It’s winter — we don’t get many visitors here in the Great North. So, for the next several postings, I’ll highlight some of the companies hereabouts and do some other relevant charts.
We’ll start with the Mairs and Power Growth Fund. Chances are you’ve never heard of it. At $2.5 billion it’s not tiny, but it’s overshadowed by the behemoth funds (of behemoth fund families) in the industry. And it’s not real big considering it’s been around since 1958.
The firm’s website says, “Investing for the long-term.” The chart above shows performance since the beginning of 1990. The top panel is the absolute performance of the fund and the S&P 500, so that you can observe the degree of outperformance. The lower panel is the relative performance, making it easy to see when it’s beating the index and when it is not.
You can tell that the fund is conservatively run; the managers don’t chase the market when it gets crazy, but swamp it during downturns. That’s a very effective way to generate long-term returns in the growth arena; most growth managers do the opposite and do poorly over time.
So, this is not aggressive growth, but effective growth. And the fund sticks close to home, with most of its holdings in the Upper Midwest (some of which we’ll review in postings soon). Remarkably, only one of the top twenty-five holdings was purchased in the last ten years, according to a StarTribune story in response to the fund receiving an award from Morningstar.
A truly impressive track record. That’s just how we do things up here. (Chart: Bloomberg terminal.)
I was on the phone with a former co-worker last week and realized that I had probably been gone from the big asset management firm where we were as long as I had been there. (I was within a day; Bloomberg tells me I had been employed there 5,398 days.)
It was a formative time for me. So much of what I do in consulting — and so much of what I write about — builds on my time there, although I have tried to learn a few things since.
In any case, here’s just three of the many postings that were influenced by my experiences in those days:
The performance of some key asset classes from the time I walked in the door to the summer of 2011 (and some stories too).
A truly amazing tale about a portfolio manager who amassed 12% of Apple (culminating a few years after I had left). But patience ran out and “he was gone and it was gone.” Think of it.
“The indicator” — a simple couple of lines on a chart, plus an outrageous call on interest rates by my boss, one that would ripple for some time.