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The stock market ended the first quarter of 2014 on a choppy note. Despite this fact, when one thinks back to five years ago when the bull market began, it has been a very productive period for fund investors. With uncertainty “in the air” at this time, we wish to go back and look at the top-performing funds in terms of annualized total return, over that period. Only actively managed funds will be considered here, hence index and leveraged funds will be excluded. Institutional share classes with their high minimum initial investments are also not included.

Interestingly, the top-performing fund for the five years ended March 31, 2014 was Oceanstone Fund (OSFDX) with an impressive 50.5% total return. This fund is certainly not a household name and actually may only be purchased via the fund’s transfer agent. It had $45.2 million in Net Assets at December 31, 2013 with approximately 70% in cash. At that time, it had only three equity holdings: JAKKS Pacific (JAKK), Rite Aid (RAD), and ITT Educational Services (ESI). When the fund invests in securities, it purchases only common stocks that it believes to be undervalued.  

Next on the list is Fidelity Select Automotive (FSAVX) with a 38.80% annualized return. One of Fidelity’s many sector funds, the portfolio manager seeks capital appreciation through investments in companies engaged in the manufacture, marketing or sale of automobiles, trucks, specialty vehicles, parts, tires, and related services. Top holdings at March 31, 2014 were Honda Motor Ltd. (HMC), Toyota Motor Corp. (TM), and General Motors Co. (GM). 

The third-ranking fund for the period is Hotchkis & Wiley Small Cap Value (HWSAX). The fund employs a “bottom-up” value investing discipline for companies in the small cap universe. Top holdings as of March 31, 2014 are Masonite International Corp. (DOOR), Con-Way Inc. (CWY), and First Horizon National Corp. (FHN).  

What follows below is performance data for the top-ten funds according to the factors mentioned above. Results are through March 31, 2014, and are in descending order by five-year average total return.

FUND NAME/TICKER

AUM (mil. US$)

3 Month Total Return (%)

1 year Total Return (%)

3 year Avg. Total Return (%)

5 year Avg. Total Return (%)

Oceanstone Fund (OSFDX)

$45

0.9

24.2

12.6

50.5

Fidelity Select Automotive (FSAVX)

$189

0.1

36.4

11.1

38.8

Hotchkis & Wiley Small Cap Value (HWSAX)

$190

2.0

28.7

14.7

34.8

Matthew 25 Fund (MXXVX)

$821

-1.5

24.6

22.3

34.5

Buffalo Emerging Opportunities (BUFOX)

$328

-3.3

39.3

23.6

34.4

Huber Small Cap Value (HUSIX)

$142

-2.5

16.4

15.0

34.1

Southern Sun Small Cap (SSSFX)

$417

-3.5

21.2

15.3

34.0

Oppenheimer Intl Small Company (OSMYX)

$107

3.3

37.1

16.3

33.5

Fidelity Select Multimedia (FBMPX)

$930

-2.4

24.7

20.8

33.3

Hodges Small Cap Fund (HDPSX)

$646

1.9

29.2

16.0

32.6

 

At the time of this article, its author did not have positions in any of the stocks mentioned.