Investors seeking a fund focused on long-term returns might want to consider Bridgeway Aggressive Investors 2
- Inception date: Oct. 31, 2001
- Expense ratio: 1.19%
- Net assets: $806 million
- Investment minimum: $2,000
Bridgeway founder John Montgomery has managed the fund since 2001, using a quantitative approach. His focus, combining long-term performance with risk management, has solidly trounced the S&P 500 benchmark. The fund has returned an average of 20.3% in the past five years.
Bridgeway Aggressive holds just more than 60 securities, with top holdings including packaging company Owens-Illinois
Fees and risks
Bridgeway Aggressive Investors 2's performance-based management fee is somewhat unusual for a mutual fund. However, the fee aligns management's incentives with shareholders' interest in ensuring good long-term fund performance. In addition, the expense ratio is capped at 1.75%; even when the fund does really well, the performance-based fee can only go so high.
Bridgeway Aggressive has done well in the bull-market years since its inception. However, shareholders can expect to feel some bumps when the market falls. So far this year, the fund is down more than 9%. With portfolio turnover at a relatively high 124%, you'll also want to be careful about tax consequences.
With "aggressive" in its name, you should expect this fund to offer some ups and downs in the short term, and you may need a strong stomach to handle that volatility. Nonetheless, Bridgeway Aggressive Investors 2 might be a good fit for those looking to build wealth over time.
Further fund-amental Foolishness:
John Montgomery impressed our Motley Fool Champion Funds team enough for them to recommend three of his funds to our subscribers, including Bridgeway Aggressive Investors 2. Find out which two other Bridgeway funds got our stamp of approval with a free 30-day trial of Champion Funds. If you don't love it, you won't owe a thing.
Fool contributor Zoe Van Schyndel lives in Miami and enjoys the sunshine and variety of the Magic City. She does not own any of the funds or securities mentioned in this article. The Motley Fool has a disclosure policy.