Skip to Content
Investing Specialists

Is a Concentrated Fund a Fit for Your Portfolio?

Four questions to ask when determining whether a focused holding makes sense for you.

Mentioned: , , , , , ,

 Sequoia (SEQUX) recently made headlines for its concentrated portfolio, as a double-digit position in  Valeant Pharmaceuticals (VRX) has led to sizable losses at this storied fund.

But Sequoia is hardly the first concentrated fund to soar, then take a nosedive, due to its heavily weighted positions. Some of the most fabled mutual funds of the past few decades have experienced a similar boom-bust cycle, including  Fairholme (FAIRX),  Oakmark Select I (OAKLX), and  Janus Twenty T (JAVLX). Some have recovered, others not so much.

Christine Benz has a position in the following securities mentioned above: OAKLX. Find out about Morningstar’s editorial policies.