ck0001032423-20221231
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Investor
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Class I |
Class Y |
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Diamond Hill Small Cap
Fund |
DHSCX |
DHSIX |
DHSYX |
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Diamond Hill Small-Mid Cap
Fund |
DHMAX |
DHMIX |
DHMYX |
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Diamond Hill Mid Cap
Fund |
DHPAX |
DHPIX |
DHPYX |
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Diamond Hill Large Cap
Fund |
DHLAX |
DHLRX |
DHLYX |
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Diamond Hill Large Cap Concentrated
Fund |
DHFAX |
DHFIX |
DHFYX |
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Diamond Hill Select Fund (formerly All Cap
Select Fund) |
DHTAX |
DHLTX |
DHTYX |
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Diamond Hill Long-Short
Fund |
DIAMX |
DHLSX |
DIAYX |
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Diamond Hill International
Fund |
DHIAX |
DHIIX |
DHIYX |
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Diamond Hill Short Duration Securitized Bond
Fund |
DHEAX |
DHEIX |
DHEYX |
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Diamond Hill Core Bond
Fund |
DHRAX |
DHRIX |
DHRYX |
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As
with all mutual fund shares and prospectuses, the Securities and
Exchange Commission has not approved or disapproved these shares or passed
upon the adequacy of this prospectus. Any representation to the contrary
is a criminal offense. |
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Table
of Contents |
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Fund
Summaries |
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Diamond
Hill Small Cap Fund |
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Diamond
Hill Small-Mid Cap Fund |
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Diamond
Hill Mid Cap Fund |
|
Diamond
Hill Large Cap Fund |
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Diamond
Hill Large Cap Concentrated Fund |
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Diamond
Hill Select Fund |
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Diamond
Hill Long-Short Fund |
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Diamond
Hill International Fund |
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Diamond
Hill Short Duration Securitized Bond Fund |
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Diamond
Hill Core Bond Fund |
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Fund
Details |
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Additional
Information About Investment Strategies and Related Risks |
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Investment
Risks |
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Portfolio
Holdings Disclosure |
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Management
of the Funds |
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| |
Your
Account |
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Pricing
Your Shares |
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How
to Purchase Shares |
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How
to Redeem Shares |
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How
to Exchange Shares |
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How
to Request Certain Non-Financial Transactions |
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Market
Timing and Frequent Trading Policy |
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Distribution
and Taxes |
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Householding |
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Financial
Highlights |
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For
more information, see back cover.
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Class |
Investor |
I |
Y |
Ticker |
DHSCX |
DHSIX |
DHSYX |
Investment Objective
The investment objective of
the Diamond Hill Small Cap Fund is to provide long-term capital
appreciation.
Fees and Expenses of the
Fund
This table describes the fees
and expenses that you may pay if you buy and hold shares of the fund. You may
pay other fees, such as brokerage commissions and other fees to financial
intermediaries, which are not reflected in the tables and examples
below.
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SHAREHOLDER FEES (fees paid directly from
your investment) |
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None |
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ANNUAL FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your
investment) |
|
Investor |
Class I |
Class Y |
Management
fees |
0.80 |
% |
0.80 |
% |
0.80 |
% |
Distribution
(12b-1) fees |
0.25 |
% |
None |
None |
Other
expenses |
0.21 |
% |
0.17 |
% |
0.05 |
% |
Total
annual fund operating expenses |
1.26 |
% |
0.97 |
% |
0.85 |
% |
This Example is
intended to help you compare the cost of investing in the fund with the cost of
investing in other mutual funds. The Example assumes that you invest $10,000 in
the fund for the time periods indicated and then redeem all of your shares at
the end of those periods. The Example also assumes that your investment has a 5%
return each year and that the fund’s operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
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1 Year |
3 Years |
5 Years |
10 Years |
Investor |
$128 |
| $400 |
| $692 |
| $1,523 |
|
Class I |
99 |
| 309 |
| 536 |
| 1,190 |
|
Class Y |
87 |
| 271 |
| 471 |
| 1,049 |
|
The fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the fund’s performance. During the most recent fiscal
year, the fund’s portfolio turnover rate was 37% of the average value of
its portfolio.
Principal Investment
Strategy
The
fund, under normal market conditions, invests at least 80% of its net assets in
U.S. equity securities with small market capitalizations that Diamond Hill
Capital Management, Inc. (the "Adviser”) believes are undervalued. Equity
securities consist of common and preferred stocks. Small cap companies are
defined as companies with market capitalizations at the time of purchase below
$3 billion or in the range of those market capitalizations of companies
included in the Russell 2000 Index at the time of purchase. The
capitalization range of the Russell 2000 Index is between $6.8 million and $7.8
billion as of January 31, 2023. The
size of the companies included in the Russell 2000 Index will change with market
conditions.
The
Adviser focuses on estimating a company’s value independent of its current stock
price. To estimate a company’s value, the Adviser concentrates on the
fundamental economic drivers of the business. The primary focus is on
“bottom-up” analysis, which takes into consideration earnings, revenue growth,
operating margins and other economic factors. The Adviser also considers the
level of industry competition, regulatory factors, the threat of technological
obsolescence, and a variety of other industry factors. If the Adviser’s estimate
of a company’s value differs sufficiently from the current market price, the
company may be an attractive investment opportunity. In constructing a portfolio
of securities, the Adviser is not constrained by the sector or industry weights
in the benchmark. The Adviser relies on individual stock selection and
discipline in the investment process to add value. The highest portfolio
security weights are assigned to companies where the Adviser has the highest
level of conviction.
Once a stock is selected, the Adviser
continues to monitor the company’s strategies, financial performance and
competitive environment. The Adviser may sell a security as it reaches the
Adviser’s estimate of the company’s value if it believes that the company’s
earnings, revenue growth, operating margin or other economic factors are
deteriorating or if it identifies a stock that it believes offers a better
investment opportunity.
Main Risks
All
investments carry a certain amount of risk and the fund cannot guarantee that it
will achieve its investment objective. An investment in the fund is not a
deposit or obligation of any bank, is not endorsed or guaranteed by any bank,
and is not insured by the Federal Deposit Insurance Corporation (FDIC) or any
other government agency. You may lose money by investing in the
fund. Below are the main risks of investing in the fund. All of
the risks listed below are significant to the fund, regardless of the order in
which they appear.
Management
Risk The
Adviser’s judgments about the attractiveness, value and potential appreciation
of a particular asset class or individual security in which the fund invests may
prove to be incorrect and there is no guarantee that individual companies will
perform as anticipated. The value of an individual company can be more volatile
than the market as a whole, and the Adviser’s intrinsic value-oriented approach
may fail to produce the intended
results.
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1
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
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Diamond
Hill Small Cap Fund Summary |
As
of February 28, 2023 |
Market
Risk The
value of the fund's investments may decrease, sometimes rapidly or unexpectedly,
due to factors affecting an issuer held by the fund, particular industries or
overall securities markets. When the value of the fund’s investments goes down,
your investment in the fund decreases in value. A variety of factors including
interest rate levels, recessions, inflation, U.S. economic growth, war or acts
of terrorism, natural disasters, political events, supply chain disruptions,
staff shortages and widespread public health issues affect the securities
markets. These events may cause volatility, severe market dislocations and
liquidity constraints in many markets, including markets for the securities the
fund holds, and may adversely affect the fund's investments and operations. In
addition, governmental responses to these events may negatively impact the
capabilities of the fund's service providers, disrupt the fund's operations,
result in substantial market volatility and adversely impact the prices and
liquidity of the fund's investments.
Small
Cap Company Risk Investments
in small cap companies may be riskier than investments in larger, more
established companies. The securities of smaller companies may trade less
frequently and in smaller volumes than securities of larger companies. In
addition, smaller companies may be more vulnerable to economic, market and
industry changes. As a result, share price changes may be more sudden or erratic
than the prices of other equity securities, especially over the short term.
Because smaller companies may have limited product lines, markets or financial
resources or may depend on a few key employees, they may be more susceptible to
particular economic events or competitive factors than large capitalization
companies.
Performance
The
following bar chart and table show two aspects of the fund: volatility and
performance. The bar chart
shows the volatility — or variability — of the fund’s annual total returns over
time, and shows that fund performance can change from year to
year. The table shows the fund’s average annual total returns
for certain time periods compared to the returns of a broad-based securities
index. The bar chart and table provide some indication of the risks of investing
in the fund. Of course, the fund’s past
performance is not necessarily an indication of its future
performance. Updated
performance information is available at no cost by visiting www.diamond-hill.com
or by calling 888-226-5595.
CLASS I ANNUAL TOTAL RETURN-YEARS ENDED
12/31
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Best
Quarter: |
4Q 2020, +26.68% |
Worst
Quarter: |
1Q 2020, -36.17% |
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AVERAGE
ANNUAL TOTAL RETURNS AS OF
12/31/22 |
After-tax returns are
calculated using the highest historical individual federal marginal income tax
rate and do not reflect the impact of state and local taxes.
Actual after-tax returns
depend on a shareholder's tax situation and may differ from those shown.
After-tax returns are not relevant for shareholders who hold fund shares in
tax-deferred accounts or to shares held by non-taxable entities.
After-tax returns are shown
for Class I shares only and will vary from the after-tax returns for the other
share classes.
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| Inception Date of Class |
One Year |
Five Year |
Ten Year |
Class I
Before
Taxes |
4/29/05 |
(14.77) |
% |
3.19 |
% |
7.73 |
% |
After Taxes on
Distributions |
| (17.96) |
| 0.83 |
| 5.93 |
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After Taxes on Distributions and Sale
of Fund Shares |
| (6.59) |
| 2.41 |
| 6.14 |
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Investor
Before Taxes |
12/29/00 |
(15.02) |
| 2.89 |
| 7.43 |
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Class
Y
Before Taxes |
12/30/11 |
(14.64) |
| 3.31 |
| 7.86 |
|
Russell 2000
Index |
| (20.44) |
| 4.13 |
| 9.01 |
|
The Russell 2000 Index
measures the performance of roughly 2,000 US small-cap companies. The index is
unmanaged, market capitalization weighted, includes net reinvested dividends,
does not reflect fees or expenses (which would lower the return), and is not
available for direct investment.
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DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM
2 |
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Diamond
Hill Small Cap Fund Summary |
As
of February 28, 2023 |
Portfolio
Management
Investment
Adviser
Diamond
Hill Capital Management, Inc.
Portfolio
Managers
Aaron
Monroe
Portfolio
Manager
since
2/2017
Christopher
Welch
Assistant
Portfolio Manager
since
4/2007
Buying
and Selling Fund Shares
Minimum
Initial Investment
Investor
and Class I: $2,500
Class
Y: $500,000
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To Place Orders |
Mail:
Diamond
Hill Small Cap Fund
P.O.
Box 46707
Cincinnati,
OH 45246
Phone:
888-226-5595 |
Transaction
Policies
In
general, you can buy or sell (redeem) shares of the fund by mail or phone on any
business day. You can generally pay for shares by check or wire. You may be
charged wire fees or other transaction fees; ask your financial professional.
When selling shares, you will receive a check, unless you request a wire. You
may also buy and sell shares through a financial professional.
Dividends,
Capital Gains and Taxes
The
fund’s distributions may be taxable as ordinary income or capital gains, except
when your investment is in an IRA, 401(k) or other tax-advantaged investment
plan. However, you may be subject to tax when you withdraw monies from a
tax-advantaged plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If
you purchase shares (other than Class Y shares) through a broker-dealer or other
financial intermediary (such as a bank), the fund and its related companies may
pay the intermediary for the sale of fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your salesperson to recommend the fund over another
investment. Ask your salesperson or visit your financial intermediary’s web site
for more information.
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3
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
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Class |
Investor |
I |
Y |
Ticker |
DHMAX |
DHMIX |
DHMYX |
Investment Objective
The investment objective of
the Diamond Hill Small-Mid Cap Fund is to provide long-term capital
appreciation.
Fees and Expenses of the
Fund
This table describes the fees
and expenses that you may pay if you buy and hold shares of the fund. You may
pay other fees, such as brokerage commissions and other fees to financial
intermediaries, which are not reflected in the tables and examples
below.
|
| |
SHAREHOLDER FEES (fees paid directly from
your investment) |
|
None |
|
|
|
|
|
|
|
|
|
|
| |
ANNUAL FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your
investment) |
| Investor |
Class I |
Class Y |
Management
fees |
0.75 |
% |
0.75 |
% |
0.75 |
% |
Distribution
(12b-1) fees |
0.25 |
% |
None |
None |
Other
expenses |
0.21 |
% |
0.17 |
% |
0.05 |
% |
Total
annual fund operating expenses |
1.21 |
% |
0.92 |
% |
0.80 |
% |
This Example is
intended to help you compare the cost of investing in the fund with the cost of
investing in other mutual funds. The Example assumes that you invest $10,000 in
the fund for the time periods indicated and then redeem all of your shares at
the end of those periods. The Example also assumes that your investment has a 5%
return each year and that the fund’s operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
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1 Year |
3 Years |
5 Years |
10 Years |
Investor |
$123 |
| $384 |
| $665 |
| $1,466 |
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Class I |
94 |
| 293 |
| 509 |
| 1,131 |
|
Class Y |
82 |
| 255 |
| 444 |
| 990 |
|
The fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the fund’s performance. During the most recent fiscal
year, the fund’s portfolio turnover rate was 25% of the average value of
its portfolio.
Principal Investment Strategy
The
fund, under normal market conditions, invests at least 80% of its net assets in
U.S. equity securities with small and medium market capitalizations that Diamond
Hill Capital Management, Inc. (the "Adviser”) believes are undervalued. Equity
securities consist of common and preferred stocks. Small and mid cap companies
are defined as companies with market capitalizations at the time of purchase
between $500 million and $10 billion or in the range of those market
capitalizations of companies included in the Russell 2500 Index at the time of
purchase. The
capitalization range of the Russell 2500 Index is between $6.8 million and $21.7
billion as of January 31, 2023.
The size of the companies included in the Russell 2500 Index will change with
market conditions.
The
Adviser focuses on estimating a company’s value independent of its current stock
price. To estimate a company’s value, the Adviser concentrates on the
fundamental economic drivers of the business. The primary focus is on
“bottom-up” analysis, which takes into consideration earnings, revenue growth,
operating margins and other economic factors. The Adviser also considers the
level of industry competition, regulatory factors, the threat of technological
obsolescence, and a variety of other industry factors. If the Adviser’s estimate
of a company’s value differs sufficiently from the current market price, the
company may be an attractive investment opportunity. In constructing a portfolio
of securities, the Adviser is not constrained by the sector or industry weights
in the benchmark. The Adviser relies on individual stock selection and
discipline in the investment process to add value. The highest portfolio
security weights are assigned to companies where the Adviser has the highest
level of conviction.
Once a stock is selected, the Adviser
continues to monitor the company’s strategies, financial performance and
competitive environment. The Adviser may sell a security as it reaches the
Adviser’s estimate of the company’s value if it believes that the company’s
earnings, revenue growth, operating margin or other economic factors are
deteriorating; or, if it identifies a stock that it believes offers a better
investment opportunity.
Main Risks
All
investments carry a certain amount of risk and the fund cannot guarantee that it
will achieve its investment objective. An investment in the fund is not a
deposit or obligation of any bank, is not endorsed or guaranteed by any bank,
and is not insured by the Federal Deposit Insurance Corporation (FDIC) or any
other government agency. You may lose money by investing in the
fund. Below are the main risks of investing in the fund. All of
the risks listed below are significant to the fund, regardless of the order in
which they appear.
Management
Risk The
Adviser’s judgments about the attractiveness, value and potential appreciation
of a particular asset class or individual security in which the fund invests may
prove to be incorrect and there is no guarantee that individual companies will
perform as anticipated. The value of an individual company can be more volatile
than the market as a whole, and the Adviser’s intrinsic value-oriented approach
may fail to produce the intended
results.
|
| |
4
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
|
|
| |
Diamond
Hill Small-Mid Cap Fund Summary |
As
of February 28, 2023 |
Market
Risk The
value of the fund's investments may decrease, sometimes rapidly or unexpectedly,
due to factors affecting an issuer held by the fund, particular industries or
overall securities markets. When the value of the fund’s investments goes down,
your investment in the fund decreases in value. A variety of factors including
interest rate levels, recessions, inflation, U.S. economic growth, war or acts
of terrorism, natural disasters, political events, supply chain disruptions,
staff shortages and widespread public health issues affect the securities
markets. These events may cause volatility, severe market dislocations and
liquidity constraints in many markets, including markets for the securities the
fund holds, and may adversely affect the fund's investments and operations. In
addition, governmental responses to these events may negatively impact the
capabilities of the fund's service providers, disrupt the fund's operations,
result in substantial market volatility and adversely impact the prices and
liquidity of the fund's investments.
Small
Cap and Mid Cap Company Risk Investments in small cap and
mid cap companies may be riskier than investments in larger, more established
companies. The securities of these companies may trade less frequently and in
smaller volumes than securities of larger companies. In addition, small cap and
mid cap companies may be more vulnerable to economic, market and industry
changes. As a result, share price changes may be more sudden or erratic than the
prices of other equity securities, especially over the short term. Because
smaller companies may have limited product lines, markets or financial resources
or may depend on a few key employees, they may be more susceptible to particular
economic events or competitive factors than large capitalization
companies.
Performance
The
following bar chart and table show two aspects of the fund: volatility and
performance. The bar chart
shows the volatility — or variability — of the fund’s annual
total returns over time, and shows that fund performance can change from year to
year. The table shows the fund’s average annual total returns
for certain time periods compared to the returns of a broad-based securities
index. The bar chart and table provide some indication of the risks of investing
in the fund. Of course, the fund’s past
performance is not necessarily an indication of its future
performance.
Updated performance information is available at no cost by visiting
www.diamond-hill.com
or by calling 888-226-5595.
CLASS I ANNUAL TOTAL RETURN-YEARS ENDED
12/31
|
|
|
|
| |
Best
Quarter: |
4Q 2020, +23.26% |
Worst
Quarter: |
1Q 2020, -35.83% |
|
| |
AVERAGE
ANNUAL TOTAL RETURNS AS OF
12/31/22 |
After-tax returns are
calculated using the highest historical individual federal marginal income tax
rate and do not reflect the impact of state and local
taxes.
Actual after-tax returns
depend on a shareholder's tax situation and may differ from those shown.
After-tax returns are not relevant for shareholders who hold fund shares in
tax-deferred accounts or to shares held by non-taxable
entities.
After-tax returns are shown
for Class I shares only and will vary from the after-tax returns for the other
share classes.
|
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|
|
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|
| |
| Inception Date of Class |
One Year |
Five Year |
Ten Year |
Class
I Before
Taxes |
12/30/05 |
(13.62) |
% |
5.09 |
% |
9.75 |
% |
After Taxes on
Distributions |
| (14.76) |
| 4.02 |
| 8.78 |
|
After Taxes on Distributions and Sale
of Fund Shares |
| (7.43) |
| 3.88 |
| 7.86 |
|
Investor
Before Taxes |
12/30/05 |
(13.86) |
| 4.79 |
| 9.44 |
|
Class
Y
Before Taxes |
12/30/11 |
(13.51) |
| 5.22 |
| 9.90 |
|
Russell 2500
Index |
| (18.37) |
| 5.89 |
| 10.03 |
|
The Russell 2500 Index
measures the performance of roughly 2,500 US small to mid-cap companies. The
index is unmanaged, market capitalization weighted, includes net reinvested
dividends, does not reflect fees or expenses (which would lower the return), and
is not available for direct investment.
Portfolio
Management
Investment
Adviser
Diamond
Hill Capital Management, Inc.
Portfolio
Manager
Christopher
Welch
Portfolio
Manager
since
12/2005
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| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 5 |
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| |
Diamond
Hill Small-Mid Cap Fund Summary |
As
of February 28, 2023 |
Buying
and Selling Fund Shares
The
fund is closed to most new investors. Refer to “How to Purchase Shares —
Important Information About the Small Mid-Cap Fund” for more information about
the circumstances under which the fund will remain open to additional
investments.
Minimum
Initial Investment
Investor
and Class I: $2,500
Class
Y: $500,000
|
|
|
|
| |
To Place Orders |
Mail:
Diamond
Hill Small-Mid Cap Fund
P.O.
Box 46707
Cincinnati,
OH 45246
Phone:
888-226-5595 |
Transaction
Policies
In
general, you can buy or sell (redeem) shares of the fund by mail or phone on any
business day. You can generally pay for shares by check or wire. You may be
charged wire fees or other transaction fees; ask your financial professional.
When selling shares, you will receive a check, unless you request a wire. You
may also buy and sell shares through a financial professional.
Dividends,
Capital Gains and Taxes
The
fund’s distributions may be taxable as ordinary income or capital gains, except
when your investment is in an IRA, 401(k) or other tax-advantaged investment
plan. However, you may be subject to tax when you withdraw monies from a
tax-advantaged plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If
you purchase shares (other than Class Y shares) through a broker-dealer or other
financial intermediary (such as a bank), the fund and its related companies may
pay the intermediary for the sale of fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your salesperson to recommend the fund over another
investment. Ask your salesperson or visit your financial intermediary’s web site
for more information.
|
| |
6
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
|
|
|
|
|
|
|
|
| |
Class |
Investor |
I |
Y |
Ticker |
DHPAX |
DHPIX |
DHPYX |
Investment Objective
The investment objective of
the Diamond Hill Mid Cap Fund is to provide long-term capital
appreciation.
Fees and Expenses of the Fund
This table describes the fees
and expenses that you may pay if you buy and hold shares of the fund. You may
pay other fees, such as brokerage commissions and other fees to financial
intermediaries, which are not reflected in the tables and examples
below.
|
| |
SHAREHOLDER FEES (fees paid directly from
your investment) |
|
None |
|
|
|
|
|
|
|
|
|
|
| |
ANNUAL FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your
investment) |
|
Investor |
Class I |
Class Y |
Management
fees |
0.60 |
% |
0.60 |
% |
0.60 |
% |
Distribution
(12b-1) fees |
0.25 |
% |
None |
None |
Other
expenses |
0.21 |
% |
0.17 |
% |
0.05 |
% |
Total
annual fund operating expenses |
1.06 |
% |
0.77 |
% |
0.65 |
% |
This Example is
intended to help you compare the cost of investing in the fund with the cost of
investing in other mutual funds. The Example assumes that you invest $10,000 in
the fund for the time periods indicated and then redeem all of your shares at
the end of those periods. The Example also assumes that your investment has a 5%
return each year and that the fund’s operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
1 Year |
3 Years |
5
Years |
10
Years |
Investor |
| $108 |
| $337 |
| $585 |
| $1,294 |
|
Class I |
| 79 |
| 246 |
| 428 |
| 954 |
|
Class
Y |
| 66 |
| 208 |
| 362 |
| 810 |
|
The fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the fund’s performance. During the most recent fiscal
year, the fund’s portfolio turnover rate was 19% of the average value of
its portfolio.
Principal Investment
Strategy
The
fund, under normal market conditions, invests at least 80% of its net assets in
U.S. equity securities with medium market capitalizations that Diamond Hill
Capital Management, Inc. (the "Adviser”) believes are undervalued. Equity
securities consist of common and preferred stocks. Mid cap companies are defined
as companies with market capitalizations at the time of purchase between
$1.5 billion and $20 billion or in the range of those market
capitalizations of companies included in the Russell Midcap Index at the time of
purchase. The
capitalization range of the Russell Midcap Index is between $450.1 million and
$53.9 billion as of January 31, 2023.
The size of the companies included in the Russell Midcap Index will change with
market conditions.
The
Adviser focuses on estimating a company’s value independent of its current stock
price. To estimate a company’s value, the Adviser concentrates on the
fundamental economic drivers of the business. The primary focus is on
“bottom-up” analysis, which takes into consideration earnings, revenue growth,
operating margins and other economic factors. The Adviser also considers the
level of industry competition, regulatory factors, the threat of technological
obsolescence, and a variety of other industry factors. If the Adviser’s estimate
of a company’s value differs sufficiently from the current market price, the
company may be an attractive investment opportunity. In constructing a portfolio
of securities, the Adviser is not constrained by the sector or industry weights
in the benchmark. The Adviser relies on individual stock selection and
discipline in the investment process to add value. The highest portfolio
security weights are assigned to companies where the Adviser has the highest
level of conviction.
Once
a stock is selected, the Adviser continues to monitor the company’s strategies,
financial performance and competitive environment. The Adviser may sell a
security as it reaches the Adviser’s estimate of the company’s value if it
believes that the company’s earnings, revenue growth, operating margin or other
economic factors are deteriorating or if it identifies a stock that it believes
offers a better investment opportunity.
Main Risks
All
investments carry a certain amount of risk and the fund cannot guarantee that it
will achieve its investment objective. An investment in the fund is not a
deposit or obligation of any bank, is not endorsed or guaranteed by any bank,
and is not insured by the Federal Deposit Insurance Corporation (FDIC) or any
other government agency. You may lose money by investing in the
fund. Below are the main risks of investing in the fund. All of
the risks listed below are significant to the fund, regardless of the order in
which they appear.
Management
Risk The
Adviser’s judgments about the attractiveness, value and potential appreciation
of a particular asset class or individual security in which the fund invests may
prove to be incorrect and there is no guarantee that individual companies will
perform as anticipated. The value of an individual company can be more volatile
than the market as a whole, and the Adviser’s intrinsic value-oriented approach
may fail to produce the intended
results.
|
| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 7 |
|
|
|
|
| |
Diamond
Hill Mid Cap Fund Summary |
As
of February 28, 2023 |
Market
Risk The
value of the fund's investments may decrease, sometimes rapidly or unexpectedly,
due to factors affecting an issuer held by the fund, particular industries or
overall securities markets. When the value of the fund’s investments goes down,
your investment in the fund decreases in value. A variety of factors including
interest rate levels, recessions, inflation, U.S. economic growth, war or acts
of terrorism, natural disasters, political events, supply chain disruptions,
staff shortages and widespread public health issues affect the securities
markets. These events may cause volatility, severe market dislocations and
liquidity constraints in many markets, including markets for the securities the
fund holds, and may adversely affect the fund's investments and operations. In
addition, governmental responses to these events may negatively impact the
capabilities of the fund's service providers, disrupt the fund's operations,
result in substantial market volatility and adversely impact the prices and
liquidity of the fund's investments.
Mid Cap Company
Risk Investments in mid cap
companies may be riskier than investments in larger, more established companies.
The securities of these companies may trade less frequently and in smaller
volumes than securities of larger companies. In addition, mid cap companies may
be more vulnerable to economic, market and industry changes. As a result, share
price changes may be more sudden or erratic than the prices of other equity
securities, especially over the short term. Because smaller companies may have
limited product lines, markets or financial resources or may depend on a few key
employees, they may be more susceptible to particular economic events or
competitive factors than large capitalization companies.
Performance
The
following bar chart and table show two aspects of the fund: volatility and
performance. The bar chart
shows the volatility — or variability — of the fund’s annual total returns over
time, and shows that fund performance can change from year to
year. The table shows the fund’s average annual total returns
for certain time periods compared to the returns of a broad-based securities
index. The bar chart and table provide some indication of the risks of investing
in the fund. Of course, the fund’s past
performance is not necessarily an indication of its future
performance. Updated
performance information is available at no cost by visiting www.diamond-hill.com
or by calling 888-226-5595.
CLASS I ANNUAL TOTAL RETURN-YEARS ENDED
12/31
|
|
|
|
| |
Best
Quarter: |
4Q 2020, +22.19% |
Worst
Quarter: |
1Q 2020, -36.76% |
|
| |
AVERAGE
ANNUAL TOTAL RETURNS AS OF
12/31/22 |
After-tax returns are
calculated using the highest historical individual federal marginal income tax
rate and do not reflect the impact of state and local taxes.
Actual after-tax returns
depend on a shareholder's tax situation and may differ from those shown.
After-tax returns are not relevant for shareholders who hold fund shares in
tax-deferred accounts or to shares held by non-taxable entities.
After-tax returns are shown
for Class I shares only and will vary from the after-tax returns for the other
share classes.
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Inception Date of Class |
One Year |
Five
Year |
Since Inception |
Class I
Before Taxes |
12/31/13 |
(13.39) |
% |
4.74 |
% |
6.71 |
% |
After Taxes on
Distributions |
| (14.55) |
| 4.14 |
| 6.28 |
|
After Taxes on Distributions
and Sale of Fund Shares |
| (7.31) |
| 3.62 |
| 5.35 |
|
Investor
Before Taxes |
12/31/13 |
(13.66) |
| 4.42 |
| 6.40 |
|
Class Y
Before Taxes |
12/31/13 |
(13.31) |
| 4.85 |
| 6.82 |
|
Russell Midcap
Index |
| (17.32) |
| 7.10 |
| 8.59 |
|
The Russell Midcap
Index measures the performance of roughly 800 US mid-cap companies. The index is
unmanaged, market capitalization weighted, includes net reinvested dividends,
does not reflect fees or expenses (which would lower the return), and is not
available for direct investment.
Portfolio
Management
Investment
Adviser
Diamond
Hill Capital Management, Inc.
Portfolio
Managers
Christopher
Welch
Portfolio
Manager
Since
12/2013
Christopher
Bingaman
Assistant
Portfolio Manager
since
12/2013
|
| |
8
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
|
|
| |
Diamond
Hill Mid Cap Fund Summary |
As
of February 28, 2023 |
Buying
and Selling Fund Shares
Minimum
Initial Investment
Investor
and I: $2,500
Class
Y: $500,000
|
|
|
|
| |
To Place Orders |
Mail:
Diamond
Hill Mid Cap Fund
P.O.
Box 46707
Cincinnati,
OH 45246
Phone:
888-226-5595 |
Transaction
Policies
In
general, you can buy or sell (redeem) shares of the fund by mail or phone on any
business day. You can generally pay for shares by check or wire. You may be
charged wire fees or other transaction fees; ask your financial professional.
When selling shares, you will receive a check, unless you request a wire. You
may also buy and sell shares through a financial professional.
Dividends,
Capital Gains and Taxes
The
fund’s distributions may be taxable as ordinary income or capital gains, except
when your investment is in an IRA, 401(k) or other tax-advantaged investment
plan. However, you may be subject to tax when you withdraw monies from a
tax-advantaged plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If
you purchase shares (other than Class Y shares) through a broker-dealer or other
financial intermediary (such as a bank), the fund and its related companies may
pay the intermediary for the sale of fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your salesperson to recommend the fund over another
investment. Ask your salesperson or visit your financial intermediary’s web site
for more information.
|
| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 9 |
|
|
|
|
|
|
|
|
|
|
| |
Class |
Investor |
I |
Y |
Ticker |
DHLAX |
DHLRX |
DHLYX |
Investment Objective
The investment objective of
the Diamond Hill Large Cap Fund is to provide long-term capital
appreciation.
Fees and Expenses of the
Fund
This table describes the fees
and expenses that you may pay if you buy and hold shares of the fund. You may
pay other fees, such as brokerage commissions and other fees to financial
intermediaries, which are not reflected in the tables and examples
below.
|
| |
SHAREHOLDER FEES (fees paid directly from
your investment) |
|
None |
|
|
|
|
|
|
|
|
|
|
| |
ANNUAL FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your
investment) |
| Investor |
Class I |
Class Y |
Management
fees |
0.50 |
% |
0.50 |
% |
0.50 |
% |
Distribution
(12b-1) fees |
0.25 |
% |
None |
None |
Other
expenses |
0.21 |
% |
0.17 |
% |
0.05 |
% |
Total
annual fund operating expenses |
0.96 |
% |
0.67 |
% |
0.55 |
% |
This Example is
intended to help you compare the cost of investing in the fund with the cost of
investing in other mutual funds. The Example assumes that you invest $10,000 in
the fund for the time periods indicated and then redeem all of your shares at
the end of those periods. The Example also assumes that your investment has a 5%
return each year and that the fund’s operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
1 Year |
3 Years |
5 Years |
10 Years |
Investor |
$98 |
| $306 |
| $531 |
| $1,178 |
|
Class I |
68 |
| 214 |
| 373 |
| 835 |
|
Class
Y |
56 |
| 176 |
| 307 |
| 689 |
|
The fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the fund’s performance. During the most recent fiscal
year, the fund’s portfolio turnover rate was 38% of the average value of
its portfolio.
Principal Investment
Strategy
The
fund, under normal market conditions, invests at least 80% of its net assets in
U.S. equity securities with large market capitalizations ("large cap") that
Diamond Hill Capital Management, Inc. (the "Adviser”) believes are undervalued.
Equity securities consist of common and preferred stocks. Large cap companies
are defined as companies with market capitalizations at the time of purchase of
$5 billion or greater, or in the range of those market capitalizations of
companies included in the Russell 1000 Index at the time of purchase.
The
capitalization range of the Russell 1000 Index is between $450.1 million and
$2,285.0 billion as of January 31, 2023.
The size of the companies included in the Russell 1000 Index will change with
market conditions.
The
Adviser focuses on estimating a company’s value independent of its current stock
price. To estimate a company’s value, the Adviser concentrates on the
fundamental economic drivers of the business. The primary focus is on
“bottom-up” analysis, which takes into consideration earnings, revenue growth,
operating margins and other economic factors. The Adviser also considers the
level of industry competition, regulatory factors, the threat of technological
obsolescence, and a variety of other industry factors. If the Adviser’s estimate
of a company’s value differs sufficiently from the current market price, the
company may be an attractive investment opportunity. In constructing a portfolio
of securities, the Adviser is not constrained by the sector or industry weights
in the benchmark. The Adviser relies on individual stock selection and
discipline in the investment process to add value. The highest portfolio
security weights are assigned to companies where the Adviser has the highest
level of conviction.
Once
a stock is selected, the Adviser continues to monitor the company’s strategies,
financial performance and competitive environment. The Adviser may sell a
security as it reaches the Adviser’s estimate of the company’s value if it
believes that the company’s earnings, revenue growth, operating margin or other
economic factors are deteriorating or if it identifies a stock that it believes
offers a better investment opportunity.
Main Risks
All investments carry a certain
amount of risk and the fund cannot guarantee that it will achieve its investment
objective. An investment in the fund is not
a deposit or obligation of any bank, is not endorsed or guaranteed by any bank,
and is not
|
| |
10
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
|
|
| |
Diamond
Hill Large Cap Fund Summary |
As
of February 28, 2023 |
insured by the Federal Deposit Insurance
Corporation (FDIC) or any other government agency.
You may lose money by investing in the
fund. Below are the main risks of investing in the fund. All of
the risks listed below are significant to the fund, regardless of the order in
which they appear.
Management
Risk The
Adviser’s judgments about the attractiveness, value and potential appreciation
of a particular asset class or individual security in which the fund invests may
prove to be incorrect and there is no guarantee that individual companies will
perform as anticipated. The value of an individual company can be more volatile
than the market as a whole, and the Adviser’s intrinsic value-oriented approach
may fail to produce the intended results.
Market Risk
The value of the fund's investments
may decrease, sometimes rapidly or unexpectedly, due to factors affecting an
issuer held by the fund, particular industries or overall securities markets.
When the value of the fund’s investments goes down, your investment in the fund
decreases in value. A variety of factors including interest rate levels,
recessions, inflation, U.S. economic growth, war or acts of terrorism, natural
disasters, political events, supply chain disruptions, staff shortages and
widespread public health issues affect the securities markets. These events may
cause volatility, severe market dislocations and liquidity constraints in many
markets, including markets for the securities the fund holds, and may adversely
affect the fund's investments and operations. In addition, governmental
responses to these events may negatively impact the capabilities of the fund's
service providers, disrupt the fund's operations, result in substantial market
volatility and adversely impact the prices and liquidity of the fund's
investments.
Performance
The following bar chart and
table show two aspects of the fund: volatility and performance. The bar chart
shows the volatility — or variability — of the fund’s annual
total returns over time, and shows that fund performance can change from year to
year. The table shows the fund’s average annual total returns
for certain time periods compared to the returns of a broad-based securities
index. The bar chart and table provide some indication of the risks of investing
in the fund. Of course, the fund’s past
performance is not necessarily an indication of its future
performance. Updated performance information is
available at no cost by visiting www.diamond-hill.com
or by calling 888-226-5595.
CLASS I ANNUAL TOTAL RETURN-YEARS ENDED
12/31
|
|
|
|
| |
Best
Quarter: |
2Q 2020, +18.06% |
Worst
Quarter: |
1Q 2020, -26.82% |
|
| |
AVERAGE
ANNUAL TOTAL RETURNS AS OF
12/31/22 |
After-tax returns are
calculated using the highest historical individual federal marginal income tax
rate and do not reflect the impact of state and local taxes.
Actual after-tax returns
depend on a shareholder's tax situation and may differ from those shown.
After-tax returns are not relevant for shareholders who hold fund shares in
tax-deferred accounts or to shares held by non-taxable entities.
After-tax returns are shown
for Class I shares only and will vary from the after-tax returns for the other
share classes.
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Inception Date of Class |
One Year |
Five Year |
Ten Year |
Class I
Before Taxes |
1/31/05 |
(13.38) |
% |
7.23 |
% |
11.36 |
% |
After Taxes on
Distributions |
| (14.64) |
| 5.92 |
| 10.01 |
|
After Taxes on Distributions and Sale
of Fund Shares |
| (6.98) |
| 5.62 |
| 9.18 |
|
Investor
Before Taxes |
6/29/01 |
(13.66) |
| 6.92 |
| 11.05 |
|
Class Y
Before Taxes |
12/30/11 |
(13.27) |
| 7.35 |
| 11.49 |
|
Russell 1000
Index |
| (19.13) |
| 9.13 |
| 12.37 |
|
The Russell 1000 Index
measures the performance of roughly 1,000 US large-cap companies. The index is
unmanaged, market capitalization weighted, includes net reinvested dividends,
does not reflect fees or expenses (which would lower the return), and is not
available for direct investment.
|
| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 11 |
|
|
|
|
| |
Diamond
Hill Large Cap Fund Summary |
As
of February 28, 2023 |
Portfolio
Management
Investment
Adviser
Diamond
Hill Capital Management, Inc.
Portfolio
Managers
Charles
Bath
Portfolio
Manager
since
10/2002
Austin
Hawley
Portfolio
Manager
since
2/2015
Buying
and Selling Fund Shares
Minimum
Initial Investment
Investor
and I: $2,500
Class
Y: $500,000
|
|
|
|
| |
To Place Orders |
Mail:
Diamond
Hill Large Cap Fund
P.O.
Box 46707
Cincinnati,
OH 45246
Phone:
888-226-5595 |
Transaction
Policies
In
general, you can buy or sell (redeem) shares of the fund by mail or phone on any
business day. You can generally pay for shares by check or wire. You may be
charged wire fees or other transaction fees; ask your financial professional.
When selling shares, you will receive a check, unless you request a wire. You
may also buy and sell shares through a financial professional.
Dividends,
Capital Gains and Taxes
The
fund’s distributions may be taxable as ordinary income or capital gains, except
when your investment is in an IRA, 401(k) or other tax-advantaged investment
plan. However, you may be subject to tax when you withdraw monies from a
tax-advantaged plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If
you purchase shares (other than Class Y shares) through a broker-dealer or other
financial intermediary (such as a bank), the fund and its related companies may
pay the intermediary for the sale of fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your salesperson to recommend the fund over another
investment. Ask your salesperson or visit your financial intermediary’s web site
for more information.
|
| |
12
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
|
|
|
|
|
|
|
|
| |
Class |
Investor |
I |
Y |
Ticker |
DHFAX |
DHFIX |
DHFYX |
Investment Objective
The investment objective of
the Diamond Hill Large Cap Concentrated Fund is to provide long-term capital
appreciation.
Fees and Expenses of the
Fund
This table describes the fees
and expenses that you may pay if you buy and hold shares of the fund. You may
pay other fees, such as brokerage commissions and other fees to financial
intermediaries, which are not reflected in the tables and examples
below.
|
| |
SHAREHOLDER FEES (fees paid directly from
your investment) |
|
None |
|
|
|
|
|
|
|
|
|
|
| |
ANNUAL FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your
investment) |
| Investor |
Class I |
Class Y |
Management
fees |
0.50 |
% |
0.50 |
% |
0.50 |
% |
Distribution
(12b-1) fees |
0.25 |
% |
None |
None |
Other
expenses |
0.22 |
% |
0.18 |
% |
0.06 |
% |
Total
annual fund operating expenses |
0.97 |
% |
0.68 |
% |
0.56 |
% |
This Example is
intended to help you compare the cost of investing in the fund with the cost of
investing in other mutual funds. The Example assumes that you invest $10,000 in
the fund for the time periods indicated and then redeem all of your shares at
the end of those periods. The Example also assumes that your investment has a 5%
return each year and that the fund’s operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| 1 Year |
3 Years |
5 Years |
10 Years |
Investor |
$99 |
| $309 |
| $536 |
| $1,190 |
|
Class I |
69 |
| 218 |
| 379 |
| 847 |
|
Class Y |
57 |
| 179 |
| 313 |
| 701 |
|
The
fund pays transaction costs, such as commissions, when it buys and sells
securities (or “turns over” its portfolio). A higher portfolio turnover rate may
indicate higher transaction costs and may result in higher taxes when fund
shares are held in a taxable account. These costs, which are not reflected in
annual fund operating expenses or in the Example, affect the fund’s performance.
During
the most recent fiscal year, the fund's portfolio turnover rate was
41% of the average value of its
portfolio.
Principal Investment Strategy
The
fund, under normal market conditions, invests at least 80% of its net assets in
U.S. equity securities with large market capitalizations ("large cap") that
Diamond Hill Capital Management, Inc. (the “Adviser”) believes are undervalued.
Equity securities consist of common and preferred stocks. Large cap companies
are defined as companies with market capitalizations of $15 billion or greater
at the time of purchase. The fund is non-diversified and intends to concentrate
its investments in approximately 20 securities.
The
Adviser focuses on estimating a company’s value independent of its current stock
price. To estimate a company’s value, the Adviser concentrates on the
fundamental economic drivers of the business. The primary focus is on
“bottom-up” analysis, which takes into consideration earnings, revenue growth,
operating margins and other economic factors. The Adviser also considers the
level of industry competition, regulatory factors, the threat of technological
obsolescence, and a variety of other industry factors. If the Adviser’s estimate
of a company’s value differs sufficiently from the current market price, the
company may be an attractive investment opportunity. In constructing a portfolio
of securities, the Adviser is not constrained by the sector or industry weights
in the benchmark. The Adviser relies on individual stock selection and
discipline in the investment process to add value. The highest portfolio
security weights are assigned to companies where the Adviser has the highest
level of conviction.
Once
a stock is selected, the Adviser continues to monitor the company’s strategies,
financial performance and competitive environment. The Adviser may sell a
security as it reaches the Adviser’s estimate of the company’s value if it
believes that the company’s earnings, revenue growth, operating margin or other
economic factors are deteriorating, or if it identifies a stock that it believes
offers a better investment opportunity.
Main Risks
All investments carry a certain
amount of risk and the fund cannot guarantee that it will achieve its investment
objective. An investment in the fund is not a
deposit or obligation of any bank, is not endorsed or guaranteed by any bank,
and is not insured by the Federal Deposit Insurance Corporation (FDIC) or any
other government agency. You may lose money by investing in the
fund. Below are the main risks of investing in the fund. All of
the risks listed below are significant to the fund, regardless of the order in
which they appear.
|
| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 13 |
|
|
|
|
| |
Diamond
Hill Large Cap Concentrated Fund Summary |
As
of February 28, 2023 |
Focused
Portfolio Risk The
fund may have more volatility and is considered to have more risk than a fund
that invests in securities of a greater number of issuers because changes in the
value of a single issuer's security may have a more significant effect, either
positive or negative, on the fund's net asset value.
Management
Risk The
Adviser’s judgments about the attractiveness, value and potential appreciation
of a particular asset class or individual security in which the fund invests may
prove to be incorrect and there is no guarantee that individual companies will
perform as anticipated. The value of an individual company can be more volatile
than the market as a whole, and the Adviser’s intrinsic value-oriented approach
may fail to produce the intended results.
Market
Risk
The value of the fund's investments may decrease, sometimes rapidly or
unexpectedly, due to factors affecting an issuer held by the fund, particular
industries or overall securities markets. When the value of the fund’s
investments goes down, your investment in the fund decreases in value. A variety
of factors including interest rate levels, recessions, inflation, U.S. economic
growth, war or acts of terrorism, natural disasters, political events, supply
chain disruptions, staff shortages and widespread public health issues affect
the securities markets. These events may cause volatility, severe market
dislocations and liquidity constraints in many markets, including markets for
the securities the fund holds, and may adversely affect the fund's investments
and operations. In addition, governmental responses to these events may
negatively impact the capabilities of the fund's service providers, disrupt the
fund's operations, result in substantial market volatility and adversely impact
the prices and liquidity of the fund's investments.
Sector
Emphasis Risk
The fund, from time to time, may invest 25%
or more of its assets in one or more sectors, subjecting the fund to sector
emphasis risk. This is the risk that the fund is subject to a greater risk of
loss as a result of adverse economic, business or other developments affecting a
specific sector in which the fund has a focused position, than if its
investments were diversified across a greater number of industry sectors. Some
sectors possess particular risks that may not affect
other sectors.
Performance
The following bar chart and
table show two aspects of the fund: volatility and performance. The bar chart
shows the volatility — or variability — of the fund’s annual
total returns over time, and shows that fund performance can change from year to
year. The table shows the fund’s average annual total returns
for certain time periods compared to the returns of a broad-based securities
index. The bar chart and table provide some indication of the risks of investing
in the fund. Of course, the fund’s past
performance is not necessarily an indication of its future
performance. Updated performance information is
available at no cost by visiting www.diamond-hill.com
or by calling 888-226-5595.
CLASS I ANNUAL TOTAL RETURN-YEARS ENDED
12/31
|
|
|
|
| |
Best
Quarter: |
4Q 2022, +12.19% |
Worst
Quarter: |
2Q 2022, -15.55% |
|
| |
AVERAGE
ANNUAL TOTAL RETURNS AS OF
12/31/22 |
After-tax returns are
calculated using the highest historical individual federal marginal income tax
rate and do not reflect the impact of state and local taxes.
Actual after-tax returns
depend on a shareholder's tax situation and may differ from those shown.
After-tax returns are not relevant for shareholders who hold fund shares in
tax-deferred accounts or to shares held by non-taxable entities.
After-tax returns are shown
for Class I shares only and will vary from the after-tax returns for the other
share classes.
|
|
|
|
|
|
|
|
|
|
| |
| Inception Date of Class |
One Year |
Since
Inception |
Class I
Before Taxes |
2/26/21 |
(12.75) |
% |
2.95 |
% |
After Taxes on
Distributions |
| (13.16) |
| 2.56 |
|
After Taxes on Distributions and Sale
of Fund Shares |
| (7.55) |
| 2.22 |
|
Investor
Before Taxes |
2/26/21 |
(12.93) |
| 2.66 |
|
Class Y
Before Taxes |
2/26/21 |
(12.62) |
| 3.06 |
|
Russell 1000
Index |
| (19.13) |
| 0.12 |
|
The Russell 1000 Index
measures the performance of roughly 1,000 US large-cap companies. The index is
unmanaged, market capitalization weighted, includes net reinvested dividends,
does not reflect fees or expenses (which would lower the return), and is not
available for direct investment.
|
| |
14
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
|
|
| |
Diamond
Hill Large Cap Concentrated Fund Summary |
As
of February 28, 2023 |
Portfolio
Management
Investment
Adviser
Diamond
Hill Capital Management, Inc.
Portfolio
Manager
Charles
Bath
Portfolio
Manager
since
02/2021
Austin
Hawley
Portfolio
Manager
since
02/2021
Buying
and Selling Fund Shares
Minimum
Initial Investment
Investor
and Class I: $2,500
Class
Y: $500,000
|
|
|
|
| |
To Place Orders |
Mail: Diamond
Hill Large Cap Concentrated Fund P.O. Box 46707 Cincinnati,
OH 45246 Phone: 888-226-5595 |
Transaction
Policies
In
general, you can buy or sell (redeem) shares of the fund by mail or phone on any
business day. You can generally pay for shares by check or wire. You may be
charged wire fees or other transaction fees; ask your financial professional.
When selling shares, you will receive a check, unless you request a wire. You
may also buy and sell shares through a financial professional.
Dividends,
Capital Gains and Taxes
The
fund’s distributions may be taxable as ordinary income or capital gains, except
when your investment is in an IRA, 401(k) or other tax-advantaged investment
plan. However, you may be subject to tax when you withdraw monies from a
tax-advantaged plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If
you purchase shares (other than Class Y shares) through a broker-dealer or other
financial intermediary (such as a bank), the fund and its related companies may
pay the intermediary for the sale of fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your salesperson to recommend the fund over another
investment. Ask your salesperson or visit your financial intermediary’s web site
for more information.
|
| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 15 |
|
|
|
|
|
|
|
|
|
|
| |
Class |
Investor |
I |
Y |
Ticker |
DHTAX |
DHLTX |
DHTYX |
Investment Objective
The investment objective of
the Diamond Hill Select Fund is to provide long-term capital
appreciation.
Fees and Expenses of the
Fund
This table describes the fees
and expenses that you may pay if you buy and hold shares of the fund. You may
pay other fees, such as brokerage commissions and other fees to financial
intermediaries, which are not reflected in the tables and examples
below.
|
| |
SHAREHOLDER FEES (fees paid
directly from your investment) |
|
None |
|
|
|
|
|
|
|
|
|
|
| |
ANNUAL FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your
investment) |
| Investor |
Class I |
Class Y |
Management
fees |
0.70 |
% |
0.70 |
% |
0.70 |
% |
Distribution
(12b-1) fees |
0.25 |
% |
None |
None |
Other
expenses |
0.21 |
% |
0.17 |
% |
0.05 |
% |
Total
annual fund operating expenses |
1.16 |
% |
0.87 |
% |
0.75 |
% |
This Example is
intended to help you compare the cost of investing in the fund with the cost of
investing in other mutual funds. The Example assumes that you invest $10,000 in
the fund for the time periods indicated and then redeem all of your shares at
the end of those periods. The Example also assumes that your investment has a 5%
return each year and that the fund’s operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
1 Year |
3 Years |
5 Years |
10 Years |
Investor |
$118 |
| $368 |
| $638 |
| $1,409 |
|
Class I |
89 |
| 278 |
| 482 |
| 1,073 |
|
Class Y |
77 |
| 240 |
| 417 |
| 930 |
|
The fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the fund’s performance. During the most recent fiscal
year, the fund’s portfolio turnover rate was 78% of the average value of
its portfolio.
Principal Investment
Strategy
The
fund, under normal market conditions, invests its assets in U.S. equity
securities of any size capitalization that Diamond Hill Capital Management, Inc.
(the "Adviser”) believes are undervalued. Equity securities consist of common
and preferred stocks. The fund is non-diversified and intends to concentrate its
investments in 30 to 40 select securities. Effective
April 30, 2023, the fund intends to concentrate its investments in a limited
number of securities.
The
Adviser focuses on estimating a company’s value independent of its current stock
price. To estimate a company’s value, the Adviser concentrates on the
fundamental economic drivers of the business. The primary focus is on
“bottom-up” analysis, which takes into consideration earnings, revenue growth,
operating margins and other economic factors. The Adviser also considers the
level of industry competition, regulatory factors, the threat of technological
obsolescence, and a variety of other industry factors. If the Adviser’s estimate
of a company’s value differs sufficiently from the current market price, the
company may be an attractive investment opportunity. In constructing a portfolio
of securities, the Adviser is not constrained by the sector or industry weights
in the benchmark. The Adviser relies on individual stock selection and
discipline in the investment process to add value. The highest portfolio
security weights are assigned to companies where the Adviser has the highest
level of conviction.
Once a stock is selected, the Adviser
continues to monitor the company’s strategies, financial performance and
competitive environment. The Adviser may sell a security as it reaches the
Adviser’s estimate of the company’s value if it believes that the company’s
earnings, revenue growth, operating margin or other economic factors are
deteriorating or if it identifies a stock that it believes offers a better
investment opportunity.
Main Risks
All
investments carry a certain amount of risk and the fund cannot guarantee that it
will achieve its investment objective. An investment in the fund is not a
deposit or obligation of any bank, is not endorsed or guaranteed by any bank,
and is not insured by the Federal Deposit Insurance Corporation (FDIC) or any
other government agency. You may lose money by investing in the
fund. Below are the main risks of investing in the fund. All of
the risks listed below are significant to the fund, regardless of the order in
which they appear.
Focused
Portfolio Risk The
fund may have more volatility and is considered to have more risk than a fund
that invests in
|
| |
16
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
|
|
| |
Diamond
Hill Select Fund Summary |
As
of February 28, 2023 |
securities
of a greater number of issuers because changes in the value of a single issuer's
security may have a more significant effect, either positive or negative, on the
fund's net asset value.
Management
Risk The
Adviser’s judgments about the attractiveness, value and potential appreciation
of a particular asset class or individual security in which the fund invests may
prove to be incorrect and there is no guarantee that individual companies will
perform as anticipated. The value of an individual company can be more volatile
than the market as a whole, and the Adviser’s intrinsic value-oriented approach
may fail to produce the intended results.
Market
Risk The
value of the fund's investments may decrease, sometimes rapidly or unexpectedly,
due to factors affecting an issuer held by the fund, particular industries or
overall securities markets. When the value of the fund’s investments goes down,
your investment in the fund decreases in value. A variety of factors including
interest rate levels, recessions, inflation, U.S. economic growth, war or acts
of terrorism, natural disasters, political events, supply chain disruptions,
staff shortages and widespread public health issues affect the securities
markets. These events may cause volatility, severe market dislocations and
liquidity constraints in many markets, including markets for the securities the
fund holds, and may adversely affect the fund's investments and operations. In
addition, governmental responses to these events may negatively impact the
capabilities of the fund's service providers, disrupt the fund's operations,
result in substantial market volatility and adversely impact the prices and
liquidity of the fund's investments.
Sector
Emphasis Risk
The
fund, from time to time, may invest 25% or more of its assets in one or more
sectors, subjecting the fund to sector emphasis risk. This is the risk that the
fund is subject to a greater risk of loss as a result of adverse economic,
business or other developments affecting a specific sector in which the fund has
a focused position, than if its investments were diversified across a greater
number of industry sectors. Some sectors possess particular risks that may not
affect other sectors.
Small
Cap and Mid Cap Company Risk Investments
in small cap and mid cap companies may be riskier than investments in larger,
more established companies. The securities of these companies may trade less
frequently and in smaller volumes than securities of larger companies. In
addition, small cap and mid cap companies may be more vulnerable to economic,
market and industry changes. As a result, share price changes may be more sudden
or erratic than the prices of other equity securities, especially over the short
term. Because smaller companies may have limited product lines, markets or
financial resources or may depend on a few key employees, they may be more
susceptible to particular economic events or competitive factors than large
capitalization companies.
Performance
The
following bar chart and table show two aspects of the fund: volatility and
performance. The bar chart
shows the volatility — or variability — of the fund’s annual total returns over
time, and shows that fund performance can change from year to
year. The table shows the fund’s average annual total returns
for certain time periods compared to the returns of a broad-based securities
index. The bar chart and table provide some indication of the risks of investing
in the fund. Of course, the fund’s past
performance is not necessarily an indication of its future
performance.
Updated performance information is available at no cost by visiting
www.diamond-hill.com
or by calling 888-226-5595.
CLASS I ANNUAL TOTAL RETURN-YEARS ENDED
12/31
|
|
|
|
| |
Best
Quarter: |
4Q 2020, +24.65% |
Worst
Quarter: |
1Q 2020, -34.01% |
|
| |
AVERAGE
ANNUAL TOTAL RETURNS AS OF
12/31/2022 |
After-tax returns are
calculated using the highest historical individual federal marginal income tax
rate and do not reflect the impact of state and local taxes.
Actual after-tax returns
depend on a shareholder's tax situation and may differ from those shown.
After-tax returns are not relevant for shareholders who hold fund shares in
tax-deferred accounts or to shares held by non-taxable entities.
After-tax returns are shown
for Class I shares only and will vary from the after-tax returns for the other
share classes.
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Inception
Date of Class |
One Year |
Five Year |
Ten Year |
Class I
Before Taxes |
12/30/05 |
(17.20) |
% |
7.80 |
% |
11.82 |
% |
After Taxes on
Distributions |
| (18.02) |
| 6.18 |
| 10.08 |
|
After Taxes on Distributions and Sale
of Fund Shares |
| (9.63) |
| 5.93 |
| 9.30 |
|
Investor
Before Taxes |
12/30/05 |
(17.44) |
| 7.48 |
| 11.51 |
|
Class Y
Before Taxes |
12/30/11 |
(17.10) |
| 7.93 |
| 11.97 |
|
Russell 3000
Index |
| (19.21) |
| 8.79 |
| 12.13 |
|
The Russell 3000 Index
measures the performance of roughly 3,000 of the largest US companies. The index
is unmanaged, market capitalization weighted, includes net reinvested dividends,
does not reflect fees or expenses (which would lower the return), and is not
available for direct investment.
|
| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 17
|
|
|
|
|
| |
Diamond
Hill Select Fund Summary |
As
of February 28, 2023 |
Portfolio
Management
Investment
Adviser
Diamond
Hill Capital Management, Inc.
Portfolio
Managers
Austin
Hawley
Portfolio
Manager
since
1/2013
Richard
Snowdon
Portfolio
Manager
since
1/2013
Buying
and Selling Fund Shares
Minimum
Initial Investment
Investor
and Class I: $2,500
Class
Y: $500,000
|
|
|
|
| |
To Place Orders |
Mail: Diamond
Hill Select Fund P.O. Box 46707 Cincinnati, OH 45246 Phone:
888-226-5595 |
Transaction
Policies
In
general, you can buy or sell (redeem) shares of the fund by mail or phone on any
business day. You can generally pay for shares by check or wire. You may be
charged wire fees or other transaction fees; ask your financial professional.
When selling shares, you will receive a check, unless you request a wire. You
may also buy and sell shares through a financial professional.
Dividends,
Capital Gains and Taxes
The
fund’s distributions may be taxable as ordinary income or capital gains, except
when your investment is in an IRA, 401(k) or other tax-advantaged investment
plan. However, you may be subject to tax when you withdraw monies from a
tax-advantaged plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If
you purchase shares (other than Class Y shares) through a broker-dealer or other
financial intermediary (such as a bank), the fund and its related companies may
pay the intermediary for the sale of fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your salesperson to recommend the fund over another
investment. Ask your salesperson or visit your financial intermediary’s web site
for more information.
|
| |
18
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
|
|
|
|
|
|
|
|
| |
Class |
Investor |
I |
Y |
Ticker |
DIAMX |
DHLSX |
DIAYX |
Investment Objective
The investment objective of
the Diamond Hill Long-Short Fund is to provide long-term capital
appreciation.
Fees and Expenses of the
Fund
This table describes the fees
and expenses that you may pay if you buy and hold shares of the fund. You may
pay other fees, such as brokerage commissions and other fees to financial
intermediaries, which are not reflected in the tables and examples
below.
|
| |
SHAREHOLDER FEES (fees paid directly from
your investment) |
|
None |
|
|
|
|
|
|
|
|
|
|
| |
ANNUAL
FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your
investment) |
| Investor |
Class I |
Class Y |
Management
fees |
0.90 |
% |
0.90 |
% |
0.90 |
% |
Distribution
(12b-1) fees |
0.25 |
% |
None |
None |
Other
expenses |
|
| |
Administration
fees |
0.21 |
% |
0.17 |
% |
0.05 |
% |
Dividend
expenses and fees on short sales |
0.42 |
% |
0.42 |
% |
0.42 |
% |
Total
Other expenses |
0.63 |
% |
0.59 |
% |
0.47 |
% |
Acquired
fund fees and expenses |
0.01 |
% |
0.01 |
% |
0.01 |
% |
Total
annual fund operating expenses |
1.79 |
% |
1.50 |
% |
1.38 |
% |
This Example is
intended to help you compare the cost of investing in the fund with the cost of
investing in other mutual funds. The Example assumes that you invest $10,000 in
the fund for the time periods indicated and then redeem all of your shares at
the end of those periods. The Example also assumes that your investment has a 5%
return each year and that the fund’s operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| 1 Year |
3 Years |
5 Years |
10 Years |
Investor |
$182 |
| $563 |
| $970 |
| $2,105 |
|
Class I |
153 |
| 474 |
| 818 |
| 1,791 |
|
Class Y |
140 |
| 437 |
| 755 |
| 1,657 |
|
The fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the fund’s performance. During the most recent fiscal
year, the fund’s portfolio turnover rate was 61% of the average value of
its portfolio.
Principal Investment
Strategy
The
fund, under normal market conditions, invests its assets in U.S. equity
securities of any size capitalization that Diamond Hill Capital Management, Inc.
(the "Adviser”) believes are undervalued and selling short U.S. equity
securities of any size capitalization the Adviser believes are overvalued.
Equity securities consist of common and preferred stocks.
The
Adviser focuses on estimating a company’s value independent of its current stock
price. To estimate a company’s value, the Adviser concentrates on the
fundamental economic drivers of the business. The primary focus is on
“bottom-up” analysis, which takes into consideration earnings, revenue growth,
operating margins and other economic factors. The Adviser also considers the
level of industry competition, regulatory factors, the threat of technological
obsolescence, and a variety of other industry factors. If the Adviser’s estimate
of a company’s value differs sufficiently from the current market price, the
company may be an attractive investment opportunity. In constructing a portfolio
of securities, the Adviser is not constrained by the sector or industry weights
in the benchmark. The Adviser relies on individual stock selection and
discipline in the investment process to add value. The highest portfolio
security weights are assigned to companies where the Adviser has the highest
level of conviction.
The
fund also will sell securities short. Short sales are effected when it is
believed that the price of a particular security will decline, and involves the
sale of a security which the fund does not own in hopes of purchasing the same
security at a later date at a lower price. To make delivery to the buyer, the
fund must borrow the security, and the fund is obligated to return the security
to the lender, which is accomplished by a later purchase of the security by the
fund. The frequency of short sales will vary substantially in different periods,
and it is not intended that any specified portion of the fund’s assets will as a
matter of practice be invested in short sales. The fund will not make a short
sale if, immediately before the transaction, the market value of all securities
sold short exceeds 40% of the value of the fund’s net assets.
Once
a stock is purchased or sold short, the Adviser continues to monitor the
company’s strategies, financial performance and competitive environment. The
Adviser may sell a security (or repurchase a security sold short) as it reaches
the Adviser’s estimate of the company’s value if it believes that the company’s
earnings, revenue growth, operating margin or other economic factors are
deteriorating (or improving in the case of a short
|
| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 19 |
|
|
|
|
| |
Diamond
Hill Long-Short Fund Summary |
As
of February 28, 2023 |
sale); or, if it identifies a stock that it
believes offers a better investment opportunity.
Main Risks
All
investments carry a certain amount of risk and the fund cannot guarantee that it
will achieve its investment objective. An investment in the fund is not a
deposit or obligation of any bank, is not endorsed or guaranteed by any bank,
and is not insured by the Federal Deposit Insurance Corporation (FDIC) or any
other government agency. You may lose money by investing in the
fund. Below are the main risks of investing in the fund. All of
the risks listed below are significant to the fund, regardless of the order in
which they appear.
Management
Risk The
Adviser’s judgments about the attractiveness, value and potential appreciation
of a particular asset class or individual security in which the fund invests may
prove to be incorrect and there is no guarantee that individual companies will
perform as anticipated. The value of an individual company can be more volatile
than the market as a whole, and the Adviser’s intrinsic value-oriented approach
may fail to produce the intended results. In addition, there is no guarantee
that the use of long and short positions will succeed in limiting the fund’s
exposure to stock market movements, sector-swings or other risk factors. The
strategy used by the fund involves complex securities transactions that involve
risks different than direct equity investments.
Market
Risk
The value of the fund's investments may decrease, sometimes rapidly or
unexpectedly, due to factors affecting an issuer held by the fund, particular
industries or overall securities markets. When the value of the fund’s
investments goes down, your investment in the fund decreases in value. A variety
of factors including interest rate levels, recessions, inflation, U.S. economic
growth, war or acts of terrorism, natural disasters, political events, supply
chain disruptions, staff shortages and widespread public health issues affect
the securities markets. These events may cause volatility, severe market
dislocations and liquidity constraints in many markets, including markets for
the securities the fund holds, and may adversely affect the fund's investments
and operations. In addition, governmental responses to these events may
negatively impact the capabilities of the fund's service providers, disrupt the
fund's operations, result in substantial market volatility and adversely impact
the prices and liquidity of the fund's investments.
Short
Sale Risk The
fund will incur a loss as a result of a short sale if the price of the security
sold short increases in value between the date of the short sale and the date on
which the fund purchases the security to replace the borrowed security. In
addition, a lender may request, or market conditions may dictate, that
securities sold short be returned to the lender on short notice, and the fund
may have to buy the securities sold short at an unfavorable price. If this
occurs, any anticipated gain to the fund may be reduced or eliminated or the
short sale may result in a loss. The fund’s losses are potentially unlimited in
a short sale transaction. Short sales are speculative transactions and involve
special risks, including greater reliance on the Adviser’s ability to accurately
anticipate the future value of a security.
Small
Cap and Mid Cap Company Risk Investments
in small cap and mid cap companies may be riskier than investments in larger,
more established companies. The securities of these companies may trade less
frequently and in smaller volumes than securities of larger companies. In
addition, small cap and mid cap companies may be more vulnerable to economic,
market and industry changes. As a result, share price changes may be more sudden
or erratic than the prices of other equity
securities, especially over the short term.
Because smaller companies may have limited product lines, markets or financial
resources or may depend on a few key employees, they may be more susceptible to
particular economic events or competitive factors than large capitalization
companies.
Performance
The
following bar chart and table show two aspects of the fund: volatility and
performance. The bar chart
shows the volatility — or variability — of the fund’s annual total
returns over time, and shows that fund performance can change from year to
year. The table shows the fund’s average annual total returns
for certain time periods compared to the returns of a broad-based securities
index. The bar chart and table provide some indication of the risks of investing
in the fund. Of course, the fund’s past
performance is not necessarily an indication of its future
performance. Updated
performance information is available at no cost by visiting www.diamond-hill.com
or by calling 888-226-5595.
CLASS I ANNUAL TOTAL RETURN-YEARS ENDED
12/31
|
|
|
|
| |
Best
Quarter: |
4Q 2020, +13.78% |
Worst
Quarter: |
1Q 2020, -23.39% |
|
| |
20
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2021|
DIAMOND-HILL.COM |
|
|
|
|
| |
Diamond
Hill Long-Short Fund Summary |
As
of February 28, 2023 |
|
| |
AVERAGE
ANNUAL TOTAL RETURNS AS OF
12/31/2022 |
After-tax returns are
calculated using the highest historical individual federal marginal income tax
rate and do not reflect the impact of state and local taxes.
Actual after-tax returns
depend on a shareholder's tax situation and may differ from those shown.
After-tax returns are not relevant for shareholders who hold fund shares in
tax-deferred accounts or to shares held by non-taxable entities.
After-tax returns are shown
for Class I shares only and will vary from the after-tax returns for the other
share classes.
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Inception
Date of Class |
One Year |
Five Year |
Ten Year |
Class I
Before Taxes |
1/31/05 |
(8.45) |
% |
4.52 |
% |
6.68 |
% |
After Taxes on
Distributions |
| (9.63) |
| 3.16 |
| 5.83 |
|
After Taxes on Distributions and Sale
of Fund Shares |
| (4.33) |
| 3.45 |
| 5.34 |
|
Investor
Before Taxes |
6/30/00 |
(8.74) |
| 4.21 |
| 6.38 |
|
Class Y
Before Taxes |
12/30/11 |
(8.36) |
| 4.64 |
| 6.81 |
|
Russell 1000
Index |
| (19.13) |
| 9.13 |
| 12.37 |
|
60% Russell 1000
Index/40% Bloomberg US T-Bills 1-3 Month
Index |
| (10.86) |
| 6.37 |
| 7.87 |
|
The fund's primary
index, the Russell 1000 Index, measures the performance of roughly 1,000 US
large-cap companies. The fund's secondary benchmark represents a 60/40 weighted
blend of the Russell 1000 Index and the Bloomberg US Treasury Bills 1-3 Month
Index. The Bloomberg US Treasury Bills 1-3 Month Index measures the performance
of US Treasury bills with time to maturity between 1 and 3 months. The indexes
are unmanaged, market capitalization weighted, include net reinvested dividends,
do not reflect fees or expenses (which would lower the return), and are not
available for direct investment.
Portfolio
Management
Investment
Adviser
Diamond
Hill Capital Management, Inc.
Portfolio
Managers
Christopher
Bingaman
Portfolio
Manager
since
4/2007
Nathan
Palmer
Portfolio
Manager
since
6/2018
Charles
Bath
Assistant
Portfolio Manager
since
10/2002
Buying
and Selling Fund Shares
Minimum
Initial Investment
Investor
and Class I: $2,500
Class
Y: $500,000
|
|
|
|
| |
To Place Orders |
Mail:
Diamond
Hill Long-Short Fund
P.O.
Box 46707
Cincinnati,
OH 45246
Phone:
888-226-5595 |
Transaction
Policies
In
general, you can buy or sell (redeem) shares of the fund by mail or phone on any
business day. You can generally pay for shares by check or wire. You may be
charged wire fees or other transaction fees; ask your financial professional.
When selling shares, you will receive a check, unless you request a wire. You
may also buy and sell shares through a financial professional.
Dividends,
Capital Gains and Taxes
The
fund’s distributions may be taxable as ordinary income or capital gains, except
when your investment is in an IRA, 401(k) or other tax-advantaged investment
plan. However, you may be subject to tax when you withdraw monies from a
tax-advantaged plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If
you purchase shares (other than Class Y shares) through a broker-dealer or other
financial intermediary (such as a bank), the fund and its related companies may
pay the intermediary for the sale of fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your salesperson to recommend the fund over another
investment. Ask your salesperson or visit your financial intermediary’s web site
for more information.
|
| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 21 |
|
|
|
|
|
|
|
|
|
|
| |
Class |
Investor |
I |
Y |
Ticker |
DHIAX |
DHIIX |
DHIYX |
Investment Objective
The investment objective of
the Diamond Hill International Fund is to provide long-term capital
appreciation.
Fees and Expenses of the Fund
This table describes the fees
and expenses that you may pay if you buy and hold shares of the fund. You may
pay other fees, such as brokerage commissions and other fees to financial
intermediaries, which are not reflected in the tables and examples
below.
|
| |
SHAREHOLDER
FEES (fees
paid directly from your investment) |
|
None |
|
|
|
|
|
|
|
|
|
|
| |
ANNUAL
FUND OPERATING EXPENSES (expenses
that you pay each year as a percentage of the value of your
investment) |
| Investor |
Class I |
Class Y |
Management
fees |
0.65 |
% |
0.65 |
% |
0.65 |
% |
Distribution
(12b-1) fees |
0.25 |
% |
None |
None |
Other
expenses |
0.25 |
% |
0.21 |
% |
0.09 |
% |
Total
annual fund operating expenses |
1.15 |
% |
0.86 |
% |
0.74 |
% |
This Example is
intended to help you compare the cost of investing in the fund with the cost of
investing in other mutual funds. The Example assumes that you invest $10,000 in
the fund for the time periods indicated and then redeem all of your shares at
the end of those periods. The Example also assumes that your investment has a 5%
return each year and that the fund’s operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| 1 Year |
3 Years |
5 Years |
10 Years |
Investor |
$117 |
| $365 |
| $633 |
| $1,398 |
|
Class I |
88 |
| 274 |
| 477 |
| 1,061 |
|
Class Y |
76 |
| 237 |
| 411 |
| 918 |
|
The fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the fund’s performance. During the most recent fiscal
year, the fund’s portfolio turnover rate was 21% of the average value of
its portfolio.
Principal Investment
Strategy
The
fund, under normal market conditions, invests its assets primarily in non-U.S.
equity securities of companies of any size that Diamond Hill Capital Management,
Inc. (the “Adviser”) believes are undervalued. Equity securities consist of
common and preferred stocks. Under normal market conditions, the fund will
invest at least 80% of its net assets in securities issued by companies (i) that
are headquartered or have their principal place of business outside the U.S.,
(ii) whose primary trading markets are outside the U.S. or (iii) that have at
least 50% of their assets in, or expect to derive at least 50% of their total
revenues or profits from, goods or services produced in or sales made in
countries outside the U.S. The fund intends to diversify its investments across
different countries and regions, including emerging markets. Emerging
market countries include those generally recognized to be an emerging market
country by the international financial community; classified by the United
Nations as a developing country; or classified as an emerging market country by
MSCI or other index or data provider.
The
Adviser focuses on estimating a company’s value independent of its current stock
price. To estimate a company’s value, the Adviser concentrates on the
fundamental economic drivers of the business. The primary focus is on
“bottom-up” analysis, which takes into consideration earnings, revenue growth,
operating margins and other economic factors. The Adviser also considers the
level of industry competition, regulatory factors, the threat of technological
obsolescence, and a variety of other industry factors. If the Adviser’s estimate
of a company’s value differs sufficiently from the current market price, the
company may be an attractive investment opportunity. In constructing a portfolio
of securities, the Adviser is not constrained by the sector or industry weights
in the benchmark. The Adviser relies on individual stock selection and
discipline in the investment process to add value. The highest portfolio
security weights are assigned to companies where the Adviser has the highest
level of confidence.
Once
a stock is selected, the Adviser continues to monitor the company’s strategies,
financial performance and competitive environment. The Adviser may sell a
security as it reaches the Adviser’s estimate of the company’s value if it
believes that the company’s earnings, revenue growth, operating margin or other
economic factors are deteriorating, or if it identifies a stock that it believes
offers a better investment opportunity.
Main Risks
All investments carry a certain
amount of risk and the fund cannot guarantee that it will achieve its investment
objective. An investment in the fund is not a
deposit or obligation of any bank, is not endorsed or guaranteed by any bank,
and is not insured by the Federal Deposit Insurance Corporation (FDIC) or any
other government agency. You may lose money by investing in the
fund. Below are the main risks of investing in the fund. All of
the risks listed below are significant to the fund, regardless of the order in
which they appear.
|
| |
22
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
|
|
| |
Diamond
Hill International Fund Summary |
As
of February 28, 2023 |
Management
Risk The
Adviser’s judgments about the attractiveness, value and potential appreciation
of a particular asset class or individual security in which the fund invests may
prove to be incorrect and there is no guarantee that individual companies will
perform as anticipated. The value of an individual company can be more volatile
than the market as a whole, and the Adviser’s intrinsic value-oriented approach
may fail to produce the intended results.
Market
Risk The
value of the fund's investments may decrease, sometimes rapidly or unexpectedly,
due to factors affecting an issuer held by the fund, particular industries or
overall securities markets. When the value of the fund’s investments goes down,
your investment in the fund decreases in value. A variety of factors including
interest rate levels, recessions, inflation, U.S. economic growth, war or acts
of terrorism, natural disasters, political events, supply chain disruptions,
staff shortages and widespread public health issues affect the securities
markets. These events may cause volatility, severe market dislocations and
liquidity constraints in many markets, including markets for the securities the
fund holds, and may adversely affect the fund's investments and operations. In
addition, governmental responses to these events may negatively impact the
capabilities of the fund's service providers, disrupt the fund's operations,
result in substantial market volatility and adversely impact the prices and
liquidity of the fund's investments.
Non-U.S.
and Emerging Markets Risk The
fund may invest in non-U.S. securities and U.S. securities of companies
domiciled in non-U.S. countries that may experience more rapid and extreme
changes in value than a fund that invests exclusively in securities of U.S.
companies. These companies may be subject to additional risks, including
political and economic risks, civil conflicts and war, greater volatility,
expropriation and nationalization risks, currency fluctuations, higher
transaction costs, delayed settlement, possible non-U.S. controls on
investments, and less stringent investor protection and disclosure standards of
non-U.S. markets. Trade tensions and sanctions on individuals and companies can
contribute to market volatility, which may affect the fund's performance. These
risks are magnified in emerging markets as events and evolving conditions in
certain economies or markets may alter the risks associated with investments
tied to countries or regions that historically were perceived as comparatively
stable becoming riskier and more volatile. The market for the securities of
issuers in emerging markets is typically small and low, and nonexistent trading
volumes in those securities may result in a lack of liquidity and price
volatility.
Sector
Emphasis Risk
The
fund, from time to time, may invest 25% or more of its assets in one or more
sectors, subjecting the fund to sector emphasis risk. This is the risk that the
fund is subject to a greater risk of loss as a result of adverse economic,
business or other developments affecting a specific sector in which the fund has
a focused position, than if its investments were diversified across a greater
number of industry sectors. Some sectors possess particular risks that may not
affect other sectors.
Small
Cap and Mid Cap Company Risk Investments
in small cap and mid cap companies may be riskier than investments in larger,
more established companies. The securities of these companies may trade less
frequently and in smaller volumes than securities of larger companies. In
addition, small cap and mid cap companies may be more vulnerable to economic,
market and industry changes. As a result, share price changes may be more sudden
or erratic than the prices of other equity securities, especially over the short
term. Because smaller companies may have limited product lines, markets or
financial
resources or may depend on a few key
employees, they may be more susceptible to particular economic events or
competitive factors than large capitalization
companies.
Performance
The following bar chart and
table show two aspects of the fund: volatility and performance. The bar chart
shows the volatility - or variability - of the fund’s annual total returns over
time, and shows that fund performance can change from year to
year.
Prior
to calendar year 2019, the bar chart and table reflect the past performance of
Diamond Hill International Equity Fund, LP (the “International Partnership”), a
private fund managed with full investment authority by the Adviser, and provide
some indication of the risks of investing in the fund by showing changes in the
fund’s performance from year to year over the periods indicated and by showing
how the fund’s average annual total returns for the periods indicated compared
to a relevant market index. The fund is managed in all material respects in a
manner equivalent to the management of the International Partnership. The fund’s
objectives, policies, guidelines and restrictions are in all material respects
equivalent to the International Partnership, and the fund was created for
reasons entirely unrelated to the establishment of a performance record. The
assets of the International Partnership were converted, based on their value on
June 28, 2019, into assets of the fund prior to commencement of operations of
the fund. The performance of the
International Partnership has been restated to reflect the net expenses and
maximum applicable sales charge of the fund for its initial years of investment
operations. The International Partnership was not registered
under the Investment Company Act of 1940 (the “1940 Act”) and therefore was not
subject to certain investment restrictions imposed by the 1940 Act. If the
International Partnership had been registered under the 1940 Act, its
performance may have been adversely affected. Performance of the fund prior to
calendar year 2019 is measured from December 30, 2016, the inception of the
International Partnership, and is not the performance of the fund.
The fund’s and the International
Partnership’s past performance is not necessarily an indication of how the fund
will perform in the future either before or after
taxes.
Updated performance information is
available at no cost by visiting www.diamond-hill.com
or by calling 888-226-5595.
CLASS I ANNUAL TOTAL RETURN-YEARS ENDED
12/31
|
|
|
|
| |
Best
Quarter: |
4Q 2020, +22.69% |
Worst
Quarter: |
1Q 2020, -26.28% |
|
| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 23 |
|
|
|
|
| |
Diamond
Hill International Fund Summary |
As
of February 28, 2023 |
|
|
|
|
|
|
|
|
|
|
| |
AVERAGE
ANNUAL TOTAL RETURNS AS OF
12/31/2022 |
After-tax returns are
calculated using the highest historical individual federal marginal income tax
rate and do not reflect the impact of state and local taxes.
Actual after-tax returns
depend on a shareholder's tax situation and may differ from those shown.
After-tax returns are not relevant for shareholders who hold fund shares in
tax-deferred accounts or to shares held by non-taxable entities.
After-tax returns are shown
for Class I shares only and will vary from the after-tax returns for the other
share classes. After-tax returns prior to one year are not
provided because the International Partnership’s tax treatment was different
than that of a registered investment company.
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Inception Date of Class |
One Year |
Five
Years |
Since
Inception (12/30/16) |
Class
I
Before Taxes |
06/28/19 |
(13.51) |
% |
2.80 |
% |
7.01 |
% |
After Taxes on
Distributions |
| (13.76) |
| N/A |
N/A |
After Taxes on Distributions
and Sale of Fund Shares |
| (7.68) |
| N/A |
N/A |
Investor
Before Taxes |
06/28/19 |
(13.84) |
| 2.50 |
| 6.69 |
|
Class Y
Before Taxes |
06/28/19 |
(13.41) |
| 2.91 |
| 7.12 |
|
MSCI ACWI ex USA
Index |
|
(16.00) |
| 0.88 |
| 4.85 |
|
Morningstar Global Markets ex-US
Index |
| (16.15) |
| 1.07 |
| 5.04 |
|
Effective June 30, 2022, the fund
changed its primary benchmark to the MSCI ACWI ex USA Index, which is a more
representative and widely recognized benchmark for non-US focused
strategies. The MSCI ACWI ex USA Index measures the performance
of large- and mid-cap stocks in developed (excluding the US) and emerging
markets. The Morningstar Global Markets ex-US Index measures the performance of
the stocks located in the developed and emerging countries (excluding the US) as
defined by Morningstar. The indexes are unmanaged, market capitalization
weighted, include net reinvested dividends, do not reflect fees or expenses
(which would lower return), and are not available for direct
investment.
Portfolio
Management
Investment
Adviser
Diamond
Hill Capital Management, Inc.
Portfolio
Manager
Krishna
Mohanraj
Portfolio
Manager
since
12/2018
Buying
and Selling Fund Shares
Minimum
Initial Investment
Investor
and Class I: $2,500
Class
Y: $500,000
|
|
|
|
| |
To Place Orders |
Mail:
Diamond
Hill International Fund
P.O.
Box 46707
Cincinnati,
OH 45246
Phone:
888-226-5595 |
Transaction
Policies
In
general, you can buy or sell (redeem) shares of the fund by mail or phone on any
business day. You can generally pay for shares by check or wire. You may be
charged wire fees or other transaction fees; ask your financial professional.
When selling shares, you will receive a check, unless you request a wire. You
may also buy and sell shares through a financial professional.
Dividends,
Capital Gains and Taxes
The
fund’s distributions may be taxable as ordinary income or capital gains, except
when your investment is in an IRA, 401(k) or other tax-advantaged investment
plan. However, you may be subject to tax when you withdraw monies from a
tax-advantaged plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If
you purchase shares (other than Class Y shares) through a broker-dealer or other
financial intermediary (such as a bank), the fund and its related companies may
pay the intermediary for the sale of fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your salesperson to recommend the fund over another
investment. Ask your salesperson or visit your financial intermediary’s web site
for more information.
|
| |
24
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
|
|
|
|
|
|
|
|
| |
Class |
Investor |
I |
Y |
Ticker |
DHEAX |
DHEIX |
DHEYX |
Investment Objective
The investment objective of
the Diamond Hill Short Duration Securitized Bond Fund is to maximize total
return consistent with the preservation of capital.
Fees and Expenses of the
Fund
This table describes the fees
and expenses that you may pay if you buy and hold shares of the fund. You may
pay other fees, such as brokerage commissions and other fees to financial
intermediaries, which are not reflected in the tables and examples
below.
|
| |
SHAREHOLDER FEES (fees paid directly from
your investment) |
|
None |
|
|
|
|
|
|
|
|
|
|
| |
ANNUAL FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your
investment) |
| Investor |
Class I |
Class Y |
Management
fees |
0.35 |
% |
0.35 |
% |
0.35 |
% |
Distribution
(12b-1) fees |
0.25 |
% |
None |
None |
Other
expenses |
0.21 |
% |
0.17 |
% |
0.05 |
% |
Total
annual fund operating expenses |
0.81 |
% |
0.52 |
% |
0.40 |
% |
This Example is
intended to help you compare the cost of investing in the fund with the cost of
investing in other mutual funds. The Example assumes that you invest $10,000 in
the fund for the time periods indicated and then redeem all of your shares at
the end of those periods. The Example also assumes that your investment has a 5%
return each year and that the fund’s operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
| 1 Year |
3 Years |
5
Years |
10
Years |
Investor |
| $83 |
| $259 |
| $450 |
| $1,002 |
|
Class I |
| 53 |
| 167 |
| 291 |
| 653 |
|
Class Y |
| 41 |
| 128 |
| 224 |
| 505 |
|
The fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the fund’s performance. During the most recent fiscal
year, the fund’s portfolio turnover rate was 41% of the average value of
its portfolio.
Principal Investment
Strategy
Under
normal market conditions, the fund invests at least 80% of its net assets in
securitized bond investments. Securitized bond investments are also referred to
as “structured product securities” or “structured products.” Securitized bond
investments include secured loans backed by commercial real estate, residential
real estate, commercial or consumer loans, and securitizations such as agency
and non-agency mortgage-backed securities (MBS) (including commercial
mortgage-backed securities (CMBS), residential mortgage-backed securities
(RMBS), and collateralized mortgage obligations (CMOs)), asset-backed securities
(ABS), and other similar securities and related instruments.
Agency
MBS are issued or guaranteed by the US government, its agencies or
instrumentalities, which include mortgage pass-through securities representing
interests in pools of mortgage loans issued or guaranteed by the Government
National Mortgage Association (GNMA or “Ginnie Mae”), the Federal National
Mortgage Association (FNMA or “Fannie Mae”), the Student Loan Marketing
Association (SLMA or “Sallie Mae”) or the Federal Home Loan Mortgage Corporation
(FHLMC or “Freddie Mac”). The fund may also invest in other fixed income
instruments, which include bonds, debt or credit securities and other similar
instruments issued by various US and non-US public or private sector entities at
the discretion of the Diamond Hill Capital Management, Inc. (the “Adviser”).
Under
normal circumstances, the fund will maintain an average portfolio duration of
less than three, although under certain market conditions, such as periods of
significant volatility in interest rates and spreads, the fund’s average
duration may be longer than three. Duration is an approximate measure of a
bond's price sensitivity to changes in interest rates. For instance, a duration
of “three” means that a security’s or portfolio’s price would be expected to
decrease by approximately 3% with a 1% increase in interest rates (assuming a
parallel shift in yield curve). The fund may invest in individual fixed income
securities with effective durations in excess of three, provided, however, such
investments are made within the constraints above.
The
fund may invest up to 15% of its assets in below investment grade securities,
including those referred to as “junk bonds” (or the unrated equivalent) at the
time of purchase.
In
selecting securities for the fund, the Adviser performs a risk/reward analysis
that includes an evaluation of credit risk, interest rate risk, prepayment risk,
and the legal and technical structure of the security. The Adviser will attempt
to take advantage of inefficiencies that it believes exist in the fixed income
markets. The Adviser seeks to invest in securities that the Adviser expects to
offer attractive prospects for income and/or capital appreciation in relation to
the risk borne.
Main Risks
All investments carry a certain
amount of risk and the fund cannot guarantee that it will achieve its investment
objective. An investment in the fund is not
a deposit or obligation of any bank, is not endorsed or guaranteed by any bank,
and is not
|
| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 25 |
|
|
|
|
| |
Diamond
Hill Short Duration Securitized Bond Fund Summary |
As
of February 28, 2023 |
insured by the Federal Deposit Insurance
Corporation (FDIC) or any other government agency.
You may lose money by investing in the
fund. Below are the main risks of investing in the fund. All of
the risks listed below are significant to the fund, regardless of the order in
which they appear.
Asset-Backed,
Mortgage-Related and Mortgage-Backed Securities Risk
The fund may invest in asset-backed, mortgage-related and mortgage-backed
securities, including so-called “sub-prime” mortgages that are subject to
certain other risks including prepayment and call risks. When mortgages and
other obligations are prepaid and when securities are called, the fund may have
to reinvest in securities with a lower yield or fail to recover additional
amounts (i.e., premiums) paid for securities with higher interest rates,
resulting in an unexpected capital loss and/or a decrease in the amount of
dividends and yield. In periods of rising interest rates, the fund may be
subject to extension risk, and may receive principal later than expected. As a
result, in periods of rising interest rates, the fund may exhibit additional
volatility. During periods of difficult or frozen credit markets, significant
changes in interest rates, or deteriorating economic conditions, such securities
may decline in value, face valuation difficulties, become more volatile and/or
become illiquid.
Collateralized
mortgage obligations (“CMOs”) and stripped mortgage-backed securities, including
those structured as interest only (“IOs”) and principal only (“POs”), are more
volatile and may be more sensitive to the rate of prepayments than other
mortgage-related securities. CMOs are issued in multiple classes, and each class
may have its own interest rate and/or final payment date. A class with an
earlier final payment date may have certain preferences in receiving principal
payments or earning interest. As a result, the value of some classes in which
the fund invests may be more volatile and may be subject to higher risk of
non-payment. The risk of default, as described under “Credit Risk”, for
“sub-prime” mortgages is generally higher than other types of mortgage-backed
securities. The structure of some of these securities may be complex and there
may be less available information than other types of debt securities.
The
values of IO and PO mortgage-backed securities are more volatile than other
types of mortgage-related securities. They are very sensitive not only to
changes in interest rates, but also to the rate of prepayments. A rapid or
unexpected increase in prepayments can significantly depress the price of
interest-only securities, while a rapid or unexpected decrease could have the
same effect on principal-only securities. In addition, because there may be a
drop in trading volume, an inability to find a ready buyer, or the imposition of
legal restrictions on the resale of securities, these instruments may be
illiquid. The fund will be exposed to additional risk to the extent that it uses
inverse floaters and inverse IOs, which are debt securities with interest rates
that reset in the opposite direction from the market rate to which the security
is indexed. These securities are more volatile and more sensitive to interest
rate changes than other types of debt securities. If interest rates move in a
manner not anticipated by the Adviser, the fund could lose all or substantially
all of its investment in inverse IOs.
Consumer
Loans Risk
Investments in consumer loans expose the fund to additional risks beyond those
normally associated with more traditional debt instruments. The fund’s ability
to receive payments in connection with the loan depends primarily on the
financial condition of the borrower and whether or not a loan is secured by
collateral, although there is no assurance that the collateral securing a loan
will be sufficient to satisfy the loan obligation. In addition, bank loans often
have contractual restrictions on resale, which can delay the sale and adversely
impact
the sale price. Transactions involving bank loans may have significantly longer
settlement periods than more traditional investments (settlement can take longer
than 7 days) and often involve borrowers whose financial condition is troubled
or highly leveraged, which increases the risk that the fund may not receive its
proceeds in a timely manner or that the fund may incur losses in order to pay
redemption proceeds to its shareholders. In addition, loans are not registered
under the federal securities laws like stocks and bonds, so investors in loans
have less protection against improper practices than investors in registered
securities.
Credit
Risk There
is a risk that issuers and counterparties will not make payments on securities
and repurchase agreements held by a fund. Such default could result in losses to
the fund. In addition, the credit quality of securities held by the fund may be
lowered if an issuer’s financial condition changes. Lower credit quality may
lead to greater volatility in the price of a security and in shares of the fund.
Lower credit quality also may affect liquidity and make it difficult for the
fund to sell the security.
Fixed
Income Risk The
fund invests in fixed income securities. These securities will increase or
decrease in value based on changes in interest rates. If rates increase, the
value of the fund’s fixed income securities generally declines. On the other
hand, if rates fall, the value of the fixed income securities generally
increases. Your investment will decline in value if the value of the fund’s
investments decreases.
Government
Securities Risk The
fund may invest in securities issued or guaranteed by the U.S. government
or its agencies and instrumentalities. These securities may be backed by the
credit of the government as a whole or only by the issuing agency.
U.S. Treasury bonds, notes, and bills and some agency securities, such as
those issued by the Federal Housing Administration and Ginnie Mae, are backed by
the full faith and credit of the U.S. government as to payment of principal
and interest and are the highest quality government securities. Other securities
issued by U.S. government agencies or instrumentalities, such as securities
issued by the Federal Home Loan Banks and Freddie Mac, are supported only by the
credit of the agency that issued them, and not by the U.S. government.
Securities issued by the Federal Farm Credit System, the Federal Land Banks, and
Fannie Mae are supported by the agency’s right to borrow money from the
U.S. Treasury under certain circumstances, but are not backed by the full
faith and credit of the U.S. government. No assurance can be given that the
U.S. government would provide financial support to its agencies and
instrumentalities if not required to do so by law.
High
Yield Securities Risk The
fund will purchase fixed income securities rated below the investment grade
category. Securities in this rating category are speculative. Changes in
economic conditions or other circumstances may have a greater effect on the
ability of issuers of these securities to make principal and interest payments
than they do on issuers of higher grade securities.
Inflation
Risk Because
inflation reduces the purchasing power of income produced by existing fixed
income securities, the prices at which fixed income securities trade will be
reduced to compensate for the fact that the income they produce is worth less.
This potential decrease in market value would be the measure of the inflation
risk incurred by the fund.
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26
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
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Diamond
Hill Short Duration Securitized Bond Fund Summary |
As
of February 28, 2023 |
LIBOR
Transition Risk
Instruments in which the fund invests may pay interest at floating rates based
on the London Interbank Offered Rate (“LIBOR”) or may be subject to interest
caps or floors based on LIBOR. The United Kingdom’s Financial Conduct Authority
and LIBOR's administrator, ICE Benchmark Administration (the "IBA"), have ceased
publishing most LIBOR settings and announced that a majority of U.S. dollar
LIBOR settings will no longer be published after June 30, 2023. Various
financial industry groups have been planning for the transition away from LIBOR,
but there are challenges to converting certain securities and transactions to a
new reference rate (e.g., the Secured Overnight Financing Rate (“SOFR”), which
is intended to replace the U.S. dollar LIBOR). The nature of any replacement
rate and the impact of the transition from LIBOR on the Fund, issuers of
instruments in which the Fund invests, and the financial markets generally are
unknown at this time and may adversely affect a fund’s performance.
Liquidity
Risk
The fund may not be able to purchase or sell a security in a timely manner or at
desired prices or achieve its desired weighting in a security. Liquidity risk
may result from the lack of an active market or a reduced number and capacity of
traditional market participants to make a market in fixed income securities, and
may be magnified during times of market stress. The fund may not be able to meet
the requests to redeem fund shares without significant dilution of remaining
investors' interest in the fund.
Management
Risk The
Adviser’s judgments about the attractiveness, value and potential appreciation
of a particular asset class or individual security in which the fund invests may
prove to be incorrect and there is no guarantee that individual investments will
perform as anticipated.
Market
Risk The
value of the fund's investments may decrease, sometimes rapidly or unexpectedly,
due to factors affecting an issuer held by the fund, particular industries or
overall securities markets. When the value of the fund’s investments goes down,
your investment in the fund decreases in value. A variety of factors including
interest rate levels, recessions, inflation, U.S. economic growth, war or acts
of terrorism, natural disasters, political events, supply chain disruptions,
staff shortages and widespread public health issues affect the securities
markets. These events may cause volatility, severe market dislocations and
liquidity constraints in many markets, including markets for the securities the
fund holds, and may adversely affect the fund's investments and operations. In
addition, governmental responses to these events may negatively impact the
capabilities of the fund's service providers, disrupt the fund's operations,
result in substantial market volatility and adversely impact the prices and
liquidity of the fund's investments.
Non-U.S.
and Emerging Markets Risk
The fund may invest in non-U.S. securities and U.S. securities of companies
domiciled in non-U.S. countries that may experience more rapid and extreme
changes in value than a fund that invests exclusively in securities of U.S.
companies. These companies may be subject to additional risks, including
political and economic risks, civil conflicts and war, greater volatility,
expropriation and nationalization risks, currency fluctuations, higher
transaction costs, delayed settlement, possible non-U.S. controls on
investments, and less stringent investor protection and disclosure standards of
non-U.S. markets. The departure of one or more other countries from the European
Union may have significant political and financial consequences for global
markets. These risks are magnified in emerging markets as events and evolving
conditions in certain economies or markets may alter the risks associated with
investments tied to countries
or regions that historically
were perceived as comparatively stable becoming riskier and more volatile. The
market for the securities of issuers in emerging markets is typically small and
low, and nonexistent trading volumes in those securities may result in a lack of
liquidity and price volatility.
Prepayment and Call
Risk The issuer of certain securities may repay
principal in advance, especially when yields fall. Changes in the rate at which
prepayments occur can affect the return on investment of these securities. When
debt obligations are prepaid or when securities are called, the fund may have to
reinvest in securities with a lower yield. The fund also may fail to recover
additional amounts (i.e., premiums) paid for securities with higher coupons,
resulting in an unexpected capital loss.
Performance
The following bar chart and
table show two aspects of the fund: volatility and performance. The bar chart
shows the volatility — or variability — of the fund’s annual
total returns over time, and shows that fund performance can change from year to
year. The table shows the fund’s average annual total returns
for certain time periods compared to the returns of a broad-based securities
index. The bar chart and table provide some indication of the risks of investing
in the fund. Of course, the fund’s past
performance is not necessarily an indication of its future
performance. Updated performance information is
available at no cost by visiting www.diamond-hill.com
or by calling 888-226-5595.
CLASS I ANNUAL TOTAL RETURN-YEARS ENDED
12/31
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Best
Quarter: |
2Q 2020, +5.26% |
Worst
Quarter: |
1Q 2020, -7.64% |
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DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 27 |
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Diamond
Hill Short Duration Securitized Bond Fund Summary |
As
of February 28, 2023 |
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| |
AVERAGE
ANNUAL TOTAL RETURNS AS OF
12/31/22 |
After-tax returns are
calculated using the highest historical individual federal marginal income tax
rate and do not reflect the impact of state and local taxes.
Actual after-tax returns
depend on a shareholder's tax situation and may differ from those shown.
After-tax returns are not relevant for shareholders who hold fund shares in
tax-deferred accounts or to shares held by non-taxable entities.
After-tax returns are shown
for Class I shares only and will vary from the after-tax returns for the other
share classes.
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| |
| Inception Date of Class |
One Year |
Five
Years |
Since Inception |
Class I
Before Taxes |
07/05/16 |
(3.38) |
% |
2.05 |
% |
2.44 |
% |
After Taxes on
Distributions |
| (4.80) |
| 0.62 |
| 1.03 |
|
After Taxes on Distributions
and Sale of Fund Shares |
| (2.00) |
| 0.97 |
| 1.26 |
|
Investor
Before Taxes |
07/05/16 |
(3.57) |
| 1.77 |
| 2.16 |
|
Class Y
Before Taxes |
07/05/16 |
(3.27) |
| 2.18 |
| 2.56 |
|
Bloomberg US 1-3 Year Government/Credit
Index |
| (3.69) |
| 0.92 |
| 0.77 |
|
The Bloomberg US 1-3
Year Government/Credit Index measures the performance of investment grade
government and corporate bonds with maturities of one to three years. The index
is unmanaged, includes net reinvested dividends, does not reflect fees or
expenses (which would lower the return), and is not available for direct
investment.
Portfolio
Management
Investment
Adviser
Diamond
Hill Capital Management, Inc.
Portfolio
Managers
Henry
Song
Portfolio
Manager
since
7/2016
Mark
Jackson
Portfolio
Manager
since
7/2016
Buying
and Selling Fund Shares
Minimum
Initial Investment
Investor
and Class I: $2,500
Class
Y: $500,000
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| |
To Place Orders |
Mail: Diamond
Hill Short Duration Securitized Bond Fund P.O. Box 46707 Cincinnati,
OH 45246 Phone: 888-226-5595 |
Transaction
Policies
In
general, you can buy or sell (redeem) shares of the fund by mail or phone on any
business day. You can generally pay for shares by check or wire. You may be
charged wire fees or other transaction fees; ask your financial professional.
When selling shares, you will receive a check, unless you request a wire. You
may also buy and sell shares through a financial professional.
Dividends,
Capital Gains and Taxes
The
fund’s distributions may be taxable as ordinary income or capital gains, except
when your investment is in an IRA, 401(k) or other tax-advantaged investment
plan. However, you may be subject to tax when you withdraw monies from a
tax-advantaged plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If
you purchase shares (other than Class Y shares) through a broker-dealer or other
financial intermediary (such as a bank), the fund and its related companies may
pay the intermediary for the sale of fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your salesperson to recommend the fund over another
investment. Ask your salesperson or visit your financial intermediary’s web site
for more information.
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28
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
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| |
Class |
Investor |
I |
Y |
Ticker |
DHRAX |
DHRIX |
DHRYX |
Investment Objective
The investment objective of
the Diamond Hill Core Bond Fund is to maximize total return consistent with the
preservation of capital.
Fees and Expenses of the Fund
This table describes the fees
and expenses that you may pay if you buy and hold shares of the fund. You may
pay other fees, such as brokerage commissions and other fees to financial
intermediaries, which are not reflected in the tables and examples
below.
|
| |
SHAREHOLDER FEES (fees paid directly from
your investment) |
|
None |
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|
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|
|
| |
ANNUAL
FUND OPERATING EXPENSES
(expenses that you pay each year as a percentage of the value of your
investment) |
| Investor |
Class I |
Class Y |
Management
fees |
0.30 |
% |
0.30 |
% |
0.30 |
% |
Distribution
(12b-1) fees |
0.25 |
% |
None |
None |
Other
expenses |
0.21 |
% |
0.17 |
% |
0.05 |
% |
Total
annual fund operating expenses |
0.76 |
% |
0.47 |
% |
0.35 |
% |
This Example is
intended to help you compare the cost of investing in the fund with the cost of
investing in other mutual funds. The Example assumes that you invest $10,000 in
the fund for the time periods indicated and then redeem all of your shares at
the end of those periods. The Example also assumes that your investment has a 5%
return each year and that the fund’s operating expenses remain the same.
Although your actual costs may be higher or lower, based on these assumptions
your costs would be:
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| |
|
| 1 Year |
3 Years |
5
Years |
10
Years |
Investor |
| $78 |
| $243 |
| $422 |
| $942 |
|
Class I |
| 48 |
| 151 |
| 263 |
| 591 |
|
Class Y |
| 36 |
| 113 |
| 197 |
| 443 |
|
The fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the fund’s performance. During the most recent fiscal
year, the fund’s portfolio turnover rate was 40% of the average value of
its portfolio.
Principal Investment
Strategy
Under
normal market conditions, the fund intends to provide total return by investing
at least 80% of its net assets (plus any amounts borrowed for investment
purposes) in a diversified portfolio of investment grade, fixed income
securities, including bonds, debt securities and other similar U.S.
dollar-denominated instruments issued by various U.S. public- or private-sector
entities, by non-U.S. corporations or U.S. affiliates of non-U.S. corporations,
including those in emerging markets. The fund may invest a significant portion
or all of its assets in mortgage-related and mortgage-backed securities at the
discretion of Diamond Hill Capital Management, Inc. (the
“Adviser”).
Under
normal circumstances, the fund will maintain an average portfolio duration of
plus or minus 20% of the duration of the Bloomberg US Aggregate Bond Index. The
Bloomberg US Aggregate Bond Index is a broad-based index that represents the
investment grade, US dollar-denominated fixed-rate taxable bond market.
Duration
of the Bloomberg US Aggregate Bond Index was 6.33 as of its last reconstitution
date of January 31, 2023.
Duration is an approximate measure of a bond’s price sensitivity to changes in
interest rates. For instance, a duration of “three” means that a security’s or
portfolio’s price would be expected to decrease by approximately 3% with a 1%
increase in interest rates (assuming a parallel shift in yield
curve).
In selecting securities for the fund, the
Adviser performs a risk/reward analysis that includes an evaluation of credit
risk, interest rate risk, prepayment risk, and the legal and technical structure
of the security. The Adviser will attempt to take advantage of inefficiencies
that it believes exist in the fixed-income markets. The Adviser seeks to invest
in securities that the Adviser expects to offer attractive prospects for current
income and/or capital appreciation in relation to the risk
borne.
Main Risks
All
investments carry a certain amount of risk and the fund cannot guarantee that it
will achieve its investment objective. An investment in the fund is not a
deposit or obligation of any bank, is not endorsed or guaranteed by any bank,
and is not insured by the Federal Deposit Insurance Corporation (FDIC) or any
other government agency. You may lose money by investing in the
fund. Below are the main risks of investing in the fund. All of
the risks listed below are significant to the fund, regardless of the order in
which they appear.
Asset-Backed,
Mortgage-Related and Mortgage-Backed Securities Risk The
fund may invest in asset-backed, mortgage-related and mortgage-backed
securities, including so-called “sub-prime” mortgages that are subject to
certain other risks including prepayment and call risks. When mortgages and
other obligations are prepaid and when securities are called, the fund may have
to reinvest in securities with a lower yield or fail to recover additional
amounts (i.e., premiums) paid for securities with higher interest rates,
resulting in an unexpected capital loss and/or a decrease in the amount of
dividends and yield. In periods of rising interest rates, the fund may be
subject to extension risk, and may receive principal later than expected. As a
result, in periods of rising interest rates, the fund may exhibit additional
volatility. During periods of difficult or frozen credit
|
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DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 29 |
|
|
|
|
| |
Diamond
Hill Core Bond Fund Summary |
As
of February 28, 2023 |
markets,
significant changes in interest rates, or deteriorating economic conditions,
such securities may decline in value, face valuation difficulties, become more
volatile and/or become illiquid.
Collateralized
mortgage obligations (“CMOs”) and stripped mortgage-backed securities, including
those structured as interest only (“IOs”) and principal only (“POs”), are more
volatile and may be more sensitive to the rate of prepayments than other
mortgage-related securities. CMOs are issued in multiple classes, and each class
may have its own interest rate and/or final payment date. A class with an
earlier final payment date may have certain preferences in receiving principal
payments or earning interest. As a result, the value of some classes in which
the fund invests may be more volatile and may be subject to higher risk of
non-payment. The risk of default, as described under “Credit Risk”, for
“sub-prime” mortgages is generally higher than other types of mortgage-backed
securities. The structure of some of these securities may be complex and there
may be less available information than other types of debt securities.
The
values of IO and PO mortgage-backed securities are more volatile than other
types of mortgage-related securities. They are very sensitive not only to
changes in interest rates, but also to the rate of prepayments. A rapid or
unexpected increase in prepayments can significantly depress the price of
interest-only securities, while a rapid or unexpected decrease could have the
same effect on principal-only securities. In addition, because there may be a
drop in trading volume, an inability to find a ready buyer, or the imposition of
legal restrictions on the resale of securities, these instruments may be
illiquid. The fund will be exposed to additional risk to the extent that it uses
inverse floaters and inverse IOs, which are debt securities with interest rates
that reset in the opposite direction from the market rate to which the security
is indexed. These securities are more volatile and more sensitive to interest
rate changes than other types of debt securities. If interest rates move in a
manner not anticipated by the Adviser, the fund could lose all or substantially
all of its investment in inverse IOs.
Consumer
Loans Risk
Investments
in consumer loans expose the fund to additional risks beyond those normally
associated with more traditional debt instruments. The fund’s ability to receive
payments in connection with the loan depends primarily on the financial
condition of the borrower and whether or not a loan is secured by collateral,
although there is no assurance that the collateral securing a loan will be
sufficient to satisfy the loan obligation. In addition, bank loans often have
contractual restrictions on resale, which can delay the sale and adversely
impact the sale price. Transactions involving bank loans may have significantly
longer settlement periods than more traditional investments (settlement can take
longer than 7 days) and often involve borrowers whose financial condition is
troubled or highly leveraged, which increases the risk that the fund may not
receive its proceeds in a timely manner or that the fund may incur losses in
order to pay redemption proceeds to its shareholders. In addition, loans are not
registered under the federal securities laws like stocks and bonds, so investors
in loans have less protection against improper practices than investors in
registered securities.
Credit
Risk There
is a risk that issuers and counterparties will not make payments on securities
and repurchase agreements held by a fund. Such default could result in losses to
the fund. In addition, the credit quality of securities held by the fund may be
lowered if an issuer’s financial condition changes. Lower credit quality may
lead to greater volatility in the price of a security and
in
shares of the fund. Lower credit quality also may affect liquidity and make it
difficult for the fund to sell the security.
Fixed
Income Risk
The fund invests in fixed income securities. These securities will increase or
decrease in value based on changes in interest rates. If rates increase, the
value of the fund’s fixed income securities generally declines. On the other
hand, if rates fall, the value of the fixed income securities generally
increases. Your investment will decline in value if the value of the fund’s
investments decreases.
Government
Securities Risk The
fund may invest in securities issued or guaranteed by the U.S. government
or its agencies and instrumentalities. These securities may be backed by the
credit of the government as a whole or only by the issuing agency.
U.S. Treasury bonds, notes, and bills and some agency securities, such as
those issued by the Federal Housing Administration and Ginnie Mae, are backed by
the full faith and credit of the U.S. government as to payment of principal
and interest and are the highest quality government securities. Other securities
issued by U.S. government agencies or instrumentalities, such as securities
issued by the Federal Home Loan Banks and Freddie Mac, are supported only by the
credit of the agency that issued them, and not by the U.S. government.
Securities issued by the Federal Farm Credit System, the Federal Land Banks, and
Fannie Mae are supported by the agency’s right to borrow money from the
U.S. Treasury under certain circumstances, but are not backed by the full
faith and credit of the U.S. government. No assurance can be given that the
U.S. government would provide financial support to its agencies and
instrumentalities if not required to do so by law.
Inflation
Risk Because
inflation reduces the purchasing power of income produced by existing fixed
income securities, the prices at which fixed income securities trade will be
reduced to compensate for the fact that the income they produce is worth less.
This potential decrease in market value would be the measure of the inflation
risk incurred by the fund.
LIBOR
Transition Risk
Instruments in which the fund invests may pay interest at floating rates based
on the London Interbank Offered Rate (“LIBOR”) or may be subject to interest
caps or floors based on LIBOR. The United Kingdom’s Financial Conduct Authority
and LIBOR's administrator, ICE Benchmark Administration (the "IBA"), have ceased
publishing most LIBOR settings and announced that a majority of U.S. dollar
LIBOR settings will no longer be published after June 30, 2023. Various
financial industry groups have been planning for the transition away from LIBOR,
but there are challenges to converting certain securities and transactions to a
new reference rate (e.g., the Secured Overnight Financing Rate (“SOFR”), which
is intended to replace the U.S. dollar LIBOR). The nature of any replacement
rate and the impact of the transition from LIBOR on the Fund, issuers of
instruments in which the Fund invests, and the financial markets generally are
unknown at this time and may adversely affect a fund’s performance.
Liquidity
Risk
The fund may not be able to purchase or sell a security in a timely manner or at
desired prices or achieve its desired weighting in a security. Liquidity risk
may result from the lack of an active market or a reduced number and capacity of
traditional market participants to make a market in fixed income securities, and
may be magnified during times of market stress. The fund may not be able to meet
the requests to redeem fund shares without significant dilution of remaining
investors' interest in the fund.
|
| |
30
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
|
|
|
|
| |
Diamond
Hill Core Bond Fund Summary |
As
of February 28, 2023 |
Management
Risk The
Adviser’s judgments about the attractiveness, value and potential appreciation
of a particular asset class or individual security in which the fund invests may
prove to be incorrect and there is no guarantee that individual investments will
perform as anticipated.
Market
Risk
The
value of the fund's investments may decrease, sometimes rapidly or unexpectedly,
due to factors affecting an issuer held by the fund, particular industries or
overall securities markets. When the value of the fund’s investments goes down,
your investment in the fund decreases in value. A variety of factors including
interest rate levels, recessions, inflation, U.S. economic growth, war or acts
of terrorism, natural disasters, political events, supply chain disruptions,
staff shortages and widespread public health issues affect the securities
markets. These events may cause volatility, severe market dislocations and
liquidity constraints in many markets, including markets for the securities the
fund holds, and may adversely affect the fund's investments and operations. In
addition, governmental responses to these events may negatively impact the
capabilities of the fund's service providers, disrupt the fund's operations,
result in substantial market volatility and adversely impact the prices and
liquidity of the fund's investments.
Non-U.S.
and Emerging Markets Risk The
fund may invest in non-U.S. securities and U.S. securities of companies
domiciled in non-U.S. countries that may experience more rapid and extreme
changes in value than a fund that invests exclusively in securities of U.S.
companies. These companies may be subject to additional risks, including
political and economic risks, civil conflicts and war, greater volatility,
expropriation and nationalization risks, currency fluctuations, higher
transaction costs, delayed settlement, possible non-U.S. controls on
investments, and less stringent investor protection and disclosure standards of
non-U.S. markets. The departure of one or more other countries from the European
Union may have significant political and financial consequences for global
markets. These risks are magnified in emerging markets as events and evolving
conditions in certain economies or markets may alter the risks associated with
investments tied to countries or regions that historically were perceived as
comparatively stable becoming riskier and more volatile. The market for the
securities of issuers in emerging markets is typically small and low, and
nonexistent trading volumes in those securities may result in a lack of
liquidity and price volatility.
Prepayment
and Call Risk The
issuer of certain securities may repay principal in advance, especially when
yields fall. Changes in the rate at which prepayments occur can affect the
return on investment of these securities. When debt obligations are prepaid or
when securities are called, the fund may have to reinvest in securities with a
lower yield. The fund also may fail to recover additional amounts (i.e.,
premiums) paid for securities with higher coupons, resulting in an unexpected
capital loss.
Performance
The following bar chart and
table show two aspects of the fund: volatility and performance. The bar chart
shows the volatility — or variability — of the fund’s annual
total returns over time, and shows that fund performance can change from year to
year. The table shows the fund’s average annual total returns
for certain time periods compared to the returns of a broad-based securities
index. The bar chart and table provide some indication of the risks of investing
in the fund. Of course, the fund’s past
performance is not necessarily an indication of its future
performance. Updated performance information is
available at no cost by visiting www.diamond-hill.com
or by calling 888-226-5595.
CLASS I ANNUAL TOTAL RETURN-YEARS ENDED
12/31
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Best
Quarter: |
2Q 2020, +4.10% |
Worst
Quarter: |
1Q 2022, -4.99% |
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AVERAGE
ANNUAL TOTAL RETURNS AS OF
12/31/22 |
After-tax returns are
calculated using the highest historical individual federal marginal income tax
rate and do not reflect the impact of state and local taxes.
Actual after-tax returns
depend on a shareholder's tax situation and may differ from those shown.
After-tax returns are not relevant for shareholders who hold fund shares in
tax-deferred accounts or to shares held by non-taxable entities.
After-tax returns are shown
for Class I shares only and will vary from the after-tax returns for the other
share classes.
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|
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| Inception Date of Class |
One Year |
Five
Years |
Since Inception |
Class I
Before Taxes |
07/05/16 |
(11.84) |
% |
0.65 |
% |
0.80 |
% |
After Taxes on
Distributions |
| (12.87) |
| (0.44) |
| (0.27) |
|
After Taxes on Distributions
and Sale of Fund Shares |
| (6.99) |
| 0.07 |
| 0.17 |
|
Investor
Before
Taxes |
07/05/16 |
(12.05) |
| 0.37 |
| 0.52 |
|
Class Y
Before Taxes |
07/05/16 |
(11.63) |
| 0.79 |
| 0.92 |
|
Bloomberg US Aggregate Bond
Index |
| (13.01) |
| 0.02 |
| 0.05 |
|
The Bloomberg US
Aggregate Bond Index measures the performance of investment grade, fixed-rate
taxable bond market and includes government and corporate bonds, agency
mortgage-backed, asset-backed and commercial mortgage-backed securities (agency
and non-agency). The index is unmanaged, includes net reinvested dividends, does
not reflect fees or expenses (which would lower the return), and is not
available for direct investment.
Portfolio
Management
Investment
Adviser
Diamond
Hill Capital Management, Inc.
Portfolio
Managers
Henry
Song
Portfolio
Manager
since
7/2016
Mark
Jackson
Portfolio
Manager
since
7/2016
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DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 31 |
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Diamond
Hill Core Bond Fund Summary |
As
of February 28, 2023 |
Buying
and Selling Fund Shares
Minimum
Initial Investment
Investor
and Class I: $2,500
Class
Y: $500,000
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To Place Orders |
Mail:
Diamond
Hill Core Bond Fund
P.O.
Box 46707
Cincinnati,
OH 45246
Phone:
888-226-5595 |
Transaction
Policies
In
general, you can buy or sell (redeem) shares of the fund by mail or phone on any
business day. You can generally pay for shares by check or wire. You may be
charged wire fees or other transaction fees; ask your financial professional.
When selling shares, you will receive a check, unless you request a wire. You
may also buy and sell shares through a financial professional.
Dividends,
Capital Gains and Taxes
The
fund’s distributions may be taxable as ordinary income or capital gains, except
when your investment is in an IRA, 401(k) or other tax-advantaged investment
plan. However, you may be subject to tax when you withdraw monies from a
tax-advantaged plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If
you purchase shares (other than Class Y shares) through a broker-dealer or other
financial intermediary (such as a bank), the fund and its related companies may
pay the intermediary for the sale of fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
other intermediary and your salesperson to recommend the fund over another
investment. Ask your salesperson or visit your financial intermediary’s web site
for more information.
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32
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
Additional
Information About Investment Strategies and Related Risks
Securities
Lending
To
generate additional income, each fund may lend its portfolio securities to
financial institutions, meaning that a significant portion of the fund could be
on loan at any given time. Cash collateral from borrowers is invested in a
registered investment company managed by State Street Global Advisors (the
"State Street Fund") that was established solely to hold securities lending
collateral. The funds are the only investors in the State Street Fund and own
all its shares. While this practice will not impact a fund’s principal
investment strategy, it does subject the fund to the securities lending risk
described in the Investment Risks section below. Any expenses associated with
securities lending are not reflected in the fee table for the fund.
Investments
in Other Diamond Hill Funds
Each
fund may invest in shares of another investment company, including another
Diamond Hill Fund. While this practice will not impact a fund’s principal
investment strategy, it does subject the fund to the investment company risk
described in the Investment Risks section below. To the extent a fund invests in
an underlying Diamond Hill Fund, the Adviser has contractually agreed to
permanently waive a portion of the fund’s management fee in the pro rata amount
of the management fee charged by the underlying Diamond Hill Funds. This
agreement can only be terminated by the Funds’ Board of Trustees. “Acquired Fund
Fees and Expenses” and the amount of the contractual waiver, as shown on the
expense table in the Fund Summary for each fund, will vary with changes in the
expenses of the underlying Diamond Hill Fund, as well as the allocation of the
fund’s assets.
Equity
Securities
Except
for the Short Duration Securitized Bond Fund and Core Bond Fund, each fund will
invest primarily in equity securities. Although not a principal strategy, a
fund’s investment in equity securities may also include common and preferred
stock, rights and warrants, S&P Depositary Receipts (“SPDRs”) and American
Depositary Receipts (“ADRs”).
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DIAMOND
HILL SMALL CAP FUND |
The
fund, under normal market conditions, invests at least 80% of its net assets in
U.S. equity securities with small market capitalizations that the Adviser
believes are undervalued. This is a non-fundamental investment policy that can
be changed by the fund’s Board of Trustees upon 60 days’ prior notice
to shareholders.
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DIAMOND
HILL SMALL-MID CAP FUND |
The
fund, under normal market conditions, invests at least 80% of its net assets in
U.S. equity securities with small and medium market capitalizations that
the Adviser believes are undervalued. This is a non-fundamental investment
policy that can be changed by the fund’s Board of Trustees upon 60 days’
prior notice to shareholders.
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DIAMOND
HILL MID CAP FUND |
The
fund, under normal market conditions, invests at least 80% of its net assets in
U.S. equity securities with medium market capitalizations that the Adviser
believes are undervalued. This is a non-fundamental investment policy that can
be changed by the fund’s Board of Trustees upon 60 days’ prior notice to
shareholders.
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DIAMOND
HILL LARGE CAP FUND |
The
fund, under normal market conditions, invests at least 80% of its net assets in
U.S. equity securities with large market capitalizations that the Adviser
believes are undervalued. This is a non-fundamental investment policy that can
be changed by the fund’s Board of Trustees upon 60 days’ prior notice
to shareholders.
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DIAMOND
HILL LARGE CAP CONCENTRATED FUND |
The
fund, under normal market conditions, invests at least 80% of its net assets in
U.S. equity securities with large market capitalizations that the Adviser
believes are undervalued. The fund is non-diversified and intends to concentrate
its investments in approximately 20 securities. This is a non-fundamental
investment policy that can be changed by the fund’s Board of Trustees upon
60 days’ prior notice to shareholders.
The
fund, under normal market conditions, invests its assets U.S. equity securities
of any size capitalization that the Adviser believes are undervalued. The fund
is non-diversified and intends to concentrate its investments in 30 to 40 select
securities. Effective
April 30, 2023 the fund intends to concentrate its investments in a limited
number of securities. This
is a non-fundamental investment policy that can be changed by the fund’s Board
of Trustees upon 60 days’ prior notice to shareholders.
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DIAMOND
HILL LONG-SHORT FUND |
The
fund, under normal market conditions, invests its assets in U.S. equity
securities of any size capitalization that the Adviser believes are undervalued
and selling short equity securities of any size capitalization the Adviser
believes are overvalued. This is a non-fundamental investment policy that can be
changed by the fund’s Board of Trustees upon 60 days’ prior notice to
shareholders.
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DIAMOND
HILL INTERNATIONAL FUND |
The
fund, under normal market conditions, invests its assets primarily in non-U.S.
equity securities of companies of any size that the Adviser believes are
undervalued. This
is a non-fundamental investment policy that can be changed by the fund’s Board
of Trustees upon 60 days’ prior notice to shareholders.
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DIAMOND
HILL SHORT DURATION SECURITIZED BOND
FUND |
Under
normal market conditions, the fund invests at least 80% of its net assets in
securitized bond investments. Securitized bond investments are also referred to
as “structured product securities” or “structured products.” Securitized bond
investments include secured loans backed by commercial real estate, residential
real estate, commercial or consumer loans, and securitizations such as agency
and non-agency mortgage-backed securities (MBS) (including commercial
mortgage-backed securities (CMBS), residential mortgage-backed securities
(RMBS), and collateralized mortgage obligations (CMOs)), asset-backed securities
(ABS), and other similar securities and related
instruments.
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DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 33 |
Agency
MBS are issued or guaranteed by the US government, its agencies or
instrumentalities, which include mortgage pass-through securities representing
interests in pools of mortgage loans issued or guaranteed by the Government
National Mortgage Association (GNMA or “Ginnie Mae”), the Federal National
Mortgage Association (FNMA or “Fannie Mae”), the Student Loan Marketing
Association (SLMA or “Sallie Mae”) or the Federal Home Loan Mortgage Corporation
(FHLMC or “Freddie Mac”). The fund may also invest in other fixed income
instruments, which include bonds, debt or credit securities and other similar
instruments issued by various US and non-US public or private sector entities at
the discretion of the Adviser.
Under
normal circumstances, the fund will maintain an average portfolio duration of
less than three, although under certain market conditions, such as periods of
significant volatility in interest rates and spreads, the fund’s average
duration may be longer than three. Duration is an approximate measure of a
bond's price sensitivity to changes in interest rates. For instance, a duration
of “three” means that a security’s or portfolio’s price would be expected to
decrease by approximately 3% with a 1% increase in interest rates (assuming a
parallel shift in yield curve). The fund may invest in individual fixed income
securities with effective durations in excess of three, provided, however, such
investments are made within the constraints above.
The
fund may invest up to 15% of its assets in below investment grade securities,
including those referred to as “junk bonds” (or the unrated equivalent) at the
time of purchase.
This
is a non-fundamental investment policy that can be changed by the fund’s Board
of Trustees upon 60 days’ prior notice to shareholders.
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DIAMOND
HILL CORE BOND FUND |
Under
normal market conditions, the fund intends to provide total return by investing
at least 80% of its net assets (plus any amounts borrowed for investment
purposes) in a diversified portfolio of investment grade, fixed income
securities, including bonds, debt securities and other similar U.S.
dollar-denominated instruments issued by various U.S. public- or private-sector
entities, by non-U.S. corporations or a U.S. affiliates of non-U.S.
corporations, including those in emerging markets. This is a non-fundamental
investment policy that can be changed by the fund’s Board of Trustees upon 60
days’ prior notice to shareholders.
Emerging
market countries include those generally recognized to be an emerging market
country by the international financial community; classified by the United
Nations as a developing country; or classified as an emerging market country by
Morningstar, Inc., or other index or data provider. The fund may invest a
significant portion or all of its assets in mortgage-related and mortgage-backed
securities at the Adviser’s discretion. Mortgage- backed securities include
CMOs, IOs and POs. CMOs are a type of mortgage-backed security that contains a
pool of mortgages bundled together and sold as an investment. Organized by
maturity and level of risk, CMOs receive cash flows as borrowers repay the
mortgages that act as collateral on these securities. CMOs distribute
principal and interest payments to their investors based on predetermined rules
and agreements. POs and IOs are mortgage-backed securities that receive only
principal or interest payments, respectively, generated by the underlying
collateral. Consequently, an investor in an IO is entitled to receive only
regular cash flows that are derived from incoming interest payments received by
the CMO, while the investor in a PO is entitled to receive
only
regular cash flows that are derived from incoming principal repayments on the
loan pool underlying the CMO. Under normal circumstances, the fund will maintain
an average portfolio duration plus or minus 20% of the duration of the Bloomberg
US Aggregate Bond Index. The Bloomberg US Aggregate Bond Index is a broad-based
index that represents the investment grade, US dollar-denominated fixed-rate
taxable bond market. Duration is an approximate measure of a bond's price
sensitivity to changes in interest rates. For instance, a duration of “three”
means that a security’s or portfolio’s price would be expected to decrease by
approximately 3% with a 1% increase in interest rates (assuming a parallel shift
in yield curve).
Investment
Risks
The
main risks associated with investing in the funds are described below and in the
Fund Summaries at the front of this prospectus. All of the risks listed
below are significant to the funds, regardless of the order in which they
appear.
Main
Risks
Asset-Backed,
Mortgage-Related and Mortgage-Backed Securities Risk
(applicable to Short Duration Securitized Bond Fund and Core Bond Fund) The
funds may invest in asset-backed, mortgage-related and mortgage-backed
securities, including so-called “sub-prime” mortgages that are subject to
certain other risks including prepayment and call risks. When mortgages and
other obligations are prepaid and when securities are called, the funds may have
to reinvest in securities with a lower yield or fail to recover additional
amounts (i.e., premiums) paid for securities with higher interest rates,
resulting in an unexpected capital loss and/or a decrease in the amount of
dividends and yield. In periods of rising interest rates, the funds may be
subject to extension risk, and may receive principal later than expected. As a
result, in periods of rising interest rates, the funds may exhibit additional
volatility. During periods of difficult or frozen credit markets, significant
changes in interest rates, or deteriorating economic conditions, such securities
may decline in value, face valuation difficulties, become more volatile and/or
become illiquid.
CMOs
and stripped mortgage-backed securities, including those structured as IOs and
POs, are more volatile and may be more sensitive to the rate of prepayments than
other mortgage-related securities. CMOs are issued in multiple classes, and each
class may have its own interest rate and/or final payment date. A class with an
earlier final payment date may have certain preferences in receiving principal
payments or earning interest. As a result, the value of some classes in which
the funds invest may be more volatile and may be subject to higher risk of
non-payment. The risk of default, as described under “Credit Risk”, for
“sub-prime” mortgages is generally higher than other types of mortgage-backed
securities. The structure of some of these securities may be complex and there
may be less available information than other types of debt securities.
The
values of IO and PO mortgage-backed securities are more volatile than other
types of mortgage-related securities. They are very sensitive not only to
changes in interest rates, but also to the rate of prepayments. A rapid or
unexpected increase in prepayments can significantly depress the price of
interest-only securities, while a rapid or unexpected decrease could have the
same effect on principal-only securities. In addition, because there may be a
drop in trading volume, an inability to find a ready buyer, or the imposition of
legal restrictions on the resale of securities, these instruments may be
illiquid. The funds will be exposed to additional risk to the extent that they
use inverse floaters and inverse IOs, which are debt securities with interest
rates that reset in the opposite direction from the market rate to
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34
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
which
the security is indexed. These securities are more volatile and more sensitive
to interest rate changes than other types of debt securities. If interest rates
move in a manner not anticipated by the Adviser, the funds could lose all or
substantially all of their investments in inverse IOs.
Consumer
Loans Risk
(applicable
to Short Duration Securitized Bond Fund and Core Bond Fund) Investments in
consumer loans expose the funds to additional risks beyond those normally
associated with more traditional debt instruments. A fund’s ability to receive
payments in connection with the loan depends primarily on the financial
condition of the borrower and whether or not a loan is secured by collateral,
although there is no assurance that the collateral securing a loan will be
sufficient to satisfy the loan obligation. In addition, bank loans often have
contractual restrictions on resale, which can delay the sale and adversely
impact the sale price. Transactions involving bank loans may have significantly
longer settlement periods than more traditional investments (settlement can take
longer than 7 days) and often involve borrowers whose financial condition is
troubled or highly leveraged, which increases the risk that a fund may not
receive its proceeds in a timely manner or that a fund may incur losses in order
to pay redemption proceeds to its shareholders. In addition, loans are not
registered under the federal securities laws like stocks and bonds, so investors
in loans have less protection against improper practices than investors in
registered securities.
Credit
Risk
(applicable to Short Duration Securitized Bond Fund and Core Bond Fund) There is
a risk that issuers and counterparties will not make payments on securities and
repurchase agreements held by the funds. Such default could result in losses to
the funds. In addition, the credit quality of securities held by the funds may
be lowered if an issuer’s financial condition changes. Lower credit quality may
lead to greater volatility in the price of a security and in shares of the
funds. Lower credit quality also may affect liquidity and make it difficult for
the funds to sell the security.
Fixed
Income Risk (applicable
to Short Duration Securitized Bond Fund and Core Bond Fund) The funds invest in
fixed income securities. These securities will increase or decrease in value
based on changes in interest rates. If rates increase, the value of a fund’s
fixed income securities generally declines. On the other hand, if rates fall,
the value of the fixed income securities generally increases. Your investment
will decline in value if the value of a fund’s investments decreases. The funds
may invest in variable and floating rate securities. Although these instruments
are generally less sensitive to interest rate changes than fixed rate
instruments, the value of variable and floating rate securities may decline if
their interest rates do not rise as quickly, or as much, as general interest
rates. Fixed income securities with greater interest rate sensitivity and longer
maturities tend to produce higher yields, but are subject to greater
fluctuations in value. Usually, changes in the value of fixed income securities
will not affect cash income generated, but will affect the value of your
investment.
Focused
Portfolio Risk
(applicable to Large Cap Concentrated Fund and Select Fund) The funds may have
more volatility and are considered to have more risk than funds that invest in
securities of a greater number of issuers because changes in the value of a
single issuer's security may have a more significant effect, either positive or
negative, on each fund's net asset value.
Government
Securities Risk (applicable
to Short Duration Securitized Bond Fund and Core Bond Fund) The funds may invest
in securities issued or guaranteed by the U.S. government or its agencies
and instrumentalities. These securities may be backed by the credit of the
government as a
whole
or only by the issuing agency. U.S. Treasury bonds, notes, and bills and
some agency securities, such as those issued by the Federal Housing
Administration and Ginnie Mae, are backed by the full faith and credit of the
U.S. government as to payment of principal and interest and are the highest
quality government securities. Other securities issued by U.S. government
agencies or instrumentalities, such as securities issued by the Federal Home
Loan Banks and Freddie Mac, are supported only by the credit of the agency that
issued them, and not by the U.S. government. Securities issued by the
Federal Farm Credit System, the Federal Land Banks, and Fannie Mae are supported
by the agency’s right to borrow money from the U.S. Treasury under certain
circumstances, but are not backed by the full faith and credit of the
U.S. government. No assurance can be given that the U.S. government
would provide financial support to its agencies and instrumentalities if not
required to do so by law. However, in 2008, the U.S. Treasury Department
and the Federal Housing Finance Authority (the “FHFA”) placed Fannie Mae and
Freddie Mac into conservatorship to stabilize the institutions and return them
to normal business operations. The U.S. Treasury Department and the FHFA at
the same time established a secured lending facility and a Preferred Stock
Purchase Agreement with both Fannie Mae and Freddie Mac to ensure that each
entity had the ability to fulfill its financial obligations. Neither the
U.S. government nor its agencies guarantee the market value of their
securities, and interest rate changes, prepayments and other factors may affect
the value of government securities.
High
Yield Securities Risk (applicable
to Short Duration Securitized Bond Fund and Core Bond Fund) This is a main risk
for the Short Duration Securitized Bond Fund, and an additional risk for the
Core Bond Fund as it relates to a non-principal investment strategy. The funds
invest in below investment grade bonds, also known as high yield securities or
junk bonds. High yield securities provide greater income and opportunity for
gain, but entail greater risk of loss of principal. High yield securities are
predominantly speculative with respect to the issuer’s capacity to pay interest
and repay principal in accordance with the terms of the obligation. These
investments may be issued by companies which are highly leveraged, less
creditworthy or financially distressed. Although these investments generally
provide a higher yield than higher-rated debt securities, the high degree of
risk involved in these investments can result in substantial or total losses.
The market for high yield securities is generally less active than the market
for higher quality securities and the market price of these securities can
change suddenly and unexpectedly. Based on measures such as dealer inventories
and average trade size, the high yield market has become less liquid at the same
time as it has grown markedly and become more concentrated under the control of
the largest investors. During future periods of market stress, liquidity
conditions in the high yield market may be even worse than prior periods of
market stress.
Inflation
Risk (applicable
to Short Duration Securitized Bond Fund and Core Bond Fund) Because inflation
reduces the purchasing power of income produced by existing fixed income
securities, the prices at which fixed income securities trade will be reduced to
compensate for the fact that the income they produce is worth less. This
potential decrease in market value would be the measure of the inflation risk
incurred by the funds.
LIBOR
Transition Risk
Instruments in which the fund invests may pay interest at floating rates based
on the London Interbank Offered Rate (“LIBOR”) or may be subject to interest
caps or floors based on LIBOR. The United Kingdom’s Financial Conduct Authority
and LIBOR's administrator, ICE Benchmark Administration (the "IBA"), have ceased
publishing most LIBOR
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DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 35 |
settings
and announced that a majority of U.S. dollar LIBOR settings will no longer be
published after June 30, 2023. Various financial industry groups have been
planning for the transition away from LIBOR, but there are challenges to
converting certain securities and transactions to a new reference rate (e.g.,
the Secured Overnight Financing Rate (“SOFR”), which is intended to replace the
U.S. dollar LIBOR). The nature of any replacement rate and the impact of the
transition from LIBOR on the Fund, issuers of instruments in which the Fund
invests, and the financial markets generally are unknown at this time and may
adversely affect a fund’s performance.
Liquidity
Risk
(applicable to the Short Duration Securitized Bond Fund and Core Bond Fund) The
funds may not be able to purchase or sell a security in a timely manner or at
desired prices or achieve its desired weighting in a security. Liquidity risk
may result from the lack of an active market or a reduced number and capacity of
traditional market participants to make a market in fixed income securities, and
may be magnified during times of market stress. The funds may not be able to
meet the requests to redeem fund shares without significant dilution of
remaining investors' interest in the fund.
Market
Risk The
value of the fund's investments may decrease, sometimes rapidly or unexpectedly,
due to factors affecting an issuer held by the fund, particular industries or
overall securities markets. When the value of a fund’s investments goes down,
your investment in the fund decreases in value. A variety of factors including
interest rate levels, recessions, inflation, U.S. economic growth, war or acts
of terrorism, natural disasters, political events, supply chain disruptions,
staff shortages and widespread public health issues affect the securities
markets. The global spread of novel coronavirus disease (COVID-19) was declared
a pandemic by the World Health Organization. This pandemic has resulted in
significant disruptions to economies and markets, adversely impacting individual
companies, sectors, industries, currencies, interest and inflation rates, credit
ratings and investor sentiment. COVID-19 has caused volatility, severe market
dislocations and liquidity constraints in many markets, including markets for
the securities the fund holds, and may adversely affect the fund's investments
and operations. The duration and extent of COVID-19 over the long-term cannot be
reasonable estimated at this time. There have been no comparable recent events
that provide guidance as to the effect the spread of COVID-19 as a global
pandemic may have on the funds' financial performance. In addition, public
health issues, such as COVID-19 AND governmental responses to them may
negatively impact the capabilities of the fund's service providers and disrupt
the funds' operations. Pandemics may result in substantial market volatility and
adversely impact the prices and liquidity of the funds' investments. Management
continues to monitor and evaluate this situation.
Non-U.S.
and Emerging Market Risk (applicable
to International Fund, Short Duration Securitized Bond Fund and Core Bond Fund)
Investing in non-U.S. securities (including depository receipts) involves
special risks in addition to those of U.S. investments. These risks include
political and economic risks, civil conflicts and war, greater market
volatility, expropriation and nationalization risks, currency fluctuations,
higher transaction costs, delayed settlement, possible non-U.S. controls on
investment, and less stringent investor protection and disclosure standards of
non-U.S. markets. The securities markets of many non-U.S. countries are
relatively small, with a limited number of companies representing a small number
of industries. If non-U.S. securities are denominated and traded in a non-U.S.
currency, the value of a fund’s non-U.S. holdings can be affected by currency
exchange rates and exchange control regulations. In certain markets where
securities and other
instruments
are not traded “delivery versus payment,” a fund may not receive timely payment
for securities or other instruments it has delivered and may be subject to
increased risk that the counterparty will fail to make payments when due or
default completely. Events and evolving conditions in certain economies or
markets may alter the risks associated with investments tied to countries or
regions that historically were perceived as comparatively stable becoming
riskier and more volatile. Trade tensions and sanctions on individuals and
companies can contribute to market volatility, which may affect the fund's
Uncertainty relating to withdrawal procedures and time can have adverse effects
on asset valuations and the renegotiation of current trade agreements, as well
as an increase in financial regulation in such markets. This may adversely
impact fund performance.
The
risks associated with non-U.S. securities are magnified in countries in
“emerging markets” compared to more mature markets. Emerging market countries
also may have relatively unstable governments, weaker economies, and
less-developed legal systems with fewer security holder rights. Investments in
emerging markets countries may be affected by government policies that restrict
foreign investment in certain issuers or industries. Emerging market economies
may be based on only a few industries. As a result, security issuers, including
governments, may be more susceptible to economic weakness and more likely to
default. Emerging markets may face greater social, economic, regulatory and
political uncertainties. Emerging market countries may have different
regulatory, accounting, auditing and financial reporting and record keeping
standards and may have material limitations on PCAOB inspections,
investigations, and enforcement. Therefore, the availability and reliability of
information, particularly financial information material to an investment
decision in emerging market companies, may be limited in scope and reliability
as compared to information provided by U.S. companies. These risks make emerging
market securities more volatile and less liquid than securities issued in more
developed countries and you may sustain sudden and sometimes substantial
fluctuations in the value of your investments. A fund’s investments in non-U.S.
and emerging market securities may also be subject to non-U.S. withholding
and/or other taxes, which would decrease the fund’s yield on those securities.
Prepayment
and Call Risk (applicable
to Short Duration Securitized Bond Fund and Core Bond Fund) The funds may invest
in mortgage-backed and asset-backed securities. The issuer of these securities
and other callable securities may be able to repay principal in advance,
especially when interest rates fall. Changes in prepayment rates can affect the
return on investment and yield of mortgage-and asset-backed securities. When
mortgages and other obligations are prepaid and when securities are called, a
fund may have to reinvest in securities with a lower yield. A fund also may fail
to recover additional amounts (i.e., premiums) paid for securities with higher
interest rates, resulting in an unexpected capital loss. Furthermore, some
asset-backed securities may have additional risk because they may receive little
or no collateral protection from the underlying assets, and are also subject to
the risk of default described under “Credit Risk.”
Sector
Emphasis Risk (applicable
to Large Cap Concentrated Fund, Select Fund and International Fund) The
funds, from time to time, may invest 25% or more of its assets in one or more
sectors, subjecting the fund to sector emphasis risk. This is the risk that a
fund is subject to a greater risk of loss as a result of adverse economic,
business or other developments affecting a specific sector in which the fund has
a focused position, than if its investments were diversified across a greater
number of
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industry
sectors. Some sectors possess particular risks that may not affect
other sectors.
Short
Sale Risk The
Long-Short Fund and International Fund may engage in short sales. This is a main
risk for the Long-Short Fund, and an additional risk for the International Fund
as it relates to a non-principal investment strategy. When the Adviser believes
that a security is overvalued, it may sell the security short and borrow the
same security from a broker or other institution to complete the sale. If the
price of the security decreases in value, the funds may make a profit and,
conversely, if the security increases in value, the funds will incur a loss
because they will have to replace the borrowed security by purchasing it at a
higher price. There can be no assurance that the funds will be able to close out
the short position at any particular time or at an acceptable price. Although a
fund’s gain is limited to the amount at which it sold a security short, its
potential loss is not limited. A lender may request that the borrowed securities
be returned on short notice; if that occurs at a time when other short sellers
of the subject security are receiving similar requests, a “short squeeze” can
occur. This means that the funds might be compelled, at the most disadvantageous
time, to replace borrowed securities previously sold short, with purchases on
the open market at prices significantly greater than those at which the
securities were sold short.
At
any time that a fund has an open short sale position, the fund is required to
segregate with its custodian (and to maintain such amount until the fund
replaces the borrowed security) an amount of cash or U.S. Government
securities or other liquid securities equal to at least the difference between
(i) the current market value of the securities sold short and (ii) any
cash or U.S. Government securities required to be deposited with the broker
in connection with the short sale (not including the proceeds from the short
sale). As a result of these requirements, a fund will not gain any leverage
merely by selling short, except to the extent that it earns interest on the
immobilized cash or government securities while also being subject to the
possibility of gain or loss from the securities sold short. However, depending
on arrangements made with the broker or custodian, the fund may not receive any
payments (including interest) on the deposits made with the broker or custodian.
These deposits do not have the effect of limiting the amount of money a fund may
lose on a short sale — the fund’s possible losses may exceed the total amount of
deposits. The Long-Short Fund will not make a short sale if, immediately before
the transaction, the market value of all securities sold short exceeds 40% of
the value of the Long- Short Fund’s net assets. The International Fund will not
make a short sale if, immediately before the transaction, the market value of
all securities sold short exceeds 20% of the value of the fund’s net assets.
The
amount of any gain will be decreased and the amount of any loss increased by any
premium or interest a fund may be required to pay in connection with a short
sale. It should be noted that possible losses from short sales differ from those
that could arise from a cash investment in a security in that the former may be
limitless while the latter can only equal the total amount of a fund’s
investment in the security. For example, if a fund purchases a $10 security, the
most that can be lost is $10. However, if a fund sells a $10 security short, it
may have to purchase the security for return to the lender when the market value
is $50, thereby incurring a loss of $40.
As
the Adviser adjusts the composition of the portfolio to deal with the risk
discussed above, a fund may have a high portfolio turnover rate. Increased
portfolio turnover may result in higher costs for brokerage commissions, dealer
mark-ups and other transaction costs and may also result in taxable capital
gains.
Higher
costs associated with increased portfolio turnover may offset gains in a fund’s
performance. In addition, because of the asset segregation requirement, a fund
may be required to liquidate other portfolio securities that it otherwise might
not have sold in order to meet its obligations, such as paying for redemptions
of fund shares.
Small
and Mid Cap Company Risk This
is a main risk for all funds except the Large Cap Fund, Large Cap Concentrated
Fund, Short Duration Securitized Bond Fund and Core Bond Fund. Investments in
smaller companies involve greater risks than investments in larger, more
established companies. Historically, smaller company securities have been more
volatile in price than larger company securities, especially over the short
term. Among the reasons for the greater price volatility are the
less-than-certain growth prospects of small and medium capitalization companies,
the lower degree of liquidity in the markets for such securities, and the
greater sensitivity of smaller companies to changing economic conditions. In
addition, less frequent trading, with smaller volume than larger capitalization
companies, may make it difficult for the funds to buy and sell shares of smaller
companies. Also, the market price for smaller and medium capitalization
companies tends to rise more in response to demand and fall more in response to
selling pressure than is the case with larger capitalization companies. Further,
smaller companies may lack depth of management, may be unable to generate funds
necessary for growth or development, or may be developing or marketing new
products or services for which markets are not yet established and may never
become established. Smaller companies may be particularly affected by interest
rate increases, as they may find it more difficult to borrow money to continue
or expand operations, or may have difficulty in repaying any loans that have a
floating interest rate.
Additional
Risks
General
Risks All
mutual funds carry a certain amount of risk. You may lose money on your
investment in the funds. The funds are subject to management risk because they
are actively managed funds. The funds may not achieve their objective if the
Adviser’s expectations regarding particular securities or markets are not
met.
Convertible
Securities Risk The
market value of convertible securities and other debt securities tends to fall
when prevailing interest rates rise. The value of convertible securities also
tends to change whenever the market value of the underlying common or preferred
stock fluctuates.
Cybersecurity
Risk
The computer systems, networks and devices used by the funds and their service
providers to carry out routine business operations employ a variety of
protections designed to prevent damage or interruption from computer viruses,
network failures, computer and telecommunication failures, infiltration by
unauthorized persons and security breaches. Despite the various protections
utilized by the funds and their service providers, systems, networks, or devices
potentially can be breached due to both intentional and unintentional events.
The funds and their shareholders could be negatively impacted as a result of a
cybersecurity breach.
Similar
adverse consequences could result from cybersecurity breaches affecting issuers
of securities in which the funds invest; counterparties with which the funds
engage in transactions; governmental and other regulatory authorities; exchange
and other financial market operators, banks, brokers, dealers, insurance
companies, and other financial institutions (including financial intermediaries
and service providers for the funds’ shareholders); and other
parties.
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Cybersecurity
breaches can include unauthorized access to systems, networks, or devices;
infection from computer viruses or other malicious software code; ransomware;
and attacks that shut down, disable, slow, or otherwise disrupt operations,
business processes, or website access or functionality. Cybersecurity breaches
may cause disruptions and impact the funds’ business operations, potentially
resulting in financial losses; may negatively impact the financial condition of
an issuer, counterparty or other market participant; interference with the
funds’ ability to calculate their NAVs; impediments to trading; the inability of
the funds, the Adviser, and other service providers to transact business;
violations of applicable privacy and other laws; regulatory fines, penalties,
reputational damage, reimbursement or other compensation costs, or additional
compliance costs; as well as the inadvertent release of confidential
information.
In
addition, substantial costs may be incurred by these entities in order to
prevent any cybersecurity breaches in the future. Neither the funds or the
Adviser control the cybersecurity systems of issuers or third-party service
providers.
Illiquid
Securities Risk A
fund may invest up to 15% of the value of its net assets in securities that are
illiquid. An illiquid investment is any investment that cannot be disposed of in
current market conditions within seven days in the normal course of business at
approximately the amount at which it is valued by the fund and without
significantly changing the value of the investment. The price a fund pays for
illiquid securities or receives upon resale may be lower than the price paid or
received for similar securities with a more liquid market. In addition, there
may be no market or a limited market in which to sell illiquid securities.
Inflation-Indexed
Bonds Risk (applicable
to Short Duration Securitized Bond Fund and Core Bond Fund) Inflation-indexed
bonds are fixed income securities whose principal value is periodically adjusted
according to the rate of inflation. If the index measuring inflation falls, the
principal value of inflation-indexed bonds will be adjusted downward, and
consequently the interest payable on these securities (calculated with respect
to a smaller principal amount) will be reduced. Repayment of the original bond
principal upon maturity (as adjusted for inflation) is guaranteed in the case of
U.S. Treasury inflation-indexed bonds. For bonds that do not provide a
similar guarantee, the adjusted principal value of the bond repaid at maturity
may be less than the original principal. The value of inflation-indexed bonds is
expected to change in response to changes in real interest rates. Real interest
rates are tied to the relationship between nominal interest rates and the rate
of inflation. If nominal interest rates increase at a faster rate than
inflation, real interest rates may rise, leading to a decrease in value of
inflation-indexed bonds. Short-term increases in inflation may lead to a decline
in value. Any increase in the principal amount of an inflation-indexed bond will
be considered taxable ordinary income, even though investors do not receive
their principal until maturity.
Investment
Company and Exchange Traded Fund ("ETF") Risk A
fund may invest in shares of other investment companies or ETFs. Shareholders
will indirectly bear fees and expenses charged by the underlying investment
companies in which the fund invests in addition to the fund’s direct fees and
expenses. The fund also will incur brokerage costs when it purchases ETFs and
closed-end funds. In addition, the funds will be subject to the risks associated
with the investment company or ETF's investments. The price movement of an ETF
may not track the underlying index and may result in a loss. The closed-end
investment company or ETF may trade at a price above (premium) or below
(discount) their net asset value, especially during periods of significant
volatility or stress,
causing
investors to pay significantly more or less than the value of the ETF's
underlying portfolio. Furthermore, investments in other funds could affect the
timing, amount and character of distributions to shareholders and therefore may
increase the amount of taxes payable by investors in the fund. To the extent a
fund invests in an underlying Diamond Hill Fund, because the Adviser provides
services to and receives fees from the underlying fund, a fund’s investment in
the underlying fund benefits the Adviser. In addition, the fund may hold a
significant percentage of the shares of the underlying fund. As a result, a
fund’s investment in an underlying fund may create a conflict of interest.
Large
Shareholder Redemption Risk Certain
individuals accounts, or institutions, including the Adviser and its affiliates,
may from time to time own or control a substantial amount of a fund's shares.
There is no requirement that these entities maintain their investment in the
fund. There is a risk that such large shareholders may redeem all or a
substantial portion of their investments in a fund at any time, which could have
a significant negative impact on the fund's NAV, liquidity, and brokerage costs.
Large redemptions could also result in tax consequences to shareholders and
impact the fund's ability to implement its investment strategy.
Maturity
Risk (applicable
to Short Duration Securitized Bond Fund and Core Bond Fund) In certain
situations the funds may purchase a bond of a given maturity as an alternative
to another bond of a different maturity. Ordinarily, under these circumstances,
a fund will make an adjustment to account for the interest rate risk
differential in the two bonds. This adjustment, however, makes an assumption
about how the interest rates at different maturities will move. To the extent
that the yield movements deviate from this assumption, there is a yield-curve or
maturity risk. Another situation where yield-curve risk should be considered is
in the analysis of bond swap transactions where the potential incremental
returns are dependent entirely on the parallel shift assumption for the yield
curve.
Securities
Lending Risk To
generate additional income, the funds may lend their portfolio securities to
financial institutions under guidelines adopted by the Board of Trustees,
including a requirement that the funds receive cash or securities issued by the
United States government or its agencies or instrumentalities as collateral from
the borrower equal to no less than 100% of the market value of the securities
loaned. The funds may invest the cash collateral in high quality short-term debt
obligations, government obligations, bank guarantees or money market mutual
funds. Securities lending involves two primary risks: “investment risk” and
“borrower default risk.” Investment risk is the risk that the funds will lose
money from the securities received as collateral or the investment of the cash
collateral. Borrower default risk is the risk that the funds will lose money due
to the failure of a borrower to return a borrowed security in a timely manner.
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Temporary
Strategies
From
time to time, each fund may take temporary defensive positions that are
inconsistent with the fund’s principal investment strategies, in attempting to
respond to adverse market, economic, political, or other conditions. During
these times, the fund may invest up to 100% of its assets in cash and cash
equivalents. For example, a fund may hold all or a portion of its assets in
money market instruments (high quality income securities with maturities of less
than one year), securities of money market funds or U.S. Government
repurchase agreements. A fund may also invest in such investments at any time to
maintain liquidity or pending selection of investments in accordance with its
policies. These investments may prevent a fund from achieving its investment
objective. If a fund acquires securities of money market funds, the shareholders
of the fund will be subject to duplicative management fees and other expenses.
Portfolio
Holdings Disclosure
No
later than 60 days after the end of each month, each fund will post on the
funds' web site, www.diamond-hill.com, a complete schedule of its portfolio
holdings as of the last day of that month. In addition to this monthly
disclosure, each fund may also make publicly available its portfolio holdings at
other dates as may be determined from time to time.
Shareholders
may request portfolio holdings schedules at no charge by calling 888-226-5595. A
description of the funds’ policies and procedures with respect to the disclosure
of the funds’ portfolio holdings is available in the Statement of Additional
Information.
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Management
of the Funds
Diamond
Hill Capital Management, Inc. (the “Adviser”), 325 John H. McConnell
Boulevard, Suite 200, Columbus, Ohio 43215, manages the day-to-day
investment decisions of the funds and continuously reviews, supervises and
administers the funds’ investment programs. The Adviser has been an investment
adviser to individuals, pension and profit sharing plans, trusts, corporations
and other institutions since June 2, 1988. As
of December 31, 2022, the Adviser managed approximately $24.8 billion
in assets.
Pursuant
to the investment advisory contract between the Adviser and the funds, the
Adviser, subject to the supervision of the Board of Trustees and in conformity
with the stated objective and policies of each fund, manages both the investment
operations of the funds and the composition of the funds’ portfolios, including
the purchase, retention and disposition of securities. In connection therewith,
the Adviser is obligated to keep certain books and records of the funds. The
Adviser also administers the corporate affairs of the funds, and in connection
therewith, furnishes the funds with office facilities, together with those
ordinary clerical and bookkeeping services which are not being furnished by the
funds’ custodian, and the funds’ sub-administrator, sub-fund accountant and
sub-transfer agent. The management services of the Adviser are not exclusive
under the terms of the investment advisory contract and the Adviser is free to,
and does, render management services to others.
Disclosure
regarding the basis for the Board of Trustees’ approval of the investment
advisory contract between the Adviser and the funds is available in the funds’
annual report to shareholders for the year ended December 31, 2022.
The
funds are authorized to pay the Adviser an annual fee as set forth below:
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Fund |
Percentage of
Average Daily Net Assets |
Diamond
Hill Small Cap Fund |
0.80% |
Diamond
Hill Small-Mid Cap Fund |
0.75% |
Diamond
Hill Mid Cap Fund |
0.60% |
Diamond
Hill Large Cap Fund |
0.50% |
Diamond
Hill Large Cap Concentrated Fund |
0.50% |
Diamond
Hill Select Fund |
0.70% |
Diamond
Hill Long-Short Fund |
0.90% |
Diamond
Hill International Fund |
0.65% |
Diamond
Hill Short Duration Securitized Bond Fund |
0.35% |
Diamond
Hill Core Bond Fund |
0.30% |
Portfolio
Managers
|
|
|
|
|
|
|
| |
Fund |
Portfolio
Manager |
Assistant
Portfolio Manager |
Small
Cap |
Aaron
Monroe |
Christopher
Welch |
Small-Mid
Cap |
Christopher
Welch |
|
Mid
Cap |
Christopher
Welch |
Christopher
Bingaman |
Large
Cap |
Charles
Bath Austin Hawley |
|
Large
Cap Concentrated |
Charles
Bath Austin Hawley |
|
Select |
Austin
Hawley Richard Snowdon |
|
Long-Short |
Christopher
Bingaman Nathan Palmer |
Charles
Bath
|
International |
Krishna
Mohanraj |
|
Short
Duration Securitized Bond |
Henry
Song Mark Jackson |
|
Core
Bond |
Henry
Song Mark Jackson |
|
The
Portfolio Managers (PMs) hold ultimate responsibility and accountability for the
investment results of the portfolios and have full authority to make all
investment decisions. The Assistant Portfolio Manager (APM) provides significant
analytical support to the PMs and serves as a backup to the PMs with authority
to make investment decisions when the PMs are unavailable.
Mr.
Bath
has a Bachelor of Science degree in Accounting from Miami University, a Master’s
of Business Administration from The Ohio State University and holds the CFA
designation. Mr. Bath currently serves as a Portfolio Manager for the
Adviser. From 1985 to September 2002, Mr. Bath was a senior portfolio
manager for Gartmore Global Investments, a global investment firm affiliated
with Nationwide Insurance. Mr. Bath was first employed by Nationwide
Insurance as an investment professional in 1982.
Mr. Bingaman
has a Bachelor of Arts degree in Finance (cum laude) from Hillsdale College, a
Masters degree in Business Administration from the University of Notre Dame and
holds the CFA designation. He has been an investment professional with the
Adviser since March 2001. He currently serves as a Portfolio Manager for the
Adviser. He was the President of the Adviser from January 2014 through August
2019 and Chief Executive Officer of the Adviser from January 2016 through August
2019. From 1998 to March 2001, Mr. Bingaman was a Senior Equity Analyst for
Villanova Capital/Nationwide Insurance. In 1997, Mr. Bingaman was an Equity
Analyst for Dillon Capital Management, an investment advisory firm.
Mr. Hawley
has a Bachelor of Arts degree in History (cum laude) from Dartmouth College, a
Masters degree in Business Administration (with distinction) from Tuck School of
Business at Dartmouth College and holds the CFA designation. He has been an
investment professional with the Adviser since August 2008. Mr. Hawley
currently serves as a Portfolio Manager for the Adviser. From July 1999 to
July 2002, Mr. Hawley was an Investment Associate at Putnam
Investments. He was an Equity Analyst at Putnam Investments from July 2004
to July 2008.
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Mr.
Jackson
has a Bachelor of Science in Finance degree from Miami University and holds the
CFA designation. He has been an investment professional with the Adviser since
June 2016. Mr. Jackson currently serves as a Portfolio Manager for the
Adviser. From 1996 to 2016, he was with J.P. Morgan Investment Management, Inc.
where he was Managing Director and portfolio manager for the U.S. Value Driven
team and was responsible for managing institutional taxable bond
portfolios. Prior to 1996, Mr. Jackson was a portfolio manager for
Alexander Hamilton Life Insurance Company and previous to that a portfolio
manager with the Public Employees Retirement System of Ohio.
Mr. Mohanraj
has a Bachelor of Technology from the Indian Institute of Technology, Madras
(Chennai, India), a Master of Science from The University of Texas at Austin, a
Master of Business Administration from the London Business School (with
distinction) and holds the CFA designation. Mr. Mohanraj has been an
investment professional with the Adviser since 2012. Mr. Mohanraj currently
serves as a Portfolio Manager for the Adviser. From 2011 to 2012,
Mr. Mohanraj was a Senior Research Associate at Sanford C. Bernstein. From
2008 to 2009, he was a Quantitative Analyst at Exelon Corporation. From 2005 to
2008, Mr. Mohanraj was a Product Manager with MCA Solutions. From 1999 to
2004, Mr. Mohanraj was a Solution Architect with i2 Technologies.
Mr. Monroe
has
a Bachelor of Science degree in Finance, Accounting and Economics from The Ohio
State University (cum laude) and holds the CFA designation. He has been an
investment professional with the Adviser since June 2007. Mr. Monroe
currently serves as a Portfolio Manager for the Adviser. From 2006 to 2007,
Mr. Monroe was a Consulting Group Analyst with Smith Barney. In 2005,
Mr. Monroe was an Associate with Duff & Phelps.
Mr. Palmer
has
a Bachelor of Science degree in Accounting and Finance from The Ohio State
University (summa cum laude, with honors) and a Masters of Accountancy from The
Ohio State University (with distinction). He is a Certified Public Accountant
and holds the CFA designation. He has been an investment professional with the
Adviser since October 2009. Mr. Palmer currently serves as a Portfolio
Manager for the Adviser. From 2008 to 2009, Mr. Palmer was a Tax Consultant
with Deloitte & Touche, LLP.
Mr. Snowdon
has a Bachelor of Arts degree in Economics and Organizational
Behavior & Management from Brown University, a Masters degree in
Business Administration (with distinction) from Northwestern University and
holds the CFA designation. He has been an investment professional with the
Adviser since August 2007. Mr. Snowdon currently serves as a Portfolio
Manager for the Adviser. From 2003 to 2006, Mr. Snowdon served as a Board
member and Consultant with Adams Rite Manufacturing. From 1997 to 2002,
Mr. Snowdon was an Energy Trader/Vice President, Energy Trading for
American Electric Power. From 1996 to 1997, Mr. Snowdon was a Junior Trader
with Enron Corporation. From 1989 to 1994, Mr. Snowdon managed a chain of
40 independent World Oil gas stations.
Mr.
Song
has a Bachelor of Business Administration degree from the Ross School of
Business at the University of Michigan and holds the CFA designation. He has
been an investment professional with the Adviser since June 2016. Mr. Song
currently serves as a Portfolio Manager for the Adviser. From 2005 to 2016 he
was with J.P. Morgan Investment Management, Inc. where he was a portfolio
manager for the U.S. Value Driven team and was responsible for managing
institutional taxable bond portfolios and previously supported the Columbus
taxable client portfolio managers in reporting as well as client communications.
Mr. Welch
has a Bachelor of Arts degree in Economics (summa cum laude) from Yale
University and holds the CFA designation. He has been an investment professional
with the Adviser since November 2005. Mr. Welch currently serves as
Portfolio Manager for the Adviser. From 2004 to November 2005, Mr. Welch
was a Portfolio Manager for Fiduciary Trust Company International, an
investment management firm. From 1995 to 2002, Mr. Welch served as
Portfolio Manager and Senior Equity Analyst for Nationwide Insurance and its
mutual fund unit, Gartmore Global Investments.
The
Statement of Additional Information provides additional information about each
portfolio manager’s compensation structure, other managed accounts and ownership
of securities in their managed fund(s).
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Pricing
Your Shares
When
you buy and sell shares of a fund, the price of the shares is based on the
fund’s net asset value per share (NAV) next determined after the order is
received. The NAV is calculated at the close of trading (normally
4:00 p.m., Eastern time ) on each day the New York Stock Exchange (“NYSE”)
is open for business (“open business day”). Should the NYSE experience an
unexpected market closure or restriction on trading during or on what is
expected to be an open business day, the fund will make a determination whether
to calculate the NAV at the times as described above (and value the securities
as described below in this prospectus and in the Statement of Additional
Information) or to suspend the determination of the NAV based on available
information at the time of or during the unexpected closure or restriction on
trading. Purchase requests received by a fund or an authorized agent of a fund
after the NYSE closes, or on a day on which the NYSE is not open for trading,
will be effective on the next open business day thereafter on which the NYSE is
open for trading, and the offering price will be based on the fund’s NAV at the
close of trading on that day. A separate NAV is calculated for each share class
of a fund. The NAV for a class is calculated by dividing the value of the fund’s
total assets (including interest and dividends accrued but not yet received),
allocable to that class, minus liabilities (including accrued expenses)
allocable to that class, by the total number of that class’ shares outstanding.
The market value of a fund’s investments is determined primarily on the basis of
readily available market quotations.
If
market quotations are not readily available or if available market quotations
are determined not to be reliable or if a security’s value has been materially
affected by events occurring after the close of trading on the exchange or
market on which the security is principally traded (for example, a natural
disaster affecting an entire country or region, or an event that affects an
individual company), but before a fund’s NAV is calculated, that security may be
valued at its fair value in accordance with policies and procedures adopted by
the fund’s Board of Trustees. Without a fair value price, short term traders
could take advantage of the arbitrage opportunity and dilute the NAV of long
term investors. To the extent that a fund invests in securities that are
primarily listed on non-U.S. exchanges or other markets that trade on weekends
or other days when a fund is closed, the value of a fund’s shares may change on
days when you will not be able to purchase or redeem your shares. In addition,
securities trading on non-U.S. markets present time zone arbitrage opportunities
when events affecting portfolio security values occur after the close of the
non-U.S. market, but prior to the close of the U.S. market. Fair valuation
of a fund’s portfolio securities can serve to reduce arbitrage opportunities
available to short term traders, but there is no assurance that fair value
pricing policies will prevent dilution of a fund’s NAV by short term traders.
Fair valuation involves subjective judgments and it is possible that the fair
value determined for a security may differ materially from the value that could
be realized upon the sale of the security.
If
you purchase shares of any of the funds through a Processing Organization, as
discussed below, it is the responsibility of the authorized agent to transmit
properly completed purchase orders so that they will be received timely by the
Trust. Any change in price due to the failure of the Trust to receive an order
timely must be settled between the investor and the authorized agent placing the
order.
How
to Purchase Shares
Shares
of the funds have not been registered for sale outside of the United States and
the funds are generally only available to residents in the United States with a
valid tax identification number. This prospectus is not intended for
distribution to prospective investors outside of the United States. The funds
generally do not market or sell shares to investors domiciled outside of the
United States, even if the investors are citizens or lawful permanent residents
of the United States. Any non-U.S. shareholders generally would be subject to
U.S. tax withholding on distributions by the funds. This prospectus does not
address in detail the tax consequences affecting any shareholder who is a
nonresident alien individual or non-U.S. trust or estate, non-U.S. corporation
or non-U.S. partnership.
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The
following table summarizes different features and eligibility requirements of
each Class of the funds.
Choosing
a Share Class
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Eligibility |
Investor |
Class
I |
Class
Y |
May
be purchased by the general public (except for Short Duration Securitized
Bond Fund) |
ü |
| |
|
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| |
May
be purchased by institutional investors, such as corporations, pension,
profit sharing, or defined contribution plans, non-profit organizations,
charitable trusts, foundations and endowments |
ü |
ü |
ü |
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| |
May
be purchased by individual investors, through financial intermediaries
that have entered into agreements with Diamond Hill Funds or its
agents |
ü |
ü |
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May
be purchased by financial intermediaries on behalf of individual investors
provided such intermediary:
1.is
acting in an investment advisory capacity,
2.enters
into an agreement with the applicable fund or the Adviser to purchase and
redeem such shares through an omnibus account, and
3.
agrees to not charge the applicable fund, its investment adviser or any
other affiliates, any sub-transfer agent fees, service fees, networking
fees, distribution fees, marketing fees, or any other fees for the entire
life of the investment in Class Y shares. |
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| ü |
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May
be purchased by Trustees, Directors, and employees of Diamond Hill Funds
or Diamond Hill Investment Group, Inc. and their immediate family
members |
ü |
ü |
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| |
Initial
Investment Minimum |
$2,500 |
$2,500 |
$500,000 |
May
be waived for corporate sponsored, participant directed group retirement
accounts |
ü |
ü |
ü |
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| |
May
be waived for investors who purchased shares through financial
intermediaries that have entered into agreements with Diamond Hill Funds
or its agents |
ü |
ü |
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May
be waived for individual investors who purchased Class Y shares through
financial intermediaries that have entered into an agreement with the
applicable fund or the Adviser as described above. |
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May
be waived in other circumstances as deemed appropriate |
ü |
ü |
ü |
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Additional
Compensation to Financial Intermediaries Permitted |
ü |
ü |
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Financial
Intermediaries
Financial
intermediaries or such other organizations may impose eligibility requirements
for each of their clients or customers investing in the funds, including
investment minimum requirements, which may be the same or differ from the
requirements for investors purchasing directly from the funds, and certain
financial intermediaries may charge their customers transaction or other fees.
Certain share classes may not be available through all financial intermediaries.
The funds or Adviser may pay service and/or distribution fees to these entities
for services they provide to Investor and Class I shareholders.
Investor
shares of
all funds, except the Short Duration Securitized Bond Fund, are available to the
general public. Investor shares may also be purchased through financial
intermediaries that have entered into agreements with Diamond Hill Funds or its
agents. Financial intermediaries may include financial advisors, investment
advisors, brokers, financial planners, banks, insurance companies, retirement or
401(k) plan administrations or any
other
organization authorized to act in a fiduciary, advisory, custodial or agency
capacity for its clients or customers.
Class
I
shares
of all funds and Investor shares of the Short Duration Securitized Bond Fund are
available for purchase by institutional investors such as corporations, pension
and profit sharing or defined contribution plans, non-profit organizations,
charitable trusts, foundations and endowments. Class I shares of all
funds and Investor shares of the Short Duration Securitized Bond Fund may also
be purchased through financial
intermediaries
that have entered into agreements with Diamond Hill Funds or its agents.
Financial intermediaries may include financial advisors, investment advisors,
brokers, financial planners, banks, insurance companies, retirement or 401(k)
plan administrations or any other organization authorized to act in a fiduciary,
advisory, custodial or agency capacity for its clients or
customers.
Class I
shares of all funds and Investor shares of the Short Duration Securitized Bond
Fund may also be purchased by officers, trustees, directors and employees, and
their immediate family members (i.e., spouses, children, grandchildren, parents,
grandparents and any dependent of the person, as defined in Section 152 of
the Internal Revenue Code), of Diamond Hill Funds or Diamond Hill
Investment Group, Inc. and its subsidiaries and affiliates.
Class
Y
shares
are available for purchase by institutional investors such as corporations,
pension and profit sharing or defined contribution plans, non-profit
organizations, charitable trusts, foundations and endowments.
Class
Y shares may also be purchased by individual investors, if purchased through
financial intermediaries authorized to act in an investment advisory capacity
that have entered into a written agreement with the Adviser or the applicable
fund to offer such shares through an omnibus account held at the fund.
All
Class Y purchases of a fund, whether purchased by an institutional investor or
by a financial intermediary on behalf of an individual investor, will not
require the fund, its investment
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DIAMOND
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adviser
or any other affiliates, to make any sub-transfer agent, service, networking,
distribution-related, marketing, maintenance, revenue sharing or any other fees
or payments to any third party now or for the entire life of the investment in
Class Y shares. Class Y shares have no ongoing shareholder service fees.
Minimum
Initial Investment
amount for Investor and Class I shares is $2,500. The minimum initial investment
amount for Class Y is $500,000. If a financial intermediary maintains an omnibus
account for institutional investors in Class Y shares, each subaccount
underlying the Omnibus Account must meet the minimum initial investment in order
for the Omnibus Account to be eligible to own Class Y shares.
1.The
funds may waive the investment minimums for corporate participant directed
retirement accounts (such as 401(k) accounts).
2.The
funds may waive the initial investment minimums for Investor and Class I shares
purchased through financial intermediaries that have entered into a written
agreement with the funds or its agents.
3.The
funds may waive the initial investment minimums for Class Y shares purchased
through financial intermediaries authorized to act in an investment advisory
capacity that have entered into a written agreement with the Adviser to offer
such shares through an omnibus account held at the fund.
4.The
funds may waive the investment minimums in other circumstances as it may
judge appropriate.
All
investments and exchanges are subject to approval by a fund and the fund
reserves the right to reject any purchase or exchange of shares at any time. The
funds request advance notification of investments in excess of 5% of the current
net assets of the fund.
All
classes of the funds may not be available in every state.
Important
Information About the Small-Mid Cap Fund
The
Small-Mid Cap Fund is closed to most new investors. The fund remains open to
additional investments under the circumstances listed below:
•Existing
shareholders of the fund may add to their accounts, including through
reinvestment of distributions.
•Qualified
defined contribution retirement plans, such as a 401(k), 403(b) or 457 plans,
that utilized the fund as an investment option on the date the fund closed, may
continue to establish new participant accounts in the funds for those plans.
•Financial
Advisors who had clients invested in the fund on the date the fund closed, may
establish new positions in the fund for new clients where operationally
feasible.
•Investors
may purchase the fund through certain intermediary sponsored fee-based model
programs, provided that the sponsor has received permission from Diamond Hill
Funds that shares of the fund may continue to be offered through the program.
Approved or recommended lists are not considered model portfolios.
• Trustees,
Directors, and employees of Diamond Hill Funds or Diamond Hill Investment Group,
Inc. and their immediate family members may open new accounts and purchase
shares of the fund.
In
general, the fund will look to the financial intermediary to prevent a new
account from being opened within an omnibus account at that intermediary. The
fund's ability to monitor new accounts that are opened through omnibus accounts
or other
nominee
accounts is limited and the ability to limit a new account to those that meet
the above criteria with respect to financial intermediaries may vary depending
upon the capabilities and cooperation of those intermediaries.
The
fund reserves the right to make additional exceptions or otherwise modify the
foregoing closure policy at any time. The fund also reserves the right to reject
any purchase or refuse any exception, including those detailed above for any
reason.
Important
Information About Procedures for Opening an Account
Federal
law requires all financial institutions to obtain, verify and record information
that identifies each person who opens an account. What this means for you: When
you open an account, we will ask for your name, residential address, date of
birth, government identification number and other information that will allow us
to identify you. We may also ask to see your driver’s license or other
identifying documents. If we do not receive these required pieces of
information, there may be a delay in processing your investment request, which
could subject your investment to market risk. If we are unable to immediately
verify your identity, the fund may restrict further investment until your
identity is verified. If we are unable to verify your identity, the fund
reserves the right to close your account without notice and return your
investment to you at the NAV determined on the day in which your account is
closed. If we close your account because we are unable to verify your identity,
your investment will be subject to market fluctuation, which could result in a
loss of a portion of your principal investment.
Fund Supermarkets
and Clearing Organizations
You
may purchase shares of a fund through a fund supermarket or clearing
organization, which is a broker-dealer, bank or other financial institution that
purchases shares for its customers (Processing Organization). The funds have
authorized certain Processing Organizations to receive purchase and sale orders
on their behalf. Before investing in the funds through a Processing
Organization, you should read carefully any materials provided by the Processing
Organization together with this prospectus.
When
shares are purchased this way, there may be various differences. The Processing
Organization may:
• Charge
a fee for its services.
• Act
as the shareholder of record of the shares.
• Set
different minimum initial and additional investment requirements.
• Impose
other charges and restrictions.
• Designate
intermediaries to accept purchase and sale orders on the fund’s behalf.
• Impose
an earlier cut-off time for purchase and redemption requests.
The
Trust considers a purchase or sale order as received when an authorized
Processing Organization, or its authorized designee, receives the order in
proper form. These orders will be priced based on the respective fund’s net
asset value next computed after such order is received in proper form. It is the
responsibility of the authorized agent to transmit properly completed purchase
orders so that they will be received timely by the Trust.
Shares
held through a Processing Organization may be transferred into your name
following procedures established by your Processing Organization and the Trust.
Certain Processing Organizations may receive compensation from the Trust, the
Adviser or their affiliates.
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Fund Direct
Purchase
You
may also make a direct initial investment by following these steps:
• Complete
and sign an investment application form which you can request by calling the
funds at 888-226-5595 between the hours of 8:00 a.m. and
6:00 p.m. Eastern time on days the funds are open for business. On
days when the NYSE closes early, the call center hours will be reduced
accordingly.
•
Make your check (drawn on a U.S. bank and payable
in U.S. dollars) payable to the fund in which you are investing. We do not
accept post-dated checks, third party checks, travelers’ checks, cash, money
orders, cashier checks greater than $10,000, credit card convenience checks or
“starter” checks.
• Mail
the application and check to: (Fund Name) P.O. Box 46707, Cincinnati,
OH 45246
To
purchase shares of a fund by wire, call the funds at 888-226-5595 between the
hours of 8:00 a.m. and 6:00 p.m. Eastern time on days the funds
are open for business for instructions. On days when the NYSE closes early, the
call center hours will be reduced accordingly. A fund will accept wire orders
only on a day on which the fund, the Custodian and the Transfer Agent are open
for business. A wire purchase will be considered made when the wired money is
received and the purchase is accepted by the fund. Any delays that may occur in
wiring money, including delays that may occur in processing by the banks, are
not the responsibility of the fund or the Transfer Agent. There is presently no
fee for the receipt of wired funds, but the funds may charge a fee in the
future.
AIP
Program
When
making your initial investment in a fund, you may choose to participate in the
fund’s automatic investment program (AIP) by completing the AIP section of the
application form discussed above. Purchase amounts ($100 minimum) are
automatically debited each month from your bank account through ACH (automated
clearing house) and are subject to the payment of any applicable sales
charge.
Sales
Charges
Shares
of the funds are purchased at their NAV.
The
funds’ principal underwriter compensates Financial Intermediaries (such as
broker-dealers), including processing organizations, who sell shares of the
funds. Compensation comes from Rule 12b-1 fees and payments by the
principal underwriter or affiliates of the principal underwriter and from its or
their own resources.
The
funds' shares may be available at brokerage firms that have agreements with the
funds' distributor. Shareholders may be required to pay a commission and/or
other form of compensation to the broker. Shares of the funds are available in
share classes that have different fees and expenses.
Distribution
Plan
Each
fund has adopted a plan under Rule 12b-1 that allows its Investor shares to
pay distribution fees. Up to 0.25% of the Investor shares' 12b-1 fee can be used
as a shareholder servicing fee. Investor shares pay annual 12b-1 expenses of
0.25%. Because these fees are paid out of a fund’s assets on an on-going basis,
over time these fees will increase the cost of your investment and may cost you
more than paying other types of sales charges.
Additional
Compensation to Financial Intermediaries
Diamond
Hill Capital Management, Inc., the Adviser and Administrator, may make payments
to financial intermediaries
that
can be categorized as “service-related” or “distribution-related.”
Payments
made by the Administrator to financial intermediaries to compensate or reimburse
them for administrative or other client services provided, such as sub-transfer
agency services for shareholders or retirement plan participants, omnibus
accounting or sub-accounting, participation in networking arrangements, record
keeping and other shareholder services are categorized as “servicing related.”
Payments made pursuant to such agreements generally are based on either
(a) a percentage of the average daily net assets of clients serviced by
such financial intermediaries, or (b) the number of accounts serviced by
such financial intermediary.
Payments
made by the Adviser from its own resources to financial intermediaries that are
in addition to, rather than in lieu of, Rule 12b-1 fees for distribution-related
expenses, such as marketing or promotional expenses, are often referred to as
“distribution-related.” Distribution-related payments may be made on the basis
of the sales of shares attributable to that intermediary, the average net assets
of the fund and other Diamond Hill Funds attributable to the accounts of that
intermediary and its clients, negotiated lump sum payments for distribution
services provided, or similar fees. In some circumstances, distribution-related
payments may create an incentive for a financial intermediary or its
representatives to recommend or offer shares of the fund or other Diamond Hill
Funds to its customers or provide an incentive for a financial intermediary to
cooperate with the Distributor’s marketing efforts by providing representatives
of the Distributor with preferential access to representatives of the
intermediary’s sales force. Distribution-related payments may also be used to
reimburse expenses related to educational seminars and “due diligence” or
training meetings (to the extent permitted by applicable laws or the rules of
the Financial Industry Regulatory Authority (“FINRA”)) designed to increase
sales representatives’ awareness about Diamond Hill Funds, including travel and
lodging expenditures.
Other
Purchase Information
The
funds reserve the right to limit the amount of purchases and to refuse to sell
to any person. When purchasing shares of the funds by check, the check must be
made out to the applicable fund, or the Trust, as the payee. If your check or
wire does not clear, you will be responsible for any loss incurred by a fund. If
you are already a shareholder of a fund, we reserve the right to redeem shares
from any identically registered account in the Trust as reimbursement for any
loss incurred or money owed to the Trust. You may be prohibited or restricted
from making future purchases in the funds.
How
to Redeem Shares
You
may redeem all or part of your investment in a fund on any day that the New York
Stock Exchange is open for trading, subject to certain restrictions described
below. Redemption requests received by a fund or an authorized agent of the fund
before 4:00 p.m. ET (or before if the NYSE closes before
4:00 p.m. ET) will be effective that day. The price you will receive
when you redeem your shares will be the NAV (less any applicable sales charges)
next determined after the fund receives your properly completed order to sell.
You may receive proceeds of your sale in a check, ACH, or federal wire transfer.
The funds typically expect that it will take one to three days following the
receipt of your redemption request to pay out redemption proceeds; however,
while not expected, payment of redemption proceeds may take up to seven days.
The proceeds may be more or less than the purchase price of your shares,
depending on the market value of the fund’s securities at the
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time
of your sale. If you sell shares through your Financial Intermediary, contact
your financial adviser for their requirements and procedures. A broker may
charge a transaction fee to redeem shares. The fund may charge $9 for wire
redemptions. Any charges for wire redemptions will be deducted from your account
by redemption of shares. The funds encourage, to the extent possible,
advance notification of large redemptions. The funds typically expect that a
fund will hold cash or cash equivalents to meet redemption requests. The funds
may also use the proceeds from the sale of portfolio securities to meet
redemption requests if consistent with the management of the fund. These
redemption methods will be used regularly and may also be used in stressed
market conditions. The funds reserve the right to redeem in-kind as described
under “Additional Information” below. Redemptions in-kind are typically used to
meet redemption requests that represent a large percentage of a fund’s net
assets in order to minimize the effect of large redemptions on the fund and its
remaining shareholders. Redemptions in-kind may be used regularly in
circumstances as described above, and may also be used in stressed market
conditions.
By
Mail To
redeem any part of your account in a fund by mail, send a written request, with
the following information, to:
(Fund Name)
Diamond
Hill Funds
P.O. Box 46707
Cincinnati,
OH 45246
• the
fund name;
• your
account number;
• the
name(s) on your account;
• your
address;
• the
dollar amount or number of shares you wish to redeem;
• the
signature of all registered account owners, signed in the exact name(s) and any
special capacity in which they are registered; and
• the
Federal tax withholding election (for retirement accounts).
• If
the shares to be redeemed have a value of $100,000 or more, your signature(s)
must be guaranteed by an original Medallion Signature Guarantee by an eligible
guarantor institution outlined below.
• You
must request the redemption in writing with your signature guaranteed by a
Medallion Signature Guarantee, regardless of the value of the shares being
redeemed if: the address on your account has been changed within 15 days of
your redemption request; the check is not being mailed to the address on your
account; the check is not being made payable to the owner(s) of the account; the
redemption proceeds are being transferred to another fund account with a
different registration or; the redemption proceeds are being wired to bank
instructions currently not on your account.
We
accept original signature guarantees from U.S. banks, brokers, dealers, credit
unions, national securities exchanges, registered securities associations,
clearing agencies and savings and loan associations participating in a Medallion
program. The three recognized medallion programs are Securities Transfer Agent
Medallion Program (STAMP), Stock Exchanges Medallion Program (SEMP) and New York
Stock Exchange, Inc. Medallion Signature Program (MSP). SIGNATURE GUARANTEES
RECEIVED FROM INSTITUTIONS NOT PARTICIPATING IN THESE PROGRAMS WILL NOT BE
ACCEPTED. In certain instances, we may require you to furnish additional legal
documents to insure proper authorization.
By
Telephone If
you have completed the Optional Telephone Redemption and Exchange section of
your investment application, you may sell any part of your account by calling
the funds at 888-226-5595 between the hours of 8:00 a.m. and
6:00 p.m. Eastern time on days the funds are open for business. On
days when the NYSE closes early, the call center hours will be between reduced
accordingly. IRA accounts are not redeemable by telephone.
Neither
the funds nor the Transfer Agent will be liable for complying with telephone
instructions they reasonably believe to be genuine or for any loss, damage, cost
or expenses in acting on such telephone instructions. The affected shareholders
will bear the risk of any such loss. The funds or the Transfer Agent, or both,
will employ reasonable procedures to determine that telephone instructions are
genuine. If the funds and/or the Transfer Agent do not employ such procedures,
they may be liable for losses due to unauthorized or fraudulent instructions.
Such procedures may include, among others, requiring forms of personal
identification before acting upon telephone instructions, providing written
confirmation of the transactions, and/or digitally recording telephone
instructions.
We
may terminate the telephone sale procedures at any time. During periods of
extreme market activity it is possible that you may encounter some difficulty in
telephoning us, although we have never experienced difficulties in receiving or
in a timely fashion responding to telephone requests. If you are unable to reach
us by telephone, you may request a sale by mail. An original Medallion Signature
Guarantee is required for any telephone redemption request for an amount of at
least $100,000 as described above. A telephone redemption request for an amount
of at least $100,000 as described above will not be processed until the
Medallion Signature Guarantee is received by the Transfer Agent.
Additional
Information Redemptions
will be remitted to the record holder at the address of record or to bank
accounts of the shareholder that have been previously designated by the
shareholder. If you are not certain of the requirements for a sale please call
the fund at 888-226-5595 between the hours of 8:00 a.m. and
6:00 p.m. Eastern time on days the funds are open for business. On
days when the NYSE closes early, the call center hours will be reduced
accordingly. We cannot accept, and will return, requests specifying a certain
date or share price. The funds may hold proceeds for shares purchased by ACH or
check until the purchase amount has been collected, which may be as long as ten
business days. Also, when the New York Stock Exchange is closed (or when trading
is restricted) for any reason other than its customary weekend or holiday
closing or under any emergency circumstances, as determined by the Securities
and Exchange Commission, we may suspend sales or postpone payment dates.
Generally,
all redemptions will be for cash. However, if during any 90-day period you
redeem shares in an amount greater than the lesser of $250,000 or 1% of a fund’s
net assets, the funds reserve the right to pay part or all of your redemption
proceeds in readily marketable securities instead of cash. Marketable securities
may include illiquid securities. You may experience a delay in converting
illiquid securities to cash. Redemption-in-kind proceeds are limited to
securities that are traded on a public securities market or are limited to
securities for which quoted bid and asked prices are available. They are
distributed to the redeeming shareholder based on a weighted-average pro-rata
basis of a fund's holdings. If payment is made in securities, the fund will
value the securities selected in the same manner in which it computes its NAV.
This process minimizes the effect of large redemptions on a fund and its
remaining shareholders. If you receive securities when
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redeeming
your account, the securities will be subject to market fluctuation and you may
incur tax and transaction costs if the securities are sold.
Accounts
with Low Balances Maintaining
small accounts is costly for the funds and may have a negative effect on
performance. Shareholders are encouraged to keep their accounts above the funds'
minimum.
•
The funds reserve the right to redeem your remaining
shares and close your account if a redemption of shares brings the value of your
account below $2,500. In such cases, you will be notified and given at least
30 days to purchase additional shares to bring the balance above the
minimum before the account is closed.
• The
above involuntary redemptions constitute a sale of fund shares. You should
consult your tax adviser concerning the tax consequences of involuntary
redemptions.
How
to Exchange Shares
You
may exchange any or all of your shares in a fund for shares in another fund or
another share class of the same fund, subject to the following conditions:
Investor
shares of a fund may be exchanged for:
•Investor
shares of another fund
•Another
share class of the same fund provided you meet the eligibility and minimum
investment requirements of that class.
Class
I shares of a fund may be exchanged for:
•Class
I shares of another fund
•Another
share class of the same fund provided you meet the eligibility and minimum
investment requirements of that class.
Class
Y shares of a fund may be exchanged for:
•Class
Y shares of another fund
•Another
share class of the same fund provided you meet the eligibility and minimum
investment requirements of that class.
You
may request the exchange for accounts held directly at the transfer agent by
telephoning 888-226-5595 between the hours of 8:00 a.m. and
6:00 p.m. Eastern time on days the funds are open for business or
writing the funds at Diamond Hill Funds, P.O. Box 46707, Cincinnati, OH 45246.
On days when the NYSE closes early, the call center hours will be reduced
accordingly. You may request the exchange for accounts held through a financial
intermediary by contacting the financial intermediary directly. Exchanges may be
made only if the exchanging fund is registered in your state of residence. The
exchange privilege does not constitute an offering or recommendation of a fund.
Due to operational limitations at your financial intermediary, your ability to
exchange your shares to another share class may be limited. It is your
responsibility to obtain and read a prospectus of the exchanging fund before you
make an exchange. Not all share classes may be available for each fund.
•If
you exchange shares into or out of a fund, the exchange is made at the net asset
value per share of each fund next determined after the exchange request is
received.
In
times of extreme economic or market conditions, exchanging fund shares by
telephone may be difficult. To receive a specific day’s price, your letter or
call must be received before that day’s close of the New York Stock Exchange.
Each exchange represents the sale of shares from one fund and the purchase of
shares
in another, which may produce a gain or loss for federal income tax purposes.
Exchanges
will be accepted only if the registration of the two accounts is identical or
the exchange instructions have a Medallion Signature Guarantee. The funds and
the Transfer Agent are not liable for following instructions communicated by
telephone that they reasonably believe to be genuine. They will use reasonable
procedures to confirm that telephone instructions are genuine. The exchange
feature may be modified or discontinued at any time upon notice to you in
accordance with federal securities laws.
Share
Class Conversions
The Internal Revenue Service currently takes the position that a
conversion/exchange of share classes of the same fund is a nontaxable event.
Conversion/exchanges of share classes between different funds is generally
taxable.
How
to Request Certain Non-Financial Transactions
The
funds will accept the STAMP’s Signature
Validation Program
(SVP) stamp for certain non-financial transactions. The SVP was introduced
in response to requests from financial services institutions that rely upon the
effectiveness of a signature guarantee when processing non-financial
transactions for which the surety bond attached to a Medallion Signature
Guarantee (MSG) would not apply. The SVP stamp carries its own separate
surety bond that would apply to such non-financial transactions. The SVP stamp
may be obtained from eligible members, including banks, broker/dealers, credit
unions, national securities exchanges, registered securities associations,
clearing agencies and savings associations.
This
program enables the funds to accept documents stamped with an SVP stamp in lieu
of the MSG for non-financial transactions. The non-financial transactions
for which the funds can accept an SVP are: (1) change name; (2) add or
change banking instructions; (3) add or change beneficiaries; (4) add
or change authorized account traders; (5) add a Power of Attorney;
(6) add or change Trustee; and (7) change UTMA/UGMA custodian.
In
the event that your bank or financial institution does not participate in the
SVP Stamp program, you should request that the guarantor use their Medallion
Guarantee Stamp.
Market
Timing and Frequent Trading Policy
The
funds are not designed to serve as a vehicle for frequent trading. The funds do
not authorize, and use reasonable methods to discourage, short-term or excessive
trading, often referred to as “market timing.” Market timing is an investment
strategy using frequent purchases, redemptions and/or exchanges in an attempt to
profit from short-term market movements. Market timing or excessive trading may
result in dilution of the value of fund shares held by long-term shareholders,
disrupt portfolio management, and increase fund expenses for all shareholders.
The funds will take reasonable steps to discourage excessive short-term trading
and the funds’ Board of Trustees has adopted the following policies and
procedures with respect to market timing. The funds will monitor selected trades
on a daily basis in an effort to detect excessive short-term trading. If a fund
has reason to believe that a shareholder has engaged in excessive short-term
trading, the fund may ask the shareholder to stop such activities or refuse to
process purchases or exchanges in the shareholder’s accounts. In addition to
rejecting purchase orders in connection with suspected market timing activities,
a fund can reject a purchase
|
| |
DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 47 |
order
for any reason. While the funds cannot assure the prevention of all excessive
trading and market timing, by making these judgments the funds believe they are
acting in a manner that is in the best interests of shareholders.
Market
timers may disrupt portfolio management and harm fund performance. To the extent
that the funds are unable to identify market timers effectively, long-term
investors may be adversely affected. Although the funds use a variety of methods
to detect and deter market timing, due to the complexity involved in identifying
excessive trading there is no assurance that the funds’ efforts will identify
and eliminate all trades or trading practices that may be considered abusive. In
accordance with Rule 22c-2 under the Investment Company Act of 1940, the
Trust has entered into information sharing agreements with certain financial
intermediaries. Under these agreements, a financial intermediary is obligated
to: (1) adopt and enforce during the term of the agreement, a market-timing
policy, the terms of which are acceptable to the Trust; (2) furnish the
Trust, upon its request, with information regarding customer trading activities
in shares of the Trust; and (3) enforce its market-timing policy with
respect to customers identified by the Trust as having engaged in market timing.
When information regarding transactions in the Trust’s shares is requested by
the Trust and such information is in the possession of a person that is itself a
financial intermediary to a financial intermediary (an “indirect intermediary”),
any financial intermediary with whom the Trust has an information sharing
agreement is obligated to obtain transaction information from the indirect
intermediary or, if directed by the Trust, to restrict or prohibit the indirect
intermediary from purchasing shares of the Trust on behalf of other
persons.
The
funds apply these policies and procedures to all shareholders believed to be
engaged in market timing or excessive trading. The funds have no arrangements to
permit any investor to trade frequently in shares of the funds, nor will it
enter into any such arrangements in the future.
Distribution
and Taxes
The
following information is provided to help you understand the income and capital
gains you may earn while you own fund shares, as well as the federal income
taxes you may have to pay. The amount of any distribution varies and there is no
guarantee the funds will pay either income dividends or capital gain
distributions. For tax advice about your personal tax situation, please speak
with your tax adviser.
Income
and Capital Gain Distributions The
funds intend to qualify each year as a regulated investment company under the
Internal Revenue Code. As a regulated investment company, the funds generally
pay no federal income tax on the income and gains distributed to you. The Small
Cap Fund, Small-Mid Cap Fund, Mid Cap Fund, Large Cap Fund, Large Cap
Concentrated Fund, Select Fund, Long-Short Fund and International Fund expect to
declare and distribute their net investment income, if any, to shareholders
annually. The Short Duration Securitized Bond Fund and Core Bond Fund expect to
declare and distribute their net investment income, if any, to shareholders
monthly. Capital gains, if any, may be distributed at least annually. A fund may
distribute income dividends and capital gains more frequently, if necessary, in
order to reduce or eliminate federal excise or income taxes on the fund. All
income and capital gain distributions are automatically reinvested in shares of
the fund unless you request cash distributions on your application or through a
written request. If you choose to have dividends or capital gain distributions,
or both, mailed to you and the distribution check is returned as undeliverable
or is not presented for payment within six months, the Trust reserves the
right
to reinvest the check proceeds and future distributions in shares of the fund at
the fund’s then-current NAV until you give the Trust different instructions.
Tax
Considerations If
you are a taxable investor, dividends and capital gain distributions you receive
from a fund, whether you reinvest your distributions in additional fund shares
or receive them in cash, are subject to federal income tax, state taxes, and
possibly local taxes:
• distributions
are taxable to you at either ordinary income or capital gains tax rates;
• distributions
of short-term capital gains are paid to you as ordinary income that is taxable
at applicable ordinary income tax rates;
• distributions
of long-term capital gains are taxable to you as long-term capital gains no
matter how long you have owned your fund shares;
• for
individuals, a portion of the income dividends paid may be qualified dividend
income eligible for long-term capital gains tax rates, provided that certain
holding period requirements are met;
• for
corporate shareholders, a portion of income dividends may be eligible for the
corporate dividend-received deduction, subject to certain limitations;
• distributions
declared in December to shareholders of record in such month, but paid in
January, are taxable as if they were paid in December; and
• an
additional 3.8% Medicare tax is imposed on distributions you receive from the
funds and gains from selling, redeeming or exchanging your shares.
The
amount and type of income dividends and the tax status of any capital gains
distributed to you are reported on Form 1099-DIV, which we send to you annually
during tax season (unless you hold your shares in a qualified tax-deferred plan
or account or are otherwise not subject to federal income tax). The funds may
reclassify income after your tax reporting statement is mailed to you. This can
result from the rules in the Internal Revenue Code that effectively prevent
mutual funds, such as the funds, from ascertaining with certainty, until after
the calendar year end, the final amount and character of distributions a fund
has received on its investments during the prior calendar year. Prior to issuing
your statement, the funds make every effort to search for reclassified income to
reduce the number of corrected forms mailed to shareholders. However, when
necessary, the funds will send you a corrected Form 1099-DIV to reflect
reclassified information.
Distributions
from the funds (both taxable dividends and capital gains) are normally taxable
to you when made, regardless of whether you reinvest these distributions or
receive them in cash (unless you hold shares in a qualified tax-deferred plan or
account or are otherwise not subject to federal income tax).
If
you are a taxable investor and invest in a fund shortly before it makes a
capital gain distribution, some of your investment may be returned to you in the
form of a taxable distribution. This is commonly known as “buying a dividend.”
Selling
and Exchanging Shares Selling
your shares may result in a realized capital gain or loss, which is subject to
federal income tax. For tax purposes, an exchange from one Diamond Hill Fund to
another is the same as a sale. For individuals, any long-term capital gains you
realize from selling fund shares are taxed at your applicable tax rate for
long-term capital gains. Short-term capital gains are taxed at ordinary
|
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48
DIAMOND HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
income
tax rates. You or your tax adviser should track your purchases, tax basis, sales
and any resulting gain or loss. If you redeem fund shares for a loss, you may be
able to use this capital loss to offset any other capital gains you have.
Other
Tax Jurisdictions Distributions
and gains from the sale or exchange of your fund shares may be subject to state
and local taxes, even if not subject to federal income taxes. State and local
tax laws vary; please consult your tax adviser. Non-U.S. investors may be
subject to U.S. withholding at a 30% or lower treaty tax rate and U.S.
estate tax and are subject to special U.S. tax certification requirements to
avoid backup withholding and claim any treaty benefits.
Tax
Status for Retirement Plans and Other Tax-Deferred Accounts When
you invest in the funds through a qualified employee benefit plan, retirement
plan or some other tax-deferred account, dividend and capital gain distributions
generally are not subject to current federal income taxes. In general, these
plans or accounts are governed by complex tax rules. You should ask your tax
adviser or plan administrator for more information about your tax situation,
including possible state or local taxes.
Backup
Withholding By
law, you may be subject to backup withholding on a portion of your taxable
distributions and redemption proceeds unless you provide your correct Social
Security or taxpayer identification number and certify that (1) this number
is correct, (2) you are not subject to backup withholding, and (3) you
are a U.S. person (including a U.S. resident alien). You may also be
subject to withholding if the Internal Revenue Service instructs us to withhold
a portion of your distributions and proceeds. When withholding is required, the
amount is 24% of any distributions or proceeds paid.
This
discussion of “Distributions and Taxes” is not intended or written to be used as
tax advice. Because everyone’s tax situation is unique, you should consult your
tax professional about federal, state, local or non-U.S. tax consequences before
making an investment in the fund.
Householding
To
reduce expenses, we mail only one copy of the funds’ prospectus and each annual
and semi-annual report to those addresses shared by two or more accounts. If you
wish to receive individual copies of these documents, please call the funds at
888-226-5595 between the hours of 8:00 a.m. and 6:00 p.m. Eastern
time on days the funds are open for business or contact your financial
institution. On days when the NYSE closes early, the call center hours will be
reduced accordingly. We will begin sending you individual copies thirty days
after receiving your request.
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DIAMOND
HILL FUNDS| PROSPECTUS| FEBRUARY 28, 2023| DIAMOND-HILL.COM 49 |
Financial
Highlights
The
financial highlights tables are intended to help you understand the funds’
financial performance for the past five years (or, if shorter, the period
of the funds’ operations). Certain information reflects financial results for a
single fund share. The total returns in the table represent the rate that an
investor would have earned (or lost) on an investment in the funds (assuming
reinvestment of all dividends and distributions). The information has been
audited by Cohen & Company, Ltd., an independent registered public
accounting firm, whose report, along with the funds’ financial statements, are
incorporated by reference in the Statement of Additional Information, which is
available upon request.
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50
DIAMOND
HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
Small
Cap Fund
Financial
Highlights
Selected
data for a share outstanding throughout the periods indicated
|
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|
|
|
|
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|
|
|
|
|
|
|
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|
|
|
|
|
|
|
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|
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|
|
|
|
|
| |
Small
Cap Fund |
Net Asset Value Beginning of Year |
Net
Investment
Income (A) |
| Net Realized and Unrealized Gains (Losses) on Investments |
Total from Investment Operations |
Dividends from Net Investment Income |
| Distributions from Net Realized
Capital Gains |
Total Distributions |
Net Asset Value End
of Year |
Total
Return(B) |
Net Assets
End of Year (000’s) |
Ratio of
Total Net Expenses to Average Net Assets |
Ratio
of Total Gross Expenses to Average Net Assets (C) |
Ratio of Net Investment Income to Average Net Assets |
Portfolio
Turnover
Rate(D) |
|
Investor |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
34.73 |
| 0.11 |
|
| (5.23) |
| (5.12) |
| (0.15) |
|
| (4.40) |
| (4.55) |
| $ |
25.06 |
| (15.02) |
% |
$ |
79,634 |
| 1.26 |
% |
1.26 |
% |
0.34 |
% |
37 |
% |
(E) |
For
the year ended December 31, 2021 |
30.96 |
| 0.07 |
|
| 9.75 |
| 9.82 |
| (0.07) |
|
| (5.98) |
| (6.05) |
| 34.73 |
| 32.45 |
| 123,975 |
| 1.26 |
| 1.26 |
| 0.20 |
| 20 |
| |
For
the year ended December 31, 2020 |
31.23 |
| 0.01 |
|
| (0.18) |
| (0.17) |
| (0.10) |
|
| — |
| (0.10) |
| 30.96 |
| (0.55) |
| 117,491 |
| 1.26 |
| 1.26 |
| 0.05 |
| 34 |
| |
For
the year ended December 31, 2019 |
27.54 |
| 0.06 |
|
| 5.80 |
| 5.86 |
| (0.34) |
|
| (1.83) |
| (2.17) |
| 31.23 |
| 21.36 |
| 165,339 |
| 1.27 |
| 1.27 |
| 0.23 |
| 22 |
| |
For
the year ended December 31, 2018 |
35.62 |
| 0.12 |
|
| (5.37) |
| (5.25) |
| — |
|
| (2.83) |
| (2.83) |
| 27.54 |
| (15.12) |
| 214,831 |
| 1.25 |
| 1.26 |
| 0.31 |
| 23 |
| |
Class
I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
35.44 |
| 0.18 |
|
| (5.31) |
| (5.13) |
| (0.24) |
|
| (4.40) |
| (4.64) |
| $ |
25.67 |
| (14.77) |
% |
$ |
187,656 |
| 0.97 |
% |
0.97 |
% |
0.57 |
% |
37 |
% |
(E) |
For
the year ended December 31, 2021 |
31.49 |
| 0.19 |
|
| 9.92 |
| 10.11 |
| (0.18) |
|
| (5.98) |
| (6.16) |
| 35.44 |
| 32.83 |
| 391,856 |
| 0.97 |
| 0.97 |
| 0.52 |
| 20 |
| |
For
the year ended December 31, 2020 |
31.77 |
| 0.09 |
|
| (0.18) |
| (0.09) |
| (0.19) |
|
| — |
| (0.19) |
| 31.49 |
| (0.28) |
| 350,375 |
| 0.97 |
| 0.97 |
| 0.33 |
| 34 |
| |
For
the year ended December 31, 2019 |
27.98 |
| 0.16 |
|
| 5.90 |
| 6.06 |
| (0.44) |
|
| (1.83) |
| (2.27) |
| 31.77 |
| 21.75 |
| 469,014 |
| 0.98 |
| 0.98 |
| 0.52 |
| 22 |
| |
For
the year ended December 31, 2018 |
36.15 |
| 0.23 |
|
| (5.48) |
| (5.25) |
| (0.09) |
|
| (2.83) |
| (2.92) |
| 27.98 |
| (14.88) |
| 633,323 |
| 0.96 |
| 0.97 |
| 0.64 |
| 23 |
| |
Class
Y |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
35.49 |
| 0.22 |
|
| (5.32) |
| (5.10) |
| (0.27) |
|
| (4.40) |
| (4.67) |
| $ |
25.72 |
| (14.64) |
% |
$ |
18,592 |
| 0.85 |
% |
0.85 |
% |
0.69 |
% |
37 |
% |
(E) |
For
the year ended December 31, 2021 |
31.52 |
| 0.22 |
|
| 9.95 |
| 10.17 |
| (0.22) |
|
| (5.98) |
| (6.20) |
| 35.49 |
| 32.98 |
| 52,704 |
| 0.85 |
| 0.85 |
| 0.59 |
| 20 |
| |
For
the year ended December 31, 2020 |
31.80 |
| 0.12 |
|
| (0.17) |
| (0.05) |
| (0.23) |
|
| — |
| (0.23) |
| 31.52 |
| (0.17) |
| 56,417 |
| 0.85 |
| 0.85 |
| 0.46 |
| 34 |
| |
For
the year ended December 31, 2019 |
28.01 |
| 0.19 |
|
| 5.91 |
| 6.10 |
| (0.48) |
|
| (1.83) |
| (2.31) |
| 31.80 |
| 21.88 |
| 105,030 |
| 0.86 |
| 0.86 |
| 0.62 |
| 22 |
| |
For
the year ended December 31, 2018 |
36.17 |
| 0.27 |
|
| (5.48) |
| (5.21) |
| (0.12) |
|
| (2.83) |
| (2.95) |
| 28.01 |
| (14.79) |
| 147,363 |
| 0.84 |
| 0.85 |
| 0.74 |
| 23 |
| |
(A)
Net investment income per share has been calculated using the average daily
shares outstanding during the period.
(B)
Total
returns shown exclude the effect of applicable sales charges for years prior to
December 31, 2021.
(C) The
Fund’s adviser has contractually agreed to waive fees in the pro-rata amount of
the management fee charged by the underlying Diamond Hill Fund on each Fund’s
investment in such other Diamond Hill Fund. If such fee waiver had not occurred,
the ratios would have been as indicated.
(D)
Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between classes of shares issued.
(E)
Portfolio
turnover does not include redemptions in-kind.
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DIAMOND
HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023| DIAMOND-HILL.COM
51 |
Small-Mid
Cap Fund
Financial
Highlights
Selected
data for a share outstanding throughout the periods indicated
|
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| |
Small-Mid
Cap Fund |
Net Asset Value
Beginning of Year |
Net
Investment
Income (A) |
Net Realized and Unrealized Gains (Losses)
on Investments |
Total
from Investment Operations |
Dividends from
Net Investment Income |
Distributions from
Net Realized Capital Gains |
Total Distributions |
Net Asset Value End
of Year |
Total
Return(B) |
Net Assets
End of Year (000’s) |
Ratio
of Total Net Expenses to Average Net Assets |
Ratio
of Total Gross Expenses to Average Net Assets(C) |
Ratio of Net Investment Income to Average Net Assets |
Portfolio
Turnover
Rate(D) |
|
Investor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
28.06 |
| 0.12 |
| (3.99) |
| (3.87) |
| (0.12) |
| (1.03) |
| (1.15) |
| $ |
23.04 |
| (13.86) |
% |
$ |
163,974 |
| 1.21 |
% |
1.21 |
% |
0.45 |
% |
25 |
% |
(E) |
For
the year ended December 31, 2021 |
22.69 |
| 0.05 |
| 6.87 |
| 6.92 |
| (0.05) |
| (1.50) |
| (1.55) |
| 28.06 |
| 30.78 |
| 208,110 |
| 1.20 |
| 1.21 |
| 0.18 |
| 14 |
| |
For
the year ended December 31, 2020 |
22.57 |
| 0.03 |
| 0.20 |
| 0.23 |
| (0.10) |
| (0.01) |
| (0.11) |
| 22.69 |
| 1.03 |
| 162,637 |
| 1.20 |
| 1.21 |
| 0.19 |
| 31 |
|
(E) |
For
the year ended December 31, 2019 |
18.59 |
| 0.04 |
| 5.02 |
| 5.06 |
| (0.14) |
| (0.94) |
| (1.08) |
| 22.57 |
| 27.33 |
| 183,914 |
| 1.21 |
| 1.22 |
| 0.21 |
| 14 |
| |
For
the year ended December 31, 2018 |
22.24 |
| 0.05 |
| (2.86) |
| (2.81) |
| (0.04) |
| (0.80) |
| (0.84) |
| 18.59 |
| (12.80) |
| 164,037 |
| 1.20 |
| 1.21 |
| 0.21 |
| 26 |
| |
Class
I |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
28.38 |
| 0.19 |
| (4.04) |
| (3.85) |
| (0.19) |
| (1.03) |
| (1.22) |
| $ |
23.31 |
| (13.62) |
% |
$ |
813,600 |
| 0.92 |
% |
0.92 |
% |
0.74 |
% |
25 |
% |
(E) |
For
the year ended December 31, 2021 |
22.93 |
| 0.12 |
| 6.96 |
| 7.08 |
| (0.13) |
| (1.50) |
| (1.63) |
| 28.38 |
| 31.14 |
| 1,059,287 |
| 0.91 |
| 0.92 |
| 0.45 |
| 14 |
| |
For
the year ended December 31, 2020 |
22.80 |
| 0.09 |
| 0.21 |
| 0.30 |
| (0.16) |
| (0.01) |
| (0.17) |
| 22.93 |
| 1.31 |
| 889,148 |
| 0.91 |
| 0.92 |
| 0.49 |
| 31 |
|
(E) |
For
the year ended December 31, 2019 |
18.76 |
| 0.11 |
| 5.08 |
| 5.19 |
| (0.21) |
| (0.94) |
| (1.15) |
| 22.80 |
| 27.74 |
| 1,081,619 |
| 0.92 |
| 0.93 |
| 0.50 |
| 14 |
| |
For
the year ended December 31, 2018 |
22.45 |
| 0.12 |
| (2.91) |
| (2.79) |
| (0.10) |
| (0.80) |
| (0.90) |
| 18.76 |
| (12.56) |
| 889,471 |
| 0.91 |
| 0.92 |
| 0.52 |
| 26 |
| |
Class
Y |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
28.45 |
| 0.23 |
| (4.06) |
| (3.83) |
| (0.22) |
| (1.03) |
| (1.25) |
| $ |
23.37 |
| (13.51) |
% |
$ |
924,744 |
| 0.80 |
% |
0.80 |
% |
0.87 |
% |
25 |
% |
(E) |
For
the year ended December 31, 2021 |
22.99 |
| 0.16 |
| 6.96 |
| 7.12 |
| (0.16) |
| (1.50) |
| (1.66) |
| 28.45 |
| 31.24 |
| 1,011,010 |
| 0.79 |
| 0.80 |
| 0.59 |
| 14 |
| |
For
the year ended December 31, 2020 |
22.84 |
| 0.12 |
| 0.22 |
| 0.34 |
| (0.18) |
| (0.01) |
| (0.19) |
| 22.99 |
| 1.50 |
| 888,375 |
| 0.79 |
| 0.80 |
| 0.61 |
| 31 |
|
(E) |
For
the year ended December 31, 2019 |
18.80 |
| 0.13 |
| 5.08 |
| 5.21 |
| (0.23) |
| (0.94) |
| (1.17) |
| 22.84 |
| 27.82 |
| 1,147,458 |
| 0.80 |
| 0.81 |
| 0.62 |
| 14 |
| |
For
the year ended December 31, 2018 |
22.49 |
| 0.15 |
| (2.91) |
| (2.76) |
| (0.13) |
| (0.80) |
| (0.93) |
| 18.80 |
| (12.42) |
| 924,995 |
| 0.79 |
| 0.80 |
| 0.63 |
| 26 |
| |
(A)
Net investment income per share has been calculated using the average daily
shares outstanding during the period.
(B)
Total
returns shown exclude the effect of applicable sales charges for years prior to
December 31, 2021.
(C)
The
Fund’s adviser has contractually agreed to waive fees in the pro-rata amount of
the management fee charged by the underlying Diamond Hill Fund on each Fund’s
investment in such other Diamond Hill Fund. If such fee waiver had not occurred,
the ratios would have been as indicated.
(D)
Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between classes of shares issued.
(E)
Portfolio
turnover does not include redemptions in-kind.
|
| |
DIAMOND
HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023| DIAMOND-HILL.COM
52 |
Mid
Cap Fund
Financial
Highlights
Selected
data for a share outstanding throughout the periods indicated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Mid
Cap Fund |
Net
Asset Value Beginning of Year |
Net
Investment
Income(A) |
Net Realized and
Unrealized Gains (Losses) on Investments |
Total
from Investment Operations |
Dividends
from Net Investment Income |
Distributions
from Net Realized Capital Gains |
Total
Distributions |
Net asset
Value End of Year |
Total
Return(B) |
Net Assets
End of Year (000’s) |
Ratio of
Total Net Expenses to Average Net Assets |
Ratio
of Total Gross Expenses to Average Net Assets(C) |
Ratio of Net
Investment Income to Average Net Assets |
Portfolio
Turnover Rate(D) |
|
Investor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
18.62 |
| 0.07 |
| (2.60) |
| (2.53) |
| (0.10) |
| (0.66) |
| (0.76) |
| $ |
15.33 |
| (13.66) |
% |
$ |
23,932 |
| 1.06 |
% |
1.06 |
% |
0.46 |
% |
19 |
% |
(E) |
For
the year ended December 31, 2021 |
14.27 |
| 0.05 |
| 4.36 |
| 4.41 |
| (0.06) |
| — |
| (0.06) |
| 18.62 |
| 30.87 |
| 33,006 |
| 1.06 |
| 1.06 |
| 0.30 |
| 12 |
| |
For
the year ended December 31, 2020 |
14.64 |
| 0.05 |
| (0.34) |
| (0.29) |
| (0.06) |
| (0.02) |
| (0.08) |
| 14.27 |
| (2.01) |
| 33,178 |
| 1.06 |
| 1.06 |
| 0.41 |
| 52 |
| |
For
the year ended December 31, 2019 |
11.89 |
| 0.05 |
| 2.96 |
| 3.01 |
| (0.05) |
| (0.21) |
| (0.26) |
| 14.64 |
| 25.36 |
| 31,997 |
| 1.06 |
| 1.07 |
| 0.36 |
| 31 |
| |
For
the year ended December 31, 2018 |
13.66 |
| 0.06 |
| (1.49) |
| (1.43) |
| (0.06) |
| (0.28) |
| (0.34) |
| 11.89 |
| (10.56) |
| 21,085 |
| 1.05 |
| 1.06 |
| 0.43 |
| 20 |
| |
Class
I |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
18.69 |
| 0.12 |
| (2.61) |
| (2.49) |
| (0.15) |
| (0.66) |
| (0.81) |
| $ |
15.39 |
| (13.39) |
% |
$ |
150,772 |
| 0.77 |
% |
0.77 |
% |
0.75 |
% |
19 |
% |
(E) |
For
the year ended December 31, 2021 |
14.32 |
| 0.10 |
| 4.38 |
| 4.48 |
| (0.11) |
| — |
| (0.11) |
| 18.69 |
| 31.29 |
| 229,696 |
| 0.77 |
| 0.77 |
| 0.60 |
| 12 |
| |
For
the year ended December 31, 2020 |
14.69 |
| 0.09 |
| (0.35) |
| (0.26) |
| (0.09) |
| (0.02) |
| (0.11) |
| 14.32 |
| (1.76) |
| 194,354 |
| 0.77 |
| 0.77 |
| 0.71 |
| 52 |
| |
For
the year ended December 31, 2019 |
11.92 |
| 0.10 |
| 2.97 |
| 3.07 |
| (0.09) |
| (0.21) |
| (0.30) |
| 14.69 |
| 25.82 |
| 177,536 |
| 0.77 |
| 0.78 |
| 0.68 |
| 31 |
| |
For
the year ended December 31, 2018 |
13.70 |
| 0.10 |
| (1.50) |
| (1.40) |
| (0.10) |
| (0.28) |
| (0.38) |
| 11.92 |
| (10.31) |
| 55,045 |
| 0.76 |
| 0.77 |
| 0.72 |
| 20 |
| |
Class
Y |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
18.74 |
| 0.14 |
| (2.62) |
| (2.48) |
| (0.17) |
| (0.66) |
| (0.83) |
| $ |
15.43 |
| (13.31) |
% |
$ |
12,528 |
| 0.65 |
% |
0.65 |
% |
0.86 |
% |
19 |
% |
(E) |
For
the year ended December 31, 2021 |
14.36 |
| 0.11 |
| 4.40 |
| 4.51 |
| (0.13) |
| — |
| (0.13) |
| 18.74 |
| 31.41 |
| 23,739 |
| 0.65 |
| 0.65 |
| 0.69 |
| 12 |
| |
For
the year ended December 31, 2020 |
14.73 |
| 0.10 |
| (0.35) |
| (0.25) |
| (0.10) |
| (0.02) |
| (0.12) |
| 14.36 |
| (1.66) |
| 23,248 |
| 0.65 |
| 0.65 |
| 0.82 |
| 52 |
| |
For
the year ended December 31, 2019 |
11.95 |
| 0.11 |
| 2.98 |
| 3.09 |
| (0.10) |
| (0.21) |
| (0.31) |
| 14.73 |
| 25.91 |
| 20,454 |
| 0.65 |
| 0.66 |
| 0.74 |
| 31 |
| |
For
the year ended December 31, 2018 |
13.73 |
| 0.12 |
| (1.50) |
| (1.38) |
| (0.12) |
| (0.28) |
| (0.40) |
| 11.95 |
| (10.17) |
| 27,761 |
| 0.64 |
| 0.65 |
| 0.83 |
| 20 |
| |
(A)
Net investment income per share has been calculated using the average daily
shares outstanding during the period.
(B)
Total returns shown exclude the effect of applicable sales charges for years
prior to December 31, 2021.
(C)
The
Fund’s adviser has contractually agreed to waive fees in the pro-rata amount of
the management fee charged by the underlying Diamond Hill Fund on each Fund’s
investment in such other Diamond Hill Fund. If such fee waiver had not occurred,
the ratios would have been as indicated.
(D)
Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between classes of shares issued.
(E)
Portfolio turnover does not include redemptions in-kind.
|
| |
53
DIAMOND
HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
Large
Cap Fund
Financial
Highlights
Selected
data for a share outstanding throughout the periods indicated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Large
Cap Fund |
Net Asset Value Beginning of Year |
Net
Investment
Income(A) |
Net Realized and Unrealized Gains (Losses) on Investments |
Total from Investment Operations |
Dividends from
Net Investment Income |
Distributions from Net Realized Capital
Gains |
Total Distributions |
Net asset Value End of Year |
Total
Return(B) |
Net Assets
End of Year (000,000’s) |
Ratio of
Total Expenses to Average Net Assets |
Ratio of Net Investment Income
to Average Net Assets |
Portfolio
Turnover
Rate(C) |
|
Investor |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
35.50 |
| 0.28 |
| (5.09) |
| (4.81) |
| (0.33) |
| (1.50) |
| (1.83) |
| $ |
28.86 |
| (13.66) |
% |
$ |
777 |
| 0.96 |
% |
0.87 |
% |
38 |
% |
(D) |
For
the year ended December 31, 2021 |
30.42 |
| 0.23 |
| 7.43 |
| 7.66 |
| (0.21) |
| (2.37) |
| (2.58) |
| 35.50 |
| 25.42 |
| 987 |
| 0.96 |
| 0.68 |
| 22 |
|
(D) |
For
the year ended December 31, 2020 |
28.86 |
| 0.28 |
| 2.19 |
| 2.47 |
| (0.18) |
| (0.73) |
| (0.91) |
| 30.42 |
| 8.65 |
| 763 |
| 0.96 |
| 1.04 |
| 33 |
| |
For
the year ended December 31, 2019 |
22.89 |
| 0.28 |
| 6.99 |
| 7.27 |
| (0.26) |
| (1.04) |
| (1.30) |
| 28.86 |
| 31.80 |
| 1,243 |
| 0.97 |
| 1.03 |
| 22 |
|
(E) |
For
the year ended December 31, 2018 |
26.45 |
| 0.25 |
| (2.83) |
| (2.58) |
| (0.26) |
| (0.72) |
| (0.98) |
| 22.89 |
| (9.88) |
| 1,031 |
| 0.96 |
| 0.95 |
| 29 |
|
(D) |
Class
I |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
35.69 |
| 0.37 |
| (5.10) |
| (4.73) |
| (0.42) |
| (1.50) |
| (1.92) |
| $ |
29.04 |
| (13.38) |
% |
$ |
5,417 |
| 0.67 |
% |
1.16 |
% |
38 |
% |
(D) |
For
the year ended December 31, 2021 |
30.57 |
| 0.34 |
| 7.46 |
| 7.80 |
| (0.31) |
| (2.37) |
| (2.68) |
| 35.69 |
| 25.75 |
| 8,168 |
| 0.67 |
| 0.97 |
| 22 |
|
(D) |
For
the year ended December 31, 2020 |
29.05 |
| 0.36 |
| 2.22 |
| 2.58 |
| (0.33) |
| (0.73) |
| (1.06) |
| 30.57 |
| 8.97 |
| 5,140 |
| 0.67 |
| 1.33 |
| 33 |
| |
For
the year ended December 31, 2019 |
23.03 |
| 0.36 |
| 7.04 |
| 7.40 |
| (0.34) |
| (1.04) |
| (1.38) |
| 29.05 |
| 32.18 |
| 3,878 |
| 0.68 |
| 1.32 |
| 22 |
|
(E) |
For
the year ended December 31, 2018 |
26.62 |
| 0.33 |
| (2.86) |
| (2.53) |
| (0.34) |
| (0.72) |
| (1.06) |
| 23.03 |
| (9.63) |
| 2,978 |
| 0.67 |
| 1.23 |
| 29 |
|
(D) |
Class
Y |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
35.72 |
| 0.41 |
| (5.10) |
| (4.69) |
| (0.47) |
| (1.50) |
| (1.97) |
| $ |
29.06 |
| (13.27) |
% |
$ |
2,296 |
| 0.55 |
% |
1.28 |
% |
38 |
% |
(D) |
For
the year ended December 31, 2021 |
30.59 |
| 0.38 |
| 7.47 |
| 7.85 |
| (0.35) |
| (2.37) |
| (2.72) |
| 35.72 |
| 25.89 |
| 3,205 |
| 0.55 |
| 1.09 |
| 22 |
|
(D) |
For
the year ended December 31, 2020 |
29.07 |
| 0.40 |
| 2.21 |
| 2.61 |
| (0.36) |
| (0.73) |
| (1.09) |
| 30.59 |
| 9.07 |
| 2,340 |
| 0.55 |
| 1.45 |
| 33 |
| |
For
the year ended December 31, 2019 |
23.04 |
| 0.40 |
| 7.05 |
| 7.45 |
| (0.38) |
| (1.04) |
| (1.42) |
| 29.07 |
| 32.34 |
| 1,568 |
| 0.56 |
| 1.44 |
| 22 |
|
(E) |
For
the year ended December 31, 2018 |
26.64 |
| 0.36 |
| (2.87) |
| (2.51) |
| (0.37) |
| (0.72) |
| (1.09) |
| 23.04 |
| (9.53) |
| 992 |
| 0.55 |
| 1.35 |
| 29 |
|
(D) |
(A)
Net investment income per share has been calculated using the average daily
shares outstanding during the period.
(B)
Total returns shown exclude the effect of applicable sales charges for years
prior to December 31, 2021.
(C)
Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between classes of shares issued.
(D)
Portfolio turnover does not include redemptions in-kind.
(E)
Portfolio turnover does not include in-kind subscriptions.
|
| |
DIAMOND
HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023| DIAMOND-HILL.COM
54 |
Large
Cap Concentrated Fund
Financial
Highlights
Selected
data for a share outstanding throughout the periods indicated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Large
Cap Concentrated Fund (A) |
Net
Asset Value Beginning of Period |
Net
Investment Income(B) |
Net Realized and
Unrealized Gains (Losses) on Investments |
Total from
Investment Operations |
Dividends
from Net Investment Income |
Distributions
from Net Realized Capital Gains |
Total
Distributions |
Net Asset
Value End of Period |
Total
Return |
| Net Assets
End of Period (000’s) |
Ratio
of Total Expenses to Average
Net Assets |
| Ratio of Net
Investment Income to Average Net
Assets |
|
Portfolio
Turnover Rate(C) |
|
Investor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
11.90 |
| 0.10 |
| (1.64) |
| (1.54) |
| (0.03) |
| — |
| (0.03) |
| $ |
10.33 |
| (12.93) |
% |
| $ |
23 |
| 0.97 |
% |
| 0.96 |
% |
| 41 |
% |
|
For
the period ended December 31, 2021 |
10.00 |
| 0.05 |
| 2.00 |
| 2.05 |
| (0.05) |
| (0.10) |
| (0.15) |
| 11.90 |
| 20.53 |
|
(D) |
33 |
| 0.96 |
|
(E) |
0.56 |
|
(E) |
18 |
|
(D) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Class
I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
11.92 |
| 0.14 |
(1.66) |
| (1.52) |
| (0.12) |
| — |
| (0.12) |
| $ |
10.28 |
| (12.75) |
% |
| $ |
9,107 |
| 0.68 |
% |
| 1.38 |
% |
| 41 |
% |
|
For
the period ended December 31, 2021 |
10.00 |
| 0.07 |
2.02 |
| 2.09 |
| (0.07) |
| (0.10) |
| (0.17) |
| 11.92 |
| 20.92 |
|
(D) |
2,015 |
| 0.67 |
|
(E) |
0.77 |
|
(E) |
18 |
|
(D) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Class
Y |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
11.92 |
| 0.14 |
(1.64) |
| (1.50) |
| (0.13) |
| — |
| (0.13) |
| $ |
10.29 |
| (12.62) |
% |
| $ |
14,017 |
| 0.56 |
% |
| 1.32 |
% |
| 41 |
% |
|
For
the period ended December 31, 2021 |
10.00 |
0.09 |
| 2.01 |
| 2.10 |
| (0.08) |
| (0.10) |
| (0.18) |
| 11.92 |
| 20.98 |
|
(D) |
15,898 |
| 0.55 |
|
(E) |
1.00 |
|
(E) |
18 |
|
(D) |
(A)
Inception date of the Fund is February 26, 2021. Fund commenced public offering
on May 3, 2021.
(B)
Net investment income per share has been calculated using the average daily
shares outstanding during the period.
(C)
Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between classes of shares issued.
(D)
Not annualized.
(E)
Annualized.
|
| |
DIAMOND
HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023| DIAMOND-HILL.COM
55 |
Select
Fund
Financial
Highlights
Selected
data for a share outstanding throughout the periods indicated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Select
Fund |
Net
Asset Value Beginning of Year |
Net
Investment Income (loss)(A) |
Net Realized and
Unrealized Gains (Losses) on Investments |
Total
from Investment Operations |
Dividends
from Net Investment Income |
Distributions
from Net Realized Capital Gains |
Total
Distributions |
Net Asset
Value End of Year |
Total
Return(B) |
Net Assets
End of Year (000’s) |
Ratio of
Total Expenses to Average Net Assets |
Ratio of Net
Investment Income (Loss) to Average
Net Assets |
Portfolio
Turnover RateC) |
|
Investor |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
21.44 |
| (0.02) |
| (3.70) |
| (3.72) |
| — |
| (0.69) |
| (0.69) |
| $ |
17.03 |
| (17.44) |
% |
$ |
28,808 |
| 1.16 |
% |
(0.09) |
% |
78 |
% |
(D) |
For
the year ended December 31, 2021 |
18.43 |
| 0.10 |
| 5.85 |
5.95 |
| (0.17) |
| (2.77) |
| (2.94) |
| 21.44 |
| 32.91 |
| 31,064 |
| 1.16 |
| 0.44 |
| 55 |
| |
For
the year ended December 31, 2020 |
16.17 |
| 0.05 |
| 2.26 |
2.31 |
| (0.05) |
| — |
| (0.05) |
| 18.43 |
| 14.30 |
| 10,207 |
| 1.16 |
| 0.33 |
| 76 |
| |
For
the year ended December 31, 2019 |
12.64 |
| 0.06 |
| 3.78 |
| 3.84 |
| — |
| (0.31) |
| (0.31) |
| 16.17 |
| 30.41 |
| 11,049 |
| 1.17 |
| 0.46 |
| 45 |
| |
For
the year ended December 31, 2018 |
16.01 |
| 0.05 |
| (1.96) |
| (1.91) |
| (0.06) |
| (1.40) |
| (1.46) |
| 12.64 |
| (12.31) |
| 8,963 |
| 1.16 |
| 0.29 |
| 84 |
| |
Class
I |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
21.73 |
| 0.04 |
| (3.76) |
| (3.72) |
| (0.04) |
| (0.69) |
| (0.73) |
| $ |
17.28 |
| (17.20) |
% |
$ |
238,051 |
| 0.87 |
% |
0.21 |
% |
78 |
% |
(D) |
For
the year ended December 31, 2021 |
18.60 |
| 0.14 |
| 5.96 |
| 6.10 |
| (0.20) |
| (2.77) |
| (2.97) |
| 21.73 |
| 33.39 |
| 232,051 |
| 0.87 |
| 0.61 |
| 55 |
| |
For
the year ended December 31, 2020 |
16.32 |
| 0.09 |
| 2.29 |
| 2.38 |
| (0.10) |
| — |
| (0.10) |
| 18.60 |
| 14.57 |
| 171,263 |
| 0.87 |
| 0.62 |
| 76 |
| |
For
the year ended December 31, 2019 |
12.72 |
| 0.11 |
| 3.80 |
| 3.91 |
| — |
| (0.31) |
| (0.31) |
| 16.32 |
| 30.77 |
| 152,591 |
| 0.88 |
| 0.75 |
| 45 |
| |
For
the year ended December 31, 2018 |
16.11 |
| 0.10 |
| (1.97) |
| (1.87) |
| (0.12) |
| (1.40) |
| (1.52) |
| 12.72 |
| (12.02) |
| 114,571 |
| 0.87 |
| 0.60 |
| 84 |
| |
Class
Y |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
21.82 |
| 0.05 |
| (3.76) |
| (3.71) |
| (0.06) |
| (0.69) |
| (0.75) |
| $ |
17.36 |
| (17.10) |
% |
$ |
57,091 |
| 0.75 |
% |
0.27 |
% |
78 |
% |
(D) |
For
the year ended December 31, 2021 |
18.66 |
| 0.14 |
| 6.01 |
| 6.15 |
| (0.22) |
| (2.77) |
| (2.99) |
| 21.82 |
| 33.55 |
| 120,283 |
| 0.75 |
| 0.64 |
| 55 |
| |
For
the year ended December 31, 2020 |
16.37 |
| 0.11 |
| 2.30 |
| 2.41 |
| (0.12) |
| — |
| (0.12) |
| 18.66 |
| 14.70 |
| 141,244 |
| 0.75 |
| 0.74 |
| 76 |
| |
For
the year ended December 31, 2019 |
12.74 |
| 0.13 |
| 3.81 |
| 3.94 |
| — |
| (0.31) |
| (0.31) |
| 16.37 |
| 30.96 |
| 103,963 |
| 0.76 |
| 0.86 |
| 45 |
| |
For
the year ended December 31, 2018 |
16.14 |
| 0.12 |
| (1.99) |
| (1.87) |
| (0.13) |
| (1.40) |
| (1.53) |
| 12.74 |
| (11.95) |
| 65,218 |
| 0.75 |
| 0.73 |
| 84 |
| |
(A)
Net Investment income (loss) per share has been calculated using the average
daily shares outstanding during the period.
(B)
Total returns shown exclude the effect of applicable sales charges for years
prior to December 31, 2021.
(C)
Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between classes of shares issued.
(D)
Portfolio turnover does not include redemptions in-kind.
|
| |
56
DIAMOND
HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
Long-Short
Fund
Financial
Highlights
Selected
data for a share outstanding throughout the periods indicated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Long-Short
Fund |
Net
Asset Value Beginning of Year |
Net
Investment Income (Loss)(A) |
Net Realized and
Unrealized Gains (Losses) on Investments |
Total
from Investment Operations |
Dividends
from Net Investment Income |
Distributions
from Net Realized Capital Gains |
Total
Distributions |
Net Asset
Value End of Year |
Total
Return(B) |
Net
Assets End of Year (000,000’s) |
Ratio of
Total Net Expenses to Average Net Assets(C) |
Ratio of
Total Gross Expenses to Average Net Assets(D) |
Ratio of Net
Investment Income (Loss) to Average
Net Assets |
Portfolio
Turnover Rate(E)(F) |
Investor
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
27.76 |
| 0.08 |
| (2.50) |
| (2.42) |
| (0.09) |
| (1.13) |
| (1.22) |
| $ |
24.12 |
| (8.74) |
% |
$ |
127 |
| 1.78 |
% |
1.78 |
% |
0.30 |
% |
61 |
% |
For
the year ended December 31, 2021 |
25.89 |
| (0.11) |
| 4.98 |
| 4.87 |
| — |
| (3.00) |
| (3.00) |
| 27.76 |
| 19.03 |
| 168 |
| 1.92 |
| 1.93 |
| (0.38) |
| 33 |
|
For
the year ended December 31, 2020 |
26.29 |
| 0.02 |
| (0.17) |
| (0.15) |
| (0.05) |
| (0.20) |
| (0.25) |
| 25.89 |
| (0.55) |
| 162 |
| 1.81 |
| 1.82 |
| 0.09 |
| 65 |
|
For
the year ended December 31, 2019 |
22.78 |
| 0.13 |
| 5.04 |
| 5.17 |
| (0.17) |
| (1.49) |
| (1.66) |
| 26.29 |
| 22.74 |
| 235 |
| 1.85 |
| 1.86 |
| 0.51 |
| 54 |
|
For
the year ended December 31, 2018 |
25.76 |
| 0.10 |
| (1.96) |
| (1.86) |
| (0.07) |
| (1.05) |
| (1.12) |
| 22.78 |
| (7.30) |
| 189 |
| 1.72 |
| 1.73 |
| 0.38 |
| 64 |
|
Class
I |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
28.68 |
| 0.17 |
| (2.59) |
| (2.42) |
| (0.17) |
| (1.13) |
| (1.30) |
| $ |
24.96 |
| (8.45) |
% |
$ |
1,604 |
| 1.49 |
% |
1.49 |
% |
0.61 |
% |
61 |
% |
For
the year ended December 31, 2021 |
26.58 |
| (0.03) |
| 5.13 |
| 5.10 |
| — |
| (3.00) |
| (3.00) |
| 28.68 |
| 19.40 |
| 1,792 |
| 1.63 |
| 1.64 |
| (0.08) |
| 33 |
|
For
the year ended December 31, 2020 |
26.98 |
| 0.09 |
| (0.17) |
| (0.08) |
| (0.12) |
| (0.20) |
| (0.32) |
| 26.58 |
| (0.27) |
| 1,794 |
| 1.52 |
| 1.53 |
| 0.39 |
| 65 |
|
For
the year ended December 31, 2019 |
23.32 |
| 0.22 |
| 5.16 |
| 5.38 |
| (0.23) |
| (1.49) |
| (1.72) |
| 26.98 |
| 23.11 |
| 2,960 |
| 1.56 |
| 1.57 |
| 0.84 |
| 54 |
|
For
the year ended December 31, 2018 |
26.39 |
| 0.18 |
| (2.01) |
| (1.83) |
| (0.19) |
| (1.05) |
| (1.24) |
| 23.32 |
| (7.04) |
| 3,111 |
| 1.43 |
| 1.44 |
| 0.68 |
| 64 |
|
Class
Y |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
28.85 |
| 0.19 |
| (2.60) |
| (2.41) |
| (0.20) |
| (1.13) |
| (1.33) |
| $ |
25.11 |
| (8.36) |
% |
$ |
22 |
| 1.37 |
% |
1.37 |
% |
0.68 |
% |
61 |
% |
For
the year ended December 31, 2021 |
26.69 |
| 0.02 |
| 5.14 |
| 5.16 |
| — |
| (3.00) |
| (3.00) |
| 28.85 |
| 19.55 |
| 37 |
| 1.51 |
| 1.52 |
| 0.08 |
| 33 |
|
For
the year ended December 31, 2020 |
27.10 |
| 0.14 |
| (0.20) |
| (0.06) |
| (0.15) |
| (0.20) |
| (0.35) |
| 26.69 |
| (0.19) |
| 75 |
| 1.40 |
| 1.41 |
| 0.57 |
| 65 |
|
For
the year ended December 31, 2019 |
23.42 |
| 0.25 |
| 5.18 |
| 5.43 |
| (0.26) |
| (1.49) |
| (1.75) |
| 27.10 |
| 23.23 |
| 292 |
| 1.44 |
| 1.45 |
| 0.93 |
| 54 |
|
For
the year ended December 31, 2018 |
26.49 |
| 0.21 |
| (2.01) |
| (1.80) |
| (0.22) |
| (1.05) |
| (1.27) |
| 23.42 |
| (6.89) |
| 214 |
| 1.31 |
| 1.32 |
| 0.80 |
| 64 |
|
(A)
Net investment income (loss) per share has been calculated using the average
daily shares outstanding during the period.
(B)
Total returns shown exclude the effect of applicable sales charges for years
prior to December 31, 2021.
(C)
This Fund invests in short positions and as such incurs certain expenses and
fees. If such expenses and fees had not occurred, the ratios of total expenses
to average net assets would have been 1.36% for Investor, 1.07% for Class I, and
0.95% for Class Y.
(D)
The
Fund’s adviser has contractually agreed to waive fees in the pro-rata amount of
the management fee charged by the underlying Diamond Hill Fund on each Fund’s
investment in such other Diamond Hill Fund. If such fee waiver had not occurred,
the ratios would have been as indicated.
(E)
Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between classes of shares issued.
(F)
The
portfolio turnover rate for 2022, 2021, 2020, 2019, and 2018 would have been
46%, 30%, 47%, 42%, and 51%, respectively, if the absolute value of securities
sold short liability was included in the denominator of the calculation.
|
| |
DIAMOND
HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023 | DIAMOND-HILL.COM
57 |
International
Fund
Financial
Highlights
Selected
data for a share outstanding throughout the periods indicated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
International
Fund(A) |
Net
Asset Value Beginning of Period |
Net
Investment Income (B) |
Net Realized and
Unrealized Gains (Losses) on Investments |
Total from
Investment Operations |
Dividends
from Net Investment Income |
Distributions
from Net Realized Capital Gains |
Total
Distributions |
Net Asset
Value End of Period |
Total
Return(C) |
| Net Assets
End of Period (000’s) |
Ratio
of Total Expenses to Average
Net Assets |
| Ratio of Net
Investment Income to Average Net
Assets |
|
Portfolio
Turnover Rate(D) |
|
Investor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
16.76 |
| 0.17 |
| (2.49) |
| (2.32) |
| (0.12) |
| (0.04) |
| (0.16) |
| $ |
14.28 |
| (13.84) |
% |
| $ |
267 |
| 1.15 |
% |
| 1.13 |
% |
| 21 |
% |
|
For
the year ended December 31, 2021 |
15.48 |
| 0.38 |
| 1.52 |
| 1.90 |
| (0.15) |
| (0.47) |
| (0.62) |
| 16.76 |
| 12.43 |
|
| 449 |
| 1.13 |
|
| 2.20 |
|
| 33 |
| |
For
the year ended December 31, 2020 |
14.67 |
| 0.05 |
| 0.90 |
| 0.95 |
| (0.06) |
| (0.08) |
| (0.14) |
| 15.48 |
| 6.48 |
|
| 338 |
| 1.14 |
|
| 0.43 |
|
| 49 |
| |
For
the period ended December 31, 2019 |
13.55 |
| 0.02 |
| 1.15 |
| 1.17 |
| (0.04) |
| (0.01) |
| (0.05) |
| 14.67 |
| 8.64 |
|
(E) |
45 |
| 1.21 |
|
(F) |
0.25 |
|
(F) |
8 |
|
(E) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Class
I |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
16.79 |
| 0.20 |
| (2.46) |
| (2.26) |
| (0.20) |
| (0.04) |
| (0.24) |
| $ |
14.29 |
| (13.51) |
% |
| $ |
10,729 |
| 0.86 |
% |
| 1.35 |
% |
| 21 |
% |
|
For
the year ended December 31, 2021 |
15.51 |
| 0.42 |
| 1.53 |
| 1.95 |
| (0.20) |
| (0.47) |
| (0.67) |
| 16.79 |
| 12.74 |
|
| 9,010 |
| 0.84 |
|
| 2.43 |
|
| 33 |
| |
For
the year ended December 31, 2020 |
14.69 |
| 0.09 |
| 0.90 |
| 0.99 |
| (0.09) |
| (0.08) |
| (0.17) |
| 15.51 |
| 6.74 |
|
| 3,913 |
| 0.85 |
|
| 0.74 |
|
| 49 |
| |
For
the period ended December 31, 2019 |
13.55 |
| 0.04 |
| 1.15 |
| 1.19 |
| (0.04) |
| (0.01) |
| (0.05) |
| 14.69 |
| 8.80 |
|
(E) |
3,828 |
| 0.92 |
|
(F) |
0.61 |
|
(F) |
8 |
|
(E) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Class
Y |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
16.80 |
| 0.22 |
| (2.47) |
| (2.25) |
| (0.21) |
| (0.04) |
| (0.25) |
| $ |
14.30 |
| (13.41) |
% |
| $ |
40,603 |
| 0.74 |
% |
| 1.48 |
% |
| 21 |
% |
|
For
the year ended December 31, 2021 |
15.51 |
| 0.47 |
| 1.51 |
| 1.98 |
| (0.22) |
| (0.47) |
| (0.69) |
| 16.80 |
| 12.88 |
|
| 46,129 |
| 0.72 |
|
| 2.74 |
|
| 33 |
| |
For
the year ended December 31, 2020 |
14.69 |
| 0.11 |
| 0.89 |
| 1.00 |
| (0.10) |
| (0.08) |
| (0.18) |
| 15.51 |
| 6.81 |
|
| 12,616 |
| 0.73 |
|
| 0.87 |
|
| 49 |
| |
For
the period ended December 31, 2019 |
13.55 |
| 0.05 |
| 1.15 |
| 1.20 |
| (0.05) |
| (0.01) |
| (0.06) |
| 14.69 |
| 8.85 |
|
(E) |
9,616 |
| 0.80 |
|
(F) |
0.70 |
|
(F) |
8 |
|
(E) |
(A)
Inception date of the Fund is June 28, 2019. The Fund commended public offering
and operations on July 1, 2019.
(B)
Net investment income per share has been calculated using the average daily
shares outstanding during the period.
(C)
Total returns shown exclude the effect of applicable sales charges for periods
prior to December 31, 2021.
(D)
Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between classes of shares issued.
(E)
Not annualized.
(F)
Annualized.
|
| |
DIAMOND
HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023 | DIAMOND-HILL.COM
58 |
Short
Duration Securitized Bond Fund
Financial
Highlights
Selected
data for a share outstanding throughout the periods indicated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Short
Duration Securitized Bond Fund |
Net
Asset Value Beginning of Year |
Net
Investment Income(A) |
Net Realized and
Unrealized Gains (Losses) on Investments |
Total from
Investment Operations |
Dividends
from Net Investment Income |
Distributions
from Net Realized Capital Gains |
| Total
Distributions |
Net Asset
Value End of Year |
Total
Return(B) |
Net Assets End of Year
(000’s) |
Ratio
of Total Expenses to Average
Net Assets |
Ratio of Net
Investment Income to Average Net
Assets |
Portfolio
Turnover Rate(C) |
Investor
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
10.10 |
| 0.31 |
| (0.67) |
| (0.36) |
| (0.32) |
| — |
|
| (0.32) |
| $ |
9.42 |
| (3.57) |
% |
$ |
29,352 |
| 0.81 |
% |
3.23 |
% |
41 |
% |
For
the year ended December 31, 2021 |
10.09 |
| 0.23 |
| 0.01 |
| 0.24 |
| (0.23) |
| (0.00) |
|
(D) |
(0.23) |
| 10.10 |
| 2.42 |
| 40,035 |
| 0.81 |
| 2.26 |
| 48 |
|
For
the year ended December 31, 2020 |
10.11 |
| 0.26 |
| 0.02 |
| 0.28 |
| (0.30) |
| — |
|
| (0.30) |
| 10.09 |
| 2.87 |
| 47,059 |
| 0.82 |
| 2.68 |
| 72 |
|
For
the year ended December 31, 2019 |
10.05 |
| 0.38 |
| 0.06 |
| 0.44 |
| (0.38) |
| (0.00) |
|
(D) |
(0.38) |
| 10.11 |
| 4.44 |
| 55,727 |
| 0.82 |
| 3.72 |
| 54 |
|
For
the year ended December 31, 2018 |
10.11 |
| 0.33 |
| (0.04) |
| 0.29 |
| (0.34) |
| (0.01) |
|
| (0.35) |
| 10.05 |
| 2.88 |
| 18,789 |
| 0.81 |
| 3.30 |
| 67 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Class
I |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
10.10 |
| 0.34 |
| (0.68) |
| (0.34) |
| (0.35) |
| — |
|
| (0.35) |
| $ |
9.41 |
| (3.38) |
% |
$ |
1,054,124 |
| 0.52 |
% |
3.55 |
% |
41 |
% |
For
the year ended December 31, 2021 |
10.09 |
| 0.25 |
| 0.02 |
| 0.27 |
| (0.26) |
| (0.00) |
|
(D) |
(0.26) |
| 10.10 |
| 2.74 |
| 1,313,888 |
| 0.52 |
| 2.50 |
| 48 |
|
For
the year ended December 31, 2020 |
10.12 |
| 0.28 |
| 0.02 |
| 0.30 |
| (0.33) |
| — |
|
| (0.33) |
| 10.09 |
| 3.08 |
| 897,232 |
| 0.53 |
| 2.93 |
| 72 |
|
For
the year ended December 31, 2019 |
10.05 |
| 0.41 |
| 0.07 |
| 0.48 |
| (0.41) |
| (0.00) |
|
(D) |
(0.41) |
| 10.12 |
| 4.85 |
| 525,994 |
| 0.53 |
| 4.00 |
| 54 |
|
For
the year ended December 31, 2018 |
10.11 |
| 0.36 |
| (0.04) |
| 0.32 |
| (0.37) |
| (0.01) |
|
| (0.38) |
| 10.05 |
| 3.18 |
| 308,341 |
| 0.52 |
| 3.62 |
| 67 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Class
Y |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
$ |
10.11 |
| 0.34 |
| (0.67) |
| (0.33) |
| (0.36) |
| — |
|
| (0.36) |
| $ |
9.42 |
| (3.27) |
% |
$ |
64,761 |
| 0.40 |
% |
3.54 |
% |
41 |
% |
For
the year ended December 31, 2021 |
10.10 |
| 0.27 |
| 0.01 |
| 0.28 |
| (0.27) |
| (0.00) |
|
(D) |
(0.27) |
| 10.11 |
| 2.85 |
| 144,787 |
| 0.40 |
| 2.68 |
| 48 |
|
For
the year ended December 31, 2020 |
10.12 |
| 0.30 |
| 0.02 |
| 0.32 |
| (0.34) |
| — |
|
| (0.34) |
| 10.10 |
| 3.29 |
| 188,175 |
| 0.41 |
| 3.09 |
| 72 |
|
For
the year ended December 31, 2019 |
10.06 |
| 0.42 |
| 0.06 |
| 0.48 |
| (0.42) |
| (0.00) |
|
(D) |
(0.42) |
| 10.12 |
| 4.84 |
| 226,938 |
| 0.41 |
| 4.09 |
| 54 |
|
For
the year ended December 31, 2018 |
10.11 |
| 0.38 |
| (0.04) |
| 0.34 |
| (0.38) |
| (0.01) |
|
| (0.39) |
| 10.06 |
| 3.38 |
| 252,137 |
| 0.40 |
| 3.72 |
| 67 |
|
(A)
Net
investment income per share has been calculated using the average daily shares
outstanding during the period.
(B)
Total returns shown exclude the effect of applicable sales charges for years
prior to December 31, 2021.
(C)
Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between classes of shares issued.
(D)
Amount is less than $0.005.
|
| |
59
DIAMOND
HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023|
DIAMOND-HILL.COM |
Core
Bond Fund
Financial
Highlights
Selected
data for a share outstanding throughout the periods indicated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Core
Bond Fund |
| Net
Asset Value Beginning of Year |
Net
Investment Income(A) |
Net Realized and
Unrealized Gains (Losses) on Investments |
Total from
Investment Operations |
Dividends
from Net Investment Income |
Distributions
from Net Realized Capital Gains |
Total
Distributions |
Net Asset
Value End of Year |
Total
Return(B) |
Net Assets at
End of Year (000’s) |
Ratio
of Total Expenses to Average
Net Assets |
Ratio of Net
Investment Income to Average Net
Assets |
Portfolio
Turnover Rate(C) |
Investor
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
| $ |
10.40 |
| 0.22 |
| (1.46) |
| (1.24) |
| (0.24) |
| — |
| (0.24) |
| $ |
8.92 |
| (12.05) |
% |
$ |
3,572 |
| 0.76 |
% |
2.36 |
% |
40 |
% |
For
the year ended December 31, 2021 |
| 10.74 |
| 0.19 |
| (0.32) |
| (0.13) |
| (0.21) |
| — |
| (0.21) |
| 10.40 |
| (1.24) |
| 10,091 |
| 0.76 |
| 1.78 |
| 37 |
|
For
the year ended December 31, 2020 |
| 10.19 |
| 0.21 |
| 0.56 |
| 0.77 |
| (0.22) |
| — |
| (0.22) |
| 10.74 |
| 7.60 |
| 17,024 |
| 0.76 |
| 1.98 |
| 28 |
|
For
the year ended December 31, 2019 |
| 9.71 |
| 0.24 |
| 0.49 |
| 0.73 |
| (0.25) |
| — |
| (0.25) |
| 10.19 |
| 7.63 |
| 3,599 |
| 0.77 |
| 2.43 |
| 29 |
|
For
the year ended December 31, 2018 |
| 9.85 |
| 0.25 |
| (0.13) |
| 0.12 |
| (0.26) |
| — |
| (0.26) |
| 9.71 |
| 1.28 |
| 2,976 |
| 0.76 |
| 2.60 |
| 25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Class
I |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
| $ |
10.39 |
| 0.27 |
| (1.49) |
| (1.22) |
| (0.27) |
| — |
| (0.27) |
| $ |
8.90 |
| (11.84) |
% |
$ |
526,372 |
| 0.47 |
% |
2.93 |
% |
40 |
% |
For
the year ended December 31, 2021 |
| 10.74 |
| 0.22 |
| (0.33) |
| (0.11) |
| (0.24) |
| — |
| (0.24) |
| 10.39 |
| (0.99) |
| 330,666 |
| 0.47 |
| 2.08 |
| 37 |
|
For
the year ended December 31, 2020 |
| 10.19 |
| 0.24 |
| 0.56 |
| 0.80 |
| (0.25) |
| — |
| (0.25) |
| 10.74 |
| 7.94 |
| 260,365 |
| 0.47 |
| 2.28 |
| 28 |
|
For
the year ended December 31, 2019 |
| 9.71 |
| 0.26 |
| 0.50 |
| 0.76 |
| (0.28) |
| — |
| (0.28) |
| 10.19 |
| 7.93 |
| 66,174 |
| 0.48 |
| 2.61 |
| 29 |
|
For
the year ended December 31, 2018 |
| 9.85 |
| 0.28 |
| (0.13) |
| 0.15 |
| (0.29) |
| — |
| (0.29) |
| 9.71 |
| 1.59 |
| 14,574 |
| 0.47 |
| 2.92 |
| 25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Class
Y |
|
|
|
|
|
|
|
|
|
|
|
|
| |
For
the year ended December 31, 2022 |
| $ |
10.39 |
| 0.28 |
| (1.48) |
| (1.20) |
| (0.28) |
| — |
| (0.28) |
| $ |
8.91 |
| (11.63) |
% |
$ |
58,932 |
| 0.35 |
% |
2.94 |
% |
40 |
% |
For
the year ended December 31, 2021 |
| 10.75 |
| 0.23 |
| (0.33) |
| (0.10) |
| (0.26) |
| — |
| (0.26) |
| 10.39 |
| (0.95) |
| 58,668 |
| 0.35 |
| 2.21 |
| 37 |
|
For
the year ended December 31, 2020 |
| 10.20 |
| 0.26 |
| 0.55 |
| 0.81 |
| (0.26) |
| — |
| (0.26) |
| 10.75 |
| 8.04 |
| 59,856 |
| 0.35 |
| 2.46 |
| 28 |
|
For
the year ended December 31, 2019 |
| 9.71 |
| 0.28 |
| 0.50 |
| 0.78 |
| (0.29) |
| — |
| (0.29) |
| 10.20 |
| 8.15 |
| 52,275 |
| 0.36 |
| 2.83 |
| 29 |
|
For
the year ended December 31, 2018 |
| 9.85 |
| 0.29 |
| (0.13) |
| 0.16 |
| (0.30) |
| — |
| (0.30) |
| 9.71 |
| 1.69 |
| 37,713 |
| 0.35 |
| 3.03 |
| 25 |
|
(A)
Net
investment income per share has been calculated using the average daily shares
outstanding during the period.
(B)
Total returns shown exclude the effect of applicable sales charges for years
prior to December 31, 2021.
(C)
Portfolio turnover rate is calculated on the basis of the Fund as a whole
without distinguishing between classes of shares issued.
|
| |
DIAMOND
HILL FUNDS | PROSPECTUS | FEBRUARY 28, 2023| DIAMOND-HILL.COM
60 |
|
|
|
|
|
|
|
| |
Investment
Adviser
Diamond
Hill Capital Management, Inc.
325
John H. McConnell Boulevard, Suite 200
Columbus,
Ohio 43215
Custodian
State
Street Bank and Trust Company
200
Clarendon Street
16th
Floor
Boston,
MA 02116
Independent
Registered Public Accounting Firm
Cohen
& Company, Ltd.
1350
Euclid Ave., Suite 800
Cleveland,
Ohio 44115
Legal
Counsel
Thompson
Hine LLP
41
South High Street, Suite 1700
Columbus,
Ohio 43215-6101
Distributor
Foreside
Financial Services, LLC
Three
Canal Plaza, Suite 100
Portland,
ME 04101
For
Additional Information, call
Diamond
Hill Funds
Toll
Free 888-226-5595
|
|
To
Learn More
Several
additional sources of information are available to you. The Statement of
Additional Information (SAI), incorporated into this prospectus by
reference, contains detailed information on fund policies and operations.
Additional information about the funds’ investments is available in the
funds’ annual and semi-annual reports to shareholders. The funds’ annual
report contains management’s discussion of market conditions and
investment strategies that significantly affected each fund’s performance
during its last fiscal year.
Call
the funds at 888-226-5595 between the hours of 8:00 a.m. and
6:00 p.m. Eastern time on days the funds are open for business
to request free copies of the SAI and the funds’ annual and semi-annual
reports, to request other information about the funds and to make
shareholder inquiries. On days when the NYSE closes early, the call center
hours will be reduced accordingly.
The
funds’ SAI, annual and semi-annual reports to shareholders are also
available, free of charge, on the funds’ Internet site at
www.diamond-hill.com.
You
may obtain reports and other information about the funds on the EDGAR
Database on the SEC’s Internet site at http://www.sec.gov, and copies of
this information may be obtained, after paying a duplicating fee, by
electronic request at the following e-mail address: [email protected].
Investment
Company Act #811-08061
STATPRO
022823 |