Learn how Westwood SmallCap (WHGSX) can help you navigate through various market environments
Don’t strike out swinging for the fences.
Outfielder Ty Cobb, whose career ended in 1928, had the highest batting average in Major League Baseball (MLB) history, batting .366 over 24 seasons. His consistency, not his power, over the long term defined his success and legacy as one of the best MLB players of all time.
Often in strong rising markets, investors become myopic chasing performance in the highest-performing strategies believing recent events will persist long into the future. After a long-secular rise in small cap stocks, strategic investors need to consider the importance of both risk-adjusted returns and consistency, which tend to be underappreciated in the volatility-prone small cap asset class.
If interest rates rise, resulting in price to earnings multiples and profit margins peaking, avoiding marginal companies with a greater emphasis on high-quality companies trading at attractive prices will be increasingly important. Strategic long-term investors should emphasize consistency through multiple market environments to complement unmanaged small cap exposure or headline-grabbing high performers.
Take action: Learn how the Westwood SmallCap Fund (WHGSX) can potentially improve your risk-return profile across multiple market periods.
Average Excess Returns in Various Market Environments
Out performance across multiple market periods
Annualized Rolling 5-Year Returns Net of Fees
Westwood SmallCap Fund (WHGSX) vs. Russell 2000 Value Index
Westwood SmallCap: Key takeaways
A high-quality approach to small cap investing could be a way for investors to strategically allocate to the asset class in an attempt to improve consistency over the long term.
We believe high-quality businesses that are operating well with undervalued earnings potential offer competitive risk-adjusted returns.
Focused best ideas portfolio with historically high active share. Number of securities typically ranges from 50 to 70.
Our strategy utilizes a team-based fundamental bottom-up approach to identify high-quality companies.