Mutual Fund Commentary

Intrepid Capital Fund

1Q 2024

April 1, 2024

“Most investors do today, what they should have done yesterday.”

-Lawrence Summers, Former US Treasury Secretary

Dear Fellow Shareholders,

In our last letter, we were pleased to communicate a successful result for the final quarter of calendar 2023. The first quarter of calendar 2024 kept the streak alive with a another quarter of returns greater than 6% (6.25% to be exact) – closely matching the return in the prior period (6.41%). Returns for the trailing 12 months ending March 31, 2024, were 16.98%.

These returns have been against a backdrop of “how many rate cuts, and when do they start?” speculation from Wall Street pundits. The anticipation of lower rates has powered the equity markets higher since October of 2023.

However, that perception is starting to change as we enter April due to recent inflation and employment numbers coming in “hotter” than the markets anticipated. I have asked the question internally: “what if they don’t cut rates”?

As we discussed in our last communication, the silly season (aka Presidential race) is upon us and the Federal Reserve is running out of time if they want to try to be apolitical and not cut short term rates close to the November election. These inflation and unemployment numbers keep pushing back the date for this to occur.

Due to i) a drop in the official inflation rate from 9% in June 2022 to 3.8% in March 2024, and ii) a record low unemployment rate. I would have thought the President would be polling much stronger than he is. I read recently that, since January 2021 (President’s Biden inauguration), consumer prices across the board were up roughly 20% and is likely what voters have anchored on. I always thought only government statisticians could come up with a “core” inflation number that excluded food and gas, which only applies to the citizens that don’t drive or eat!

I continue to position the Intrepid Capital Fund as an “all-weather tire” by minding the allocation between stocks, bonds and cash (or, better said, money market funds). This stays very consistent with roughly 60% of the Fund dedicated to stock holdings, 35% devoted to bonds, and a residual of ~5% in cash (money market). This is an attempt to deliver an attractive risk/return profile with both growth and income.

In a quarter like we just experienced, one might guess there were few meaningful detractors and that was certainly the case for the Fund in Q1 of 2024.

The top Contributors were Acuity Brands (AYI), Copart (CPRT), Berkshire Hathaway – Class B (BRK/B). The top detractors were Dropbox – Class A (DBX) and WNS Holdings (WNS).

Thank you for your continued support! If there is anything we can do to serve you better, please don’t hesitate to call.

All the best,



Mark F. Travis, President
Intrepid Income Fund Co-Portfolio Manager

Past performance is not a guarantee of future results.
Mutual fund investing involves risk. Principal loss is possible. The Fund is subject to special risks including volatility due to investments in smaller companies, which involve additional risks such as limited liquidity and greater volatility. Investments in debt securities typically decrease in value when interest rates rise. This risk is usually greater for longer-term debt securities. Investments by the Fund in lower-rated and non-rated securities present a greater risk of loss to principal and interest than higher-rated securities. The Fund may invest in foreign securities which involve greater volatility and political, economic and currency risks and differences in accounting methods. The risks of owning ETFs generally reflect the risks of owning the underlying securities they are designed to track. ETFs also have management fees that increase their costs versus the costs of owning the underlying securities directly..
The Funds’ investment objectives, risks, charges and expenses must be considered carefully before investing. The prospectus contains this and other important information about the investment company. Please read it carefully before investing. A hard copy of the prospectus can be requested by calling 866-996-FUND (3863).
The S&P 500 Index is a broad-based, unmanaged index of 500 stocks, which is widely recognized as representative of the equity market in general. The Bloomberg US Gov/Credit 1-5Y TR Index measures the performance of U.S. dollar-denominated U.S. Treasury bonds, government-related bonds, and investment-grade U.S. corporate bonds that have a remaining maturity of greater than or equal to one year and less than five years. The Bloomberg (BBC) Combined Index consists of an unmanaged portfolio of 60% common stocks represented by the S&P 500 Index and 40% bonds represented by the Bloomberg US Government/Credit 1-5 Yr Index. You cannot invest directly in an index.
The Consumer Price Index (CPI) measures the monthly change in prices paid by U.S. consumers. Duration is an approximate measure of the price sensitivity of a fixed-income investment to a change in interest rates, expressed as a number of years. Basis point is a standard financial measure for interest rates. One basis point equals 1/100th of 1%.
Opinions expressed are subject to change, are not guaranteed and should not be considered investment advice or recommendations to buy or sell any security.
The Intrepid Capital Funds are distributed by Quasar Distributors, LLC.
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