Aristotle Pacific Captial
Strategic Credit

Strategy Overview

Tactical and Opportunistic Allocations to Credit Classes

The dynamic nature of credit markets presents opportunities for investors to improve outcomes by tactically allocating capital among asset classes. Our approach seeks to gain an advantage based on our focus and perspective in credit and agility within credit asset classes. Our strategic credit strategy invests opportunistically across the broad range of bank-loan, high-yield and investment grade opportunities with emphasis on relative-value analysis.

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Aristotle Pacific Captial
Short Duration

Strategy Overview

Current Income, Low Interest-Rate Risk

Our short-duration strategy invests in limited-maturity securities across credit classes and capital structures. We seek to position portfolios to provide investors with current income and limited exposure to interest-rate risk.

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Aristotle Pacific Captial
Core Plus

Strategy Overview

Agility, Access and Experience in Investment-Grade Bonds

When selecting a core or core-plus fixed-income strategy, we believe investors should consider the management team’s expertise, market access, and transactional agility. The strategy seeks to outperform the Bloomberg U.S. Aggregate Bond Index by investing primarily in investment-grade debt, with a focus on corporate credit. (The strategy may also invest in non-investment grade sectors along with sectors outside that of the Bloomberg U.S. Aggregate Bond Index.) Our core strategies benefit from seasoned and distinguished investment professionals sharing a unique perspective across credit markets.

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Aristotle Pacific Captial
High Yield

Strategy Overview

Bottom-Up, Credit-Intensive Analysis of High-Yield Bonds

An actively managed portfolio of high-yielding corporate bonds offers investors the potential to enhance overall diversification and boost current income. Through a selective, credit-intensive approach, our experienced high-yield team builds portfolios from the bottom up, one issuer at a time, with a keen eye for value.

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Aristotle Pacific Captial
CLOs

Strategy Overview

A Customized, Collateral-Focused CLO Investment Offering

A comprehensive approach to investing across liabilities and equity of CLOs managed by experienced credit managers. Offered in commingled fund vehicles.

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Aristotle Pacific Captial
Bank Loans

Strategy Overview

A Selective, Active Approach to Senior-Secured Loans

A selectively constructed portfolio of senior-secured loans offers investors the potential to improve the risk-reward characteristics of their fixed-income portfolios. Our approach is to be selective and active with a focus on larger, more liquid issues.

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Aristotle Capital Management
Global Equity

Strategy Overview

  • Fundamental, bottom‐up stock selection process applied to a universe of companies with market capitalizations typically in excess of $2 billion at initial investment
  • Focused strategy tends to be characterized by high active share and low turnover
  • Initial position size is approximately 2%
  • Portfolio is composed of global equities, utilizing both American Depositary Receipts (ADRs) and foreign ordinary shares
  • Objective is to achieve attractive long‐term returns versus the benchmark with a focus on mitigating risk over a complete market cycle

 

All portfolio holdings must meet the following three criteria:

  • High Quality: Companies in great and/or improving lines of business.
  • Attractive Valuation: Assess the value of the company utilizing private equity approach to public markets.
  • Compelling Catalyst: Actions/events currently underway that may propel a company forward over the next three to five years.

Strategy Inception Date: November 1, 2010

Assets: $1,405.6 million (as of 12/31/2024)

Benchmarks: MSCI ACWI Index (Net); MSCI World Index (Net)

Minimum Market Cap: Typically $2 billion at initial purchase

Cash: Typically less than 5%

Sector Weights: Within 50%-200% of MSCI World Index major sector weights

Vehicles Offered: Separate Account; Collective Trust; Mutual Fund

As of: 12/31/2024

Performance

Trailing (%) QTD YTD 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Inception1
Global Equity Composite (Gross) -7.72 3.67 3.67 1.01 7.93 9.45 9.56
Global Equity Composite (Net) -7.80 3.34 3.34 0.69 7.59 9.08 9.13
MSCI ACWI Index (Net) -0.99 17.49 17.49 5.44 10.06 9.23 9.23
MSCI World Index (Net) -0.16 18.67 18.67 6.34 11.17 9.95 10.17
Calendar Year (%) 2024 2023 2022 2021 2020 2019 2018
Global Equity Composite (Gross) 3.67 20.16 -17.27 20.20 18.24 29.18 -7.58
Global Equity Composite (Net) 3.34 19.80 -17.54 19.87 17.80 28.74 -7.93
MSCI ACWI Index (Net) 17.49 22.20 -18.36 18.54 16.25 26.60 -9.42
MSCI WORLD Index (Net) 18.67 23.79 -18.14 21.82 15.90 27.67 -8.71
1The Aristotle Global Equity Composite has an inception date of November 1, 2010.
Past performance is not indicative of future results. Performance results for periods greater than one year have been annualized. Returns are preliminary pending final account reconciliation. Returns are presented gross and net of actual investment advisory fees and include the reinvestment of all income. Gross returns will be reduced by fees and other expenses that may be incurred in the management of the account. Net returns are presented net of actual investment advisory fees and after the deduction of all trading expenses. This material is not financial advice or an offer to buy or sell any product. Please see important disclosures at the end of this web page.

Characteristics

  Global Equity MSCI ACWI
Number of Holdings 48 2,647
Active Share (%) 92.0
Annualized Turnover (5 Yrs, %) 10.0
Wtd. Avg. Market Cap ($B) 222.8 749.7
Dividend Yield (%) 1.9 1.8
Price/Earnings (TTM) 18.8x 22.3x
Price/Book Value 2.5x 3.2x

The Portfolio Characteristics shown are based on a representative account. Please see important disclosures at the bottom of this web page.

Portfolio Risk/Return Statistics

5 Years Global Equity MSCI ACWI Index (Net)
Upside Market Capture (%) 96 100
Downside Market Capture (%) 104 100
Annualized Alpha (%) -1.83
Tracking Error (%) 4.41
R-Squared 0.94 1.00
Beta 1.00 1.00
Standard Deviation (%) 17.97 17.48
Information Ratio -0.48
Sharpe Ratio 0.30 0.43

Largest Holdings (%)

Microsoft 5.0
Lennar 4.2
Cameco 3.7
Martin Marietta Materials 3.3
Munich Reinsurance 3.3
MonotaRO 3.0
DBS Group Holdings 2.8
Sony Group 2.8
Brookfield Corporation 2.6
Otsuka Holdings 2.6
Total 33.3

Region Weights (%)

Sector Weights (%)

Sources: CAPS CompositeHubTM, SS&C Advent, FactSet, MSCI, eVestment
MSCI ACWI (Net) was stated as the primary benchmark on June 1, 2024 andMSCI World (Net) became the secondary benchmark. The Largest Holdings shown are based on total account of the model portfolio. The Region Weights and Sector Weights shown are based on the model portfolio and exclude cash. The Portfolio Risk/Return Statistics figures are based on the Aristotle Global Equity Composite (“Composite”). The representative account was chosen since, in our view, it is the account within the Composite that most closely reflects the portfolio management style of the strategy. Not every client’s account will have these exact characteristics. The actual characteristics with respect to any particular client account will vary based on a number of factors, including but not limited to: (i) the size of the account; (ii) investment restrictions applicable to the account, if any; and (iii) market exigencies at the time of investment. You should not assume that any of the securities transactions, sectors or holdings discussed in this report are or will be profitable, or that recommendations Aristotle Capital Management, LLC (Aristotle Capital) makes in the future will be profitable or equal the performance of the securities listed in this report. There is no assurance that any securities, sectors or industries discussed herein will be included in or excluded from an account’s portfolio. Aristotle Capital reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs. This is not a recommendation to buy or sell a particular security. Recommendations made in the last 12 months are available upon request. Past performance is not indicative of future results. All investments carry a certain degree of risk, including the possible loss of principal. Investments are also subject to political, market, currency and regulatory risks or economic developments. International investments involve special risks that may in particular cause a loss in principal, including currency fluctuation, lower liquidity, different accounting methods and economic and political systems, and higher transaction costs. These risks typically are greater in emerging markets. Securities of small- and medium-sized companies tend to have a shorter history of operations, be more volatile and less liquid. Value stocks can perform differently from the market as a whole and other types of stocks. The material is provided for informational and/or educational purposes only and is not intended to be and should not be construed as investment, legal or tax advice and/or a legal opinion. Investors should consult their financial and tax adviser before making investments. The opinions referenced are as of the date of publication, may be modified due to changes in the market or economic conditions, and may not necessarily come to pass. Information and data presented has been developed internally and/or obtained from sources believed to be reliable. Aristotle Capital does not guarantee the accuracy, adequacy or completeness of such information. The MSCI ACWI Index is a free float-adjusted market capitalization-weighted index that is designed to measure the equity market performance of developed and emerging markets. The MSCI ACWI captures large and mid cap representation across 23 Developed Markets (DM) and 24 Emerging Markets (EM) countries. With approximately 2,900 constituents, the index covers approximately 85% of the global investable equity opportunity set. The MSCI World Index is a free float-adjusted market capitalization-weighted index that is designed to measure the equity market performance in 23 developed markets countries. The MSCI World Index includes the following countries: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the United Kingdom and the United States. The volatility (beta) of the Composite may be greater or less than that of the benchmarks. It is not possible to invest directly in these indices. Dividend Yield is the ratio of a firm’s dividends each year relative to its share price. Active Share is a measure of the percentage of stock holdings in a manager’s portfolio that differ from the benchmark index. Turnover is calculated by taking either the total purchases or total sales of portfolio securities (whichever is less), over a particular period, and dividing it by the monthly average market value of the portfolio during that period. Weighted Average Market Capitalization is a dollar-value measurement of the size of companies in a portfolio or index. In such a weighting scheme, an average figure is derived from the market capitalizations of each company (their market prices multiplied by the number of shares outstanding) multiplied by their weights in the portfolio or index. Price to Earnings is the ratio of a firm’s closing stock price and its trailing 12 months’ earnings per share. Price to Book is a ratio used to compare a stock’s market value to its book value. It is calculated by dividing the current closing price of the stock by the latest quarter’s book value per share. Upside Market Capture is a measure of the performance in up markets relative to the market itself. Downside Market Capture is a measure of the performance in down markets relative to the market itself. Annualized Alpha is a measure of risk-adjusted excess return over the style index. Tracking Error is the annualized standard deviation of the differences between the portfolio and index returns. R-Squared is a measure of how closely related the variance of the manager returns and the variance of the benchmark returns are. Beta is used to measure market risk. It is defined as the average relationship, over time, of the portfolio’s rate of return to the style index. Standard Deviation is a measure of risk or variability of returns over time. Higher deviation represents higher volatility. Information Ratio is a measure of returns above the benchmark (usually an index) relative to the volatility of those returns. Sharpe Ratio is a measure of the excess return over the risk-free rate relative to standard deviation to determine the reward per unit of risk.

Aristotle Capital Management, LLC is an independent investment adviser registered under the Investment Advisers Act of 1940, as amended. Registration does not imply a certain level of skill or training. More information about Aristotle Capital, including our investment strategies, fees and objectives, can be found in our Form ADV Part 2, which is available upon request. ACM-2501-50

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Aristotle Capital Management
International Equity

Strategy Overview

  • Fundamental, bottom-up stock selection process applied to a universe of companies with market capitalizations typically in excess of $2 billion at initial investment
  • Focused strategy tends to be characterized by high active share and low turnover
  • Initial position size is typically 2%‐3%
  • Portfolio is composed mainly of non‐U.S.‐based companies and may invest up to 20% in emerging markets, utilizing both American Depositary Receipts (ADRs) and foreign ordinary shares
  • Objective is to achieve attractive long-term returns versus the benchmarks while mitigating risk over a complete market cycle

 

All portfolio holdings must meet the following three criteria:

  • High Quality: Companies in great and/or improving lines of business.
  • Attractive Valuation: Assess the value of the company utilizing private equity approach to public markets.
  • Compelling Catalyst: Actions/events currently underway that may propel a company forward over the next three to five years.

Strategy Inception Date: January 1, 2008

Assets: $5,178.1 million (as of 12/31/2024)

Benchmarks: MSCI EAFE Index (Net); MSCI ACWI ex USA Index (Net)

Minimum Market Cap: Typically $2 billion at initial purchase

Cash: Typically less than 5%

Sector Weights: Within 50%-200% of MSCI EAFE Index major sector weights

Country Weights: Within 50%-200% of MSCI EAFE Index major country weights

Vehicles Offered: Separate Account; Mutual Fund; Collective Trust

As of: 12/31/2024

Performance

Trailing (%) QTD YTD 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Inception1
Int’l Equity Composite (Gross) -6.91 6.24 6.24 0.05 5.31 6.34 5.67
Int’l Equity Composite (Net) -7.02 5.76 5.76 -0.42 4.82 5.83 5.17
MSCI EAFE Index (Net) -8.11 3.82 3.82 1.65 4.73 5.20 2.83
MSCI ACWI ex USA Index (Net) -7.60 5.53 5.53 0.82 4.10 4.80 2.53
Calendar Year (%) 2024 2023 2022 2021 2020 2019 2018
Int’l Equity Composite (Gross) 6.24 18.54 -20.48 17.01 10.55 25.09 -9.74
Int’l Equity Composite (Net) 5.76 18.00 -20.86 16.46 10.03 24.50 -10.19
MSCI EAFE Index (Net) 3.82 18.24 -14.45 11.26 7.82 22.01 -13.79
MSCI ACWI ex USA Index (Net) 5.53 15.62 -16.00 7.82 10.65 21.51 -14.20
¹The Aristotle International Equity Composite has an inception date of January 1, 2008.
Past performance is not indicative of future results. Performance results for periods greater than one year have been annualized. Returns are preliminary pending final account reconciliation. Returns are presented gross and net of actual investment advisory fees and include the reinvestment of all income. Gross returns will be reduced by fees and other expenses that may be incurred in the management of the account. Net returns are presented net of actual investment advisory fees and after the deduction of all trading expenses. This material is not financial advice or an offer to buy or sell any product. Please see important disclosures at the end of this web page.

Characteristics

  Int’l Equity MSCI EAFE
Number of Holdings 39 722
Active Share (%) 89.7
Annualized Turnover (5 Yrs, %) 9.2
Wtd. Avg. Market Cap ($B) 69.0 86.0
Dividend Yield (%) 2.3 3.0
Price/Earnings (TTM) 20.1x 16.3x
Price/Book Value 2.5x 1.9x

The Portfolio Characteristics shown are based on a representative account. Please see important disclosures at the bottom of this web page.

Portfolio Risk/Return Statistics

Since Inception (1/1/08) Int’l Equity MSCI EAFE Index (Net)
Upside Market Capture (%) 105 100
Downside Market Capture (%) 102 100
Annualized Alpha (%) 0.51
Tracking Error (%) 3.53
R-Squared 0.97 1.00
Beta 1.04 1.00
Standard Deviation (%) 18.80 17.84
Information Ratio 0.16
Sharpe Ratio 0.15 0.12

Largest Holdings (%)

Brookfield Corporation (Canada) 4.8
Accenture (Ireland) 4.0
Sony Group (Japan) 3.9
Cameco (Canada) 3.8
Pan Pacific International Holdings (Japan) 3.7
MonotaRO (Japan) 3.6
DBS Group Holdings (Singapore) 3.4
Safran (France) 3.3
Nemetschek (Germany) 3.2
Ashtead Group (United Kingdom) 3.1
Total 36.8

Region Weights (%)

Sector Weights (%)

Sources: CAPS CompositeHubTM, SS&C Advent, FactSet, MSCI, eVestment
The Largest Holdings shown are based on total account of the model portfolio. The Region Weights and Sector Weights shown are based on the equity composition of the model portfolio and exclude cash. The Portfolio Risk/Return Statistics figures are based on the Aristotle International Equity Composite (“Composite”). The representative account was chosen since, in our view, it is the account within the Composite that most closely reflects the portfolio management style of the strategy. Not every client’s account will have these exact characteristics. The actual characteristics with respect to any particular client account will vary based on a number of factors, including but not limited to: (i) the size of the account; (ii) investment restrictions applicable to the account, if any; and (iii) market exigencies at the time of investment. You should not assume that any of the securities transactions, sectors or holdings discussed in this report are or will be profitable, or that recommendations Aristotle Capital Management, LLC (Aristotle Capital) makes in the future will be profitable or equal the performance of the securities listed in this report. There is no assurance that any securities, sectors or industries discussed herein will be included in or excluded from an account’s portfolio. Aristotle Capital reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs. This is not a recommendation to buy or sell a particular security. Recommendations made in the last 12 months are available upon request. Past performance is not indicative of future results. All investments carry a certain degree of risk, including the possible loss of principal. Investments are also subject to political, market, currency and regulatory risks or economic developments. International investments involve special risks that may in particular cause a loss in principal, including currency fluctuation, lower liquidity, different accounting methods and economic and political systems, and higher transaction costs. These risks typically are greater in emerging markets. Securities of small- and medium-sized companies tend to have a shorter history of operations, be more volatile and less liquid. Value stocks can perform differently from the market as a whole and other types of stocks. The material is provided for informational and/or educational purposes only and is not intended to be and should not be construed as investment, legal or tax advice and/or a legal opinion. Investors should consult their financial and tax adviser before making investments. The opinions referenced are as of the date of publication, may be modified due to changes in the market or economic conditions, and may not necessarily come to pass. Information and data presented has been developed internally and/or obtained from sources believed to be reliable. Aristotle Capital does not guarantee the accuracy, adequacy or completeness of such information. The MSCI EAFE Index (Europe, Australasia, Far East) is a free float-adjusted market capitalization-weighted index that is designed to measure the equity market performance of developed markets, excluding the United States and Canada. The MSCI EAFE Index consists of the following 21 developed markets countries: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland and the United Kingdom. The MSCI ACWI ex USA Index captures large and mid cap representation across 22 of 23 developed market countries (excluding the United States) and 24 emerging market countries. With over 2,200 constituents, the Index covers approximately 85% of the global equity opportunity set outside the United States. The volatility (beta) of the Composite may be greater or less than that of the benchmarks. It is not possible to invest directly in these indices. Excess returns are investment returns in excess of the benchmark or index returns. Dividend Yield is the ratio of a firm’s dividends each year relative to its share price. Active Share is a measure of the percentage of stock holdings in a manager’s portfolio that differ from the benchmark index. Turnover is calculated by taking either the total purchases or total sales of portfolio securities (whichever is less), over a particular period, and dividing it by the monthly average market value of the portfolio during that period. Weighted Average Market Capitalization is a dollar-value measurement of the size of companies in a portfolio or index. In such a weighting scheme, an average figure is derived from the market capitalizations of each company (their market prices multiplied by the number of shares outstanding) multiplied by their weights in the portfolio or index. Price to Earnings is the ratio of a firm’s closing stock price and its trailing 12 months’ earnings per share. Price to Book is a ratio used to compare a stock’s market value to its book value. It is calculated by dividing the current closing price of the stock by the latest quarter’s book value per share. Upside Market Capture is a measure of the performance in up markets relative to the market itself. Downside Market Capture is a measure of the performance in down markets relative to the market itself. Annualized Alpha is a measure of risk-adjusted excess return over the style index. Tracking Error is the annualized standard deviation of the differences between the portfolio and index returns. R-Squared is a measure of how closely related the variance of the manager returns and the variance of the benchmark returns are. Beta is used to measure market risk. It is defined as the average relationship, over time, of the portfolio’s rate of return to the style index. Standard Deviation is a measure of risk or variability of returns over time. Higher deviation represents higher volatility. Information Ratio is a measure of returns above the benchmark (usually an index) relative to the volatility of those returns. Sharpe Ratio is a measure of the excess return over the risk-free rate relative to standard deviation to determine the reward per unit of risk.

Aristotle Capital Management, LLC is an independent investment adviser registered under the Investment Advisers Act of 1940, as amended. Registration does not imply a certain level of skill or training. More information about Aristotle Capital, including our investment strategies, fees and objectives, can be found in our FormADV Part 2, which is available upon request. ACM-2501-51

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Aristotle Capital Management
Value Equity (U.S.)

Strategy Overview

  • Fundamental, bottom‐up stock selection process applied to a universe of companies with market capitalizations in excess of $2 billion at initial investment
  • Focused strategy tends to be characterized by high active share and low turnover
  • Initial position size is typically 2.0%‐2.5%, with a maximum position size 6% of portfolio market value
  • Portfolio is composed mainly of U.S.‐based companies and may invest up to 20% in companies based outside the U.S. (ADRs)
  • Objective is to achieve attractive long-term returns versus the benchmarks while mitigating risk over a complete market cycle

 

All portfolio holdings must meet the following three criteria:

  • High Quality: Companies in great and/or improving lines of business.
  • Attractive Valuation: Assess the value of the company utilizing private equity approach to public markets.
  • Compelling Catalyst: Actions/events currently underway that may propel a company forward over the next three to five years.

Strategy Inception Date : November 1, 2010

Assets: $44,583.3 million (as of 12/31/2024)

Benchmarks: Russell 1000 Value Index; S&P 500 Index

Minimum Market Cap: Typically $2 billion at initial purchase

Cash: Typically less than 5%

Sector Weights: Within 50%-200% of S&P 500 Index major sector weights

Vehicles Offered: Separate Account; Mutual Fund; Collective Trust

As of: 12/31/2024

Performance

Trailing (%) QTD YTD 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Inception1
Value Equity Composite (Gross) -4.09 8.20 8.20 3.68 10.09 11.47 12.62
Value Equity Composite (Net) -4.14 7.94 7.94 3.42 9.82 11.14 12.25
Russell 1000 Value Index -1.98 14.37 14.37 5.63 8.68 8.49 10.84
S&P 500 Index 2.41 25.02 25.02 8.94 14.53 13.10 14.15
Calendar Year (%) 2024 2023 2022 2021 2020 2019 2018
Value Equity Composite (Gross) 8.20 20.58 -14.58 25.87 15.29 33.50 -8.25
Value Equity Composite (Net) 7.94 20.29 -14.79 25.54 15.00 33.07 -8.58
Russell 1000 Value Index 14.37 11.46 -7.54 25.16 2.80 26.54 -8.27
S&P 500 Index 25.02 26.29 -18.11 28.71 18.40 31.49 -4.38
1The Aristotle Value Equity Composite has an inception date of November 1, 2010.
Past Performance is not indicative of future results. Performance results for periods greater than one year have been annualized. Returns are presented gross and net of investment advisory fees and include the reinvestment of all income. Gross returns will be reduced by fees and other expenses that may be incurred in the management of the account. Net returns are presented net of actual investment advisory fees and after the deduction of all trading expenses. This material is not financial advice or an offer to buy or sell any product. Please see important disclosures at the bottom of this web page.

Characteristics

  Value Equity R1000V
Number of Holdings 43 869
Active Share (%) 92.0
Annualized Turnover (5 Yrs, %) 10.6
Wtd. Avg. Market Cap ($B) 205.0 171.2
Dividend Yield (%) 1.9 2.1
Price/Earnings (TTM) 20.9x 19.8x
Price/Book Value 2.6x 2.5x

The Portfolio Characteristics shown are based on a representative account. Please see important disclosures at the bottom of this web page.

Market Cap Breakdown (%)

Portfolio Risk/Return Statistics

5 Years Value Equity Russell 1000 Value Index
Upside Market Capture (%) 98 100
Downside Market Capture (%) 94 100
Annualized Alpha (%) 1.62
Tracking Error (%) 4.61
R-Squared 0.94 1.00
Beta 0.97 1.00
Standard Deviation (%) 18.85 18.90
Information Ratio 0.31
Sharpe Ratio 0.40 0.33

Largest Holdings (%)

Parker Hannifin 4.6
Ameriprise Financial 3.8
Microsoft 3.6
Capital One Financial 3.2
Lennar 3.2
Corteva 3.0
Martin Marietta Materials 2.8
ANSYS 2.6
Adobe 2.6
Atmos Energy 2.5
Total 31.9

Sector Weights (%)

Sources: CAPS CompositeHubTM,SS&CAdvent, FactSet, Russell Investments, Standard & Poor’s, eVestment
The Largest Holdings shown are based on total account of the model portfolio. The Market Cap Breakdown shown is based on a representative account. The Sector Weights shown are based on equity composition of the model portfolio and exclude cash. The Portfolio Risk/Return Statistics figures are based on the Aristotle Value Equity Composite (“Composite”). The representative account was chosen since, in our view, it is the account within the Composite that most closely reflects the portfolio management style of the strategy. Not every client’s account will have these exact characteristics. The actual characteristics with respect to any particular client account will vary based on a number of factors, including but not limited to: (i) the size of the account; (ii) investment restrictions applicable to the account, if any; and (iii) market exigencies at the time of investment. You should not assume that any of the securities transactions, sectors or holdings discussed in this report are or will be profitable, or that recommendations Aristotle Capital Management, LLC (Aristotle Capital) makes in the future will be profitable or equal the performance of the securities listed in this report. There is no assurance that any securities, sectors or industries discussed herein will be included in or excluded from an account’s portfolio. Aristotle Capital reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs. This is not a recommendation to buy or sell a particular security. Recommendations made in the last 12 months are available upon request. Past performance is not indicative of future results. All investments carry a certain degree of risk, including the possible loss of principal. Investments are also subject to political, market, currency and regulatory risks or economic developments. International investments involve special risks that may in particular cause a loss in principal, including currency fluctuation, lower liquidity, different accounting methods and economic and political systems, and higher transaction costs. These risks typically are greater in emerging markets. Securities of small- and medium-sized companies tend to have a shorter history of operations, be more volatile and less liquid. Value stocks can perform differently from the market as a whole and other types of stocks. The material is provided for informational and/or educational purposes only and is not intended to be and should not be construed as investment, legal or tax advice and/or a legal opinion. Investors should consult their financial and tax adviser before making investments. The opinions referenced are as of the date of publication, may be modified due to changes in the market or economic conditions, and may not necessarily come to pass. Information and data presented has been developed internally and/or obtained from sources believed to be reliable. Aristotle Capital does not guarantee the accuracy, adequacy or completeness of such information. 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® Index companies with lower price-to-book ratios and lower expected growth values. The S&P 500® Index is the Standard & Poor’s Composite Index of 500 stocks and is a widely recognized, unmanaged index of common stock prices. The volatility (beta) of the Composite may be greater or less than that of the benchmarks. It is not possible to invest directly in these indices. Dividend Yield is the ratio of a firm’s dividends each year relative to its share price. Active Share is a measure of the percentage of stock holdings in a manager’s portfolio that differ from the benchmark index. Turnover is calculated by taking either the total purchases or total sales of portfolio securities (whichever is less), over a particular period, and dividing it by the monthly average market value of the portfolio during that period. Weighted Average Market Capitalization is a dollar-value measurement of the size of companies in a portfolio or index. In such a weighting scheme, an average figure is derived from the market capitalizations of each company (their market prices multiplied by the number of shares outstanding) multiplied by their weights in the portfolio or index. Price to Earnings is the ratio of a firm’s closing stock price and its trailing 12 months’ earnings per share. Price to Book is a ratio used to compare a stock’s market value to its book value. It is calculated by dividing the current closing price of the stock by the latest quarter’s book value per share. Upside Market Capture is a measure of the performance in up markets relative to the market itself. Downside Market Capture is a measure of the performance in down markets relative to the market itself. Annualized Alpha is a measure of risk-adjusted excess return over the style index. Tracking Error is the annualized standard deviation of the differences between the portfolio and index returns. R-Squared is a measure of how closely related the variance of the manager returns and the variance of the benchmark returns are. Beta is used to measure market risk. It is defined as the average relationship, over time, of the portfolio’s rate of return to the style index. Standard Deviation is a measure of risk or variability of returns over time. Higher deviation represents higher volatility. Information Ratio is a measure of returns above the benchmark (usually an index) relative to the volatility of those returns. Sharpe Ratio is a measure of the excess return over the risk-free rate relative to standard deviation to determine the reward per unit of risk.

Aristotle Capital Management, LLC is an independent investment adviser registered under the Investment Advisers Act of 1940, as amended. Registration does not imply a certain level of skill or training. More information about Aristotle Capital, including our investment strategies, fees and objectives, can be found in our FormADV Part 2, which is available upon request. ACM-2501-49

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Aristotle Capital Boston
Small Cap Equity

Strategy Overview

  • Investment objective is to maximize long-term capital appreciation while mitigating risk relative to the benchmark over multi-year periods
  • Diversified, quality-oriented portfolios managed with a long-term time horizon
  • Contrarian approach seeks to identify companies with low market expectations and a high probability of fundamental improvement that are trading with attractive upside potential and limited downside risk
  • Portfolios consist of companies that we believe can create shareholder value and possess quality management teams, attractive industry dynamics and strong or improving financials
  • Fundamental, bottom-up approach to security selection, typically investing in stocks within the market capitalization range of the Russell 2000 Index at the time of purchase

 

Investment process includes the following tenets:

  • Experienced Team: The research team consists of seven individuals averaging over 25 years of industry experience.
  • Long-Term Approach: We conduct bottom-up, fundamental research to identify quality-oriented businesses.
  • Depth of Research: We believe the overall depth and quality of information gathered leads to a more robust platform

Strategy Inception Date: July 1, 2002

The Small Cap Equity strategy initially began at a predecessor firm on July 1, 2002; however, the Small Cap Equity strategy has an inception date of January 1, 2015 at Aristotle Boston.

Assets: $2,118.1 million (as of 12/31/2024)

Holdings: 80-120

Benchmark: Russell 2000 Index

Individual Position Size: Maximum 4%

Annual Turnover: Typically 20% – 30%

Sector Weights: Maximum +/- 10% versus benchmark

Cash: Typically less than 5%

Vehicles Offered: Separate Account; Mutual Fund; Collective Trust

As of: 12/31/2024

Performance

Trailing (%) QTD YTD 1 Yr 3 Yrs 5 Yrs 10 Yrs Since Inception1
Small Cap Equity Composite (Gross) -0.31 10.04 10.04 2.29 7.15 8.63 9.28
Small Cap Equity Composite (Net) -0.46 9.40 9.40 1.66 6.52 8.04 8.51
Russell 2000 Index 0.33 11.54 11.54 1.24 7.40 7.82 7.52
Calendar Year (%) 2024 2023 2022 2021 2020 2019 2018
Small Cap Equity Composite (Gross) 10.04 7.56 -9.58 19.88 10.08 24.86 -11.59
Small Cap Equity Composite (Net) 9.40 6.85 -10.13 19.24 9.47 24.20 -12.03
Russell 2000 Index 11.54 16.93 -20.44 14.82 19.96 25.53 -11.01
1The Aristotle Small Cap Equity Composite has an inception date of November 1, 2006 at a predecessor firm. During this time, Dave Adams and Jack McPherson had primary responsibility for managing the strategy. Performance starting January 1, 2015 was achieved at Aristotle Boston.
Past performance is not indicative of future results. Performance results for periods greater than one year have been annualized. Returns are preliminary pending final account reconciliation. Returns are presented gross and net of actual investment advisory fees and include the reinvestment of all income. Gross returns will be reduced by fees and other expenses that may be incurred in the management of the account. Net returns are presented net of actual investment advisory fees and after the deduction of all trading expenses. This Material is not financial advice or an offer to buy or sell any product. Effective January 1, 2022, ACB Small Cap Composite has been redefined to exclude accounts with meaningful industry-specific restrictions or substantial values-based screens hampering implementation of the small cap strategy. Effective January 1, 2022, the Russell 2000 Value was removed as the secondary benchmark for the Aristotle Capital Boston Small Cap Equity strategy. Please see important disclosures at the end of this web page.

Characteristics

  Small Cap Equity Russell 2000
Number of Holdings 100 1,966
Active Share (%) 93.5
Turnover (1 Yr, %) 14.9
Dividend Yield (%) 1.4 1.3
Wtd. Avg. Market Cap ($B) 4.7 3.6
Price/Earnings (NTM) 16.9x 16.8x
Price/Book Value 1.9x 2.0x
Forward EPS Growth (5 Yrs, %) 13.6 11.6
Return on Equity (%) 9.6 4.9

The Portfolio Characteristics shown are based on a representative account. Please see important disclosures at the bottom of this web page.

Market Cap Breakdown (%)

Portfolio Risk/Return Statistics

5 Years Small Cap Equity Russell 2000 Index
Annualized Alpha (%) 0.40
Beta 0.90 1.00
Standard Deviation (%) 22.97 24.69
Information Ratio -0.04
Sharpe Ratio 0.20 0.20
Tracking Error (%) 6.52

Top Ten Holdings (%)

Huron Consulting Group 2.5
AerCap Holdings 2.3
MACOM Technology Solutions 2.3
Merit Medical Systems 2.3
Itron 2.2
ACI Worldwide 2.1
HealthEquity 2.0
Dycom Industries 1.9
Summit Materials 1.7
Advanced Energy Industries 1.7
Total 21.0

Sector Weights (%)

Sources: CAPS CompositeHubTM, SS&C Advent, FactSet, Russell Investments, eVestment
The Top Ten Holdings and Market Cap Breakdown shown are based on a representative portfolio within the Aristotle Small Cap Equity Composite. The Portfolio Risk/Return Statistics shown are based on the Aristotle Small Cap Equity Composite (Composite). The Sector Weights shown are based on the representative portfolio within the Aristotle Small Cap Equity Composite. The representative account was chosen since, in our view, it is the account within the Composite that most closely reflects the portfolio management style of the strategy. Not every client’s account will have these exact characteristics. The actual characteristics with respect to any particular client account will vary based on a number of factors, including but not limited to: (i) the size of the account; (ii) investment restrictions applicable to the account, if any; and (iii) market exigencies at the time of investment. You should not assume that any of the securities transactions, sectors or holdings discussed in this report are or will be profitable, or that recommendations Aristotle Capital Boston, LLC (Aristotle Boston) makes in the future will be profitable or equal the performance of the securities listed in this report. There is no assurance that any securities, sectors or industries discussed herein will be included in or excluded from an account’s portfolio. Aristotle Boston reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs. This is not a recommendation to buy or sell a particular security. Recommendations made in the last 12 months are available upon request. Past performance is not indicative of future results. All investments carry a certain degree of risk, including the possible loss of principal. Investments are also subject to political, market, currency and regulatory risks or economic developments. International investments involve special risks that may in particular cause a loss in principal, including currency fluctuation, lower liquidity, different accounting methods and economic and political systems, and higher transaction costs. These risks typically are greater in emerging markets. Securities of small- and medium-sized companies tend to have a shorter history of operations, be more volatile and less liquid. Value stocks can perform differently from the market as a whole and other types of stocks. The material is provided for informational and/or educational purposes only and is not intended to be and should not be construed as investment, legal or tax advice and/or a legal opinion. Investors should consult their financial and tax adviser before making investments. The opinions referenced are as of the date of publication, may be modified due to changes in the market or economic conditions, and may not necessarily come to pass. Information and data presented has been developed internally and/or obtained from sources believed to be reliable. Aristotle Boston does not guarantee the accuracy, adequacy or completeness of such information. The Russell 2000® Index measures the performance of the small cap segment of the U.S. equity universe. The Russell 2000 Index is a subset of the Russell 3000® Index, representing approximately 10% of the total market capitalization of that index. It includes approximately 2,000 of the smallest securities based on a combination of their market capitalization and current index membership. The volatility (beta) of the composite may be greater or less than the benchmark. It is not possible to invest directly in this index. Active Share is a measure of the percentage of stock holdings in a manager’s portfolio that differ from the benchmark index. Turnover is calculated by taking either the total purchases or total sales of portfolio securities (whichever is less), over a particular period, and dividing it by the monthly average market value of the portfolio during that period. Dividend Yield is the ratio of a firm’s dividends each year relative to its share price. Weighted Average Market Capitalization is a dollar-value measurement of the size of companies in a portfolio or index. In such a weighting scheme, an average figure is derived from the market capitalizations of each company (their market prices multiplied by the number of shares outstanding) multiplied by their weights in the portfolio or index. Price to Earnings is the ratio of a firm’s closing stock price and its trailing 12 months’ earnings per share. Price to Book is a ratio used to compare a stock’s market value to its book value. It is calculated by dividing the current closing price of the stock by the latest quarter’s book value per share. Forward EPS Growth is the percentage increase or decrease in the next five years’ earnings estimates compared to current year’s earnings estimates. Return on Equity is the amount of net income returned as a percentage of shareholders’ equity. Return on equity measures a corporation’s profitability by revealing how much profit a company generates with the money shareholders have invested. Debt to Equity ratio is used to measure a company’s financial leverage, calculated by dividing a company’s total liabilities by its shareholders’ equity. The ratio indicates how much debt a company is using to finance its assets relative to the amount of value represented in shareholders’ equity. Annualized Alpha is the measure of risk-adjusted excess return over the style index. Beta is used to measure market risk. It is defined as the average relationship, over time, of the portfolio’s rate of return to the style index. Standard Deviation is a measurement of risk or variability of returns over time. Higher deviation represents higher volatility. Information Ratio is a measurement of returns above the benchmark (usually an index) relative to the volatility of those returns. Sharpe Ratio is a measurement of the excess return over the risk-free rate relative to standard deviation to determine the reward per unit of risk. Tracking Error is the annualized standard deviation of the differences between the portfolio and index returns.

Aristotle Capital Boston, LLC is an independent investment adviser registered under the Investment Advisers Act of 1940, as amended. Registration does not imply a certain level of skill or training. More information about Aristotle Boston, including our investment strategies, fees and objectives, can be found in our Form ADV Part 2, which is available upon request. ACB-2501-17

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