TCW | Gargoyle Hedged Value Fund

At-A-Glance

Ticker Symbol
Daily NAV

Investment Team

  • Joshua B. Parker
  • Alan L. Salzbank

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Portfolio Manager Josh Parker discusses the TCW | Gargoyle Hedged Value Fund

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Fund Name Daily NAV1 Daily1 MTD1 YTD1 Latest 3 Months2
Annualized Performance
1-yr
3-yr3 5-yr3 10-yr3 Since Inc3
Expense Ratio
Net
Gross
TCW | Gargoyle Hedged Value Fund I
[Inception Date: 12/31/1999]
$9.16 0.33% 0.02% 2.58% -4.76% 6.32% -1.81% 8.15% 3.50% 7.32% 1.25% 2.19%
TCW | Gargoyle Hedged Value Fund N
[Inception Date: 12/31/1999]
$9.21 0.44% 0.02% 2.45% -4.84% 6.00% -2.04% 7.89% 3.38% 7.25% 1.50% 2.51%
S & P 500 Index - - - - 2.57% 17.47% 10.14% 15.42% 6.94% 4.90% - -
S & P 500 Index - - - - 2.57% 17.47% 10.14% 15.42% 6.94% 4.90% - -
1 as of 06/23/17 (updated daily)
2 Performance as of 05/31/2017 (updated monthly)
3 Returns include the performance of the predecessor limited partnership for periods
before the Fund’s registration became effective. The predecessor limited partnership
was not registered under the Investment Company Act of 1940 (“1940 Act”) and
therefore was not subject to certain investment restrictions imposed by the 1940 Act.
If the limited partnership had been registered under the 1940 Act, its performance
may have been adversely affected.

Click here for detailed Quarterly/Monthly Performance

Investment Objective

The Fund’s investment objective is to seek long-term capital appreciation with lower volatility than a stand-alone stock portfolio.

Investment Strategy

The TCW | Gargoyle Hedged Value Fund seeks to purchase undervalued stocks and hedge part of the stock market risk by selling a blend of index call options. By combining a short call option strategy to its long equity portfolio, the Fund believes it can increase the Fund’s income, reduce the volatility of its returns and, in general, improve the reward/risk of the stock portfolio. Proprietary tools are used in an effort to maintain the Fund's net long market exposure within a target range so that investors participate as equities are trending higher and are partially protected as equities are trending lower.

As of March 31, 2017

 
Source: TCW Portfolio Analytics, Factset
Portfolio characteristics and holdings are subject to change at any time. It should not be assumed that an investment in the securities listed was or will be profitable. Sector allocation is the equity exposure, excluding cash.

Performance Returns

as of 05/31/2017 (updated monthly)

Legal Disclosures


The source for all charts and tables above is TCW
GLOSSARY OF TERMS

Index Call Option – An index option is the same as an equity or stock option, except the underlying asset is an index instead of a stock. Just like an equity call option, an index call option is the right to buy the underlying index. And just like an equity put option, an index put option is the right to sell the underlying index. Index options are cash settled, whereas individual stock options or settled using the underlying stock.

Long Position – Buying of a security or currency, with the expectation that the asset will rise in value; In the context of options, the buying of an options contract.

Short Position – The sale of a borrowed security, commodity or currency with the expectation that the asset will fall in value; In the context of options, it is the sale (also known as "writing") of an options contract. 

Exercise Price – The price at which the underlying security can be purchased (call option) or sold (put option). The exercise price is determined at the time the option contract is formed.

About Performance

The performance data presented represents past performance and is no guarantee of future results. Total returns include reinvestment of dividends and distributions. Current performance may be lower or higher than the performance data presented. Performance data current to the most recent month end is available on the Fund’s website at TCW.com. Investment returns and principal value will fluctuate with market conditions. The value of an investment in the Fund, when redeemed, may be worth more or less than its original purchase cost. The Fund offers another class, the performance for which will vary due to fees and expenses.

Performance information shown prior to July 13, 2015 is that of the institutional class shares of the predecessor mutual fund. The Fund charges the same management fee as the predecessor mutual fund and the Fund's total operating expenses after fee waiver or expense reimbursement will be the same as those of the predecessor mutual fund. If the predecessor mutual fund were charged the same fees and expenses of the Fund, the annual returns for the predecessor mutual fund would have been the same. Performance information shown prior to April 30, 2012 is for the predecessor mutual fund's predecessor limited partnership (Gargoyle Hedged Value Fund L.P.), a private partnership with one class of units. The predecessor limited partnership was merged into and reorganized as the predecessor mutual fund as of April 30, 2012. The merger and reorganization of the predecessor limited partnership into the predecessor mutual fund was for purposes entirely unrelated to the establishment of a performance record. The predecessor mutual fund was managed by the same investment adviser (i.e., its sub-adviser, Gargoyle Investment Advisor L.L.C.) and in a manner that was in all material respects equivalent to the management of the predecessor limited partnership since December 31, 1999. The predecessor limited partnership was formed and commenced operations in 1997; however, substantial changes were made to the strategy in January 2000, consistent with the strategy that the predecessor mutual fund pursued. Data presented since inception is measured from this December 31, 1999 date. Performance is presented for the predecessor limited partnership from December 31, 1999 to April 30, 2012 net of a 1% annual management fee and a 20% performance fee, brokerage commissions and other expenses, and includes the reinvestment of dividends, interest, and other earnings, and for the predecessor mutual fund, which had one class of units, from April 30, 2012 to July 13, 2015, net of operating expenses as described in the predecessor mutual fund's prospectus. During its operating history since December 31, 1999, the predecessor limited partnership's investment policies, objectives, guidelines and restrictions were in all material respects equivalent to the predecessor mutual fund's. The information for periods prior to April 30, 2012 shows how the predecessor limited partnership's performance varied from year to year, and reflects the actual fees and expenses that were charged when the predecessor mutual fund was a partnership. When the predecessor mutual fund was a partnership, it charged a 1% annual management fee and investors a 20% performance fee. The predecessor mutual fund did not charge a performance fee. If the predecessor limited partnership were charged the same fees and expenses as the predecessor mutual fund, the annual returns for the predecessor limited partnership would have been higher. From its inception through April 30, 2012, the predecessor limited partnership was not subject to certain investment restrictions, diversification requirements and other restrictions of the Investment Company Act of 1940, as amended, or the Internal Revenue Code of 1986, as amended, which if they had been applicable, might have adversely affected its performance. The Fund has only adopted the financial statements of the predecessor mutual fund since it has been a registered investment company and not its financial statements as an unregistered partnership. Annual performance returns provide some indication of the risks of investing in the Fund by showing changes in performance from year to year. Comparison of performance to an appropriate index indicates how the Fund's, the predecessor mutual fund's and the predecessor limited partnership's average annual returns compare with those of a broad measure of market performance. The predecessor mutual fund's and the predecessor limited partnership's past performance is not necessarily an indication of how the Fund will perform in the future. Past performance is no guarantee of future results.

Net and Gross Expense Ratio

Annual fund operating expenses as stated in the Prospectus dated February 28, 2017.

TCW Investment Management Company, the Fund’s Investment Adviser, has contractually agreed to waive fees and/or reimburse expenses to limit the Fund’s total annual operating expenses (excluding taxes, interest, brokerage commissions, dividends on securities sold short, acquired fund fees and expenses, and extraordinary expenses) to 1.25% of average daily net assets with respect to Class I shares and 1.50% of average daily net assets with respect to Class N shares.

This contractual fee waiver/expense reimbursement will remain in place through March 1, 2018. During this term, only the Board may terminate or modify the terms of the contract. The Adviser may request recoupment of previously waived fees and paid expenses from the Fund for three years from the date they were waived or paid, subject to any applicable expense caps at the time of recoupment or at the time of waiver and/or reimbursement, whichever is lower.


S&P 500 Index – A capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.


The index is not available for direct investment; therefore its performance does not reflect a reduction for fees or expenses incurred in managing a portfolio. The securities in the index may be substantially different from those in the Fund.

A Word About Risk

Equity investments entail equity risk and price volatility risk. The value of stocks and other equity securities will change based on changes in a company’s financial condition and in overall market and economic conditions.

The investment strategies employed by the Fund are alternative strategies that have not been applied to mutual funds for an extended period of time. Accordingly, the Fund is subject to the risk that anticipated opportunities do not play out as planned, or that there are unexpected challenges in implementing the Fund’s strategies due to regulatory constraints for mutual funds.

As the writer of an index call option, the Fund forgoes, during the option’s life, the opportunity to profit from increases in the market value of the index covering the call option above the exercise price of the call option. Since the Fund’s investment strategy does not contemplate investing in or replicating a particular index, the Fund will not profit from increases in market value of a particular index. Therefore, selling index call options also can limit the Fund’s opportunity to profit from an increase in the market value of the Stock Portfolio; however, only to the extent that the Stock Portfolio correlates with the index underlying the call option written by the Fund.

As part of its investment strategy, the Fund sells index call options to hedge the Stock Portfolio. There is the risk that the returns of the Stock Portfolio do not correlate with those of the indexes on which the call options are written. Further, the Sub-Adviser may not correctly assess the degree of correlation between the performance of the basket of indexes used in the hedging strategy and the performance of the equity securities in the Stock Portfolio being hedged. It is also not possible to hedge fully or perfectly against any risk, and hedging entails its own costs.
Obtain a Prospectus
You should consider the investment objectives, risks, charges and expenses of a mutual fund carefully before investing. A Fund’s Prospectus and Summary Prospectus contain this and other information about the Fund. To receive a Prospectus, please call 866-858-4338 or you may download the PDF Funds Prospectus from the Fund's website at TCW.com. Please read it carefully. Past performance is no guarantee of future results.

The TCW Alternative Funds are distributed by TCW Funds Distributors

Investment Team

  • Photo: Joshua B. Parker
    Joshua B. Parker
    Portfolio Manager

    Mr. Parker is a portfolio manager for the TCW|Gargoyle Hedged Value Fund and is a Co-Founder of Gargoyle Investment Advisor L.L.C. He has been a Managing Partner of the Gargoyle Group for 15 years. His 32-year career in finance has spanned hedge fund and portfolio management, options trading, and legal and regulatory compliance. He is a graduate of the New York University School of Law and Yale University.

  • Photo: Alan L. Salzbank
    Alan L. Salzbank
    Portfolio Manager

    Mr. Salzbank is a portfolio manager for the TCW|Gargoyle Hedged Value Fund and is a Co-Founder of Gargoyle Investment Advisor L.L.C. He has been a Managing Partner of the Gargoyle Group for 15 years. Mr. Salzbank has specialized in hedge fund and portfolio management for the past 16 years of his 38-year career in finance. He is a graduate of the Wharton School of the University of Pennsylvania and the New York University Stern School of Business.

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