Vulcan Value Partners Focus Plus
Invests in companies with larger market capitalizations. Subject to price, any publicly traded company with above average economics that is not small (as defined by the Russell 2000 Index) would be a potential investment in this portfolio. Typically, we will hold 7 to 14 companies. These are great (as opposed to only good) businesses selling at extremely compelling price to value ratios. This portfolio uses options to further reduce risk. We do not employ any leverage. Instead, we use options to sell volatility when it is expensive and buy volatility when it is cheap. We sell options which give us the right to buy or sell stock in companies at prices that we would buy or sell anyway. We are compensated with option premiums. Generally, we use options instead of buying stock directly when we can earn double digit returns from selling options. In rare circumstances we will purchase options. Always, the goal is to reduce risk.
Performance (As of September 30, 2019)
|Investment Strategy||Inception Date||YTD||1 Year||3 Year||5 Year||10 Year||Since Inception|
|Focus Plus Composite (Gross)||03/30/07||32.2%||13.0%||17.6%||11.2%||15.2%||11.2%|
|Focus Plus Composite (Net)||30.9%||11.7%||16.6%||10.4%||14.1%||10.0%|
|Russell 1000 Value Index||17.8%||4.0%||9.4%||7.8%||11.5%||6.2%|
|S&P 500 Index||20.6%||4.3%||13.4%||10.8%||13.2%||8.4%|
|Investment Strategy||Focus Plus Composite (Gross)|
|Annualized: 1 Year||13.0%|
|Annualized: 3 Year||17.6%|
|Annualized: 5 Year||11.2%|
|Annualized: 10 Year||15.2%|
|Investment Strategy||Focus Plus Composite (Net)|
|Annualized: 1 Year||11.7%|
|Annualized: 3 Year||16.6%|
|Annualized: 5 Year||10.4%|
|Annualized: 10 Year||14.1%|
|Investment Strategy||Russell 1000 Value Index|
|Annualized: 1 Year||4.0%|
|Annualized: 3 Year||9.4%|
|Annualized: 5 Year||7.8%|
|Annualized: 10 Year||11.5%|
|Investment Strategy||S&P 500 Index|
|Annualized: 1 Year||4.3%|
|Annualized: 3 Year||13.4%|
|Annualized: 5 Year||10.8%|
|Annualized: 10 Year||13.2%|
Managed Accounts are available only for institutional and private clients of Vulcan Value Partners, LLC, a federally registered investment advisor. Vulcan funds are distributed by ALPS Distributors, Inc. Separately Managed Accounts and related investment advisory services are provided by Vulcan Value Partners, LLC, a federally regulated investment advisor. ALPS Distributors, Inc. is not affiliated with Vulcan Value Partners, LLC.
The performance presented is for our Focus Plus Composite. The model composite portfolio performance figures reflect the deduction of brokerage or other commissions and the reinvestment of dividends and capital gains. Past performance is no guarantee of future results, and we may not achieve our return goal. We have presented returns gross of fees and net of fees. Gross of fees returns are calculated gross of management and custodial fees and net of transaction costs. Net of fees returns are calculated net of management fees and transaction costs and gross of custodian fees, taken at the highest applicable fee. The performance figures do not reflect the deduction of any taxes an investor might pay on distributions or redemptions. Our standard fees are presented in Part II of our ADV.
There may be market or economic conditions which affect our performance, or that of our relevant benchmarks. Vulcan buys concentrated positions for our portfolios, averaging 5% in our model portfolios, which may make our performance more volatile than that of our benchmark indices and our performance may diverge from an index, positively or negatively, as a result. Our focus is on long term capital appreciation, so our clients should consider at least a five year time horizon for an investment with Vulcan.
The S&P 500 Index is an unmanaged index of 500 common stocks chosen for market size, liquidity, and industry group representation. It is a market-value weighted index. The Russell 1000® Value Index measures the performance of the large-cap value segment of the U.S. equity universe. It includes those Russell 1000 companies with lower price-to-book ratios and lower expected growth values. Index figures do not reflect deductions for any fees, expenses, or taxes. Investors cannot invest directly in an index.
Vulcan Value Partners, LLC is an investment advisor registered with the Securities and Exchange Commission under the Investment Advisers Act of 1940. Vulcan Value Partners focuses on long term capital appreciation targeting securities purchases that we believe have a substantial margin of safety in terms of value over price and limiting our investments to companies that we believe have sustainable competitive advantages that will allow them to earn superior returns on capital. Vulcan Value Partners claims compliance with the Global Investment Performance Standards (GIPS®). To receive a complete list and description of Vulcan Value Partners’ composites and a presentation that adheres to the GIPS standards, please contact Ashley Morris at 205.803.1582 or write Vulcan Value Partners, 3500 Three Protective Center, 2801 Highway 280 South, Suite 300, Birmingham AL, 35223.
Focus Plus Composite Information: This portfolio strategy invests in companies with larger market capitalizations. Subject to price, any publicly traded company with above average economics that is too large to be included in our small capitalization composite would be a potential investment in this portfolio. The portfolio is typically invested in between seven and fourteen names. We will use options instead of limit orders to acquire and/or sell the stock. We do not intend to employ any leverage but will utilize options to sell volatility when it is expensive and buy volatility when it is cheap. We will focus on options which give our clients the right to buy or sell stock in companies at prices that we would buy or sell anyway, and we will generate revenue through option premiums. Generally, we plan to use options instead of buying stock directly when we can earn double digit returns from selling options. We only intend to purchase options under rare circumstances and to continue to focus on reducing risk through the purchase of qualifying companies at attractive prices. We will not invest client assets in any business that is trading above our estimate of fair value. The composite benchmark is the S&P 500 which is an index of 500 stocks selected based on market size, liquidity, and sector and is designed to provide a broad snapshot of the overall U.S. equity market. New accounts that fit the composite definition are added at the beginning of the first full calendar month for which the account is under management. Closed account data is included in the composite as mandated by the standards in order to eliminate a survivorship bias. The composite was created on March 31, 2007. Portfolios below the minimum asset level of $50,000 are not included in the composite.
All returns are expressed in US dollars.