The Large Cap Value Fund posted a total return of 0.70% for the quarter, compared with 3.02% for the Funds benchmark, the Russell 1000® Value Index. Stock selection in the financials, industrials and consumer discretionary sectors, along with not having exposure to the utilities sector, detracted from Fund performance. Stock selection contributed to relative performance in the energy and information technology sectors.
As we wait for our slow-motion recovery to pick up speed, we will continue to follow our discipline of investing in out-of-favor companies offering strong underlying value that we believe will be beneficiaries of better times and trends ahead. With correlations now widening and money flowing into U.S. stocks from bonds, commodities, and weaker global economies, we believe we are in a sweet spot for stock picking and our actively managed large-cap value strategy.
If you are a value-oriented investor seeking long-term capital appreciation with the relatively lower risks of large, dividend-paying stocks, this Fund may be ideal for you. With its emphasis on relatively low-priced, high-yielding stocks, it can work in tandem with a growth-oriented fund to create a well-balanced, diversified stock portfolio.
- Focus on valuation and dividend yield, which is designed to contribute positively to total return and provide a cushion against market volatility.
- Select stocks based on valuation levels, financial strength and earnings growth potential, identifying a catalyst for potential appreciation, such as a new product line or corporate restructuring.
- Maintain a strict sell discipline — systematically sell stocks that we believe have achieved their true value.