The fund exited its position in IP as part of a broader portfolio adjustment amid market uncertainty and sector rotation.
Diamond Hill Capital’s Large Cap Strategy sold its stake in International Paper Company (NYSE:IP) during Q1 2026, as disclosed in its investor letter. The fund’s overall performance declined 2.39% net of fees, underperforming the Russell 1000 Value Index’s 2.10% return for the quarter.
Stock selection in industrials and consumer discretionary, along with an underweight in communication services, supported relative performance. However, weak picks in information technology, financials, and healthcare weighed on results. Geopolitical tensions, including the Iran conflict, and concerns over AI’s impact on tech valuations influenced portfolio decisions.
The fund shifted focus toward defensive sectors and cyclicals less tied to AI-driven growth, signaling a cautious outlook amid broader market volatility.