Concentration Risk
The largest 5 stocks in the S&P 500 Index accounted for 22% of its value at the end of last month vs. under 12% five years earlier. In this one-pager, we look at how rising relative valuations were the predominant driver of this shift.
2021 3Q Letter to Investors: Valuation & Quality Update
October 18, 2021: We review recent performance of Distillate’s U.S. Fundamental Stability & Value (FSV), International FSV and Small Cap Quality & Value strategies. Amid a backdrop of strong price gains and pockets of extremely rich valuations, we believe valuation is becoming an increasingly important risk to equity returns going forward.
Distillate Capital Named Manager of the Year
April 8, 2021: Emerging Manager monthly announced their 2021 Emerging Manager Awards. Distillate Cap was honored to be named Large-Cap Equity Manger of the Year.
2021 2Q Letter to Investors: Valuation & Quality Update
July 16, 2021: In the wake of strong equity price gains across geographies and market caps, and amid pockets of very rich valuations, we review performance, portfolio changes, and how Distillate’s strategies compare to various benchmarks on measures of valuation and quality.
Asset Class Valuations in a Historical Context
June 15, 2021: Amid apprehensions about current valuations and their impact on prospective returns, we look at cash yields for various asset classes over time and relative to one another.
2021 1Q Letter to Investors: What the Growth vs. Value Debate is Missing
April 2021: n the U.S., 1Q21 brought a reversal in market leadership from the concentrated gains in “growth” stocks seen in 2020 to those commonly labeled “value.” After outperforming in an environment where traditional value lagged substantially, we were pleased to also generate excess returns in this recent period where growth stocks suffered.
2020 Year-end Letter to Investors
Distillate’s U.S. and international strategies outperformed their respective benchmarks in 2020. In the U.S., substantial outperformance among the largest stocks presented a significant headwind and the resulting rich valuations are making the overall market look somewhat expensive. Much of the risk from valuation appears concentrated in certain segments.
Distillate Capital Launches DSTX
December 15, 2020: Distillate Capital announced the launch of its second ETF, the Distillate International Fundamental Stability & Value ETF (NYSE:DSTX). This fund seeks to distill a starting universe of around 1,500 non-U.S. large- and mid-cap stocks down to 100 attractively valued stocks that exhibit stable cash flows and healthy balance sheets.
2020 Q3 Letter to Investors: Why We Owned… and Sold Apple
In addition to strategy updates for our U.S. (US FSV) and International (INTL FSV) Fundamental Stability & Value strategies, we look at the evolution Apple Inc. (AAPL) from one of the least expensive stocks in the market at various times over the last decade to one with a premium valuation today.
