The curated database of hedge funds that publish investor letters. Research by geography, strategy, and schools of thought.
| # | Fund | Strategy | Style | Geography | AUM | Latest Letter |
|---|---|---|---|---|---|---|
As of Oct 12, 2026
The FAM Small Cap Fund posted a net return of -0.67% for the third quarter of 2026, substantially outperforming its primary benchmark, the Russell 2000 Index, which tumbled -7.23%. Over the trailing one-year period, the strategy delivered a net return of -6.15% compared to 16.20% for the index. Relative outperformance during the quarter was driven by minimal strategy exposure to unprofitable, lower-quality industrial and technology enterprises, alongside positive M&A developments within portfolio holdings. Broad market breadth remained unusually narrow, with speculative small-cap issues and loss-making benchmark constituents driving index distortions. From a macroeconomic standpoint, the management team highlighted persistent inflationary pressures, elevated borrowing costs, and rising energy prices following geopolitical disruptions in the Middle East. With the Federal Reserve raising the target federal funds rate to a range of 3.75% to 4.00% and the 10-year Treasury yield touching a 19-year peak of 5.29%, capital costs have materially escalated across corporate balance sheets. In response, Fenimore emphasizes fundamental resilience, maintaining a disciplined investment framework centered on balance sheet strength, pricing power, and sustained free cash flow generation over speculative market trends. Portfolio activity was active during the quarter. Capital was redeployed from acquired positions in CBIZ Inc. and Baldwin Insurance Group into new initiations including Mobility Global, Houlihan Lokey, Element Solutions, and Stevanato Group. Additionally, the team added to existing high-conviction holdings including Colliers International Group, ESAB Corp., Floor & Decor Holdings, FirstService Corp., and SiteOne Landscape Supply, focusing on businesses capable of reinvesting capital at elevated rates of return across cycles.
Fenimore invests in high-quality, cash-generative small-cap businesses with durable competitive advantages, clean balance sheets, and proven capital-allocating management teams trading at an attractive margin of safety.
Fenimore maintains that narrow market leadership and performance dispersion create attractive selective entry points for high-quality businesses whose share prices do not reflect long-term potential. The team intends to continue identifying enterprises with durable competitive moats, solid balance sheets, and strong capital allocation discipline while taking advantage of market dislocations.
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