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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Hotchkis & Wiley Global Value Fund 2024 Q4 Investor Letter | Buyside Digest

Back to Fund Profile (Hotchkis & Wiley Global Value Fund)

Primary Source Intelligence • Q4 2024 Letter Analysis

Hotchkis & Wiley Global Value Fund Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, Hotchkis & Wiley Global Value Fund. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

QTD-3.01%

YTD+9.43%

Annualized+9.26%

Positioning StanceConstructive

Market CapLarge Cap

GeographyGlobal

Digest Analysis

Quick Take

"Global value fund outperformed value benchmark in Q4 despite -3.01% decline amid political and policy uncertainty. Technology remains largest overweight as managers see less cyclical businesses with growth potential."

Executive Summary

The Hotchkis & Wiley Global Value Fund returned -3.01% in Q4 2024, outperforming the MSCI World Value Index which declined -4.20%. For the full year, the fund gained 9.43% versus 11.47% for the value benchmark. Market sentiment weakened in Q4 due to Eurozone political instability, hawkish Fed policy, and trade war concerns. Value stocks continued to lag growth for the year, with only materials posting negative returns among GICS sectors. The fund maintains technology as its largest overweight, viewing these businesses as less cyclical than perceived and offering attractive diversification. Healthcare detracted most from relative performance due to pressure on holdings like Elevance Health and CVS from higher medical costs. Contributors included F5, Alphabet, and General Motors on strong earnings and attractive valuations. The managers believe wide valuation disparities between growth and value, and between the portfolio and benchmark, create a promising environment for active value investing despite recent headwinds.

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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

68%

CautiousHigh

Moderate (68%)

The fund demonstrates moderate-high conviction through concentrated sector positioning (technology as largest overweight), specific named holdings with detailed thesis explanations, and clear views on individual companies like Samsung's DRAM position and GM's valuation. However, the diversified nature across multiple sectors and regions prevents a higher score.

Growth Outlook

38%

BearishBullish

Neutral (38%)

The managers acknowledge market headwinds including political instability, hawkish Fed policy, and trade concerns, while noting weak European growth. However, they express optimism about valuation disparities creating opportunities and maintain confidence in their portfolio's prospects.

Risk Appetite

10%

DefensiveAggressive

Defensive (10%)

The fund maintains concentrated overweight positions in technology and selective positioning across sectors. While they acknowledge risks, they continue to hold conviction positions and express confidence in their holdings' prospects, suggesting a mildly constructive risk appetite.

Capital Deployment

5%

De-riskingDeploying

De-risking (5%)

The managers state they made very minor changes to individual positions during the quarter, with current sector weightings better reflecting industry performance. This suggests minimal net deployment activity, scoring near neutral with slight positive bias for maintaining positions.

Forward Guidance

25%

CautiousExpansionary

Cautious (25%)

The managers express confidence about the portfolio's prospects and believe the current environment is highly conducive to long-term focused active management. They see promising outlook for value investing given wide spreads, indicating a constructive deployment bias.

Language Signal

0%

BearishBullish

Bearish (0%)

The language is balanced between acknowledging risks and challenges (political instability, hawkish Fed, trade concerns, healthcare pressures) and highlighting opportunities (attractive valuations, promising outlook, confidence in prospects). Risk and opportunity language are roughly balanced.

Perceived Risk

55%

Low RiskElevated

Moderate Risk (55%)

The managers identify several specific risks including Eurozone political instability, hawkish Fed policy, trade war threats, and weak European economic growth. Healthcare sector faces cost pressures. While risks are acknowledged and discussed, they are not characterized as systemic or extreme.

Opportunity Density

70%

ScarceAbundant

Abundant (70%)

The managers see attractive opportunities created by wide valuation disparities between growth and value, and between their portfolio and benchmark. They describe the environment as highly conducive to active management and express confidence in their holdings' prospects, suggesting a relatively rich opportunity set.

Time Horizon

75%

Short-TermLong-Term

Decade+ (75%)

The fund emphasizes long-term focused active management and discusses multi-year themes like DRAM demand growth driven by AI and cloud computing. Healthcare businesses are expected to reprice annually and recover over one to two years, indicating a patient, multi-year investment horizon.