TCW Relative Value Large Cap Strategy

Quarterly Commentary

March 31, 2018

Key Issues

  • U.S. equities began the year with a strong showing buoyed by strong synchronized global growth and indications the U.S. tax cuts, signed into law on December 22, will add to already noticeably higher corporate earnings in 2018. However, starting late in January, volatility picked up with concerns of rising inflation fueled by the January Bureau of Labor Statistics (BLS) report that stated Average Hourly Earnings (AHE) climbed to 2.9% year-over-year from a range of 2.3-2.5% and several March tariff pronouncements based on national security grounds and Trump’s “America first” campaign. After reaching an all-time high on January 26, the S&P 500 fell by 10% by the close of business February 8, recouping most of that loss by March 9, and then retesting lows in the last week of the quarter...

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Media Attachments

For Information Only

This publication is for general information purposes only and is not intended  to offer investment advice or be the basis for an investment decision.

Not An Offer

Nothing in this document constitutes an offer to sell or the solicitation of an offer to buy securities. Investing in any strategy has risks.

Price Volatility

Investing in any strategy has risks. An account is subject to price volatility. The value of an account’s portfolio will change as the prices of its investments go up or down. Before embarking on the described investment program, an investor should carefully consider the risks and suitability of the described strategy based on their own investment objectives and financial position. The strategy will not invest in initial public offerings.

Forward Looking Statement

The information contained herein may include estimates, projections and other “forward-looking statements.” Actual events may differ substantially from those presented herein. TCW assumes no duty to update any such forward-looking statements or any other information or opinions in this document. TCW makes no representation that future investment performance will conform to past performance and it should never be assumed that past performance foretells future performance. TCW's portfolio managers make investment decisions based on various sources of information and analysis and are not necessarily based on the economic information set forth herein.

Past Performance

TCW makes no representation that future investment performance will conform to past performance and it should never be assumed that past performance foretells future performance. TCW's portfolio managers make investment decisions based on various sources of information and analysis and are not necessarily based on the economic information set forth herein.

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.

Subject to Change

Any opinions expressed are current only as of the time made and are subject to change without notice. TCW assumes no duty to update any such statements. The views expressed herein are solely those of the author and do not represent the views of TCW as a firm or of any other portfolio manager or employee of TCW. Any holdings of a particular company or security discussed herein are under periodic review by the author and are subject to change at any time, without notice. In addition, TCW manages a number of separate strategies and portfolio managers in those strategies may have differing views or analysis with respect to a particular company, security or the economy than the views expressed herein.


There is no assurance that any securities discussed herein will remain in an account; be purchased in the portfolio at the time this report is received or that securities sold have not been repurchased. It should not be assumed that any of the securities transactions or holdings discussed were, or will prove to be, profitable or that the investment recommendations or decisions we make in the future will be profitable or will equal the investment performance of the securities discussed herein.