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Wasatch Core Growth Fund Manager J.B. Taylor on how small-cap stocks can boost your portfolio.
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We'll -- Taylor says that in this volatile environment it is all about small caps and big growth over the long term -- -- core growth fund manager.
Joins me now fox -- explicit from New York City and -- -- asking about that because obviously.
It -- in the beginning of the year we saw this huge pop in the Russell one candidate that the Russell is performing.
Rather strongly at more than 7% your fund isn't quite matching that are you gonna stick what that's small cap the.
Oh absolutely well thank you for having me you know we're small cap investors.
-- the fund I run as the core growth fund which is a small cap strategy focused on what we think are the highest quality companies in the small cap universe.
And the wonderful thing about small caps is that I have thousands of companies to pick and choose from to build a -- name portfolio and it.
Having that I can always find interest in growers.
Well plus talk about what exactly is and -- that's in particular sorry your call holdings because I'm wondering if you might have to reevaluate just a little like considering where you are -- Your benchmark at this point you've got -- part.
Incorporated that got us your biggest holding right now is -- apart Lifetime Fitness idexx alliance data.
Waste Connections I mean even a major percentage and -- -- right now do you think you might have to kind of restructure a little bit considering reroute.
I don't think so -- part is -- phenomenal company -- part is.
If -- -- if you wreck your car and it's dean total there's about a 40% chance that it's -- part that comes to pick up the car.
Take it to one of their facilities and then they auction it off to the highest bidder.
-- make a great -- in doing so.
They have great margins great returns on capital and an excellent management team and and if anything in market weakness this is a company that continues to buy back their stock.
I was also looking at what -- smaller holdings and that is Mednax is yesterday's decision affect back holding for you.
Not really that the stock was up yesterday but to give you sense for how we invest in if you look at my top ten holdings the average holding period.
Is about eight years and so we've owned Mednax for a long period of time.
They take care of sick infants in the -- -- of hospitals and it's a very stable market reimbursement there's been very stable we don't really expect to change OK so overall for for those of our viewers that may -- don't have huge positions portfolio positions in the small -- small cap sector.
Over all -- do you think that at this point in the year that -- any considering where the markets are you can make that case for small caps or do you think that.
We should maybe -- -- look at it kind of diversify a little bit.
What think diversification as always good I think for the long period how you always want to be interest in companies that are growing.
And you're going to find more growth in the small cap space and you're going to be able to pick and choose from a wider.
Batch of companies to find those growers.
Large caps right now you can make the case they're they're interest thing they're cheaper than they've been historically.
Some of them pay very nice dividends.
But at the end of it at the end of the day they're very beholden to the overall growth of the economy which we expect to be -- a little bit sluggish.
-- -- what you've also got a lot of holdings within the industrial sector that seems to be kind of a -- theme for you.
Within small -- what is it about industrials -- -- like -- now.
Well we're not making a macro call and industrials -- say we just happen to find some very interest in companies with competitive advantages.
Some pricing power great returns on capital in that space so that that's really our strategy is a bottom up strategy as opposed to making top down bats.
Alright -- retailer wants -- core growth fund.
Manager at a Salt Lake City wants -- of course others many restaurants and bars in Salt Lake City named after Los sad so there you go to that the theme might see.
It's great to have you on the show thank you.
Thank you very much.
