Westwood LargeCap Value – Socially Responsible

The Westwood LargeCap Value – Socially Responsible strategy invests in approximately 40-60 companies with attractive valuations that meet client-defined criteria. Clients typically specify criteria in areas of religious, union, healthcare, or socially responsible restrictions. The portfolio team seeks high quality companies with prospects for future profitability that are significantly stronger than are reflected in the current stock price. Companies with ample free cash flow and low debt are preferred.

Portfolio risk is controlled by limiting the target weight of each holding, imposing maximum position limits, and limiting sector weightings. The beta of the portfolio is typically less than that of the market. Additionally, the portfolio will vote proxies at the client’s direction.

Buy discipline

Analysts focus on ideas that have limited downside risk and the opportunity to generate earnings/cash flows that are higher than what the current stock price implies. Companies are closely monitored and factors considered in analyzing securities include:

Improving ROE (return on equity)
A declining debt/equity ratio
Positive cash flow
Positive earnings surprise without a corresponding increase in Wall Street earnings estimates

Sell discipline

The sell discipline is essential to controlling portfolio risk and includes:

Stock achieves final price objective
Fundamental change in company or industry that negatively impacts original investment thesis

Performance

(As of 1/31/2013)

	Inception date	1Q13	YTD	1 yr trailing	3 yr trailing	5 yr trailing	Since Inception
Socially Responsible Large Cap Value	1/1/1998	9.2%	9.2%	13.8%	11.1%	4.6%	7.5%
Net of Fees		9.0%	9.0%	13.1%	10.5%	4.1%	6.8%
Russell 1000 Value		12.3%	12.3%	18.8%	12.7%	4.9%	6.0%

Click to download composite performance details.

“Past performance is not a guarantee of future returns. Returns are preliminary and are subject to change. Click here for the performance disclosure. The disclosures provided are considered an integral part of this presentation.”