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This month David provided an interesting follow-on to the merging of Marsico Flexible Capital and Marsico Global. "Briefly Noted," He thoughtfully researched possible alternatives to MFCFX and came up with a grid of several balanced/allocation funds. As a result, Provident Trust (PROVX) came to light and he commented, "And if you’re suddenly wondering why we haven’t profiled Provident Trust yet, join the club. I’m wondering the same thing."

I used to own MFCFX and the whole time I wondered how it got categorized as an allocation fund; for me it was a global growth fund whose mandate allowed it to invest in other "stuff." It rarely did and even today it has nothing but stocks and a bit of cash. These days M* has an 85%+ allocation category, the best fit, I think, for a fund that does in fact allocate.

Apparently PROVX would fall into that category, but M* has it pegged as Large Growth. In any event, PROVX today is a highly concentrated (14 stocks) large-cap growth fund with about 10% cash and 5% bonds. Its performance is terrific, from almost any angle, but most assuredly from the perspective of a 85%+ allocation instrument. I would compliment the fund manager on a succinct and rare summary of what he does, has done in the past, and what market conditions prevail now and into the near future. To wit: Shareholder Letter.pdf

According to the letter, the fund really has been flexible with respect to its equity allocation. I have not followed it. I guess a small fund could jump in and out of stocks efficiently, but I couldn't imagine FPACX (one of the other balanced funds used as a comparison) doing the same. Provident's turnover ratio is so impossibly low as to confound us. I hope David can profile PROVX as it sounds interesting.


  • edited August 2018
    I bought into PROVX about 9 months ago. Was part of the FMI Fund family until October 2013 when it was reorganized some years ago (believe the fund was sub-advised back then by the current management team). Prefer it more so than FPACX as it has grown so much over the years in AUM with no real decline in the expense ratio (another problem with FPA Funds).
  • Hi, Ben!

    Thanks, and thanks for the reminder: "FMI Provident" popped immediately into my head, then I checked the FMI family, it wasn't there and I didn't have time to go suss out the story.

  • The FMI connection makes geographical sense; both companies are located in Milwaukee and degrees from Madison are common among Provident's personnel. Don't want to date myself, but in New England where I grew up the University of Wisconsin had a somewhat mythical reputation because it was said that 3.2 beer was served in the student union. Selected states back then allowed drinking at 18, neighboring New York included.
  • edited August 2018
    Found the 2012 proxy material filing to shareholders concerning reorganization:
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