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Reply to @andrei: AAII Shadow Portfolio aside, Micro-Cap Funds have had an excellent long-term performance along with other (SCG) Funds. A couple examples: PRCGX, PREOX, OBMCX. Regards, Ted
Picking a good Micro-cap stock is tricky though and you have to be really really patient.
I don't think OBMCX would be something for me - extremely streaky. 5% annual returns the past 10 years and since 1998 to today - about 15 years - the Vanguard Midcap Index and SPDR Midcap Index have both beaten OBMCX.
A couple of other growth micro-cap funds were not included: SATMX (formerly Satuit Micro-cap fund and TMCGX (formerly Turner Micro-cap fund). For value plays, PVFIX.
As I see it, exposure to microcaps is essential in a well diversified portfolio due to their diversification and performance benefits. From articles that I have read, a 5-10% exposure is just about right. Here is a decent article describing the benefits of investing in microcaps:
In our portfolio, we continue to cover our microcap needs with a 7% allocation to WEIMX, which has the most attractive risk-reward profile in the space. Yes it is bloated and should close to new investors, but for now, it remains my most attractive option.
Continue to recommend THBVX in this space.True micro-cap with lower turnover rate than most.For the beginner or young investor, a great opportunity @ Fidelity ,$100 initial and $25 subsequent in any acct. Sshh! A secret.Like the old days!
Although very young, THVBX (ER 1.75%) looks like an attractive fund. Depending on the size of investment, I would strongly consider buying the much lower cost institutional class, THBIX (ER 1.25%), which is available in retirement accounts at Fidelity (no minimum + TF) and Scottrade ($2500 minimum + TF) according to the web sites.
Reply to @varmint: I also own BRUSX since BRMCX was reorganized into BRUSX. I took the option of getting into the fund since I missed it the first time and continue to invest in it prior to it having another "hard" close.
You are lucky to have stuck with it for all of that time. Problem with micro-caps is that eventually the build-up of capital gains will have to be paid. WAMVX, TMCGX, SATMX and BRUSX had/will have large payouts this year.
"...Satuit's three U.S. domestic focused equity strategies, Satuit Capital U.S. Emerging Companies Fund (SATMX), Satuit Capital U.S. Small Cap Fund (SATSX) and Satuit Capital U.S. SMID Cap Fund (SATDX) "are focused on U.S. domestic equity securities," states Mr. Sullivan. "Our flagship fund, SATMX, has a 13 year track record and consistently ranks as one of the better long term performing small cap growth strategies. The strategy has $190 million of assets. We do not expect to close the fund till $750m of assets..."
Comments
http://www.azcentral.com/business/abg/free/20130207insist-seeing-proof-performance-claims.html
Regards,
Ted
I don't think OBMCX would be something for me - extremely streaky. 5% annual returns the past 10 years and since 1998 to today - about 15 years - the Vanguard Midcap Index and SPDR Midcap Index have both beaten OBMCX.
http://www.alphaonecapital.com/ac/ac.nsf/0/966339444FAB80B4862578CC0052F37B/$FILE/AlphaOne_Micro_Cap_Whitepaper.pdf
In our portfolio, we continue to cover our microcap needs with a 7% allocation to WEIMX, which has the most attractive risk-reward profile in the space. Yes it is bloated and should close to new investors, but for now, it remains my most attractive option.
Kevin
http://portfolios.morningstar.com/fund/summary?t=THBVX®ion=USA&culture=en-US
Not much info @ P M's web-site,but top 10 holdings are updated regularly here:
http://aicfundholdings.com/holdings_home.asp?BTMAction=GET_FUND_HOLDINGS&complexid=1&advisorid=407&fundid=20627&holdings=TOP_TEN&sort=PERCENT_OF_PORTFOLIO&fund_name=Thomson+Horstmann+&+Bryant+Microcap+Fund&rundate=0
Portfolio Manager Web-site;
http://www.thbinc.com/about/index.aspx.html
Although very young, THVBX (ER 1.75%) looks like an attractive fund. Depending on the size of investment, I would strongly consider buying the much lower cost institutional class, THBIX (ER 1.25%), which is available in retirement accounts at Fidelity (no minimum + TF) and Scottrade ($2500 minimum + TF) according to the web sites.
Kevin
You are lucky to have stuck with it for all of that time. Problem with micro-caps is that eventually the build-up of capital gains will have to be paid. WAMVX, TMCGX, SATMX and BRUSX had/will have large payouts this year.
http://www.prnewswire.com/news-releases/got-us-small-cap-exposure-advisors-rush-to-invest-in-small-cap-funds-before-they-close-219923481.html?advisorid=408164
Excerpt from article:
"...Satuit's three U.S. domestic focused equity strategies, Satuit Capital U.S. Emerging Companies Fund (SATMX), Satuit Capital U.S. Small Cap Fund (SATSX) and Satuit Capital U.S. SMID Cap Fund (SATDX) "are focused on U.S. domestic equity securities," states Mr. Sullivan. "Our flagship fund, SATMX, has a 13 year track record and consistently ranks as one of the better long term performing small cap growth strategies. The strategy has $190 million of assets. We do not expect to close the fund till $750m of assets..."