Ariel’s flagship value approach is built on the principle of targeting undervalued small- and mid-cap companies that show a strong potential for growth.
Past performance is not indicative of future results. An investment’s return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. All performance assumes the reinvestment of dividends and capital gains. Personal investors may also call 800-292-7435, Option 1, and institutional investors may contact 800-725-0140. Further disclosures and definitions related to the data above can be found at the bottom of this webpage.
We seek value amongst small- and medium-sized companies that are widely misunderstood, ignored and/or underfollowed. We want to own durable franchises with significant barriers-to-entry led by skilled management teams when their shares are mispriced.
Waiting for the Perfect Pitch
First, we find the businesses we want to own and then we patiently wait for the right entry price—one with an ample margin of safety.* Years of diligent research often culminate in a moment of action. Since value can be fleeting, we must be ready to pounce. By exploiting the dislocations that arise from short-term thinking, we drive long-term returns. We aim to arbitrage time.
Focusing on ESG
Maximizing shareholder returns is more than just math. Environmental, social and governance issues have long been fully integrated throughout our investment process. We view management teams as business partners and seek to encourage sustainable long-term value creation.
Looking Over the Horizon
Getting swept up in the euphoria or misery of the market can lead to emotional decisions and bad outcomes. Our job is to drown out the noise and think long-term. As disciplined, value investors, we look past today’s turbulence to see tomorrow’s possibilities.
*Attempting to purchase a stock with a margin of safety does not protect investors from the loss of their investment, volatility associated with stocks, declining fundamentals, external forces, or our incorrect assumptions.
Our contrarian views result from meticulous, fundamental bottom-up research.
We embrace
Active patience
Long investment horizon
Lower turnover
Margin of safety*
Independent thinking
Contrarian point of view
Benchmark agnostic
Volatility equals opportunity
Focused expertise
Small- and mid-cap value specialists
Deep industry knowledge
Bottom-up stock selection
Go anywhere approaches
Thematic investing
Macro-economic prognostications
Individualism
Job hoppers
Smartest in the room mentality
Winner takes all
Elitism
*Attempting to purchase a stock with a margin of safety does not protect investors from the loss of their investment, volatility associated with stocks, declining fundamentals, external forces, or our incorrect assumptions.
Our Investment Process
Investment universe clearly defined
Analysts specialize
Proprietary watchlist honed
Portfolio company executives queried
Business model and valuation studied
Investment hypothesis established
Devil’s advocate consulted
ESG issues identified
Preliminary report generated
Industry assessed/reassessed
Company scrutinized
Valuation models created/updated
Proprietary debt rating assigned/reviewed
ESG rating determined
Company management questioned
Comprehensive research report created
Investment thesis debated
Critical issues considered
Downside risk contemplated and quantified
Additional channel checks conducted
These portfolio construction practices may vary and are subject to change.
Portfolio managers make final buy and sell decisions
Top 10 Positions
(as of 09/30/2024)
Top 10 Positions Table for Ariel Fund
Company
Ending Weight (%)
1. Mohawk Industries, Inc. (MHK)
4.6
2. Madison Square Garden Entertainment Corporation (MSGE)
4.3
3. Adtalem Global Education, Inc. (ATGE)
3.7
4. Northern Trust Corporation (NTRS)
3.7
5. Affiliated Managers Group, Inc. (AMG)
3.7
6. Lazard, Inc. (LAZ)
3.6
7. Royal Caribbean Cruises, Ltd. (RCL)
3.6
8. Boyd Gaming Corporation (BYD)
3.6
9. J.M. Smucker Company (SJM)
3.5
10. Jones Lang LaSalle, Inc. (JLL)
3.5
Ending Weight is the value of the holding relative to the portfolio’s total assets as of the report date. Additional disclosures related to the data above can be found at the bottom of this page.
Industry Weightings
Weightings table for Ariel Fund
(as of 09/30/2024)
(as of 09/30/2024)
Ending Weight (%)
Russell 2500™ Value Index (%)
Russell 2500™ Index (%)
S&P 500® Index (%)
Consumer Discretionary
Ending Weight (%)
37.14
Russell 2500™ Value Index (%)
14.44
Russell 2500™ Index (%)
14.84
S&P 500® Index (%)
13.79
Industrials
Ending Weight (%)
21.72
Russell 2500™ Value Index (%)
21.47
Russell 2500™ Index (%)
21.83
S&P 500® Index (%)
11.81
Financials
Ending Weight (%)
21.05
Russell 2500™ Value Index (%)
19.21
Russell 2500™ Index (%)
15.48
S&P 500® Index (%)
10.12
Health Care
Ending Weight (%)
10.21
Russell 2500™ Value Index (%)
8.28
Russell 2500™ Index (%)
12.80
S&P 500® Index (%)
11.16
Consumer Staples
Ending Weight (%)
3.53
Russell 2500™ Value Index (%)
3.00
Russell 2500™ Index (%)
2.82
S&P 500® Index (%)
4.55
Real Estate
Ending Weight (%)
3.48
Russell 2500™ Value Index (%)
10.30
Russell 2500™ Index (%)
7.35
S&P 500® Index (%)
2.34
Energy
Ending Weight (%)
2.33
Russell 2500™ Value Index (%)
5.40
Russell 2500™ Index (%)
4.96
S&P 500® Index (%)
3.40
Basic Materials
Ending Weight (%)
0.00
Russell 2500™ Value Index (%)
4.16
Russell 2500™ Index (%)
3.83
S&P 500® Index (%)
1.53
Technology
Ending Weight (%)
0.00
Russell 2500™ Value Index (%)
7.57
Russell 2500™ Index (%)
11.33
S&P 500® Index (%)
36.38
Telecommunications
Ending Weight (%)
0.00
Russell 2500™ Value Index (%)
2.20
Russell 2500™ Index (%)
1.78
S&P 500® Index (%)
2.14
Utilities
Ending Weight (%)
0.00
Russell 2500™ Value Index (%)
3.98
Russell 2500™ Index (%)
2.98
S&P 500® Index (%)
2.77
Short-Term Investments
Ending Weight (%)
0.23
Russell 2500™ Value Index (%)
0.00
Russell 2500™ Index (%)
0.00
S&P 500® Index (%)
0.00
Disclosures related to the data above can be found at the bottom of this page.
The following disclosures provide definitions relevant to the Key Facts / General Information about this Product, its Performance tables, Top 10 Positions tables, and Industry or Sector Weightings data tables shown above.
Investing in small cap and mid-cap stocks is more risky and more volatile than investing in large cap stocks. The intrinsic value of the stocks in which the Fund invests may never be recognized by the broader market. Ariel Fund is often concentrated in fewer sectors than its benchmarks, and its performance may suffer if these sectors underperform the overall stock market. Investing in equity stocks is risky and subject to the volatility of the markets.
Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted.
Indexes are unmanaged. An investor cannot invest directly in an index.
The Russell 2500™ Value Index measures the performance of the small to mid-cap value segment of the U.S. equity universe. It includes those Russell 2500 companies with relatively lower price-to-book ratios, lower forecasted growth values and lower sales per share historical growth. Its inception date is July 1, 1995.
The Russell 2500™ Index measures the performance of the small to mid-cap segment of the U.S. equity universe, commonly referred to as “smid” cap. The Russell 2500 Index is a subset of the Russell 3000® Index. It includes approximately 2500 of the smallest securities based on a combination of their market cap and current index membership. Its inception date is June 1, 1990.
Russell® is a trademark of London Stock Exchange Group, which is the source and owner of the Russell Indexes’ trademarks, service marks and copyrights. Neither Russell nor its licensors accept any liability for any errors or omissions in the Russell Indexes or underlying data and no party may rely on any Russell Indexes and/or underlying data contained in this communication. No further distribution of Russell data is permitted without Russell’s express written consent. Russell does not promote, sponsor or endorse the content of this communication.
The S&P 500® Index is widely regarded as the best gauge of large-cap U.S. equities. It includes 500 leading companies and covers approximately 80% of available U.S. market capitalization. Its inception date is March 4, 1957.
Ending Weight is the value of the holding relative to the portfolio’s total assets as of the report date.
