated an ability to manage business effectively in frontier markets such as developing Europe and the Middle East. And global health-care company Fresenius has successfully penetrated the market for kidney dialysis products and services, an area that should see strong growth with an aging and overweight population. The German company's hospital management arm is also in a position to benefit from plans by its home country to subcontract the management of its hospitals.

The International Opportunities Fund has a propensity for picking stocks that diverge from the standard mutual fund menu. In part, this is because the fund is close to the action in London, but the choices also stem from the decisions of five managers who handle their respective portions of the fund. Stephen Peak is a "growth-at-a-reasonable-price adherent with value leanings" who is responsible for up to 15 of the fund's European holdings. Tim Stevenson looks for up to 10 European growth stocks, while Andrew Millward specializes in Japanese value stocks. Andrew Mattock and Ian Warmerdam choose Asia ex-Japan and global tech stocks, respectively. According to the fund's latest fact sheet, Europe accounts for 56.2% of assets, followed by Japan at 16% Asia ex-Japan at 15% and global technology at 6.2%.

"My role is deciding how much to allocate toward each sleeve of the portfolio so I don't interfere with stock selection. I can argue, debate and voice my opinion, but I can't veto," says the 57-year-old Clark, who came to Henderson Global Investors in 1985 after working as an investment strategist specializing in Japan and Asia for a U.K. investment bank. The firm, which is well known overseas but is something of a dark horse in this country, manages $124 billion in assets and employs more than 900 people.

Among the decisions Clark makes is which sectors and regions to overweight or underweight relative to the index. He is slightly underweight in Europe and very underweight in the U.K., where a high budget deficit and falling interest rates are all too reminiscent of the faltering U.S. economy.
Earlier this year, the fund placed a currency hedge on sterling and the euro in anticipation of those currencies weakening against the dollar. But that did not happen, and the move hurt fund performance against the index. The fund is also underweight in Japan, where Clark sees some attractively valued stocks but nothing to dispel the pessimism that has weighed on that market. The fund is slightly overweight in Asia because of the region's strong growth.

Stock market volatility has created some buying opportunities to fill those portfolio sleeves. The fund's recent purchases include PetroChina, which explores, develops and produces crude oil and natural gas. In Europe, the fund recently sold Puma-because weak consumer demand could cause the stock to track sideways-and put that money into better investments such as Switzerland's ABB Ltd., a power and automation technologies provider that should benefit from infrastructure growth in Asia and in emerging markets.

Clark has also taken advantage of market dips to add to longtime holdings such as Capita Group, a U.K. outsourcing service company that performs administrative work for local governments and private companies. The competition is modest, he says, and the company has grown earnings consistently at a 15% to 20% annual rate over the last eight years.

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