Victory Capital, overseeing the RS Large Cap Value Strategy, released its Q2 2026 investor letter.
A copy of the letter can be downloaded here
The RS Large Cap Value Strategy underperformed the Russell 1000 Value Index in the second quarter of 2026 as unfavorable stock selection and sector allocation weighed on relative performance. U.S. equities remained resilient despite the Iran conflict, elevated inflation, labor market concerns and uncertainty around Federal Reserve leadership, with the S&P 500 gaining 15% and the Russell 1000 Value returning 13.9%. Market leadership broadened beyond the Magnificent Seven toward semiconductor, memory, power and other AI infrastructure beneficiaries, while investors also moved down the cap spectrum, helping the Russell 2000 Value rise 17.2%.
Information Technology returned 80.63%, while Energy fell 13.77%; stock selection in Technology and Industrials and an underweight Technology position were key detractors. Looking ahead, the firm remains focused on risk management, valuation discipline and identifying financially strong, out-of-favor or misunderstood companies with capable management, improving ROIC, attractive reinvestment opportunities and share prices below estimated intrinsic value. In addition, please check the Strategy’s top five holdings to know its best picks in 2026.