I’m starting to get a bit concerned about this concentrated value fund managed by Francis Chou. After stellar years in 2012 and 2013 performance appears to be slowing. It struggled in the second quarter largely the result of its holdings in three stocks; Resolute Forest Products, Sears Holdings, and MBIA Inc. Combined, these three names make up 24% of the fund. This highlights the dangers of a concentrated portfolio in that there is nowhere to hide if the markets want to punish a few of your holdings. Short term, there may be some more pain for the fund, however, over the longer term Mr. Chou has proven to be one of the strongest value investors in the country. If you have a long term time horizon you’ll likely do very well with this fund. If you don’t, you may want to take this time to find something a little more diversified.