Baron Real Estate Fund (BREIX)

Portfolio Management

JeffreyKolitch
Jeffrey Kolitch

Fund Manager since 2009

Objective and Strategy

The investment goal of Baron Real Estate Fund is capital appreciation.

The Fund invests broadly in real estate businesses with significant growth potential. It maintains exposure across many industries and all capitalization ranges. Non-diversified.

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Fund Description

Baron Real Estate Fund invests in securities of real estate and real estate related companies of all sizes.

  

Performance Summary as of July 31, 2014

  Annualized Returns Since Inception
12/31/09
YTD 1 YR 3 YR 5 YR 10 YR Annualized Cumulative
7.18% 20.15% 21.74% N/A N/A 22.12% 149.91%
Growth of $10,000 Chart

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Top Ten Holdings as of July 31, 2014

Holding Sector Percentage
Brookdale Senior Living, Inc. Health Care 9.9%
Starwood Hotels & Resorts Worldwide, Inc. Consumer Discretionary 4.8%
Home Depot, Inc. Consumer Discretionary 3.9%
Wyndham Worldwide Corp. Consumer Discretionary 3.8%
Hyatt Hotels Corp. Consumer Discretionary 3.7%
Capital Senior Living Corp. Health Care 3.7%
CBRE Group, Inc. Financials 3.6%
Jones Lang LaSalle, Inc. Financials 3.4%
Wynn Resorts Ltd. Consumer Discretionary 3.1%
Las Vegas Sands Corp. Consumer Discretionary 3.0%
Total 42.9%
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Performance Based Characteristics as of June 30, 2014

Characteristics 3 Years 5 Years 10 Years Since Inception
Standard Deviation (%) 17.33 17.13
Sharpe Ratio 1.36 1.36
Alpha (%) 6.50 6.44
Beta 1.08 0.98
R-Squared (%) 87.03 87.81
Tracking Error (%) 6.26 5.93
Information Ratio 1.33 1.16
Upside Capture (%) 122.10 111.06
Downside Capture (%) 91.48 84.15

Daily Price (NAV)

Prices for Aug 29 , 2014
(BREIX)
NAV $25.07
Daily Change ($) $0.10
Daily Change (%) 0.40%
MTD 4.28%
YTD 11.77%
52-Week High $25.07
52-Week Low $19.62

Fund Facts

Inception Date December 31, 2009
Net Assets^ $1.44 billion
CUSIP 06828M801
Expense Ratio* 1.09%
Risk/Return Comparison
Risk Return Graph

Baron Real Estate Fund is non-diversified, which means the volatility of the Fund’s returns may increase and expose the Fund to greater risk of loss in any given period. In addition to general market conditions, the value of the Fund will be affected by the strength of the real estate markets as well as by interest rate fluctuations, credit risk, environmental issues and economic conditions. The Fund invests in companies of all sizes, including small and medium sized companies whose securities may be thinly traded and more difficult to sell during market downturns.

Ratings/Rankings

Morningstar Ratings
Ratings based on risk-adjusted returns as of 6/30/2014
Category: US OE Real Estate
Overall 5 Stars out of 222 funds
3 Year 5 Stars out of 222 funds

The Overall Morningstar Rating for a fund is derived from a weighted-average of the performance figures associated with its three-, five- and (if applicable) ten-year ratings.

Lipper Rankings

This information is not currently available.

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Baron Category: All-Cap Growth
Large Value Large Core Large Growth Large
Mid Value Mid Core Mid Growth Mid
Small Value Small Core Small Growth Small
Value Core Growth  
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Performance data quoted represents past performance. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate; an investor's shares, when redeemed, may be worth more or less than their original cost. The Adviser has reimbursed certain Fund expenses and the Fund's transfer agency expenses may be reduced by expense offsets from an unaffiliated transfer agent, without which performance would have been lower. Current performance may be lower or higher than the performance data quoted above. For performance information current to the most recent month end, click here.

The Fund may not achieve its objectives.

^All share classes combined. As of most recent month end.

*As of fiscal year ended 12/31/2013 the expense ratio of the Fund's Institutional Shares was 1.09%.

Percentage based on net assets. Current and future portfolio holdings may change over time.

Industry sector or sub-industry group levels are provided from the Global Industry Classification Standard ("GICS"), developed and exclusively owned by MSCI, Inc. ("MSCI") and Standard & Poor's Financial Services LLC ("S&P"), unless otherwise stated that they have been reclassified or classified by the Adviser. All GICS data is provided "as is" with no warranties.
 
For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a fund's monthly performance (including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each 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. (Each share class is counted as a fraction of one fund within this scale and rated separately, which may cause slight variations in the distribution percentages.) © 2014 Morningstar, Inc.  All Rights Reserved.  The Morningstar information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely.  Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.

Lipper Analytical Services, Inc. rankings and fund performance do not reflect sales charges and are based on total return, including reinvestment of dividends and capital gains for the stated periods.

Performance Based Characteristics are based on trailing five-year and since-inception periods. Performance statistics for additional periods will be provided on request.Source: FactSet SPAR.

Definitions (provided by BAMCO, Inc.): The indexes are unmanaged. The MSCI USA IMI Extended Real Estate Index is a custom index calculated by MSCI for, and as requested by, BAMCO, Inc.  The index includes real estate and real estate-related GICS classification securities.  MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein.  The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products.  This report is not approved, reviewed or produced by MSCI.  The S&P 500 Index measures the performance of 500 widely held large-cap U.S. companies. The indexes and the Fund include reinvestment of interest, capital gains and dividends, which positively impact the performance results. The Morningstar Real Estate Average is not weighted and represents the straight average of annualized returns of each of the funds in the Real Estate category. The Fund's Institutional Shares have been included in the category since December 31, 2010. © 2014 Morningstar, Inc.  All Rights Reserved.  The Morningstar information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely.  Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. This information does not constitute an offer to sell or a solicitation of any offer to buy securities by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation. Standard Deviation: measures the degree to which a fund’s performance has varied from its average performance over a particular time period. The greater the standard deviation, the greater a fund’s volatility (risk). Sharpe Ratio: is a risk-adjusted performance statistic that measures reward per unit of risk. The higher the Sharpe ratio, the better a fund’s risk adjusted performance. Alpha: measures the difference between a fund’s actual returns and its expected performance, given its level of risk as measured by beta. Beta: measures a fund’s sensitivity to market movements. The beta of the market (Russell 2000 Growth Index) is 1.00 by definition. R-Squared: measures how closely a fund’s performance correlates to the performance of the benchmark index (Russell 2000 Growth Index), and thus is a measurement of what portion of its performance can be explained by the performance of the index. Values for R-Squared range from 0 to 100, where 0 indicates no correlation and 100 indicates perfect correlation. Tracking Error: measures how closely a fund’s return follows the benchmark index returns (Russell 2000 Growth Index). It is calculated as the annualized standard deviation of the difference between the fund and the index returns. Information Ratio: measures the excess return of a fund divided by the amount of risk the fund takes relative to the benchmark index (Russell 2000 Growth Index). The higher the information ratio, the higher the excess return expected of the fund, given the amount of risk involved.  Upside Capture %: explains how well a fund performs in time periods where the benchmark’s returns (Russell 2000 Growth Index) are greater than zero. Downside Capture %: explains how well a fund performs in time periods where the benchmark’s returns (Russell 2000 Growth Index) are less than zero. EPS Growth Rate (3-5 year forecast): indicates the long-term forecasted EPS growth of the companies in the portfolio, calculated using the weighted average of the available 3-to-5 year forecasted growth rates for each of the stocks in the portfolio provided by Factset Estimates. The EPS Growth rate does not forecast the Fund’s performance. Price/Earnings Ratio (trailing 12-months): is a valuation ratio of a company’s current share price compared to its actual earnings per share over the last twelve months. Price/Book Ratio: is a ratio used to compare a company’s stock price to its tangible assets, and it is calculated by dividing the current closing price of the stock by the latest quarter’s book value per share. Price/Sales Ratio: is a valuation ratio of a stock’s price relative to its past performance. It represents the amount an investor is willing to pay for a dollar generated from a particular company’s operations. Price/Sales is calculated by dividing a stock’s current price by its revenue per share for the last 12 months. Weighted Harmonic Average: is a calculation that reduces the impact of extreme observations on the aggregate calculation by weighting them based on their size in the fund. This information does not constitute an offer to sell or a solicitation of any offer to buy securities by anyone in any jurisdiction where it would be unlawful under the laws of that jurisdiction to make such offer or solicitation.