Baron Focused Growth Fund (BFGFX)

Portfolio Management

Ron Baron

Fund Manager since 1996

Objective & Strategy

This is a focused Fund that invests mainly in small and mid-sized U.S. companies with significant growth potential. The Fund's top 10 holdings are expected to comprise a significant percentage of the Fund. Non-diversified.

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Fund Description

Baron Focused Growth Fund invests in a focused portfolio of small and mid-size growth companies.



Performance Summary as of December 31, 2016

  Annualized Returns Since Inception
YTD 1 YR 3 YR 5 YR 10 YR Annualized Cumulative
0.67% 0.67% 0.18% 7.95% 5.44% 10.24% 643.26%
Growth of $10,000 Chart

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Top Ten Holdings as of December 31, 2016

Holding Sector Percentage
Vail Resorts, Inc. Consumer Discretionary 12.5%
Tesla Motors, Inc. Consumer Discretionary 11.0%
Hyatt Hotels Corp. Consumer Discretionary 10.7%
CoStar Group, Inc. Information Technology 8.1%
FactSet Research Systems, Inc. Financials 7.0%
Arch Capital Group Ltd. Financials 4.9%
Choice Hotels International, Inc. Consumer Discretionary 4.8%
Manchester United plc Consumer Discretionary 4.5%
Iridium Communications Inc. Telecommunication Services 4.4%
Benefitfocus, Inc. Information Technology 3.8%
Total 71.7%
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Performance Based Characteristics as of December 31, 2016

Characteristics 3 Years 5 Years 10 Years Since Inception
Standard Deviation (%) 13.89 12.70 18.64 21.27
Sharpe Ratio 0.01 0.62 0.25 0.37
Alpha (%) -4.14 -2.74 -1.63 4.72
Beta 0.84 0.80 0.88 0.77
R-Squared (%) 80.40 78.17 85.95 67.92
Tracking Error (%) 6.52 6.50 7.34 13.09
Information Ratio -0.81 -0.91 -0.38 0.22
Upside Capture (%) 72.65 72.76 84.82 88.78
Downside Capture (%) 93.46 86.69 91.64 76.65

Daily Price (NAV)

Prices for Jan 13 , 2017
NAV $12.93
Daily Change ($) $0.13
Daily Change (%) 1.02%
MTD 4.02%
YTD 4.02%
52-Week High $13.84
52-Week Low $10.84

Fund Facts

Inception Date May 31, 1996
Net Assets^ $175.19 million
CUSIP 06828M207
Expense Ratio* 1.39% / 1.35%
Risk/Return Comparison
Risk Return Graph

The Fund is non-diversified, which increases volatility of the Fund’s returns and exposes it to greater risk of loss in any given period.  Specific risks associated with investing in small and medium-sized companies include that the securities may be thinly traded and more difficult to sell during market downturns.


Morningstar Ratings
Ratings based on risk-adjusted returns as of 12/31/2016
Category: US Fund Mid-Cap Growth
Overall 1 Stars out of 588 funds
3 Year 2 Stars out of 588 funds
5 Year 1 Stars out of 504 funds

The Overall Morningstar Rating for a fund is derived from a weighted-average of the performance figures associated with its three-, five- and (if applicable) ten-year ratings.

Lipper Rankings
Rankings based on total returns as of 12/31/2016
Category: Mid-Cap Growth Funds
1 Year 357 out of 389 funds
3 Year 343 out of 361 funds
5 Year 308 out of 317 funds


Baron Category: Small- to Mid-Cap Growth
Large Value Large Core Large Growth Large
Mid Value Mid Core Mid Growth Mid
Small Value Small Core Small Growth Small
Value Core Growth  
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Performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor's shares, when redeemed, may be worth more or less than their original cost. The Adviser has reimbursed certain Fund expenses and the Fund's transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted above. For performance information current to the most recent month end, click here.

The Fund may not achieve its objectives.

^All share classes combined. As of most recent quarter end.

*As of fiscal year ended 12/31/2015, the gross expense ratio of the Fund’s Retail Shares was 1.39%, but the net expense ratio was 1.35% (net of the Adviser's fee waivers).

Reflects actual fees and expenses charged when the Fund was a partnership. The partnership charged a 15% performance fee. If the annual returns for the Fund did not reflect the performance fee for the years the partnership charged a performance fee, the returns would be higher. The Fund’s shareholders are not charged a performance fee. The partnership’s performance is before 6/30/2008. During those periods, the partnership was not registered under the Investment Company Act of 1940 and was not subject to its requirements or the requirements of the Internal Revenue Code relating to registered investment companies, which, if it was, might have adversely affected its performance.

The Risk/Return Comparison plots the since inception return of the Fund against the Fund's Standard Deviation for the same time period. Source: FactSet SPAR.

Top Ten Fund Holdings based on net assets. Portfolio holdings may change over time.
Industry sector or sub-industry group levels are provided from the Global Industry Classification Standard ("GICS"), developed and exclusively owned by MSCI, Inc. ("MSCI") and Standard & Poor's Financial Services LLC ("S&P"), unless otherwise stated that they have been reclassified or classified by the Adviser. All GICS data is provided "as is" with no warranties.

For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a fund's monthly performance (including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars and the bottom 10% receive 1 star. (Each share class is counted as a fraction of one fund within this scale and rated separately.) © 2014 Morningstar, Inc.  All Rights Reserved. The Morningstar information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.

Lipper Analytical Services, Inc. rankings and fund performance do not reflect sales charges and are based on total return, including reinvestment of dividends and capital gains for the stated periods.

Performance Based Characteristics are based on trailing five-year and since-inception periods. Performance statistics for additional periods will be provided on request. Source: FactSet SPAR.

Definitions (provided by BAMCO, Inc.): The indexes are unmanaged. The Russell 2500™ Growth Index measures the performance of small to medium-sized companies that are classified as growth, and the S&P 500 Index of 500 widely held large-cap U.S. companies. The indexes and the Fund are with dividends, which positively impact the performance results. The Morningstar Mid-Cap Growth Average is not weighted and represents the straight average of annualized returns of each of the funds in the Mid-Cap Growth category. The Fund's Retail Shares have been included in the category since 6/30/08 and the Fund's Institutional Shares since 5/29/09. © 2014 Morningstar, Inc.  All Rights Reserved.  The Morningstar information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely.  Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Standard Deviation: measures the degree to which a fund’s performance has varied from its average performance over a particular time period. The greater the standard deviation, the greater a fund’s volatility (risk). Sharpe Ratio: is a risk-adjusted performance statistic that measures reward per unit of risk. The higher the Sharpe ratio, the better a fund’s risk adjusted performance. Alpha: measures the difference between a fund’s actual returns and its expected performance, given its level of risk as measured by beta. Beta: measures the fund’s sensitivity to market movements. The beta of the market (Russell 2500 Growth Index) is 1.00 by definition. R-Squared: measures how closely a fund’s performance correlates to the performance of the benchmark index (Russell 2500 Growth Index), and thus is a measurement of what portion of its performance can be explained by the performance of the index. Values for R-Squared range from 0 to 100, where 0 indicates no correlation and 100 indicates perfect correlation. Tracking Error: measures how closely a fund’s return follows the benchmark index returns (Russell 2500 Growth Index). It is calculated as the annualized standard deviation of the difference between the fund and the index returns. Information Ratio: measures the excess return of a fund divided by the amount of risk the fund takes relative to the benchmark index (Russell 2500 Growth Index). The higher the information ratio, the higher the excess return expected of the fund, given the amount of risk involved. Upside Capture: explains how well a fund performs in time periods where the benchmark’s returns (Russell 2500 Growth Index) are greater than zero. Downside Capture: explains how well a fund performs in time periods where the benchmark’s returns (Russell 2500 Growth Index) are less than zero. This information does not constitute an offer to sell or a solicitation of any offer to buy securities by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation.