Near the end of the March 14 commentary, David parenthetically referred to NOLCX as a "Nice little fund, by the way." I was hoping someone might elaborate on that a little - try to help me identify possible holes in how I research funds. When I look at NOLCX, I see a fund with only $25M that still manages to have over 100 large cap stocks and an 86% turnover. Only holdings greater than 2% are Exxon, Apple, Microsoft, Johnson & Johnson, and Chevron. Thoughts?
Comments
I guess I was noticing the above average returns (more or less top 10% in the low term), slightly above average upside capture, slightly below average downside capture, exceptional Sharpe ratio (that is, risk-adjusted returns), low expenses, and pretty solid tax-efficiency.
It's not a large fund and Northern is very unlikely to run a compact portfolio, it's not their style. That said, solid singles hitter for cheap.
David
The beta over 1 and nearly 100% turnover every year also raised my eyebrow, but I hadn't noted the after-tax returns.
Morningstar seems to consider them pretty conservative - in line with your singles hitter observation. As I recall, NOLCX isn't the only Northern fund you've positively highlighted.