FPA Queens Road Small Cap Value Fund Institutional Class · NASDAQ:QRSIX
FPA Queens Road Small Cap Value Fund Institutional Class — First Pacific Advisors — Investor Day (May 2024)
78 slides from FPA Queens Road Small Cap Value Fund Institutional Class's investor day presentation, May 22, 2024
Slide 1: FPA Investor Day, May 22, 2024
L P rs, is o d v c A i f i a c t P rs May 22, 2024 i Email Questions to crm@fpa.com F
Slide 2: Welcome!
L P rs, is o d v c A WELCOME! ci f i P a rs t F i 2
Slide 3: Important disclosures
Important disclosures P This document is for informational purposes only. This document may not be reproduced or distributed in any format without the prior written approval of First Pacific Advisors, LP (“FPA”). The information provided is as of the date on the Cover page and is subject to change.
Slide 4: Agenda
Agenda L P rs, is o d v c A i f i ac t P F i rs 4
Slide 5: Event speakers
Event speakers Steven Romick Abhi Patwardhan L P First Pacific Advisors Portfolio Manager rs, First Pacific Advisors Portfolio Manager FPA Crescent Fund FPA Global Equity ETF is o FPA New Income Fund FPA Flexible Fixed Income Fund v Source Capital, Inc. Source Capital, Inc. Ad i f i c c Brian Selmo
Slide 6: Results: a meaningful, measurable track record of success
Results A meaningful, measurable track record of success ■ 100% of the Firm’s public funds are 4- or 5-star rated L P Source Capital, Inc. Fund Morningstar Overall Rating , Morningstar Medalist Rating rs FPA Queens Road Small Cap Value Fund is o FPA Queens Road Value Fund d v FPA Crescent Fund c A F
Slide 7: Morningstar Medalist Rating Results
Morningstar Medalist Rating Results Average Excess Return (vs Morningstar Category Average) by Morningstar Medalist Rating for Uncovered U.S. Funds Since Inception of Morningstar’s Quantitative System L P rs, is o d v c A i f i a c t P F i rs Source: Morningstar. Chart data covers the period July 1,
Slide 8: Looking ahead: our commitment to you
Looking ahead: our commitment to you L P , Strive to provide: ors v is A meaningful, measurable track A d Investors First Capacity discipline, Peace of mind Downside record of success i f i c eat our own protection / look over the long-term a c cooking, always open to feedback / down before looking
Slide 9: What's new at FPA
What’s new at FPA ■ FPA Crescent Fund 30th anniversary in 2023 L P ■ rs, FPA New Income Fund 40th anniversary this July! is o ■ v FPA Global Equity ETF celebrates 3-year anniversary at year-end d ■ A Managing Partner Rich Atwood retiring at end of year after four-decade c relationship with firm i f
Slide 10: FPA Crescent Fund
L P rs, is o d v c A FPA Crescent Fund i f i c With Steven Romick and Brian Selmo a t P F i rs 10
Slide 11: FPA Crescent Fund performance
FPA Crescent Fund performance P Market Cycle Trailing Performance (%) Performance As of Date: 3/31/2024 Inception* 30 Years 20 Years 15 Years 10 Years 5 Years 3 Years 1 Year , YTD QTD L 3/25/00- 10/10/07- 1/4/22- 10/9/07 1/3/22 3/31/24 rs FPA Crescent Fund (FPACX) 9.99 9.88 8.04 10.23 7.53 10.10 6.6
Slide 12: FPA Crescent Fund performance (annual)
FPA Crescent Fund performance P Annual Performance (%)* L 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 , FPA Crescent Fund (FPACX) 20.27 -9.20 15.17 12.11 20.02 -7.43 10.39 10.25 -2.06 6.64 MSCI ACWI** 22.20 -18.36 18.54 16.25 26.60 -9.41 23.97 7.86 -2.36 4.16 rs S&P 500 26.29 -18.11 28.71 18.4
Slide 13: FPA Crescent Fund mandate
FPA Crescent Fund mandate Investment objective: The FPA Crescent Fund seeks to generate equity-like returns over the long- term, take less risk than the market and avoid permanent impairment of capital. L P ■ Flexible approach rs, o ‒ We utilize a go-anywhere approach with a broad mandate allowing u
Slide 14: Positive rolling 5-year returns
Positive rolling 5-year returns Worst Return in a Trailing 5-Year Period L P 1.00% rs, is o d v-2.26% c A -3.38% i f i a c -6.63% FPA Crescent Fund t P S&P 500 60% S&P 500 / 40% Morningstar Bloomberg US Agg Moderately Aggressive Allocation Category F i rs Source: Morningstar. Fund returns are shown
Slide 15: Shorter recovery time than index and peers
Shorter recovery time than index and peers Max Recovery Time (in Years) L P 6.1 rs, is o 4.9 d v 3.5 1.8 c A i f i FPA Crescent Fund a c S&P 500 60% S&P 500 / 40% Morningstar t P Bloomberg US Agg Moderately Aggressive Allocation Category F i rs Source: Morningstar. The chart illustrates the max reco
Slide 16: 5- and 10-Year performance
5- and 10-Year performance As of Date: 3/31/24 5 Years P 10 Years L , FPA Crescent Fund 10.10% 7.53% MSCI ACWI** o 10.92% rs 8.66% is 60% MSCI ACWI** / 40% BBg US Agg 6.89% 6.00% Average Net Risk Exposure d v 73.4% 67.5% c A f i Past performance is no guarantee, nor is it indicative, of future resul
Slide 17: FPA New Income Fund and FPA Flexible Fixed Income Fund
L P rs, is o d v FPA New Income Fund c A i f i c FPA Flexible Fixed Income Fund a P With Abhi Patwardhan t F i rs 17
Slide 18: FPNIX performance – net of fees
FPNIX performance – net of fees L P ITD (Since , As of Date: 3/31/2024 QTD 1 Year 3 Years 5 Years 10 Years 15 Years 20 Years 30 Years 7/11/84) rs FPA New Income Fund (“FPNIX”) 0.86 6.29 1.81 2.19 2.05 2.08 2.53 4.09 6.21 Bloomberg U.S. Agg Bond Index -0.78 1.70 -2.46 0.36 1.54 2.62 2.99 4.49 6.29 CP
Slide 19: FPNIX performance – annual
FPNIX performance – net of fees Annual Performance (%) 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 FPA New Income Fund (“FPNIX”) 7.51 -3.10 0.82 2.51 3.81 2.30 2.67 2.53 0.15 1.32 0.67 2.18 2.23 3.18 2.89 4.31 L P 6.02 4.79 1.57 2.60 Bloomberg
Slide 20: FPFIX performance – net of fees
FPFIX performance – net of fees ITD (Since L P , As of Date: 3/31/2024 QTD YTD 1 Year 3 Years 5 Years 12/31/18) rs FPA Flexible Fixed Income Fund (“FPFIX”) 1.17 1.17 7.87 2.69 3.25 3.30 Bloomberg U.S. Universal Index -0.47 -0.47 2.67 -2.11 0.69 1.28 CPI + 200 1.63 1.63 5.56 is o 7.75 6.27 6.18 d v c
Slide 21: FPFIX performance – annual
FPFIX performance – net of fees L P , Annual Performance (%) 2023 2022 2021 2020 2019 rs FPA Flexible Fixed Income Fund (“FPFIX”) 9.02 -2.82 1.77 4.70 3.78 Bloomberg U.S. Universal Index 6.17 -12.99 -1.10 7.58 9.29 CPI + 200 5.38 8.58 is o 9.35 3.36 4.38 d v c A i f i Past performance is no guarante
Slide 22: Fund overview
Fund overview P FPA New Income Fund FPA Flexible Fixed Income Fund Institutional Class (FPNIX) Institutional Share Class (FPFIX) Investor Share Class (FPNRX) FPA New Income Fund seeks to provide long-term total , L Advisor Share Class (FFIAX) FPA Flexible Fixed Income Fund seeks to provide long-term
Slide 23: Active duration management: upside versus downside
Active duration management: illustration of upside versus downside 12.00% Hypothetical 12-month U.S. Treasury Returns L P 10.00% rs, 9.63 o 7.94 8.00% 7.13 is 6.33 5.02 5.59 6.00% v 5.24 5.02 5.02 4.62 4.41 4.30 4.21 4.21 4.10 4.00% 2.00% 0.38 0.73 1.73 0.96 2.96 1.11 1.26 A d 3.66 2.54 1.56 c 0.38
Slide 24: Active management
Active management ■ FPA New Income and FPA Flexible Fixed Income are actively adding duration L P rs, Effective duration 12/31/2021 is o 3/31/2024 Change (yrs.) v FPA New Income Fund 1.39 3.04 +1.65 Morningstar U.S. Short-Term Bond Category Bloomberg U.S. 1-3 Yr Aggregate Bond Index A 2.75 1.92 d 2.
Slide 25: Assessing credit risk
Assessing credit risk 200 Bond Value L P , 180 160 rs Margin of $ Bond Value 140 120 Safety o 100 80 Bond is 60 Loss 40 v 20 0 d 0 20 40 60 80 100 120 140 160 180 200 $ Business or Asset Value c A Industry evaluation ■ Cyclicality Fundamentals ■ Capital structure and i f i Qualitative evaluation ■ W
Slide 26: Attractive long-term performance with a smoother ride (FPNIX)
The ultimate goal is attractive long-term performance with a smoother ride $14,000 FPA New Income growth of $10,000 over ten years FPA New Income L P , Bloomberg U.S. Agg 1-3 Year Bond Index Morningstar U.S. Fund Short-Term Bond rs $13,000 Bloomberg U.S. Agg Bond Index $12,000 is o $11,000 d v A $10
Slide 27: Attractive long-term performance with a smoother ride (FPFIX)
The ultimate goal is attractive long-term performance with a smoother ride $13,000 FPA Flexible Fixed Income growth of $10,000 since inception L P $12,000 rs, $11,000 is o v $10,000 d FPA Flexible Fixed Income Bloomberg U.S. Universal Index Morningstar U.S. Fund Nontraditional Bond Bloomberg U.S. Ag
Slide 28: FPA New Income return simulation
FPA New Income return simulation as of Mar. 31, 2024 8.0 L P 7.0 rs, Hypothetical Total return - gross of fees (%) o 6.0 5.0 v is 4.0 3.0 A d 2.0 i f i c 1.0 a c 0.0 -100 -75 t P -50 -25 0 +25 +50 +75 Reference yield change (bps) +100 +125 +150 +175 +200 i rs The Chart shows the hypothetical impact
Slide 29: FPFIX return simulation
FPFIX return simulation as of Mar. 31, 2024 8.0 L P 7.0 rs, Hypothetical total return - gross of fees (%) o 6.0 5.0 v is 4.0 3.0 A d 2.0 i f i c 1.0 a c 0.0 -100 t -75 P -50 -25 0 25 50 75 Reference yield change (bps) 100 125 150 175 200 F i rs As of March 31, 2024. The Chart shows the hypothetical
Slide 30: Observations: Market Commentary
L P rs, is o d v Observations A Market Commentary i f i c a c t P i r s F 30
Slide 31: Fed Funds Rate expectations
Fed Funds Rate expectations Fed Funds Rate and futures pricing L P rs, is o v Percentage (%) A d i f i c a c t P F i rs Source: Deutsche Bank, “What keeps us awake at night?”, April 29, 2024. Dotted lines represent futures pricing as of dates noted. 31
Slide 32: Treasury yields remain near decade-plus highs
Treasury yields remain near decade-plus highs Treasury Yield L P 18.00% 16.00% rs, 14.00% is o 12.00% d v A 10.00% 8.00% 6.00% i f i c 4.00% a c 2.00% t P rs 0.00% i Apr-86 Apr-62 Apr-64 Apr-66 Apr-68 Apr-70 Apr-72 Apr-74 Apr-76 Apr-78 Apr-80 Apr-82 Apr-84 Apr-88 Apr-90 Apr-92 Apr-94 Apr-96 Apr-98 A
Slide 33: Investment grade bond yields remain near decade-plus highs
Investment grade bond yields remain near decade-plus highs Bloomberg U.S. Aggregate Bond Index L P , 18.00% 350 rs 16.00% 300 14.00% is o 250 12.00% v Yield-to-worst (YTW) d Spread (bps) 200 A 10.00% 8.00% 6.00% i f i c 150 4.00% a c 100 2.00% t P 50 rs 1st percentile i 0.00% 0 F Yield-to-worst Spre
Slide 34: High yield: reward generally not worth the risk
High yield: reward generally not worth the risk Bloomberg U.S. Corporate High Yield BB excl. Energy L P 18.00% 16.00% rs, 1,600 1,400 14.00% is o 1,200 12.00% d v Yield-to-worst (YTW) 1,000 Spread (bps) A 10.00% 800 8.00% i f i c 600 c 6.00% 4.00% P a 400 t 2.00% 200 0.00% i r s 0 Jan-94 Feb-96 Feb-
Slide 35: High yield: reward generally not worth the risk (spread)
High yield: reward generally not worth the risk Bloomberg U.S. High Yield Index Spread less Bloomberg Investment Grade Corporate Spread L P 2,500 rs, 2,000 is o d v Basis Points (bps) 1,500 c A 1,000 i f i 500 a c 3rd percentile (all HY) 0 t P 6th percentile (HY ex. Energy) F i rs All HY less Interm
Slide 36: FPA New Income Fund Portfolio Update
L P rs, is o d v c A FPA New Income Fund i f i c Portfolio Update a t P F i rs 36
Slide 37: FPA New Income portfolio overview
FPA New Income portfolio overview Sector Exposure (% of MV) Yield-to-Worst (%) Maturity (years) Effective Duration (years) Spread Duration (years) L P Nominal Spread (bps) Securitized Agency RMBS 81.6% 13.9% 5.62% 4.90% 3.9 5.3 3.1 4.5 rs, 3.4 4.5 122 64 o Non-Agency RMBS 4.7% 6.16% 4.5 3.6 3.6 174
Slide 38: FPA New Income exposures by investment idea
FPA New Income exposures by investment idea L P As of December 31, 2023 As of March 31, 2024 rs, Agency Performing Mortgage Pass- Corporates is o Mortgage Pass- through Agency Performing v CMBS through CMBS ABS Auto ABS 7% ABS 14% 12% 12% 14% Prime Equipment Equipment d 7% 15% Commercial Real 14% Es
Slide 39: FPA New Income quality distribution
FPA New Income quality distribution 100% L P , As of 3/31/2024: rs 90% High Quality AAA 83% 80% 70% is o AA A Total 90% 1% 6% v % of portfolio 60% d Credit Sensitive BBB 4% 50% 40% c A BB B 0% 1% i CCC 0% 30% 20% ci f CC C D 0% 0% 0% a NR 5% 10% 9% 8% 9% 9% 9% 10% 10% 10% 10% 10% 10%10% Total 10% P
Slide 40: FPA Flexible Fixed Income Fund Portfolio Update
L P rs, is o d v c A FPA Flexible Fixed Income Fund i f i c Portfolio Update a t P F i rs 40
Slide 41: FPA Flexible Fixed Income portfolio overview
FPA Flexible Fixed Income portfolio overview Sector Exposure (% of MV) Yield-to-Worst (%) Maturity (years) Effective Duration (years) Spread Duration (years) L P Nominal Spread (bps) Securitized Agency RMBS 72.7% 11.4% 6.36% 4.88% 4.1 5.7 3.0 4.7 rs, 3.5 4.8 202 67 o Non-Agency RMBS 4.3% 6.13% 4.2 3
Slide 42: FPA Flexible Fixed Income exposures by investment idea
FPA Flexible Fixed Income exposures by investment idea L P As of December 31, 2023 As of March 31, 2024 rs, ABS Equipment Mortgage Pass-through is o ABS Equipment Mortgage Pass-through Agency v Corporates 11% 10% CLO 11% 11% Performing Treasuries 10% CMBS d 12% Agency 12% 10% Performing A CMBS Corpo
Slide 43: FPA Flexible Fixed Income quality distribution
FPA Flexible Fixed Income quality distribution 100% L P , As of 3/31/2024: rs 90% High Quality AAA 73% 80% 70% is o AA A Total 80% 2% 5% v % of portfolio 60% d Credit Sensitive BBB 6% 50% 40% c A BB B 6% 4% i CCC 1% 31% 32% 30% 20% ci f 20% 20% 23% 24% 22% 24% 29% 30% 29% 28% 27% 23% 20% CC C D 0% 0
Slide 44: Question & Answer
L P rs, is o d v c Question & Answer A i f i ac t P F i rs 44
Slide 45: Deep flexible expertise
Deep flexible expertise The research process and compensation structure support the identification of investments that we believe have the most attractive risk vs. reward characteristics regardless of asset class L P ■ Collaborative culture: ‒ Encourages intellectual independence and curiosity rs, ‒
Slide 46: FPNIX return simulation vs. 12-month Treasury Bill
FPNIX return simulation vs. 12 month Treasury Bill FPNIX (gross of fees) FPNIX (net of fees) L P , 12 month Treasury Bill FPNIX (net of fees) less 12 month Treasury Bill rs 8.0 7.25 6.80 o Hypothetical total return (%) is 6.0 5.02 4.88 5.02 5.02 4.43 4.0 d v 2.63 2.18 A 1.78 2.0 0.0 i f i c -0.59 -2
Slide 47: FPNIX return simulation vs. 3-year Treasury
FPNIX return simulation vs. 3-year Treasury FPNIX (gross of fees) FPNIX (net of fees) L P , 3 yr. Treasury FPNIX (net of fees) less 3 yr. Treasury rs 8.0 7.25 o 6.80 6.33 Hypothetical total return (%) is 6.0 4.88 4.0 4.43 4.41 d v A 2.63 2.54 2.18 c 2.0 0.47 i f i 0.02 c 0.0 -0.36 -2.0 -100 P a 0 +1
Slide 48: FPNIX return simulation vs. 7-year Treasury
FPNIX return simulation vs. 7-year Treasury* FPNIX (gross of fees) 7 yr. Treasury FPNIX (net of fees) FPNIX (net of fees) less 7 yr. Treasury L P 10.0 9.63 rs, o Hypothetical total return (%) 8.0 7.25 6.80 6.0 4.88 4.43 4.21 v is d 4.0 3.07 2.63 A 2.18 2.0 c 0.22 0.0 i f i -0.89 c -2.0 -4.0 -100 P a
Slide 49: FPA Queens Road Small Cap Value Fund
L P rs, is o d v FPA Queens Road Smallc A i f i Cap Value Fund a c With Steve Scruggs t P F i rs 49
Slide 50: FPA Queens Road Small Cap Value Fund performance
FPA Queens Road Small Cap Value Fund performance Trailing Performance As of Date: 3/31/2024 Inception 20 Years 15 Years 10 Years 5 Years 3 Years 1 Year L P YTD QTD , FPA Queens Road Small Cap Value (%) 9.46 8.09 11.73 8.21 11.09 5.81 19.06 3.36 3.36 Russell 2000 Value (%) 8.23 7.47 12.10 6.87 8.17 2
Slide 51: When Steve Scruggs and Bob Rodriguez managed funds at the same time
When Steve Scruggs and Bob Rodriguez managed funds at the same time Below is the period during which Steve Scruggs & Bob Rodriguez each managed separate Small Value Funds at the same time, from mid-2002 to end of 2009. The period begins at Steve’s fund’s inception L P date, and it ends at Bob’s reti
Slide 52: Since Inception Returns
Since Inception Returns L P As of 3/31/2024 rs, FPA Queens Road Small Cap Value Fund Russell 2000 Value is o 9.46% 8.23% d v ■ Risk-Adjusted Returns: c A i f i ̶ 62 small cap value funds have been around since at least July 2002 a c ̶ FPA Queens Road Small Cap Value is #1 in the Morningstar Small Va
Slide 53: The case for FPA Queens Road Small Cap Value Fund
The case for FPA Queens Road Small Cap Value Fund Strong performance ■ Outperformed Russell 2000 Value Index (the “Index”) by ~120+bps on average, with ~25% less volatility since inception in 2002* L P Easy to own , ■ Morningstar rating of 5-stars overall and 5-stars over 10 and 5 years** rs ■ Consi
Slide 54: Goal and philosophy
Goal and philosophy The Fund seeks to generate returns in excess of the Russell 2000 Value Index over full market cycles with less risk. L P ■ Fundamental Analysis rs, ̶ We have a straightforward investment philosophy: seek to invest in quality businesses at reasonable prices using a fundamental, bo
Slide 55: Four Pillar process
Four Pillar process The Team follows a disciplined four-step process seeking to identify companies with the greatest likelihood of maximizing after-tax returns while limiting volatility. Our Four Pillars: L P 1. Balance Sheet rs, ̶ o Look for companies with strong balance sheets, manageable debt, an
Slide 56: Quality and the Four Pillar process
Quality and the Four Pillar process We have a preference for high-quality compounders. That is; strong balance sheets, proven management teams and favorable industry dynamics. L P rs, ■ Valuation - Valuation conscious but generally willing to pay up a little for quality. is o are today. d v ■ Qualit
Slide 57: Performance since inception
Performance since inception FPA Queens Road Small Cap Value Fund & Russell 2000 Value: Growth of $10,0001 L P $80,000 rs, FPA Queens Road $70,000 is o Small Cap Value Fund $71,644 v $60,000 $50,000 A d Russell 2000 Value Index $56,103 c $40,000 $30,000 i f i $20,000 a c $10,000 t P rs $0 i Jun-02 Ju
Slide 58: 5-year rolling returns by market type since Fund inception
5-year rolling returns by market type since Fund inception 30% Down Market Normal Market Robust Market L P , Small Cap Value (Net) FPA Queens Road 20% 10% o rs 0% v is -10% -10% -5% 0% 5% A 10% Russell 2000 Value d 15% 20% 25% 30% i f i c Down Market Normal Market Robust Market c Russell 2000 Value
Slide 59: Downside capture – Historically less risk
Downside capture – Historically less risk ■ Since inception in 2002, the Fund has outperformed during every large drawdown. L P 20% or Larger Russell 2000 Value Index Drawdowns Since Fund Inception rs, Jun-02 to Jun-07 to Jun-15 to is o Aug-18 to Nov-21 to Average of Each v Oct-02 Mar-09 Feb-16 Mar-
Slide 60: Active stock selection has driven differentiated returns
Active stock selection has driven differentiated returns Fully Invested Long-equity Gross Performance vs. Benchmark L P , S.I. 20 Years 15 Years 10 Years 5 Years 3 Years 1 Year YTD QTD QRSVX Fully Invested (Gross %) 12.51 11.12 15.76 11.30 14.20 7.40 22.48 3.96 3.96 rs Russell 2000 Value (%) 8.11 7.
Slide 61: Big trends impacting the portfolio
Big trends impacting the portfolio L P Interest Rates & Inflation rs, is o High Consumer Debt & Commercial d v Real Estate Stress c A i f i a c P Artificial Intelligence Disruption t F i rs As of March 31, 2024. 61
Slide 62: Regional bank exposure
Regional bank exposure Portfolio Company % of Year First Portfolio Purchased Description L P ServisFirst Bank is a conservatively-run lending franchise led by founder Tom Broughton. ServisFirst hires local bankers but doesn’t build branches, which promotes best-in-class efficiency metrics while main
Slide 63: Why own small-caps?
Why own small-caps? Russell 2000 Value Index and S&P 500 Index Total Returns – Monthly (Log Scale) L P rs, 10000% is o d v c A i 1000% ci f P a 100% rs t Feb-09 Jul-80 Jul-83 Jul-86 Jul-89 Jul-92 Jul-95 Jul-98 Mar-21 Mar-24 Feb-03 Feb-06 Feb-12 Feb-15 Feb-18 Jan-85 Jan-79 Jan-82 Jan-88 Jan-91 Jan-94
Slide 64: Small caps are compelling
Small caps are compelling Third time in approximately 30 years that small caps have sold at this large of a discount. L P Small Cap to Large Cap Historical P/E Ratio (x100) rs, o Small Cap: S&P Small Cap 600 Index: P/E = 14.80x (as of 3/31/24) Large Cap: S&P 500 Index: P/E = 25.22x (as of 3/31/24) i
Slide 65: Question & Answer
L P rs, is o d v c Question & Answer A i f i ac t P F i rs 65
Slide 66: Holdings as of March 31, 2024
Holdings as of March 31, 2024 P Communication Services 3.9% Industrials 20.1% Real Estate 0.2% IAC 2.1% Oshkosh 3.4% Equity Commonwealth 0.2% Scholastic Consumer Discretionary 1.9% 11.6% MSC Industrial Direct CSG Systems CSW Industrials 2.6% 2.2% 1.9% Utilities UGI , L 4.3% 2.4% rs PVH Corp 4.6% Sci
Slide 67: Notable sector exposures
Notable sector exposures We do not target sector weights or invest thematically. We invest from the bottom up, one company at a time. L P rs, ■ Financials ̶ is o We own fewer financials than the benchmark and our exposure is heavily weighted towards insurance and away from banks. ■ Technology d v ̶
Slide 68: Investment goal met since inception
Investment goal met since inception The Fund seeks to generate returns in excess of the Russell 2000 Value Index over full market cycles with less risk. L P Attractive Long-Term Performance Largest Drawdown in Russell 2000 Value Index rs, Lower Volatility Since Fund Inception is o 12% 10% 9.46% 8.23
Slide 69: FPA Capital Fund, Inc. historical performance
FPA Capital Fund, Inc. historical performance Trailing Performance (%) As of Date: 12/31/2020 Since 8/1/84 20 Years 15 Years 10 Years 5 Years 3 Years 1 Year YTD L QTDP FPA Capital Russell 2500 11.92 11.72 7.44 9.44 3.76 9.55 2.89 11.97 3.65 13.64 0.87 11.33 4.45 19.99 rs, 4.45 19.99 14.18 27.41 o An
Slide 70: Important disclosures
Important disclosures Important Disclosures Related to the FPA Funds L P Portfolio composition will change due to ongoing management of the FPA funds (each a “Fund” and collectively the “Funds”). References to individual securities or sectors should not be construed as a recommendation by the Funds,
Slide 71: Important disclosures (continued)
Important disclosures (continued) Important Disclosures Related to the FPA Funds (continued) L P Investments in private securities and limited partnerships present risks. These investments are not registered under the federal securities laws and are generally eligible for sale only to certain eligib
Slide 72: Important disclosures (continued)
Important disclosures (continued) Important Disclosures Related to the FPA Funds (continued) In relation to the FPA New Income Fund (“FPNIX”) and FPA Flexible Fixed Income Fund (“FPFIX”): L P , Abhijeet Patwardhan has been portfolio manager for the Funds since November 2015. Thomas Atteberry managed
Slide 73: Index definitions
Index definitions Index Definitions L P Index returns are generally provided for comparison purposes only. Indices are unmanaged and index returns do not reflect transactions costs (e.g., commissions), investment management fees or other fees and expenses that would reduce performance for an investo
Slide 74: Morningstar category definitions
Morningstar category definitions Index Definitions continued L P S&P SmallCap 600 Index is an index of small-cap stocks managed by Standard & Poor’s. It tracks a broad range of small-sized companies that meet specific liquidity and stability requirements. This is determined by specific metrics such
Slide 75: Morningstar rating disclosures
Morningstar rating disclosures Morningstar Rating disclosures L P The Morningstar RatingTM for funds, or “star rating”, is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at
Slide 76: Glossary of terms
Glossary of terms P ABS (Asset Backed Securities): financial securities backed by a loan, lease or receivables against assets other than real estate and mortgage-backed securities. L Advance rate is the percentage of the value of the collateral that a lender is willing to extend as a loan. , Average
Slide 77: Glossary of terms (continued)
Glossary of terms (continued) P Market Capitalization refers to the total dollar market value of a company's outstanding shares of stock. Commonly referred to as "market cap," it is calculated by multiplying the total number of a company's outstanding shares by the current market price of one share.
Slide 78: Glossary of terms (continued)
Glossary of terms (continued) P Yield refers to the earnings generated and realized on an investment over a particular period. It's expressed as a percentage based on the invested amount, current market value, or face value of the security. , L Yield to Maturity (YTM) is the rate of return anticipat