• The Pax Large Cap Fund underperformed the S&P 500 Index during the third quarter.

Market Review

  • The Fund’s underperformance was a function of negative impacts from sector allocation and individual stock selection. The use of the Sustainability Lens, which identifies areas of opportunity and risk related to the transition to a more sustainable economy, also contributed negatively as avoiding high-risk low-opportunity sub-industries provided a headwind in the period.


  • In the midst of a challenging macro environment, the top active contributors were driven by stock specific factors.
  • Trane Technologies (Industrials) saw record Q2 earnings and a raise in full year guidance, as an increasing order book and the ability to pass on price increases at its energy efficient climate control systems enjoy continued demand.
  • Lowe’s (Consumer Discretionary) is navigating a turnaround, driven by cost controls and increasing focus on improving volumes to professional tradespeople.


  • The worst performers were impacted by the rising rate environment as well as changing expectations in a post Covid environment.
  • Organon & Company (Health Care)’s higher leverage profile is the primary driver of underperformance this quarter as interest rates have ticked up. In addition, management has cited challenges to certain women’s health therapies driven by the lower-than-expected OB-GYN visits in a post Covid world.
  • Stanley Black & Decker (Industrials) had disappointing results in the second quarter, and a significant negative revision, rebasing earnings as the company announced a major restructuring program to reduce inventories, take out layers of management, and reduce manufacturing complexity.


  • The macro environment continues to dominate performance with a slowing economy and a hawkish leaning Federal Reserve creating a difficult backdrop with weakening earnings and a higher discount rate being applied to these earnings. At current levels, the market is inferring a higher cost of equity than in more recent periods. The market hasn’t fully discounted a large pullback in earnings due to a recession, with consensus forward earnings estimates remaining somewhat stable. The team is taking a cautious approach, focusing efforts on trying to limit exposure to companies with higher probabilities of material negative earnings revisions, and identifying cyclical and valuation opportunities that will arise during these periods of heightened volatility.


(as of 9/30/22)
1-MonthQuarterYTD1 Year3 Year5 Year10 YearSince Inception1
Pax Large Cap Fund - Investor Class-10.03-7.00-25.41-18.189.9810.57-11.18
Pax Large Cap Fund - Institutional Class-9.99-6.89-25.22-17.9110.2710.86-11.46
S&P 500 Index-9.21-4.88-23.87-15.478.169.24-10.29
Lipper Large-Cap Core Funds Index-8.77-4.88-23.58-15.776.797.79-8.94

Performance data quoted represent past performance, which does not guarantee future results. Investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For most recent month-end performance information call 800.767.1729 or visit

Figures include reinvested dividends, capital gains distributions, and changes in principal value.

1The inception date for the Pax Large Cap Fund Institutional Class and the Investor Class is December 16, 2016.

As of 5/1/2022 prospectus, total annual Pax Large Cap Fund operating expenses, gross of any fee waivers or reimbursements (excluding Acquired Fund fees and expenses), for Investor Class and Institutional Class shares are 0.97% and 0.71%, respectively.ˆ

Performance Attribution

(6/30/22 - 9/30/22)
Sector: Average Active Weights (%)
Total Relative Contribution (%)

XOther: ETFs (for short-term cash mgmt. purposes) and Cash & Equivalents.
Past performance is no guarantee of future results. Short-term performance may not be indicative of long-term results.

Portfolio Characteristics

(as of 9/30/22)
Market Cap (weighted avg.)$391,901M$468,5433M
Forward Price/Earnings16.1616.05
Number of Securities51502

Top 10 Holdings

(as of 9/30/22)
Microsoft Corp. 6.1%, Apple, Inc. 5.0%, Alphabet, Inc., Class A 3.4%, Trane Technologies PLC 2.8%, Merck & Co., Inc. 2.6%, JPMorgan Chase & Co. 2.5%, Lowe’s Cos., Inc. 2.5%, CVS Health Corp. 2.5%, Walt Disney Co., The 2.5%, T-Mobile US, Inc. 2.5%. Holdings are subject to change.


ƒWeighted Average is an average in which each quantity to be averaged is assigned a weight. These weightings determine the relative importance of each quantity on the average.
Forward Price-Earnings Ratio or P/E FY1 ratio is a ratio for valuing a company that measures its current share price relative to its per-share earnings over the next 12 months.
Return on Equity: The amount of net income returned as a percentage of shareholders’ equity. Return on equity measures a corporations’ profitability by revealing how much profit a company generates with the money shareholders have invested.
Beta reflects the sensitivity of a Fund’s return to fluctuations in its benchmark; a beta for a benchmark is 1.00; a beta greater than 1.00 indicates above-average volatility and risk.

The statements and opinions expressed are those of the author as of the date of this report. All information is historical and not indicative of future results and subject to change. This information is not a recommendation to buy or sell any security. Past performance does not guarantee future results.

IMPX1263 (1/23)

Barbara Browning, Pax World Funds

Barbara Browning, CFA®

Portfolio Manager

Barbara Browning is a Portfolio Manager at Impax Asset Management LLC, the North American division of Impax Asset Management Group and investment adviser to Pax World Funds.

Barbara is a Portfolio Manager of the US Large Cap Strategy, which includes the Pax Large Cap Fund.

Prior to joining the firm in 2017, Barbara was Vice President and Senior Portfolio Manager at RBC Global Asset Management, Inc., where she co-managed Diversified Core, Concentrated Core and Diversified Large Cap Value Equity funds. Prior to that, Barbara was a Senior Portfolio Manager and Investment Officer at National City Bank, a Senior Research Analyst at Banc One Investment Advisors Corporation and held various equity research positions.

Barbara has a Bachelor of Arts in economics from The Ohio State University, where she graduated cum laude. She is also a CFA® charterholder.

Recent Insights

Andrew Braun, Pax World Funds

Andrew Braun

Senior Portfolio Manager

Andrew Braun is Senior Portfolio Manager at Impax Asset Management LLC, the North American division of Impax Asset Management Group and investment adviser to Pax World Funds.

He is a Senior Portfolio Manager of the US Large Cap Strategy, which includes the Pax Large Cap Fund. He is also a member of the Pax Sustainable Allocation Fund portfolio management team.

Prior to joining the firm in 2017, Andy was Managing Director on the value equity team at Goldman Sachs Asset Management, where he led a team of 30 portfolio managers and analysts. Andy joined Goldman Sachs Asset Management as a Product Development Associate in 1993. He was promoted to Portfolio Manager in 2001 and served as Co-Chief Investment Officer from 2008 to 2014. Before Goldman Sachs, Andy was a Financial Analyst in the corporate finance division of Dillon, Read & Co. Inc.

Andy has a Bachelor of Arts in economics from Harvard University and a Master of Business Administration in finance and economics from the Stern School of Business at New York University.

Recent Insights

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