Value Equity

We believe that:

• Stocks that are relatively inexpensive with cyclically improving earnings should provide superior returns.
  
• Valuation disparities tend to correct over time, but cheap stocks are more likely to outperform when unexpected positive news raises expectations.
  
• Real value should be visible across multiple metrics and not distorted by accounting.
  
• Buying when returns and margins are historically low and rising may reduce risk and enhance returns.
  
• Favorable price momentum and low volatility can improve risk-adjusted returns.

We want to invest where:

• Valuation is attractive;
  
• Fundamentals provide a margin of safety;
  
• Sales and earnings are recovering from recently depressed levels;
  
• Investor expectations are still too low.