Emerging Opportunity Fund (OSTGX)
Investment Objective
The Fund seeks long-term capital appreciation.
Fund Literature
Investment Strategy
The Fund invests primarily in the common stocks of companies that the Osterweis Capital Management investment team believes may experience rapid revenue and earnings growth. In selecting investments, the investment team seeks to identify high quality companies within emerging industries and market niches with significant revenue and earnings growth potential before they are widely discovered.
Highlights
- Bottom-up stock selection based on rigorous fundamental analysis
- Risk-aware strategy
- Experienced investment team
- Adviser is majority-owned by its employees
Minimum Investments
- $5,000 initial investment for regular accounts
- $1,500 initial investment for IRA or other tax-deferred accounts
- $100 for subsequent investments
Performance
Quarter-End Performance (as of 9/30/19) (%)
| 1 MONTH | QTD | YTD | 1 YEAR | 3 YEAR | 5 YEAR | 7 YEAR | 10 YEAR |
Since Inception (10/1/2012) |
|
|---|---|---|---|---|---|---|---|---|---|
| OSTGX | -6.44% | -7.78% | 20.89% | -8.61% | 16.20% | 12.84% | - | - | 14.40% |
| Russell 2000 Growth Index | -0.82 | -4.17 | 15.34 | -9.63 | 9.79 | 9.08 | - | - | 11.39 |
| OSTGX | Russell 2000 Growth Index | |
| 1 MONTH | -6.44 | -0.82 |
|---|---|---|
| QTD | -7.78 | -4.17 |
| YTD | 20.89 | 15.34 |
| 1 YEAR | -8.61 | -9.63 |
| 3 YEAR | 16.20 | 9.79 |
| 5 YEAR | 12.84 | 9.08 |
| 7 YEAR | - | - |
| 10 YEAR | - | - |
| Since Inception (10/1/2012) |
14.40 | 11.39 |
Gross/Net expense ratio as of 6/30/2019: 1.25% / 1.13%. The Adviser has lowered the expense cap to 1.10% and contractually agreed to waive certain fees through June 30, 2021. The net expense ratio is applicable to investors.
Performance data quoted represent past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be higher or lower than the performance quoted. The Adviser has contractually agreed to waive certain fees through November 30, 2018. Performance prior to December 1, 2016 is that of another investment vehicle (the “Predecessor Fund”) before the commencement of the Fund’s operations. The Predecessor Fund was converted into the Fund on November 30, 2016. The Predecessor Fund’s performance shown includes the deduction of the Predecessor Fund’s actual operating expenses. In addition, the Predecessor Fund’s performance shown has been recalculated using the management fee that applies to the Fund, which has the effect of reducing the Predecessor Fund’s performance. The Predecessor Fund was not a registered mutual fund and so was not subject to the same operating expenses or investment and tax restrictions as the Fund. If it had been, the Predecessor Fund’s performance may have been lower.
Rates of return for periods greater than one year are annualized.
Philosophy
Our investment philosophy is based on two primary tenets:
- Rapid and sustainable revenue growth is the largest determinant of stock returns.
- A concentrated portfolio, with valuation sensitivity, is the best way to generate long-term outperformance.
Our objective is to invest in a high conviction portfolio of emerging, innovative companies with the potential for significant revenue growth before they are widely discovered. We believe the best way to identify such firms is to use bottom up, fundamental analysis to find companies that are well-positioned to capitalize on meaningful secular growth trends.
At the same time, valuation discipline is a critical component of our approach. We look for opportunities with at least 100% potential upside over our investment horizon. We find there are three situations that create particularly attractive entry points: misunderstanding by investors, temporary missteps by the company, and/or market corrections.
Investment Team
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James L. Callinan
Vice President & Chief Investment Officer – Emerging Growth
View BioJames L. Callinan
Vice President & Chief Investment Officer – Emerging Growth
Jim Callinan graduated from Harvard College (B.A. Economics), New York University (M.S. Accounting) and Harvard Business School (M.B.A.). Mr. Callinan holds the Chartered Financial Analyst designation.
Prior to joining Osterweis Capital Management in 2016, Mr. Callinan managed the Emerging Growth Partnership, LP, a concentrated small cap growth strategy he founded at RS and transitioned to his own firm. Before that, he was Co-Founder & Chief Investment Officer at RS Investments. He also co-founded the RS Growth Group LLC at Robertson Stephens Investment Management in 1996 and managed the RS Emerging Growth Fund from 1996 until 2010.
He began his career at Putnam Investments as an equity research analyst in 1987 and served as portfolio manager for the Putnam OTC Emerging Growth Fund from 1994 to 1996.
Mr. Callinan is an Executive Committee member of the of Weatherbie Capital (an Alger Company) Advisory Board and the Friends of Harvard Football Board.
Mr. Callinan is a principal of the firm and a Portfolio Manager for the emerging growth strategy. He is also a Portfolio Manager for the flexible balanced strategy.
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Matthew C. Unger
Vice President & Analyst
View BioMatthew C. Unger
Vice President & Analyst
Matt Unger graduated from Trinity University (B.S. Finance, cum laude) and Southern Methodist University, Cox School of Business (M.B.A.). Mr. Unger holds the Chartered Financial Analyst designation.
Prior to joining Osterweis Capital Management in 2016, Mr. Unger worked at Callinan Asset Management as a Research Analyst covering the health care service, medical technology and industrial sectors. Prior to that, he spent three years at RS Investments as a Research Associate covering small cap growth companies in the medical technology and industrial sectors. Before graduate school, Matt worked at Platte River Capital covering the medical device sector from 2008-2010.
Mr. Unger is an Analyst for the emerging growth strategy.
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Bryan Wong
Analyst
View BioBryan Wong
Analyst
Bryan Wong graduated from Yale University (B.A. in Political Science and International Studies with distinction) and the University of California Berkeley, Haas School of Business (M.B.A., Investment Management Fellow). Mr. Wong holds the Chartered Financial Analyst designation and is a member of the CFA Society of San Francisco.
Prior to joining Osterweis Capital Management in 2014, Mr. Wong was a member of the investment team managing the endowment of the David and Lucile Packard Foundation. Before that, Mr. Wong was an Analyst from 2005 to 2009 at two long/short hedge funds.
Mr. Wong is an Analyst for the emerging growth strategy.
The Adviser has contractually agreed to waive certain fees through June 30, 2021.
The Osterweis Funds are available by prospectus only. The Funds’ investment objectives, risks, charges and expenses must be considered carefully before investing. The summary and statutory prospectuses contain this and other important information about the Funds. You may obtain a summary or statutory prospectus by calling toll free at (866) 236-0050, or by visiting www.osterweis.com/statpro. Please read the prospectus carefully before investing to ensure the Fund is appropriate for your goals and risk tolerance.
Mutual fund investing involves risk. Principal loss is possible.
The Osterweis Emerging Opportunity Fund may invest in unseasoned companies, which involve additional risks such as abrupt or erratic price movements. The Fund may invest in small and mid-sized companies, which may involve greater volatility than large-sized companies. The Fund may invest in IPOs and unseasoned companies that are in the early stages of their development and may pose more risk compared to more established companies. The Fund may invest in ETFs, which involve risks that do not apply to conventional funds. Higher turnover rates may result in increased transaction costs, which could impact performance. From time to time, the Fund may have concentrated positions in one or more sectors subjecting the Fund to sector emphasis risk. The Fund may invest in foreign and emerging market securities, which involve greater volatility and political, economic and currency risks and differences in accounting methods. These risks may increase for emerging markets.
While the fund is no-load, management fees and other expenses still apply. Please refer to the prospectus for more information.
Osterweis Capital Management is the adviser to the Osterweis Funds, which are distributed by Quasar Distributors, LLC.
