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| Quarter | Letter Date | Fund Name | QTD | YTD | Tickers | Themes | Quick Take |
|---|---|---|---|---|---|---|---|
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"The Hotchkis & Wiley Large Cap Disciplined Value Fund outperformed its value benchmark in Q3 2025 with a 6.41% return. While cautioning that the broader S&P 500 is heavily overvalued at 25x forward earnings, the managers find excellent risk-adjusted value in their own portfolio at under 13x forward earnings."
During Q3 2025, the Hotchkis & Wiley Large Cap Disciplined Value Fund (I Shares) returned 6.41%, outperforming the Russell 1000 Value Index return of 5.33%. The broad market (S&P 500) rose 8.1%, propelled by narrow leadership. The manager warns that the S&P 500's multiple of 25x next year's consensus earnings represents extreme overvaluation (96th percentile). However, the fund's own portfolio trades at an attractive valuation of less than 13x consensus earnings. The manager highlights portfolio optimizations, which include raising the overall quality and lowering risk scores of holdings while lowering financials exposure by 3% to go underweight. Top positive performance contributors for the quarter included APA Corp., Warner Bros. Discovery, and Citigroup, while key detractors included WPP PLC, Comcast, and AIG.
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Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.
Market Conviction
High-conviction positioning: The Hotchkis & Wiley Large Cap Disciplined Value Fund outperformed its value benchmark in Q3 2025 with a 6.41% return. While cautioning that the broader S&P 500 is heavily overvalu...
Growth Outlook
Market outlook remains moderate conviction: The Hotchkis & Wiley Large Cap Disciplined Value Fund outperformed its value benchmark in Q3 2025 with a 6.41% return. While cautioning that the broader S&P 500 is heavily overvalu...
Risk Appetite
Risk appetite posture is moderate conviction: The Hotchkis & Wiley Large Cap Disciplined Value Fund outperformed its value benchmark in Q3 2025 with a 6.41% return. While cautioning that the broader S&P 500 is heavily overvalu...
Capital Deployment
Manager actively deployed capital into high-conviction opportunities. The Hotchkis & Wiley Large Cap Disciplined Value Fund outperformed its value benchmark in Q3 2025 with a 6.41% return. While cautioning that the broader S&P 500 is heavily overvalu...
Forward Guidance
Forward guidance signal: The Hotchkis & Wiley Large Cap Disciplined Value Fund outperformed its value benchmark in Q3 2025 with a 6.41% return. While cautioning that the broader S&P 500 is heavily overvalu...
Language Signal
Tone analysis indicates above average conviction language: The Hotchkis & Wiley Large Cap Disciplined Value Fund outperformed its value benchmark in Q3 2025 with a 6.41% return. While cautioning that the broader S&P 500 is heavily overvalu...
Perceived Risk
Perceived risk level is evaluated as above average conviction. The Hotchkis & Wiley Large Cap Disciplined Value Fund outperformed its value benchmark in Q3 2025 with a 6.41% return. While cautioning that the broader S&P 500 is heavily overvalu...
Opportunity Density
Opportunity density index indicates above average conviction actionable entry points. The Hotchkis & Wiley Large Cap Disciplined Value Fund outperformed its value benchmark in Q3 2025 with a 6.41% return. While cautioning that the broader S&P 500 is heavily overvalu...
Time Horizon
Investment time horizon reflects a high conviction orientation. The Hotchkis & Wiley Large Cap Disciplined Value Fund outperformed its value benchmark in Q3 2025 with a 6.41% return. While cautioning that the broader S&P 500 is heavily overvalu...
