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An Investment Built for Full Market Cycles

The 11 year equity bull market that ran from 2009 through early 2020 was officially the longest period of growth in US history.  To put that period of time in historical context, the most recent bull market lasted almost three years longer than the post-World War II run, which many view as the most fruitful time in American history. The recent bull market ended abruptly with the onset of the ongoing COVID-19 Global Pandemic. For many passive investors, recent volatility has become an unwelcome wake up call.

A Look Back at the Market Since 2007

Russell 1000® Value Index 
(2007-2020)

Highlighted returns capture peak to trough corrections of 10% or more during the time period. Source: FactSet. As of September 30, 2020. 1Source: The Conference Board. The Consumer Confidence
Survey. reflects prevailing business conditions and likely developments for the months ahead. This monthly report details consumer attitudes and buying intentions, with data available by age, income, and region. Measurement dates: September 30, 2007, February 27, 2009, and February 29, 2020.
Past performance is no guarantee of future results.

Average annual returns (%)
(as of 09/30/20)

  Inception 1Yr 3Yr 5Yr 10Yr Since Incpt
YACKX (Class I) 07/06/92 1.90 7.51 9.76 10.07 9.98
Russell 1000® Index2

-5.03 2.63 7.66 9.95 9.22
S&P 500® Index2 15.15 12.28 14.15 13.74 9.88

Expense Ratios (gross/net): Class I 0.75% / 0.75%

1 The performance information shown for periods prior to June 29, 2012, is that of the predecessor to the Fund, The Yacktman Fund, which was reorganized into the Fund on June 29, 2012, and was managed by Yacktman Asset Management LP with the same investment objective and substantially similar investment policies as those of the Fund.
2 Effective June 30, 2020, the Yacktman Fund's primary and secondary benchmarks were changed to the Russell 1000® Value Index becoming the primary benchmark and S&P 500® Index the secondary benchmark from the S&P 500® Index as the primary benchmark and the Russell 1000® Value Index as the secondary benchmark previously. 

The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and the principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. For performance information through the most recent month end please call 800.835.3879 or visit our website at amgfunds.com.

Experience Through Market Cycles

Investors who have lived through multiple market cycles, know that times are not always good. Preparing for market downturns is a key to long term success. The AMG Yacktman Fund (YACKX), with a history of success through market cycles, may help investors as they prepare for uncertain times. To demonstrate this point, the below chart zooms out from the most recent bull market and looks at how a hypothetical $1M investment fared since the early 1990s in both the S&P 500 and the AMG Yacktman Fund.

Growth of Hypothetical $1,000,000
(1993-2020)

Source: FactSet. As of September 30, 2020. Performance measured from first full calendar year of performance. Fund inception date was July 6, 1992.

The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and the principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. For performance information through the most recent month end please call 800.835.3879 or visit our website at amgfunds.com.

Winning by Not Losing

Take a closer look at the performance of the Yacktman Fund vs. the S&P 500 Index during specific market phases from 2000 to today.  

Market Cycles
(2000-2020)

Source: FactSet. As of September 30, 2020. The information shown is for the time periods indicated. Performance for other periods may differ, possibly significantly.

The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and the principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. For performance information through the most recent month end please call 800.835.3879 or visit our website at amgfunds.com.

Proven Risk-Reward Profile in All Markets

Volatility comes in all shapes and sizes. What type of market do you think we'll be in within the next year? Depending on your answer, the 5-year rolling returns of the Yacktman Fund during different market types may be helpful. 

5-Year Rolling Returns by Market Type
(1993-2020)

The below chart shows how the Fund has performed in up and down markets. Generally, slightly smaller gains in up markets and smaller loses in down markets. 

Up/Down Capture Since Inception1
(1992-2020)

Source: FactSet. As of September 30, 2020. Down markets: 5-yr average return below 0%, Normal markets: 5-yr average return 0%-10%, Robust markets: 5-yr average return above 10%.
1 Inception date of Yacktman Fund (YACKX) is 07/06/1992.
The performance data shown represents past performance. Past performance is not a guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and the principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. For performance information through the most recent month end please call 800.835.3879 or visit our website at amgfunds.com.

The Power of Recovery

To make the performance of the AMG Yacktman Fund more tangible we looked at how a hypothetical $1M investment would do during recent market types. From one bubble peak to the next...  

Hypothetical Growth From Tech Bubble Peak to Housing Bubble Peak
(March 10, 2000 - October 31, 2007)

03/10/2000-10/31/2007 YACKX S&P 500® Index
Hypothetical Growth of $1M $3,153,199 $1,973,108 
Drawdown $984,925 $ 795,964
Recovery (Months below $1M ) 1 13

Growth From Housing Bubble Peak to Today 
(October 31, 2007 - September 30, 2020)

11/01/2007- 09/30/2020 YACKX S&P 500® Index
Hypothetical Growth of $1M $3,169,290 $1,920,432
Drawdown $539,042 $411,577
Recovery (Months below $1M ) 10 63

Source: AMG Funds, Standard & Poor's, FactSet. As of September 30, 2020.
Past performance is no guarantee of future results.

Redefining the Active Standard

Historically outperforming the S&P 500 Index, as the Fund has done over certain periods, doesn't generally happen with managers that are "closet indexers". Identifying active managers that are truly active could be a plus. 

Source: AMG Funds and Morningstar. Data as of June 30, 2020.

1 Tracking error is the difference between the return on a portfolio or fund, and the benchmark it is expected to mirror (or track). This chart calculated tracking error from April 1, 2005— June 30, 2020. The calculations included all large cap funds. Extended performance was used for some funds.
2 Active Share is based on data as of June 30, 2020.
3 Active Share is a measure of the percentage of stock holdings in a manager’s portfolio that differ from the benchmark index. 4 “Active Share: A Misunderstood Measure in Manager Selection” Lazard, February 2014. Past performance is no guarantee of future results.

Flexibility in Practice - Adapt as Markets Change

The AMG Yacktman Fund has had a historically high conviction, benchmark agnostic portfolio. Yacktman portfolio managers have also been able to use their cash and cash equivalents holdings strategically depending on their view of the markets. 

Yacktman Fund Historical Cash and Cash Equivalent Levels 
(1992-2020)

Source: Morningstar and FactSet. As of September 30, 2020. Cash and cash equivalent level sources are Morningstar (1992-2005) and AMG Funds (2005-2020).
Past performance is no guarantee of future results.

For more information about the AMG Yacktman Fund (YACKX) please contact your AMG Funds representative or continue to research the strategy below. 


IMPORTANT INFORMATION

Investors should carefully consider the Fund’s investment objectives, risks, charges, and expenses before investing. For this and other information, please call 800.835.3879 or visit amgfunds.com for a free Prospectus. Read it carefully before investing or sending money.

The Fund is subject to risks associated with investments in mid-capitalization companies such as greater price volatility, lower trading volume, and less liquidity than the stocks of larger, more established companies.

The Fund is subject to risks associated with investments in small-capitalization companies, such as erratic earnings patterns, competitive conditions, limited earnings history and a reliance on one or a limited number of products.

Companies that are in similar businesses may be similarly affected by particular economic or market events; to the extent the Fund has substantial holdings within a particular sector, the risks associated with that sector increase.

The Fund invests in value stocks, which may perform differently from the market as a whole and may be undervalued by the market for a long period of time.

Investments in international securities are subject to certain risks of overseas investing including currency fluctuations and changes in political and economic conditions, which could result in significant market fluctuations. These risks are magnified in emerging markets.

The Fund is subject to the risks associated with investments in debt securities, such as default risk and fluctuations in the perception of the debtor’s ability to pay its creditors. Changing interest rates may adversely affect the value of an investment.

An increase in interest rates typically causes the value of bonds and other fixed income securities to fall.

High-yield bonds (also known as “junk bonds”) may be subject to greater levels of interest rate, credit, and liquidity risk than investments in higher rated securities. These securities are considered predominantly speculative with respect to the issuer’s continuing ability to make principal and interest payments. The issuers of the Fund’s holdings may be involved in bankruptcy proceedings, reorganizations, or financial restructurings, and are not as strong financially as higher-rated issuers.

The S&P 500® Index is a capitalization-weighted index of 500 stocks. The S&P 500 Index is designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.
Diversification does not ensure a profit or protect against a loss.
This does not constitute investment advice or an investment recommendation.

The Russell 1000® Value Index measures the performance of those Russell 1000 companies with lower price/book ratios and lower forecasted growth values. The stocks are also members of the Russell 3000® Value Index.

The CBOE Volatility Index (VIX) is a measure of expected price fluctuations in the S&P 500 Index options over the next 30 days.
The indices are unmanaged, are not available for direct investment and do not incur expenses.

Market Risk—Market prices of investments held by the Fund may fall rapidly or unpredictably due to a variety of economic or political factors, market conditions, disasters or public health issues, or in response to events that affect particular industries or companies.

© 2020 Morningstar, Inc. All Rights Reserved. Some of the information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar, its content providers nor the AMG Funds are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.
Not FDIC Insured | May Lose Value | Not Bank Guaranteed
AMG Funds are distributed by AMG Distributors, Inc., a member of FINRA/SIPC.

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