Steven Romick Celebrates 25 YearsVW Staff
The FPA Crescent Fund (FPACX) celebrated its 25-year anniversary this month. With its unfettered mandate, the management team has maintained the same philosophy and flexible approach that existed at the Fund’s inception. We have been fortunate over the past 25 years to have achieved our Fund’s objective of equity-like returns over the long-term, while taking less risk than the market and avoiding permanent impairment of capital.
While we acknowledge the significance of a quarter century behind us, we also appreciate that recent years have not been friendly to the practitioner of value investing. If the U.S. does not find itself in a bear market by the fourth quarter, this bull market that began in March of 2009 will officially be the longest on record.1 In addition, value stocks have underperformed growth stocks in 94% of the rolling five-year periods since March 2004 – and not by a little, but by more than an average of two percent annualized in each period.2
FPA Crescent has delivered on its objective even in the current market cycle despite such headwinds.3 Nevertheless, we look forward to (but do not forecast) when global markets will inevitably provide more opportunities as a result of bad news and/or fear.
We appreciate and thank our long-standing shareholders who by holding steadfast through the market’s vacillations have been able to achieve returns (their dollar-weighted return4) in line with that of Crescent's time-weighted returns, which is unusual in our industry.
The challenges of a consistent team delivering successfully over time is reflected in the following:
Although nice to periodically reflect on past success, it will do us no good to rest on it. We look forward to continuing to deliver on our objective in the years ahead, and celebrating more milestones. In the interim, the team has readied itself for what lies ahead.