Portfolio Guidelines

  • Typically 40–60 positions
  • Maximum position size is 7%
  • Top 10 holdings are typically greater than 30% of net assets
  • Maximum industry exposure is 20%
  • Maximum sector exposure is 30%

Market Capitalization

The portfolio typically invests at least 80% of its net assets in medium market capitalization
companies, defined as those companies with a market capitalization between $1.5 billion 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.

Top Ten Equity Holdings As Of September 30, 2016

Willis Towers Watson PLC | Financials 5.3%
Cimarex Energy Co. | Energy 3.7
Loews Corp. | Financials 3.1
LifePoint Health, Inc. | Health Care 3.0
Whirlpool Corp. | Cons. Discretionary 2.8
Boston Scientific Corp. | Health Care 2.8
Post Holdings, Inc. | Consumer Staples 2.6
BorgWarner, Inc. | Cons. Discretionary 2.5
Axalta Coating Systems Ltd. | Materials 2.5
BankUnited, Inc. | Financials 2.5
Total As % Of Net Assets 30.7%
Total Number Of Equity Holdings 59

This is presented as supplemental information.

Sector Allocation1 As Of September 30, 2016

This is presented as supplemental information.

Diamond Hill makes its own sector and industry classifications. On occasion, these classifications may differ from those used by other sources, which could result in differences in contribution analysis.

Portfolio Characteristics Vs. Benchmark2 As Of September 30, 2016

Mid Cap Composite Russell Midcap Index Russell Midcap Value Index
Median Forward P/E 17.2x 19.4x 18.4x
Median Trailing P/E 18.6x 22.6x 20.7x
Weighted Average Dividend Yield 1.3% 1.8% 2.4%
Median Price / Book 2.3x 2.8x 2.2x
Median Price / Sales 1.7x 2.1x 1.9x
Median Market Cap. $7.1B $6.3B $6.0B
Weighted Average Market Cap. $10.0B $12.6B $12.2B
Portfolio Turnover 5 Year 16% —   —  
Active Share3 vs. Core4 / Value5 Benchmark 94% / 92% —   —  
Upside/Downside Capture Ratio6 vs. Core Benchmark4 91% / 86% —   —  
Upside/Downside Capture Ratio6 vs. Value Benchmark5 91% / 91% —   —  

This is presented as supplemental information.

1 Sectors based on GICS classifications. Cash & Other may include cash, treasuries, money market funds, and short duration fixed income funds

2 Source: FactSet.

3 Source: Morningstar Direct. Active share measures the difference between portfolio holdings and the benchmark. The higher the active share, the greater the difference.

4 The Russell Midcap Index is the core benchmark.

The Russell Midcap Value Index is the value benchmark.

Source: eVestment Analytics based on quarterly returns (gross of fees) from 1/1/14 – 9/30/16.