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Fairholme Message Board

  • irish68178 irish68178 Jan 5, 2007 2:20 PM Flag

    FAIRX From A Shareholder's Perspective

    Are you looking for a fund which has a low amount of risk but also has fantastic returns over the years? If so, I believe FAIRX is a stock you should look into. The Fairholme fund has performed very well over the years despite oftentimes having a fair amount of money out of the market. While I normally frown on having money on the sidelines, FAIRX still can perform, so I give it my blessing. FAIRX uses the money on the sideline to allow flexibility if a new opportunity comes up which allows it to quickly react to market opportunities.

    One of the biggest plusses of the Fairholme fund is its large investment in Berkshire Hathaway. As a small investor in my early 20s, I do not have the money to own Berkshire as of yet. However, owning this fund gives me exposure to this great company.

    One negative that some investors may find is that this is a fairly focused fund with its top three holdings accounting for 30% of assets. If you are looking for a broadly diversified fund, this is probably not the one you want. However, if you want a fund which has been rated by Morningstar as having low risk but also has great returns, this may be your fund.

    I would recommend this fund to those who still can take on some risk, since it isn't as diversified as some, but need strong returns. I personally view it more as a secondary holding rather than a primary holding. Good luck to you all.

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