Davis Real Estate Fund
Overview
Investment Strategy
The goal of the Davis Real Estate Fund is to provide investors access to attractive investment opportunities in companies related to the real estate industry.
The Fund applies our signature Davis Investment Discipline to real estate, seeking companies with first-class management teams who view real estate as a means of producing steadily increasing income and strong returns on capital.
Why Invest in the Davis Real Estate Fund
Increased Portfolio Diversification
The Fund offers investors a good way to increase the diversification of their portfolios. Real estate securities have historically shown a lower sensitivity to price movements (beta) than broad stock market averages. At the same time, real estate returns over the long term have been comparable to those of equities, but not correlated with them (R-squared).1
Aligned with Shareholders
With more than $2 billion invested side by side with fellow shareholders, we experience the same risks and reap the same rewards.2
Our Culture of Shareholder Stewardship
Morningstar has recognized Davis Advisors commitment to shareholders by awarding the Fund its highest overall Stewardship Grade of A, a level achieved by less than 14% of the funds Morningstar grades.3
Lower than Average Expense Ratio4
Davis Real Estate Fund A, 1.01%; Lipper category average, 1.32%
Lower than Average Turnover Rate4
Davis Real Estate Fund, 50%; Lipper category average, 71%
Performance as of 3/31/13
The charts below illustrate the long-term performance and diversification attributes of the Davis Real Estate Fund.
Attractive Total Return Potential
January 3, 1994 - March 31, 2013
10 year US Treasury is represented by the Citi 10 Year U.S. Treasury index. Inflation is represented by the Consumer Price Index.
Low Correlation to Common Stocks
Period Ending March 31, 2013/R-Squared
Source: Wilshire Atlas Monitor Report (3/08 - 3/13)
Annualized Total Returns
| Total Returns as of March 31, 2013 |
YTD* | 1 Year |
3 Years |
5 Years |
10 Years |
15 Years |
Since 1/3/94 |
|
|---|---|---|---|---|---|---|---|---|
|
Davis Real Estate Fund Class A Shares without a sales charge |
3.69% | 9.30% | 13.72% | 2.88% | 9.85% | 7.34% | 10.07% | |
| with a maximum 4.75% sales charge | -1.23% | 4.11% | 11.89% | 1.88% | 9.31% | 7.00% | 9.79% | |
| S&P 500® Index | 10.61% | 13.96% | 12.67% | 5.81% | 8.53% | 4.27% | 8.59% |
*YTD is not annualized
The performance presented represents past performance and is not a guarantee of future results. Total return assumes reinvestment of dividends and capital gain distributions. Investment return and principal value will vary so that, when redeemed, an investor’s shares may be worth more or less than their original cost. The total annual operating expense ratio for Class A shares as of the most recent prospectus was 1.01%. The total annual operating expense ratio may vary in future years. Returns and expenses for other classes of shares will vary. Current performance may be higher or lower than the performance quoted. For most recent month-end performance, click here or call 800.279.0279.
Portfolio Characteristics as of 3/31/13
Portfolio Composition
| Real Estate Fund | |
|---|---|
| Forecast P/E Ratio | 46.6 |
| P/B Ratio | 3.1 |
| Weighted Average Market Cap ($bn) | 11.9 |
| Beta (3 year) | 0.9 |
| Standard Deviation (5 year, A shares) | 30.6 |
| Number of Holdings | 43 |
Turnover and Expenses
| Real Estate Fund | Lipper Category Average | |
|---|---|---|
| Turnover Rate4 | 50% | 71% |
| Expense Ratio4 | 1.01% | 1.32% |
Morningstar Rating
| Stewardship Grade | A |
Top 10 Holdings
| Simon Property Group Inc. | 7.3% |
| Alexandria Real Estate Equities, 7.00, Series D, Conv Prfd | 4.8% |
| Digital Realty Trust | 4.2% |
| Vornado Realty Trust | 3.8% |
| Forest City Enterprises Inc. - Class A | 3.8% |
| Alexandria Real Estate Equities, Inc. | 3.7% |
| Avalonbay Communities, Inc. | 3.2% |
| Digital Realty Trust, 144A Conv. Sr. Notes, 5.5%, 4/15/29 | 3.0% |
| Boston Properties, Inc. | 2.9% |
| DuPont Fabros Technology Inc. | 2.7% |
Top 5 Industries
| Office | 26.9% |
| Residential | 17.2% |
| Retail | 16.1% |
| Specialized | 15.2% |
| Diversified | 6.0% |
Literature
| Fact Sheet | ||
|---|---|---|
| Fund Fact Sheet | Download Share | Applying the Davis Investment Discipline to real estate-related businesses, potential asset allocation benefits for investors, Portfolio characteristics, holdings, performance, and more. |
| Portfolio Composition | Download Share | Quarterly update of portfolio characteristics. |
| Portfolio Manager Commentary | ||
| Manager Commentary - Annual Review 2013 | Download View Share | Portfolio Managers Andrew Davis and Chandler Spears discuss the real estate market, Portfolio companies, and recent performance. |
This material must be accompanied or preceded by a current Davis Real Estate Fund Prospectus. You should carefully consider the Fund’s investment objective, risks, charges, and expenses before investing. The prospectus contains this and other information and can be obtained by clicking here or calling 800.279.0279. Read the prospectus carefully before you invest or send money.
1Diversification does not insure against loss.
2As of December 31, 2012.
3As of December 31, 2012.
4See Expense ratio/Turnover link below.
(24) Read here for objective/risk disclosures
(25) Read here for Morningstar disclosures
(26) Read here for Expense ratio/Turnover disclosures
Davis Distributors, LLC, 2949 East Elvira Road, Suite 101, Tucson, AZ 85756