Fund name: Presidio Fund (PRSDX)

Objective: the fund seeks long-term growth of capital by investing in publicly-traded US firms and in exchange-traded funds (ETFs). The fund is non-diversified and can, but currently does not, invest in foreign stocks and in bonds.

Adviser: KCO Investments, Inc. is the investment adviser of the Fund

Manager: Kevin C. O'Boyle. Mr. O’Boyle managed the Meridian Value fund from 1994 until the end of 2003. The Meridian Value Fund was designated by Lipper as the Best Small-Cap Value Fund for five-year performance in 1999, and the Best Mid-Cap Value Fund for five-year performance from 2000 through 2003. The Meridian Value Fund was also included in the Money 100 list of Best Mutual Funds in 2001 and 2002.

Opening date: May 3, 2005.

Minimum investment: $10,000 for regular accounts, $3000 for IRAs. The account minimum is reduced to $5000 for investors willing to set up a monthly automatic investment of at least $100.

Expense ratio: 1.50% on a $35 million asset base.

Comments: it probably says something about investors’ current state of mind that Presidio – with a manager boasting spectacular credentials at a fund substantially similar to this fund -- has drawn less than $35 million in assets after more than a year of operation. Just two years before, Wasatch Micro-Cap Value – with similarly distinguished managers – drew $70 million in assets in a single day. But investors’ interests have shifted away from small caps and toward exotica: almost-hedge-funds, semi-active ETFs and the like.

Nonetheless, Presidio warrants some attention. It represents a rare opportunity to tap into the potential that Meridian Value represented when it was one-fiftieth of its current size. It allows O’Boyle to invest in companies that meet his value criteria – typically market leaders located in high-growth industries, which have suffered two or more quarters of earnings disappointments – but which were too small to make a difference to Meridian. It’s O’Boyle’s willingness to replicate much of Meridian Value’s strategy that leads us to categorize this tiny, year-old fund as a "star in the shadows" rather than a promising rookie.

O’Boyle’s formula worked well at Meridian. Returns during his nine-year tenure were at the top of the small-cap group and then, as the fund’s swelling assets forced a change in focus, at the top of its mid-cap group. It nevertheless produced noticeably below-average volatility.

Bottom Line: Presidio commands Mr. O’Boyle’s full attention. He’s got well over a million of his own dollars in the fund and he’s chosen to manage neither a hedge fund nor separately-managed accounts (both common paths by which managers extend their financial reach). If his success at Meridian was due to luck he was, at the very least, quite consistently lucky: he outpaced his peers in seven of nine years – frequently by double-digit margins – and produced 20+% returns in the two years that he lagged his peers. While he’s not limited by market caps, his traditional grounds have been small- to mid-cap stocks, which positions Presidio as a valuable complement to a portfolio rich in large cap stocks.