COLLEGE PLANNING | ESTATE PLANNING | INVESTING | PORTFOLIO SPOTLIGHT | REAL ESTATE | RETIREMENT | TAX PLANNING
FMI Common Stock Fund
TICKER ASSETS
FMIMX $ 1.2 billion
PERFORMANCE YTD 1 yr . 3 yr . 5 yr . 10 yr . 15 yr . 5.66 % 8.72 % 21.08 % 9.65 % 9.76 % 9.93 %
TOP FIVE HOLDINGS Insight Enterprises Inc .; Henry Schein Inc .; Interpublic Group of Cos . Inc .; Genpact Ltd .; Skechers USA Inc .
CONTACT INFO
800.811.5311 • fmimgt . com
EQUITY SECTOR ALLOCATION ( As a % of portfolio )
Finance 16.3 % Commercial Services 14.7 % Distribution Services 14.4 % Electronic Technology 7.6 % Technology Services 5.6 % Consumer Non-Durables 4.5 % Retail Trade 3.9 % Consumer Durables 2.2 % Process Industries 2.0 % Cash and Equivalents 5.8 %
Performance and asset numbers as of 5 / 5 / 23 . Holdings , sector weightings as of 3 / 31 / 23 . Sources : FMI and Morningstar .
Capital Preservation + Price Appreciation = Results
The FMI Common Stock Fund has a successful 40-year track record . By Jeff Schlegel
THE FMI COMMON STOCK FUND IS A VALUE-FOCUSED , small-cap / mid-cap product ( also known as SMID ) with an impressive track record during the past 15 years . On average , it has outperformed its Russell 2000 Index benchmark by a comfortable margin . And depending on the time frame , it has remained within shouting distance of — or exceeded — the performance of the large-cap S & P 500 during that period .
So when Milwaukee-based asset manager Fiduciary Management Inc . states that the next 15 years will likely create economic conditions that could keep the good times rolling for the fund , it might scream of boosterism . But the firm posits that the massive fiscal and monetary stimulus of the past decade and a half created too much liquidity and encouraged what it calls “ uneconomic activity ” such as suspect mergers and acquisitions , a raft of unprofitable companies going public , and hefty increases in leverage .
“ We think the economy is poised for a much stronger , healthier run during the next 15 years than the past 15 years ,” says Patrick English , FMI ’ s executive chairman , who co-manages the Common Stock Fund with Jonathan Bloom .
He reasons that the cost of capital was suppressed and manipulated down to a “ ridiculous level ” that actually suppressed growth because it resulted in companies buying each other rather than investing and growing organically . “ If low interest rates are good for the economy we should ’ ve had the fastest growing economy in our history in the past 15 years , and it was actually the slowest ,” he points out .
Bloomberg data on U . S . average real GDP growth during the past five 15-year increments ( from 1948 through 2022 ) show that growth averaged from 3 % to 3.9 % during each of those periods except for the years 2008 through 2022 , when the average was 1.7 %. The Great Recession that began in 2008 didn ’ t help matters , but that was followed by a tremendous infusion of artificial liquidity that English believes fostered bad corporate habits .
40 | FINANCIAL ADVISOR MAGAZINE | JUNE 2023 WWW . FA-MAG . COM