Unlocking the Next Market Cycle With Data-Driven Insights

Key takeaways

Value's time is coming: Economic indicators suggest the market cycle is shifting from narrow AI-driven growth toward a broader recovery that typically favors value stocks – the challenge will be successfully picking the winners and losers.
The systematic advantage: The explosion of market data available has created the opportunity for a systematic investment approach to pave new paths to alpha generation and risk management.
Proven results: Nomura Growth and Income Fund’s (FGIPX) systematic bottom-up approach selects attractive quality factors, delivering a history of outperformance while maintaining disciplined value exposure and the potential for income generationgenerated

The boom around artificial intelligence (AI) infrastructure over the past few years has created outsized index returns driven by a narrow group of stocks. This dynamic, coupled with a cyclical lull in the rest of the economy, has led many investors’ portfolios to be heavily skewed toward growth stocks. So far, this skew has been rewarded.

For the same reasons, value stocks have struggled in recent years. But we believe the market is beginning to change: prior to the recent war in the Middle East, economic indicators across the industrial economy started pointing toward a cyclical recovery. Even though the rise in energy prices from the conflict may provide a headwind to that recovery, lagged impacts of fiscal and monetary policy – along with the need to build inventories in certain segments of the economy – should mean that manufacturing will continue to improve, particularly in the US.

This broadening out of growth has typically led to value outperformance in the past. However, every recovery still results in winners and losers. The difference today is the amount of data available to help determine who those winners and losers may be.

From Bloomberg terminals to big data

For decades, money managers have been heavily armed with analysts, poring over sell-side research, financial statements, and Bloomberg terminals. It was a world of Excel spreadsheets, late nights, and hefty research budgets. Information scarcity was the name of the game.

Now, we're living in a world where your morning coffee order generates data, your video streaming service selections create behavioral patterns, and even your decision to skip the gym gets tracked somewhere in the digital ether. Back in 2010, humanity produced a modest 2 zettabytes (or 2 trillion gigabytes) of data annually. By 2028, we will be producing roughly 394 zettabytes of data – a 197x increase, in under 20 years.

Figure 1: Zettabytes of data generated

Source: Statista. A zettabyte (ZB) is a unit of digital information storage equal to one sextillion bytes (or a trillion gigabytes), frequently used to quantify global data traffic or cloud storage.

This data explosion has fundamentally transformed areas of investing. The data industry is massive, with sales organizations targeting prospects across many industries, including financial services. The sheer volume and velocity of data flowing through markets today has created new pathways to alpha generation and risk management that human brains simply can't process on their own.

The systematic approach: Quality factor selection and dynamic weighting

FGIPX seeks long-term growth of capital and current income. The model that powers Nomura Growth and Income Fund processes approximately 100 million lines of data weekly. To put that in perspective, if you printed that data and stacked it, you'd have a tower roughly 33 feet tall – every single week.

But raw computational power is just the beginning. What separates effective systematic investing is careful quality factor selection and portfolio construction. After extensive research and testing, the Fund employs approximately 70 carefully selected quality factors. These aren't chosen because they generated the highest returns in back testing – instead, they're selected for consistency across thousands of simulated market environments, and different sectors, geographies, and market capitalizations.

The system uses dynamic weighting that reallocates the portfolio when quality factors start moving in lockstep, seeking to avoid unwanted correlations and potential portfolio biases. The goal is to deliver a diverse set of alpha drivers in the most efficient and risk-aware way possible.

Systematic investing is designed to reduce style drift – the Fund maintains value exposure while aiming to deliver at least the Russell 1000® Value Index dividend yield. The strategy seeks to achieve this by owning both value stocks with capital appreciation potential and dividend-paying securities. The Fund will also pursue income by investing in real estate investment trusts (REITs) and convertible securities, to help mitigate overall portfolio risk for periods when income stocks fall out of favor, while still maintaining its income mandate.

The results speak for themselves: on a rolling one-year basis, the Fund has outperformed the Russell 1000 Value Index in 96% of periods, net of fees. On a rolling three-year basis, that number reached 100%.

Figure 2: The Nomura Growth and Income Fund (FGIPX) has consistently outperformed its benchmark

Source: Morningstar. **The performance quoted represents past performance and does not guarantee future results. For standardized performance, please visit the** **Fund’s website**.

The investment case

The investment landscape has fundamentally shifted. We're in a world where data is abundant, and those who can process it most effectively hold the competitive advantage. The explosion of available information has created a compelling case for systematic investment management.

Those with proven track records in processing vast datasets and converting them into diversified alpha streams offer investors something traditional investment approaches tend not to specialize in: the ability to harness the full power of our data-driven world while maintaining disciplined exposure to value investing.

For investors seeking pure value exposure, reliable income generation, and competitive risk-adjusted returns, the systematic approach addresses the realities of today's information-rich market environment. In a world generating 394 zettabytes of data annually, having sophisticated tools to process that information isn't just helpful – it’s becoming a key performance driver.

IMPORTANT INFORMATION

For financial professional use only. Not for use with the general public.

As of December 1, 2025, Nomura Holding America Inc. completed the acquisition of Macquarie Asset Management's US and European public investments business.

The performance quoted represents past performance and does not guarantee future results. Investment return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. Performance data for all share classes current to the most recent month end may be obtained by calling 800 523-1918 or visiting nomuraassetmanagement.com/performance.

Total returns may reflect waivers and/or expense reimbursements by the manager and/or distributor (as applicable) for some or all of the periods shown. Performance would have been lower without such waivers and reimbursements.

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Investing involves risk including the possible loss of principal. The investment capabilities described in this website involve risks due, among other things, to the nature of the underlying investments. All examples herein are for illustrative purposes only and there can be no assurance that any particular investment objective will be realized or any investment strategy seeking to achieve such objective will be successful. Past performance is not a reliable indication of future performance.

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Nomura Asset Management is part of the Investment Management Division of the Nomura Group, providing integrated public and private market asset management services across equities, fixed income, private credit and multi-asset solutions to intermediary and institutional clients. Nomura Asset Management primarily operates through several distinct investment managers, which includes Nomura Investment Management Business Trust (NIMBT), a Securities and Exchange Commission (SEC) registered investment adviser. Investment advisory services are provided to the Nomura Funds by Delaware Management Company, a series of NIMBT. The Nomura Funds are distributed by Delaware Distributors, L.P., a registered broker/dealer and member of the Financial Industry Regulatory Authority (FINRA) and an affiliate of NIMBT. The Nomura Funds are distributed by Delaware Distributors, L.P., a registered broker/dealer and member of the Financial Industry Regulatory Authority (FINRA) and an affiliate of NIMBT.

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Over time, the value of your investment in the Fund will increase and decrease according to changes in the value of the securities in the Fund’s portfolio. An investment in the Fund may not be appropriate for all investors.

The Fund’s principal risks include but are not limited to the following:
Market risk is the risk that all or a majority of the securities in a certain market - such as the stock or bond market - will decline in value because of factors such as adverse political or economic conditions, future expectations, investor confidence, or heavy institutional selling. ● Governments or regulatory authorities may take actions that could adversely affect various sectors of the securities markets and affect fund performance. ● Large-capitalization companies tend to be less volatile than companies with smaller market capitalizations. This potentially lower risk means that the Fund's share price may not rise as much as the share prices of funds that focus on smaller capitalization companies. ● The possibility that a single security’s increase or decrease in value may have a greater impact on a fund’s value and total return because the fund may hold larger positions in fewer securities than other funds. In addition, a fund that holds a limited number of securities may be more volatile than those funds that hold a greater number of securities. ● REIT investments are subject to many of the risks associated with direct real estate ownership, including changes in economic conditions, credit risk, and interest rate fluctuations. A "value stock" is a stock that is believed to be undervalued. Investments in value stocks are subject to the risk that the stocks are appropriately valued or that the stocks may decline in value. There is no guarantee that dividend-paying stocks will continue to pay dividends.

The Russell 1000 Value Index measures the performance of the large-cap value segment of the US equity universe. It includes those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.

Index performance returns do not reflect any management fees, transaction costs, or expenses. Indices are unmanaged and one cannot invest directly in an index.

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Unlocking the Next Market Cycle With Data-Driven Insights

Key takeaways

From Bloomberg terminals to big data

Figure 1: Zettabytes of data generated

The systematic approach: Quality factor selection and dynamic weighting

Figure 2: The Nomura Growth and Income Fund (FGIPX) has consistently outperformed its benchmark

The investment case

Disclosures

Policies

From Bloomberg terminals to big data

The systematic approach: Quality factor selection and dynamic weighting

Figure 2: The Nomura Growth and Income Fund (FGIPX) has consistently outperformed its benchmark

The investment case

Disclosures

Policies

​

Unlocking the Next Market Cycle With Data-Driven Insights

Key takeaways

​

From Bloomberg terminals to big data

​

Figure 1: Zettabytes of data generated

​

The systematic approach: Quality factor selection and dynamic weighting

​

Figure 2: The Nomura Growth and Income Fund (FGIPX) has consistently outperformed its benchmark

​

​

The investment case

​

​

​

From Bloomberg terminals to big data

The systematic approach: Quality factor selection and dynamic weighting

Figure 2: The Nomura Growth and Income Fund (FGIPX) has consistently outperformed its benchmark

The investment case

Disclosures

Policies