Diamond Hill Long-Short Fund Class I (DHLSX)

Overview

The company described operates as a mutual fund, focusing its investment strategy on identifying undervalued and overvalued U.S. equity securities across all size capitalizations. The fund's approach is distinctive because it seeks to determine a company's value independently of its current stock price, suggesting a fundamental analysis framework is at its core. To capitalize on perceived market inefficiencies, the fund not only invests in securities it believes are undervalued but also actively engages in short selling. Short selling is a technique used when the fund's advisers believe that a stock is overvalued and that its price will decline in the future. This method involves selling borrowed securities in anticipation of buying them back at a lower cost. This dual strategy aims to generate returns from both market undervaluations and overvaluations, reflecting a sophisticated and potentially higher-risk approach to asset management.

Products and Services

• Investment in Undervalued U.S. Equities

The fund allocates its assets towards purchasing U.S. equity securities which its Adviser believes are undervalued in the market. This involves a rigorous process of estimating a company’s true value independently of its market price and identifying potential investment opportunities that the market may have overlooked.

• Short Selling Overvalued U.S. Equities

In contrast to traditional investment strategies, the fund adopts a proactive approach by engaging in short selling. This involves borrowing securities believed to be overvalued based on current market prices and selling them with the aim of buying them back at a lower price in the future. This strategy is predicated on the adviser's analysis and conviction that certain securities' prices will decline, allowing the fund to profit from these anticipated decreases.