Portfolio Manager since 2004
Small Cap Value
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YTD Return
12.08%as of
Return is shown net of fees. See performance below for additional disclosure.
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Total Assets ($MM)
$142.5 MMas of
Profile
The Cambiar Small Cap Value portfolio is a diversified strategy that invests primarily in small-cap companies domiciled in the U.S. This equal-weight portfolio will hold between 45-55 stocks with a starting universe that includes any company with a market cap between $500 million to $5 billion.
Key Facts
- Inception Date
- 11/30/2004
- Minimum
- $5 MM
Portfolio Managers
-
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Portfolio Manager since 2018
Performance
MTD | YTD | 1 YR | 3 YR | 5 YR | 10 YR | Since Inception | |
---|---|---|---|---|---|---|---|
Small Cap Value (g) | 12.16 | 12.16 | -3.02 | 10.75 | 3.52 | 14.35 | 9.44 |
Small Cap Value (n) | 12.08 | 12.08 | -3.93 | 9.77 | 2.60 | 13.30 | 8.37 |
R2000V | 10.94 | 10.94 | -4.51 | 13.76 | 6.62 | 13.28 | 6.78 |
QTR | YTD | 1 YR | 3 YR | 5 YR | 10 YR | Since Inception | |
---|---|---|---|---|---|---|---|
Small Cap Value (g) | -18.06 | -11.30 | -11.30 | 3.34 | 0.41 | 12.59 | 8.61 |
Small Cap Value (n) | -18.27 | -12.13 | -12.13 | 2.42 | -0.48 | 11.55 | 7.55 |
R2000V | -18.67 | -12.86 | -12.86 | 7.37 | 3.61 | 10.40 | 6.04 |
Inception Date: 11.30.2004. The performance information depicted above represents Cambiar’s Small Cap Value Composite (Institutional). Returns are presented gross (g) and net (n) of management fees. Gross and net returns are reduced by transaction expenses. Net returns are also reduced by actual investment advisory fees and other expenses that may be incurred in the management of the account. Prior to 2014, the gross returns reflect accounts with both gross and “pure” gross performance. From 2014 to present, the composite contains accounts with only gross performance. “Pure” gross returns, applicable to SMA portfolios, are not reduced by any expenses, which includes transaction costs, and are provided as supplemental information. Brokerage firms which sponsor SMA fee programs apply bundled fees which may include transactions costs, investment management, portfolio monitoring, consulting services, and in some cases, custodial service fees. Net returns for SMA portfolios are calculated by subtracting actual SMA fees reported by the SMA sponsor. Net of fees performance reflects a blended fee schedule of all accounts within the Small Cap Value Composite (Institutional). Cambiar clients and mutual fund investors may incur actual fee rates that are greater or less than the rate reflected in this performance summary. Results are reported in U.S. dollars.
Performance results for the Small Cap Value Composite (Institutional) are evaluated against the Russell 2000® Value Index. The Russell 2000® Value Index is a float-adjusted, market capitalization weighted index comprised of firms in the Russell 2000® Index that experience lower price-to-book ratios and lower forecasted growth values. The Russell 2000® Index is a float-adjusted, market capitalization weighted index that measures the performance of the 2,000 smallest companies in the Russell 3000® Index, which consists of 3,000 of the largest U.S. equities. The index assumes no management, custody, transaction or other expenses. The Russell 2000 Value Index is a broadly based index that reflects the overall market performance and Cambiar’s returns may not be correlated to the index. The index is unmanaged and one cannot invest directly in an index. Cambiar’s performance and the performance of the Russell 2000 Value Index include the reinvestment of all income. Performance is preliminary, please contact us for finalized figures. As with any investments, there are risks to be considered. Past performance is no indication of future results.
View Cambiar’s GIPS compliant presentations here.
Composition
Top 10 holdings
as of 12/31/2018
% Weight | ||
---|---|---|
01
|
Natus Medical | 2.5 |
02
|
Axis Capital | 2.3 |
03
|
Enersys | 2.3 |
04
|
Imperva | 2.2 |
05
|
Orion Engineered Carbons | 2.2 |
06
|
Yelp | 2.2 |
07
|
Idacorp | 2.2 |
08
|
Valvoline | 2.2 |
09
|
Marcus & Millichap | 2.2 |
10
|
Penske Automotive | 2.1 |
Sector Weights (%)
as of 12/31/2018
Attributes
as of 12/31/2018
Cambiar | R2000V | |
---|---|---|
Price/Earnings F1Y | 12.6 | 11.9 |
Price/Book | 1.6 | 1.2 |
Debt/Equity | 0.8 | 0.8 |
EPS Growth LT (%) | 11.2 | 12.1 |
Market Cap - Wtd. Avg. ($B) | 2.7 | 1.8 |
Market Cap - Median ($B) | 2.4 | 0.6 |
Active Share
as of 12/31/2018
RISK STATISTICS
as of 12/31/2018
Cambiar | R2000V | |
---|---|---|
Alpha | -2.8 | 0.0 |
Beta | 0.9 | 1.0 |
R-Squared | 85.6 | 100.0 |
Sharpe Ratio | 0.0 | 0.3 |
Standard Deviation | 13.9 | 14.7 |
Data is provided for a representative account as of December 31, 2018. Portfolio holdings, characteristics, country breakdown, and sector weightings change over time and may differ between clients based upon their investment objectives, financial situations and risk tolerances. Cambiar makes no warranty, either express or implied, that the weightings shown will be used to manage your account. The securities presented do not represent all of the securities purchased, sold, or recommended by Cambiar and the reader should not assume that investments in the securities identified were or will be profitable. The information provided on the page should not be considered a recommendation to buy or a solicitation to purchase or sell any particular security. There can be no assurance that an investor will earn a profit or not lose money. There can be no assurance that the portfolio will continue to hold the same position in companies described herein, and the portfolio may change any portfolio position at any time. As with any investments, there are risks to be considered. Past performance is no indication of future results.
The one year forecast is included for illustrative purposes and accordingly, no assumptions or comparisons should be made based upon these ratios. Risk statistics are based off a five-year time frame. Portfolio characteristics are based upon third-party sources that are deemed to be reliable, however, Cambiar does not guarantee its accuracy or completeness.
Total Assets represents assets under management for the strategy and are subject to change. Minimums represent intended/proposed minimums for institutional clients and are subject to change.
The Russell 2000® Value Index is a trademark/service mark of the Frank Russell Company. Russell® is a trademark of the Frank Russell Company.
Definitions:
Active Share – a holdings-based measure of active management representing the percentage of securities in a portfolio that differ from those in the benchmark index.
Price/Earnings (F1Y) – a calculation that divides the current share price by the estimates of earnings in the next four quarters.
Debt/Equity – Long Term is a calculation that takes interest-bearing, long-term debt divided by shareholder equity.
EPS Growth – Long Term is a calculation that takes the company’s estimated profits for five years divided by the outstanding shares.
Alpha – a measure of risk-adjusted performance.
Beta – a measure of risk in relation to the market or benchmark.
R-Squared – a measure of how closely a portfolio’s performance correlates with the performance of a benchmark index
Sharpe Ratio – a direct measure of reward-to-risk and is calculated by subtracting the risk-free rate from the rate of return for a portfolio and dividing the result by the standard deviation.
Standard Deviation – a statistical measure of historical volatility; a measure of the extent to which numbers are spread around their average.
Commentary
Domestic Markets – 4Q18 Review
After posting consistent quarterly gains over the past three years (with the -0.8% return in 1Q18 as the sole exception), U.S. stocks (defined as the S&P 500 Index) incurred a sharp correction in the fourth quarter. The hallmark resiliency that U.S. equities have shown over the course of the current cycle was nowhere to be found in 4Q, as the wall of worry simply became too high for stocks to overcome. The drawdown in equities was broad-based in nature, with large-cap stocks managing to hold up marginally better than their small-cap counterparts. The fourth quarter return of -13.5% for the S&P resulted in a 2018 return of -4.4%. Although the ratherly disorderly end of the year was likely unsettling to many investors, it is important to keep in mind that 2018 is the first year for a negative return in the S&P since 2008…it’s been a heck of a run. In a year where almost all asset classes were auto-correlated to the downside, diversification efforts did not provide much relief for investors in 2018. Cash was the notable bright spot for the year, although even this asset class may have finished in the red after adjusting for inflation.
In reviewing market action in the quarter, stocks sustained a mild pullback in October, stabilized in November, and then accelerated to the downside in December. A virtual laundry list of concerns weighed on investor sentiment: a steep drop in oil prices, global growth concerns, a flattening yield curve (including a modest inversion between the 3-year and 5-year), the ongoing trade skirmish with China, and continued tightening measures by the Federal Reserve. Of all of the above factors, the withdrawal of liquidity from the markets (and resulting increase in cost of capital) is likely the biggest concern for the equity markets. The absence of the ‘Fed Put’ is a big change in market dynamics, and with policy error as the primary catalyst for past recessions, all eyes are understandably on the Fed. This is not to say that the current business cycle cannot continue; however, the rising tide environment of the past ten years is unlikely to continue.
Stocks were volatile throughout the quarter, but particularly during the holiday-shortened last week of the quarter. Given that most firms were in skeleton staff mode for the holidays, we believe that program trades amplified the mercurial moves in stock prices. These systematic approaches take a variety of forms – algorithmic trading, high-frequency trades (HFT), trend following, delta hedging, etc…, but a shared attribute amongst these strategies is that buy/sell decisions are non-fundamental in nature. The takeaway is that the shift in equity ownership from traditional active management to more systematic vehicles and passive/ETF options results in a change in market structure. Small fluctuations in market flows can now lead to outsized moves in stock prices.
For Cambiar, the day-to-day investment process has not changed. With no shortage of cross-currents in the market that can influence decisionmaking, the Cambiar team remains focused on fundamentals to drive the buy/sell decision in our portfolios. We continue to seek high-quality companies where we believe to be a disconnect between current valuation and anticipated future cashflow and earnings. To the extent that indiscriminate market declines provide an attractive attachment point for some of these great compounders, we are willing participants in identifying such investments on behalf of our clients.
Certain information contained in this communication constitutes “forward-looking statements”, which are based on Cambiar’s beliefs, as well as certain assumptions concerning future events, using information currently available to Cambiar. Due to market risk and uncertainties, actual events, results or performance may differ materially from that reflected or contemplated in such forward-looking statements. The information provided is not intended to be, and should not be construed as, investment, legal or tax advice. Nothing contained herein should be construed as a recommendation or endorsement to buy or sell any security, investment or portfolio allocation. Securities highlighted or discussed have been selected to illustrate Cambiar’s investment approach and/or market outlook. The portfolios are actively managed and securities discussed may or may not be held in client portfolios at any given time, do not represent all of the securities purchased, sold, or recommended by Cambiar, and the reader should not assume that investments in the securities identified and discussed were or will be profitable.
Any characteristics included are for illustrative purposes and accordingly, no assumptions or comparisons should be made based upon these ratios. Statistics/charts are based upon third-party sources that are deemed reliable; however, Cambiar does not guarantee its accuracy or completeness. As with any investments, there are risks to be considered. Past performance is no indication of future results. All material is provided for informational purposes only and there is no guarantee that any opinions expressed herein will be valid beyond the date of this communication.