Legg Mason Value Trust

Investment Objective¹

Long-term capital growth.

Investment Strategy

Value companies, not stocks

The Fund follows a value discipline of investing by purchasing primarily large-capitalization stocks at large discounts to the manager's assessment of their intrinsic value.

Traditional and untraditional valuation measures

Our analytical approach is not based on traditional, accounting-based valuation measures. We are focused on cash earnings — namely, the present value of future cash flows of a company. Shareholder value is the result of cash, not accounting, earnings. In this way, we believe we differ from most value managers. Traditional valuation measures miss many mispriced stocks because those measures do not focus on the value of a business.

Investment Risks

Market risk

The risk that prices of securities will go down because of the interplay of market forces.

Value-style risk

The value approach to investing involves the risk that those stocks deemed to be undervalued by the portfolio manager may remain undervalued.

Concentration risk

Because this Fund expects to hold a concentrated portfolio of a limited number of securities, a decline in the value of these investments would cause the fund's overall value to decline to a greater degree than a less concentrated portfolio. The Fund may focus its investments in certain regions or industries, thereby increasing its potential vulnerability to market volatility.

Investment Management

Managed by Legg Mason Capital Management

• Since 1982, invests in companies that appear to be selling at significant discounts to their intrinsic value.
• The Fund is managed by Bill Miller, who has over 26 years of investment industry experience.