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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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ValueWorks Capital 2026 Q1 Investor Letter | Buyside Digest

Back to Fund Profile (ValueWorks Capital)

Primary Source Intelligence • Q1 2026 Letter Analysis

ValueWorks Capital Quarterly Analysis

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

Fund Returns

QTD+8.29%

YTD+8.29%

Annualized+15.89%

Positioning StanceCONSTRUCTIVE

Market CapAll Cap

Digest Analysis

Quick Take

"Elevated geopolitical uncertainty and broad market turbulence create prime entry points to purchase undervalued companies at substantial discounts to asset value."

Executive Summary

ValueWorks Capital Appreciation Composite posted an 8.29% net-of-fees return for the first quarter of 2026, significantly outperforming major market benchmarks including the S&P 500, which fell 4.3%, the Dow, which fell 3.2%, and the Nasdaq, which declined 7.0%. Portfolio outperformance was primarily driven by idiosyncratic security selection and a meaningful 23% portfolio weighting to the energy sector. The strategy maintained its disciplined framework of holding 25 to 35 concentrated investments with position sizes typically targeted between 3% and 5% of portfolio assets. Macroeconomic conditions remained dominated by geopolitical tension and pronounced market volatility across asset classes. Rather than waiting for geopolitical dust to settle or market clarity to emerge, the strategy capitalized on prevailing uncertainty to acquire high-quality businesses trading at 25% to 50% discounts to appraised asset value. Portfolio management monetized positions that achieved fair value to expand liquidity and purchasing power for newly dislocated opportunities. Recent deployment was broad-based across market capitalizations, featuring new purchases such as Intel, Jefferies, Ørsted, Instacart, Clear Secure, and Hudson Pacific. These positions join top core holdings including Chord Energy, United Natural Foods, Valaris, Tidewater, and Amazon, where valuations provide compelling downside protection alongside upside potential.

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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

75%

CautiousHigh

High Conviction (75%)

Portfolio construction is concentrated in 25 to 35 holdings with individual allocations ranging between 3% and 5%. The manager explicitly identifies ten core holdings and articulates a rigid entry discipline requiring a 25% to 50% discount to intrinsic value. While individual company analyses are concise, high conviction is manifested in the deliberate strategy of scaling into dislocated positions during severe market drawdowns.

Growth Outlook

50%

BearishBullish

Neutral (50%)

Macro commentary acknowledges persistent near-term chaos and unpredictable geopolitical disruptions across broad indices. The manager remains agnostic regarding macro resolution, balancing market-wide headwinds against the emergence of attractive bottom-up equity valuations. Outlook is neither blanket bullish nor defensive, focusing strictly on asset-level mispricings created by broader market turbulence.

Risk Appetite

75%

DefensiveAggressive

Aggressive (75%)

Capital is actively tilted toward risk-seeking behavior by entering beaten-down equities amidst broader index selloffs. The fund runs a concentrated equity book with high cyclical exposure, led by a 23% weighting in energy and a 17% weighting in information technology. Downside protection is sought through valuation discounts rather than elevated cash or index hedging.

Capital Deployment

75%

De-riskingDeploying

Deploying (75%)

The strategy has been actively deploying capital into six named new positions across diverse sectors and capitalizations. Capital redeployment is sustained by harvesting gains in mature positions to maintain requisite liquidity. Deployment pace is intentionally elevated during volatile market quarters.

Forward Guidance

80%

CautiousExpansionary

Expansionary (80%)

The manager clearly signals an active deployment bias, stating that times of distress require executing without waiting for the dust to settle. Recent purchases across diverse capitalizations indicate ongoing accumulation of mispriced securities. Portfolio turnover is funded directly by harvesting fully valued winners to reallocate into deeply discounted assets.

Language Signal

65%

BearishBullish

Bullish (65%)

The text employs assertive opportunistic vocabulary, emphasizing bargain hunting, explosive upside, purchasing power, and downside protection. This constructive terminology is balanced against references to chaotic markets, geopolitical uncertainty, and market storms. On balance, the directional tone leans moderately bullish on available investment opportunities.

Perceived Risk

65%

Low RiskElevated

Elevated Risk (65%)

Geopolitical friction and macroeconomic uncertainty are explicitly highlighted as persistent drivers of near-term market volatility. The manager emphasizes that unpredictable macro resolutions create heightened market turbulence. However, risks are framed as standard cyclical volatility that generates mispriced assets rather than existential systemic threats.

Opportunity Density

75%

ScarceAbundant

Abundant (75%)

The manager highlights diverse and extensive buying opportunities over the past six months across mega, large, mid, and small market capitalizations. Depressed market prices caused by macro fears have expanded the investable pool of assets trading below fair value. The team notes a plentiful supply of individual names capable of delivering meaningful capital appreciation.

Time Horizon

55%

Short-TermLong-Term

Multi-Year (55%)

The fund explicitly defines an expected holding period of one to two years, anticipating positions to appreciate meaningfully over twelve to eighteen months. Portfolio turnover remains modest as investments are held until reaching full appraisal value. This timeline reflects an intermediate horizon rather than short-term trading or multi-decade compounding.