Small/Mid Cap Value Strategy

OVERVIEW

Baird Equity Asset Management’s Small/Mid Cap Value portfolio invests in small- to medium-cap U.S. companies and seeks to provide superior risk-adjusted returns and consistently outperform the benchmark Russell 2500 Value Index over a full market cycle (typically 3–5 years). The portfolio comprises companies we expect to exceed street expectations and that trade at discounts to our proprietary calculations of fair value. To help control risks, the portfolio is generally diversified among companies in a broad range of industries and economic sectors.

Portfolio Construction

  • A concentrated portfolio of generally 40–50 stocks
  • A market cap range typically from $300 million to $10 billion at purchase 
  • Top holdings generally limited to 5% at cost, 8% at market
  • Sectors capped at 30% excluding financials 
  • Buy-and-hold approach
TEAM

For more information, contact Rob Zwiebel or the Intermediary Specialist in your region.

COMMENTARY

Q1 2019 Small/Mid Value and Small Value Commentary

It’s no secret that we have a strong bias toward the smaller end of the market capitalization spectrum. Our preference is grounded in the intuitive proposition that the market is more inefficient when it comes to forecasting profitability for smaller business, thus presenting outsized opportunities. We also adhere to the discipline of buying stocks at a discount to intrinsic value, which we believe offers both superior returns and downside protection. The long term returns of domestic equities over the past 90 years have validated our view.

Read Full Small or Small/Mid Value Commentary

PERFORMANCE

Annualized Returns (%)*

 3 MonthsYTD1-Year3-Year5-Year10-YearSince InceptionInception Date
Baird Small/Mid Cap Value (gross) 11.18 11.18 -3.01 8.45 6.27 13.93 11.13 1/1/00
Baird Small/Mid Cap Value (net) 10.99 10.99 -3.78 7.54 5.43 12.99 10.16 1/1/00
Russell 2500 Value Index 13.12 13.12 1.84 9.85 6.02 15.03 9.6

*Returns less than one year are not annualized.



Annual Total Returns (%)

201820172016201520142013201220112010200920082007
Baird Small/Mid Cap Value (gross)  -14.51 22.55 9.80 0.17 9.47 36.87 17.32 6.09 10.29 29.40 -38.74 24.22
Baird Small/Mid Cap Value (net) -15.22  21.54 8.91 -0.50 8.65 35.93 16.36 5.09 9.26 28.20 -39.34 23.06
Russell 2500 Value Index -12.36  10.36 25.20 -5.49 7.11 33.32 19.21 -3.36 24.80 27.68 -31.98 -7.27

Data as of 3/31/19


Past performance does not guarantee future results.