Since the number of funds we can cover in-depth is smaller than the number of funds worthy of in-depth coverage, we’ve decided to offer one or two managers each month the opportunity to make a 200 word pitch to you. That’s about the number of words a slightly-manic elevator companion could share in a minute and a half. In each case, I’ve promised to offer a quick capsule of the fund and a link back to the fund’s site. Other than that, they’ve got 200 words and precisely as much of your time and attention as you’re willing to share. These aren’t endorsements; they’re opportunities to learn more.
Colin Symons manages SAVIX and has managed it since the fund launched in 2006. He joined Symons Capital, the advisor, in 1997. He seems to be a serial over-achiever. Mr. Symons graduated from Williams College, arguably the best liberal arts college in America, in only three years. He started his career as a software developer, working with and writing code for both the IRS and major financial services firms such as Chase Manhattan Bank. He eventually earned recognition as a Microsoft Certified Solution Developer, a globally recognized designation. His interests grew beyond financial software into financials; he learned security analysis and earned his CFA. At Symons Capital he manages $378 million in their Value, Small Cap Value and Concentrated Small Cap Value strategies. Symons itself manages about a half billion dollars in client assets.
Symons Value came to our attention preparing the article, “Counting on the Winners” (November, 2016). In it we looked for equity funds that managed exceptionally strong risk-adjusted returns in both the market panic (2007-09) and in the subsequent bull market (2009-present). Of the 3000 funds we screened, SAVIX was one of ten stand-outs. It had sterling performance in the crisis then subsequently posted respectable absolute returns with exceptionally low volatility. The table below reflects the fund’s performance over the course of the current bull market cycle.
|
|
Annual returns |
Maximum drawdown |
Downside deviation |
Bear market deviation |
Sharpe ratio |
|
Symons Value |
11% |
8.8% |
4.8% |
3.3% |
1.13 |
|
Lipper peer group |
16 |
21 |
8.2 |
7.2 |
1.07 |
Here’s the translation: during the bull market begun in March 2009, SAVIX has returned about 69% as much as its average peer but it’s worst drawdown was only 42% as great, its downside volatility is 58% as great and its losses in bear market months is 46% as great. In short, you would have received 70% of the gain with only 50% of the pain. That’s a pleasantly asymmetrical risk-return ratio.
It has earned the Observer’s “Great Owl Fund” designation for top-tier risk-adjusted returns in every trailing measurement period since inception.
We asked Mr. Symons about the fund’s very consistent strength. Here are Colin’s 200 words on why you should add SAVIX to your due-diligence list:
We think of ourselves as risk managers, guys who limit volatility in the near-term in order to produce the strongest returns in the long-term. Generally the goal is to get there, but to sort of get there safely. While we’re fairly risk-averse we’re also perfectly happy taking intelligent risks, but still protecting against the downside. In gaming terms, we’re not going to put it all on black. It’s how I manage my own money and it works.
There are four pillars of investing: macro, fundamental, technical, sentiment. Our special strength is understanding the significance of macro-level events on the likely performance of individual securities. The macro side stuff tends to focus on growth prospects. The question we look at is, is it likely to get better or to get worse? The US is a pretty developed country with a rich set of data available. We look at the prospects for the economy and various sectors, then adjust. If things are slowing, we might move to consumer staples and utilities; if it’s accelerating, we would turn to cyclicals. Beyond that, fundamentals are fundamentals. Graham and Dodd stuff. We’re good at it but it’s not a real differentiator. Sentiment and technicals can move the picture, but they don’t really contribute much to it.
That focus on the macro helps explain our ability to manage volatility. If growth is slowing, we may run from financials or maybe retail. Most of Wall Street isn’t willing to do that. The questions are always the same, what’s the upside from here and how well do we know the risks?
Symons Value has a $5000 minimum initial investment which is reduced to $2500 for IRAs and other types of tax-advantaged accounts. Expenses are capped at 1.21% through May, 2018. The fund has about gathered about $92 million in assets. Here’s the fund’s homepage. As is so often the case, there’s rather more sophisticated information available on the advisor’s site. The key is to remember that the separate account information might help inform your understanding of the fund but can’t substitute for a careful analysis of the fund literature itself.
