UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM N-CSR
 
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT

INVESTMENT COMPANIES

 
Investment Company Act file number 811-04244
 

SOUND SHORE FUND, INC.

Three Canal Plaza, Suite 600
Portland, Maine 04101
 
T. Gibbs Kane, Jr., President
8 Sound Shore Drive
Greenwich, Connecticut 06830
 
 
Date of fiscal year end: December 31
 
Date of reporting period: January 1, 2022 – June 30, 2022
 
 
 

Item 1.  Reports to Stockholders.
 
1
June
30,
2022
Dear
Investor:
The
Sound
Shore
Fund
Investor
Class
(SSHFX)
and
Institutional
Class
(SSHVX)
declined
13.45%
and
13.41%,
respectively,
in
the
second
quarter
of
2022,
trailing
the
Russell
1000
Value
Index
(Russell
Value)
which
declined
12.21%.
As
long-term
investors,
we
highlight
that
Sound
Shore’s
30-year
annualized
returns
of
9.65%
and
9.91%,
for
SSHFX
and
SSHVX,
respectively,
as
of
June
30,
2022,
were
ahead
of
the
Russell
Value
at
9.54%.
We
are
required
by
FINRA
to
say
that:
Past
performance
is
no
guarantee
of
future
results.
Current
performance
may
be
lower
or
higher
than
the
performance
data
quoted.
Investment
return
and
principal
value
will
fluctuate
so
that
an
investor’s
shares,
when
redeemed,
may
be
worth
more
or
less
than
their
original
cost.
For
the
most
recent
month-end
performance,
please
visit
the
Fund’s
website
at
www.soundshorefund.com.
In
a
broadly
down
market,
globally,
Sound
Shore’s
second
quarter
2022
results
were
ahead
of
the
S&P
500
Index
(“S&P
500”)
but
behind
the
Russell
Value
as
noted
above.
Higher
inflation,
rising
interest
rates
and
a
slowing
economy
pushed
the
S&P
500
into
bear
market
territory.
The
S&P
500
closed
down
16.1%
for
2Q,
the
worst
second
quarter
performance
since
1970
(down
18.0%).
Similarly,
the
technology
focused
NASDAQ,
small
cap
Russell
2000
and
MSCI
World
indices
fell
precipitously.
Equity
investors
had
plenty
of
company
as
within
major
asset
classes,
only
the
US
dollar
and
US
Treasuries
finished
up.
How
long
this
weakness
will
persist
and
whether
we
are
headed
toward
a
recession
are
being
debated
by
economic
prognosticators.
At
Sound
Shore,
we
remain
focused
on
the
data
we
get
from
our
company
specific
research.
Key
factors
to
watch
will
be
how
consumers
adjust
their
spending
due
to
inflation
(June’s
Consumer
Confidence
level
was
at
a
16-month
low)
and
if
the
two
expected
0.75%
Fed
interest
rate
increases
(July
27
and
Sept.
21,
2022)
will
help
ease
the
pain
of
the
highest
inflation
readings
in
a
very
long
time.
The
selloff
was
broad
with
all
eleven
S&P
sectors
finishing
lower.
The
consumer
discretionary
and
financial
services
sectors
were
some
of
the
hardest
hit.
Despite
solid
current
profits
and
cash
flow,
portfolio
holdings
General
Motors
(autos)
and
PVH
Corp
(apparel)
were
lower
as
the
market
questioned
the
consumer’s
resiliency.
And,
as
is
often
the
case
in
a
volatile
market,
financials
sold
off
in
response
to
rising
credit
concerns.
Morgan
Stanley
and
SVB
Financial
(“SVB”),
both
long-term
holdings,
retreated
despite
having
business
models
that
are
more
resilient,
over-capitalized
and
underappreciated
by
the
market.
In
June,
the
Federal
Reserve’s
stress
tests
again
blessed
the
health
of
the
overall
banking
system.
Morgan
Stanley
stood
out
with
an
11%
increase
in
its
annual
dividend,
yielding
4.1%
at
quarter’s
end.
The
weakest
performer
in
the
quarter
among
our
group
of
financials
was
SVB.
Given
the
strength
of
its
loan
portfolio,
best-in-class
deposit
growth,
and
an
asset
mix
that
benefits
from
rising
interest
rates,
we
added
to
the
position
at
below
10
times
our
estimate
for
2023
earnings.
We
took
similar
action
during
the
stock’s
sell-off
in
early
2020,
and
recognize
that
patience
may
be
required.
Another
detractor
was
homebuilder
Lennar,
one
of
the
industry’s
largest.
We
added
the
name
during
the
fourth
quarter
of
2018
market
selloff
when
Lennar
was
trading
below
normal
at
7.5
times
earnings
and
1.1
times
tangible
book
value.
We
believed
the
company
had
scale-driven
advantages
over
small
and
mid-size
builders,
and
also
less
exposure
to
sluggish
premium
housing
trends
versus
its
competitors.
Since
the
end
of
2018,
Lennar’s
net
debt
to
capital
has
declined
from
32%
to
13%
in
the
most
THREE
CANAL
PLAZA,
PORTLAND,
ME
04101
1-800-551-1980
2
recent
quarter.
The
increased
cash
flow
has
also
enabled
more
than
$2.1B
of
stock
repurchases
over
the
past
four
quarters.
Lennar
plans
to
simplify
its
portfolio
to
focus
more
as
a
pure-play
builder,
with
less
asset
intensity,
which
will
increase
returns
on
capital
and
cash
flow.
After
material
outperformance
in
2020
and
2021,
during
which
we
trimmed
our
exposure,
Lennar
has
been
hit
hard
in
2022
by
the
sharp
increase
in
interest
rates,
adding
to
concerns
around
home
affordability.
Given
the
selloff
this
year,
Lennar’s
valuation
has
fallen
to
4
times
earnings
and
price
to
tangible
book
value
retreated
back
to
1.1
times
at
the
end
of
June,
despite
the
company
earning
an
approximate
30%
return
on
tangible
equity
over
the
past
year.
While
the
short-term
outlook
for
housing
is
clouded
by
a
potential
pause
in
activity
due
to
mortgage
rate
shock,
the
limited
supply
of
housing
has
never
been
more
severe,
as
illustrated
in
the
chart
below.
Housing
is
an
example
of
an
industry
that
has
entered
this
point
in
the
cycle
in
a
different
position
than
in
the
past,
as
recession
scenarios
are
estimated
by
the
market.
Not
unlike
the
auto
sector,
which
has
low
inventories
and
has
been
producing
below
the
normal
long-term
trend
since
2020,
the
housing
market
is
under-supplied.
Despite
the
likely
short-term
slowdown
implied
by
the
changing
economic
outlook,
our
team
is
confident
in
Lennar’s
balance
sheet,
strategy,
and
management
team
and
we
added
to
the
position
during
the
quarter.
3
On
the
positive
side,
a
number
of
our
health
care
names
outperformed,
including
drug
maker
Merck
&
Co.
and
health
product
supplier
Perrigo.
Benefitting
from
a
best
in
class
research
and
development
team,
Merck’s
progress
is
being
fueled
by
the
impressive
growth
of
its
immuno-oncology
cancer
drug,
Keytruda.
The
stock
remains
attractive
at
less
than
12
times
2023
earnings.
Meanwhile,
Perrigo
is
the
leading
private
label
and
branded
drug
manufacturer
with
a
market
share
of
approximately
70%.
Consumers
may
not
realize
it,
but
the
store
brand
Tylenol,
Allegra,
Prilosec,
etc.
that
they
purchase
is
likely
produced
by
Perrigo.
Having
navigated
through
supply
chain
disruptions
during
the
pandemic,
management
is
aimed
at
growth
and
margin
improvement
and
we
see
significant
upside
potential
from
here.
With
nearly
45
years
of
experience
and
having
been
through
numerous
market
cycles,
we
remain
alert
in
this
volatile
environment.
Our
contrarian
investment
philosophy
has
always
focused
on
finding
attractively
valued
companies
with
internally
driven
earnings
that
can
drive
value
for
years
to
come.
Our
long-term
investment
process
looks
forward
to
assess
where
a
company’s
normal
earning
power
will
be.
In
fact,
it
is
often
periods
of
uncertainty
which
create
the
best
opportunities
for
our
strategy.
This
leads
us
to
stocks
with
management
teams
employing
strategies
that
are
durable
and
have
sustainable
businesses
we
want
to
partner
with
in
our
portfolio.
The
ability
to
have
a
long-term
view
is
increasingly
rare,
but
will
likely
determine
our
success.
Although
there
may
not
be
a
quick
resolution
to
the
current
environment,
we
believe
that
stock
prices
will
increasingly
begin
to
discount
the
complex
macro
outlook.
Patience
will
be
tested
and
we
must
rely
on
our
process,
our
resolve
and
our
conviction.
When
the
market
senses
uncertainty,
equities
fall
sharply
and
in
unison,
without
regard
to
fundamentals
or
an
eye
to
the
future.
As
confidence
returns,
quality
at
an
attractive
price
will
likely
outperform.
At
Sound
Shore,
we
believe
our
portfolio
is
well
positioned
for
trends
that
are
liable
to
emerge,
post-crisis.
The
table
below
outlines
performance
following
steep
market
declines.
The
future
may
not
repeat
the
past,
however
the
opportunity
for
patient
investors
is
potentially
a
good
one.
Sound
Shore
performance
results
after
crisis
sell-offs:
4
Currently,
our
portfolio
is
attractively
valued
at
an
average
twelve
month
forward
P/E
ratio
of
8.8
times
versus
the
S&P
500
of
15.8
times
and
the
Russell
Value
of
12.5
times.
We
appreciate
your
investment
alongside
ours
and
encourage
you
to
reach
out
with
any
questions
or
comments.
Sincerely,
SOUND
SHORE
FUND
Harry
Burn,
III
John
P.
DeGulis
T.
Gibbs
Kane,
Jr.
Co-Portfolio
Managers
Important
Information
Performance
data
quoted
represents
past
performance
and
is
no
guarantee
of
future
results.
The
Fund’s
Investor
Class
1,
5,
and
10-year
average
annual
total
returns
for
the
period
ended
June
30,
2022
were
-9.79%,
5.74%,
and
10.40%,
respectively.
The
Fund’s
Institutional
Class
1,
5,
and
10-year
average
annual
total
returns
for
the
same
period
were
-9.60%,
5.92%,
and
10.59%,
respectively.
Fund
returns
assume
the
reinvestment
of
all
dividend
and
capital
gain
distributions.
As
stated
in
the
current
prospectus,
the
total
annual
operating
expense
ratio
(gross)
is
0.93%
for
the
Investor
Class
and
0.83%
for
the
Institutional
Class.
The
net
expense
ratio
for
the
Institutional
Class
is
0.75%
pursuant
to
an
expense
limitation
agreement
between
the
Adviser
and
the
Fund.
This
agreement
is
in
effect
until
at
least
May
1,
2023.
The
performance
for
the
Institutional
Class
prior
to
its
inception
on
12/9/13
is
based
on
the
performance
of
the
Investor
Class,
adjusted
to
reflect
the
lower
expense
ratio
of
the
Institutional
Class
(net
of
expense
reimbursements).
The
Standard
&
Poor’s
500
Index
is
an
unmanaged
index
representing
the
average
performance
of
500
widely
held,
publicly
traded,
large
capitalization
stocks.
The
1,
5,
and
10-year
average
annual
total
returns
for
the
same
period
were
-10.62%,
11.31%,
and
12.96%.
The
Russell
1000
Value
Index
measures
the
performance
of
the
large-cap
value
segment
of
the
U.S.
equity
universe.
It
includes
those
Russell
1000
companies
with
lower
price-to-book
ratios
and
lower
expected
growth
values.
The
1,
5,
and
10-
year
average
annual
total
returns
for
the
same
period
were
-6.82%,
7.17%,
and
10.50%.
The
Nasdaq
Composite
Index
measures
all
Nasdaq
domestic
and
international
based
common
type
stocks
listed
on
The
Nasdaq
Stock
Market.
The
Russell
2000®
Index
measures
the
performance
of
the
small-cap
segment
of
the
US
equity
universe.
The
Russell
2000
Index
is
a
subset
of
the
Russell
3000®
Index
representing
approximately
10%
of
the
total
market
capitalization
of
that
index.
It
includes
approximately
2,000
of
the
smallest
securities
based
on
a
combination
of
their
market
cap
and
current
index
membership.
The
MSCI
World
Index
is
a
broad
global
equity
index
that
represents
large
and
mid-cap
equity
performance
across
all
23
developed
markets
countries.
It
covers
approximately
85%
of
the
free
float-adjusted
market
capitalization
in
each
country.
It
is
not
possible
to
invest
directly
in
an
Index.
Data
presented
reflects
that
of
the
underlying
holdings
of
the
Fund,
not
of
the
Fund
itself.
Forward
P/E
(estimated
price-to-earnings)
is
a
measure
of
the
P/E
using
forecasted
earnings
for
the
P/E
calculation.
An
investment
in
the
Fund
is
subject
to
risk,
including
the
possible
loss
of
principal
amount
invested.
Mid
Cap
Risk:
Securities
of
medium
sized
companies
may
be
more
volatile
and
more
difficult
to
liquidate
during
market
downturns
than
securities
of
large,
more
widely
traded
companies.
Foreign
5
Securities
Risk:
The
Fund
may
invest
in
foreign
securities
primarily
in
the
form
of
American
Depositary
Receipts.
Investing
in
the
securities
of
foreign
issuers
also
involves
certain
special
risks,
which
are
not
typically
associated
with
investing
in
U.S.
dollar-denominated
securities
or
quoted
securities
of
U.S.
issuers
including
increased
risks
of
adverse
issuer,
political,
regulatory,
market
or
economic
developments,
changes
in
currency
rates
and
in
exchange
control
regulations.
The
Fund
is
also
subject
to
other
risks,
including,
but
not
limited
to,
risks
associated
with
value
investing.
The
views
in
this
letter
were
those
of
the
Fund
managers
as
of
6/30/22
and
may
not
necessarily
reflect
their
views
on
the
date
this
letter
is
first
published
or
anytime
thereafter.
6
Sound
Shore
Fund,
Inc.
SCHEDULE
OF
INVESTMENTS
(Unaudited)
June
30,
2022
See
Notes
to
Financial
Statements.
Sector
Weightings
(a)
(as
of
June
30,
2022)
as
a
percentage
of
Net
Assets
(Unaudited)
Share
Amount
Value
Common
Stock
(97.3%)
(a)
Communication
Services
(
4.0%
)
Alphabet,
Inc.,
Class A
(b)
8,970‌
$
19,547,962‌
Verizon
Communications,
Inc.
409,945‌
20,804,709‌
40,352,671‌
Consumer
Discretionary
(
14.2%
)
General
Motors
Co.
(b)
673,365‌
21,386,073‌
Lennar
Corp.,
Class A
503,705‌
35,546,462‌
PVH
Corp.
596,760‌
33,955,644‌
Tempur
Sealy
International,
Inc.
1,090,655‌
23,307,297‌
Victoria's
Secret
&
Co.
(b)
975,525‌
27,285,434‌
141,480,910‌
Consumer
Staples
(
2.5%
)
Conagra
Brands,
Inc.
742,375‌
25,418,920‌
7
Sound
Shore
Fund,
Inc.
SCHEDULE
OF
INVESTMENTS
(Unaudited)(Continued)
June
30,
2022
See
Notes
to
Financial
Statements.
Share
Amount
Value
Energy
(
7.2%
)
Baker
Hughes
Co.
806,445‌
$
23,282,067‌
Coterra
Energy,
Inc.
787,870‌
20,319,167‌
Kinder
Morgan,
Inc.
1,691,990‌
28,357,753‌
71,958,987‌
Financials
(
20.1%
)
Alleghany
Corp.
(b)
14,225‌
11,850,848‌
Bank
of
America
Corp.
574,925‌
17,897,415‌
Berkshire
Hathaway,
Inc.,
Class B
(b)
86,215‌
23,538,419‌
Capital
One
Financial
Corp.
253,930‌
26,456,967‌
First
Republic
Bank
138,535‌
19,976,747‌
Morgan
Stanley
414,970‌
31,562,618‌
SVB
Financial
Group
(b)
82,540‌
32,602,475‌
Wells
Fargo
&
Co.
928,795‌
36,380,900‌
200,266,389‌
Health
Care
(
21.5%
)
Cardinal
Health,
Inc.
487,085‌
25,459,933‌
Elanco
Animal
Health,
Inc.
(b)
1,444,490‌
28,355,339‌
Elevance
Health,
Inc.
44,470‌
21,460,333‌
Hologic
,
Inc.
(b)
350,410‌
24,283,413‌
Merck
&
Co.,
Inc.
233,865‌
21,321,472‌
Organon
&
Co.
894,910‌
30,203,212‌
Perrigo
Co.
PLC
1,005,665‌
40,799,829‌
Pfizer,
Inc.
425,305‌
22,298,741‌
214,182,272‌
Industrials
(
5.9%
)
FedEx
Corp.
107,655‌
24,406,465‌
PACCAR,
Inc.
414,640‌
34,141,458‌
58,547,923‌
Information
Technology
(
15.3%
)
Applied
Materials,
Inc.
263,345‌
23,959,128‌
Flex,
Ltd.
(b)
2,416,795‌
34,971,024‌
NXP
Semiconductors
NV
217,180‌
32,149,155‌
Oracle
Corp.
481,405‌
33,635,767‌
8
See
Notes
to
Financial
Statements.
Sound
Shore
Fund,
Inc.
SCHEDULE
OF
INVESTMENTS
(Unaudited)(Concluded)
June
30,
2022
Share
Amount
Value
Information
Technology
(15.3%)
(continued)
Vontier
Corp.
1,219,490‌
$
28,036,075‌
152,751,149‌
Materials
(
2.3%
)
International
Paper
Co.
539,350‌
22,561,010‌
Utilities
(
4.3%
)
Vistra
Corp.
1,882,160‌
43,007,356‌
Total
Common
Stock
(97.3%)
(cost
$922,760,577)
970,527,587‌
Short-Term
Investment
(
3.2%
)
Money
Market
Fund
(3.2%)
First
American
Government
Obligations
Fund,
Class X,
1.29%
(c)
32,236,023‌
32,236,023‌
Total
Money
Market
Fund
(3.2%)
(cost
$32,236,023)
32,236,023‌
Investments,
at
value
(100.5%)
(cost
$954,996,600)
$
1,002,763,610‌
Other
Liabilities
Less
Assets
(-0.5%)
(5,108,601‌)
Net
Assets
(100.0%)
$
997,655,009‌
(a)
More
narrow
industries
are
utilized
for
compliance
purposes,
whereas
broad
sectors
are
utilized
for
reporting
purposes.
(b)
Non-income
producing
security.
(c)
Percentage
disclosed
reflects
the
money
market
fund’s
institutional
class
shares
7-day
yield
as
of
June
30,
2022.
PLC
Public
Limited
Company
9
Sound
Shore
Fund,
Inc.
STATEMENT
OF
ASSETS
AND
LIABILITIES
(Unaudited)
June
30,
2022
See
Notes
to
Financial
Statements.
ASSETS
Investments,
at
value
(Cost
$954,996,600)
$
1,002,763,610‌
Receivables:
Capital
shares
sold
279,808‌
Investment
securities
sold
2,273,605‌
Dividends
743,857‌
Foreign
tax
reclaims
175,224‌
Prepaid
expenses
38,885‌
Total
Assets
1,006,274,989‌
LIABILITIES
Payables:
Capital
shares
redeemed
915,379‌
Investments
purchased
6,958,600‌
Accrued
liabilities:
Advisory
fees
612,796‌
Administrator
fees
11,909‌
Transfer
agent
fees
and
expenses
58,621‌
Custodian
fees
20,854‌
Compliance
and
Treasurer
Services
fees
and
expenses
10,150‌
Professional
fees
28,663‌
Other
accrued
liabilities
3,008‌
Total
Liabilities
8,619,980‌
Net
Assets
$
997,655,009‌
COMPONENTS
OF
NET
ASSETS
Common
stock,
at
Par
Value
$
28,288‌
Paid-in
Capital
865,775,997‌
Distributable
earnings
131,850,724‌
Net
Assets
$
997,655,009‌
NET
ASSET
VALUE
Net
Assets
-
Investor
Class
Shares
$
541,119,274‌
Shares
Outstanding
-
Investor
Class
(100,000,000
shares
authorized,
par
value
$0.001)
15,415,178‌
Net
Asset
Value
(offering
&
redemption
price
per
share)
-
Investor
Class
Shares
$
35.10‌
Net
Assets
-
Institutional
Class
Shares
$
456,535,735‌
Shares
Outstanding
-
Institutional
Class
(100,000,000
shares
authorized,
par
value
$0.001)
12,872,424‌
Net
Asset
Value
(offering
&
redemption
price
per
share)
-
Institutional
Class
Shares
$
35.47‌
10
Sound
Shore
Fund,
Inc.
STATEMENT
OF
OPERATIONS
(Unaudited)
FOR
THE
SIX
MONTHS
ENDED
JUNE
30,
2022
See
Notes
to
Financial
Statements.
INVESTMENT
INCOME
Income:
Dividend
income
(net
of
foreign
withholding
taxes
of
$75,502)
$
10,507,607‌
Total
Income
10,507,607‌
Expenses:
Advisory
fees
(Note
3
)
4,313,687‌
Administrator
fees
81,420‌
Transfer
agent
fees
and
expenses
-
Investor
Class
Shares
327,484‌
Transfer
agent
fees
and
expenses
-
Institutional
Class
Shares
28,708‌
Custodian
fees
42,507‌
Compliance
and
Treasurer
Services
fees
and
expenses
(Note
3
)
72,650‌
Directors'
fees
and
expenses
(Note
3
)
91,520‌
Professional
fees
48,663‌
Registration
fees
-
Investor
Class
Shares
12,517‌
Registration
fees
-
Institutional
Class
Shares
12,537‌
Printing
and
postage
fees
-
Investor
Class
Shares
18,988‌
Printing
and
postage
fees
-
Institutional
Class
Shares
11,659‌
Miscellaneous
43,955‌
Total
Expenses
5,106,295‌
Expense
Reimbursements
-
Institutional
Class
Shares
(Note
3
)
(226,848‌)
Net
Expenses
4,879,447‌
Net
Investment
Income
5,628,160‌
REALIZED
AND
UNREALIZED
GAIN
(LOSS)
ON
INVESTMENTS
Net
realized
gain
on
investments
86,327,111‌
Net
change
in
unrealized
appreciation/(depreciation)
on
investments
(260,052,719‌)
Net
realized
and
unrealized
loss
on
investments
(173,725,608‌)
Net
decrease
in
net
assets
from
operations
$
(168,097,448‌)
11
Sound
Shore
Fund,
Inc.
STATEMENTS
OF
CHANGES
IN
NET
ASSETS
See
Notes
to
Financial
Statements.
For
the
Six
Months
Ended
June
30,
2022
(Unaudited)
For
the
Year
Ended
December
31,
2021
Operations:
Net
investment
income
$
5,628,160‌
$
11,710,053‌
Net
realized
gain
on
investments
86,327,111‌
265,625,978‌
Net
change
in
unrealized
appreciation
(depreciation)
on
investments
(260,052,719‌)
(14,100,501‌)
Increase
(decrease)
in
net
assets
from
operations
(168,097,448‌)
263,235,530‌
Distributions
to
shareholders:
Investor
Class
Shares
(2,572,328‌)
(149,441,808‌)
Institutional
Class
Shares
(2,371,275‌)
(124
,
411
,
263‌)
Total
distributions
to
shareholders
(
4
,
943
,
603‌
)
(273,853,071‌)
Net
capital
share
transactions
(Note
6
):
Investor
Class
Shares
(35,931,505‌)
35,265,160‌
Institutional
Class
Shares
(39,936,490‌)
63,302,817‌
Total
capital
share
transactions
(75,867,995‌)
98,567,977‌
Total
increase
(decrease)
(248,909,046‌)
87,950,436‌
NET
ASSETS
Beginning
of
the
period
1,246,564,055‌
1,158,613,619‌
End
of
the
period
$
997,655,009‌
$
1,246,564,055‌
12
Sound
Shore
Fund,
Inc.
NOTES
TO
FINANCIAL
STATEMENTS
(Unaudited)
June
30,
2022
1.
Organization
Sound
Shore
Fund,
Inc.
(the
“Fund”)
was
incorporated
under
the
laws
of
the
State
of
Maryland
on
February
19,
1985
and
is
registered
as
a
diversified,
open-end
management
investment
company
under
the
Investment
Company
Act
of
1940
(the
“Act”).
The
investment
objective
of
the
Fund
is
growth
of
capital.
The
Fund
qualifies
as
an
investment
company
as
defined
in
Financial
Accounting
Standards
Codification
946
Financial
Services
Investment
Companies.
The
total
number
of
shares
of
common
stock
which
the
Fund
is
authorized
to
issue
is
200,000,000,
par
value
$0.001
per
share
of
which
100,000,000
shares
are
designated
to
the
Investor
Class
and
100,000,000
shares
are
designated
to
the
Institutional
Class.
The
Board
of
Directors
(the
“Board”)
may,
without
shareholder
approval,
classify
or
reclassify
any
unissued
shares
into
other
classes
or
series
of
shares.
Each
share
of
the
Fund
has
equal
dividend,
distribution,
liquidation
and
voting
rights
(except
as
to
matters
relating
exclusively
to
one
class
of
shares),
and
fractional
shares
have
those
rights
proportionately.
2.
Significant
Accounting
Policies
These
financial
statements
are
prepared
in
accordance
with
accounting
principles
generally
accepted
in
the
United
States
of
America
(“GAAP”),
which
require
management
to
make
estimates
and
assumptions
that
affect
the
reported
amounts
of
assets
and
liabilities,
disclosure
of
contingent
liabilities,
if
any,
at
the
date
of
the
financial
statements,
and
the
reported
amounts
of
increase
and
decrease
in
net
assets
from
operations
during
the
fiscal
period.
Actual
results
could
differ
from
those
estimates.
The
following
represents
the
significant
accounting
policies
of
the
Fund:
a.
Security
Valuation
Exchange-traded
securities
including
those
traded
on
the
National
Association
of
Securities
Dealers’
Automated
Quotation
system
(“NASDAQ”),
are
valued
at
the
last
quoted
sale
price
or
official
closing
price
as
provided
by
independent
pricing
services
as
of
the
close
of
trading
on
the
system
or
exchange
on
which
they
are
primarily
traded,
on
each
Fund
business
day.
In
the
absence
of
a
sale,
such
securities
are
valued
at
the
mean
of
the
last
bid
and
asked
prices.
Non-exchange-traded
securities
for
which
over-the-counter
market
quotations
are
readily
available
are
generally
valued
at
the
mean
between
the
current
bid
and
asked
prices
provided
by
independent
pricing
services.
Investments
in
other
open-end
regulated
investment
companies
are
valued
at
their
publicly
traded
net
asset
value
(“NAV”).
The
Fund
values
securities
at
fair
value
pursuant
to
procedures
adopted
by
the
Board
if
market
quotations
are
not
readily
available
(including
a
short
and
temporary
lapse
in
the
provision
of
a
price
by
the
regular
pricing
source)
or,
if
in
the
judgment
of
the
Adviser,
as
defined
in
Note
3,
the
prices
or
values
available
do
not
represent
the
fair
value
of
the
instrument.
Factors
which
may
cause
the
Adviser
to
make
such
a
judgment
include,
but
are
not
limited
to,
the
following:
(i)
only
a
bid
price
or
an
asked
price
is
available,
(ii)
the
spread
between
the
bid
price
and
the
asked
price
is
substantial,
(iii)
the
frequency
of
sales,
(iv)
the
thinness
of
the
market,
(v)
the
size
of
reported
trades,
and
(vi)
actions
of
the
securities
markets,
such
as
13
Sound
Shore
Fund,
Inc.
NOTES
TO
FINANCIAL
STATEMENTS
(Unaudited)(Continued)
June
30,
2022
the
suspension
or
limitation
of
trading.
Fair
valuation
is
based
on
subjective
factors
and,
as
a
result,
the
fair
value
price
of
a
security
may
differ
from
the
security’s
market
price
and
may
not
be
the
price
at
which
the
security
may
be
sold.
Fair
valuation
could
result
in
a
NAV
different
from
one
determined
by
using
market
quotations.
Valuation
inputs
used
to
determine
the
value
of
the
Fund’s
investments
are
summarized
in
the
three
broad
levels
listed
below:
Level
1
-
quoted
prices
in
active
markets
for
identical
assets
Level
2
-
other
significant
observable
inputs
(including
quoted
prices
of
similar
securities,
interest
rates,
prepayment
speeds,
credit
risk,
etc.)
Level
3
-
significant
unobservable
inputs
(including
the
Fund’s
own
assumptions
in
determining
the
fair
value
of
investments)
The
inputs
or
methodology
used
for
valuing
securities
are
not
necessarily
an
indication
of
the
risk
associated
with
investing
in
those
securities.
Pursuant
to
the
valuation
procedures
noted
previously,
equity
securities
(including
exchange-traded
securities
and
other
open-end
regulated
investment
companies)
are
generally
categorized
as
Level
1
securities
in
the
fair
value
hierarchy.
Investments
for
which
there
are
no
quotations,
or
for
which
quotations
do
not
appear
reliable,
are
valued
at
fair
value
as
determined
in
good
faith
by
the
Pricing
Committee
under
the
direction
of
the
Board.
These
valuations
are
typically
categorized
as
Level
2
or
Level
3
in
the
fair
value
hierarchy.
The
following
table
summarizes
the
Fund’s
investments
categorized
in
the
fair
value
hierarchy
as
of
June
30,
2022:
At
June
30,
2022
,
all
equity
securities
and
open-end
regulated
investment
companies
were
included
in
Level
1
in
the
table
above.
Please
refer
to
the
Schedule
of
Investments
to
view
equity
securities
categorized
by
sector/industry
type.
b.
Security
Transactions
Security
transactions
are
recorded
on
a
trade
date
basis.
Realized
gain
and
loss
on
investments
sold
are
recorded
on
the
basis
of
identified
cost.
Dividend
income
is
recorded
on
the
ex-dividend
date.
Interest
income
is
recorded
on
an
accrual
basis.
Foreign
dividend
income
is
recorded
on
the
ex-dividend
date
or
as
soon
as
practicable
after
the
Fund
determines
the
existence
of
a
dividend
declaration
after
exercising
reasonable
due
diligence.
Income
and
capital
gains
on
some
foreign
securities
may
be
subject
to
foreign
withholding
tax,
which
is
accrued
as
applicable.
Investment
income,
realized
and
Security
Type
Level
1
Level
2
Level
3
Total
Investments
in
Securities
Common
Stock
$
970,527,587
$
$
$
970,527,587
Money
Market
Fund
32,236,023
32,236,023
Total
Investments
$
1,002,763,610
$
$
$
1,002,763,610
14
Sound
Shore
Fund,
Inc.
NOTES
TO
FINANCIAL
STATEMENTS
(Unaudited)(Continued)
June
30,
2022
unrealized
gains
and
losses
and
certain
Fund-level
expenses
are
allocated
to
each
class
based
on
relative
average
daily
net
assets.
Certain
expenses
are
incurred
at
the
class
level
and
charged
directly
to
that
particular
class.
Class
level
expenses
are
denoted
as
such
on
the
Fund’s
Statement
of
Operations.
c.
Dividends
and
Distributions
to
Shareholders
Dividends
are
declared
separately
for
each
class.
No
class
has
preferential
dividend
rights;
differences
in
per-share
dividend
rates
are
generally
due
to
class-specific
fee
waivers
and
expenses.
Dividends
and
distributions
payable
to
shareholders
are
recorded
by
the
Fund
on
the
ex-dividend
date.
Dividends
from
net
investment
income,
if
any,
are
declared
and
paid
semiannually.
Capital
gains,
if
any,
are
distributed
to
shareholders
at
least
annually.
The
Fund
determines
its
net
investment
income
and
capital
gains
distributions
in
accordance
with
income
tax
regulations,
which
may
differ
from
GAAP.
These
differences
are
due
primarily
to
differing
treatments
of
income
and
gains
on
various
securities
held
by
the
Fund,
timing
differences
and
differing
characterizations
of
distributions
made
by
the
Fund.
To
the
extent
distributions
exceed
net
investment
income
and
net
realized
capital
gains
for
tax
purposes,
they
are
reported
as
a
return
of
capital.
d.
Federal
Taxes
The
Fund
intends
to
qualify
each
year
as
a
regulated
investment
company
and
to
distribute
substantially
all
of
its
taxable
income.
In
addition,
by
distributing
in
each
calendar
year
substantially
all
of
its
net
investment
income,
capital
gain
and
certain
other
amounts,
if
any,
the
Fund
will
not
be
subject
to
federal
taxation.
Therefore,
no
federal
income
or
excise
tax
provision
is
required.
For
all
open
tax
years
and
all
major
taxing
jurisdictions,
management
of
the
Fund
has
concluded
that
there
are
no
significant
uncertain
tax
positions
that
would
require
the
Fund
to
record
a
tax
liability
or
would
otherwise
require
recognition
in
the
financial
statements.
Open
tax
years
are
those
that
are
open
for
examination
by
taxing
authorities
(i.e.,
generally,
the
last
three
tax
year-ends
2019
2021,
and
the
interim
tax
period
since
then).
3.
Fees
and
Expenses
Investment
Adviser
The
Fund’s
investment
adviser
is
Sound
Shore
Management,
Inc.
(the
“Adviser”).
Pursuant
to
an
investment
advisory
agreement,
the
Adviser
receives
an
advisory
fee,
accrued
daily
and
paid
monthly
at
an
annual
rate
of
0.75%
of
the
Fund’s
average
daily
net
assets.
Pursuant
to
an
expense
limitation
agreement
between
the
Adviser
and
the
Fund,
the
Adviser
has
agreed
to
reimburse
all
of
the
ordinary
expenses
of
the
Institutional
Class,
excluding
advisory
fees,
interest,
taxes,
brokerage
commissions,
acquired
fund
fees
and
expenses,
extraordinary
expenses
and
all
litigation
costs
until
at
least
May
1,
2023.
This
reimbursement
is
shown
on
the
Statement
of
Operations
as
a
reduction
of
expenses,
and
such
amounts
are
not
subject
to
future
recoupment
by
the
Adviser.
Other
Services
Atlantic
Fund
Administration,
LLC,
a
wholly
owned
subsidiary
of
Apex
US
Holdings
LLC
(d/b/a
Apex
Fund
Services)
(“Apex”),
provides
certain
administration
and
portfolio
accounting
services
to
the
Fund.
US
Bank,
N.A.
(“US
Bank”)
serves
as
custodian
to
the
Fund.
Apex
provides
transfer
agency
services
to
the
Fund.
15
Sound
Shore
Fund,
Inc.
NOTES
TO
FINANCIAL
STATEMENTS
(Unaudited)(Continued)
June
30,
2022
The
Fund
also
has
agreements
with
various
financial
intermediaries
and
“mutual
fund
supermarkets”
under
which
customers
of
these
intermediaries
may
purchase
and
hold
Fund
shares.
These
intermediaries
effectively
provide
subtransfer
agent
services
that
the
Fund’s
transfer
agent
would
have
otherwise
had
to
provide.
In
recognition
of
this,
the
transfer
agent,
the
Fund
and
the
Fund’s
Adviser
have
entered
into
an
agreement
whereby
the
transfer
agent
agrees
to
pay
financial
intermediaries
a
portion
of
the
amount
denoted
on
the
Statement
of
Operations
as
“Transfer
agent
fees
and
expenses
Investor
Class
Shares”
that
it
receives
from
the
Fund
for
its
services
as
transfer
agent
for
the
Investor
Class
and
the
Adviser
agrees
to
pay
the
excess,
if
any,
charged
by
a
financial
intermediary
for
that
class.
Foreside
Fund
Services,
LLC
is
the
Fund’s
distributor
(the
“Distributor”).
The
Distributor
is
not
affiliated
with
the
Adviser,
Apex,
US
Bank,
or
its
affiliated
companies.
The
Distributor
receives
no
compensation
from
the
Fund
for
its
distribution
services.
Pursuant
to
a
Compliance
Services
Agreement
with
the
Fund,
Foreside
Fund
Officer
Services,
LLC
(“FFOS”),
an
affiliate
of
the
Distributor,
provides
a
Chief
Compliance
Officer
and
Anti-Money
Laundering
Officer
to
the
Fund
as
well
as
some
additional
compliance
support
functions.
Under
a
Treasurer
Services
Agreement
with
the
Fund,
Foreside
Management
Services,
LLC
(“FMS”),
an
affiliate
of
the
Distributor,
provides
a
Treasurer
to
the
Fund.
Neither
the
Distributor,
FFOS,
FMS,
nor
their
employees
that
serve
as
officers
of
the
Fund,
have
any
role
in
determining
the
investment
policies
of
or
securities
to
be
purchased
or
sold
by
the
Fund.
During
the
period
ended
June,
30,
2022,
the
Fund
paid
each
director
who
is
not
an
“interested
person”
of
the
Fund,
as
defined
in
Section
2(a)(19)
of
the
Act
(“Independent
Director”),
quarterly
fees
of
$5,000,
plus
$10,000
per
quarterly
in-person
meeting,
$4,000
per
quarterly
meeting
attended
telephonically,
and
$2,000
per
special
meeting
attended
in
person
or
telephonically.
In
addition,
the
Chairman
of
the
Audit
Committee
receives
a
quarterly
fee
of
$2,500.
Certain
Officers
and
Directors
of
the
Fund
are
officers,
directors,
or
employees
of
the
aforementioned
companies.
4.
Purchases
and
Sales
of
Securities
The
cost
of
securities
purchased
and
proceeds
from
sales
of
securities
(excluding
short-term
investments)
for
the
period
ending
June
30,
2022,
aggregated
$482,795,810
and
$528,936,787
respectively.
16
Sound
Shore
Fund,
Inc.
NOTES
TO
FINANCIAL
STATEMENTS
(Unaudited)(Continued)
June
30,
2022
5.
Federal
Income
Tax
Cost
for
federal
income
tax
purposes
is
substantially
the
same
as
for
financial
statement
purposes
and
net
unrealized
appreciation
consists
of:
Distributions
during
the
fiscal
years
ended
December
31,
2021
and
December
31,
2020
were
characterized
for
tax
purposes
as
follows:
Components
of
net
assets
on
a
federal
income
tax
basis
at
December
31,
2021,
were
as
follows:
At
December
31,
2021,
the
Fund,
for
federal
income
tax
purposes,
had
no
capital
loss
carryforwards.
6.
Capital
Stock
Transactions
in
capital
stock
for
the
period
ended
June
30,
2022
and
the
year
ended
December
31,
2021,
were
as
follows:
Gross
Unrealized
Appreciation
$
132,557,943
Gross
Unrealized
Depreciation
(84,790,933)
Net
Unrealized
Appreciation
$
47,767,010
2021
2020
Ordinary
Income
$
78,
798
,
207
$
9,759,607
Long-Term
Capital
Gain
19
5,054,864
78,631,157
Total
Taxable
Distributions
$
273,853,071
$
88,390,764
Par
Value
+
Paid-in
Capital
$
94
1
,
672
,
280
Net
Unrealized
Appreciation
3
0
4
,
891
,
775
Net
Assets
$
1,
246
,
564
,
055
For
the
Period
Ended
June
30,
2022
Investor
Class
Institutional
Class
Shares
Amount
Shares
Amount
Sale
of
shares
313,085
$
12,680,282
526,536
$
21,232,911
Reinvestment
of
dividends
70,280
2,430,269
67,003
2,340,409
Redemption
of
shares
(1,280,901)
(51,042,056)
(1,559,789)
(63,509,810)
Net
decrease
from
capital
transactions
(897,536)
$
(35,931,505)
(966,250)
$
(39,936,490)
17
Sound
Shore
Fund,
Inc.
NOTES
TO
FINANCIAL
STATEMENTS
(Unaudited)(Concluded)
June
30,
2022
7.
Risks
As
of
June
30,
2022,
the
Fund
invested
a
significant
portion
of
its
assets
in
securities
in
the
Financials
and
Health
Care
sectors.
Investing
a
significant
portion
of
the
Fund's
assets
in
one
sector
of
the
market
exposes
the
Fund
to
greater
market
risk
and
potential
monetary
losses
than
if
those
assets
were
spread
among
various
sectors.
The
global
outbreak
of
the
COVID-19
virus
has
caused
negative
effects
on
many
companies,
sectors,
countries,
regions,
and
financial
markets
in
general,
and
uncertainty
exists
as
to
its
long-term
implications.
The
effects
of
the
pandemic
may
adversely
impact
the
Fund’s
assets
and
performance.
The
financial
statements
do
not
include
any
adjustments
that
might
result
from
the
outcome
of
this
uncertainty.
8.
Subsequent
Events
Subsequent
events
occurring
after
the
date
of
this
report
have
been
evaluated
for
potential
impact
to
this
report
through
the
date
the
report
was
issued.
Management
has
evaluated
the
need
for
additional
disclosures
and/or
adjustments
resulting
from
subsequent
events.
Effective
July
28,
2022,
the
Fund
pays
each
Independent
Director
quarterly
fees
of
$5,000,
plus
$10,000
per
quarterly
meeting
attended
in
person
or
telephonically,
and
$2,000
per
special
meeting
attended
in
person
or
telephonically.
In
addition,
the
Chairman
of
the
Audit
Committee
receives
a
quarterly
fee
of
$2,500.
For
the
Year
Ended
December
31,
2021
Investor
Class
Institutional
Class
Shares
Amount
Shares
Amount
Sale
of
shares
431,771
$
20,609,970
968,105
$
47,405,245
Reinvestment
of
dividends
3,423,895
141,544,950
2,936,531
122,637,322
Redemption
of
shares
(2,702,428)
(126,889,760)
(2,216,481)
(106,739,750)
Net
in
crease
from
capital
transactions
1,153,238
$
35,265,160
1,688,155
$
63,302,817
18
Sound
Shore
Fund,
Inc.
FINANCIAL
HIGHLIGHTS
These
financial
highlights
reflect
selected
data
for
a
share
outstanding
throughout
each
period
.
Six
Months
Ended
June
30,
2022
(unaudited)
For
the
Year
Ended
December
31,
2021
2020
2019
2018
2017
Investor
Class
Shares
Net
Asset
Value,
Beginning
of
Period
$
41.16‌
$
42.29‌
$
42.41‌
$
37.03‌
$
45.89‌
$
44.17‌
Investment
Operations
Net
investment
income
(a)
0.18‌
0.41‌
0.30‌
0.40‌
0.50‌
0.51‌
Net
realized
and
unrealized
gain
(loss)
on
investments
(6.07‌)
9.66‌
2.90‌
8.20‌
(6.27‌)
6.63‌
Total
from
Investment
Operations
(5.89‌)
10.07‌
3.20‌
8.60‌
(5.77‌)
7.14‌
Distributions
from
Net
investment
income
(0.17‌)
(0.44‌)
(0.32‌)
(0.39‌)
(0.51‌)
(0.52‌)
Net
realized
gains
–‌
(10.76‌)
(3.00‌)
(2.83‌)
(2.58‌)
(4.90‌)
Total
Distributions
(0.17‌)
(11.20‌)
(3.32‌)
(3.22‌)
(3.09‌)
(5.42‌)
Net
Asset
Value,
End
of
Period
$
35.10‌
$
41.16‌
$
42.29‌
$
42.41‌
$
37.03‌
$
45.89‌
Total
Return
(14.
31‌
)%(b)
23.76‌%
7.78‌%
23.26‌%
(12.62‌)%
16.22‌%
Ratios/Supplemental
Data
Net
Assets
at
End
of
Period
(in
thousands)
$541,119‌
$671,380‌
$641,165‌
$853,588‌
$945,244‌
$1,365,922‌
Ratios
to
Average
Net
Assets:
Expenses
0.93‌%(c)
0.93‌%
0.93‌%
0.91‌%
0.90‌%
0.90‌%
Net
Investment
Income
0.90‌%(c)
0.85‌%
0.80‌%
0.95‌%
1.10‌%
1.06‌%
Portfolio
Turnover
Rate
(d)
43‌%(b)
44‌%
77‌%
46‌%
56‌%
44‌%
(a)
Calculated
based
on
average
shares
outstanding
during
each
period.
(b)
Not
annualized.
(c)
Annualized.
(d)
Portfolio
turnover
is
calculated
on
the
basis
of
the
Fund,
as
a
whole,
without
distinguishing
between
the
classes
of
shares
issued.
19
Sound
Shore
Fund,
Inc.
FINANCIAL
HIGHLIGHTS
(Concluded)
These
financial
highlights
reflect
selected
data
for
a
share
outstanding
throughout
each
period
.
Six
Months
Ended
June
30,
2022
(unaudited)
For
the
Year
Ended
December
31,
2021
2020
2019
2018
2017
Institutional
Class
Shares
Net
Asset
Value,
Beginning
of
Period
$
41.56‌
$
42.59‌
$
42.65‌
$
37.19‌
$
46.06‌
$
44.29‌
Investment
Operations
Net
investment
income
(a)
0.21‌
0.51‌
0.37‌
0.47‌
0.58‌
0.60‌
Net
realized
and
unrealized
gain
(loss)
on
investments
(6.12‌)
9.70‌
2.93‌
8.25‌
(6.32‌)
6.64‌
Total
from
Investment
Operations
(5.91‌)
10.21‌
3.30‌
8.72‌
(5.74‌)
7.24‌
Distributions
from
Net
investment
income
(0.18‌)
(0.48‌)
(0.36‌)
(0.43‌)
(0.55‌)
(0.57‌)
Net
realized
gains
–‌
(10.76‌)
(3.00‌)
(2.83‌)
(2.58‌)
(4.90‌)
Total
Distributions
(0.18‌)
(11.24‌)
(3.36‌)
(3.26‌)
(3.13‌)
(5.47‌)
Net
Asset
Value,
End
of
Period
$
35.47‌
$
41.56‌
$
42.59‌
$
42.65‌
$
37.19‌
$
46.06‌
Total
Return
(14.20‌)%(b)
23.95‌%
7.98‌%
23.50‌%
(12.50‌)%
16.40‌%
Ratios/Supplemental
Data
Net
Assets
at
End
of
Period
(in
thousands)
$456,536‌
$575,184‌
$517,449‌
$684,295‌
$721,916‌
$765,297‌
Ratios
to
Average
Net
Assets:
Expenses
(gross)
(c)
0.84‌%(d)
0.83‌%
0.84‌%
0.82‌%
0.81‌%
0.81‌%
Expenses
(net)
0.75‌%(d)
0.75‌%
0.75‌%
0.75‌%
0.75‌%
0.75‌%
Net
Investment
Income
1.08‌%(d)
1.03‌%
0.98‌%
1.12‌%
1.27‌%
1.25‌%
Portfolio
Turnover
Rate
(e)
43‌%(b)
44‌%
77‌%
46‌%
56‌%
44‌%
(a)
Calculated
based
on
average
shares
outstanding
during
each
period.
(b)
Not
annualized.
(c)
Reflects
the
expense
ratio
excluding
any
waivers
and/or
reimbursements.
(d)
Annualized.
(e)
Portfolio
turnover
is
calculated
on
the
basis
of
the
Fund,
as
a
whole,
without
distinguishing
between
the
classes
of
shares
issued.
20
Sound
Shore
Fund,
Inc.
ADDITIONAL
INFORMATION
(Unaudited)
June
30,
2022
Shareholder
Expense
Example
As
a
shareholder
of
the
Fund,
you
incur
ongoing
costs,
including
management
fees
and
other
Fund
expenses.
This
example
is
intended
to
help
you
understand
your
ongoing
costs
(in
dollars)
of
investing
in
the
Fund
and
to
compare
these
costs
with
the
ongoing
costs
of
investing
in
other
mutual
funds.
The
following
example
is
based
on
$1,000
invested
at
the
beginning
of
the
period
and
held
for
the
entire
period
from
January
1,
2022
through
June
30,
2022.
Actual
Expenses
-
The
Actual
Return
lines
of
the
table
below
provide
information
about
actual
account
values
and
actual
expenses
for
each
share
class.
You
may
use
the
information
in
these
lines,
together
with
the
amount
you
invested,
to
estimate
the
expenses
that
you
paid
over
the
period.
Simply
divide
your
account
value
by
$1,000
(for
example,
an
$8,600
account
value
divided
by
$1,000
=
8.6),
then
multiply
the
result
by
the
number
in
the
Actual
Return
line
under
the
heading
entitled
“Expenses
Paid
During
Period”
to
estimate
the
expenses
you
paid
on
your
account
during
this
period.
Hypothetical
Example
for
Comparison
Purposes
-
The
Hypothetical
Return
lines
of
the
table
below
provide
information
about
hypothetical
account
values
and
hypothetical
expenses
based
on
each
class’
actual
expense
ratio
and
an
assumed
rate
of
return
of
5%
per
year
before
expenses,
which
is
not
the
Fund’s
actual
return.
The
hypothetical
account
values
and
expenses
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period.
You
may
use
this
information
to
compare
the
ongoing
cost
of
investing
in
the
Fund
and
other
funds.
To
do
so,
compare
this
5%
hypothetical
example
with
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
other
funds.
Expenses
shown
in
the
table
are
meant
to
highlight
your
ongoing
costs
only
and
do
not
reflect
any
transactional
costs.
Therefore,
the
Hypothetical
Return
lines
of
the
table
are
useful
in
comparing
ongoing
costs
only,
and
will
not
help
you
determine
the
relative
total
costs
of
owning
different
funds.
Beginning
Account
Value
January
1,
2022
Ending
Account
Value
June
30,
2022
Expenses
Paid
During
Period*
Investor
Class
Actual
Return
$
1,000.00
$
856.86
$
4.28
Investor
Class
Hypothetical
Return
$
1,000.00
$
1,020.18
$
4.66
Institutional
Class
Actual
Return
$
1,000.00
$
857.98
$
3.46
Institutional
Class
Hypothetical
Return
$
1,000.00
$
1,021.08
$
3.76
*
Expenses
are
equal
to
the
Investor
Class'
and
Institutional
Class'
annualized
expense
ratios
of
0.93%
and
0.75%
respectively,
multiplied
by
the
average
account
value
over
the
period,
multiplied
by
181/365
to
reflect
the
most
recent
one-half
year
period.
21
Sound
Shore
Fund,
Inc.
ADDITIONAL
INFORMATION
(Unaudited)(Continued)
June
30,
2022
Investment
Advisory
Agreement
Approval
On
January
27,
2022,
the
Independent
Directors
and
the
full
Board
held
a
meeting
and
approved
the
continuance
of
the
Advisory
Agreement.
In
reaching
this
determination,
the
Board
considered
information
about
the
Adviser,
the
performance
of
the
Fund
and
certain
additional
factors
described
below
that
it
deemed
relevant.
The
following
summary
details
the
materials
and
factors
that
the
Board
considered,
among
others,
and
the
conclusions
they
reached,
in
approving
the
continuance
of
the
Advisory
Agreement.
(1)
The
nature,
extent
and
quality
of
services
provided
by
the
Adviser.
The
Board
considered
the
scope
and
quality
of
services
provided
by
the
Adviser,
particularly
the
qualifications,
capabilities
and
experience
of
the
investment,
operational,
compliance,
legal
and
other
personnel
who
are
responsible
for
providing
services
to
the
Fund.
The
Board
also
considered
the
fact
that
the
Adviser
pays
the
costs
of
all
investment
and
management
facilities
necessary
for
the
efficient
conduct
of
its
services
as
well
as
all
distribution
costs
incurred
on
behalf
of
the
Fund
and
all
servicing
costs
to
financial
intermediaries
beyond
the
10
basis
points
borne
by
the
Fund
and
reimbursed
by
the
Fund’s
transfer
agent.
In
addition,
the
Board
considered
that
the
Adviser
manages
the
overall
investment
program
of
the
Fund
and
that
the
Adviser
keeps
the
Board
informed
of
important
developments
affecting
the
Fund,
both
in
connection
with
the
Board’s
annual
review
of
the
Advisory
Agreement
and
at
each
Board
meeting.
The
Board
evaluated
these
factors
based
on
its
direct
experience
with
the
Adviser,
and
in
consultation
with
Counsel
to
the
Fund
and
Counsel
to
the
Independent
Directors.
The
Board
also
considered
the
Adviser’s
effectiveness
in
ensuring
that
the
Fund
remains
in
compliance
with
its
investment
policies
and
restrictions
and
the
requirements
of
the
1940
Act
and
related
securities
regulations.
The
Board
further
noted
the
Adviser’s
efforts
to
oversee
the
Fund’s
other
service
providers,
including
those
providing
administrative,
accounting
and
custodial
services.
Based
on
these
factors,
as
well
as
other
factors
discussed
at
the
Meeting,
the
Board
concluded
that
the
nature,
extent
and
quality
of
services
provided
by
the
Adviser
have
been
and
continue
to
be
satisfactory.
(2)
The
performance
of
the
Fund
and
the
Adviser.
The
Board’s
analysis
of
the
Fund’s
performance
included
the
discussion
and
review
of
the
performance
data
of
the
Fund
against
securities
benchmarks
as
well
as
against
a
group
of
comparable
funds,
based
on,
in
part,
information
provided
by
an
independent,
third-party
mutual
fund
data
provider
Strategic
Insight,
Inc.
(“Strategic
Insight”)
engaged
by
the
Board
for
this
purpose.
The
Board
also
considered
the
performance
of
the
Fund
against
a
comparative
universe
of
similar
funds
as
identified
by
the
Adviser.
The
Board
reviewed
comparative
performance
over
long-,
intermediate-
and
short-term
periods.
In
reviewing
performance,
the
Board
placed
greater
emphasis
on
longer-term
performance
than
on
shorter-term
performance,
taking
into
account
that
over
short
periods
of
time
underperformance
may
be
transitory.
The
Board
further
took
into
account
that
performance
returns
over
longer
periods
can
be
impacted
dramatically
by
the
end
point
date
from
which
performance
is
measured.
In
this
regard
the
Board
observed
that
the
Fund
underperformed
the
Russell
1000
Value
Index,
the
Fund’s
primary
benchmark,
over
the
one-
and
five-year
periods
ended
December
31,
2021,
and
outperformed
the
primary
benchmark
index
22
Sound
Shore
Fund,
Inc.
ADDITIONAL
INFORMATION
(Unaudited)(Continued)
June
30,
2022
over
the
three-,
10-,
and
30-year
periods
ended
December
31,
2021.
The
Board
also
observed
that
the
Fund’s
Investor
Class
Shares
underperformed
the
primary
benchmark
index
over
the
20-year
period
ended
December
31,
2021,
and
the
Fund’s
Institutional
Class
Shares
outperformed
the
primary
benchmark
index
over
the
same
20-year
period.
The
Board
also
considered
the
performance
of
the
Fund
in
the
context
of
whether
the
Fund
was
meeting
the
expectations
of
the
clients
invested
in
the
Fund.
The
Board
also
considered
the
performance
of
the
Fund
against
similarly
managed
accounts
managed
by
the
Adviser.
When
reviewing
performance
against
similarly
managed
accounts,
the
Board
considered,
among
other
things,
differences
in
the
nature
of
such
accounts
from
a
regulatory
and
tax
perspective
and
differences
in
the
investment
mandate
from
that
of
the
Fund.
The
Board
considered
the
Adviser’s
view
as
to
the
principle
drivers
of
Fund
performance.
Based
on
these
factors,
as
well
as
other
factors
discussed
at
the
Meeting,
the
Board
concluded
that
the
performance
of
the
Fund
and
the
Adviser
has
been
and
continues
to
be
satisfactory.
(3)
The
cost
of
the
advisory
services
and
the
profits
to
the
Adviser
from
the
relationship
with
the
Fund.
The
Board’s
consideration
of
the
Fund’s
advisory
fee
and
expenses
included,
among
other
factors,
a
discussion
and
review
of
data
concerning
the
current
advisory
fee
and
expense
ratio
of
the
Fund
compared
to
a
peer
group
of
funds
identified
by
Strategic
Insight
as
having
characteristics
similar
to
those
of
the
Fund.
The
Board
observed
that,
although
the
Fund’s
advisory
fee
rate
was
higher
than
the
median
of
the
Strategic
Insight
peers,
the
Fund’s
net
expense
ratio
met
the
median
of
the
Strategic
Insight
peers.
The
Board
also
considered
that
the
Institutional
Class
shares
have
a
lower
expense
ratio
than
the
Investor
Class
shares
because
the
Adviser
has
capped
expenses
at
75
basis
points
to
compete
in
the
institutional
market.
Additionally,
the
Board
considered
advisory
fee
data
from
the
Adviser’s
similarly
managed
accounts
and
considered
the
relevance
of
differences
in
the
services
provided
to
separate
accounts
as
they
relate
to
differences
in
the
advisory
fees
charged
in
connection
with
management
of
the
Fund.
The
Board
also
considered
the
profitability
of
the
Fund
to
the
Adviser.
In
this
regard,
the
Board
noted
that
the
Fund,
with
an
advisory
fee
of
75
basis
points
and
assets
of
approximately
$1.2
billion,
did
not
appear
to
generate
“excessive”
fees
to
the
Adviser.
Based
on
this
analysis,
the
Board
concluded
that
the
advisory
fee
for
the
Fund
was
fair
and
reasonable
in
light
of
the
quality
of
services
provided
by
the
Adviser.
(4)
The
extent
to
which
economies
of
scale
will
be
realized
as
the
Fund
grows
and
whether
fee
levels
reflect
those
economies
of
scale.
The
Board
considered
whether
the
Fund
could
benefit
from
any
economies
of
scale.
In
this
regard,
the
Board
considered
the
Fund’s
fee
structure,
asset
size,
net
expense
ratio,
and
the
fees
of
comparable
advisers,
recognizing
that
an
analysis
of
economies
of
scale
is
most
relevant
when
a
fund
has
achieved
a
substantial
size
and
has
growing
assets
and
that,
if
a
fund’s
assets
are
stable
or
decreasing,
the
significance
of
economies
of
scale
may
be
reduced.
The
Board
reviewed
relevant
materials
and
discussed
whether
the
use
of
breakpoints
would
be
appropriate
at
this
time.
Noting
the
relatively
stable
asset
levels
in
the
Fund
over
the
23
Sound
Shore
Fund,
Inc.
ADDITIONAL
INFORMATION
(Unaudited)(Concluded)
June
30,
2022
past
year
and
the
existence
of
the
Adviser’s
ongoing
expense
limitation
arrangements,
the
Board
concluded
that
the
advisory
fee
remained
reasonable
in
light
of
the
current
information
provided
to
the
Board
with
respect
to
economies
of
scale.
(5)
Ancillary
benefits
and
other
factors.
In
addition
to
the
above
factors,
the
Board
also
discussed
other
benefits
received
by
the
Adviser
from
the
management
of
the
Fund,
such
as
soft-dollar
credits.
The
Board
concluded
that
the
advisory
fee
was
reasonable
in
light
of
these
fall-out
benefits.
Conclusion
The
Board,
including
all
of
the
Independent
Directors,
concluded
that
the
fees
payable
under
the
Advisory
Agreement
were
fair
and
reasonable
with
respect
to
the
services
that
the
Adviser
provides,
in
light
of
the
factors
described
above
that
the
Board
deemed
relevant.
The
Board
based
its
decision
on
an
evaluation
of
all
these
factors
as
a
whole
and
did
not
consider
any
one
factor
as
all-important
or
controlling.
The
Independent
Directors
were
also
assisted
by
the
advice
of
Counsel
to
the
Independent
Directors
in
making
this
determination.
Proxy
Voting
Information
A
description
of
the
policies
and
procedures
that
the
Fund
uses
to
determine
how
to
vote
proxies
relating
to
securities
held
in
the
Fund’s
portfolio
is
available,
without
charge
and
upon
request,
by
calling
(800)
551-1980
or
by
visiting
the
Fund’s
website
at
http://www.soundshorefund.com.
This
information
is
also
available
on
the
Securities
and
Exchange
Commission’s
(“SEC”)
website
at
http://www.sec.gov
under
the
name
of
the
Sound
Shore
Fund.
The
Fund’s
proxy
voting
record
for
the
most
recent
12-month
period
ended
June
30
is
available,
without
charge
and
upon
request,
by
calling
(800)
551-1980
or
by
visiting
the
Fund’s
website
at
http://www.soundshorefund.com.
This
information
is
available
on
the
SEC’s
website
at
http://www.sec.gov
under
the
name
of
the
Sound
Shore
Fund.
Availability
of
Quarterly
Portfolio
Schedule
The
Fund
files
its
complete
schedule
of
portfolio
holdings
with
the
SEC
for
the
first
and
third
quarters
of
each
fiscal
year
on
Form
N-PORT.
This
information
is
available
on
the
SEC’s
website
at
http://www.sec.gov
under
the
name
of
the
Sound
Shore
Fund.
Investment
Adviser
Sound
Shore
Management,
Inc.
Greenwich,
Connecticut
Administrator
Apex
Fund
Services
Portland,
Maine
Distributor
Foreside
Fund
Services,
LLC
Portland,
Maine
www.foreside.com
Transfer
and
Distribution
Paying
Agent
Apex
Fund
Services
Portland,
Maine
Custodian
US
Bank,
N.A.
Milwaukee,
Wisconsin
Fund
Counsel
Sullivan
and
Worcester
LLP
New
York,
New
York
Independent
Registered
Public
Accounting
Firm
BBD,
LLP
Philadelphia,
Pennsylvania
Semi-Annual
Report
to
Shareholders
(Unaudited)
June
30,
2022
207-SAR-0622
This
report
is
submitted
for
the
general
information
of
the
shareholders
of
the
Fund.
It
is
not
authorized
for
distribution
to
prospective
investors
in
the
Fund
unless
preceded
or
accompanied
by
an
effective
prospectus,
which
includes
information
regarding
the
Fund’s
objectives
and
policies,
experience
of
its
management,
and
other
information.
SOUND
SHORE
FUND,
INC.
Three
Canal
Plaza
Portland,
ME
04101
http://www.soundshorefund.com
(800)
551-1980
 
 
 
Item 2. Code of Ethics.
Not applicable.
 
Item 3. Audit Committee Financial Expert.
Not applicable.
 
Item 4. Principal Accountant Fees and Services.
Not applicable.
 
Item 5. Audit Committee of Listed Registrants.
Not applicable.
 
Item 6. Schedule of Investments.
(a)
Included as part of the report to stockholders under Item 1.
 
(b)
Not applicable.
 
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
 
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
 
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
 
Item 10. Submission of Matters to a Vote of Security Holders.
Not applicable.
 
Item 11. Controls and Procedures.
 
(a) The registrant’s principal executive officer and principal financial officer concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”)) were effective as of a date within 90 days of the filing date of this report (the “Evaluation Date”) based on their evaluation of the registrant’s disclosure controls and procedures as of the Evaluation Date.
 
(b) There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
 
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not applicable.
 
Item 13. Exhibits.
(a)(1) Not applicable.
 
(a)(2) Certifications pursuant to Rule 30a-2(a) of the Investment Company Act of 1940 as amended, and Section 302 of the Sarbanes-Oxley Act of 2002 (Exhibit filed herewith).
 
(a)(3) Not applicable.
 
(b) Certifications pursuant to Rule 30a-2(b) of the Investment Company Act of 1940, as amended, and Section 906 of the Sarbanes-Oxley Act of 2002 (Exhibit filed herewith).

SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
SOUND SHORE FUND, INC.
 
By
/s/ T. Gibbs Kane, Jr.
 
 
T. Gibbs Kane, Jr., President
 
 
 
 
Date
08/04/2022
 
 
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
 
By
/s/ T. Gibbs Kane, Jr.
 
 
T. Gibbs Kane, Jr., President
 
 
 
 
Date
08/04/2022
 
 
By
/s/ Charles S. Todd
 
 
Charles S. Todd, Treasurer
 
 
 
 
Date
08/04/2022
 
 
 

Exhibit 1A

Sound Shore Fund, Inc.

 
 
I, T. Gibbs Kane, Jr., certify that:
 
1.
      
I have reviewed this report on Form N-CSR of Sound Shore Fund, Inc. (the “registrant”);
 
2.
      
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
3.
      
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
 
4.
      
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
 
(a)
    
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
(b)
   
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
(c)
    
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and
 
(d)
   
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
 
5.
      
The registrant’s other certifying officer and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
 
(a)
    
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
 
(b)
   
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
 
Date:
08/04/2022
 
/s/ T. Gibbs Kane, Jr.
 
 
 
T. Gibbs Kane, Jr.
 
 
 
President
 

Exhibit 1B

Sound Shore Fund, Inc.

 
 
I, Charles S. Todd, certify that:
 
1.
      
I have reviewed this report on Form N-CSR of Sound Shore Fund, Inc. (the “registrant”);
 
2.
      
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
3.
      
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
 
4.
      
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
 
(a)
    
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
(b)
   
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
(c)
    
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report, based on such evaluation; and
 
(d)
   
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
 
5.
      
The registrant’s other certifying officer and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
 
(a)
    
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
 
(b)
   
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
 
Date:
08/04/2022
 
/s/ Charles S. Todd
 
 
 
Charles S. Todd
 
 
 
Treasurer
 

Exhibit 2
 
Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code)
 
This certification is provided pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. § 1350, and accompanies the report on Form N-CSR for the period ended June 30, 2022 of Sound Shore Fund, Inc. (the “Registrant”).
Each of the undersigned, being the Principal Executive Officer and Principal Financial Officer of the Registrant, hereby certifies that, to such officer’s knowledge:
 
1.
      
The Form N-CSR fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78m(a) or 78o(d)); and
 
2.
      
The information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant.             
                                               
Dated:
08/04/2022
 
 
 
 
 
/s/ T. Gibbs Kane, Jr.
 
 
T. Gibbs Kane, Jr.
 
 
President
 
 
 
 
Dated:
08/04/2022
 
 
 
 
 
/s/ Charles S. Todd
 
 
Charles S. Todd
 
 
Treasurer
 
 
A signed original of this written statement required by Section 906 has been provided to the Trust and will be retained by the Trust and furnished to the Securities and Exchange Commission or its staff upon request.