Value Line Mid Cap Focused Fund
| Value Line Mid Cap Focused Fund | |
|---|---|
| Investor Class | VLIFX |
| Institutional Class | VLMIX |
| AUM | $1875M |
Stephen E. Grant Senior Portfolio Manager
* The Adviser and EULAV Securities LLC, the Fund’s principal underwriter (the “Distributor”), have agreed to waive certain class-specific fees and/or pay certain class-specific expenses incurred by the Institutional Class so that the Institutional Class bears its class-specific fees and expenses at the same percentage of its average daily net assets as the Investor Class’s class-specific fees and expenses (excluding 12b-1 fees and any extraordinary expenses incurred in different amounts by the classes) (the “Expense Limitation”). The information regarding the Institutional Class in the table has been restated to reflect the Expense Limitation. The Adviser and the Distributor may subsequently recover from assets attributable to the Institutional Class the reimbursed expenses and/or waived fees (within 3 years after the fiscal year end in which the waiver/reimbursement occurred) to the extent that the Institutional Class’s expense ratio is less than the Expense Limitation or, if lower, the expense limitation in effect when the waiver/reimbursement occurred. The Expense Limitation can be terminated or modified before June 30, 2019 only with the agreement of the Fund’s board. The Fund's performance would be lower in the absence of such waivers.
As of 12/31/24, the Fund’s Top 10 Holdings were as follows:
Tyler Technologies Inc (5.73%),
MSCI Inc (5.55%),
Heico Corp (5.35%),
Lennox International Inc (4.99%),
Waste Connections Inc (4.90%),
Gartner Inc (4.80%),
Fair Isaac Corp (4.44%),
Monolithic Power Systems Inc (3.54%),
TransDigm Group Inc (3.35%),
Casey's General Stores Inc (3.29%)
There are risks associated with investing in small and mid cap stocks, which tend to be more volatile and less liquid than stocks of large companies, including the risk of price fluctuations.
The performance data quoted herein represents past performance and does not guarantee future results. Market volatility can dramatically impact the fund's short term performance. Current performance may be lower or higher than figures shown. The investment return and principal value will fluctuate so that an investor's shares, when redeemed may be worth more or less than their original cost. Past performance data through the most recent month end is available at vlfunds.com or by calling 1-800-243-2729.
You should carefully consider investment objectives, risks, charges and expenses of Value Line Funds before investing. This and other information can be found in the fund's prospectus and summary prospectus, which can be obtained free of charge from your investment representative, by calling 800.243.2729, or by clicking on the applicable fund at www.vlfunds.com. Please read it carefully before you invest or send money. Value Line Funds are distributed by EULAV Securities LLC. Past performance is no guarantee of future results.
Portfolio holdings are subject to change and should not be considered a recommendation to buy or sell securities. Current and future portfolio holdings are subject to risk.
The average annual returns shown above are historical and reflect changes in share price, reinvested dividends and are net of expenses. Investment results and the principal value of an investment will vary.
The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product 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. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three- year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
VLEOX (3 Year / 5 stars / 535 funds; 5 Year / 5 stars / 519 funds; 10 Year / 5 stars / 395 funds; )
VLIFX (3 Year / 5 stars / 480 funds; 5 Year / 5 stars / 442 funds; 10 Year / 5 stars / 358 funds; )
VALLX (3 Year / 2 stars / 1026 funds; 5 Year / 2 stars / 945 funds; 10 Year / 2 stars / 742 funds; )
VALSX (3 Year / 3 stars / 1026 funds; 5 Year / 2 stars / 945 funds; 10 Year / 3 stars / 742 funds; )
VLAAX (3 Year / 5 stars / 679 funds; 5 Year / 3 stars / 627 funds; 10 Year / 5 stars / 485 funds; )
VALIX (3 Year / 3 stars / 679 funds; 5 Year / 3 stars / 627 funds; 10 Year / 4 stars / 485 funds; )
VAGIX (3 Year / 2 stars / 424 funds; 5 Year / 1 stars / 381 funds; 10 Year / 2 stars / 272 funds; )
Source: Morningstar Direct
Would you please comment on the Fund’s performance relative to the Morningstar Mid-Cap Growth Category for the 1-year period ended December 31, 2024, as well as longer-term periods?
For the 1-year period, the Fund’s return of 7.62% underperformed the Morningstar Mid- Cap Growth Category average return of 16.47%. While we are never satisfied with relative underperformance, we believe that the Fund’s results over longer periods are more important to investors.
The Fund has outperformed over longer periods, and with lower risk. In fact, the Fund is the only fund (among 106 unique Morningstar Mid-Cap Growth funds) that has achieved top quintile (20% or better) performance for the 3, 5 and 10-year periods, while maintaining Morningstar’s “Low” Risk Rating for the same periods, as of December 31, 2024.
Please visit the Fund’s performance page for complete performance information.
Source: Morningstar as of 12/31/24
Would you please expand on the Fund’s risk profile?
We believe that managing risk is important, and our investment process emphasizes companies with a long-term track record of consistent operating results. The Fund generally does not invest in speculative or headline grabbing mid-cap companies. Rather, the portfolio is comprised of fundamentally sound mid-cap companies that have 10+ years of consistent growth in both stock price and earnings. As a result, the portfolio has experienced less volatility compared to our Morningstar category peers.
When looking at standard deviation, a measure of volatility, the Fund ranks the lowest among its peers in the Morningstar Mid-Cap Growth Category for the 3, 5 and 10-year periods ended December 31, 2024.
Source: Morningstar as of 12/31/24
What are some examples of the types of companies your investment process favors?
When selecting companies for investment, we emphasize those with steady operating results and a long-term track record of consistent growth in both stock price and earnings. We believe this type of track record indicates that a company has strong, talented management, and can operate successfully in a variety of economic environments. As patient, long-term investors, many of our portfolio holdings have been owned in the Fund for long-term periods as well. Two portfolio examples include the following: