Value Fund Highlights RLI Corp.’s 20% ROE, Shares at $62.43 after 5.2% Monthly Gain
FPA Queens Road Small Cap Value Fund returned -0.36% in Q4 2025 versus the Russell 2000 Value Index’s 3.26% while posting a 13.36% gain for 2025 against the index’s 12.59%. The fund highlighted RLI Corp.’s sub-90% combined ratios, near-20% ROE and noted shares closed at $62.43 on February 12 after a 5.19% one-month gain.
1. Fund Performance Overview
The FPA Queens Road Small Cap Value Fund reported a -0.36% return in the fourth quarter of 2025 compared with a 3.26% gain for the Russell 2000 Value Index. For the full year 2025, the fund outpaced the index with a 13.36% return versus 12.59%, driven by quality and value holdings.
2. RLI Stock Metrics
RLI Corp. shares closed at $62.43 on February 12, reflecting a 5.19% increase over the past month but a 16.92% decline over the last 12 months. The insurer’s $5.736 billion market capitalization and inclusion among the fund’s top five holdings underscore its strategic importance.
3. Business Strengths and Valuation Opportunity
RLI Corp. operates niche insurance lines such as school bus, Hawaii homeowners and construction surety, delivering combined ratios below 90% and ROE near 20%. The fund sees an uncrowded valuation ahead of potential upside, noting long-term earnings growth outpacing share price appreciation and disciplined capital deployment.