4 Little Medalists

You might not know much about the Morningstar Medalists I’m looking at this month--those with the smallest asset bases. There’s something of a theme, too, as each one comes from a boutique firm. Some are small even by boutique standards.

Funds like these would be larger than they are with a big marketing staff to support them. Three of the funds originated from old-fashioned firms that began by running all of their clients’ money. Doing that generally means that you take a conservative approach, because clients might not be diversified across a wide array of asset classes the way they’d be at a bigger complex.

That’s why some have been lagging recently. It can be tough for conservative funds to keep up in a strong rally. Yet, the fact that they are different from funds you’d find at a big fund company is part of their appeal. I’ll take them from smallest to largest.

Royce Special Equity Multi-Cap

RSEMX has shown it knows how to protect on the downside. Charlie Dreifus’ fund held up well in the sell-off at the beginning of the year but then lagged in the rebound to have a middling return for the year to date through May. Dreifus’ skill at playing defense has long been known by shareholders of

Berwyn

BERWX has just $126 million in assets and a Morningstar Rating of 2 stars, so it would be easy to skip over it. But you can see its appeal in the way it held up in January and February 2016 when it lost much less than its peers. It also produced top-quartile performance in tough markets like 2011 and 2008. The fund seeks out good values among micro-cap stocks and the small end of small caps. It also holds cash and has a fondness for basic-materials stocks, which can protect against inflation spikes. However, those materials stocks stung in 2015 when commodities got crushed. Lead managers Robert Killen and Lee Grout are seasoned veterans who have steered the fund through a variety of markets.

Perkins Global Value

JGVAX is part of Janus, so you might think it could drum up some shareholders, but the fund still has just $220 million in assets. Perkins chief investment officer Greg Kolb has largely matched the returns of the benchmark and peers during his tenure, but he’s done so with less risk. The fund lost much less than peers and its benchmark in 2008 and 2011. He looks for cheap stocks with strong cash flows and healthy balance sheets. Defensive names like

Mairs & Power Small Cap

MSCFX first earned a Silver rating from us in June 2015 but remains at just $238 million in assets. While Royce Special Equity Multi-Cap applied the firm’s time-tested strategy to larger-cap names, Mairs & Power went in the other direction--although small caps have long been a component of

For a list of the open-end funds we cover, click here. For a list of the closed-end funds we cover, click here. For a list of the exchange-traded funds we cover, click here. For information on the Morningstar Analyst Ratings, click here.