ClearBridge Large Cap Growth Portfolios

Investment Overview

The ClearBridge Large Cap Growth Portfolios seek high-quality, large-company stocks that can provide the potential for solid long-term performance.

 

Investment Philosophy

  • Invest in leadership companies where we believe the market price underestimates the magnitude of future growth
  • Use stock selection as primary driver – identify category leaders with characteristics to sustain that position
  • Find secular tailwinds to support multi-year investment opportunities, allowing for compounding of earnings and cash flow
  • Perform rigorous analysis to understand company fundamentals, key competitive dynamics and industry structure

Believe that the best business models win over time

  • Identify barriers to entry and prefer companies with innovation prowess, regardless of size
  • Look for businesses that protect and grow market share consistently
  • Gravitate to self-funding business models with significant recurring revenue

Seek businesses with the ability to generate solid free cash flow over time

  • Stress test the sustainability of profitability and growth

Take a disciplined approach to valuation

 

Portfolio Positioning

  • Designed for investors seeking long-term capital appreciation through investments in large-capitalization companies with the potential for future earnings growth
  • Long-term, buy-and-hold approach results in lower portfolio turnover
 

Diversification does not guarantee a profit or protect against a loss.

Market, security and/or other investment considerations may result in higher turnover from time to time. Also, all capitalization ranges will not necessarily be represented in an individual account.

There is no guarantee that the Portfolio's objectives will be met.

 

 

Investment
Process

Idea generation

  • Sector analysts and PMs each propose companies with attractive business models and good long-term growth prospects for further review. 
  • Idea generation is an ongoing and continual process.

Fundamental analysis

  • Analysts and PMs work together to understand the durability of a company’s growth and profit. 
  • Meet with target company management, competitors and industry experts.
  • Determine appropriate entry price.

Portfolio construction

  • Own companies with a range of growth and volatility. 
  • Maintain high active share. 
  • Monitor sector weightings and correlations among current holdings.

Risk management/evaluation discipline

Assess risk regularly.

The investment process may change over time. The characteristics set forth above are intended as a general illustration of some of the criteria the strategy team considers in selecting securities for client portfolios. There is no guarantee investment objectives will be achieved.

 

 

meet your managers

Global investment manager with over 50 years of experience and long-tenured portfolio managers who seek to build income, high active share or low volatility portfolios.


Peter Bourbeau

Managing Director, Portfolio Manager

Margaret Vitrano

Managing Director, Portfolio Manager

Active share is a measure of the percentage of stock holdings in a manager's portfolio that differs from the benchmark index.

To find out more about the ClearBridge Large Cap Growth Portfolios, talk to your financial advisor.


 

What I Should Know
Before Investing

All investments involve risk, including loss of principal and there is no guarantee that investment objectives will be met.  Investments may also be made in ADRs and other securities of non-U.S. companies in developed and emerging markets which involve risks in addition to those ordinarily associated with investing in domestic securities, including the potentially negative effects of currency fluctuation, political and economic developments, foreign taxation and differences in auditing and other financial standards. These  risks are magnified in emerging markets. 

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IMPORTANT INFORMATION: Past performance is no guarantee of future results. Management and performance of individual accounts may vary for reasons that include the existence of different implementation practices and model requirements in different investment programs.

Pure Gross performance shown does not reflect the deduction of investment management fees and certain transaction costs, which will reduce portfolio performance. Net performance includes the deduction of a 3% annual wrap fee for equity and balanced portfolios and a 1.5% annual wrap fee for fixed income portfolios. These deducted fees amounts are the maximum anticipated wrap fees. Actual fees may vary. For fee schedules, contact your financial professional or, if you enter into an agreement directly with Legg Mason Private Portfolio Group, LLC ("LMPPG"), refer to LMPPG's Form ADV disclosure document.

An investor cannot invest directly in an index. Unmanaged index returns do not reflect any fees, expenses or sales charges. 

Please see GIPS® endnotes for important additional information regarding the portfolio performance shown and for effects of fees. 

Performance Source: Legg Mason

Hypothetical growth of dollars: For illustrative purposes only. Assumes no withdrawals or contributions. The performance results shown were calculated assuming reinvestment of dividends and income and take into account both realized and unrealized capital gains and losses.

IMPORTANT INFORMATION: Separately Managed Accounts (SMAs) are investment services provided by Legg Mason Private Portfolio Group, LLC (LMPPG), a federally registered investment adviser. Client portfolios are managed based on investment instructions or advice provided by one or more of the following Legg Mason-affiliated sub-advisers: ClearBridge Investments, and Western Asset Management Company. Management is implemented by LMPPG, the designated sub-adviser or, in the case of certain programs, the program sponsor or its designee.


Professional money management may not be suitable for all investors. Factual information relating to the securities discussed was obtained from sources believed to be reliable, but there can be no guarantee as to its accuracy. It should not be assumed that investments made in the future will be profitable or will equal the performance of the securities discussed in the material.

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Portfolio characteristics (Source: FactSet)

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ClearBridge Large Cap Growth SMA GIPS® Endnotes Inception date: January 2006. Composite creation date: June 2008.
Period Total net return
(%)
Total pure
gross* return (%)
R1000G return
(%)
Number of
portfolios
Bundled fee
portfolios (%)
Composite
dispersion (%)
Composite 3-Yr.
St. Dev.
Benchmark 3-Yr.
St. Dev
Composite
assets ($mm)
Firm assets (%) Total firm
assets ($mm)
2016 5.23 8.37 7.08 1,390 99 0.22 11.26 11.31 1,225.5 1.2 100,936.9
2015
7.33 10.53
5.67 682
100 0.23
11.17
10.85
852.8
0.9
92,536.4
2014
11.28 14.59 13.05 452
100 0.13
10.25
9.73
825.9
0.8
100,721.5
2013
34.88 38.83 33.48
359
100 0.71
12.61
12.35
715.1
0.8
85,024.7
2012
17.79
21.27
15.26 2,864
100 0.43
16.28
15.88
545.2
1.0 54,624.3
2011
-1.84 1.12 2.64 2,708
100 0.42 18.66 18.01
385.9
0.8
50,870.8
2010
7.29
10.49 16.71 3,264
100 0.72
n/a n/a 481.3
0.9
55,366.5
2009
32.49 36.37 37.21 4,129
100 1.98
n/a n/a 573.0
1.1 53,522.7
2008
-39.53 -37.63
-38.44 4,113
100 1.08
n/a n/a 435.3
0.9
50,614.9
2007
0.97
4.00 11.81 6,280
100 1.15
n/a n/a 1,043.0
2.2
47,112.0

*Pure gross of fee returns do not reflect the deduction of any expenses, including transaction costs, and are presented as supplemental to the net of fee returns.

Compliance Statement:
ClearBridge Investments, LLC claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with the GIPS standards. ClearBridge Investments, LLC has been independently verified for the periods January 1, 1997 - December 31, 2015. The verification reports are available upon request.

Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm's policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. Verification does not ensure the accuracy of any specific composite presentation.

Firm Information:
ClearBridge Investments, LLC ("ClearBridge") is a wholly owned subsidiary of Legg Mason, Inc. ("Legg Mason"). The investment advisory business now known as ClearBridge was registered in September 2005 to facilitate Legg Mason's acquisition of substantially all the equity asset management businesses known as Citigroup Asset Management. These former businesses serve as the foundation of ClearBridge and its claim of GIPS compliance for institutional accounts through predecessor firms, effective as of January 1997. In June 2008, ClearBridge combined this business with its retail business to form a single GIPS firm. As of April 1, 2013 and January 1, 2016, ClearBridge's affiliates, Global Currents Investment Management, LLC, and ClearBridge, LLC, respectively, have become part of the ClearBridge GIPS firm.

Composite Information:
The ClearBridge Large Cap Growth SMA composite consists of discretionary wrap accounts with an account minimum of US $25,000. Accounts within the composite seek consistent growth of capital while minimizing volatility. Investments are primarily made in U.S. companies, with an objective of outperforming the Russell 1000 Growth Index. The main risks of this strategy are General Investment Risk and Non-U.S. Investment Risk. Prior to June 2008, the minimum was $5,000.

Input and Calculation Data:
The fee schedule currently in effect is 3.00% on all assets. Net of fee composite returns are calculated by reducing each monthly composite pure gross rate of return by the highest "bundled" fee charged (3.00%) annually, prorated to a monthly ratio. The "bundled" fee includes transaction costs, investment management, custodial, and other administrative fees. The pure gross return reflects the deduction of transaction costs for some accounts in the composite. Effective January 1, 2013, the number of portfolios reflects a change from prior periods due to an aggregation of accounts as reported by one sponsor. As of January 2014, the internal dispersion of annual returns is measured by the asset-weighted standard deviation of portfolio returns included in the composite for the entire year. For prior years, the equal-weighted standard deviation was used. Total firm assets for 2007 represents the CBI-Retail firm. The composite employed a 10% significant cash flow policy which was discontinued in January 2012. A list of composite descriptions is available upon request. Policies for valuing portfolios, calcul ating performance, and preparing compliant presentations are available upon request. Past performance is not necessarily indicative of future results.

Benchmark Information:
The Russell 1000® Growth Index measures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values

All investments involve risk, including loss of principal. Past performance is no guarantee of future results. Please see each product’s webpage for specific details regarding investment objective, risks associated with hedge funds, alternative investments and other risks, performance and other important information. Review this information carefully before you make any investment decision.

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