LMVTX
ClearBridge Value-C
Introduction to ClearBridge Value-C
ClearBridge Value-C (LMVTX) is a mutual fund that seeks long-term growth of capital by investing primarily in equity securities that offer the potential for capital growth. The fund adheres to a value discipline, focusing on purchasing securities at significant discounts to their intrinsic value. Managed by Franklin Templeton Investments, this fund is categorized under Large Cap Value, making it an attractive option for investors looking for value-oriented growth opportunities. With an expense ratio of 1.75%, the fund aims to deliver superior returns by identifying undervalued stocks in the market.
At A Glance
Executive Summary
LMVTX offers value-focused equity investments with a 1-year return of 33.24%, outperforming peers with a disciplined value strategy.
Strong 1-year return of 33.24%. Value discipline in stock selection. Diverse sector allocation with financials leading.
Higher expense ratio at 1.75%. Negative alpha indicating underperformance. Lower yield at 0.51% compared to peers.
Performance Analysis: A Year of Strong Returns
In the past year, ClearBridge Value-C has delivered an impressive 33.24% return, showcasing its ability to capitalize on market opportunities despite its value-oriented approach. This performance is noteworthy when compared to its benchmark, the S&P 500 Total Return Index, which posted a 37.62% return over the same period. While the fund slightly underperformed the benchmark, its returns are competitive within the Large Cap Value category. The fund’s annualized returns over five years stand at 14.01%, indicating consistent performance over a longer horizon. This makes LMVTX a compelling choice for investors seeking robust returns in a value-focused strategy.
Sector Allocation: A Diverse Portfolio
ClearBridge Value-C maintains a diversified sector allocation, with significant investments in financials (19.93%), healthcare (14.91%), and technology (13.13%). This diversification helps mitigate risks associated with sector-specific downturns while providing exposure to sectors with growth potential. The fund’s allocation to financials is particularly noteworthy, as it aligns with the value investing philosophy of capitalizing on undervalued sectors. Additionally, the fund’s exposure to utilities (10.46%) and energy (11.29%) sectors provides a balance between growth and stability, making it suitable for investors looking for a well-rounded portfolio.
Top Holdings: Strategic Stock Selection
The top holdings of ClearBridge Value-C reflect its strategic approach to stock selection, with significant positions in companies like Johnson & Johnson (2.93%), Bank of America Corp (2.74%), and Vistra Corp (2.50%). These holdings indicate a preference for established companies with strong fundamentals and potential for capital appreciation. The inclusion of technology giant Meta Platforms Inc (2.09%) and healthcare leader UnitedHealth Group Inc (2.21%) further underscores the fund’s commitment to investing in industry leaders. This strategic stock selection is designed to enhance the fund’s growth potential while adhering to its value investing principles.
Risk Metrics: Understanding the Fund’s Volatility
ClearBridge Value-C exhibits a beta of 0.90, indicating lower volatility compared to the broader market. However, the fund’s negative alpha of -4.42% suggests that it has underperformed its benchmark on a risk-adjusted basis. The Sharpe ratio of -0.33 further highlights the fund’s challenges in delivering risk-adjusted returns. Despite these metrics, the fund’s standard deviation of 3.90% indicates moderate volatility, which may appeal to investors seeking a balance between risk and return. The fund’s downside risk (UI) of 2.27% and max drawdown of -9.1% provide additional insights into its risk profile, helping investors make informed decisions.
Competitive Comparison: Expense and Yield Considerations
When compared to similar funds, ClearBridge Value-C’s expense ratio of 1.75% is relatively higher, which may be a consideration for cost-conscious investors. However, its 1-year return of 33.24% is competitive, outperforming peers like Pioneer Fundamental Growth-C (29.18%) and Alger Growth & Income-C (29.35%). The fund’s yield of 0.51% is lower than some peers, which may be a drawback for income-focused investors. Despite these considerations, the fund’s disciplined value approach and strong performance make it a viable option for those prioritizing capital growth over income.
Investor Suitability: Who Should Consider LMVTX?
ClearBridge Value-C is well-suited for investors seeking long-term capital growth through a value-oriented investment strategy. Its focus on undervalued large-cap stocks makes it an attractive option for those looking to capitalize on market inefficiencies. The fund’s diversified sector allocation and strategic stock selection provide a balanced approach to growth and stability, appealing to investors with a moderate risk tolerance. However, the higher expense ratio and lower yield may deter cost-sensitive and income-focused investors. Overall, LMVTX is ideal for those prioritizing growth potential and value investing principles.
Conclusion: A Value Fund with Growth Potential
In conclusion, ClearBridge Value-C stands out as a value-focused mutual fund with a strong track record of capital growth. Its disciplined approach to stock selection and diversified sector allocation make it a compelling choice for investors seeking long-term growth opportunities. While the fund’s higher expense ratio and lower yield may be considerations for some, its impressive 1-year return and strategic investment approach highlight its potential for capital appreciation. Investors looking for a value-oriented fund with growth potential should consider LMVTX as a valuable addition to their portfolio.
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