“If you buy stocks that have been doing well, it seems like they’re priced for perfection — fully or even overvalued,” he said. “But even the best companies can have periods of difficulty.” That’s when Mr. Dodson hopes to snag them.

Lately, for example, Endeavor has benefited from its ownership of semiconductor companies, like Applied Materials and Lam Research.

“Some of those tend to be cyclical,” he said, meaning their prices wax and wane with macroeconomic trends, even as long-term demand for their products endures. “That lets me buy the stocks when the prices are down,” he added. Mr. Dodson’s fund has an annual turnover ratio of 71 percent, according to Morningstar.

In picking stocks, Mr. Dodson and his co-manager, Billy Hwan, evaluate not only a company’s financial strength but also its environmental, social and governance performance. That dual approach applies to all the funds managed by Parnassus, which Mr. Dodson started in San Francisco in 1984. For Endeavor, in particular, the managers want outfits known as standout workplaces.

“If a company is a good place to work, you’re going to get highly motivated workers,” Mr. Dodson said. “They’re going to work harder. You should also have less turnover.”