Period and Average Annual Total Returns as of September 30, 2016
Inception Date: July 31, 2016

Diamond Hill Capital Management, Inc. (DHCM) claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with the GIPS Standards. DHCM has been independently verified for the period 5/31/00 – 6/30/16. DHCM’s current verification firm is Ashland Partners & Company, LLP. Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm’s policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. The Small Cap Composite has received a Performance Examination from 12/31/00 – 6/30/16. The Small-Mid Composite has received a Performance Examination from 12/31/05 – 6/30/16. The Large Cap Composite has received a Performance Examination from 6/30/01 – 6/30/16. The Large Cap Concentrated Composite has received a Performance Examination from 12/31/11 – 6/30/16. The Select Composite has received a Performance Examination from 6/30/00 – 6/30/16. The verification and performance exam reports are available upon request. DHCM is a registered investment adviser and wholly owned subsidiary of Diamond Hill Investment Group, Inc. DHCM provides investment management services to individuals and institutional investors through mutual funds, separate accounts, exchange traded funds, and private investment funds.

A complete list and description of all composites and policies for valuing portfolios, calculating and reporting returns, and preparing presentations are available upon request. The composite results reflect the reinvestment of dividends, capital gains, and other earnings when appropriate. Composite returns and benchmark returns are presented gross of withholding taxes on dividends, interest income and capital gains. Returns are calculated using U.S. Dollars. Net returns are calculated by reducing the gross returns by either the actual client fee paid or the highest stated fee in the composite fee schedule, depending on the type of client and account, and are reduced by estimated accrued performance based fees where applicable. Only transaction costs are deducted from gross of fees returns.

The Small Cap Composite is comprised of discretionary fee paying non-wrap accounts managed according to the firm’s Small Cap equity strategy. The strategy’s investment objective is to achieve long-term capital appreciation by investing in small capitalization companies selling for less than our estimate of intrinsic value. The composite typically invests in small capitalization companies with a market capitalization between $100 million and $3 billion (or, if greater, the maximum market capitalization of companies generally within the capitalization range of the Russell 2000 Index) at the time of purchase.

The Small-Mid Cap Composite is comprised of discretionary fee paying non-wrap accounts managed according to the firm’s Small-Mid Cap equity strategy. The strategy’s investment objective is to achieve long-term capital appreciation by investing in small and medium capitalization companies selling for less than our estimate of intrinsic value. The composite typically invests in small and medium capitalization companies which are defined as those companies with a market capitalization between $500 million and $10 billion (or, if greater, the maximum market capitalization of companies generally within the capitalization range of the Russell 2500 Index) at the time of purchase.

The Mid Cap Composite is comprised of discretionary, fee-paying, non-wrap accounts managed according to the firm’s Mid Cap equity strategy.  The strategy’s investment objective is to achieve long-term capital appreciation by investing in medium market capitalization companies selling for less than our estimate of intrinsic value. Medium market capitalization companies are defined as those companies with a market capitalization between $1.5 and $20 billion (or, if greater, the maximum market capitalization of companies generally within the capitalization range of the Russell Midcap Index) at the time of purchase.

The Large Cap Composite is comprised of discretionary fee paying non-wrap accounts managed according to the firm’s Large Cap equity strategy. The strategy’s investment objective is to achieve long-term capital appreciation by investing in large capitalization companies selling for less than our estimate of intrinsic value. The composite typically invests in large capitalization companies, which are defined as companies with a market capitalization of $5 billion or greater. However, the composite can invest in companies with a market capitalization as low as $2.5 billion.

The Large Cap Concentrated Composite is comprised of discretionary fee paying non-wrap accounts managed according to the firm’s Large Cap Concentrated equity strategy. The strategy’s investment objective is to achieve long-term capital appreciation by investing in large capitalization companies selling for less than our estimate of intrinsic value. Holdings are derived from holdings in the Diamond Hill Large Cap strategy. The Large Cap strategy typically invests in large capitalization companies, which are defined as companies with a market capitalization of $5 billion or greater. However, the Large Cap strategy can invest in companies with a market capitalization as low as $2.5 billion.

The Select Composite is comprised of discretionary fee paying non-wrap accounts managed according to the firm’s Select equity strategy. The strategy’s investment objective is to achieve long-term capital appreciation by investing in companies selling for less than our estimate of intrinsic value. The strategy typically invests in securities with a market capitalization of $500 million or greater. The strategy’s Adviser anticipates that each of the strategy’s investments will also be held in one of the other Diamond Hill strategies.

The Core Bond Composite is comprised of discretionary non-fee and fee paying non-wrap accounts with a market value over $10M managed according to the firm’s Core Bond fixed income strategy. The strategy’s investment objective is to maximize total return with the preservation of capital by investing in a diversified portfolio of intermediate and long-term debt securities. The portfolio generally invests at least 80% of its assets in a diversified portfolio of investment grade, fixed income securities and may invest a significant portion or all of its assets in mortgage-related and mortgage-backed securities. The portfolio will typically maintain an average portfolio duration within 20% of the duration of the Bloomberg Barclays U.S. Aggregate Index.

The Corporate Credit Composite is comprised of discretionary fee paying non-wrap accounts with a market value over $10M managed according to the firm’s Corporate Credit fixed income strategy. The strategy’s investment objective is to provide an attractive cash distribution and total return greater than the current rate of inflation, while minimizing the risk of a current loss of capital over a five-year time horizon. The strategy generally invests in investment grade and below-investment grade (high yield) corporate bonds and will typically maintain an effective duration less than five.

The High Yield Composite is comprised of discretionary non-fee and fee paying non-wrap accounts with a market value over $10M managed according to the firm’s High Yield fixed income strategy. The strategy’s investment objective is to generate high current income with the opportunity for capital appreciation over a five-year time horizon. The strategy generally invests in corporate debt securities that are related below investment grade or are unrated.

The Russell 3000 Index is an unmanaged market-capitalization weighted index measuring the performance of the 3,000 largest U.S. companies based on total market capitalization. The Russell 3000 Value Index is an unmanaged market-capitalization weighted index measuring the performance of the broad value segment of the U.S. equity universe including those Russell 3000 Index companies with lower expected growth values. The Russell 1000 Index is an unmanaged market-capitalization weighted index measuring the performance of the 1,000 largest companies, on a market capitalization basis, in the Russell 3000 Index. The Russell 1000 Value Index is an unmanaged market-capitalization weighted index measuring the performance of the large cap value segment of the U.S. equity universe including those Russell 1000 Index companies with lower expected growth values. The Russell 2000 Index is an unmanaged market-capitalization weighted index measuring the performance of the 2,000 smallest U.S. companies, on a market capitalization basis, in the Russell 3000 Index. The Russell 2000 Value Index is an unmanaged market-capitalization weighted index measuring the performance of the small cap value segment of the U.S. equity universe including those Russell 2000 Index companies with lower expected growth values. The Russell 2500 Index is an unmanaged market-capitalization weighted index measuring the performance of the 2,500 smallest companies, on a market capitalization basis, in the Russell 3000 Index. The Russell 2500 Value Index is an unmanaged market-capitalization weighted index measuring the performance of the small and midcap value segment of the U.S. equity universe including those Russell 2500 Index companies with lower expected growth values. The Russell Midcap Index is an unmanaged market-capitalization weighted index measuring the performance of the 800 smallest companies, on a market capitalization basis, in the Russell 1000 Index. The Russell Midcap Value Index is an unmanaged market-capitalization weighted index measuring the performance of the mid cap value segment of the U.S. equity universe including those Russell Midcap Index companies with lower expected growth values. The Bloomberg Barclays U.S. Aggregate Index is an unmanaged index representing the U.S. investment grade fixed rate bond market, with index components for government and corporate securities, mortgage pass-through, and asset-backed securities.  The BofA Merrill Lynch U.S. Corporate & High Yield Index is comprised of U.S. dollar denominated investment grade and below investment grade corporate debt publicly issued in the U.S. domestic market. The BofA Merrill Lynch BB-B U.S. High Yield Index is a subset of The BofA Merrill Lynch U.S. High Yield Index including all securities rated BB1 through B3, inclusive. Ratings are based on an average of Moody’s, S&P and Fitch. The BofA Merrill Lynch U.S. High Yield Index is comprised of U.S. dollar denominated below investment grade corporate debt publicly issued in the U.S. domestic market. Our selection process may lead to portfolios that differ markedly from the benchmarks presented. Returns may be more volatile than, and/or may not be correlated to, these indices, which are for comparative purposes only.  The dispersion measure is the asset weighted standard deviation of the annual portfolio returns. Only portfolios represented in the composite for the entire year are included in the calculation. The calculation is not performed if the composite contains 5 or fewer accounts for the full year. The three year standard deviation is only presented beginning 2011 where 36 month returns are available.

The Firm’s standard fee schedule for separate accounts is as follows (fees are payable quarterly in arrears): SC-First $20,000,000 = 1.00%; Over $20,000,000 = 0.80%. SM-First $20,000,000 = 0.95%; Over $20,000,000 = 0.75%.  MC-First $20,000,000 = 0.80%; Over $20,000,000 = 0.65%. LC-First $20,000,000 = 0.60%; Over $20,000,000 = 0.50%. LCC-First $20,000,000 = 0.70%; Over $20,000,000 = 0.60%. SL-First $20,000,000 = 0.85%; Over $20,000,000 = 0.70%. CB – First $50,000,000 = 0.29%; Next $50,000,000 = 0.22%; Balance = 0.18%. CC- First $50,000,000 = 0.55%; Over $50,000,000 = 0.45%. HY – First $50,000,000 = 0.60%; Over $50,000,000 = 0.50%.

Total end of period managed assets for Diamond Hill Capital Management, Inc. were $16.8 billion in 2015, $15.7 billion in 2014, $12.2 billion in 2013, $9.4 billion in 2012, $8.7 billion in 2011, $8.6 billion in 2010, $6.3 billion in 2009; $4.5 billion in 2008; $4.4 billion in 2007; $3.7 billion in 2006.

As of 12/31/15, the Small Cap Composite included 5 or fewer accounts with $1.7 billion in assets; the Small-Mid Cap Composite included 12 accounts with $1.9 million in assets; the Mid Cap Composite included 5 or fewer accounts with $18.6 million in assets; the Large Cap Composite included 180 accounts with $5.8 billion in assets; the Large Cap Concentrated Composite included 5 or fewer with $418.9 million in assets; the Select Composite included 13 accounts with $466.5 million in assets; the Corporate Credit Composite included 5 or fewer accounts with $299.0 million in assets; the High Yield Composite included 5 or fewer accounts with $10.1 million in assets.

As of 12/31/14, the Small Cap Composite included 6 accounts with $1.5 billion in assets; the Small-Mid Cap Composite included 11 accounts with $1.1 million in assets; the Mid Cap Composite included 5 or fewer accounts with $16.3 million in assets; the Large Cap Composite included 155 accounts with $5.8 billion in assets; the Large Cap Concentrated Composite included 5 or fewer with $422.6 million in assets; the Select Composite included 13 accounts with $374.9 million in assets; the Corporate Credit Composite included 5 or fewer accounts with $220.0 million in assets.

As of 12/31/13, the Small Cap Composite included 7 accounts with $1.4 billion in assets; the Small-Mid Cap Composite included 9 accounts with $586.7 million in assets; the Large Cap Composite included 132 accounts with $4.2 billion in assets; the Large Cap Concentrated Composite included 5 or fewer with $382.3 million in assets; the Select Composite included 14 accounts with $277.8 million in assets; the Corporate Credit Composite included 5 or fewer accounts with $186.7 million in assets.

As of 12/31/12, the Small Cap Composite included 16 accounts with $911.6 million in assets; the Small-Mid Cap Composite included 6 accounts with $233.7 million in assets; the Large Cap Composite included 135 accounts with $3.7 billion in asset; the Large Cap Concentrated Composite included 5 or fewer with $275.9 million in assets; the Select Composite included 18 accounts with $227.2 million in assets; the Corporate Credit Composite included 5 or fewer accounts with $178.4 million in assets.

As of 12/31/11, the Small Cap Composite included 16 accounts with $910.2 million in assets; the Small-Mid Cap Composite included 6 accounts with $189.2 million in assets; the Large Cap Composite included 129 accounts with $3.5 billion in assets; the Select Composite included 26 accounts with $284.9 million in assets; the Corporate Credit Composite included 5 or fewer accounts with $146.0 million in assets.

As of 12/31/10, the Small Cap Composite included 19 accounts with $938.0 million in assets; the Small-Mid Cap Composite included 6 accounts with $97.2 million in assets; the Large Cap Composite included 123 accounts with $3.2 billion in assets; the Select Composite included 28 accounts with $189.0 million in assets; the Corporate Credit Composite included 5 or fewer accounts with $145.8 million in assets.

As of 12/31/09, the Small Cap Composite included 18 accounts with $621.2 million in assets; the Small-Mid Cap Composite included 6 accounts with $64.1 million in assets; the Large Cap Composite included 106 accounts with $1.5 billion in assets; the Select Composite included 29 accounts with $155.0 million in assets; the Corporate Credit Composite included 5 or fewer accounts with $127.6 million in assets.

As of 12/31/08, the Small Cap Composite included 11 accounts with $391.2 million in assets; the Small-Mid Cap Composite included 8 accounts with $47.9 million in assets; the Large Cap Composite included 108 accounts with $792.5 million in assets; the Select Composite included 35 accounts with $83.3 million in assets; the Corporate Credit Composite included 5 or fewer accounts with $112.8 million in assets.

As of 12/31/07, the Small Cap Composite included 9 accounts with $383.4 million in assets; the Small-Mid Cap Composite included 9 accounts with $70.4 million in assets; the Large Cap Composite included 96 accounts with $764.2 million in assets; the Select Composite included 36 accounts with $102.2 million in assets; the Corporate Credit Composite included 5 or fewer accounts with $206.1 million in assets.

As of 12/31/06, the Small Cap Composite included 9 accounts with $525.8 million in assets; the Small-Mid Cap Composite included 5 or fewer accounts with $34.1 million in assets; the Large Cap Composite included 42 accounts with $672.7 million in assets; the Select Composite included 34 accounts with $126.3 million in assets; the Corporate Credit Composite included 5 or fewer accounts with $203.9 million in assets.

The calendar year dispersion, gross of fees, for each composite is as follows – Small Cap: 0.02% in 2015; 0.03% in 2014; 0.74% in 2013; 0.20% in 2012; 0.11% in 2011, 0.24% in 2010; 0.61% in 2009; 0.32% in 2008; 0.14% in 2007; 0.44% in 2006; Small-Mid Cap: 0.17% in 2015; 0.13% in 2014; 0.39% in 2013; 0.10% in 2012; 0.05% in 2011; 0.16% in 2010: 1.20% in 2009; 0.53% in 2008; 0.15% in 2007; Large Cap: 0.30% in 2015; 0.10% in 2014; 0.24% in 2013; 0.24% in 2012; 0.21% in 2011, 0.22% in 2010; 0.64% in 2009; 0.86% in 2008; 0.44% in 2007; 0.75% in 2006; Select: 0.16% in 2015; 0.07% in 2014; 0.24% in 2013; 0.16% in 2012; 0.42% in 2011; 0.48% in 2010; 0.97% in 2009; 0.82% in 2008; 0.32% in 2007; 0.75% in 2006.

As of December 31, 2015, the three-year standard deviation, calculated gross of fees, for the Small Cap Composite was 10.58%, the Russell 2000 Index was 13.96% and the Russell 2000 Value Index was 13.46%; for the Small-Mid Cap Composite was 11.09%, the Russell 2500 Index was 12.42% and the Russell 2500 Value Index was 12.02%; for the Large Cap Composite was 11.83%, the Russell 1000 Index was 10.48% and the Russell 1000 Value Index was 10.68%; %; for the Large Cap Concentrated Composite was 12.07%, the Russell 1000 Index was 10.48% and the Russell 1000 Value Index was 10.68%; for the Select Composite was 11.66%, the Russell 3000 Index was 10.58%, and the Russell 3000 Value Index was 10.74%; for the Corporate Credit Composite was 2.91%, the BofA Merrill Lynch U.S. Corporate & High Yield Index was 3.82% and the BofA Merrill Lynch BB-B U.S. High Yield Index was 5.08%.

As of December 31, 2014, the three-year standard deviation, calculated gross of fees, for the Small Cap Composite was 10.62%, the Russell 2000 Index was 13.12% and the Russell 2000 Value Index was 12.79%; for the Small-Mid Cap Composite was 11.20%, the Russell 2500 Index was 11.67% and the Russell 2500 Value Index was 11.25%; for the Large Cap Composite was 9.53%, the Russell 1000 Index was 9.12% and the Russell 1000 Value Index was 9.20%; %; for the Large Cap Concentrated Composite was 9.29%, the Russell 1000 Index was 9.12% and the Russell 1000 Value Index was 9.20%; for the Select Composite was 10.56%, the Russell 3000 Index 9.29%, and the Russell 3000 Value Index was 9.39; for the Corporate Credit Composite was 2.37%, the BofA Merrill Lynch U.S. Corporate & High Yield Index was 3.79% and the BofA Merrill Lynch BB-B U.S. High Yield Index was 4.26%.

As of December 31, 2013, the three-year standard deviation, calculated gross of fees, for the Small Cap Composite was 13.63%, the Russell 2000 Index was 16.45% and the Russell 2000 Value Index was 15.82%; for the Small-Mid Cap Composite was 14.51%, the Russell 2500 Index was 15.63% and the Russell 2500 Value Index was 15.07%; for the Large Cap Composite was 12.48%, the Russell 1000 Index was 12.26% and the Russell 1000 Value Index was 12.70%; for the Select Composite was 13.39%, the Russell 3000 Index 12.53%, and the Russell 3000 Value Index was 12.90%; for the Corporate Credit Composite was 3.32%, the BofA Merrill Lynch U.S. Corporate & High Yield Index was 4.34% and the BofA Merrill Lynch BB-B U.S. High Yield Index was 5.79%.

As of December 31, 2012, the three-year standard deviation, calculated gross of fees, for the Small Cap Composite was 15.71%, the Russell 2000 Index was 20.20%, and the Russell 2000 Value Index was 19.89%; for the Small-Mid Cap Composite was 16.13%, the Russell 2500 Index was 18.97% and the Russell 2500 Value Index was 18.41%; for the Large Cap Composite was 14.42%, the Russell 1000 Index was 15.41% and the Russell 1000 Value Index was 15.51%; for the Select Composite was 14.48%, the Russell 3000 Index was 15.73% and the Russell 3000 Value Index was 15.81%; for the Corporate Credit Composite was 3.80%, the BofA Merrill Lynch U.S. Corporate & High Yield Index was 4.00% and the BofA Merrill Lynch BB-B U.S. High Yield Index was 6.21%.

As of December 31, 2011, the three-year standard deviation, calculated gross of fees, for the Small Cap Composite was 21.46%, the Russell 2000 Index was 24.99% and the Russell 2000 Value Index was 26.05%; for the Small-Mid Cap Composite was 24.12%, the Russell 2500 Index was 23.40% and the Russell 2500 Value Index was 24.23%; for the Large Cap Composite was 18.88%, the Russell 1000 Index was 18.95% and the Russell 1000 Value Index was 20.69%; for the Select Composite was 18.81%, the Russell 3000 Index was 19.35% and the Russell 3000 Value Index was 21.04%; for the Corporate Credit Composite was 7.10%, the BofA Merrill Lynch U.S. Corporate & High Yield Index was 5.73% and the BofA Merrill Lynch BB-B U.S. High Yield Index was 9.22%.

The Small Cap, Small-Mid Cap, Large Cap and Select Composite were created in October 2013. The Mid Cap Composite was created in December 2013. The Large Cap Concentrated Composite was created December 2011. The Core Bond Composite was created in July 2016. The Corporate Credit Composite was created in April 2015. The High Yield Composite was created in January 2016.

As of February 28, 2016, the Strategic Income Composite was renamed the Corporate Credit Composite.

No alteration of composites as presented here has occurred because of changes in personnel at any time. Past performance is not a guarantee of future results.