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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Oakmark Select Fund 2023 Q1 Investor Letter | Buyside Digest

Back to Fund Profile (Oakmark Select Fund)

Primary Source Intelligence • Q1 2023 Letter Analysis

Oakmark Select Fund Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, Oakmark Select Fund. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

Annualized+12.08%

Positioning StanceConstructive

GeographyUS

Digest Analysis

Quick Take

"Oakmark Select outperformed with 10.9% returns by opportunistically buying quality banks during the Silicon Valley Bank crisis. They initiated Charles Schwab and increased First Citizens and Wells Fargo positions while selling less attractive holdings."

Executive Summary

The Oakmark Select Fund generated a 10.9% return in Q1 2023, outperforming the S&P 500's 7.5% return. The fund capitalized on the banking sector crisis following Silicon Valley Bank and Signature Bank collapses, which created indiscriminate selling opportunities. They initiated a position in Charles Schwab and increased holdings in First Citizens and Wells Fargo while selling Allison Transmission, Citigroup, and Netflix. The managers emphasize their disciplined value approach, buying quality franchises at attractive valuations when market dislocations occur. First Citizens exemplified this strategy by acquiring Silicon Valley Bank assets from the FDIC, adding significant intrinsic value. Charles Schwab, despite mark-to-market concerns, offers superior deposit franchise quality and liquidity compared to troubled banks. The fund's concentrated approach allows them to take meaningful positions in their highest conviction ideas. Communication services and information technology were the largest contributing sectors, while energy and real estate detracted. The managers remain confident in their long-term value creation strategy.

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Institutional Meta Strategy

Meta Strategy Gauges

Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.

Signal Matrix

Market Conviction

78%

CautiousHigh

High Conviction (78%)

The fund demonstrates high conviction through concentrated positioning, specific position sizing language (largest position references), and detailed thesis explanations for individual holdings like Charles Schwab and First Citizens, though the diversified nature across sectors prevents maximum scoring.

Growth Outlook

60%

BearishBullish

Neutral (60%)

The managers express confidence that their disciplined approach will continue to drive attractive returns and view market dislocations as creating good opportunity sets, indicating a constructive but measured market outlook.

Risk Appetite

70%

DefensiveAggressive

Balanced (70%)

The fund actively deployed capital during the banking crisis, initiating new positions and increasing existing ones while maintaining their concentrated approach, demonstrating a risk-on positioning during market stress.

Capital Deployment

65%

De-riskingDeploying

Net Neutral (65%)

The fund actively deployed capital during the quarter by initiating Charles Schwab and increasing First Citizens and Wells Fargo positions while selling three holdings, indicating moderate to strong deployment activity despite no specific cash level data.

Forward Guidance

55%

CautiousExpansionary

Neutral (55%)

The managers state confidence in their approach continuing to drive attractive returns and emphasize their ability to capitalize on future opportunities, showing a moderately positive deployment bias.

Language Signal

65%

BearishBullish

Bullish (65%)

Language emphasizes opportunities, attractive valuations, quality franchises, and positive surprises, with limited risk language beyond standard market acknowledgments, creating a net positive directional signal.

Perceived Risk

45%

Low RiskElevated

Moderate Risk (45%)

The managers acknowledge banking sector concerns and mark-to-market risks but frame these as opportunities rather than systemic threats, showing moderate risk awareness without alarm.

Opportunity Density

75%

ScarceAbundant

Abundant (75%)

The managers describe an unusually good opportunity set in banking and emphasize their ability to find attractive risk-reward opportunities, indicating a rich opportunity environment.

Time Horizon

70%

Short-TermLong-Term

Decade+ (70%)

The fund emphasizes long-term value investing, deferred gratification, and multi-year intrinsic value growth, with references to holdings since 2018 and 2021, indicating a multi-year investment horizon.