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  • msf August 2012
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Cortina mutual funds

edited August 2012 in Fund Discussions
Anyone have any insight into the two Cortina Mutual funds? There is a small cap growth and small cap value fund. Reasonable fees. $2500 min with Fidelity, not $100,000.

Comments

  • Hard to find redeeming values, beyond "wait and see".

    The two funds are not symmetric in approach - the growth says that it uses top down ("theme-based") investing, which is exceptionally rare in mutual funds, while the value fund does not. Perhaps as a consequence, the growth fund limits sector exposure to double its benchmark exposure, while the value fund does not.

    The management base fee is 1.0% (a tad high, but not too bad); the 1.1% expense ratio is because of waivers/reimbursements that are reviewed annually (Dec 31).

    The main problem is lack of experience. Don't know much about the support team.

    On the value side, the manager has only $2M AUM including two private accounts. The prospectus says that he was previously a portfolio manager at Morgan Stanley, but doesn't say what he managed. This lack of disclosure makes me nervous. I had to go to M* to find that he had managed Invesco Van Kampen SCV (VSCAX) from 2/3006 to 7/2010. Turns out he had a pretty good to excellent record (always top half, usually top quintile).

    On the growth side, the co-managers have at least been managing private assets for Cortina since 2004 (its founding). That now totals $250M AUM (12 private accounts) - not a huge amount, but at least real money. The prospectus statement of how those private accounts did (on average) is very good, but comes with the usual qualifications that managing private accounts is not the same as managing a mutual fund, that the expenses on private accounts are lower, etc. So, while there's some data to go by, it's still pretty limited.

    Here, the problem in finding past fund records is the reverse of the value fund. The prospectus lists a prior fund for one of the co-managers (Brian Bies), while M* comes up empty. That fund is listed as First American Small Cap Growth Opportunities (FMPYX) (formerly Firstar MicroCap, and subsequently Nuveen Small Cap Growth Opp), where he served on the management team from 11/2002 to 3/2004 (when he apparently left to co-found Cortina). Curiously, the First American Prospectus says only that the fund's advisor was US Bankcorp (Bies worked for them), without naming individuals. That's already more digging than this is worth.

    My bottom line is that I don't see enough information,or experience to go on now.
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