Here's What Led SCCM Enhanced Equity Income Fund to Sell Its Position in Rio Tinto plc (RIO)

Cullen Capital Management, LLC, operating under the name Schafer Cullen Capital Management, Inc. (SCCM), has released its “SCCM Enhanced Equity Income Fund” third-quarter investor letter. A copy of the letter can be downloaded here. US equities continued to rise in the third quarter, with the S&P 500 returning 8.1% while the Russell 1000 Value was up 5.3%. The composite returned 0.9% (net) in the quarter, compared to a 3.5% return for the S&P 500 Buy-Write Index (BXM) and a 2.5% return for the SPDR Bloomberg High Yield Bond ETF (JNK). In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.

In its third-quarter 2025 investor letter, SCCM Enhanced Equity Income Fund highlighted stocks such as Rio Tinto Group (NYSE:RIO). Rio Tinto Group (NYSE:RIO) is a leading mineral resource exploration and mining company. The one-month return for Rio Tinto Group (NYSE:RIO) was 6.35%, and its shares gained 18.71% over the last 52 weeks. On December 04, 2025, Rio Tinto Group (NYSE:RIO) stock closed at $73.73 per share, with a market capitalization of $120.435 billion.

SCCM Enhanced Equity Income Fund stated the following regarding Rio Tinto Group (NYSE:RIO) in its third quarter 2025 investor letter:

"Our position in Rio Tinto Group (NYSE:RIO) was sold in the quarter. As the world’s largest producer of iron ore and one of the largest producers of aluminum, copper, and other commodities that are vital to global GDP growth, Rio Tinto has strong long-term growth potential. However, we exited the position due to a number of challenges in the near and medium term, including a potential state of global oversupply of iron ore, which could lead to declining prices in the coming quarters and years. Additionally, with over half of total company revenue from China, declining iron ore demand from the Chinse construction and property sectors could continue to weigh on sales."

Rio Tinto Group (NYSE:RIO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 37 hedge fund portfolios held Rio Tinto Group (NYSE:RIO) at the end of the third quarter, which was 31 in the previous quarter. While we acknowledge the potential of Rio Tinto Group (NYSE:RIO) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Rio Tinto Group (NYSE:RIO) and shared the list of some of the best FTSE dividend stocks to invest in. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.