About the manager

Ariel Investments was founded in 1983 with the idea that wealth can be created by investing in great companies at bargain prices, whose true value would then be realized over time. Although Ariel has grown significantly, the company remains true to its original philosophy of patient, bottom-up value investing anchored in focus and fundamentals. Patience serves as the core of its corporate philosophy. Ariel believes that the most successful investors proceed, not by sudden leaps and bounds, but by the steady, painstaking work of research, stock selection and investment monitoring.

Investment philosophy

By concentrating on the long-term, Ariel's patient investment approach allows the company to take advantage of buying opportunities that frequently arise from Wall Street's excessive focus on the short term. Ariel invests in quality companies in industries where it has proven expertise and only buys when these quality businesses are selling at an excellent value.

Investment approach

The Ariel Small/Mid Cap Value Strategy invests primarily in stocks of companies with market capitalizations between $1 billion and $10 billion. The Strategy seeks to invest in companies when they are trading at a low valuation relative to potential earnings (price/earnings ratio¹ generally less than 13x forward cash earnings²) and/or a low valuation relative to intrinsic worth (generally a 40% discount to private market value). Ariel endeavors to follow a patient approach that focuses on the long term and that allows it to take advantage of rare buying opportunities that may arise from what it believes is a tendency of financial markets to excessively focus on the short term. Ariel expects to invest in quality companies that it has analyzed carefully and intends to make investments only when such investments are selling at what it believes to be excellent values. Ariel believes that its demand for depth over breadth creates a concentrated portfolio of 25-40 well-researched stocks in industries where it believes it has appropriate experience, understanding and expertise.

Ariel intends to hold investments for a relatively long period of time-typically two to five years.

Portfolio Managers

John W. Rogers, Jr., Chairman, CEO & Chief Investment Officer of Ariel Investments; Portfolio Manager, Ariel Small, Small/Mid and Mid Cap Products; Lead Portfolio Manager, Ariel Fund & Ariel Appreciation Fund

John's passion for investing started when he was 12 years old when his father bought him stocks every birthday and every Christmas instead of toys. His interest grew while majoring in Economics at Princeton University. After graduation, he worked as a stockbroker for 2½ years at William Blair and Company, LLC — a regional investment banking firm. In 1983, at age 24, John founded Ariel Investments to focus on undervalued small and medium-sized companies showing strong growth potential. Patience served as the cornerstone of a disciplined approach that still drives the firm today. Beyond Ariel, John serves as a corporate board member for three Fortune 500 companies — Aon Corporation, Exelon Corporation and McDonald's Corporation. His civic mindedness is reflected in his roles as chairman of the board of the University of Chicago Laboratory Schools, trustee of the University of Chicago, director of the Chicago Urban League and member of the John S. and James L. Knight Foundation. In 2008, John's dedication to the community was recognized when he was awarded Princeton's highest honor, the Woodrow Wilson Award, bestowed annually on a graduate whose career embodies a commitment to national service. Following the election of President Obama, John served as co-chair for the Presidential Inaugural Committee 2009. He received an AB in economics in 1980 from Princeton University where he was also captain of the varsity basketball team.

ESG commitment

Ariel believes that ethical business practices make good investment sense. For example, it believes that companies that adopt environmentally sound policies are less likely, in the long run, to face government regulation. It believes that those that foster community involvement among their employees should inspire community support. It believes that companies that cultivate diversity are more likely to attract and recruit the best talent and broaden their markets in profitable new directions. Towards this end, Ariel encourages the companies it invests in to have an open dialogue on:

• Giving back to the community
• A dedication to education
• Proactive diversity practices

Conversely, Ariel does not invest in corporations whose primary source of revenue is derived from the production or sale of tobacco products or the manufacture of handguns, and it also screens out nuclear energy companies as a result of their environmental liabilities.

Pax World Management makes no assurance that the manner in which Ariel Investments manages its assets in the ESG Managers® Portfolios is the same as or entirely consistent with the manner in which it manages any of its other Funds or accounts.

Click here to access the Ariel web site

Ariel Investments is not affiliated with ALPS Distributors, Inc. 

¹Price/earnings ratio is a valuation ratio of a company's current share price compared to its per-share earnings.

²Forward cash earnings estimate future real earnings, distinct from “accounting” earnings.

Funds that emphasize investments in smaller companies may experience greater price volatility.