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Jacob Micro Cap Growth Fund

Fund Overview

Ticker:
JMCGX (Class R), JMIGX (Class I)
Fact Sheet:
Investment Category:

Micro Cap Growth

Objective:

The Fund seeks long-term growth of capital.

Investment Minimums:

Initial minimum investment of $2500 for Class R, and $1,000,000 for Class I. Additional minimum investment of $100 for Class R, and $1,000 for Class I.

Investment Strategy:

The Jacob Micro Cap Growth Fund seeks to provide its investors with above average total returns from a broad group of micro capitalization companies that are early in their development and that the Fund believes has significant growth potential. These companies are defined as those with market capitalizations (share price multiplied by number of shares outstanding) of: (1) less than or equal to $600 million; or (2) within the capitalization range of the Russell Micro Cap® Growth Index at the time of purchase.)

The Fund’s portfolio is managed in an aggressive growth style. To achieve its objective, the Fund invests in micro capitalization companies that it believes offer the potential for greater earnings and sales growth potential than larger capitalized companies and may offer substantial opportunities for long-term growth of capital. Overall stock selections are based on a qualitative and quantitative assessment of a company’s fundamental prospects and whether it has an above-average potential for long-term growth of capital. Specifically, the Fund seeks companies with expanding profit margins, sales and earnings growth which, over a business cycle, can be expected to produce high levels of free cash flow. Further, the Fund seeks companies with strong management teams that can capitalize on catalysts for growth and competitive advantages such as superior products and favorable industry, economic and political trends. It is the Fund’s goal to maximize the growth potential of the portfolio while also striving to acquire securities that are selling at a reasonable valuation in view of their expected growth rate.

Daily NAV

08/19/2019
Ticker
JAMFX
JSCGX
JSIGX
JMCGX
JMIGX
NAV
$5.17
$24.03
$24.47
$17.66
$19.31
$ Change
0.05
0.2
0.2
0.06
0.07
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The portfolio managers follow a three-step process to identify and monitor the Fund's investments:

Find

The first step in our investment process is to narrow down the seemingly infinite universe of possibilities and to focus on what we feel are the most attractive opportunities. Accomplishing this step is no easy task. It requires countless hours of research - scouring the Web, reading analyst reports, running quantitative screens, attending conferences, speaking to executives - all in an attempt to find those relatively rare nuggets worth looking into more closely. Sometimes those nuggets are individual companies, and sometimes they are broader themes that can open up a wide range of potential investments.

Filter

Once we find an intriguing investment idea, we then deploy a thorough qualitative and quantitative review process to determine if the opportunity is as attractive as it appears and can be had at a fair price. Very few of our ideas that we uncover end up being part of our concentrated portfolios.

Ideally, we are looking for companies that operate in large markets in which there are significant barriers to entry, enjoy what we believe is a strong competitive position with growing market share, and boast capable management teams with proven track records. We want the companies to have unique assets - such as proprietary technologies or unusually loyal customers - with the possibility that positive near-term catalysts could drive the value of our investment higher.

If everything looks good qualitatively, we turn our focus to valuation. We evaluate many different quantitative criteria including cash flows, income statement and balance sheet items. We determine what a company is likely to generate in sales and profits for the coming years and then, using several different metrics, calculate a fair valuation based on those estimates.

Of course, we also consider the biggest risks to each company's outlook and gauge the likelihood that these potential pitfalls could derail the investment thesis.

Follow-Up

Once we add an investment to one of our portfolios, we continue to monitor the position closely, making sure that our original analysis remains valid. We will often rebalance or potentially exit a position if the risk/reward ratio for the investment changes materially. We also conduct detailed portfolio reviews on a regular basis.


Investments in micro capitalization companies may involve greater risks, as these companies tend to have limited product lines, markets and financial or managerial resources. Micro cap stocks often also have a more limited trading market, such that the Adviser may not be able to sell stocks at an optimal time or price. In addition, less frequently-traded securities may be subject to more abrupt price movements than securities of larger capitalized companies. Investments in foreign securities involve greater volatility and political, economic and currency risks, and differences in accounting methods. These risks are greater in emerging markets.

Cash flow measures the cash generating capability of a company by adding non-cash charges (e.g. depreciation) and interest expense to pretax income.

The Russell Microcap Growth Index measures the performance of the microcap growth segment of the U.S. Equity market. One cannot invest directly in an index.

Total Returns as of Month-End (07/31/2019 ) Total Returns as of Quarter-End (06/30/2019 ) Total Returns as of (06/30/2019 )
Month Quarter 1 Year 3 Years 5 Years Since Inception*
Jacob Micro Cap Growth Fund (Class R) -3.16% 13.34% 29.61% 24.78% 8.96% 10.47%
Jacob Micro Cap Growth Fund (Class I) -3.13% 13.44% 29.82% 25.10% 9.25% 10.78%
Russell Micro Cap Growth Index -2.45% 0.44% -9.78% 9.81% N/A 9.78%

*Inception Date: 10/16/2012
Investor Shares (Class R) Expense Ratio: Gross 3.75% Net 2.65%**
Institutional Shares (Class I) Expense Ratio: Gross 3.51% Net 2.41%**

Performance data quoted represents past performance; past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance of the fund may be lower or higher than the performance quoted. Performance data current to the most recent month end may be obtained by calling 888-522-6939.

The fund imposes a 2.00% redemption fee on shares held less than 30 days. Performance data does not reflect the redemption fee. If reflected, returns would be lower. The fund imposes neither a maximum sales charge on purchases nor a maximum deferred sales charge.

**The advisor has contractually agreed to waive fees through January 2, 2020.


Investments in micro capitalization companies may involve greater risks, as these companies tend to have limited product lines, markets and financial or managerial resources. Micro cap stocks often also have a more limited trading market, such that the Adviser may not be able to sell stocks at an optimal time or price. In addition, less frequently-traded securities may be subject to more abrupt price movements than securities of larger capitalized companies. Investments in foreign securities involve greater volatility and political, economic and currency risks, and differences in accounting methods. These risks are greater in emerging markets.

Cash flow measures the cash generating capability of a company by adding non-cash charges (e.g. depreciation) and interest expense to pretax income.

The Russell Microcap Growth Index measures the performance of the microcap growth segment of the U.S. Equity market. One cannot invest directly in an index.

Fund Holdings as of June 30, 2019

Company Name Symbol $ Market Value % of Net Assets
Alphatec Holdings Inc ATEC 937,510.00 6.42
ID Systems Inc IDSY 750,282.12 5.14
Digital Turbine Inc APPS 721,500.00 4.94
Rafael Hldgs Inc RFL 690,000.00 4.73
Aspen Aerogels Inc ASPN 677,350.00 4.64
Icad Inc ICAD 663,499.20 4.55
Harrow Health Inc HROW 577,584.30 3.96
Codexis Inc CDXS 571,440.58 3.91
USA Technologies USAT 512,670.00 3.51
Caredx Inc CDNA 433,067.67 2.97
Lantronix Inc LTRX 425,837.07 2.92
Optimizerx Corp OPRX 417,846.60 2.86
Optimizerx Corp OPRX 366,174.27 2.79
Krystal Biotech Inc KRYS 358,403.00 2.46
Mitek Sys Inc MITK 357,094.50 2.45
Immersion Corp IMMR 352,906.14 2.42
BJS Restaurants BJRI 290,004.00 1.99
Ceva Inc CEVA 278,564.00 1.91
Diamedica Therapeutics Inc DMAC 272,800.00 1.87
Tillys Inc TLYS 250,264.00 1.71
RTW Retailwinds Inc RTW 249,900.00 1.71
Ritter Pharmaceuticals Inc RTTR 235,400.00 1.61
Medicine Man Technologies Inc Com MDCL 226,800.00 1.55
Sharpspring Inc SHSP 220,830.00 1.51
First Internet Bancorp INBK 220,031.10 1.51
Omeros Corp OMER 219,660.00 1.50
Esperion Therapeutics Inc ESPR 218,644.00 1.50
First Northwest Bancorp FNWB 218,367.50 1.50
Red Lion Hotels Corp RLH 201,924.00 1.38
Energy Recovery Inc ERII 171,930.00 1.18
Intersect Ent Inc XENT 159,320.00 1.09
Izea Worldwide Inc IZEA 152,431.85 1.04
Reeds Inc REED 151,200.00 1.04
IMV Inc IMV 145,500.00 1.00
Impinj Inc PI 143,100.00 0.98
Leju Hldgs Ltd LEJU 137,500.00 0.94
Chemocentryx Inc CCXI 132,060.00 0.90
Chuys Hldgs Inc CHUY 123,768.00 0.85
Ring Energy Inc REI 122,850.00 0.84
Thescore Inc - A TSCRF 121,492.12 0.83
Chromadex Corp CDXC 116,250.00 0.80
Instructure Inc INST 110,500.00 0.76
Lithium Amers Corp New LAC 106,920.00 0.73
Tabula Rasa Healthcare Inc TRHC 104,853.00 0.72
Build a Bear Workshop BBW 100,620.00 0.69
Inspired Entmt Inc INSE 100,436.00 0.69
Ramaco Res Inc METC 85,120.00 0.58
Orocobre Ltd OROCF 77,220.00 0.53
Netlist Inc NLST 73,600.00 0.50
Solitario Zinc Corp XPL 70,466.00 0.48
Nemaska Lithium Inc NMX 26,293.01 0.18
Advantage Lithium Corp AAL 22,918.28 0.16
Tearlab Warrants TEAR 0.00 0.00

Fund holdings and sector allocations are subject to change and are not a recommendation to buy or sell any security.

By clicking on the company names, you will be leaving the Jacob Funds website and will be entering a third-party website. Jacob Funds is not responsible for, nor can guarantee, the accuracy of any information contained on a third party site.


Investments in micro capitalization companies may involve greater risks, as these companies tend to have limited product lines, markets and financial or managerial resources. Micro cap stocks often also have a more limited trading market, such that the Adviser may not be able to sell stocks at an optimal time or price. In addition, less frequently-traded securities may be subject to more abrupt price movements than securities of larger capitalized companies. Investments in foreign securities involve greater volatility and political, economic and currency risks, and differences in accounting methods. These risks are greater in emerging markets.

Cash flow measures the cash generating capability of a company by adding non-cash charges (e.g. depreciation) and interest expense to pretax income.

The Russell Microcap Growth Index measures the performance of the microcap growth segment of the U.S. Equity market. One cannot invest directly in an index.

Please refer to the linked fund fact sheet for a current breakdown of the fund's sector allocation.

Sectors as of August 31, 2017

Sector Name %
Common Stocks 92.3
Money Market Fund   6.9
Other Assets in Excess of LIabilities   0.7

 

Fund holdings and sector allocations are subject to change and are not a recommendation to buy or sell any security.


Investments in micro capitalization companies may involve greater risks, as these companies tend to have limited product lines, markets and financial or managerial resources. Micro cap stocks often also have a more limited trading market, such that the Adviser may not be able to sell stocks at an optimal time or price. In addition, less frequently-traded securities may be subject to more abrupt price movements than securities of larger capitalized companies. Investments in foreign securities involve greater volatility and political, economic and currency risks, and differences in accounting methods. These risks are greater in emerging markets.

Cash flow measures the cash generating capability of a company by adding non-cash charges (e.g. depreciation) and interest expense to pretax income.

The Russell Microcap Growth Index measures the performance of the microcap growth segment of the U.S. Equity market. One cannot invest directly in an index.

JACOB FUNDS




Please note that the Jacob Funds referred to in this website are offered and sold only to United States residents, and the information on this website is intended only for such people. The Fund is not offered for sale in countries other than the U.S. and it territories. This website should not be considered a solicitation to buy or an offer to sell shares of the Jacob Funds in any jurisdiction where it would be unlawful under the securities law of that jurisdiction.

Each fund's investment objectives, risks, charges, expenses and other information are described in the prospectuses, which must be read and considered carefully before investing. You may download the prospectus or obtain a hard copy by calling 888-522-6239.

Mutual fund investing involves risk. Principal loss is possible.

There are risks inherent in investing in the Internet area, particularly with respect to smaller capitalized companies and the high volatility of internet stocks. Small- and Medium-capitalization companies tend to have limited liquidity and greater price volatility than large-capitalization companies. Investments in foreign securities involve greater volatility and political, economic and currency risks and differences in accounting methods. The Internet Fund may invest in debt securities which typically decrease in value when interest rates rise. This risk is usually greater for longer-term debt securities. Investments in micro-capitalization companies may involve greater risks, as these companies ten to have limited product lines, markets and financial or managerial resources. Microcap stocks often also have a more limited trading market, such that the Adviser may not be able to sell stocks at an optimal time or price. In addition, less frequently-traded securities may be subject to more abrupt price movements than securities of larger capitalized companies. The Small Cap Growth Fund invests in smaller companies, which involve additional risks, such as limited liquidity and greater volatility.

Jacob Funds are distributed by Quasar Distributors, LLC.