Download Click to download DGHM ACV March 2016

Hereford Funds DGHM US All-Cap Value Fund
March 2016
Investment Review
The Hereford Funds DGHM US All-Cap Value Fund Class A shares returned 9.4% for the month of March compared to a 7.3% return for the
Russell 3000 Value Index. The S&P 500 returned 6.8%. On a year-to-date basis, the Class A shares have returned 2.8% while the benchmark has
returned 1.6%. The S&P 500 has returned 1.4% year-to-date. Sectors that added value during the month were led by Capital Goods (Fluor +17%),
Energy (PDC Energy +19%), and Insurance (Lincoln National +13%). Only one sector underperformed by more than 20 basis points this month and
that was Transportation (Union Pacific +1%). This stock did not keep pace with the benchmark as rails lagged trucking and airline stocks due to
concerns over near-term fundamentals in shipping coal and agricultural products.
We purchased two new names this month and sold two names as well. In Energy, we purchased QEP Resources, which is a North American oil
shale company. The company has solid assets and a strong balance sheet. This purchase will take our energy weight higher as we are bullish on
rising oil prices in 2016 and 2017. In Insurance, we purchased RenaissanceRe Holdings. This is a global reinsurer trading at the lower end of its
historical range that has produced superior returns relative to its peers. We believe the company has a superior risk-reward to XL Group and Lincoln
Thank you for your continued support.
Investment Objective
The investment objective of the ACV sub fund is to provide capital appreciation over a multi-year investment horizon by investing primarily in a
diversified portfolio of publicly traded equity securities of US based companies, which the Investment Manager believes to be undervalued. The
companies will generally have a market capitalizations of more than USD 1 billion.
The sub fund may, on an ancillary basis, invest in US-based companies with higher or lower capitalizations as well as in non US-based companies.
The Compartment may invest in American Depository Receipts and American Depository Shares.
The indicative benchmarks are the Russell 3000 Value and the S&P 500 Indices.
Key Information
NAV A Shares:
Total Fund Size:
as of March 31, 2016
(a)
$555.75mil
July 31, 2009
Strategy Assets:
Fund Launch Date:
$185.92
$70.33mil
Monthly Performance (%)
HF DGHM US ACV
Russell 3000 Value Index(c)
(c)
S&P 500 Index
as of March 31, 2016
Jan-16 Feb-16 Mar-16 Apr-16 May-16
0.4
9.4
(6.4)
0.0
7.3
(5.3)
(0.1)
6.8
(5.0)
Jun-16
Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16
4 yr
7.8
11.4
12.4
5 yr
5.7
10.0
11.6
Period Performance (%)
YTD
2.8
1.6
1.4
Since Inception (January 1, 1983 - March 31, 2016)
DGHM ACV / HF DGHM US ACV
(c)
Russell 3000 Value Index
(c)
S&P 500 Index
(b)
YTD
2.8
1.6
1.4
1 yr
(8.2)
(2.0)
1.8
2 yr
(1.3)
3.3
7.1
3 yr
7.0
9.1
11.8
Value of a Dollar
10 yr
5.5
5.6
7.0
Cumulative
3093.9
3614.0
3266.7
Annualized
11.0
11.5
11.2
Past Ten Years (March 31, 2006 - March 31, 2016)
DGHM ACV / Hereford Funds DGHM US ACV(b) vs. Russell 3000 Value(c) & S&P 500(c)
200
KEY
DGHM ACV/Hereford Funds DGHM US ACV
Russell 3000 Value
S&P 500
150
Start of HF DGHM
US ACV
100
50
Mar-06
Mar-07
Mar-08
Mar-09
Mar-10
Mar-11
Mar-12
Mar-13
Mar-14
Mar-15
Mar-16
Hereford Funds DGHM US All-Cap Value Fund
March 2016
Portfolio
as of March 31, 2016
Sector Breakdown
Industrial Cyclicals
Consumer Cyclicals
Technology
Non-Cyclicals
Financials
Utilities
[Cash]
Total
%
32.1
10.5
9.7
9.9
25.1
10.4
2.3
100.0
Top Ten Holdings
Pfizer Inc.
JPMorgan Chase & Co.
Halliburton Company
Cisco Systems, Inc.
Public Service Enterprise Group
Fluor Corporation
WEC Energy Group Inc
AT&T Inc.
Check Point Software Technologies
QEP Resources, Inc.
%
4.26
3.66
3.65
3.63
3.62
3.46
3.44
3.41
3.34
3.24
Total
35.7
Since Inception (January 1, 1983 - March 31, 2016)
(d)
Risk Statistics
Volatility
Sharpe Ratio
Information Ratio
Tracking Error
Beta
Alpha
DGHM ACV
16.48
0.54
(listed below benchmark)
(listed below benchmark)
(listed below benchmark)
(listed below benchmark)
R3KV S&P 500
15.67
15.94
0.48
0.45
0.20
0.20
6.77
8.17
0.96
0.90
1.83
2.79
Fund Details
Bloomberg:
ISIN:
Reuters:
Sedol:
Valoren:
WKN:
HERACVALX*
LU0435791347
N/A
B5MDN13
10269479
A0RPYP
* Share Class A
Dealing day:
Dividends:
Investment Manager:
Management Company:
Custodian:
Legal Advisers:
Auditor:
Annual Management Charge
(e)
Share Class A
Share Class D(f)
Share Class B(g)
1.25%
1.75%
0.95% (capped TER at 1.20%)
Daily
None (income accumulated within the fund)
Dalton, Greiner, Hartman, Maher & Co., LLC, 565 Fifth Avenue, #2101, NYC, 10017, USA
BSI Fund Management S.A., 44F rue de la Vallée, L-2661 Luxembourg
BSI Europe S.A., 122 rue Adolphe Fischer, L-1521 Luxembourg
Elvinger, Hoss & Prussen, 2 Place Winston Churchill, L-1340 Luxembourg
Deloitte Audit S.à.r.l.
Minimum Investment
Share Class A
Share Class D
Share Class B
$100,000 initial; $10,000 subsequent
$10,000 initial; $1,000 subsequent
$10,000,000 initial; $100,000 subsequent
Order Transmission / Information
Original Applications to:
UBS Fund Services
Attn: Transfer Agent
33a, avenue J.F. Kennedy
L-1855 Luxembourg
Subsequent Applications only via Facsimile:
UBS Fund Services
Attn: Transfer Agent
Fax: (+352) 4410106417
Tel: (+352) 4410106404
Email: [email protected]
(a) This refers to the total assets invested in the reference strategy managed by the Investment Manager. Assets include third party platform assets for which DGHM does not have full
conditional authority, and which have been excluded from the definition of the firm for GIPS purposes. The assets consist of direct wrap relationships estimated at $289 million and model
portfolio relationships estimated at $11 million as of 31/03/16.
(b) Data and graph depict DGHM composite through July 2009 and Hereford Funds DGHM US All-Cap Value Class A thereafter. Historical net performance of DGHM All-Cap Value
Composite returns (the Reference Strategy) includes modelled fee and expense typical of Hereford Funds DGHM US All-Cap Value Fund Class A (1.25% fee + 0.25% expense). Fund follows
same strategy. Performance presentation incomplete without accompanying footnotes as shown at www.dghm.com.
(c) Total return including dividends.
(d) Source: FactSet – All numbers are based on the DGHM AllCap Value composite and presented gross of fees and expenses.
(e) Share Class A is registered with the BaFin for public distribution in Germany, registered with the AFM for public distribution in the Netherlands, registered with the AMF for public distribution
in France, registered with Finma for public distribution in Switzerland, and has been granted Reporting Status by HMRC as of October 1st, 2010.
(f) Share Class D is registered with the BaFin for public distribution in Germany, registered with the AFM for public distribution in the Netherlands. registered with the AMF for public distribution
in France, and registered with Finma for public distribution in Switzerland.
(g) Share Class B is registered with the BaFin for public distribution in Germany.
France - Centralizing Correspondent as defined by French Regulation:
Société Générale - Order Desk, 32, avenue du Champ de Tir, BP 81236, F-44312 Nantes Cedex 3;
Phone: +33/2.51.85.66.40, Fax: +33/2.51.85.58.71
Germany – Paying Agent as defined by German Regulation:
Marcard, Stein & Co – Ballindamm 36, 20095 Hamburg;
Phone: +49/40.32.099.556, Fax: +49/40.32.099.206
Switzerland - Representative and Paying Agent as defined by Swiss Regulation:
Société Générale, Zurich Branch - Talacker, 50, P.O. Box 1928, CH-8021 Zurich;
Phone: +41/58.272.34.18 Fax: +41/58.272.35.49
This document is for information purposes and internal use only. It is neither an advice nor a recommendation to enter into any investment. Investment suitability must be determined
individually for each investor, and the financial instruments described above may not be suitable for all investors. This information does not provide any accounting, legal, regulatory or tax
advice. Please consult your own professional advisers in order to evaluate and judge the matters referred to herein. An investment should be made only on the basis of the prospectus, the
annual and any subsequent semi-annual-reports of HEREFORD FUNDS (the "Fund"), a société d'investissement à capital variable, established in Luxembourg and registered under Part I of
Luxembourg law of 20 December, approved by the Commission de Surveillance du Secteur Financier (CSSF). These can be obtained from the Fund, from BSí FUND MANAGEMENT S.A.,
44F, rue de la Vallée, L- 2661 Luxembourg, and any distributor or intermediary appointed by the Fund. No warranty is given, in whole or in part, regarding performance of the Fund. There is no
guarantee that its investment objectives will be achieved. Potential investors shall be aware that the value of investments can fall as well as rise and that they may not get back the full amount
invested. Past performance is no guide to future performance. The information provided in this document may be subject to change without any warning or prior notice and should be read in
conjunction with the most recent publication of the prospectus of the Fund. Whilst great care is taken to ensure that information contained herein is accurate, no responsibility can be accepted
for any errors, mistakes or omission or for future returns. This document is intended for the use of the addressee or recipient only and may not be reproduced, redistributed, passed on or
published, in whole or in part, for any purpose, without the prior written consent of HEREFORD FUNDS. Neither the CSSF nor any other regulator has approved this document.