Christopher Franz: Silver-rated LKCM Equity and Bronze-rated LKCM Small Cap Equity share several similarities. Offerings of Fort Worth, Texas, boutique Luther King Capital Management, the funds concentrate their holdings in high-quality companies with sustainable competitive advantages, boasting lengthy track records, and experienced lead managers.
Firm founder and president Luther King has been the lead manager of LKCM Equity since its 1996 inception. He's supported by three additional managers including Steve Purvis, who has led LKCM Small Cap since 1999. Both managers personally invest in their funds. King and Purvis are supported by a large analyst team organized by sector and market cap.
Although the teams and processes are similar, the funds are differentiated by market cap. LKCM Equity falls in the Large Growth Morningstar Category, but as it features an all-cap approach, it has a much lower weighted average market cap than its S&P 500 benchmark. The fund is a suitable core holding in an investor's portfolio. LKCM Small Cap benchmarks to the Russell 2000 Index, and its focus on small-cap stocks makes it a supporting player.
While the funds' recent performance has been challenged, their strong long-term records and low fee structures make them attractive options.