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Form N-CSRS WEITZ FUNDS For: Sep 30

November 9, 2018 11:01 AM EST
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SEMI-ANNUAL SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-21410
The Weitz Funds
 (Exact name of registrant as specified in charter)
Suite 200
1125 South 103 Street
Omaha, NE 68124-1071
(Address of principal executive offices) (Zip code)
Weitz Investment Management, Inc.
The Weitz Funds
Suite 200
1125 South 103 Street
Omaha, NE 68124-1071
(Name and address of agent for service)
Registrant’s telephone number, including area code: 1-402-391-1980
Date of fiscal year end: March 31
Date of reporting period: September 30, 2018
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.

A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
 

Item 1. Report to Stockholders.




THE WEITZ PHILOSOPHY
Value investing the Weitz Way.
There are no shortcuts in value investing. At Weitz, we dig. And dig some more. We look at hundreds of investment ideas. Our goal: find strong, well-managed but undervalued companies and bonds that offer reasonable risk-adjusted returns. It’s no easy task. We do the due diligence. Analyze. Ask tough questions and get the answers. We wait for the right opportunity. Then and only then do we invest your money. Welcome to the Weitz Way.
We’re in it with you:
Our employees have the majority of their investable assets in our mutual funds. This alignment of goals allows us to guarantee that we’re treating clients’ money as if it were our own.
We focus on what we know:
Each of our analysts is a generalist with ever-growing, defined circles of competence. They can spot opportunities anywhere and bring them to the team for consideration.
We think for ourselves:
Our philosophy of independent thinking and high-conviction portfolios enables us to take advantage of value-priced equities and bonds that offer reasonable risk-adjusted returns.
Today we are responsible for approximately $4 billion in investments for our shareholders – individuals, corporations, pension plans, foundations and endowments. And our commitment remains the same: to put our clients first. Always. We do so through our expertise, our flexibility, and our drive to uncover investments that can help them preserve and grow wealth.
Wally Weitz, CFA
President, Portfolio Manager
 
 
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TABLE OF CONTENTS
   
Value Matters 
4 
   
Performance Summary 
7 
   
Analyst Corner 
8 
   
Value Fund 
10 
   
Partners Value Fund 
12 
   
Partners III Opportunity Fund 
14 
   
Hickory Fund 
16 
   
Balanced Fund 
18 
   
Core Plus Income Fund 
20 
   
Short Duration Income Fund 
23 
   
Ultra Short Government Fund 
26 
   
Nebraska Tax-Free Income Fund 
27 
   
Schedule of Investments 
30 
   
Financial Statements 
46 
   
Notes to Financial Statements 
56 
   
Actual and Hypothetical Expenses for Comparison Purposes 
65 
   
Other Information 
66 
   
Index Descriptions 
70 
 

The management of Weitz Funds has chosen paper for the 72 page report from a paper manufacturer certified under the Sustainable Forestry Initiative ® standard.
 
Portfolio composition is subject to change at any time and references to specific securities, industries, and sectors referenced in this report are not recommendations to purchase or sell any particular security. Current and future portfolio holdings are subject to risk. See the Schedules of Investments included in this report for the percent of assets in each of the Funds invested in particular industries or sectors.
 
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VALUE MATTERS
October 2, 2018
Dear Fellow Investor,
The 3rd quarter of 2018 was a strong one for the U.S. stock market. As value investors, we focus on the long term and our somewhat defensive posture continued to hold us back from full market participation. Over the last few years, we have refused to join the bandwagon of a “momentum” market in which increasing amounts of investment capital is funneled into the stocks that are going up the most. Eventually, valuation trumps momentum, but in the meantime, disciplined price sensitivity has not been rewarded.
The bond market was “choppy.” The Fed continued to slowly unwind its extraordinarily stimulative monetary policy, and despite huge investor demand for even the weakest credits, yields ticked up. This made for rough sledding for bond investors. We feel good that our bond funds held their own, thanks to their conservative positioning. Core Plus, in particular, distinguished itself relative to its peers. We recommend shareholders read the quarterly commentary for Core Plus as well as those of the other funds.
The performance table following this letter shows investment results for all our funds for various intervals over the past 35 years.
In the balance of this letter, we will describe how we are investing in the 10th year of this equity bull market. When asset prices are high and macroeconomic and political forces are mixed, at best, it is especially important to remain focused on what our companies are likely to be worth in 5-10 years. We are confident we can continue to invest successfully in this expensive market without abandoning our principles.
Our Game Plan
U.S. stock investors have many good reasons for enthusiasm. The economy is growing. Corporate tax rates have been cut sharply. The current administration is intent on reducing or eliminating regulations that businesses find burdensome and expensive. Credit is cheap and readily available on easy terms. Psychologically, ten years of bull market gains tend to bolster confidence. The policies that have created these conditions will surely have some unintended consequences, but for now, they are investment positives.
Many stock markets outside the U.S. are suffering from country-and region-specific problems. Europe is dealing with Brexit woes, Italian pushback against EU fiscal rules, and more generally, severe disagreements over refugee policies. Emerging market countries are facing varying degrees of uncertainty over threats of trade wars, and those that have dollar-denominated debt face huge increases in the cost of repaying that debt as their currencies depreciate against the dollar. The woes of these “rest of the world” markets have made U.S. markets all the more (relatively) attractive to global investors.
Our mission is to maximize our clients’ wealth over a period of many years.
Our mission is to maximize our clients’ wealth over a period of many years. We believe the best way to do that is to acknowledge the inevitability of periodic market corrections and hold a collection of good businesses that can withstand external negatives and continue to grow their business values. To that end, we own several categories of stocks—differing both in business characteristics and degree of “cheapness”—that we think will serve us well over time.
As a reminder, we believe that a business is worth the value today of all the cash that the business will generate for its owners in the future. We use a discounted cash flow calculation that takes conservative estimates of future cash flows and “discounts” them by 9% per year to reflect the time value of money. We have a high degree of humility as to the accuracy of these estimates, but if a company’s value is equal to its current price, we say that its price-to-value (P/V) is 100%. If all our assumptions turn out to be right (including the discounting of future cash flows), if we pay 100% of value, and the stock continues to trade at 100% of value, then we would theoretically earn 9% per year on an investment.
There is no rule that says a stock must eventually trade at 100% of value, but we believe that underlying business value exerts a sort of gravitational pull on stock prices. So, all things being equal, we prefer to buy stocks at a significant discount to 100%. In today’s securities markets, however, bargains are few and far between.
We own some great businesses whose stocks have appreciated significantly from our initial purchases and are now well recognized by investors. A few sell at or even a little above our estimates of their current business values. Given today’s opportunity set, we are willing to hold stocks like Mastercard, Visa, Guidewire Software and Thermo Fisher Scientific that have crept up to, and through, 100% P/V on our base case estimates. This may sound like a somewhat heretical statement coming from confirmed value investors, but hear us out. These are companies with significant competitive advantages that we would like to own for a long time. Our conservative appraisals of business value
 
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may prove to be just that, and each has a high case with plenty of potential upside. While their stock prices may be a little ahead of themselves for our tastes, these companies are growing very nicely, and even at a modest premium to our base case value estimates, we believe we can earn acceptable positive returns with little risk of permanent loss over the next few years.
There are also some very good/great businesses for which we have been willing to “pay up” a little, to establish at least starter positions, e.g., CarMax. Stocks like these as well as some long-time holdings like LabCorp (diagnostic testing), Google, Berkshire Hathaway, Oracle (software), Redwood Trust (mortgage investments), Praxair (industrial gases), and Texas Instruments (analog semiconductors) currently sell at 80-95% of our estimated P/V. These do not offer the large margin of safety of cheaper stocks, but we are comfortable holding them for long-term appreciation.
Finally, there are some good companies whose stocks actually seem very cheap. Prime examples would start with Liberty Global and the two Liberty plays on Charter Communications (GCI Liberty and Liberty Broadband). We believe they are significantly undervalued, and we would buy more if we did not already hold full positions. Housing and construction-related stocks like Mohawk (flooring), Fortune Brands (home and security products), and Vulcan, Summit and Martin Marietta Materials (aggregates and cement) suffer from uncertainty over rising interest rates, home affordability and barriers to infrastructure spending. Other cyclical companies like Colfax (industrial products) and several of our on-deck stocks are subject to fears of recession and/or trade wars. Stocks that look cheap are sometimes cheap for a reason; that is, they have some obvious flaw that clouds the investment thesis. It is often tricky to distinguish between a permanent impairment of value and a good company with a temporary, fixable impediment. We are mindful of the difficulties of investing in such deep value companies, but with careful research, they can prove to be very profitable investments.
Anything can happen when stocks start to sell off. Whether in response to some startling event or merely a last straw that tips the market into an overdue correction, selling can beget more selling. Prices can overshoot on the downside as well as the upside. However, we do not believe that there is a “tragic flaw” in today’s economy that would be analogous to the subprime mortgage meltdown or the late ‘90s tech bubble. Our thought is that as prices come back into line with business values, we may experience periods of subpar stock market returns but not a financial crisis. Very few of the strong, resilient companies we want to own are available at bargain prices, but we need not stop investing altogether. Corrections will happen—they are normal (though strangely absent over the past several years). In fact, we look forward to the day when true bargains are available again and we are able to take advantage of the opportunities. In the meantime, we thank you again for entrusting your investment capital to us.
Sincerely,
Wally Weitz  
Brad Hinton 
 
As of September 30, 2018, each of the following portfolio companies constituted a portion of the net assets of Value Fund, Partners Value Fund, Partners III Opportunity Fund, Hickory Fund, and Balanced Fund as follows: Alphabet, Inc. (Parent of Google)-Class C: 5.5%, 4.7%, 4.9%, 0%, and 2.1%. Berkshire Hathaway Inc.-Class B: 7.9%, 5.9%, 13.1%, 0%, and 2.4%. CarMax, Inc.: 2.3%, 2.1%, 2.3%, 0%, and 0%. Charter Communications, Inc.-Class A: 1.3%, 0%, 0%, 0%, and 0%. Colfax Corp.: 0%, 3.3%, 3.9%, 4.9%, and 0%. Fortune Brands Home & Security, Inc.: 0%, 0%, 0%, 1.1%, and 0%. GCI Liberty, Inc.-Class A: 0%, 0%, 1.6%, 4.0%, and 0%. Guidewire Software, Inc.: 0%, 0%, 0%, 2.1%, and 1.6%. Laboratory Corp. of America Holdings: 4.6%, 4.7%, 3.4%, 4.7%, and 2.1%. Liberty Broadband Corp.-Series A & C: 6.7%, 6.5%, 10.1%, 8.6%, and 2.2%. Liberty Global plc-Class C: 3.3%, 5.9%, 7.1%, 3.0%, and 0%. Martin Marietta Materials, Inc.: 0%, 0%, 0%, 0%, and 1.1%. Mastercard Inc.-Class A: 3.8%, 4.4%, 5.6%, 0%, and 2.0%. Mohawk Industries, Inc.: 2.0%, 0%, 0%, 0%, and 1.0%. Oracle Corp.: 4.5%, 3.5%, 0%, 0%, and 2.0%. Praxair, Inc.: 3.0%, 0%, 0%, 0%, and 2.0%. Redwood Trust, Inc.: 0%, 3.3%, 2.7%, 4.4%, and 1.5%. Summit Materials, Inc.-Class A: 0%, 1.9%, 1.4%, 2.7%, and 0%. Texas Instruments, Inc.: 0%, 3.1%, 2.8%, 0%, and 1.0%. Thermo Fisher Scientific Inc.: 3.1%, 0%, 0%, 0%, and 2.1%. Visa Inc.-Class A: 3.9%, 4.6%, 4.6%, 0%, and 2.1%. Vulcan Materials Co.: 1.6%, 0%, 0%, 0%, and 1.3%. Portfolio composition is subject to change at any time. Current and future portfolio holdings are subject to risk.
Included is a reference to the term “margin of safety”. This term refers to purchasing securities at a price that is less than our estimate of intrinsic value. A potential “margin of safety” may limit downside risk and optimize the potential for growth.
 
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DISCLOSURES
These performance numbers reflect the deduction of annual operating expenses which as stated in the most recent prospectus, and expressed as a percentage of each Fund’s or Class’s net assets, are: Value – Investor Class, 1.22%; Value – Institutional Class, 1.09% (gross); Partners Value – Investor Class, 1.25%; Partners Value –Institutional Class, 1.07% (gross); Partners III Opportunity – Investor Class, 2.14%; Partners III Opportunity – Institutional Class – 1.63%; Hickory, 1.24%; Balanced, 1.00% (gross); Core Plus Income – Investor Class, 1.65% (gross); Core Plus Income – Institutional Class, 1.09% (gross); Short Duration Income – Investor Class, 0.91% (gross); Short Duration Income – Institutional Class, 0.62% (gross); Ultra Short Government, 0.60% (gross); and Nebraska Tax-Free Income, 0.85%. See the Financial Highlights on pages 50 and 52 for more current expense ratios. The returns assume reinvestment of dividends and redemption at the end of each period. Total returns shown include fee waivers and expense reimbursements, if any; total returns would have been lower had there been no waivers and/or reimbursements. Performance data represents past performance, which does not guarantee future results. The investment return and the principal value of an investment in any of the Funds will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance may be higher or lower than the performance data quoted. Performance data current to the most recent month end may be obtained at www.weitzinvestments.com/funds_and_performance/fund_performance.fs. Index performance is hypothetical and is shown for illustrative purposes only. See page 70 for a description of all indices.
(a) On the last business day of 1993, 2005 and 2006, the Partners Value, Partners III Opportunity and Nebraska Tax-Free Income Funds (the “Funds”) succeeded to substantially all of the assets of Weitz Partners II Limited Partnership, Weitz Partners III Limited Partnership and Weitz Income Partners Limited Partnership (the“Partnerships”), respectively. The investment objectives, policies and restrictions of the Funds are materially equivalent to those of their respective Partnership and the Partnerships were managed at all times with full investment authority by the investment adviser. The performance information includes performance for the Partnerships. The Partnerships were not registered under the Investment Company Act of 1940 and, therefore, were not subject to certain investment or other restrictions or requirements imposed by the 1940 Act or the Internal Revenue Code. If the Partnerships had been registered under the 1940 Act, the Partnerships’ performance might have been adversely affected.
(b) Institutional Class shares of the Value and Partners Value Funds became available for sale on July 31, 2014. For performance prior to that date, these tables include the actual performance of each Fund’s Investor Class (and use the actual expenses of each Fund’s Investor Class) without adjustment. For any such period of time, the performance of each Fund’s Institutional Class would have been similar to the performance of each Fund’s Investor Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses. The investment adviser has agreed in writing to limit the total annual fund operating expenses of the Investor and Institutional Class shares (excluding taxes, interest, brokerage costs, acquired fund fees and expenses and extraordinary expenses) to 1.30% and 0.99%, respectively, of each Class’s average daily net assets through July 31, 2019.
(c) Investor Class shares of the Partners III Opportunity and Short Duration Income Funds became available for sale on August 1, 2011. For performance prior to that date, these tables include the actual performance of each Fund’s Institutional Class (and use the actual expenses of each Fund’s Institutional Class) without adjustment. For any such period of time, the performance of each Fund’s Investor Class would have been similar to the performance of each Fund’s Institutional Class, because the shares of both classes are invested in the same portfolio of securities, but the classes bear different expenses. The investment adviser has agreed in writing to limit the total annual fund operating expenses of the Short Duration Income Fund’s – Investor and Institutional Class shares (excluding taxes, interest, brokerage costs, acquired fund fees and expenses and extraordinary expenses) to 0.68% and 0.48%, respectively, of each Class’s average daily net assets through July 31, 2019.
(d) The investment adviser has agreed, in writing, to limit the total annual fund operating expenses (excluding taxes, interest, brokerage costs, acquired fund fees and expenses and extraordinary expenses) to 0.85% of the Fund’s average daily net assets through July 31, 2019.
(e) The investment adviser has agreed in writing to limit the total annual fund operating expenses of the Core Plus Income Fund’s Investor and Institutional Class shares (excluding taxes, interest, brokerage costs, acquired fund fees and expenses and extraordinary expenses) to 0.60% and 0.40%, respectively, of each Class’s average daily net assets through July 31, 2019.
(f) The Fund’s past performance is not necessarily an indication of how the Fund will perform in the future. Effective December 16, 2016, the Fund revised its principal investment strategies and policies to permit the Fund to invest in a diversified portfolio of short-term debt securities and to have a fluctuating net asset value. Prior to December 16, 2016, the Fund operated as a “government money market fund” as defined under Rule 2a-7 of the Investment Company Act of 1940 and maintained a stable net asset value of $1.00 per share. The Fund’s past performance reflects the Fund’s prior principal investment strategies and policies. The investment adviser has agreed in writing to limit the total annual fund operating expenses of the Ultra Short Government Fund (excluding taxes, interest, brokerage costs, acquired fund fees and expenses and extraordinary expenses) to 0.20% of the Fund’s average daily net assets through July 31, 2019.
(g) Since inception performance for the Russell 1000 Value and CPI +1% is from May 31, 1986 and December 31, 1988, respectively. The inception date of the Bloomberg Barclays 1-3 Year U.S. Aggregate and 5-Year Municipal Bond was December 31, 1992 and January/29, 1988, respectively.
 
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PERFORMANCE SUMMARY
                                       
  Annualized              
   
Fund Name
Inception
Date 
Since
Inception
   30-year    
20-year
 
Since Investment
Style Inception
(6/30/08)
   
10-year
   
5-year
   
1-year
   
YTD
   
Quarter
 
Value(b)
5/09/86 
                                   
Investor
 
10.25
%
10.48
%
7.38
%
8.90
%
9.46
%
8.06
%
12.13
%
8.87
%
5.52
%
Institutional
 
10.28
 
10.51
 
7.43
 
8.99
 
9.55
 
8.25
 
12.38
 
9.06
 
5.59
 
Russell 1000
 
10.51
 
10.71
 
7.70
 
10.70
 
12.09
 
13.67
 
17.76
 
10.49
 
7.42
 
Russell 1000 Value(g)
10.26
 
10.31
 
7.64
 
8.86
 
9.79
 
10.72
 
9.45
 
3.92
 
5.70
 
   
Partners Value(a)(b)
6/01/83 
                                   
Investor
 
11.72
 
10.79
 
7.67
 
 
9.69
 
5.64
 
7.22
 
5.32
 
5.41
 
Institutional
 
11.75
 
10.83
 
7.72
 
 
9.80
 
5.84
 
7.49
 
5.54
 
5.49
 
   
Partners III
 
                                   
Opportunity(a)(c)
6/01/83 
                                   
Investor
 
12.13
 
11.59
 
8.95
 
 
10.37
 
3.96
 
4.34
 
7.03
 
4.45
 
Institutional
 
12.21
 
11.69
 
9.10
 
 
10.67
 
4.39
 
4.91
 
7.48
 
4.60
 
Russell 3000
 
10.96
 
10.63
 
7.82
 
 
12.01
 
13.46
 
17.58
 
10.57
 
7.12
 
Russell 3000 Value
11.14
 
10.33
 
7.80
 
 
9.76
 
10.65
 
9.46
 
4.17
 
5.39
 
   
Hickory
4/01/93 
9.52
 
 
6.27
 
8.94
 
9.43
 
4.32
 
1.27
 
2.98
 
2.71
 
Russell 2500
 
10.76
 
 
10.52
 
10.95
 
12.02
 
11.37
 
16.19
 
10.41
 
4.70
 
Russell 2500 Value
10.93
 
 
10.24
 
10.12
 
10.53
 
9.99
 
10.24
 
5.75
 
2.67
 
   
S&P 500
 
 
10.60
 
7.42
 
10.70
 
11.97
 
13.95
 
17.91
 
10.56
 
7.71
 
   
Balanced(d)
10/01/03 
5.57
 
 
 
 
7.35
 
5.15
 
5.99
 
4.09
 
2.63
 
Moderately Conservative
5.98
 
 
 
 
6.04
 
4.96
 
3.91
 
1.28
 
1.82
 
Blended Index
7.27
 
 
 
 
8.67
 
8.94
 
10.10
 
6.00
 
4.67
 
   
Core Plus Income(e)
7/31/14 
                                   
Investor
 
2.59
 
 
 
 
 
 
0.07
 
(0.09
)
0.12
 
Institutional
 
2.79
 
 
 
 
 
 
0.27
 
0.05
 
0.07
 
U.S. Aggregate Bond
1.75
 
 
 
 
 
 
(1.22
)
(1.60
)
0.02
 
   
Short Duration
 
                                   
Income(c)
12/23/88 
                                   
Investor
 
4.99
 
 
3.70
 
 
2.97
 
1.25
 
0.24
 
0.39
 
0.31
 
Institutional
 
5.04
 
 
3.78
 
 
3.13
 
1.47
 
0.43
 
0.54
 
0.36
 
1-3 Year U.S. Aggregate(g)
 
 
3.17
 
 
1.76
 
0.86
 
0.22
 
0.42
 
0.34
 
CPI + 1%(g)
 
3.54
 
 
3.22
 
 
2.46
 
2.53
 
3.30
 
3.17
 
0.43
 
   
Ultra Short
 
                                   
Government(f)
8/01/91 
2.36
 
 
1.67
 
 
0.29
 
0.43
 
1.45
 
1.21
 
0.48
 
6-Month Treasury
2.94
 
 
2.19
 
 
0.58
 
0.66
 
1.58
 
1.30
 
0.50
 
   
Nebraska Tax-Free
 
                                   
Income(a)
10/01/85 
4.47
 
4.12
 
2.98
 
 
2.31
 
0.86
 
(0.88
)
(0.70
)
(0.25
)
5-Year Municipal Bond(g)
 
4.88
 
3.81
 
 
3.37
 
1.85
 
(0.60
)
0.10
 
(0.20
)
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ANALYST CORNER
Introduction to DXC Technology
By Barton Hooper, CFA
DXC Technology (“DXC”) is an information technology (“IT”) outsourcing firm created on April 1, 2017, from the merger of Computer Sciences Corporation (“CSC”) and Hewlett Packard Enterprise Services (“HPS”).
Both firms had long and infamous legacies as pioneers of outsourced IT services for corporations and governments. Outsourced IT services run the gamut from operating datacenters, to writing and maintaining applications, down to providing help desk personnel, who get workplace laptops to recognize the company Wi-Fi network. Historically, these engagements involved large, bespoke and intricate contracts for various activities, and often involved the re-badging of clients’ employees to those of the IT outsourcer.
To diversify their product lines, many IT outsourcers expanded into business process outsourcing (“BPO”) and consulting services, but for firms such as CSC and HPS, IT outsourcing remained the core. The offering mix contrasts with long-term Weitz portfolio holding Accenture, for example, which has a significant consulting business that complements its IT and BPO services, allowing for higher sales growth and margins.
Customers chose to outsource their IT and back office functions using BPO because operating environments were becoming increasingly complex and expensive. The hope was that an outsourcer could create scale across multiple customers while delivering better performance at a lower cost. While lower costs were realized by customers in the form of low pricing, IT and business complexity only grew as new technology was layered on top of legacy systems. Any savings created through purchasing or learning curves were typically given back to the customer at contract renewals. These developments meant that IT outsourcing and BPO firms became businesses with a lack of standardization, high labor intensity and low profit margins. IT outsourcing and BPO became, in the words of DXC CEO Mike Lawrie, “Your mess for less.”
During the 1990s and 2000s, CSC and HPS predecessor firms HPE and EDS faced additional pressure from India-based firms, who were able to offer many services, such as network and application management, to customers for a much lower price due to the labor arbitrage available from using programmers from their home country. The India-based firms proved equally capable of performing BPO services at a much lower cost.
With numerous complex contracts, poor service levels and pressure from Indian firms, CSC found itself near bankruptcy by 2012. Mike Lawrie was hired at this time as CEO of CSC. Immediately, Mr. Lawrie began to rationalize CSC’s business by renegotiating or exiting unprofitable contracts, cutting out multiple layers of management created to oversee the overly complex contracts, and investing in lower-cost IT outsourcing facilities in India and the U.S. while also modernizing CSC’s underlying technology infrastructure. During Mr. Lawrie’s term as CEO of stand-alone CSC, until the merger with HPS, margins increased from zero to approximately 8 percent, while its 2,000 customized offerings were reduced to 230 standardized services. Further value was created by spinning off CSC’s federal government business.
Following the merger, DXC has focused on rationalizing its cost structure, aligning go-to-market and delivery operations, and further simplifying service offerings. In the fall of 2017, DXC announced the spin-merger of the legacy HPS federal government services business (representing 10 percent of revenue) into a new company called Perspecta, which began trading on June 1, 2018. DXC is now focused on serving global businesses and state and local governments.
Today the company continues to focus on reducing costs. For example, only 54 percent of its outsourcing workforce is based in low-cost locations, but the goal is to increase it to 70 percent in the next few years. Additionally, the company is ahead of its goal to achieve the $2.1 billion of cost savings (adjusted for the Perspecta spin) it projected at the time of the merger with HPS.
Looking ahead, Mr. Lawrie and his team are in the process of repositioning the overall business to take advantage of new technologies and business opportunities. The emergence of new technologies and processes, such as cloud, artificial intelligence and robotic process automation, has allowed DXC (and others) to realize true scaling impacts, as previously labor-intensive activities are replaced by software and algorithms, many of which include proprietary DXC intellectual property. The company has been applying these helpful technologies to standardize processes across the customer base, reduce labor and management oversight while providing more consistent levels of service, all at a lower cost.
DXC’s customers are using the savings from basic services to purchase higher-margin digital transformation capabilities such as cloud, mobile and analytics. The company has also expanded
 
8  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM

and fortified its industry-specific practices in healthcare, travel and financial services to create a differentiated BPO business. These specialized practices help customers using DXC developed software, processes and services, which drive higher revenue and margins while increasing customer “stickiness.” DXC expects the combination of its digital transformation and industry-specific services to eventually generate half of total revenues as these practices grow and it actively shrinks traditional IT outsourcing services.


While on the surface the legacy businesses of DXC looked severely challenged, Mr. Lawrie’s excellent track record at CSC, and the similarities between CSC’s challenges then and DXC’s now, gives us confidence that DXC’s future should be much improved. To date, DXC appears on track with our investment thesis that good management, significant cost savings and a change in business mix will eventually result in the stock price approximating our business value of around $115.


As of September 30, 2018, each of the following portfolio companies constituted a portion of the net assets of Value Fund, Partners Value Fund, Partners III Opportunity Fund, Hickory Fund, and Balanced Fund as follows: Accenture plc-Class A: 1.9%, 0%, 0%, 0%, and 1.1%. DXC Technology Co.: 1.5%, 2.9%, 2.8%, 0%, and 0%. Perspecta Inc.: 0%, 0%, 1.2%, 0.9%, and 0%. Portfolio composition is subject to change at any time. Current and future portfolio holdings are subject to risk.
 
Barton Hooper, CFA®, Research Analyst, joined Weitz Investments in 2007. Prior to joining the Firm, he was a research analyst at Oak Value Capital Management and Trilogy Capital Management. Prior to his investment management experience, Barton worked at George K. Baum & Company and Deloitte & Touche LLC as a certified public accountant. Barton has a bachelor’s in accounting from the University of Missouri and an MBA from Washington University in Saint Louis.
 
9  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

VALUE FUND
Investment Style: Large-Cap Value
Co-Portfolio Managers: Brad Hinton, CFA and Dave Perkins, CFA
The Value Fund’s Institutional Class returned +5.59% during the third quarter compared to +7.71% for the S&P 500 and +7.42% for the Russell 1000. For the first nine months of calendar 2018, the Fund’s Institutional Class returned +9.06% compared to +10.56% for the S&P 500 and +10.49% for the Russell 1000. Since adopting its large-cap company mandate on June 30, 2008, the Fund’s Institutional Class has generated average annual returns of +8.99% compared to +10.70% for the S&P 500 and +10.70% for the Russell 1000.
For domestic equity investors–both public and private–it remains the best of times. Consumers are confident. Economic growth has accelerated. Borrowing costs are reasonable. Animal spirits are high. Fundamentally speaking, all is relatively calm. Against this backdrop, we continue to keep our collective noses to the ground in search of mispriced risk. One question we’ve been asking ourselves with greater frequency of late: Which stock carries more risk to the long-term investor–a durable “compounder” trading at 30 times forward earnings nine years into a market expansion or a more cyclical/less-defensible business trading at 10-12 times expected earnings nine years into an economic expansion? Courtesy of Mr. Market, ample versions of both are on offer today. Should either be bought/owned? Our preference, as always, is “quality at a reasonable (or better) price.” We seek to avoid compromise on either variable.
Three of the Fund’s largest holdings–Berkshire Hathaway (+15%), Allergan (+15%) and Liberty Broadband/Charter Communications (each +11%)–were the most meaningful contributors to third quarter performance. Investors cheered Berkshire Hathaway’s strong second quarter results as well as the decision to grant CEO Warren Buffett and Vice Chairman Charlie Munger greater autonomy in repurchasing the company’s stock. We agree the prior constraint of 1.2 times book value had become less germane as Berkshire’s wholly owned, non-financial operating businesses continue to contribute a larger share of earnings. Allergan’s stock participated in the strength across most of healthcare during the third quarter. The company’s first-ever Medical Aesthetics Day on September 14 served as a welcome reminder of the attractiveness of the company’s core growth engine. Cable sentiment also began to rebound thanks to improved operating results across the sector. As the calendar approaches 2019, we believe the tactical investments and heavy operational lifting Charter has tackled the past couple of years will begin to bear fruit in the form of substantial free cash flow per share growth.
Through the first nine months of calendar 2018, Mastercard (+48%) and Amazon (+71%) join Allergan (+18%) as the largest contributors to Fund performance. We trimmed positions in all three holdings during the third quarter, principally on valuation. In November last year, we increased our position in Allergan to 6.0% of net assets at what we believed was an increasingly attractive discount to our estimate of business value. As the stock appreciated and Allergan’s weighting in the Fund increased, we elected to sell some shares to keep the position size in line. At just shy of 12 times our estimate of 2019 cash earnings, however, we believe Allergan’s prospects remain underappreciated.
Facebook (-15%), Mohawk Industries (-18%) and LabCorp (-3%) detracted a combined 100 basis points (-1%) from third quarter performance. Facebook, and social media more broadly, remains under a microscope. Our read of the data continues to suggest that user perception is far less negative than that of traditional media and numerous elected officials. This is not to make light of the challenges facing the company. Maintaining the trust of its vast user base is both critical and complicated on a global scale. Facebook’s common advertising platform and portfolio of digital properties (Facebook, Instagram, WhatsApp, Messenger) remain uniquely valuable media assets. Never have advertisers of all sizes been able to attain such a specific reach. Nor have users seen curated recommendations with a near-frictionless ability to purchase. These capabilities should further improve over time, providing the opportunity for many years of potentially double-digit organic growth. We added to our Facebook position during the quarter.
Shares of Mohawk Industries, which we began purchasing last quarter, declined as input inflation continues to pressure profitability. The structural characteristics of the flooring markets Mohawk operates in are attractive, as is the company’s competitive position in each, but pricing often lags cost increases. Investors appear to envision a fragile demand environment over the next several years, presumably due to higher interest rates, peak-ish employment and softening results for the public homebuilders. While cautious, we are more constructive and believe Mohawk’s current stock price ($170) provides an attractive margin of safety for those with a multi-year investment horizon. We added modestly to our position at the end of July, with room to further increase the Fund’s exposure should the stock continue to weaken.
Discount retailer Dollar Tree (-24%) and European cable provider Liberty Global (-17%) join Mohawk (-18%) as the primary detractors from calendar year-to-date performance. The uneven pace of improvement at Dollar Tree’s Family Dollar unit over the past 12 months has kept a lid on business value growth and raised concerns that Dollar Tree’s rationale for the Family Dollar purchase three years ago was flawed. We continue to see several potential paths to improved performance at Family Dollar, with the Dollar Tree banner’s strength providing ballast in the interim. Liberty Global’s operating results remain mixed, with improvements in the U.K. offset by ongoing difficulties in Belgium and Switzerland. While we continue to believe the stock is undervalued, we have greater conviction in the ability of domestic cable peer Charter to grow over the next several years and have focused the Fund’s incremental cable purchases there as a result.
The Fund initiated new positions in discount broker turned bank Charles Schwab and aggregates producer Vulcan Materials. We closed the Fund’s small position (0.2% of net assets) in Perspecta, which was spun out of DXC Technologies in May. With a $4 billion market capitalization, it was not aligned with the Fund’s larger-company mandate. Schwab is a business we added to our on-deck list several years ago. Since then, the company has methodically gained market share from major banks and traditional brokers, with innovative, low-cost platforms tailored to both individuals and investment advisors. We find ourselves drawn to scale businesses that consistently share the benefits of size directly with their customers. We believe Schwab to be such an enterprise, and the company’s results suggest clients continue to “vote with their feet” by bringing new accounts and a greater share of their assets. Using relatively conservative forecasts, we estimate Schwab’s intrinsic value to be in the low $60s today.
We’ll close with a brief reintroduction to Vulcan Materials. The aggregates business (stone used for highways and bridges) has long been one of our favorites, boasting high barriers to entry, strong pricing power and minimal risk of obsolescence. Demand for Vulcan’s products spans the public works, industrial, commercial and residential end markets. Public infrastructure, which represents roughly half of Vulcan’s revenue, has seen sluggish spending over the past several years despite passage of a five-year federal highway bill in late 2015 and increased state and local transportation funding. In our view, visibility into public demand over the next several years is as healthy as it’s been in a decade. This should result in healthy unit growth, even if private construction levels cool off for a period of time. The combination of steadily rising volumes and mid-single-digit price increases should drive an attractive stream of double-digit profit growth over our investment horizon, and we estimate Vulcan’s price-to-value to be in the 70-75% range.
Included is a reference to the term “margin of safety”. This term refers to purchasing securities at a price that is less than our estimate of intrinsic value. A potential “margin of safety” may limit downside risk and optimize the potential for growth.
 
10  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
 
 
                                     
Returns
Annualized
             
 
Since
Inception
(5/9/1986)
 
20-year
 
Since Invest-
ment Style
Inception
(6/30/08)
 
10-year
 
5-year
 
3-year
 
1-year
 
YTD
 
Quarter
 
WVALX - Investor Class
10.25
%
7.38
%
8.90
%
9.46
%
8.06
%
9.30
%
12.13
%
8.87
%
5.52
%
WVAIX - Institutional Class
10.28
 
7.43
 
8.99
 
9.55
 
8.25
 
9.53
 
12.38
 
9.06
 
5.59
 
S&P 500
10.50
 
7.42
 
10.70
 
11.97
 
13.95
 
17.31
 
17.91
 
10.56
 
7.71
 
Russell 1000
10.51
 
7.70
 
10.70
 
12.09
 
13.67
 
17.07
 
17.76
 
10.49
 
7.42
 
Russell 1000 Value
10.26
*
7.64
 
8.86
 
9.79
 
10.72
 
13.55
 
9.45
 
3.92
 
5.70
 
 
Growth of $10,000
This chart depicts the change in the value of a $10,000 investment in the Value Fund – Investor Class for the period since inception (5/9/86) through September 30, 2018, as compared with the growth of the Standard & Poor’s 500, Russell 1000 and Russell 1000 Value Indices during the same period. Index performance is hypothetical and is shown for illustrative purposes only.
 

* Since 5/31/1986
       
Top 10 Stock Holdings 
     
 
 
% of Net Assets
 
Berkshire Hathaway Inc. - Class B  
   
7.9
 
Liberty Broadband Corp. - Series C  
   
6.7
 
Alphabet, Inc. - Class C  
   
5.5
 
Allergan plc  
   
4.9
 
Laboratory Corp. of America Holdings  
   
4.6
 
Oracle Corp.  
   
4.5
 
Visa Inc. - Class A  
   
3.9
 
Mastercard Inc. - Class A  
   
3.8
 
Liberty Global plc - Class C  
   
3.3
 
Dollar Tree, Inc.  
   
3.2
 
 
   
48.3
 
 
       
Industry Breakdown 
     
 
 
% of Net Assets
 
Communication Services  
   
26.3
 
Information Technology  
   
15.6
 
Financials  
   
14.9
 
Health Care  
   
13.9
 
Consumer Discretionary  
   
10.6
 
Materials  
   
4.6
 
Consumer Staples  
   
2.0
 
Industrials  
   
1.4
 
Energy  
   
1.2
 
Cash Equivalents/Other  
   
9.5
 
 
   
100.0
 
 
                   
Top Performers
   
Average
       
 
 
Return
   
Weight
   
Contribution
 
Berkshire Hathaway Inc. - Class B  
   
14.7
%
   
8.7
%
   
1.25
%
Allergan plc  
   
14.7
     
5.8
     
0.87
 
Liberty Broadband Corp. - Series C  
   
11.3
     
6.4
     
0.71
 
Oracle Corp.  
   
17.5
     
4.3
     
0.69
 
Mastercard Inc. - Class A  
   
13.4
     
4.3
     
0.55
 
 
                   
Bottom Performers
   
Average
       
 
 
Return
   
Weight
   
Contribution
 
Facebook, Inc. - Class A  
   
(15.4
)%
   
3.1
%
   
(0.50
)%
Mohawk Industries, Inc.  
   
(18.2
)
   
2.0
     
(0.35
)
Laboratory Corp. of America Holdings  
   
(3.3
)
   
4.7
     
(0.15
)
Twenty-First Century Fox, Inc. - Class A  
   
(6.4
)
   
1.8
     
(0.13
)
Dollar Tree, Inc.  
   
(4.1
)
   
3.5
     
(0.13
)
 
Contributions to Fund performance are based on actual daily holdings. Securities may have been bought or sold during the quarter. Source: FactSet Portfolio Analytics
Return shown is the actual quarterly return of the security or combination of share classes.

Returns assume reinvestment of dividends and redemption at the end of each period, and reflect the deduction of annual operating expenses which as stated in its most recent prospectus are 1.22% and 1.09% (gross) of the Fund’s Investor and Institutional Class net assets, respectively. Total returns shown include fee waivers and expense reimbursements, if any; total returns would have been lower had there been no waivers and/or reimbursements. Performance data represents past performance, which does not guarantee future results. The investment return and the principal value of an investment in this Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance may be higher or lower than the performance data quoted. Performance data current to the most recent month-end may be obtained at www.weitzinvestments.com/funds_and_ performance/fund_ performance.fs.
See page 6 for additional performance disclosures. See page 70 for a description of all indices.
Performance information does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.
 
11  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
PARTNERS VALUE FUND
Investment Style: Multi-Cap Value
Co-Portfolio Managers: Wally Weitz, CFA and Brad Hinton, CFA
The Partners Value Fund’s Institutional Class returned +5.49% during the third quarter compared to +7.71% for the S&P 500 and +7.12% for the Russell 3000. Year to date, the Fund’s Institutional Class returned +5.54% compared to +10.56% for the S&P 500 and +10.57% for the Russell 3000. Third quarter returns were much improved but still lagged the broader market indices. While this momentum-driven market bully keeps kicking sand in our faces, rest assured that we are not standing still and just taking it. Read on to learn more about how we are building up new muscles to compete while sticking steadfastly to the core principles that have driven the Firm’s 35-year track record.
The U.S. stock market has been a shining star in 2018, with growth and momentum continuing to clobber value. Not surprisingly, payment networks Visa and Mastercard have been the Fund’s strongest year-to-date contributors by far. These dominant and well-loved businesses continue to stamp out impressive revenue and profit growth. While we trimmed Visa after its outsized gains, both stocks remain among our ten largest holdings. Among other contributors, Discovery Communications and Allergan plc are best described as redemption stories. Both companies were very out of favor last year, with stocks trading at bargain-basement valuations coming into 2018. Good things often happen to cheap stocks, even in a “go-go” market. As the companies executed their playbooks, the stocks rebounded nicely. Discovery has nearly doubled off its lows, and we have resized the position accordingly. Allergan remains inexpensive at just 12 times our estimated 2019 cash earnings, and we think the stock has more room to run.
Our cable and consumer holdings held back year-to-date results. Top detractor Liberty Global posted mixed operating results, with improvements in the U.K. offset by ongoing difficulties in Belgium and Switzerland. Liberty Broadband’s stock treaded water due to investor frustration about the pace of improvement at core asset Charter Communication. We think this is primarily a time-horizon mismatch, and the stage is set for substantial free cash flow per share growth in 2019 and beyond. Other detractors included Tupperware Brands and Qurate Retail. Tupperware’s earnings estimates declined materially due to emerging-market weakness and unfavorable foreign exchange swings. While the stock has plenty of upside potential, we sold our modest position after lacking the conviction to buy more. Qurate’s operating results at recently acquired HSN disappointed investors, and this unit’s turnaround will take some time. Meanwhile, the core QVC business keeps churning out free cash flow, and Zulily continues to grow revenues and active customers with fun, personalized shopping experiences. We think the market valuation for this set of durable, resilient businesses is just too low.
We have embraced a back-to-the-basics approach as we enter the tenth year of this bull market. For years, we’ve described our version of concentrated investing as owning 25-35 securities, with position sizes generally ranging from 2% to 6% of assets. We want every idea to matter, and our best ones to have an outsized impact without “betting the farm” on any single stock. As the bull market progressed, we drifted a bit from our sweet spot. We became too comfortable with taking “just a taste” of a new idea. For a variety of reasons, we were often tentative with our initial purchases. While price discipline is essential, we’ve found that if we are ready to buy, then we simply need to get going.
Our course correction has been to increase the size of the smaller positions in our portfolio, offering two potential benefits. First, it increases the impact of the team’s new ideas. We are surrounded by talented, experienced stock pickers. When analysts recommend a well-researched business at a discounted price, our hit rate is reasonably high. And when the portfolio managers agree, we need to act assertively. Recent examples where we left return on the table include Danaher and CarMax. Second, it raises the bar on initial conviction for both portfolio managers and analysts. There is less chance of “cutting the flowers and watering the weeds” if the weeds never make it into the portfolio. If we are not willing to buy a 2%-3% position out of the gates because the risk profile is elevated, that should tell us something.
You can clearly see the influence of this reframing on the portfolio. New holdings Charles Schwab (discount broker turned bank), Marvell Technologies (specialized semiconductors) and Summit Materials (cement and concrete) are all approximately 2.0% positions. We increased our Facebook (3.1%), DXC Technology (2.9%), CarMax (2.1%) and Comcast (2.0%) weightings, while closing sub-scale positions in Danaher, Tupperware, GCI Liberty and DXC spin-out Perspecta. At the other end of the spectrum, we worked down our two super-sized positions as their stocks rallied late in the quarter (Berkshire Hathaway from 9.2% to 5.9% and Liberty Broadband from 8.5% to 6.5%).
At quarter end, we owned 26 businesses with an average position size of 3.4% (median size 3.1%). The top 10 holdings represented 47.8% of net assets, while the bottom 10 holdings still accounted for 21.2% of net assets. Our highest-conviction ideas will drive the bulk of forward returns, yet every idea will matter as intended. Residual cash is 12.2% of net assets. We’d like to see that percentage even lower over time, but the opportunity set will dictate our timing.
The estimated price-to-value of the portfolio is in the low 80s, much cheaper than our view of the overall stock market. You’ve heard it before, but we’ll say it again. We like our chances from here, especially on a relative basis. From all of us at Weitz, thank you for entrusting your capital to us. We appreciate your patience and continued investment in the Fund.
 
12  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
 
                                 
Returns
Annualized
             
 
Since
Inception
(6/1/1983)
 
20-year
 
10-year
 
5-year
 
3-year
 
1-year
 
YTD
 
Quarter
 
WPVLX - Investor Class
11.72
%
7.67
%
9.69
%
5.64
%
7.44
%
7.22
%
5.32
%
5.41
%
WPVIX - Institutional Class
11.75
 
7.72
 
9.80
 
5.84
 
7.70
 
7.49
 
5.54
 
5.49
 
S&P 500
11.17
 
7.42
 
11.97
 
13.95
 
17.31
 
17.91
 
10.56
 
7.71
 
Russell 3000
10.96
 
7.82
 
12.01
 
13.46
 
17.07
 
17.58
 
10.57
 
7.12
 
Russell 3000 Value
11.14
 
7.80
 
9.76
 
10.65
 
13.75
 
9.46
 
4.17
 
5.39
 
 
Growth of $10,000
This chart depicts the change in the value of a $10,000 investment in the Partners Value Fund - Investor Class for the period since inception (6/1/83) through September 30, 2018, as compared with the growth of the Standard & Poor’s 500, Russell 3000 and Russell 3000 Value Indices during the same period. Index performance is hypothetical and is shown for illustrative purposes only.

       
Top 10 Stock Holdings 
     
 
 
% of Net Assets
 
Liberty Broadband Corp. - Series A & C  
   
6.5
 
Liberty Global plc - Class C  
   
5.9
 
Berkshire Hathaway Inc. - Class B  
   
5.9
 
Alphabet, Inc. - Class C  
   
4.7
 
Laboratory Corp. of America Holdings  
   
4.7
 
Visa Inc. - Class A  
   
4.6
 
Mastercard Inc. - Class A  
   
4.4
 
Liberty SiriusXM Group - Series A & C  
   
3.8
 
Allergan plc  
   
3.8
 
Oracle Corp.  
   
3.5
 
 
   
47.8
 
 
       
Industry Breakdown 
     
 
 
% of Net Assets 
 
Communication Services  
   
30.3
 
Information Technology  
   
20.6
 
Financials  
   
16.4
 
Health Care  
   
8.5
 
Consumer Discretionary  
   
4.8
 
Materials  
   
3.9
 
Industrials  
   
3.3
 
Cash Equivalents/Other  
   
12.2
 
 
   
100.0
 
 
                   
Top Performers
   
Average
       
 
 
Return
   
Weight
   
Contribution
 
Berkshire Hathaway Inc. - Class B  
   
14.7
%
   
8.3
%
   
1.28
%
Liberty Broadband Corp. - Series A & C  
   
11.4
     
7.9
     
0.85
 
Visa Inc. - Class A  
   
13.5
     
5.3
     
0.70
 
Allergan plc  
   
14.7
     
4.4
     
0.63
 
Oracle Corp.  
   
17.5
     
3.3
     
0.54
 
 
                   
Bottom Performers
   
Average
       
 
 
Return
   
Weight
   
Contribution
 
Facebook, Inc. - Class A  
   
(15.4
)%
   
2.2
%
   
(0.31
)%
Summit Materials, Inc. - Class A  
   
(30.7
)
   
1.0
     
(0.29
)
Tupperware Brands Corp.  
   
(17.2
)
   
1.0
     
(0.29
)
Laboratory Corp. of America Holdings  
   
(3.3
)
   
4.8
     
(0.16
)
Liberty SiriusXM Group - Series A & C  
   
(3.9
)
   
4.1
     
(0.15
)
 
Contributions to Fund performance are based on actual daily holdings. Securities may have been bought or sold during the quarter. Source: FactSet Portfolio Analytics
Return shown is the actual quarterly return of the security or combination of share classes.

Returns assume reinvestment of dividends and redemption at the end of each period, and reflect the deduction of annual operating expenses which as stated in its most recent prospectus are 1.25% and 1.07% (gross) of the Fund’s Investor and Institutional Class net assets, respectively. Total returns shown include fee waivers and expense reimbursements, if any; total returns would have been lower had there been no waivers and/or reimbursements. Performance data represents past performance, which does not guarantee future results. The investment return and the principal value of an investment in this Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance may be higher or lower than the performance data quoted. Performance data current to the most recent month-end may be obtained at www.weitzinvestments.com/funds_and_ performance/fund_ performance.fs.
See page 6 for additional performance disclosures. See page 70 for a description of all indices.
Performance information does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.
 
13  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
PARTNERS III OPPORTUNITY FUND
Investment Style: Multi-Cap Alternative
Portfolio Manager: Wally Weitz, CFA
The Partners III Opportunity Fund’s Institutional Class returned +4.60% in the third calendar quarter compared to +7.71% for the S&P 500 and +7.12% for the Russell 3000. For the calendar year to date, the Partners III Opportunity Fund’s Institutional Class returned +7.48% compared to +10.56% for the S&P 500 and +10.57% for the Russell 3000.
In mid-August, the ongoing U.S. equity rally added another superlative to its resume, claiming the title of the longest bull market since WWII (as measured by the S&P 500). As the saying goes, “bull markets don’t die of old age,” but we suspect they do become more fragile. That’s not to suggest a bear market is imminent. Many gauges of economic health in the U.S. are still in the green, and we lean toward believing there are more tailwinds than headwinds (domestically, anyway) at present. That does not necessitate, however, that stock prices only move higher. It was just six months ago we wrote in our commentary about the (temporary) return of volatility. We can’t predict when investor anxieties may be triggered, or their source. Instead, we focus on identifying businesses we’d like to own and the prices at which we’d like to buy them. We purchased initial positions in two such businesses during the third quarter: Summit Materials and Charles Schwab Corp.
Summit is a supplier of construction materials, including aggregates, cement, ready mix concrete and asphalt paving mix. Mother Nature has not cooperated this season, postponing otherwise strong (and funded) demand for infrastructure projects. These delays pressured Summit’s volumes and pushed out the translation of otherwise healthy demand into cash flow. We believe investors have overreacted, and we used the recent weakness to build an initial position. Charles Schwab, the eponymously named discount brokerage and bank, continues to win market share from major banks and traditional brokers, thanks to their innovative and low-cost platforms built for individuals and investment advisors alike. Client asset growth begets greater scale, and Schwab consistently passes those benefits back to consumers through lowered costs, creating a virtuous cycle of growth in both business value and customers.
Berkshire Hathaway (+15%) and Liberty Broadband (+11%), our two largest positions, were our top contributors this quarter. Berkshire reported strong second quarter results, and investors cheered the news that the company’s board had granted Buffett and Munger greater latitude in the company’s buyback program. Sentiment has also improved for U.S. cable stocks after solid second quarter results. Additionally, Liberty Broadband rose as investors began to look past a multi-year investment period at Charter, anticipating much-improved cash flow growth. Allergan (+15%) shares were also a top performer, as healthcare stocks were generally strong in the quarter. Allergan also hosted its first-ever Medical Aesthetics Investor Day, showcasing the company’s core growth engine.
Facebook (-15%) and Tupperware Brands (-17%) were the top detractors from our long equity holdings. Facebook continues to wrestle with critically important topics such as privacy, trust and authenticity. We acknowledge these are difficult issues, and progress will likely be slow and nuanced. Nevertheless, users have stuck with the platform, and the incredibly valuable advertising platform that Facebook has built remains intact. Tupperware Brands’ operating results have admittedly been lackluster, but with 90% of its revenues earned outside the United States, investors appear to believe Tupperware is permanently on the “wrong side” of both currency risks and ongoing trade disputes. There’s plenty of uncertainty surrounding when these headwinds will abate. But given our long-term view of Tupperware’s global business prospects and its stock priced around seven times next year’s earnings, we believe the risk-reward profile to be favorable. To reiterate a point from this quarter’s shareholder letter, we are mindful of the challenges such “deep value” opportunities pose (just as buying a wonderful business at too high a price creates challenges of a different sort), and we will size the position accordingly. Nevertheless, there are many ways to apply a value investing philosophy, and our portfolio approach affords us the flexibility to act on different kinds of opportunities.
Collectively, the Fund’s short positions against ETFs tracking the S&P 500 (+8%) and the Nasdaq 100 (+8%) indices were the largest detractor to performance. During the quarter, we modestly trimmed back both positions, leaving the Fund’s short exposure relatively unchanged at 30% of net assets. Activity within our long portfolio included a number of buys and sells. In addition to Summit and Schwab, we continued to build our initial position in Marvell Technology. We completed the sale of our XO Group shares (as described last quarter) and closed small positions in Oracle and Danaher. The net impact leaves the Fund’s effective net long position at 66% of net assets, unchanged from last quarter, and up modestly from 62% of net assets at the beginning of the year.
Effective Net Long means (i) the sum of a portfolio’s long positions (such as common stocks, or derivatives where the price increases when an index or position rises), minus (ii) the sum of a portfolio’s short positions (such as, derivatives where the price increases when an index or position falls).
 
14  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
 
                                 
Returns
Annualized
             
 
Since
Inception
(6/1/1983)
 
20-year
 
10-year
 
5-year
 
3-year
 
1-year
 
YTD
 
Quarter
 
WPOIX - Investor Class
12.13
%
8.95
%
10.37
%
3.96
%
5.81
%
4.34
%
7.03
%
4.45
%
WPOPX - Institutional Class
12.21
 
9.10
 
10.67
 
4.39
 
6.33
 
4.91
 
7.48
 
4.60
 
S&P 500
11.17
 
7.42
 
11.97
 
13.95
 
17.31
 
17.91
 
10.56
 
7.71
 
Russell 3000
10.96
 
7.82
 
12.01
 
13.46
 
17.07
 
17.58
 
10.57
 
7.12
 
Russell 3000 Value
11.14
 
7.80
 
9.76
 
10.65
 
13.75
 
9.46
 
4.17
 
5.39
 
 
Growth of $10,000
This chart depicts the change in the value of a $10,000 investment in the Partners III Opportunity Fund - Institutional Class for the period since inception (6/1/83) through September 30, 2018, as compared with the growth of the Standard & Poor’s 500, Russell 3000 and Russell 3000 Value Indices during the same period. Index performance is hypothetical and is shown for illustrative purposes only.
       
Top 10 Stock Holdings 
     
 
 
% of Net Assets
 
Berkshire Hathaway Inc. - Class B  
   
13.1
 
Liberty Broadband Corp. - Series A & C  
   
10.1
 
Liberty Global plc - Class C  
   
7.1
 
Mastercard Inc. - Class A  
   
5.6
 
Alphabet, Inc. - Class C  
   
4.9
 
Visa Inc. - Class A  
   
4.6
 
Allergan plc  
   
4.1
 
Liberty SiriusXM Group - Series A & C  
   
4.0
 
Colfax Corp.  
   
3.9
 
Intelligent Systems Corp.  
   
3.7
 
 
   
61.1
 
 
       
Industry Breakdown 
     
 
 
% of Net Assets 
 
Communication Services  
   
34.2
 
Information Technology  
   
22.5
 
Financials  
   
18.0
 
Health Care  
   
7.5
 
Consumer Discretionary  
   
6.2
 
Industrials  
   
6.1
 
Materials  
   
1.4
 
Securities Sold Short  
   
(29.9
)
Short Proceeds/Other  
   
34.0
 
 
   
100.0
 
 
                   
Top Performers
   
Average
       
 
 
Return
   
Weight
   
Contribution
 
Berkshire Hathaway Inc. - Class B  
   
14.7
%
   
12.5
%
   
1.71
%
Liberty Broadband Corp. - Series A & C  
   
11.4
     
9.5
     
1.07
 
Allergan plc  
   
14.7
     
4.5
     
0.67
 
Mastercard Inc. - Class A  
   
13.4
     
5.2
     
0.66
 
Intelligent Systems Corp.  
   
21.9
     
4.0
     
0.65
 
 
                   
Bottom Performers
   
Average
       
 
 
Return
   
Weight
   
Contribution
 
SPDR S&P 500 ETF Trust (short)  
   
7.7
%
   
(21.5
)%
   
(1.61
)%
Invesco QQQ Trust, Series 1 (short)  
   
8.4
     
(7.9
)
   
(0.65
)
Facebook, Inc. - Class A  
   
(15.4
)
   
2.8
     
(0.47
)
Tupperware Brands Corp.  
   
(17.2
)
   
1.8
     
(0.37
)
Summit Materials, Inc. - Class A  
   
(30.7
)
   
0.7
     
(0.17
)
 
Contributions to Fund performance are based on actual daily holdings. Securities may have been bought or sold during the quarter. Source: FactSet Portfolio Analytics
Return shown is the actual quarterly return of the security or combination of share classes.

Returns assume reinvestment of dividends and redemption at the end of each period, and reflect the deduction of annual operating expenses which as stated in its most recent prospectus are 2.14% and 1.63% of the Fund’s Investor and Institutional Class net assets, respectively. Total returns shown include fee waivers and expense reimbursements, if any; total returns would have been lower had there been no waivers and/or reimbursements. Performance data represents past performance, which does not guarantee future results. The investment return and the principal value of an investment in this Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance may be higher or lower than the performance data quoted. Performance data current to the most recent month-end may be obtained at www.weitzinvestments.com/funds_and_ performance/fund_ performance.fs.
See page 6 for additional performance disclosures. See page 70 for a description of all indices.
Performance information does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.
 
15  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
HICKORY FUND
Investment Style: Small- to Mid-Cap Value
Co-Portfolio Managers: Wally Weitz, CFA and Drew Weitz
The Hickory Fund returned +2.71% in the third calendar quarter compared to +4.70% for the Russell 2500 Index (the Fund’s primary benchmark). On a year-to-date basis, the Fund returned +2.98% compared to +10.41% for the Russell 2500.
In mid-August, the ongoing U.S. equity rally added another superlative to its resume, claiming the title of the longest bull market since WWII (as measured by the S&P 500). As the saying goes, “bull markets don’t die of old age,” but we suspect they do become more fragile. That’s not to suggest a bear market is imminent. Many gauges of economic health in the U.S. are still in the green, and we lean toward believing there are more tailwinds than headwinds (domestically, anyway) at present. That does not necessitate, however, that stock prices only move higher. It was just six months ago we wrote in our commentary about the (temporary) return of volatility. We can’t predict when investor anxieties may be triggered, or their source. Instead, we focus on identifying businesses we’d like to own and the prices at which we’d like to buy them. During the third quarter, unfortunately, it was more the former than the latter.
We are pleased to report that last quarter’s top detractor, Liberty Broadband (+11%), nearly recovered all the prior quarter’s decline and earned the top contributor spot for the third quarter. Sentiment across U.S. cable improved as the industry reported solid results. Liberty Broadband in particular rose as investors began to look past a multi-year investment period at Charter, anticipating much-improved cash flow growth. Colfax (+18%) reported better-than-expected earnings, thanks to strong execution and progress on their journey of continuous improvement via the Colfax Business System (CBS). We believe the application of CBS to additional bolt-on or platform-sized acquisitions will continue to add value for shareholders. ACI Worldwide (+14%) rounded out the top three performers after reiterating its outlook for strong new business growth.
Top detractors in the quarter included Summit Materials (-31%) and Tupperware Brands (-17%). We added Summit (a provider of construction materials, including aggregates, cement, ready mix concrete and asphalt paving mix) to the portfolio last quarter.
Mother Nature has not cooperated this season, postponing otherwise strong (and funded) demand for infrastructure projects. These delays pressured Summit’s volumes and pushed out the translation of otherwise healthy demand into cash flow. We believe investors have overreacted, and we used the recent weakness to add to our initial position. Tupperware Brands’ operating results have admittedly been lackluster, but with 90% of its revenues earned outside the United States, investors appear to believe Tupperware is permanently on the “wrong side” of both currency risks and ongoing trade disputes. Although there’s plenty of uncertainty surrounding when these headwinds will abate, given our long-term view of Tupperware’s global business prospects and its stock priced around seven times next year’s earnings, we believe the risk-reward profile to be favorable. We also added to Tupperware in the quarter.
Portfolio activity in the quarter was somewhat limited. In addition to Summit and Tupperware, we added to our positions of Axalta and Liberty Latin America at attractive valuations while trimming our positions in Murphy USA and Wesco Aircraft on strength. We also executed modest trims of Liberty Broadband and Liberty SiriusXM. While these continue to be among our highest-conviction holdings, we elected to sell shares to manage our overall exposure to the cable and satellite industry.
As of this writing, markets are off to a choppy start in the fourth quarter (declines for smaller companies actually began in September), but as our shareholders know, we believe volatility breeds opportunity. We continue to look for opportunities to put your (and our) investment capital productively to work and look forward to reporting our progress to you again next quarter.
 
16  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
 
                                     
Returns 
Annualized
             
 
Since
Inception
(4/1/1993)
 
20-year
 
Since
Investment
Style Inception
(6/30/08)
 
10-year
 
5-year
 
3-year
 
1-year
 
YTD
 
Quarter
 
WEHIX 
9.52
%
6.27
%
8.94
%
9.43
%
4.32
%
7.84
%
1.27
%
2.98
%
2.71
%
Russell 2500 
10.76
 
10.52
 
10.95
 
12.02
 
11.37
 
16.13
 
16.19
 
10.41
 
4.70
 
Russell 2500 Value 
10.93
 
10.24
 
10.12
 
10.53
 
9.99
 
14.51
 
10.24
 
5.75
 
2.67
 
S&P 500 
9.73
 
7.42
 
10.70
 
11.97
 
13.95
 
17.31
 
17.91
 
10.56
 
7.71
 
 
Growth of $10,000
This chart depicts the change in the value of a $10,000 investment in the Hickory Fund for the period since inception (4/1/93) through September 30, 2018, as compared with the growth of the Russell 2500, Russell 2500 Value and Standard & Poor’s 500 Indices during the same period. Index performance is hypothetical and is shown for illustrative purposes only.
 
       
Top 10 Stock Holdings 
     
 
 
% of Net Assets
 
Liberty Broadband Corp. - Series A & C  
   
8.6
 
LICT Corp.  
   
6.2
 
Colfax Corp.  
   
4.9
 
Laboratory Corp. of America Holdings  
   
4.7
 
ACI Worldwide, Inc.  
   
4.5
 
Redwood Trust, Inc.  
   
4.4
 
Liberty SiriusXM Group - Series A & C  
   
4.2
 
GCI Liberty, Inc. - Class A  
   
4.0
 
Compass Minerals International, Inc.  
   
3.4
 
Equity Commonwealth  
   
3.4
 
 
   
48.3
 
 
       
Industry Breakdown 
     
 
 
% of Net Assets 
 
Communication Services  
   
35.9
 
Consumer Discretionary  
   
9.7
 
Materials  
   
9.2
 
Industrials  
   
8.4
 
Information Technology  
   
7.5
 
Health Care  
   
4.7
 
Financials  
   
4.4
 
Real Estate  
   
3.4
 
Cash Equivalents/Other  
   
16.8
 
 
   
100.0
 
 
                   
Top Performers  
                 
     
Average
       
 
 
Return
   
Weight
   
Contribution
 
Liberty Broadband Corp. - Series A & C  
   
11.4
%
   
8.6
%
   
0.95
%
Colfax Corp.  
   
17.7
     
4.5
     
0.75
 
ACI Worldwide, Inc.  
   
14.1
     
4.3
     
0.56
 
GCI Liberty, Inc. - Class A  
   
13.1
     
3.7
     
0.47
 
LICT Corp.  
   
5.2
     
6.1
     
0.31
 
 
                   
Bottom Performers  
                 
     
Average
       
 
 
Return
   
Weight
   
Contribution
 
Summit Materials, Inc. - Class A  
   
(30.7
)%
   
2.4
%
   
(0.78
)%
Tupperware Brands Corp.  
   
(17.2
)
   
2.9
     
(0.56
)
Laboratory Corp. of America Holdings  
   
(3.3
)
   
4.7
     
(0.17
)
Liberty SiriusXM Group - Series A & C  
   
(3.9
)
   
5.0
     
(0.16
)
Axalta Coating Systems Ltd.  
   
(3.8
)
   
3.0
     
(0.12
)
 
Contributions to Fund performance are based on actual daily holdings. Securities may have been bought or sold during the quarter. Source: FactSet Portfolio Analytics
Return shown is the actual quarterly return of the security or combination of share classes.

Returns assume reinvestment of dividends and redemption at the end of each period, and reflect the deduction of the Fund’s annual operating expenses which as stated in its most recent prospectus are 1.24% of the Fund’s net assets. Total returns shown include fee waivers and expense reimbursements, if any; total returns would have been lower had there been no waivers and/ or reimbursements. Performance data represents past performance, which does not guarantee future results. The investment return and the principal value of an investment in this Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance may be higher or lower than the performance data quoted. Performance data current to the most recent month-end may be obtained at www.weitzinvestments.com/funds_and_ performance/fund_ performance.fs.
See page 6 for additional performance disclosures. See page 70 for a description of all indices.
Performance information does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.
 
17  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
BALANCED FUND
Investment Style: Conservative Allocation
Portfolio Manager: Brad Hinton, CFA
The Balanced Fund returned +2.63% in the third quarter compared to +1.82% for the Morningstar Moderately Conservative Target Risk Index (the “Index”). Year to date, the Fund returned +4.09% compared to +1.28% for the Index. U.S. equity markets surged higher in the third quarter, while bond markets posted mixed results. We have navigated reasonably well through 2018’s fits and starts in both stocks and bonds. Longer term, total returns well above inflation have helped our investors steadily build wealth.
(Prior to July 31, 2018, the Balanced Fund’s primary benchmark was a “Blended Index” which weighted the S&P 500 at 60% and weighted the Bloomberg Barclays Intermediate U.S. Government Credit Index at 40%. That Blended Index returned +4.67% for the third quarter and +6.00% year to date. Further, average annual total returns for the Blended Index for the one-, five-, and ten-year periods ended September 30, 2018, were +10.10%, +8.94% and +8.67%.)
We wrote a few years ago that “a hybrid fund is both a natural fit and an uncomfortable decision for many investors. Something else will almost always perform better or look like a smarter decision at any given time.” With stock markets near all-time highs, risk-on has clearly been the place to be. Bonds have sputtered, but they finally offer respectable income again. With that backdrop, let’s revisit the scorecard versus our conservative allocation peers for additional context.
             
As of 9/30/18 
 
 
Annualized 
2Percentile Rank in Category 
YTD-18 
1-year 
3-year 
5-year 
7-year 
10-year 
 
5 
9 
20 
30 
12 
17 
3Morningstar RatingTM 
 
 
**** 
**** 
 
**** 
 
1 Returns assume reinvestment of dividends and redemption at the end of each period, and reflect the deduction of annual operating expenses, which as stated in the most recent Prospectus are 1.00% (gross) of the Fund’s net assets. Returns also include fee waivers and/or expense reimbursements, if any; total returns would have been lower had there been no waivers or reimbursements. The Investment Adviser has agreed in writing to waive its fees and reimburse certain expenses (excluding taxes, interest, brokerage costs, acquired fund fees and expenses and extraordinary expenses) to limit the total annual fund operating expenses to 0.85% of average daily net assets through July 31, 2019.
2 Balanced Fund had a percentile ranking against the following number of Allocation–30% to 50% Equity funds for the time periods as follows: YTD 5 out of 522 funds; 1-year 9 out of 513 funds; 3-year 20 out of 441 funds; 5-year 30 out of 355 years; 7-year 12 out of 304 funds; and 10-year 17 out of 256 funds, all as of September 30, 2018. Source: Morningstar Direct
3 Balanced Fund was rated against the following numbers of Allocation–30% to 50% Equity funds over the following time periods: 439 funds in the last three years, 355 funds in the last five years, and 256 funds in the last ten years, as of September 30, 2018. Past performance is no guarantee of future results. Source: Morningstar Essentials
It has been a nice run. Absolute returns have been solid, relative results even better. While we haven’t topped the charts, the old pontoon boat has been pretty steady and reliable. But as we all know, past performance doesn’t guarantee future results. What matters from here is whether we can keep it going for the next 10 years. And if so, how and why?
“Most business edges are found at the intersection of trust and simplicity.” -
Morgan Housel
Since the Fund’s inception, we have relentlessly pursued success through simplicity: a daily mindset of winning by not losing; bottom-up security selection; straight-forward asset allocation; no financial engineering. You know what you own. We also hope to have earned your trust through our words, actions and track record. We have reduced the Fund’s management fee in each of the past two years, and we have agreed to cap the Fund’s total annual operating expenses to 0.85% (see footnote 1). In our view, the current expense ratio offers solid value to all stakeholders.
Portfolio Update
We hold equity stakes in 30 companies representing 46.6% of net assets. Our fixed income holdings include corporate bonds (20.3%), Treasury securities (28.7%) and a touch of securitized debt (3.5%). We bought shares in discount broker turned bank Charles Schwab during the quarter. Schwab has methodically taken market share from major banks and traditional brokers with innovative, low-cost platforms tailored to both individuals and investment advisors. We love scale businesses that consistently share the benefits of size with their customers. Schwab’s results suggest clients continue to “vote with their feet” by bringing new accounts and a greater share of their assets.
We also added leading flooring manufacturer Mohawk Industries back to the portfolio. Mohawk has strong platforms in ceramic tile, carpet, laminates and vinyl. The company expanded its manufacturing footprint significantly over the past few years, and investors are concerned about the timing. Worries include housing softening or rolling over, margin pressure from cost inflation, and potential oversupply in luxury vinyl tile. We think these concerns are priced into the stock at less than 13 times our estimated earnings power. While the business is clearly cyclical, CEO Jeff Lorberbaum is an adept leader with a knack for creating long-term value in his industry.
Year to date, our top stock performers outweighed the bottom performers by three to one in contribution impact. The biggest winners included several of the best companies that we own. Visa and Mastercard topped the charts as they continued to stamp out impressive revenue and profit growth. Thermo Fisher Scientific and Guidewire Software have deep competitive moats in businesses with nice tailwinds, a strong combination. Anheuser-Busch InBev was our largest detractor due to soggy results in the U.S., blooming emerging market woes and a debt-laden balance sheet. Progress has been choppier than expected after the 2016 SABMiller acquisition. We still think this dominant global business can earn $6-$7 per share in a few years, which would make today’s $87 stock price worth the wait. Comcast declined during the strategic tug-of-war over acquisition targets Twenty-First Century Fox and Sky PLC. Comcast’s acquisition of Sky will be pricey and will be a show-me story, but the core Comcast business is quite cheap. Martin Marietta Materials and Vulcan Materials fell due to broader investor concerns about housing. We are drawn to the visible public infrastructure demand and entrenched structural advantages for these leading aggregates businesses. A rundown of quarterly top and bottom performers is shown on the table on the following page.
Thank you as always for your continued investment and confidence in our firm. We look forward to updating you on portfolio developments again at year end.
© 2018 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar; (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. Past performance is no guarantee of future results.
The Morningstar RatingTM for funds, or “star rating”, is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product’s monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product 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. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
 
18  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
                             
Returns 
                           
 
Annualized
             
 
Since
                         
 
Inception
                         
 
(10/1/2003)
 
10-year
 
5-year
 
3-year
 
1-year
 
YTD
 
Quarter
 
WBALX 
5.57
%
7.35
%
5.15
%
7.32
%
5.99
%
4.09
%
2.63
%
Moderately Conservative 
5.98
 
6.04
 
4.96
 
6.69
 
3.91
 
1.28
 
1.82
 
Blended 
7.27
 
8.67
 
8.94
 
10.59
 
10.10
 
6.00
 
4.67
 
 

Growth of $10,000
This chart depicts the change in the value of a $10,000 investment in the Balanced Fund for the period since inception (10/1/03) through September 30, 2018, as compared with the growth of the Moderately Conservative and Blended Indices during the same period. Index performance is hypothetical and is shown for illustrative purposes only.
       
Top 10 Stock Holdings 
     
 
 
% of Net Assets
 
Berkshire Hathaway Inc. - Class B  
   
2.4
 
Liberty Broadband Corp. - Series C  
   
2.2
 
Alphabet, Inc. - Class C  
   
2.1
 
Laboratory Corp. of America Holdings  
   
2.1
 
Thermo Fisher Scientific Inc.  
   
2.1
 
Visa Inc. - Class A  
   
2.1
 
Allergan plc  
   
2.0
 
Oracle Corp.  
   
2.0
 
Mastercard Inc. - Class A  
   
2.0
 
Praxair, Inc.  
   
2.0
 
 
   
21.0
 
 
       
Industry Breakdown 
     
 
 
% of Net Assets 
 
Information Technology  
   
12.3
 
Financials  
   
7.9
 
Health Care  
   
7.6
 
Materials  
   
6.6
 
Communication Services  
   
6.2
 
Consumer Staples  
   
4.0
 
Consumer Discretionary  
   
2.0
 
Total Common Stocks  
   
46.6
 
U.S. Treasury Notes  
   
28.7
 
Corporate Bonds  
   
20.3
 
Mortgage-Backed Securities  
   
2.2
 
Asset-Backed Securities  
   
1.3
 
Cash Equivalents/Other  
   
0.9
 
Total Bonds & Cash Equivalents  
   
53.4
 
 
   
100.0
 
 
                   
Top Stock Performers 
                 
     
Average
       
 
 
Return
   
Weight
   
Contribution
 
Berkshire Hathaway Inc. - Class B  
   
14.7
%
   
2.7
%
   
0.39
%
Oracle Corp.  
   
17.5
     
2.3
     
0.37
 
Thermo Fisher Scientific Inc.  
   
17.9
     
2.1
     
0.35
 
Allergan plc  
   
14.7
     
2.1
     
0.30
 
Visa Inc. - Class A  
   
13.5
     
2.3
     
0.30
 
 
                   
Bottom Stock Performers 
                 
     
Average
       
 
 
Return
   
Weight
   
Contribution
 
Martin Marietta Materials, Inc.  
   
(18.3
)%
   
1.1
%
   
(0.22
)%
Anheuser-Busch InBev SA/NV - Sponsored ADR  
   
(13.1
)
   
1.4
     
(0.18
)
Vulcan Materials Co.  
   
(13.6
)
   
1.1
     
(0.15
)
Marvell Technology Group Ltd.  
   
(9.7
)
   
1.0
     
(0.10
)
The Charles Schwab Corp.  
   
(3.6
)
   
0.8
     
(0.07
)
 
Contributions to Fund performance are based on actual daily holdings. Securities may have been bought or sold during the quarter. Source: FactSet Portfolio Analytics
Return shown is the actual quarterly return of the security or combination of share classes.

Returns assume reinvestment of dividends and redemption at the end of each period, and reflect the deduction of the Fund’s annual operating expenses which as stated in its most recent prospectus are 1.00% (gross) of the Fund’s net assets. Total returns shown include fee waivers and expense reimbursements, if any; total returns would have been lower had there been no waivers and/ or reimbursements. Performance data represents past performance, which does not guarantee future results. The investment return and the principal value of an investment in this Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance may be higher or lower than the performance data quoted. Performance data current to the most recent month-end may be obtained at www.weitzinvestments.com/funds_and_ performance/fund_ performance.fs.
See page 6 for additional performance disclosures. See page 70 for a description of all indices.
Performance information does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.
 
19  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
CORE PLUS INCOME FUND
Investment Style: Intermediate-Term Bond
Co-Portfolio Managers: Tom Carney, CFA & Nolan Anderson
Core Plus Income Fund’s Institutional Class returned +0.07% for the third calendar quarter compared to a +0.02% return for the Bloomberg Barclays U.S. Aggregate Bond Index (Bloomberg Barclays U.S. Agg), our primary benchmark. For the calendar year to date, Core Plus Income Fund’s Institutional Class returned +0.05% compared to a -1.60% return for the Bloomberg Barclays U.S. Agg. We are pleased with the Fund’s relative performance in this rising interest rate environment.
The Fund’s Institutional Share Class has generated a performance track record ranking in the top decile of its Morningstar peer group (Intermediate-Term Bond) for the one- and three-year periods as of September 30, 20181. The Fund’s performance table following this letter shows returns over various holding periods.
Overview
The U.S. economy is thriving so far in 2018, as improvements in various economic data points have been recorded with each passing month. The unemployment rate and its close cousin, the monthly average of jobless claims, measured at the lowest levels since 1969, during the quarter. Wage growth as reported by the Labor Department hit the highest level since 2009, as inflation pressures, while still reasonably tame, continue to percolate in the U.S. economy. Consumer confidence registered its highest reading since 2000. And small-business sentiment as measured by a survey by the National Federation of Independent Business came in during the quarter at the highest reading since the survey began in 1974.
Other major economies are not faring nearly as well. Europe’s growth rate is waning, while emerging markets–last year’s standout performer–are struggling in the face of high debt, currency weakness, costly oil and trade worries.
Worries about global trade relationships are steady headline fodder, but more than six months after the first proposed tariffs on certain metals imports, markets are still discounting the likelihood that current tensions–particularly between the White House and China–will devolve into a full-blown trade war. The longer this goes on, the greater the risk that either side or both overplay their hand, and that markets and the global economy will have to deal with the unhappy consequences.
U.S. Treasury bond yields took their cue from the strong domestic economic data and continued to march higher (prices lower) in the quarter. Shorter-term interest rates rose slightly more than longer-term rates, as market participants anticipate additional tightening measures by the Federal Reserve later this year and into 2019. The Federal Reserve raised short-term interest rates in late September, which was the third rate increase in 2018 and the eighth since the current tightening cycle began in late 2015. The Fed has said it will keep raising rates until it sees evidence that higher interest rates are hurting the U.S. economy. Short-term rates generally more closely follow the Fed’s expected and actual monetary policy action.
As a result, the difference between short- and longer-term bond yields continued to narrow in the quarter as the yield curve continued to “flatten.” A flattening invariably occurs when the Fed embarks on a monetary-tightening campaign. An example of the yield curve flattening can be seen in the difference between 2-year and 10-year Treasury bond yields. Over the past 10 years, the difference between 2-year and 10-year Treasury bond yields has averaged more than 150 basis points. This is understandable considering investors typically want to be compensated for lending money over longer periods of time. This is called the “term premium” in industry parlance.
In the third quarter, the difference between 2-year and 10-year Treasury bond yields hit its lowest point over the past 10 years, at less than 30 basis points. The yield curve has yet to “invert,” where short-term yields exceed longer-term yields but is an important market occurrence to monitor since an inversion of the yield curve has often been a reliable signal for heightened recession risk.
The economic data continues to give “all clear” or “smooth sailing” signals–and the Fed seems intent on continuing to raise short-term rates. The risk is that the economic evidence reveals itself too late, and the Fed ends up overshooting on rates. Overall, the yield curve is something we will be monitoring in the months and quarters ahead.
1The Weitz Core Plus Income Fund’s Institutional Class had a 1-year percentile ranking of 7 out of 1039 intermediate-term bond funds, and 3-year percentile ranking of 9 out of 902 intermediate-term bond funds as of September 30, 2018.
The chart below provides an overview of select U.S. Treasury bond yields for the quarter and the past twelve months.

 
Corporate bonds and other credit-sensitive securities outperformed Treasury bonds in the quarter as credit spreads narrowed/declined, particularly for non-investment-grade or high-yield bonds. A broad measure of investment-grade2 corporate bond spreads, compiled by Merrill Lynch, declined to 113 basis points as of September 30, down 27 basis points in the quarter.
The chart below, courtesy of Morgan Stanley, portrays total returns and excess returns as compared to U.S. Treasuries across quality segments of the corporate bond marketplace, from very high quality (AAA) to the lowest-quality segment (CCC). The CCC segment leads the pack once again.
 

Both investment-grade (IG) and high-yield (HY) option-adjusted spreads2 (OAS) remain near the lowest, or tightest, levels since before the 2008-09 recession and not much further from all-time lows/“tights.”
This has translated into an environment where investors are being paid less, as measured by the incremental spread over safer alternatives like U.S. Treasuries, to assume credit risk. The seeming tranquility, if not complacency, of today’s credit and overall bond market will inevitably be followed by more turbulence. Timing is unknown, of course, but history is a good guide in that regard. We intend to remain vigilant/disciplined and invest only in those areas of the marketplace that present the most favorable risk/reward opportunities, and we look forward to taking advantage of the inevitable dislocations that will occur sometime in the future.
Portfolio Positioning
The table below shows the change in allocation to various sectors from the most recent quarter and compared to a year ago. This summary provides a view over time of how we have allocated capital.
Since our goal is to invest in sectors that we believe offer the best risk-adjusted returns, our allocations may change significantly over time.
 
20  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
       
Sector (% Net Assets) 
9/30/2018 
6/30/2018 
9/30/2017 
Corporate Bonds 
23.9 
25.3 
28.9 
Corporate Convertible Bonds 
1.8 
2.0 
2.4 
Asset-Backed Securities (ABS) 
25.4 
22.7 
21.2 
Commercial Mortgage-Backed Securities (CMBS) 
1.8 
3.9 
2.2 
Agency Mortgage-Backed (MBS) 
0.1 
0.1 
0.3 
Non-Agency Mortgage-Backed (RMBS) 
3.1 
3.5 
4.6 
Taxable Municipal Bonds 
0.8 
0.8 
1.0 
U.S. Treasury 
39.6 
36.3 
38.0 
Common Stocks 
0.5 
0.7 
0.6 
Cash & Equivalents 
3.0 
4.7 
0.8 
Total 
100.0 
100.0 
100.0 
High Yield* 
11.7 
12.4 
7.7 
 
*High Yield exposure (as of 9/30/2018) consists of investments in the Corporate, Corporate Convertible, ABS and MBS sectors.
The primary shift in asset allocation during the quarter was toward U.S. Treasury bonds and asset-backed securities. As we have discussed in prior letters, we are at times willing to hold large amounts of liquidity while we seek out qualifying investment opportunities. We have a growing list of corporate and asset-backed issuers that we would like to own at the right price and are ready to act should an opportunity arise.
As of September 30, our high-yield exposure was approximately 11.7%, down from 12.4% as of June 30 (the maximum we are permitted is 25%). However, approximately 3.0% of our high-yield exposure is to split-rated credits (i.e., bonds rated investment grade by one or more rating agencies) that would be counted as investment-grade exposure if they are a part of the Barclays Indexes. Since the Fund’s 2014 inception, we have flexed our high-yield allocation meaningfully–from a low of 5.9% to a maximum of 24.9%.
Overall portfolio metrics as measured by average effective maturity and average effective duration changed modestly compared to the prior quarter. The average effective maturity increased to 5.1 years from 4.9 years, and the average effective duration increased to 4.4 years from 4.2 years. Consistent with the Fund’s positioning since inception, we maintain a significantly lower average effective duration profile than the benchmark duration of 6.0 years for the Bloomberg Barclays U.S. Agg.
Overall, we continue to believe that a shorter duration profile is prudent, particularly from a credit risk management perspective. As of September 30, the duration of our credit-sensitive ABS and CMBS investments (representing 27% of Net Assets) was 1.2 years, while our corporate credit portfolio (representing 26% of Net Assets) had a duration of 2.9 years. We remain willing to increase our duration if interest rates and/or credit spreads increase to provide sufficient risk-adjusted returns.
Top Quarterly Contributors
Sector allocation and security selection were the key drivers of performance. Overall, the Fund benefited from its overweight position in ABS and high yield, as both benefited from a shorter duration profile and tightening credit spreads. Primary contributors included:
Asset-Backed Securities (ABS): Our automobile, consumer and equipment ABS continued to perform at or above expectations with respect to credit performance and average life progression2 while providing steady income and price appreciation.
 
Corporate Bonds: Our diversified portfolio of investment-grade and high-yield corporate bonds across energy, financials, industrials and telecommunications benefited from solid coupon income and (unrealized) price appreciation as credit spreads contracted during the quarter.
 
Mortgage-Backed Securities: Non-Agency Residential Mortgage- Backed (RMBS) and Commercial Mortgage-Backed (CMBS) securities generated positive contributions to Fund results as solid coupon income more than offset modest (unrealized) price depreciation.
 
Top Quarterly Detractors
U.S. Treasury Bonds: Our portfolio of U.S. Treasury bonds, particularly longer maturity, were the largest detractor to performance during the third quarter. The size and duration of our Treasury portfolio ebbs and flows based on our view of market conditions. More target-rich investment conditions likely warrant a much smaller Treasury portfolio than we have today. At the same time, as interest rates continue to increase, the coupon income generation of Treasury bonds is becoming more attractive, as is the potential for price appreciation should market conditions suddenly change course and interest rates decline. Overall, we like the mix of coupon income, diversification, liquidity and optionality that Treasury bonds bring to the portfolio.
 
Investment Activity
Investment activity was weighted toward Treasuries (primarily 6- to 10-year maturities), followed by asset-backed securities and corporate credit. In ABS, we added to our auto and consumer ABS positions. All investment activity was targeted toward repeat issuers with whom we have existing lending relationships. Most of our new ABS investments are backed by seasoned collateral pools that we think have exhibited stable or better-than-expected credit performance. The investments have weighted average lives of 1-2 years, and we expect to earn 3-5% over our investment horizon.
As we lap the tenth anniversary of the cathartic phase of the Great Recession, some of the memories of those grim days in the financial markets appear to have faded a bit. The world’s central banks have flooded their economies with liquidity and made credit available at artificially low interest rates. Over time, this has resulted in a gradual lowering of risk aversion as evidenced by current cycle-low credit spreads, particularly in high yield. Weaker security structures via covenant-light loans (i.e., lesser ongoing obligations on the part of the borrower) are also becoming more prevalent. We avoid making bold or specific predictions about the direction and pace interest rates or credit spreads might move in the future. But we do identify with the wise words of Oaktree Capital’s founder and co-chairman Howard Marks when he says it’s important to “take the temperature of the market.” In that regard, we may not be at the extreme risk-taking levels that helped precipitate the Great Recession–but we are far from the “fat pitch” investments that were abundant in 2009. In Mr. Mark’s words once again, we believe now is a time to “move forward, but with caution.”
Caution has arguably always been our calling card in managing the Fund. Our overall goal is to invest in a portfolio of bonds of varying maturities that we believe represents attractive risk-adjusted returns, taking into consideration the general level of interest rates and the credit quality of each investment. Today we are exercising that caution by lowering duration in our credit-sensitive investments, particularly corporate bonds, and enhancing/ improving overall credit quality.
We will patiently seek out areas of opportunity and invest one security at a time, relying on a fundamental research-based investment approach. Markets invariably do change, and given the Fund’s abundant liquidity in the form of U.S. Treasuries, we stand ready to take advantage of any potential market weakness.
We thank you for your continued support, and we will work diligently to maintain your trust.
© 2018 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar; (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. Past performance is no guarantee of future results.
2Definitions: Investment Grade: We consider investment grade to be those securities rated at least BBB- by one or more credit ratings agencies. Option Adjusted Spread: A “spread” compares the interest rate on a particular bond against a “base line” bond (typically a U.S. Treasury bond). When a bond issuer (or bondholder) has the option to exercise a right (for example, if the issuer can call a bond before its stated maturity date), then the “Option Adjusted Spread” takes into account the possibility that this option might be exercised—so a bond’s Option Adjusted Spread may be more (or less) than its regular spread. Average Life Progression: A measure of repayment speed for a collateral pool (for example, a collection of mortgages may serve as the collateral pool for an issuance of mortgage-backed securities).
 
21  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED


CORE PLUS INCOME FUND (CONTINUED)
 
                     
Returns
Annualized
             
 
Since Inception
(7/31/2014)
 
3-year
 
1-year
 
YTD
 
Quarter
 
WCPNX - Investor Class 
2.59
%
2.68
%
0.07
%
(0.09
)%
0.12
%
WCPBX - Institutional Class 
2.79
 
2.88
 
0.27
 
0.05
 
0.07
 
Bloomberg Barclays U.S. Aggregate Bond 
1.75
 
1.31
 
(1.22
)
(1.60
)
0.02
 
 
   
Five Largest Corporate Bond Issuers 
 
Issuer 
% of Securities 
Equity Commonwealth 
2.6 
Markel Corp. 
2.1 
Andeavor Logistics LP 
1.9 
Redwood Trust, Inc. 
1.8 
RELX plc 
1.4 
 
   
Financial Attributes 
 
 
Portfolio Summary 
 
Average Maturity(d) 
5.2 years 
Average Effective Maturity(d) 
5.1 years 
Average Duration(d) 
4.4 years 
Average Effective Duration(d) 
4.4 years 
Average Coupon(d) 
3.4% 
30-Day SEC Yield - Investor Class 
2.98% 
30-Day SEC Yield - Institutional Class 
3.18% 
 
   
Maturity Distribution(d) 
 
 
Maturity Type 
% of Portfolio 
Cash Equivalents 
2.4 
Less than 1 Year 
15.0 
1 - 3 Years 
27.7 
3 - 5 Years 
8.4 
5 - 7 Years 
15.7 
7 - 10 Years 
26.8 
10 Years or more 
3.5 
Common Stocks 
0.5 
 
100.0 
 
Credit Quality(a)(d)
 
 
Underlying Securities 
% of Portfolio 
U.S. Treasury 
39.8 
U.S. Government Agency Mortgage 
0.1 
Related Securities(b) 
 
Aaa/AAA 
7.8 
Aa/AA 
10.1 
A/A 
8.3 
Baa/BBB 
19.0 
Ba/BB 
5.5 
B/B 
3.2 
Caa/CCC 
1.4 
Non-Rated 
1.9 
Common Stocks 
0.5 
Cash Equivalents 
2.4 
 
100.0 
 

(a) The Fund receives credit quality ratings on underlying securities of the Portfolio when available from credit rating agencies. The Fund will use one rating for an underlying security if that is all that is provided. Ratings and portfolio credit quality may change over time. The Fund itself has not been rated by an independent rating agency.
(b) Mortgage related securities issued and guaranteed by government-sponsored entities such as Fannie Mae and Freddie Mac are generally not rated by ratings agencies. Securities which are not rated do not necessarily indicate low quality. Fannie Mae’s and Freddie Mac’s senior long-term debt are currently rated Aaa and AAA by Moody’s and Fitch, respectively.
(c) Percent of net assets
(d) Source: Bloomberg Analytics

Returns assume reinvestment of dividends and redemption at the end of each period, and reflect the deduction of annual operating expenses which as stated in its most recent prospectus are 1.65% (gross) and 1.09% (gross) of the Fund’s Investor and Institutional Class net assets, respectively. Total returns shown include fee waivers and expense reimbursements, if any; total returns would have been lower had there been no waivers and/or reimbursements. Past performance does not guarantee future results. The investment return and the principal value of an investment in this Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance may be higher or lower than the performance data quoted. Performance data current to the most recent month-end may be obtained at www.weitzinvestments.com/funds_and_performance/fund_performance.fs.
See page 6 for additional performance disclosures. See page 70 for a description of all indices.
Performance information does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.
 
22  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
SHORT DURATION INCOME FUND
Investment Style: Short-Term Bond
Co-Portfolio Managers: Tom Carney, CFA & Nolan Anderson
The Short Duration Income Fund’s Institutional Class returned +0.36% in the third calendar quarter compared to a +0.34% return for the Bloomberg Barclays 1-3 Year U.S. Aggregate Index (Bloomberg Barclays U.S. Agg 1-3), the Fund’s primary benchmark. For the calendar year to date, the Fund’s Institutional Class returned +0.54% compared to a +0.42% return for the benchmark.
Overview
The U.S. economy is thriving so far in 2018, as improvements in various economic data points have been recorded with each passing month. The unemployment rate and its close cousin, the monthly average of jobless claims, measured at the lowest levels since 1969, during the quarter. Wage growth as reported by the Labor Department hit the highest level since 2009, as inflation pressures, while still reasonably tame, continue to percolate in the U.S. economy. Consumer confidence registered its highest reading since 2000. And small-business sentiment as measured by a survey by the National Federation of Independent Business came in during the quarter at the highest reading since the survey began in 1974.
Other major economies are not faring nearly as well. Europe’s growth rate is waning, while emerging markets–last year’s standout performer–are struggling in the face of high debt, currency weakness, costly oil and trade worries.
Worries about global trade relationships are steady headline fodder, but more than six months after the first proposed tariffs on certain metals imports, markets are still discounting the likelihood that current tensions–particularly between the White House and China–will devolve into a full-blown trade war. The longer this goes on, the greater the risk that either side or both overplay their hand, and that markets and the global economy will have to deal with the unhappy consequences.
U.S. Treasury bond yields took their cue from the strong domestic economic data and continued to march higher (prices lower) in the quarter. Shorter-term interest rates rose slightly more than longer-term rates, as market participants anticipate additional tightening measures by the Federal Reserve later this year and into 2019. The Federal Reserve raised short-term interest rates in late September, which was the third rate increase in 2018 and the eighth since the current tightening cycle began in late 2015. The Fed has said it will keep raising rates until it sees evidence that higher interest rates are hurting the U.S. economy. Short-term rates generally more closely follow the Fed’s expected and actual monetary policy action.
As a result, the difference between short- and longer-term bond yields continued to narrow in the quarter as the yield curve continued to “flatten.” A flattening invariably occurs when the Fed embarks on a monetary-tightening campaign. An example of the yield curve flattening can be seen in the difference between 2-year and 10-year Treasury bond yields. Over the past 10 years, the difference between 2-year and 10-year Treasury bond yields has averaged more than 150 basis points. This is understandable considering investors typically want to be compensated for lending money over longer periods of time. This is called the “term premium” in industry parlance.
In the third quarter, the difference between 2-year and 10-year Treasury bond yields hit its lowest point over the past 10 years, at less than 30 basis points. The yield curve has yet to “invert,” where short-term yields exceed longer-term yields but is an important market occurrence to monitor since an inversion of the yield curve has often been a reliable signal for heightened recession risk.
The economic data continues to give “all clear” or “smooth sailing” signals–and the Fed seems intent on continuing to raise short-term rates. The risk is that the economic evidence reveals itself too late, and the Fed ends up overshooting on rates. Overall, the yield curve is something we will be monitoring in the months and quarters ahead.
The chart below provides an overview of select U.S. Treasury bond yields for the quarter and the past twelve months.
U.S. Treasury Yields (%)

Source: Bloomberg
Corporate bonds and other credit-sensitive securities outperformed Treasury bonds in the quarter as credit spreads narrowed/declined, particularly for non-investment-grade or high-yield bonds. A broad measure of investment-grade1 corporate bond spreads, compiled by Merrill Lynch, declined to 113 basis points as of September 30, down 27 basis points in the quarter.
The chart below, courtesy of Morgan Stanley, portrays total returns and excess returns as compared to U.S. Treasuries across quality segments of the corporate bond marketplace, from very high quality (AAA) to the lowest-quality segment (CCC). The CCC segment leads the pack once again.
 

IG = Investment Grade HY = High Yield
Both investment-grade (IG) and high-yield (HY) option-adjusted spreads1 (OAS) remain near the lowest, or tightest, levels since before the 2008-09 recession and not much further from all-time lows/“tights.”
This has translated into an environment where investors are being paid less, as measured by the incremental spread over safer alternatives like U.S. Treasuries, to assume credit risk. The seeming tranquility, if not complacency, of today’s credit and overall bond market will inevitably be followed by more turbulence. Timing is unknown, of course, but history is a good guide in that regard. We intend to remain vigilant/disciplined and invest only in those areas of the marketplace that present the most favorable risk/reward opportunities, and we look forward to taking advantage of the inevitable dislocations that will occur sometime in the future.
 
23  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

SHORT DURATION INCOME FUND (CONTINUED)
 
Portfolio Positioning
The table below shows the change in allocation to various sectors from the most recent quarter and compared to a year ago. This summary provides a view over time of how we have allocated capital.
Since our goal is to invest in sectors that we believe offer the best risk-adjusted returns, our allocations may change significantly over time.
       
Sector (% Net Assets) 
9/30/2018 
6/30/2018 
9/30/2017 
Corporate Bonds 
36.6 
37.1 
41.4 
Corporate Convertible Bonds 
3.5 
3.3 
5.2 
Asset-Backed Securities (ABS) 
13.0 
11.0 
7.2 
Commercial Mortgage-Backed Securities (CMBS) 
1.3 
1.4 
0.5 
Agency Mortgage-Backed (MBS) 
11.9 
12.0 
12.8 
Non-Agency Mortgage-Backed (RMBS) 
4.9 
4.9 
4.6 
Taxable Municipal Bonds 
0.2 
0.3 
0.4 
U.S. Treasury 
27.5 
26.5 
26.4 
Common Stocks 
0.4 
0.4 
0.7 
Cash & Equivalents 
0.7 
3.1 
0.8 
Total 
100.0 
100.0 
100.0 
High Yield* 
7.9 
8.1 
10.0 

*High Yield exposure (as of 9/30/2018) consists of investments in the Corporate, Corporate Convertible, ABS and RMBS sectors.
The most noteworthy changes in allocation over the past quarter, and 12 months, occurred in the corporate bond and asset-backed (ABS) segments. The Fund’s corporate segment declined modestly in the quarter but decreased approximately 500 basis points in the past year. Lower corporate bond credit spreads, particularly in shorter-term securities, have resulted in a less favorable risk/reward setting. As corporate bonds have matured, proceeds have been increasingly allocated to the ABS segment, where portfolio allocation increases in the past quarter, and 12 months, have nearly mirrored the decline in the corporate segment. We continue to enhance our circle of competence in ABS via hands-on research (i.e., “boots on the ground” meetings with ABS sponsors/managements) and thorough bottom-up analysis of the structures of each security (e.g., collateral pool characteristics, seniority of payment, credit enhancement levels and more). Presently, we believe select ABS investments provide increased cash flow returns with shorter duration than comparable corporate bonds (See Investment Activity below for a specific discussion on our ABS investments).
As of September 30, our high-yield exposure was approximately 7.9%, down modestly from June 30 (our maximum threshold is 15%). Our high-yield exposure continues to be primarily concentrated in higher-quality, shorter-term bonds that we believe have attractive risk/reward profiles (e.g., companies with strong asset and liquidity positions).
Overall portfolio metrics as measured by average maturity and average effective duration were unchanged in the quarter at 2.1 and 1.9 years, respectively. These measures provide a guide to the Fund’s interest rate sensitivity. A lower average effective maturity and shorter average effective duration reduce the Fund’s price sensitivity to changes in interest rates (either up or down).
Top Quarterly Contributors
Asset-Backed Securities (ABS): The segment was the largest contributor to results in the quarter. Investments within ABS continued to perform at or above expectations with respect to credit performance and average life progression1, while providing steady/ strong coupon income and minimal price volatility.
 
Corporate Bonds: Coupon income and declining credit spreads offset modest (unrealized) price depreciation from rising base/ Treasury interest rates. Primary contributors included the real estate investment trust (REIT), banks, insurance, and oil and gas segments.
 
Mortgage-Backed Securities: Agency Mortgage-Backed (MBS), Non-Agency Residential Mortgage-Backed (RMBS) and Commercial Mortgage-Backed (CMBS) securities generated positive contributions to Fund results as solid coupon income more than offset modest (unrealized) price depreciation.
 
 •
U.S. Treasury Bonds: Despite the increase in U.S. Treasury rates in September (modest throughout the quarter), the Fund’s laddered U.S. Treasury portfolio contributed positively to results.
 
Top Quarterly Detractors
No segment or security detracted from Fund results in the quarter. Coupon or dividend income more than offset any (unrealized) price depreciation, and position sizing mitigated any single security price decline from impacting overall Fund results.
 
Investment Activity
Portfolio investment allocation was weighted toward the ABS segment in the quarter. We increased our investment in Marlette Funding by participating in the company’s third securitization in 2018. Since its founding in 2013, Marlette has become a top 5 lender in online lending. The company has facilitated more than $5 billion in loans via their “Best Egg” platform to more than 350,000 people, who use the loans to finance large purchases or to consolidate and pay off debt. The company’s leadership has incorporated decades of banking experience with deep customer knowledge and state-of-the-art technology to deliver products and services to consumers. We have met or spoken with management on numerous occasions and have come away exceedingly comfortable with the company’s underwriting discipline. Our short average life (less than one year) investment during the quarter should generate coupon returns of more than three percent. It represents the senior-most layer of the company’s securitization, where we believe credit support meaningfully exceeds expected losses for the pool of loans.
As we lap the tenth anniversary of the cathartic phase of the Great Recession, some of the memories of those grim days in the financial markets appear to have faded a bit. The world’s central banks have flooded their economies with liquidity and made credit available at artificially low interest rates. Over time, this has resulted in a gradual lowering of risk aversion as evidenced by current cycle-low credit spreads, particularly in high yield. Weaker security structures via covenant-light loans (i.e., lesser ongoing obligations on the part of the borrower) are also becoming more prevalent. We avoid making bold or specific predictions about the direction and pace interest rates or credit spreads might move in the future. But we do identify with the wise words of Oaktree Capital’s founder and co-chairman Howard Marks when he says it’s important to “take the temperature of the market.” In that regard, we may not be at the extreme risk-taking levels that helped precipitate the Great Recession–but we are far from the “fat pitch” investments that were abundant in 2009. In Mr. Mark’s words once again, we believe now is a time to “move forward, but with caution.”
Caution has arguably always been our calling card in managing the Fund. Our overall goal is to invest in a portfolio of bonds of varying maturities that we believe represents attractive risk-adjusted returns, taking into consideration the general level of interest rates and the credit quality of each investment. Today we are exercising that caution by lowering duration in our credit-sensitive investments, particularly corporate bonds, and enhancing/ improving overall credit quality.
We will patiently seek out areas of opportunity and invest one security at a time, relying on a fundamental research-based investment approach. Markets invariably do change, and given the Fund’s abundant liquidity in the form of U.S. Treasuries, we stand ready to take advantage of any potential market weakness.
We thank you for your continued support, and we will work diligently to maintain your trust.
1Definitions: Investment Grade: We consider investment grade to be those securities rated at least BBB- by one or more credit ratings agencies. Option Adjusted Spread: A “spread” compares the interest rate on a particular bond against a “base line” bond (typically a U.S. Treasury bond). When a bond issuer (or bondholder) has the option to exercise a right (for example, if the issuer can call a bond before its stated maturity date), then the “Option Adjusted Spread” takes into account the possibility that this option might be exercised—so a bond’s Option Adjusted Spread may be more (or less) than its regular spread. Average Life Progression: A measure of repayment speed for a collateral pool (for example, a collection of mortgages may serve as the collateral pool for an issuance of mortgage-backed securities).
 
24  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
 
                                 
Returns 
Annualized
             
 
Since Inception
(12/23/1988)
 
20-year
 
10-year
 
5-year
 
3-year
 
1-year
 
YTD
 
Quarter
 
WSHNX - Investor Class 
4.99
%
3.70
%
2.97
%
1.25
%
1.37
%
0.24
%
0.39
%
0.31
%
WEFIX - Institutional Class 
5.04
 
3.78
 
3.13
 
1.47
 
1.58
 
0.43
 
0.54
 
0.36
 
Bloomberg Barclays 1-3 Year U.S. Aggregate 
 
3.17
 
1.76
 
0.86
 
0.74
 
0.22
 
0.42
 
0.34
 
CPI + 1% 
3.54
*
3.22
 
2.46
 
2.53
 
3.01
 
3.30
 
3.17
 
0.43
 
 
* Since 12/31/1988
   
Five Largest Corporate Bond Issuers 
Issuer 
% of Securities 
Wells Fargo 
4.2 
Redwood Trust, Inc. 
3.5 
Markel Corp. 
2.7 
Boston Properties LP 
2.2 
U.S. Bank 
2.1 
 
   
Financial Attributes 
 
 
Portfolio Summary 
 
Average Maturity(d) 
2.1 years 
Average Effective Maturity(d) 
2.1 years 
Average Duration(d) 
1.9 years 
Average Effective Duration(d) 
1.9 years 
Average Coupon(d) 
3.2% 
30-Day SEC Yield - Investor Class 
2.51% 
30-Day SEC Yield - Institutional Class 
2.71% 
 
   
Maturity Distribution(d) 
 
 
Maturity Type 
% of Portfolio 
Cash Equivalents 
0.2 
Less than 1 Year 
33.4 
1 - 3 Years 
44.4 
3 - 5 Years 
15.3 
5 - 7 Years 
5.9 
7 - 10 Years 
0.4 
Common Stocks 
0.4 
 
100.0 
 
 
Credit Quality(a)(d) 
 
 
Underlying Securities 
% of Portfolio 
U.S. Treasury 
27.6 
U.S. Government Agency Mortgage 
11.9 
Related Securities(b) 
 
Aaa/AAA 
9.4 
Aa/AA 
5.0 
A/A 
15.9 
Baa/BBB 
21.5 
Ba/BB 
3.1 
B/B 
1.3 
Caa/CCC 
0.1 
Non-Rated 
3.6 
Common Stocks 
0.4 
Cash Equivalents 
0.2 
 
100.0 
 
(a) The Fund receives credit quality ratings on underlying securities of the Portfolio when available from credit rating agencies. The Fund will use one rating for an underlying security if that is all that is provided. Ratings and portfolio credit quality may change over time. The Fund itself has not been rated by an independent rating agency.
(b) Mortgage related securities issued and guaranteed by government-sponsored entities such as Fannie Mae and Freddie Mac are generally not rated by ratings agencies. Securities which are not rated do not necessarily indicate low quality. Fannie Mae’s and Freddie Mac’s senior long-term debt are currently rated Aaa and AAA by Moody’s and Fitch, respectively.
(c) Percent of net assets
(d) Source: Bloomberg Analytics

Returns assume reinvestment of dividends and redemption at the end of each period, and reflect the deduction of annual operating expenses which as stated in its most recent prospectus are 0.91% (gross) and 0.62% (gross) of the Fund’s Investor and Institutional Class net assets, respectively. Total returns shown include fee waivers and expense reimbursements, if any; total returns would have been lower had there been no waivers and/or reimbursements. Past performance does not guarantee future results. The investment return and the principal value of an investment in this Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance may be higher or lower than the performance data quoted. Performance data current to the most recent month-end may be obtained at www.weitzinvestments.com/funds_and_ performance/fund_ performance.fs.
See page 6 for additional performance disclosures. See page 70 for a description of all indices.
Performance information does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.
 
25  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED


ULTRA SHORT GOVERNMENT FUND
Investment Style: Ultra-Short-Term Bond
Co-Portfolio Managers: Tom Carney, CFA & Nolan Anderson
The Ultra Short Government Fund returned +0.48% in the third calendar quarter compared to a +0.50% return for the ICE BofAML US 6-Month Treasury Bill Index (6-Month Treasury), our Fund’s primary benchmark. For the calendar year to date, the Fund returned +1.21%, compared to +1.30% for the Fund’s primary benchmark.
Overview
U.S. Treasury bond yields took their cue from strong domestic economic data and continued to march higher (prices lower) in the quarter. Shorter-term interest rates rose slightly more than longer-term rates, as market participants anticipate additional tightening measures by the Federal Reserve later this year and into 2019. The Federal Reserve raised short-term interest rates in late September, which was the third rate increase in 2018 and the eighth since the current tightening cycle began in late 2015. The Fed has said it will keep raising short-term interest rates until it sees evidence that higher rates are hurting the U.S. economy.
The Ultra Short Government Fund’s third quarter results kept pace with the Fund’s primary benchmark as modest unrealized price declines in select Fund holdings offset strong income returns in the Fund’s overall portfolio. The Fund’s 30-day yield increased to 2.08% as of September 30 from 1.95% at June 30. Over the past year, the Fund’s 30-day yield has improved by more than 1 percent.
We’ve been quite satisfied with the Fund’s progress to date and believe the Fund’s principal investment strategies and objectives will continue to meet our long-term goals of providing current income, protecting principal and providing liquidity. Under normal conditions, the Fund will invest at least 80% of its net assets in obligations issued or guaranteed by the U.S. government and its government-related entities. The balance of Fund assets may be invested in U.S. investment-grade debt securities. We consider investment grade to be those securities rated at least BBB-by one or more recognized credit ratings firms. Additionally, the Fund will maintain an average effective duration of one year or less. Duration is a measure of how sensitive the Fund’s portfolio may be to changes in interest rates. All else equal, a lower duration portfolio of bonds is less sensitive to changes in interest rates than a portfolio of bonds with a higher duration. Over time, this shorter-term focus (duration of less than one year) is intended to generate higher total returns than cash or money market funds with less interest rate risk than short- or intermediate-term bonds.
The Federal Reserve’s monetary policy decisions (e.g., changes in short-term interest rates) will continue to be the primary agent that will affect all investments within our opportunity set. As a result, our yield and return will invariably follow the path dictated by the Federal Reserve’s monetary policy, as we frequently reinvest holdings that mature in a short period of time.
As of September 30, 81.2% of our portfolio was invested in U.S. Treasury notes, and 18.0% was invested in investment-grade corporate bonds and asset-backed securities, with the balance in a high-quality State Street money market fund. The average effective duration of our portfolio at September 30 was 0.3 years, unchanged from three months ago, as compared to the Fund’s primary index duration of 0.5 years. As mentioned above, we will continue to focus on high credit quality, preservation of capital and maintaining liquidity for our investors.
We thank you for your continued support, and we will work diligently to maintain your trust.
 
26  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM

NEBRASKA TAX-FREE INCOME FUND
Investment Style: Municipal-State Bond
Portfolio Manager: Tom Carney, CFA
The Nebraska Tax-Free Income Fund returned -0.25% in the third calendar quarter compared to a -0.20% return for the Bloomberg Barclays 5-Year Municipal Bond Index, the Fund’s primary benchmark. For the calendar year to date, the Fund returned -0.70% compared to +0.10% for the Fund’s
primary benchmark.
Overview
The U.S. economy is thriving so far in 2018, as improvements in various economic data points have been recorded with each passing month. The unemployment rate and its close cousin, the monthly average of jobless claims, measured at the lowest levels since 1969, during the quarter. Wage growth as reported by the Labor Department hit the highest level since 2009, as inflation pressures, while still reasonably tame, continue to percolate in the U.S. economy. Consumer confidence registered its highest reading since 2000. And small-business sentiment as measured by a survey by the National Federation of Independent Business came in during the quarter at the highest reading since the survey began in 1974.

Other major economies are not faring nearly as well. Europe’s
growth rate is waning, while emerging markets–last year’s standout performer–are struggling in the face of high debt, currency weakness, costly oil and trade worries.

Worries about global trade relationships are steady headline
fodder, but more than six months after the first proposed tariffs on certain metals imports, markets are still discounting the likelihood that current tensions–particularly between the White House and China–will devolve into a full-blown trade war. The longer this goes on, the greater the risk that either side or both overplay their hand, and that markets and the global economy will have to deal with the unhappy consequences.

U.S. Treasury bond yields took their cue from the strong domestic
economic data and continued to march higher (prices lower) in the quarter. Shorter-term interest rates rose slightly more than longer-term rates, as market participants anticipate additional tightening measures by the Federal Reserve later this year and into 2019.

Municipal bonds underperformed their taxable government
counterparts in the quarter as the yield relationship between tax-free municipal bonds and taxable alternatives increased modestly. High-quality 5-year municipal bonds, for example, ended the quarter with a yield representing approximately 75% of U.S. Treasuries, up from 73% at June 30.
The Federal Reserve raised short-term interest rates in late September, which was the third rate increase in 2018 and the eighth since the current tightening cycle began in late 2015. The Fed has said it will keep raising rates until it sees evidence that higher interest rates are hurting the U.S. economy. Short-term rates generally more closely follow the Fed’s expected and actual monetary policy action.
As a result, the difference between short- and longer-term bond yields continued to narrow in the quarter as the yield curve continued to “flatten.” A flattening invariably occurs when the Fed embarks on a monetary-tightening campaign. An example of the yield curve flattening can be seen in the difference between 2-year and 10-year Treasury bond yields. Over the past 10 years, the difference between 2-year and 10-year Treasury bond yields has averaged more than 150 basis points. This is understandable considering investors typically want to be compensated for lending money over longer periods of time. This is called the “term premium” in industry parlance.
In the third quarter, the difference between 2-year and 10-year Treasury bond yields hit its lowest point over the past 10 years, at less than 30 basis points. The yield curve has yet to “invert,” where short-term yields exceed longer-term yields but is an important market occurrence to monitor since an inversion of the yield curve has often been a reliable signal for heightened recession risk.

The economic data continues to give “all clear” or “smooth sailing”
signals–and the Fed seems intent on continuing to raise short- term rates. The risk is that the economic evidence reveals itself too late, and the Fed ends up overshooting on rates. Overall, the yield curve is something we will be monitoring in the months and quarters ahead.

The chart below provides an overview of select U.S. Treasury bond
yields for the quarter and the past twelve months.
 
27  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED


NEBRASKA TAX-FREE INCOME FUND (CONTINUED)
The following chart, courtesy of global market research firm CreditSights, illustrates the municipal bond market yield curve over select intervals from the past twelve months. Since U.S. Treasury bonds act as a form of gravitational pull to all other fixed income sectors, it’s no surprise that the municipal market has also experienced an overall rising but flattening yield curve, where rate increases have most affected bonds with shorter maturities.
Source: CreditSights, MBIS.

Fund Review
The Fund’s results closely followed the benchmark’s results in the quarter but lagged on a year-to-date basis principally due to the nearly one-quarter of Fund investments in 7-year and longer municipal bonds (not present in the benchmark index). The Fund’s greater concentration in bonds maturing in under five years (approximately two-thirds) has become less impacted from short-term rate increases as the Fed has moved further away from its zero interest-rate policy. As a reminder, our investment objective is not to mimic any index but to invest in a portfolio of bonds of varying maturities that we believe represent attractive risk- and tax-adjusted opportunities. Our primary benchmark, on the other hand, is a static index of 4- to 6-year bonds.
Top Quarterly Contributors
General-purpose bonds issued by the city of Omaha.
 
Higher education bonds issued by Angelina County Texas Junior Community College District and Cook, Kane, Lake & McHenry Counties, Illinois Community College District.
 
Hospital bonds issued by Douglas County Nebraska Hospital Authority revenue bonds issued for Methodist Hospital and Madonna Rehabilitation Hospital.
 
Top Quarterly Detractors
 •
Primary and secondary education general-obligation bonds issued by Papillion-La Vista School District.
 
The electricity and public power revenue bonds issued by Dawson Nebraska Public District and Nebraska Public Power District.
 
Investment activity was light in the quarter, as we identified few qualifying investments. Key portfolio metrics for the Fund, average effective duration and average effective maturity, were unchanged in the quarter at 3.8 and 4.2 years, respectively. This compares to the Fund’s benchmark that had an average effective duration 4.0 years and average effective maturity of 4.9 year at quarter end.
Overall credit quality of the Fund remains high, with approximately 89% rated A or better by nationally recognized statistical rating organizations, credit rating agencies recognized by the U.S. Securities and Exchange Commission.
As we have discussed in prior quarters, overall interest rates remain low by historical standards. However, we have been encouraged by the Fed’s progress to “normalize” interest rates, through the third quarter of 2018, by gradually moving away from the zero interest-rate policy that lasted for so many years. Bond investors’ returns over time principally adhere to the coupon, or income returns. And with short-term rates finally some distance above zero, the prospects for income returns from shorter-term investments is becoming a reality. This development has and will expand the opportunity set for the Fund to invest capital on your and our behalf. One of those developments within the Fund has been the increase in duration to 3.8 years at the end of the third quarter, a more neutral level, from a lifetime portfolio low (low- to mid- 2-year range) that persisted for several years (2014 to 2016) during the zero interest-rate environment.
Our overall goal is to invest in a portfolio of bonds of varying maturities that we believe represents attractive risk- and tax-adjusted returns, taking into consideration the general level of interest rates and the credit quality of each investment. Our investments may be wide-ranging, but our analysis is the same. We strive to own only those investments we believe compensate us for the incremental credit risk we assume. Please see the following pages (or visit our website) for additional details regarding the breakdown of our investment holdings by state, sector and rating. While the vast majority of our Fund investments are Nebraska based, we select investments from a universe of over 55,000 issuers in the nearly $3 trillion municipal bond market.
We look forward to reporting to you on our progress in the quarters ahead and thank you for your patience and continued support.
The Fund seeks income that is exempt from federal and Nebraska personal income taxes, but income from the Fund may be subject to federal alternative minimum tax and capital gains taxes.
 
28  |  Q3 2018 SEMI-ANNUAL REPORT




                                 
Returns 
                               
 
Annualized
             
 
Since Inception
(10/01/1985)
 
20-year
 
10-year
 
5-year
 
3-year
 
1-year
 
YTD
 
Quarter
 
WNTFX 
4.47
%
2.98
%
2.31
%
0.86
%
0.12
%
(0.88
)%
(0.70
)%
(0.25
)%
5-Year Municipal Bond 
 
3.81
 
3.37
 
1.85
 
1.16
 
(0.60
)
0.10
 
(0.20
)
 
   
Five Largest Issuers 
 
 
Issuer 
% of Securities 
Nebraska Public Power District 
6.9 
Omaha Public Power District 
5.9 
Lincoln Electric System 
5.8 
Omaha Public Facilities Corp. 
5.8 
Nebraska Certificates of Participation 
5.4 
 
   
Financial Attributes 
 
 
Portfolio Summary 
 
Average Maturity(c) 
5.4 years 
Average Effective Maturity(c) 
4.2 years 
Average Duration(c) 
3.7 years 
Average Effective Duration(c) 
3.8 years 
Average Coupon(c) 
3.9% 
30-Day SEC Yield 
1.48% 
Municipals exempt from federal 
91.2% 
and Nebraska income taxes 
 
Municipals subject to alternative 
6.4% 
minimum tax 
 
 
   
Maturity Distribution(c) 
 
 
Maturity Type 
% of Portfolio 
Cash Equivalents 
(0.6) 
Less than 1 Year 
20.9 
1 - 3 Years 
20.9 
3 - 5 Years 
22.6 
5 - 7 Years 
8.0 
7 - 10 Years 
26.6 
10 Years or more 
1.6 
 
100.0 
 
   
Credit Quality(a)(c) 
 
 
Underlying Securities 
% of Portfolio 
Aaa/AAA 
2.3 
Aa/AA 
61.1 
A/A 
25.8 
Baa/BBB 
3.6 
Non-Rated 
7.8 
Cash Equivalents 
(0.6) 
 
100.0 
 
   
State Breakdown 
 
 
% of Net Assets 
Nebraska 
91.2 
Texas 
3.2 
Florida 
2.9 
District of Columbia 
1.1 
California 
0.4 
Washington 
0.4 
Colorado 
0.2 
Illinois 
0.2 
Cash Equivalents/Other 
0.4 
 
100.0 
 
   
Sector Breakdown 
 
 
% of Net Assets 
Power 
24.0 
Higher Education 
11.2 
Certificates of Participation 
7.5 
Airport/Transportation 
7.2 
Hospital 
6.8 
Lease 
6.2 
Water/Sewer 
3.8 
Housing 
2.0 
General 
1.2 
Total Revenue 
69.9 
School District 
9.5 
City/Subdivision 
6.8 
County 
2.8 
Natural Resource District 
1.1 
Total General Obligation 
20.2 
Escrow/Pre-Refunded 
9.5 
Cash Equivalents/Other 
0.4 
 
100.0 
 

(a) The Fund receives credit quality ratings on underlying securities of the Portfolio when available from credit rating agencies. The Fund will use one rating for an underlying security if that is all that is provided. Ratings and portfolio credit quality may change over time. The Fund itself has not been rated by an independent rating agency.
(b) Percent of net assets.
(c) Source: Bloomberg Analytics

Returns assume reinvestment of dividends and redemption at the end of each period, and reflect the deduction of the Fund’s annual operating expenses which as stated in its most recent prospectus are 0.85% of the Fund’s net assets. Total returns shown include fee waivers and expense reimbursements, if any; total returns would have been lower had there been no waivers and/or reimbursements. Past performance does not guarantee future results. The investment return and the principal value of an investment in this Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than the original cost. Current performance may be higher or lower than the performance data quoted. Performance data current to the most recent month-end may be obtained at www.weitzinvestments.com/funds_and_ performance/fund_ performance.fs.
See page 6 for additional performance disclosures. See page 70 for a description of all indices.
Performance information does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.
 
29  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
VALUE FUND
Schedule of Investments
 
September 30, 2018 
 
 
Common Stocks – 90.5% 
 
 
 
 
% of Net 
 
 
Communication Services  
Assets  
Shares  
$ Value 
       
Cable & Satellite  
15.9 
 
 
Liberty Broadband Corp. - Series C*  
650,000  
54,795,000 
Liberty Global plc - Class C* (c)  
950,000  
26,752,000 
Comcast Corp. - Class A  
620,000  
21,954,200 
Liberty SiriusXM Group - Series C*  
360,000  
15,642,000 
Charter Communications, Inc. - Class A*  
32,000  
10,428,160 
 
Interactive Media & Services  
8.6 
 
 
Alphabet, Inc. - Class C*  
38,000  
45,351,860 
Facebook, Inc. - Class A*  
150,000  
24,669,000 
 
Movies & Entertainment  
1.8 
 
 
Twenty-First Century Fox, Inc. - Class A  
325,000  
15,057,250 
 
26.3  
 
214,649,470 
Information Technology  
 
       
IT Services  
11.1 
 
 
Visa Inc. - Class A  
210,000  
31,518,900 
Mastercard Inc. - Class A  
140,000  
31,165,400 
Accenture plc - Class A(c)  
95,000  
16,169,000 
DXC Technology Co.  
130,000  
12,157,600 
 
Software  
4.5 
 
 
Oracle Corp.  
715,000  
36,865,400 
 
15.6  
 
127,876,300 
Financials 
 
 
 
 
Diversified Financial Services  
7.9 
 
 
Berkshire Hathaway Inc. - Class B*  
300,000  
64,233,000 
 
Insurance Brokers  
3.1 
 
 
Aon plc - Class A(c)  
165,000  
25,373,700 
 
Investment Banking & Brokerage  
2.0 
 
 
The Charles Schwab Corp.  
330,000  
16,219,500 
 
Diversified Banks  
1.9 
 
 
Wells Fargo & Co.  
295,000  
15,505,200 
 
14.9  
 
121,331,400 
Health Care  
 
 
 
 
Pharmaceuticals  
4.9 
 
 
Allergan plc(c)  
210,000  
40,000,800 
 
Health Care Services  
4.6 
 
 
Laboratory Corp. of America Holdings*  
215,000  
37,341,200 
 
Life Sciences Tools & Services  
3.1 
 
 
Thermo Fisher Scientific Inc.  
104,000  
25,384,320 
 
Health Care Equipment  
1.3 
 
 
Danaher Corp.  
100,000  
10,866,000 
 
13.9  
 
113,592,320 
Consumer Discretionary  
 
 
 
       
Multiline Retail  
3.2 
 
 
Dollar Tree, Inc.*  
325,000  
26,503,750 
 
Internet & Direct Marketing Retail  
3.1 
 
 
Amazon.com, Inc.*  
8,000  
16,024,000 
Booking Holdings Inc.*  
4,700  
9,324,800 
 
       
 
$ Principal 
 
 
% of Net  
Amount or  
 
 
Assets  
Shares  
$ Value 
       
Automotive Retail  
2.3 
 
 
CarMax, Inc.*  
255,000  
19,040,850 
       
Consumer Durables & Apparel  
2.0 
 
 
Mohawk Industries, Inc.*  
90,000  
15,781,500 
 
10.6  
 
86,674,900 
       
Materials  
 
 
 
       
Industrial Gases  
3.0 
 
 
Praxair, Inc.  
155,000  
24,913,150 
       
Construction Materials  
1.6 
 
 
Vulcan Materials Co.  
115,000  
12,788,000 
 
4.6  
 
37,701,150 
       
Consumer Staples  
 
 
 
       
Beverages  
2.0 
 
 
Diageo plc - Sponsored ADR(c)  
115,000  
16,292,050 
       
Industrials  
 
 
 
       
Aerospace & Defense  
1.4 
 
 
TransDigm Group, Inc.*  
30,000  
11,169,000 
       
Energy  
 
 
 
       
Oil & Gas Exploration & Production  
1.2 
 
 
Pioneer Natural Resources Co.  
58,000  
10,103,020 
Total Common Stocks (Cost $437,642,919)  
 
739,389,610 
 
 
 
 
Cash Equivalents – 9.9% 
 
 
 
 
U.S. Treasury Bills, 1.97% to 2.05%, 
 
 
 
10/04/18 to 11/15/18(a)  
72,300,000  
72,223,220 
     
State Street Institutional U.S. Government Money  
 
 
Market Fund - Premier Class 1.97%(b)  
8,525,103  
8,525,103 
Total Cash Equivalents (Cost $80,751,146)  
 
80,748,323 
Total Investments in Securities (Cost $518,394,065)  
820,137,933 
Other Liabilities in Excess of Other Assets - (0.4%)  
(2,831,683) 
Net Assets - 100%  
 
 
817,306,250 
Net Asset Value Per Share - Investor Class  
 
44.34 
Net Asset Value Per Share - Institutional Class  
 
44.79 
 
*     
Non-income producing
(a)     
Interest rates presented represent the yield to maturity at the date of purchase.
(b)     
Rate presented represents the annualized 7-day yield at September 30, 2018.
(c)     
Foreign domiciled entity
 
The accompanying notes form an integral part of these financial statements.
 
30  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
PARTNERS VALUE FUND
Schedule of Investments
September 30, 2018
 
Common Stocks – 87.8% 
 
 
 
 
% of Net  
 
 
Communication Services  
Assets  
Shares  
$ Value 
 
Cable & Satellite  
20.5 
 
 
Liberty Broadband Corp.*  
 
Series A  
155,000  
13,071,150 
Series C  
350,000  
29,505,000 
Liberty Global plc - Class C* (c)  
1,375,000  
38,720,000 
Liberty SiriusXM Group* 
 
 
 
Series A  
120,000  
5,212,800 
Series C  
450,000  
19,552,500 
Liberty Latin America Ltd. - Class C* (c)  
725,000  
14,956,750 
Comcast Corp. - Class A  
360,000  
12,747,600 
 
Interactive Media & Services  
7.8  
 
 
Alphabet, Inc. - Class C*  
26,000  
31,030,220 
Facebook, Inc. - Class A*  
120,000  
19,735,200 
 
Broadcasting  
2.0  
 
 
Discovery, Inc. - Class C*  
450,000  
13,311,000 
 
30.3  
 
197,842,220 
Information Technology  
 
 
IT Services  
11.9 
 
 
Visa Inc. - Class A  
200,000  
30,018,000 
Mastercard Inc. - Class A  
130,000  
28,939,300 
DXC Technology Co.  
200,000  
18,704,000 
 
Semiconductors & 
 
 
 
Semiconductor Equipment  
5.2 
 
 
Texas Instruments, Inc.  
190,000  
20,385,100 
Marvell Technology Group Ltd.(c)  
720,000  
13,896,000 
 
Software  
3.5  
 
 
Oracle Corp.  
445,000  
22,944,200 
 
20.6  
 
134,886,600 
Financials 
 
 
 
 
Diversified Financial Services  
5.9  
 
 
Berkshire Hathaway Inc. - Class B*  
180,000  
38,539,800 
 
Mortgage REITs  
3.3  
 
 
Redwood Trust, Inc.  
1,325,000  
21,518,000 
 
Insurance Brokers  
3.1  
 
 
Aon plc - Class A(c)  
132,500  
20,375,850 
 
Investment Banking & Brokerage  
2.3  
 
 
The Charles Schwab Corp.  
300,000  
14,745,000 
 
Diversified Banks  
1.8  
 
 
Wells Fargo & Co.  
225,000  
11,826,000 
 
16.4  
 
107,004,650 
Health Care  
 
 
 
Health Care Services  
4.7  
 
 
Laboratory Corp. of America Holdings*  
175,000  
30,394,000 
 
Pharmaceuticals  
3.8  
 
 
Allergan plc(c)  
130,000  
24,762,400 
 
8.5  
 
55,156,400 
Consumer Discretionary  
 
 
Internet & Direct Marketing Retail  
2.7 
 
 
Qurate Retail, Inc. - Series A*  
800,000  
17,768,000 
 
 
     
 
 
$ Principal  
 
 
% of Net  
Amount  
 
 
Assets  
or Shares  
$ Value 
 
     
Automotive Retail  
2.1 
 
 
CarMax, Inc.*  
180,000  
13,440,600 
 
4.8  
 
31,208,600 
Materials  
 
 
 
 
     
Specialty Chemicals  
2.0 
 
 
Axalta Coating Systems Ltd.* (c)  
450,000  
13,122,000 
       
Construction Materials  
1.9 
 
 
Summit Materials, Inc. - Class A*  
700,000  
12,726,000 
 
3.9  
 
25,848,000 
Industrials  
 
 
 
     
Machinery  
3.3 
 
 
Colfax Corp.*  
600,000  
21,636,000 
Total Common Stocks (Cost $347,589,395)  
 
573,582,470 
 
Cash Equivalents – 12.6%  
 
 
 
 
U.S. Treasury Bills, 1.97% to 2.25%, 
 
 
 
10/04/18 to 1/24/19(a)  
75,000,000  
74,782,216 
 
   
State Street Institutional U.S. Government Money 
 
 
Market Fund - Premier Class 1.97%(b)  
7,835,579  
7,835,579 
Total Cash Equivalents (Cost $82,620,180)  
 
82,617,795 
Total Investments in Securities (Cost $430,209,575)  
656,200,265 
Other Liabilities in Excess of Other Assets - (0.4%)  
(2,600,553) 
Net Assets - 100%  
 
 
653,599,712 
Net Asset Value Per Share - Investor Class  
 
32.32 
Net Asset Value Per Share - Institutional Class  
 
32.65 
 
*     
Non-income producing
(a)     
Interest rates presented represent the yield to maturity at the date of purchase.
(b)     
Rate presented represents the annualized 7-day yield at September 30, 2018.
(c)     
Foreign domiciled entity
 
The accompanying notes form an integral part of these financial statements.

31  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
PARTNERS III OPPORTUNITY FUND
Schedule of Investments
September 30, 2018
 
     
Common Stocks – 95.9% 
 
 
 
 
% of Net 
 
 
Communication Services  
Assets  
Shares  
$ Value 
 
Cable & Satellite  
24.1 
 
 
Liberty Broadband Corp.* (c) 
 
 
 
Series A  
135,000  
11,384,550 
Series C  
650,000  
54,795,000 
Liberty Global plc - Class C* (c) (d)  
1,650,000  
46,464,000 
Liberty SiriusXM Group* (c) 
 
 
 
Series A  
200,000  
8,688,000 
Series C  
400,000  
17,380,000 
GCI Liberty, Inc. - Class A* (c)  
200,000  
10,200,000 
Liberty Latin America Ltd. - Class C* (c) (d)  
400,000  
8,252,000 
 
Interactive Media & Services  
7.4 
 
 
Alphabet, Inc. - Class C* (c)  
27,000  
32,223,690 
Facebook, Inc. - Class A* (c)  
100,000  
16,446,000 
 
Movies & Entertainment  
1.8 
 
 
Liberty Formula One Group* (c) 
 
 
 
Series A  
50,000  
1,779,000 
Series C  
150,000  
5,578,500 
Liberty Braves Group* (c) 
 
 
 
Series A  
20,000  
545,600 
Series C  
140,000  
3,815,000 
 
Broadcasting  
0.9 
 
 
Discovery, Inc. - Class C* (c)  
200,000  
5,916,000 
 
34.2  
 
223,467,340 
Information Technology  
 
 
IT Services  
14.2 
 
 
Mastercard Inc. - Class A(c)  
165,000  
36,730,650 
Visa Inc. - Class A  
200,000  
30,018,000 
DXC Technology Co.  
200,000  
18,704,000 
Perspecta Inc.  
300,000  
7,716,000 
 
Semiconductors & 
 
 
 
Semiconductor Equipment  
4.6 
 
 
Texas Instruments, Inc.(c)  
170,000  
18,239,300 
Marvell Technology Group Ltd.(d)  
600,000  
11,580,000 
 
Application Software  
3.7  
 
 
Intelligent Systems Corp.* # †  
2,270,000  
23,993,900 
 
22.5  
 
146,981,850 
Financials 
 
 
 
 
Diversified Financial Services  
13.1 
 
 
Berkshire Hathaway Inc. - Class B* (c)  
400,000  
85,644,000 
 
Mortgage REITs  
2.7 
 
 
Redwood Trust, Inc.(c)  
1,100,000  
17,864,000 
 
Investment Banking & Brokerage  
1.1 
 
 
The Charles Schwab Corp.  
150,000  
7,372,500 
 
Property & Casualty Insurance  
1.1 
 
 
Markel Corp.* (c)  
6,000  
7,130,940 
 
18.0  
 
118,011,440 
Health Care  
 
 
 
Pharmaceuticals  
4.1 
 
 
Allergan plc (c) (d)  
140,000  
26,667,200 
 
Health Care Services  
3.4 
 
 
Laboratory Corp. of America Holdings* (c)  
130,000  
22,578,400 
 
7.5  
 
49,245,600 
Consumer Discretionary 
 
 
 
 
Internet & Direct Marketing Retail  
2.6 
 
 
Qurate Retail, Inc. - Series A* (c)  
550,000  
12,215,500 
Liberty Expedia Holdings, Inc. - Series A* (c)  
100,000  
4,704,000 
 
Automotive Retail  
2.3 
 
 
CarMax, Inc.*  
200,000  
14,934,000 
 
 
     
 
$ Principal  
 
 
% of Net  
Amount  
 
 
Assets  
or Shares  
$ Value 
       
Consumer Durables & Apparel  
1.3  
 
 
Tupperware Brands Corp.  
 
250,000  
8,362,500 
 
6.2  
 
40,216,000 
Industrials  
 
 
       
Machinery  
3.9 
 
 
Colfax Corp.* (c)  
 
700,000  
25,242,000 
       
Aerospace & Defense  
2.2  
 
 
Wesco Aircraft Holdings, Inc.* (c)  
1,300,000  
14,625,000 
 
6.1  
 
39,867,000 
Materials  
 
 
 
       
Construction Materials  
1.4 
 
 
Summit Materials, Inc. - Class A* (c)  
 
500,000  
9,090,000 
Total Common Stocks (Cost $340,551,540)  
 
 
626,879,230 
 
Cash Equivalents – 3.4%  
 
 
 
 
U.S. Treasury Bills, 1.97 to 2.00%, 
 
 
 
10/04/18 to 10/11/18(a)  
14,000,000  
13,993,654 
       
State Street Institutional U.S. Government Money  
 
 
 
Market Fund - Premier Class 1.97%(b)  
8,131,727  
8,131,727 
Total Cash Equivalents (Cost $22,125,604)  
 
 
22,125,381 
Total Investments in Securities (Cost $362,677,144)  
 
649,004,611 
 
Due From Broker(c) - 30.8%  
201,100,310 
Securities Sold Short - (29.8%)  
(194,474,000) 
Options Written - (0.1%)  
(723,500) 
Other Liabilities in Excess of Other Assets - (0.2%)  
(1,296,717) 
Net Assets - 100%  
 
 
653,610,704 
Net Asset Value Per Share - Investor Class  
 
14.08 
Net Asset Value Per Share - Institutional Class  
 
14.55 
 
Securities Sold Short – (29.8%) 
 
 
 
 
Invesco QQQ Trust, Series 1  
 
280,000  
(52,021,200) 
SPDR S&P 500 ETF Trust  
 
490,000  
(142,452,800) 
Total Securities Sold Short (proceeds $132,695,166)  
(194,474,000) 
 
Options Written* – (0.1%)  
 
 
 
 
Shares 
 
 
subject 
 
 
$ Notional  
to option  
 
       
Covered Call Options 
 
 
 
Discovery, Inc. - Class C, Dec. 2018/ $27.50  
2,750,000  
100,000  
(310,000) 
Discovery, Inc. - Class C, Dec. 2018/ $30 
3,000,000  
100,000  
(161,000) 
Summit Materials, Inc - Class A, Nov. 2018 / $22.50  
2,250,000  
100,000  
(20,000) 
       
Put Options 
 
 
 
Summit Materials, Inc - Class A, Nov. 2018 / $20  
2,000,000  
100,000  
(232,500) 
Total Options Written (premiums received $549,466)  
 
(723,500) 
 
*     
Non-income producing
     
Controlled affiliate
#     
Illiquid and/or restricted security.
(a)     
Interest rates presented represent the yield to maturity at the date of purchase.
(b)     
Rate presented represents the annualized 7-day yield at September 30, 2018.
(c)     
Fully or partially pledged as collateral on securities sold short and outstanding written options.
(d)     
Foreign domiciled entity
 
The accompanying notes form an integral part of these financial statements. 
 
32  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
 
 
HICKORY FUND 
Schedule of Investments 
September 30, 2018 
 
 
     
Common Stocks – 83.2% 
 
 
 
 
% of Net 
 
 
Communication Services  
Assets  
Shares  
$ Value 
 
Cable & Satellite  
23.2 
 
 
Liberty Broadband Corp.* 
 
 
 
Series A  
50,000  
4,216,500 
Series C  
190,000  
16,017,000 
Liberty SiriusXM Group* 
 
 
 
Series A  
50,000  
2,172,000 
Series C  
180,000  
7,821,000 
GCI Liberty, Inc. - Class A*  
185,000  
9,435,000 
Liberty Latin America Ltd. - Class C* (c)  
380,000  
7,839,400 
Liberty Global plc - Class C* (c)  
250,000  
7,040,000 
 
Movies & Entertainment  
6.5 
 
 
Lions Gate Entertainment Corp.(c) 
 
 
 
Class A  
125,000  
3,048,750 
Class B  
150,000  
3,495,000 
Liberty Formula One Group* 
 
 
 
Series A  
27,500  
978,450 
Series C  
125,000  
4,648,750 
Liberty Braves Group* 
 
 
 
Series A  
11,000  
300,080 
Series C  
105,000  
2,861,250 
 
Diversified Telecommunication Services 6.2 
 
 
LICT Corp.* #  
995  
14,601,625 
 
35.9  
 
84,474,805 
Consumer Discretionary  
 
 
Internet & Direct Marketing Retail  
5.8 
 
 
Qurate Retail, Inc. - Series A*  
350,000  
7,773,500 
Liberty Expedia Holdings, Inc. - Series A*  
125,000  
5,880,000 
 
Consumer Durables & Apparel  
2.8 
 
 
Tupperware Brands Corp.  
195,000  
6,522,750 
 
Automotive Retail  
1.1 
 
 
Murphy USA Inc.*  
30,000  
2,563,800 
 
9.7  
 
22,740,050 
Materials  
 
 
 
 
Metals & Mining  
3.4 
 
 
Compass Minerals International, Inc.  
120,000  
8,064,000 
 
Specialty Chemicals  
3.1 
 
 
Axalta Coating Systems Ltd.* (c)  
250,000  
7,290,000 
 
Construction Materials  
2.7 
 
 
Summit Materials, Inc. - Class A*  
350,000  
6,363,000 
 
9.2  
 
21,717,000 
Industrials  
 
 
 
Machinery  
4.9 
 
 
Colfax Corp.*  
320,000  
11,539,200 
 
Aerospace & Defense  
2.4 
 
 
Wesco Aircraft Holdings, Inc.*  
500,000  
5,625,000 
 
Building Products  
1.1 
 
 
Fortune Brands Home & Security, Inc.  
50,000  
2,618,000 
 
8.4  
 
19,782,200 
 
 
$ Principal 
 
 
% of Net  
Amount 
 
Information Technology  
Assets  
or Shares  
$ Value 
 
     
Software  
6.6 
 
 
ACI Worldwide, Inc.*  
375,000  
10,552,500 
Guidewire Software, Inc.*  
50,000  
5,050,500 
 
     
IT Services  
0.9 
 
 
Perspecta Inc.  
85,000  
2,186,200 
 
7.5  
 
17,789,200 
Health Care  
 
 
 
     
Health Care Services  
4.7 
 
 
Laboratory Corp. of America Holdings*  
63,000  
10,941,840 
       
Financials 
 
 
 
 
     
Mortgage REITs  
4.4 
 
 
Redwood Trust, Inc.  
635,000  
10,312,400 
 
   
Real Estate  
 
 
 
     
Equity REITs  
3.4 
 
 
Equity Commonwealth*  
250,000  
8,022,500 
Total Common Stocks (Cost $117,714,539)  
 
195,779,995 
 
 
 
Cash Equivalents – 17.0%  
 
 
 
 
U.S. Treasury Bills, 1.97% to 2.20%, 
 
 
 
10/04/18 to 1/24/19(a)  
38,000,000  
37,886,340 
 
   
State Street Institutional U.S. Government Money 
 
 
Market Fund - Premier Class 1.97(b)  
2,101,945  
2,101,945 
Total Cash Equivalents (Cost $39,991,631)  
 
39,988,285 
Total Investments in Securities (Cost $157,706,170)  
235,768,280 
Other Liabilities in Excess of Other Assets - (0.2%)  
(496,136) 
Net Assets - 100%  
 
 
235,272,144 
Net Asset Value Per Share  
 
51.24 
 
*     
Non-income producing
#     
Illiquid and/or restricted security
(a)     
Interest rates presented represent the yield to maturity at the date of purchase.
(b)     
Rate presented represents the annualized 7-day yield at September 30, 2018.
(c)     
Foreign domiciled entity
 
The accompanying notes form an integral part of these financial statements.

33  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
BALANCED FUND
Schedule of Investments
September 30, 2018
 
     
Common Stocks – 46.6% 
 
 
 
 
% of Net 
 
 
Information Technology  
Assets  
Shares  
$ Value 
 
IT Services  
5.2 
 
 
Visa Inc. - Class A  
17,000  
2,551,530 
Mastercard Inc. - Class A  
11,000  
2,448,710 
Accenture plc - Class A(e)  
8,000  
1,361,600 
 
Software  
5.0 
 
 
Oracle Corp.  
47,500  
2,449,100 
Guidewire Software, Inc.*  
20,000  
2,020,200 
Microsoft Corp.  
15,000  
1,715,550 
 
Semiconductors & 
 
 
 
Semiconductor Equipment  
2.1 
 
 
Marvell Technology Group Ltd.(e)  
70,000  
1,351,000 
Texas Instruments, Inc.  
11,000  
1,180,190 
 
12.3  
 
15,077,880 
Financials 
 
 
 
 
Diversified Financial Services  
2.4 
 
 
Berkshire Hathaway Inc. - Class B*  
14,000  
2,997,540 
 
Insurance Brokers  
1.5 
 
 
Aon plc - Class A(e)  
12,000  
1,845,360 
 
Mortgage REITs  
1.5 
 
 
Redwood Trust, Inc.  
110,000  
1,786,400 
 
Investment Banking & Brokerage  
1.3 
 
 
The Charles Schwab Corp.  
33,000  
1,621,950 
 
Diversified Banks  
1.2 
 
 
JPMorgan Chase & Co.  
12,500  
1,410,500 
 
7.9  
 
9,661,750 
Health Care  
 
 
 
Health Care Services  
2.1 
 
 
Laboratory Corp. of America Holdings*  
15,000  
2,605,200 
 
Life Sciences Tools & Services  
2.1 
 
 
Thermo Fisher Scientific Inc.  
10,500  
2,562,840 
 
Pharmaceuticals  
2.0 
 
 
Allergan plc(e)  
13,000  
2,476,240 
 
Health Care Equipment  
1.4 
 
 
Danaher Corp.  
15,000  
1,629,900 
 
7.6  
 
9,274,180 
Materials  
 
 
 
 
Construction Materials  
2.4 
 
 
Vulcan Materials Co.  
14,000  
1,556,800 
Martin Marietta Materials, Inc.  
7,500  
1,364,625 
 
Industrial Gases  
2.0 
 
 
Praxair, Inc.  
15,000  
2,410,950 
 
Metals & Mining  
1.2 
 
 
Compass Minerals International, Inc.  
23,000  
1,545,600 
 
Specialty Chemicals  
1.0 
 
 
Axalta Coating Systems Ltd.* (e)  
42,500  
1,239,300 
 
6.6  
 
8,117,275 
Communication Services  
 
 
 
 
Cable & Satellite  
4.1 
 
 
Liberty Broadband Corp. - Series C*  
32,500  
2,739,750 
Comcast Corp. - Class A  
65,000  
2,301,650 
 
Interactive Media & Services  
2.1  
 
 
Alphabet, Inc. - Class C*  
2,200  
2,625,634 
 
6.2  
 
7,667,034 
 
 
     
 
$ Principal 
 
 
% of Net  
Amount  
 
Consumer Staples  
Assets  
or Shares  
$ Value 
 
Beverages  
2.9 
 
 
Diageo plc - Sponsored ADR(e)  
15,000  
2,125,050 
Anheuser-Busch InBev SA/NV - Sponsored ADR(e)  
17,000  
1,488,690 
 
Food Products  
1.1 
 
 
Mondelez International, Inc. - Class A  
30,000  
1,288,800 
 
4.0  
 
4,902,540 
Consumer Discretionary  
 
 
Consumer Durables & Apparel  
1.0 
 
 
Mohawk Industries, Inc.*  
7,000  
1,227,450 
 
Multiline Retail  
1.0  
 
 
Dollar Tree, Inc.*  
15,000  
1,223,250 
 
2.0  
 
2,450,700 
Total Common Stocks (Cost $39,349,159)  
 
57,151,359 
 
Corporate Bonds – 19.5%  
 
 
 
 
American Express Credit Corp. 8.125% 5/20/19  
500,000  
516,858 
Apple Inc. 1.55% 2/08/19  
1,000,000  
996,971 
Bank of America Corp. 
 
 
 
2.6% 1/15/19  
1,250,000  
1,249,862 
2.25% 4/21/20  
1,000,000  
986,884 
Berkshire Hathaway Inc. (Finance Corp.) 
 
 
 
1.7% 3/15/19  
800,000  
797,308 
4.25% 1/15/21  
300,000  
307,751 
Broadcom Corp. 2.2% 1/15/21  
1,000,000  
969,400 
Capital One Bank USA, N.A. 
 
 
 
2.3% 6/05/19  
250,000  
249,166 
8.8% 7/15/19  
500,000  
522,832 
Capital One Financial Corp. 2.45% 4/24/19  
718,000  
716,999 
Capital One N.A. 2.4% 9/05/19  
350,000  
348,190 
Discovery, Inc. 2.2% 9/20/19  
1,000,000  
992,428 
Equity Commonwealth 5.875% 9/15/20  
700,000  
720,026 
First Republic Bank 2.375% 6/17/19  
1,200,000  
1,196,912 
Fortive Corp. 1.8% 6/15/19  
500,000  
495,326 
Goldman Sachs Group, Inc. 2.6% 12/27/20  
500,000  
492,215 
JPMorgan Chase & Co. 
 
 
 
6.3% 4/23/19  
270,000  
275,372 
2.87713% 3/09/21 Floating Rate (Qtrly LIBOR + 55)  
750,000  
752,305 
The Manitowoc Co., Inc. 12.75% 8/15/21(d)  
500,000  
548,750 
Markel Corp. 
 
 
 
7.125% 9/30/19  
1,014,000  
1,049,595 
4.9% 7/01/22  
410,000  
422,450 
3.625% 3/30/23  
500,000  
490,982 
Marriott International, Inc. 3.0% 3/01/19  
830,000  
830,047 
Moody’s Corp. 2.75% 7/15/19  
559,000  
558,915 
QVC, Inc. 3.125% 4/01/19  
500,000  
500,080 
Roper Technologies, Inc. 2.05% 10/01/18  
1,000,000  
1,000,000 
Unilever United States, Inc. 2.2% 3/06/19  
650,000  
649,058 
U.S. Bancorp 
 
 
 
1.95% 11/15/18  
250,000  
249,852 
2.35% 1/29/21  
1,000,000  
981,110 
Wells Fargo & Co. 
 
 
 
2.15% 1/15/19  
1,000,000  
998,924 
2.125% 4/22/19  
800,000  
797,539 
4.6% 4/01/21  
1,250,000  
1,285,783 
WM. Wrigley Jr. Co. 2.4% 10/21/18(d)  
1,000,000  
999,920 
Total Corporate Bonds (Cost $24,132,737)  
 
23,949,810 
 
The accompanying notes form an integral part of these financial statements.
 
34  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
 
   
Corporate Convertible Bonds – 0.8% 
 
 
 
$ Principal 
 
 
Amount  
$ Value 
 
Redwood Trust, Inc. 5.625% 11/15/19 (Cost $998,747)  
1,000,000  
1,014,240 
 
Asset-Backed Securities - 1.3%(c) 
 
 
 
Ascentium Equipment Receivables Trust (ACER)(d) 
 
 
2018-1A CL A1 — 2.5% 2019 (0.2 years)  
388,958  
388,982 
Drive Auto Receivables Trust (DRIVE) 
 
 
2018-4 CL A3 — 3.04% 2021 (0.9 years)  
500,000  
500,121 
Flagship Credit Auto Trust (FCAT)(d) 
 
 
2014-2 CL C — 3.95% 2020 (0.4 years)  
250,000  
251,037 
SoFi Consumer Loan Program LLC (SCLP)(d) 
 
 
2017-6 CL A1 — 2.2% 2026 (0.5 years)  
427,954  
425,567 
Total Asset-Backed Securities (Cost $1,566,291)  
 
1,565,707 
 
Mortgage-Backed Securities – 2.2%(c) 
 
 
Federal Home Loan Mortgage Corporation  
 
Collateralized Mortgage Obligations  
 
 
3649 CL BW — 4.0% 2025 (2.3 years)  
63,201  
63,553 
 
Pass-Through Securities 
 
 
J14649 — 3.5% 2026 (2.8 years)  
101,543  
102,186 
E02948 — 3.5% 2026 (2.9 years)  
160,700  
161,716 
J16663 — 3.5% 2026 (2.9 years)  
99,481  
100,109 
 
427,564 
Federal National Mortgage Association 
 
 
 
Pass-Through Securities 
 
 
MA0464 — 3.5% 2020 (0.7 years)  
36,471  
36,691 
AR8198 — 2.5% 2023 (1.8 years)  
130,103  
128,713 
MA1502 — 2.5% 2023 (1.9 years)  
109,872  
108,699 
995755 — 4.5% 2024 (2.1 years)  
14,726  
15,281 
AB1769 — 3.0% 2025 (2.8 years)  
90,368  
89,839 
AB3902 — 3.0% 2026 (3.1 years)  
160,327  
159,388 
AK3264 — 3.0% 2027 (3.2 years)  
128,776  
128,022 
 
666,633 
Government National Mortgage Association  
 
 
 
Pass-Through Securities 
 
 
G2 5255 — 3.0% 2026 (3.1 years)  
165,391  
164,271 
 
Non-Government Agency 
 
 
 
Collateralized Mortgage Obligations  
 
 
J.P. Morgan Mortgage Trust (JPMMT)(d) (f) 
 
 
2014-5 CL A1 — 2.9878% 2029 (4.3 years)  
224,582  
220,577 
2017-3 CL 2A2 — 2.5% 2047 (4.7 years)  
831,871  
798,251 
Sequoia Mortgage Trust (SEMT)(f) 
 
 
2012-1 CL 1A1 — 2.865% 2042 (1.5 years)  
19,259  
19,405 
2017-CH1 CL A11 — 3.5% 2047 (2.6 years)(d)  
375,427  
374,382 
 
1,412,615 
Total Mortgage-Backed Securities (Cost $2,716,860)  
2,671,083 
 
     
U.S. Treasury – 28.7%  
$ Principal 
 
 
Amount 
 
 
or Shares  
$ Value 
 
U.S. Treasury Notes 
 
 
1.125% 1/31/19  
1,000,000  
996,087 
1.625% 3/31/19  
1,000,000  
996,191 
1.25% 4/30/19  
1,000,000  
993,262 
1.625% 7/31/19  
1,000,000  
992,109 
1.625% 8/31/19  
1,000,000  
991,074 
1.5% 10/31/19  
1,000,000  
987,578 
1.375% 12/15/19  
1,000,000  
984,492 
1.25% 1/31/20  
1,000,000  
980,781 
1.375% 2/15/20  
1,000,000  
981,797 
1.375% 4/30/20  
1,000,000  
978,496 
1.5% 5/15/20  
1,000,000  
979,883 
1.5% 6/15/20  
1,000,000  
978,750 
1.375% 8/31/20  
1,000,000  
973,359 
2.0% 9/30/20  
1,000,000  
984,160 
2.0% 11/30/20  
2,000,000  
1,964,883 
2.0% 2/28/21  
1,000,000  
980,176 
2.375% 4/15/21  
1,000,000  
988,164 
1.375% 5/31/21  
1,000,000  
962,012 
2.625% 6/15/21  
1,000,000  
993,633 
1.125% 8/31/21  
1,000,000  
951,270 
1.875% 11/30/21  
2,000,000  
1,939,336 
1.75% 2/28/22  
1,000,000  
962,793 
1.875% 4/30/22  
1,000,000  
965,039 
2.125% 6/30/22  
2,000,000  
1,944,141 
2.0% 7/31/22  
1,000,000  
966,914 
1.875% 8/31/22  
1,000,000  
961,387 
2.0% 11/30/22  
1,000,000  
963,691 
2.0% 2/15/23  
1,000,000  
961,816 
2.5% 3/31/23  
1,000,000  
981,680 
1.625% 5/31/23  
2,000,000  
1,886,289 
2.5% 8/15/23  
2,000,000  
1,959,961 
Total U.S. Treasury (Cost $35,652,055)  
 
35,131,204 
 
Cash Equivalents – 0.8% 
 
 
 
U.S. Treasury Bill 1.97% 10/04/18(a)  
700,000  
699,882 
 
State Street Institutional U.S. Government Money 
 
 
Market Fund - Premier Class 1.97%(b)  
322,113  
322,113 
Total Cash Equivalents (Cost $1,022,000)  
 
1,021,995 
Total Investments in Securities (Cost $105,437,849)  
122,505,398 
Other Assets Less Other Liabilities — 0.1%  
73,446 
Net Assets - 100%  
 
122,578,844 
Net Asset Value Per Share  
14.06 
 
*     
Non-income producing
(a)     
Interest rate presented represents the yield to maturity at the date of purchase.
(b)     
Rate presented represents the annualized 7-day yield at September 30, 2018.
(c)     
Number of years indicated represents estimated average life.
(d) Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers.
(e) Foreign domiciled entity
(f) The interest rate resets periodically based on the weighted average coupons of the underlying mortgage-related or asset-backed obligations.
 
The accompanying notes form an integral part of these financial statements.
 
35  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
CORE PLUS INCOME FUND
Schedule of Investments
September 30, 2018
 
   
Corporate Bonds – 23.9% 
 
 
 
$ Principal 
 
 
Amount  
$ Value 
 
Andeavor Logistics LP 6.25% 10/15/22  
1,000,000  
1,028,750 
Anheuser-Busch InBev Finance Inc. 3.3% 2/01/23  
200,000  
197,645 
Bank of America Corp. 2.25% 4/21/20  
300,000  
296,065 
Berkshire Hathaway Inc. Finance Corp. 3.0% 5/15/22  
200,000  
198,777 
Boardwalk Pipelines LLC 5.75% 9/15/19  
225,000  
230,552 
Boston Properties LP 3.125% 9/01/23  
555,000  
540,107 
Broadcom Corp. 3.125% 1/15/25  
350,000  
325,489 
Calumet Specialty Products Partners LP  
 
 
6.5% 4/15/21  
350,000  
350,000 
7.625% 1/15/22  
357,000  
359,677 
Charter Communications Operating, LLC 4.2% 3/15/28  
400,000  
383,157 
CNX Resources Corp. 5.875% 4/15/22  
92,000  
92,350 
Computer Sciences Corp. 4.45% 9/15/22  
500,000  
507,727 
Discovery, Inc. 2.95% 3/20/23  
400,000  
383,550 
Dominion Resources, Inc. 2.962% 7/01/19  
100,000  
99,972 
Donnelley Financial Solutions, Inc. 8.25% 10/15/24  
108,000  
114,277 
Equifax Inc. 2.3% 6/01/21  
100,000  
96,499 
Equity Commonwealth 5.875% 9/15/20  
1,319,000  
1,356,735 
FLIR Systems, Inc. 3.125% 6/15/21  
400,000  
393,801 
Invista B.V. 4.25% 10/15/19(c)  
150,000  
150,517 
iStar Inc. 5.0% 7/01/19  
161,000  
161,370 
JPMorgan Chase & Co. 2.87713% 3/09/21 
 
 
Floating Rate (Qtrly LIBOR + 55)  
150,000  
150,461 
L Brands, Inc. 5.625% 2/15/22  
40,000  
40,612 
The Manitowoc Co., Inc. 12.75% 8/15/21(c)  
550,000  
603,625 
Markel Corp. 
 
 
7.125% 9/30/19  
125,000  
129,388 
4.9% 7/01/22  
250,000  
257,592 
3.625% 3/30/23  
200,000  
196,393 
3.5% 11/01/27  
550,000  
512,944 
MPLX LP 4.875% 6/01/25  
190,000  
196,500 
NGL Energy Partners LP 
 
 
5.125% 7/15/19  
565,000  
569,944 
7.5% 11/01/23  
148,000  
149,480 
NXP BV 4.625% 6/01/23(c) (d)  
100,000  
101,770 
QVC, Inc. 3.125% 4/01/19  
100,000  
100,016 
Range Resources Corp. 5.0% 8/15/22  
301,000  
299,495 
RELX plc 3.5% 3/16/23  
770,000  
760,773 
Sprint Spectrum Co. LLC 3.36% 3/20/23(c) (e)  
187,500  
187,266 
STORE Capital Corp. 4.5% 3/15/28  
503,000  
491,495 
TC PipeLines LP 4.65% 6/15/21  
160,000  
162,850 
Wells Fargo & Co. 
 
 
4.6% 4/01/21  
400,000  
411,451 
2.1% 7/26/21  
200,000  
192,649 
Total Corporate Bonds (Cost $12,797,901)  
 
12,781,721 
 
Corporate Convertible Bonds – 1.8% 
 
 
 
Redwood Trust, Inc. 
 
 
5.625% 11/15/19  
150,000  
152,136 
4.75% 8/15/23  
350,000  
335,799 
5.625% 7/15/24  
500,000  
494,687 
Total Corporate Convertible Bonds (Cost $997,406)  
982,622 
 
     
Asset-Backed Securities – 25.4%(b)  
 
 
 
$ Principal 
 
 
Amount  
$ Value 
 
AmeriCredit Automobile Receivables Trust (AMCAR)  
 
 
2015-2 CL D — 3.0% 2021 (0.9 years)  
110,000  
110,013 
2017-1 CL D — 3.13% 2023 (2.2 years)  
69,000  
68,073 
Ascentium Equipment Receivables Trust (ACER)(c)  
 
 
2015-2A CL B — 2.62% 2019 (0.1 years)  
32,953  
32,950 
2016-2A CL E — 6.79% 2024 (2.0 years)  
422,000  
439,099 
CarMax Auto Owner Trust (CARMX) 
 
 
2017-2 CL B — 2.41% 2022 (2.9 years)  
90,000  
87,780 
Chrysler Capital Auto Receivables Trust (CCART)(c)  
 
 
2014-BA CL D — 3.44% 2021 (0.2 years)  
108,000  
108,134 
Conn Funding II, LP (CONN)(c) 
 
 
2017-B CL A — 2.73% 2020 (0.1 years)  
53,561  
53,555 
Credit Acceptance Auto Loan Trust (CAALT)(c) 
 
 
2015-2A CL C — 3.76% 2024 (0.2 years)  
250,000  
250,249 
2016-2A CL C — 4.29% 2024 (0.9 years)  
260,000  
261,982 
2016-3A CL B — 2.94% 2024 (1.2 years)  
427,000  
424,566 
Drive Auto Receivables Trust (DRIVE)  
 
 
2017-AA CL D — 4.16% 2024 (1.6 years)(c)  
290,000  
293,007 
2018-1 CL D — 3.81% 2024 (1.7years)  
590,000  
587,909 
DT Auto Owner Trust (DTAOT)(c) 
 
 
2016-1A CL C — 3.54% 2021 (0.1 years)  
42,986  
43,023 
2017-2A CL B — 2.44% 2021 (0.2 years)  
168,207  
168,047 
2016-3A CL C — 3.15% 2022 (0.2 years)  
65,143  
65,184 
2017-4A CL C — 2.86% 2023 (0.8 years)  
140,000  
139,421 
2018-1A CL B — 3.04% 2022 (0.9 years)  
300,000  
299,392 
2016-4A CL D — 3.77% 2022 (1.1 years)  
85,000  
85,480 
Enterprise Fleet Financing LLC (EFF)(c)  
 
 
2017-2 CL A2 — 1.97% 2023 (0.7 years)  
285,231  
283,306 
Exeter Automobile Receivables Trust (EART)(c) 
 
 
2016-3A CL A — 1.84% 2020 (0.1 years)  
13,494  
13,480 
2018-2A CL A — 2.79% 2021 (0.4 years)  
165,012  
164,893 
2017-3A CL A — 2.05% 2021 (0.4 years)  
169,239  
168,460 
2016-3A CL B — 2.84% 2021 (0.6 years)  
368,000  
368,101 
2017-2A CL B — 2.82% 2022 (0.9 years)  
160,000  
159,164 
2016-2A CL C — 5.96% 2022 (1.0 years)  
480,000  
492,007 
2017-1A CL C — 3.95% 2022 (1.5 years)  
310,000  
310,584 
2017-3A CL C — 3.68% 2023 (2.0 years)  
88,000  
87,693 
First Investors Auto Owners Trust (FIAOT)(c)  
2015-2A CL D — 4.22% 2021 (1.3 years)  
287,000  
289,141 
2017-1A CL B — 2.67% 2023 (1.5 years)  
187,000  
184,975 
2016-2A CL C — 2.53% 2022 (1.6 years)  
116,000  
113,898 
Flagship Credit Auto Trust (FCAT)(c)  
 
2014-2 CL C — 3.95% 2020 (0.4 years)  
460,000  
461,908 
2015-2 CL B — 3.08% 2021 (0.4 years)  
315,000  
315,048 
Hertz Fleet Lease Funding LP (HFLF)(c)  
 
 
2018-1 CL A2 — 3.23% 2032 (1.6 years)  
370,000  
369,840 
Honor Automobile Trust Securitization (HATS)(c)  
2016-1A CL A — 2.94% 2019 (0.1 years)  
14,425  
14,425 
Marlette Funding Trust (MFT)(c)  
 
2016-1A CL B — 4.78% 2023 (0.2 years)  
412,378  
414,554 
2017-1A CL A — 2.827% 2024 (0.2 years)  
65,568  
65,569 
2016-1A CL C — 9.09% 2023 (0.5 years)  
100,000  
103,690 
2017-1A CL B — 4.114% 2024 (0.7 years)  
350,000  
351,338 
2018-2A CL A — 3.06% 2028 (0.8 years)  
136,756  
136,732 
2018-3A CL A — 3.2% 2028 (0.9 years)  
372,148  
372,159 
OneMain Direct Auto Receivables Trust (ODART)(c)  
2017-1A CL B — 2.88% 2021 (0.7 years)  
200,000  
198,947 
2017-2A CL D — 3.42% 2024 (2.3 years)  
100,000  
98,532 
OneMain Financial Issuance Trust (OMFIT)(c)  
2015-2A CL C — 4.32% 2025 (0.0 years)  
200,000  
200,861 
2015-1A CL A — 3.19% 2026 (0.0 years)  
90,288  
90,515 
2015-1A CL D — 6.63% 2026 (0.0 years)  
400,000  
408,489 
2015-2A CL D — 5.64% 2025 (1.4 years)  
280,000  
282,459 
2016-2A CL C — 5.67% 2028 (1.5 years)  
510,000  
519,490 
 
The accompanying notes form an integral part of these financial statements.
 
36  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
 
 
   
 
$ Principal 
 
 
Amount  
$ Value 
 
Santander Drive Auto Receivables Trust (SDART) 
 
 
2016-3 CL B — 1.89% 2021 (0.3 years)  
253,873  
253,187 
2015-5 CL C — 2.74% 2021 (0.3 years)  
111,616  
111,607 
2014-5 CL D — 3.21% 2021 (0.5 years)  
80,000  
80,163 
2017-1 CL C — 2.58% 2022 (0.9 years)  
131,000  
130,169 
2015-5 CL D — 3.65% 2021 (1.1 years)  
245,000  
246,010 
2015-4 CL D — 3.53% 2021 (1.1 years)  
100,000  
100,330 
2016-3 CL D — 2.8% 2022 (1.9 years)  
400,000  
395,714 
SoFi Consumer Loan Program LLC (SCLP)(c) 
 
 
2016-2 CL A — 3.09% 2025 (0.9 years)  
266,258  
265,791 
2016-3 CL A — 3.05% 2025 (0.9 years)  
73,004  
72,708 
2017-1 CL A — 3.28% 2026 (1.2 years)  
42,792  
42,748 
Springleaf Funding Trust (SLFT)(c) 
 
 
2015-AA CL C — 5.04% 2024 (0.0 years)  
200,000  
199,301 
2015-AA CL A — 3.16% 2024 (0.4 years)  
84,493  
84,505 
Upstart Securitization Trust (UPST)(c)  
 
 
2018-1 CL A — 3.015% 2025 (0.3 years)  
222,968  
222,972 
2017-2 CL C — 5.59% 2025 (2.2 years)  
500,000  
506,335 
Westlake Automobile Receivables Trust (WLAKE)(c)  
 
 
2017-1A CL C — 2.7% 2022 (0.8 years)  
117,000  
116,651 
2018-1A CL C — 2.92% 2023 (1.4 years)  
188,000  
186,370 
Total Asset-Backed Securities (Cost $13,575,123)  
 
13,572,683 
 
Commercial Mortgage-Backed Securities – 1.8%(b) 
 
 
TPG Real Estate Finance (TRTX)(c) (d) 
 
 
2018-FL1 CL AS — 3.01% 2035 Floating Rate 
 
 
(Mthly LIBOR + 95) (1.1 years)  
400,000  
400,893 
VMC Finance LLC (VMC)(c) 
 
 
(Mthly LIBOR + 120) (1.6 years)  
400,000  
401,251 
VSD LLC (VSD)(c) 
 
 
2017-PLT1 CL A — 3.6% 2043 (0.3 years)  
154,804  
154,762 
Total Commercial Mortgage-Backed Securities (Cost $954,804)  
956,906 
 
Mortgage-Backed Securities – 3.2%(b) 
 
 
 
Federal National Mortgage Association 
 
 
 
Pass-Through Securities 
 
 
932836 — 3.0% 2025 (2.8 years)  
76,842  
76,393 
 
Non-Government Agency  
 
 
Collateralized Mortgage Obligations 
 
 
COLT Funding LLC (COLT)(c) (f) 
 
 
2017-2 CL A1A — 2.415% 2047 (1.5 years)  
221,603  
220,647 
Flagstar Mortgage Trust (FSMT)(c) (f)  
 
 
2017-1 CL 2A2 — 3.0% 2047 (3.4 years)  
290,192  
284,891 
J.P. Morgan Mortgage Trust (JPMMT)(c) (f) 
 
 
2017-3 CL 2A2 — 2.5% 2047 (4.7 years)  
291,155  
279,388 
2016-3 CL 2A1 — 3.0% 2046 (5.4 years)  
289,206  
283,765 
2018-6 CL 2A2 — 3.0% 2048 (5.4 years)  
291,573  
290,958 
Sequoia Mortgage Trust (SEMT)(c) (f)  
 
 
2017-CH1 CL A11 — 3.5% 2047 (2.6 years)  
300,342  
299,506 
 
1,659,155 
Total Mortgage-Backed Securities (Cost $1,765,491)  
1,735,548 
 
 
   
Taxable Municipal Bonds – 0.8%  
$ Principal 
 
 
Amount 
 
 
or Shares  
$ Value 
 
Alderwood Water and Wastewater District, Washington, Water 
 
& Sewer Revenue, Series B, 5.15% 12/01/25 (Cost $413,904) 
400,000  
412,820 
 
U.S. Treasury – 39.6% 
 
 
 
U.S. Treasury Notes/Bonds 
 
 
2.75% 11/15/23  
710,000  
703,413 
2.5% 5/15/24  
1,000,000  
975,664 
2.0% 5/31/24  
1,600,000  
1,519,188 
2.0% 2/15/25  
970,000  
913,827 
2.125% 5/15/25  
2,500,000  
2,368,262 
2.25% 11/15/25  
3,500,000  
3,327,871 
1.625% 5/15/26  
1,500,000  
1,357,441 
1.5% 8/15/26  
850,000  
759,157 
2.0% 11/15/26  
1,650,000  
1,527,217 
2.25% 2/15/27  
1,875,000  
1,765,503 
2.375% 5/15/27  
2,000,000  
1,899,453 
2.75% 2/15/28  
2,250,000  
2,194,717 
2.5% 5/15/46  
2,100,000  
1,830,855 
Total U.S. Treasury (Cost $21,878,004)  
 
21,142,568 
 
Common Stocks – 0.5% 
 
 
 
Redwood Trust, Inc. (Cost $192,471)  
14,850  
241,164 
 
Cash Equivalents – 2.4% 
 
 
 
State Street Institutional U.S. Government Money 
 
 
Market Fund - Premier Class 1.97%(a)  
1,295,792  
1,295,792 
Total Cash Equivalents (Cost $1,295,792)  
 
1,295,792 
Total Investments in Securities (Cost $53,870,896)  
 
53,121,824 
Other Assets Less Other Liabilities — 0.6%  
325,001 
Net Assets - 100%  
 
53,446,825 
Net Asset Value Per Share - Investor Class  
10.02 
Net Asset Value Per Share - Institutional Class  
10.02 
 
(a)     
Rate presented represents the annualized 7-day yield at September 30, 2018.
(b)     
Number of years indicated represents estimated average life.
(c)     
Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers.
(d) Foreign domiciled entity
(e) Annual sinking fund
(f) The interest rate resets periodically based on the weighted average coupons of the underlying mortgage-related or asset-backed obligations.
 
The accompanying notes form an integral part of these financial statements.
 
37  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
SHORT DURATION INCOME FUND
Schedule of Investments
September 30, 2018
 
   
Corporate Bonds – 36.6% 
 
 
 
$ Principal 
 
 
Amount  
$ Value 
 
American Express Co. 8.125% 5/20/19  
5,616,000  
5,805,347 
American Express Credit Corp. 2.25% 8/15/19  
11,042,000  
10,991,548 
Andeavor Logistics LP 6.25% 10/15/22  
210,000  
216,038 
Anheuser-Busch InBev Finance Inc. 3.3% 2/01/23  
4,800,000  
4,743,486 
Apple Inc. 1.55% 2/08/19  
1,000,000  
996,971 
AT&T Inc. 2.375% 11/27/18  
5,368,000  
5,366,273 
Bank of America Corp.  
 
2.65% 4/01/19  
6,175,000  
6,175,971 
2.25% 4/21/20  
12,000,000  
11,842,604 
Berkshire Hathaway Inc.  
 
2.1% 8/14/19  
2,750,000  
2,736,371 
Finance Corp. 
 
 
1.7% 3/15/19  
2,400,000  
2,391,923 
2.65144% 1/10/20 Floating Rate (Qtrly LIBOR + 32)  
7,000,000  
7,015,071 
2.9% 10/15/20  
3,000,000  
3,000,017 
4.25% 1/15/21  
4,200,000  
4,308,517 
Boardwalk Pipelines LLC 5.75% 9/15/19  
11,008,000  
11,279,652 
Boston Properties LP  
 
5.875% 10/15/19  
11,440,000  
11,710,815 
3.125% 9/01/23  
9,560,000  
9,303,464 
Calumet Specialty Products Partners LP 7.625% 1/15/22  
900,000  
906,750 
Capital One Bank USA, N.A. 
 
 
2.3% 6/05/19  
7,000,000  
6,976,637 
8.8% 7/15/19  
3,500,000  
3,659,825 
Capital One Financial Corp. 2.5% 5/12/20  
5,000,000  
4,939,581 
Capital One N.A. 2.4% 9/05/19  
2,000,000  
1,989,655 
Comcast Corp. 5.15% 3/01/20  
3,000,000  
3,084,934 
Computer Sciences Corp. 4.45% 9/15/22  
325,000  
330,022 
Dell Inc. 3.48% 6/01/19(c)  
5,000,000  
5,013,530 
Discovery, Inc. 2.95% 3/20/23  
1,600,000  
1,534,200 
Dominion Resources, Inc. 2.962% 7/01/19  
9,883,000  
9,880,268 
eBay, Inc. 2.2% 8/01/19  
3,000,000  
2,985,348 
Equifax Inc. 2.3% 6/01/21  
2,900,000  
2,798,482 
Equity Commonwealth 5.875% 9/15/20  
14,195,000  
14,601,102 
Express Scripts Holding Co. 
 
 
2.25% 6/15/19  
8,955,000  
8,915,283 
7.25% 6/15/19  
5,217,000  
5,369,344 
Fifth Third Bank 1.625% 9/27/19  
2,000,000  
1,974,758 
First Republic Bank 2.375% 6/17/19  
2,753,000  
2,745,915 
Flir Systems, Inc. 3.125% 6/15/21  
2,600,000  
2,559,705 
Ford Motor Credit Co. LLC  
 
2.943% 1/08/19  
2,000,000  
2,002,172 
2.021% 5/03/19  
10,000,000  
9,941,573 
1.897% 8/12/19  
1,000,000  
989,463 
Fortive Corp. 1.8% 6/15/19  
750,000  
742,989 
General Motors Financial Co., Inc. 3.55% 4/09/21  
1,250,000  
1,250,173 
Goldman Sachs Group, Inc.  
 
3.13425% 12/13/19 Floating Rate (Qtrly LIBOR + 80)  
6,250,000  
6,291,826 
3.50706% 4/23/20 Floating Rate (Qtrly LIBOR + 116)  
5,479,000  
5,549,776 
2.6% 12/27/20  
1,500,000  
1,476,644 
Invista B.V. 4.25% 10/15/19(c)  
4,980,000  
4,997,181 
JPMorgan Chase & Co.  
 
6.3% 4/23/19  
2,500,000  
2,549,740 
2.87713% 3/09/21 Floating Rate (Qtrly LIBOR + 55)  
1,850,000  
1,855,686 
JPMorgan Chase Bank, N.A. 2.95638% 9/23/19 Floating 
 
 
Rate (Qtrly LIBOR + 59)  
12,000,000  
12,055,728 
Lennar Corp. 4.5% 6/15/19  
3,977,000  
4,011,799 
The Manitowoc Co., Inc. 12.75% 8/15/21(c)  
8,950,000  
9,822,625 
Markel Corp.  
 
7.125% 9/30/19  
11,859,000  
12,275,298 
5.35% 6/01/21  
10,000,000  
10,427,575 
4.9% 7/01/22  
3,850,000  
3,966,913 
 
 
   
 
$ Principal 
 
 
Amount  
$ Value 
 
MetLife Global Funding I(c) 
 
 
1.75% 12/19/18  
1,000,000  
998,645 
2.3% 4/10/19  
2,000,000  
1,996,238 
NGL Energy Partners LP 5.125% 7/15/19  
2,200,000  
2,219,250 
Omnicom Group, Inc. 6.25% 7/15/19  
6,181,000  
6,340,456 
Plains All American Pipeline, LP 2.6% 12/15/19  
1,345,000  
1,334,871 
QVC, Inc. 3.125% 4/01/19  
1,611,000  
1,611,259 
Range Resources Corp. 5.0% 8/15/22  
6,000,000  
5,970,000 
RELX plc 3.5% 3/16/23  
1,800,000  
1,778,430 
Sprint Spectrum Co. LLC 3.36% 3/20/23(c) (e)  
3,562,500  
3,558,047 
U.S. Bancorp 2.35% 1/29/21  
14,000,000  
13,735,534 
U.S. Bank, N.A. 2.66156% 1/24/20 Floating Rate 
 
 
(Qtrly LIBOR + 32)  
7,000,000  
7,019,156 
VEREIT, Inc. 3.0% 2/06/19  
1,870,000  
1,869,924 
Walt Disney Co. 0.875% 7/12/19  
1,000,000  
986,211 
Wells Fargo & Co. 
 
 
2.15% 1/15/19  
4,531,000  
4,526,125 
2.125% 4/22/19  
2,800,000  
2,791,387 
4.6% 4/01/21  
5,745,000  
5,909,459 
2.1% 7/26/21  
10,100,000  
9,728,780 
3.5% 3/08/22  
7,900,000  
7,890,883 
Wells Fargo Bank, N.A. 2.15% 12/06/19  
10,000,000  
9,905,271 
Total Corporate Bonds (Cost $359,902,316)  
 
358,526,494 
 
Corporate Convertible Bonds – 3.5% 
 
 
 
Redwood Trust, Inc. 
 
 
5.625% 11/15/19  
14,850,000  
15,061,464 
4.75% 8/15/23  
14,650,000  
14,055,576 
5.625% 7/15/24  
5,500,000  
5,441,563 
Total Corporate Convertible Bonds (Cost $34,954,928)  
34,558,603 
 
Asset-Backed Securities – 13.0%(b) 
 
 
 
ARI Fleet Lease Trust (ARIFL)(c)  
 
2018-B CL A2 — 3.22% 2027 (1.8 years)  
1,000,000  
999,974 
Ascentium Equipment Receivables Trust (ACER)(c)  
2018-1A CL A1 — 2.5% 2019 (0.2 years)  
1,685,486  
1,685,590 
2018-1A CL A2 — 2.92% 2020 (0.9 years)  
4,300,000  
4,296,718 
2016-2A CL E — 6.79% 2024 (2.0 years)  
1,600,000  
1,664,830 
Commercial Credit Group Receivables Trust (CCG)(c)  
2018-1 CL A1 — 1.85% 2019 (0.1 years)  
1,052,661  
1,052,305 
Conn Funding II, LP (CONN)(c)  
 
2017-B CL A — 2.73% 2020 (0.1 years)  
549,004  
548,942 
2018-A CL A — 3.25% 2023 (0.3 years)  
1,589,805  
1,590,139 
Credit Acceptance Auto Loan Trust (CAALT)(c)  
2016-2A CL B — 3.18% 2024 (0.7 years)  
1,185,000  
1,185,461 
2016-2A CL C — 4.29% 2024 (0.9 years)  
300,000  
302,287 
Drive Auto Receivables Trust (DRIVE)  
 
2018-4 CL A3 — 3.04% 2021 (0.9 years)  
2,500,000  
2,500,606 
2017-1 CL D — 3.84% 2023 (1.3 years)  
6,000,000  
6,026,086 
Exeter Automobile Receivables Trust (EART)(c)  
2016-3A CL A — 1.84% 2020 (0.1 years)  
458,805  
458,335 
2018-2A CL A — 2.79% 2021 (0.4 years)  
6,105,439  
6,101,045 
2015-1A CL C — 4.1% 2020 (0.4 years)  
445,412  
447,529 
2017-3A CL A — 2.05% 2021 (0.4 years)  
1,734,704  
1,726,711 
2016-2A CL C — 5.96% 2022 (1.0 years)  
5,100,000  
5,227,570 
2018-3A CL A — 2.9% 2022 (1.0 years)  
3,536,798  
3,529,989 
 
The accompanying notes form an integral part of these financial statements.
 
38  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM
 
 
   
 
 
 
 
$ Principal  
 
 
Amount  
$ Value 
 
Hertz Fleet Lease Funding LP (HFLF)(c)  
 
2018-1 CL A1 — 2.56344% 2032 Floating Rate 
 
 
(Mthly LIBOR + 50) (1.6 years)  
4,000,000  
4,010,715 
2018-1 CL A2 — 3.23% 2032 (1.6 years)  
1,900,000  
1,899,177 
Honor Automobile Trust Securitization (HATS)(c)  
2016-1A CL A — 2.94% 2019 (0.1 years)  
173,100  
173,103 
Marlette Funding Trust (MFT)(c)  
 
2016-1A CL B — 4.78% 2023 (0.2 years)  
2,061,890  
2,072,770 
2017-1A CL A — 2.827% 2024 (0.2 years)  
983,521  
983,534 
2017-2A CL A — 2.39% 2024 (0.2 years)  
1,365,691  
1,363,699 
2017-3A CL A — 2.36% 2024 (0.4 years)  
1,379,502  
1,374,750 
2018-1A CL A — 2.61% 2028 (0.6 years)  
2,770,599  
2,762,657 
2017-1A CL B — 4.114% 2024 (0.7 years)  
1,650,000  
1,656,306 
2018-2A CL A — 3.06% 2028 (0.8 years)  
2,793,730  
2,793,230 
2017-2A CL B — 3.19% 2024 (0.8 years)  
3,000,000  
2,994,257 
2018-3A CL A — 3.2% 2028 (0.9 years)  
8,466,373  
8,466,620 
OneMain Direct Auto Receivables Trust (ODART)(c)  
2017-2A CL B — 2.55% 2023 (1.6 years)  
7,000,000  
6,898,965 
OneMain Financial Issuance Trust (OMFIT)(c)  
2015-2A CL C — 4.32% 2025 (0.0 years)  
4,800,000  
4,820,660 
2015-1A CL D — 6.63% 2026 (0.0 years)  
1,600,000  
1,633,956 
2016-2A CL B — 5.94% 2028 (1.1 years)  
1,195,000  
1,219,518 
2015-2A CL D — 5.64% 2025 (1.4 years)  
6,000,000  
6,052,700 
2016-2A CL C — 5.67% 2028 (1.5 years)  
2,500,000  
2,546,520 
Prestige Auto Receivables Trust (PART)(c)  
2018-1A CL A2 — 2.97% 2021 (0.9 years)  
4,000,000  
3,998,125 
SoFi Consumer Loan Program LLC (SCLP)(c)  
2017-6 CL A1 — 2.2% 2026 (0.5 years)  
2,139,771  
2,127,833 
2018-1 CL A1 — 2.55% 2027 (0.6 years)  
874,954  
871,081 
2016-2 CL A — 3.09% 2025 (0.9 years)  
3,225,530  
3,219,869 
2016-3 CL A — 3.05% 2025 (0.9 years)  
657,035  
654,371 
2017-1 CL A — 3.28% 2026 (1.2 years)  
599,085  
598,477 
Springleaf Funding Trust (SLFT)(c)  
 
2015-AA CL C — 5.04% 2024 (0.0 years)  
6,800,000  
6,776,237 
2015-AA CL A — 3.16% 2024 (0.4 years)  
3,189,617  
3,190,045 
Upstart Securitization Trust (UPST)(c)  
 
2018-1 CL A — 3.015% 2025 (0.3 years)  
1,449,295  
1,449,319 
2018-2 CL A — 3.33% 2025 (0.6 years)  
3,242,000  
3,243,936 
2017-1 CL C — 6.35% 2024 (1.5 years)  
3,000,000  
3,057,604 
2017-2 CL C — 5.59% 2025 (2.2 years)  
2,500,000  
2,531,674 
Westlake Automobile Receivables Trust (WLAKE)(c)  
2018-3A CL A2A — 2.98% 2022 (1.5 years)  
3,000,000  
2,999,240 
Total Asset-Backed Securities (Cost $128,004,723)  
 
127,785,065 
 
Commercial Mortgage-Backed Securities – 1.3%(b) 
 
 
GPMT (GPMT)(c) (d) 
 
 
2018-FL1 CL A — 2.97% 2035 Floating Rate 
 
 
(Mthly LIBOR + 90) (1.6 years)  
5,000,000  
5,007,500 
TPG Real Estate Finance (TRTX)(c) (d) 
 
 
2018-FL1 CL A — 2.81% 2035 Floating Rate 
 
 
(Mthly LIBOR + 75) (0.8 years)  
3,500,000  
3,502,331 
VMC Finance LLC (VMC)(c) 
 
 
2018-FL1 CL A — 2.88269% 2035 Floating Rate 
 
 
(Mthly LIBOR + 82) (1.0 years)  
1,901,188  
1,902,854 
VSD LLC (VSD)(c) 
 
 
2017-PLT1 CL A — 3.6% 2043 (0.3 years)  
2,554,264  
2,553,582 
Total Commercial Mortgage-Backed Securities (Cost $12,955,452)  
12,966,267 
 
 
   
Mortgage-Backed Securities – 16.8%(b) 
 
 
$ Principal 
 
Federal Home Loan Mortgage Corporation  
Amount  
$ Value 
 
Collateralized Mortgage Obligations 
 
 
3844 CL AG — 4.0% 2025 (0.2 years)  
110,328  
110,405 
4281 CL AG — 2.5% 2028 (2.2 years)  
1,208,677  
1,177,881 
3649 CL BW — 4.0% 2025 (2.3 years)  
1,624,261  
1,633,316 
2952 CL PA — 5.0% 2035 (3.0 years)  
440,861  
451,426 
3620 CL PA — 4.5% 2039 (3.9 years)  
1,114,703  
1,149,622 
4107 CL LA — 2.5% 2031 (4.8 years)  
6,957,653  
6,480,685 
3842 CL PH — 4.0% 2041 (4.8 years)  
1,205,119  
1,232,213 
3003 CL LD — 5.0% 2034 (4.9 years)  
1,176,284  
1,249,882 
4107 CL LW — 1.75% 2027 (7.1 years) 
3,920,541  
3,443,778 
 
16,929,208 
Pass-Through Securities 
 
 
G18190 — 5.5% 2022 (1.5 years)  
16,711  
17,191 
G13300 — 4.5% 2023 (1.8 years)  
105,386  
108,996 
G18296 — 4.5% 2024 (2.0 years)  
276,552  
286,054 
G18306 — 4.5% 2024 (2.1 years)  
575,859  
595,653 
G18308 — 4.0% 2024 (2.1 years)  
595,562  
609,766 
G13517 — 4.0% 2024 (2.1 years)  
388,633  
397,897 
J13949 — 3.5% 2025 (2.7 years)  
3,629,432  
3,657,411 
J14649 — 3.5% 2026 (2.8 years)  
2,799,686  
2,817,389 
E02804 — 3.0% 2025 (2.8 years)  
2,225,909  
2,210,713 
E02948 — 3.5% 2026 (2.9 years)  
6,267,326  
6,306,939 
J16663 — 3.5% 2026 (2.9 years)  
5,973,583  
6,011,314 
E03033 — 3.0% 2027 (3.1 years)  
3,462,531  
3,438,796 
E03048 — 3.0% 2027 (3.1 years)  
6,586,683  
6,541,517 
G01818 — 5.0% 2035 (5.1 years)  
1,381,477  
1,467,533 
 
34,467,169 
Structured Agency Credit Risk Debt Notes  
 
 
2013-DN1 CL M1 — 5.46475% 2023 Floating Rate  
 
 
(Mthly LIBOR + 340) (0.1 years)  
68,440  
68,604 
 
51,464,981 
Federal National Mortgage Association  
 
Collateralized Mortgage Obligations  
 
 
2010-145 CL PA — 4.0% 2024 (1.3 years)  
434,454  
436,605 
2010-54 CL WA — 3.75% 2025 (1.9 years)  
705,394  
705,942 
 
1,142,547 
Pass-Through Securities 
 
 
254907 — 5.0% 2018 (0.0 years)  
53  
53 
MA0464 — 3.5% 2020 (0.7 years)  
575,119  
578,593 
357985 — 4.5% 2020 (0.9 years)  
24,491  
24,805 
888595 — 5.0% 2022 (1.2 years)  
77,131  
79,660 
888439 — 5.5% 2022 (1.2 years)  
82,831  
84,784 
AD0629 — 5.0% 2024 (1.5 years)  
313,192  
323,810 
995960 — 5.0% 2023 (1.5 years)  
278,050  
288,415 
AL0471 — 5.5% 2025 (1.8 years)  
1,338,662  
1,386,195 
AR8198 — 2.5% 2023 (1.8 years)  
3,811,383  
3,770,673 
995693 — 4.5% 2024 (1.8 years)  
555,604  
576,297 
AE0031 — 5.0% 2025 (1.9 years)  
534,876  
554,947 
MA1502 — 2.5% 2023 (1.9 years)  
3,186,301  
3,152,279 
995692 — 4.5% 2024 (2.0 years)  
463,161  
478,405 
890112 — 4.0% 2024 (2.1 years)  
372,732  
380,642 
995755 — 4.5% 2024 (2.1 years)  
721,574  
748,755 
AA4315 — 4.0% 2024 (2.1 years)  
780,584  
797,278 
MA0043 — 4.0% 2024 (2.1 years)  
304,204  
310,701 
AA5510 — 4.0% 2024 (2.1 years)  
183,257  
187,177 
930667 — 4.5% 2024 (2.1 years)  
454,501  
471,597 
931739 — 4.0% 2024 (2.3 years)  
200,893  
205,172 
AD7073 — 4.0% 2025 (2.5 years)  
648,226  
662,203 
310139 — 3.5% 2025 (2.6 years)  
4,304,990  
4,330,995 
AH3429 — 3.5% 2026 (2.7 years)  
11,388,293  
11,474,722 
AB1769 — 3.0% 2025 (2.8 years)  
2,078,460  
2,066,299 
AB2251 — 3.0% 2026 (2.8 years)  
2,573,277  
2,558,221 
AB3902 — 3.0% 2026 (3.1 years)  
1,637,776  
1,628,183 
AK3264 — 3.0% 2027 (3.2 years)  
4,198,100  
4,173,505 
 
The accompanying notes form an integral part of these financial statements.
 
39  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

SHORT DURATION INCOME FUND (CONTINUED)
 
   
 
$ Principal  
 
 
Amount  
$ Value 
 
AB4482 — 3.0% 2027 (3.2 years)  
3,885,304  
3,862,538 
AL1366 — 2.5% 2027 (3.3 years)  
2,919,797  
2,841,617 
MA0587 — 4.0% 2030 (4.4 years)  
4,229,575  
4,306,107 
555531 — 5.5% 2033 (4.6 years)  
2,772,009  
3,004,895 
725232 — 5.0% 2034 (4.8 years)  
250,751  
266,365 
995112 — 5.5% 2036 (5.0 years)  
1,201,198  
1,301,032 
 
56,876,920 
 
58,019,467 
Government National Mortgage Association  
 
 
 
Pass-Through Securities 
 
 
G2 5255 — 3.0% 2026 (3.1 years)  
7,489,838  
7,439,142 
 
Non-Government Agency  
 
 
 
Collateralized Mortgage Obligations 
 
 
Citigroup Mortgage Loan Trust, Inc. (CMLTI)(c) (f) 
 
 
2014-A CL A — 4.0% 2035 (4.6 years)  
1,333,969  
1,345,959 
COLT Funding LLC (COLT)(c) (f)  
 
2017-2 CL A1A — 2.415% 2047 (1.5 years)  
3,134,873  
3,121,356 
Flagstar Mortgage Trust (FSMT)(c) (f)  
 
2017-1 CL 2A2 — 3.0% 2047 (3.4 years)  
3,026,286  
2,971,005 
J.P. Morgan Mortgage Trust (JPMMT)(c) (f)  
2014-2 CL 2A2 — 3.5% 2029 (3.7 years)  
3,434,525  
3,427,010 
2014-5 CL A1 — 2.9878% 2029 (4.3 years)  
6,512,865  
6,396,745 
2017-3 CL 2A2 — 2.5% 2047 (4.7 years)  
11,355,035  
10,896,122 
2016-3 CL 2A1 — 3.0% 2046 (5.4 years)  
2,780,713  
2,728,397 
2018-6 CL 2A2 — 3.0% 2048 (5.4 years)  
4,567,983  
4,558,345 
Sequoia Mortgage Trust (SEMT)(f)  
 
2012-1 CL 1A1 — 2.865% 2042 (1.5 years)  
597,015  
601,551 
2017-CH1 CL A11 — 3.5% 2047 (2.6 years)(c)  
3,078,503  
3,069,935 
2013-4 CL A3 — 1.55% 2043 (3.4 years)  
6,316,482  
6,009,370 
2012-4 CL A1 — 3.5% 2042 (10.5 years)  
2,443,508  
2,381,486 
 
47,507,281 
Total Mortgage-Backed Securities (Cost $165,765,105)  
164,430,871 
 
Taxable Municipal Bonds – 0.2% 
 
 
 
Kansas Development Finance Authority Revenue, Series 2015H 
 
2.258% 4/15/19  
1,000,000  
997,700 
2.608% 4/15/20  
500,000  
497,115 
2.927% 4/15/21  
750,000  
740,355 
Total Taxable Municipal Bonds (Cost $2,250,000)  
 
2,235,170 
 
U.S. Treasury – 27.5% 
 
 
 
U.S. Treasury Notes 
 
 
1.5% 12/31/18  
10,000,000  
9,982,086 
1.25% 1/31/19  
15,000,000  
14,947,448 
0.875% 5/15/19  
25,000,000  
24,755,859 
1.625% 6/30/19  
10,000,000  
9,935,111 
1.5% 10/31/19  
15,000,000  
14,813,672 
1.375% 1/31/20  
15,000,000  
14,738,379 
1.625% 3/15/20  
15,000,000  
14,763,281 
1.375% 8/31/20  
10,000,000  
9,733,594 
2.125% 8/31/20  
15,000,000  
14,808,105 
2.0% 11/30/20  
20,000,000  
19,648,828 
1.125% 2/28/21  
15,000,000  
14,398,828 
2.25% 3/31/21  
12,000,000  
11,826,094 
1.375% 4/30/21  
10,000,000  
9,632,812 
2.625% 6/15/21  
10,000,000  
9,936,328 
 
 
   
 
$ Principal  
 
 
Amount  
 
 
or Shares  
$ Value 
 
   
1.125% 7/31/21  
15,000,000  
14,290,137 
2.0% 7/31/22  
17,000,000  
16,437,539 
2.0% 2/15/23  
7,500,000  
7,213,623 
1.5% 2/28/23  
15,000,000  
14,112,012 
2.0% 5/31/24  
15,000,000  
14,242,383 
2.25% 10/31/24  
10,000,000  
9,591,602 
Total U.S. Treasury (Cost $275,425,074)  
 
269,807,721 
 
 
 
Common Stocks – 0.4% 
 
 
 
Redwood Trust, Inc. (Cost $2,221,259)  
250,000  
4,060,000 
 
   
Cash Equivalents – 0.2% 
 
 
 
State Street Institutional U.S. Government Money  
 
 
Market Fund - Premier Class 1.97%(a)  
2,281,499  
2,281,499 
Total Cash Equivalents (Cost $2,281,499)  
 
2,281,499 
Total Investments in Securities (Cost $983,760,356)  
976,651,690 
Other Assets Less Other Liabilities — 0.5%  
4,349,231 
Net Assets - 100%  
 
981,000,921 
Net Asset Value Per Share - Investor Class  
12.04 
Net Asset Value Per Share - Institutional Class  
12.06 
 
(a)     
Rate presented represents the annualized 7-day yield at September 30, 2018.
(b)     
Number of years indicated represents estimated average life.
(c)     
Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers.
(d)     
Foreign domiciled entity
(e)     
Annual sinking fund
(f)     
The interest rate resets periodically based on the weighted average coupons of the underlying mortgage-related or asset-backed obligations.
 
The accompanying notes form an integral part of these financial statements.
 
40  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM

ULTRA SHORT GOVERNMENT FUND
Schedule of Investments
September 30, 2018
 
   
Corporate Bonds – 9.9% 
 
 
 
$ Principal 
 
 
Amount  
$ Value 
 
American Express Credit Corp. 1.875% 11/05/18  
675,000  
674,871 
Citibank, N.A. 
 
 
2.57144% 11/09/18 Floating Rate (Qtrly LIBOR + 23)  
915,000  
915,294 
2.0% 3/20/19  
595,000  
593,444 
2.6775% 3/20/19 Floating Rate (Qtrly LIBOR + 34)  
750,000  
750,973 
General Motors Co. 3.5% 10/02/18  
500,000  
500,000 
Morgan Stanley 2.45% 2/01/19  
500,000  
499,717 
RELX plc 8.625% 1/15/19  
800,000  
812,610 
Roper Technologies, Inc. 2.05% 10/01/18  
249,000  
249,000 
Simon Property Group, LP 2.2% 2/01/19  
269,000  
268,671 
Stanley Black & Decker, Inc. 1.622% 11/17/18  
1,635,000  
1,632,484 
State Street Bank & Trust Co. 5.25% 10/15/18  
2,030,000  
2,031,989 
WM. Wrigley Jr. Co. 2.4% 10/21/18(b)  
1,700,000  
1,699,863 
Total Corporate Bonds (Cost $10,629,218)  
 
10,628,916 
 
Asset-Backed Securities – 8.1% 
 
 
 
Ascentium Equipment Receivables Trust (ACER)(b) 
 
 
2018-1A CL A1 — 2.5% 2019 (0.2 years)  
518,611  
518,643 
CarMax Auto Owner Trust (CARMX)  
 
 
2018-1 CL A2B — 2.21269% 2021 Floating Rate  
 
 
(Mthly LIBOR + 15) (0.5 years)  
837,128  
837,594 
2014-4 CL C — 2.44% 2020 (1.0 years)  
1,040,000  
1,038,994 
Commercial Credit Group Receivables Trust (CCG)(b)  
 
 
2018-1 CL A1 — 1.85% 2019 (0.1 years)  
168,426  
168,369 
2018-2 CL A1 — 2.47% 2019 (0.3 years)  
1,588,752  
1,588,862 
Credit Acceptance Auto Loan Trust (CAALT)(b)  
 
 
2016-2A CL B — 3.18% 2024 (0.7 years)  
755,000  
755,294 
Drive Auto Receivables Trust (DRIVE)  
 
 
2018-4 CL A2A — 2.78% 2020 (0.4 years)  
1,000,000  
1,000,234 
Exeter Automobile Receivables Trust (EART)(b) 
 
 
2018-2A CL A — 2.79% 2021 (0.4 years)  
330,024  
329,786 
2018-3A CL A — 2.9% 2022 (1.0 years)  
884,199  
882,497 
Marlette Funding Trust (MFT)(b)  
 
 
2018-3A CL A — 3.2% 2028 (0.9 years)  
465,185  
465,199 
SoFi Consumer Loan Program LLC (SCLP)(b) 
 
 
2017-6 CL A1 — 2.2% 2026 (0.5 years)  
740,361  
736,230 
World Omni Auto Receivables Trust (WOART)  
 
 
2018-B CL A1 — 2.25% 2019 (0.1 years)  
461,986  
461,989 
Total Asset-Backed Securities (Cost $8,785,634)  
 
8,783,691 
 
 
   
U.S. Treasury – 81.2%  
$ Principal 
 
 
Amount 
 
 
or Shares  
$ Value 
 
U.S. Treasury Notes 
 
 
1.75% 10/31/18  
19,500,000  
19,495,160 
1.25% 11/15/18  
13,750,000  
13,735,747 
1.375% 11/30/18  
12,500,000  
12,483,972 
1.375% 12/31/18  
12,500,000  
12,473,786 
1.125% 1/15/19  
4,000,000  
3,987,060 
1.375% 2/28/19  
15,500,000  
15,438,242 
1.625% 7/31/19  
5,300,000  
5,258,180 
1.75% 9/30/19  
5,000,000  
4,955,957 
Total U.S. Treasury (Cost $87,852,865)  
 
87,828,104 
 
Cash Equivalents – 0.4% 
 
 
 
State Street Institutional U.S. Government Money 
 
 
Market Fund - Premier Class 1.97%(a)  
456,913  
456,913 
Total Cash Equivalents (Cost $456,913)  
 
456,913 
Total Investments in Securities (Cost $107,724,630)  
107,697,624 
Other Assets Less Other Liabilities — 0.4%  
429,316 
Net Assets - 100%  
 
108,126,940 
Net Asset Value Per Share  
10.00 
 
(a)     
Rate presented represents the annualized 7-day yield at September 30, 2018.
(b)     
Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally, to qualified institutional buyers.
 
The accompanying notes form an integral part of these financial statements.

41  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
NEBRASKA TAX-FREE INCOME FUND
Schedule of Investments
September 30, 2018
 
     
Municipal Bonds – 99.6% 
 
 
 
 
% of Net  
$ Principal 
 
 
Assets  
Amount  
$ Value 
 
California  
0.4 
 
 
San Diego County Regional Airport Authority, Subordinate 
 
 
Airport Revenue, Series 2017B, AMT, 5.0%, 7/01/25  
200,000  
228,458 
 
Colorado  
0.2 
 
 
Colorado Bridge Enterprise, Senior Revenue, Central 70 
 
 
Project, Series 2017, AMT, 4.0%, 12/31/23  
100,000  
105,415 
 
District of Columbia  
1.1 
 
 
Metropolitan Washington Airports Authority, Aviation System 
 
Revenue, Refunding, Series 2017A, AMT, 5.0%, 10/01/27  
500,000  
576,635 
 
Florida  
2.9 
 
 
Greater Orlando Aviation Authority, Priority Subordinated 
 
 
Airport Facilities Revenue, Series 2017A, AMT, 
 
 
5.0%, 10/01/25  
500,000  
566,740 
Miami, Dade County, Aviation Revenue, 
 
 
 
Series 2010A, 4.25%, 10/01/18  
1,000,000  
1,000,000 
 
1,566,740 
Illinois  
0.2 
 
 
Cook, Kane, Lake and McHenry Counties and State of 
 
 
Illinois, General Obligation, Community College 
 
 
District No. 512, Series 2009A, 5.0%, 12/01/23, 
 
 
Pre-Refunded 12/01/18 @ 100  
100,000  
100,523 
 
Nebraska  
91.2 
 
 
Blair, Water System Revenue, Series 2016, AMT,  
2.2%, 12/15/22  
175,000  
170,182 
2.45%, 12/15/23  
125,000  
120,886 
2.65%, 12/15/24  
100,000  
95,133 
2.85%, 12/15/25  
100,000  
95,214 
3.0%, 12/15/26  
100,000  
94,539 
3.1%, 12/15/27  
100,000  
93,786 
3.2%, 12/15/28  
100,000  
93,508 
3.35%, 12/15/29  
100,000  
92,716 
3.5%, 12/15/30  
100,000  
92,551 
Buffalo County, General Obligation, Kearney Public 
 
 
Schools District 0007, Series 2016 
 
 
 
2.0%, 12/15/18  
305,000  
305,085 
3.0%, 12/15/24  
250,000  
256,700 
Cass County, General Obligation, Refunding, Weeping 
 
 
Water Public School District 0022, Series 2017 
 
 
2.05%, 12/15/25  
375,000  
346,095 
2.2%, 12/15/26  
250,000  
231,402 
Chadron, Sales Tax and General Obligation, Aquatic Center, 
 
 
Series 2016, 1.6%, 7/15/22  
400,000  
382,192 
Columbus, Combined Revenue, Refunding, Series 2016, 
 
 
AGM Insured 
 
 
 
4.0%, 12/15/26  
100,000  
109,582 
4.0%, 12/15/27  
100,000  
108,967 
Cornhusker Public Power District, Electric System Revenue, 
 
 
Refunding, Series 2014, 2.25%, 7/01/22  
260,000  
260,117 
Dawson Public Power District, Electric System Revenue,  
 
 
2.0%, 6/15/26  
170,000  
157,967 
2.1%, 6/15/27  
 
105,000  
95,306 
Series 2016B 
 
 
 
2.5%, 6/15/28  
135,000  
125,677 
3.0%, 6/15/29  
245,000  
237,616 
3.0%, 6/15/30  
355,000  
340,835 
Douglas County, Educational Facility Revenue, Refunding,  
 
 
Creighton University Project, Series 2010A, 5.6%, 7/01/25,  
Pre-Refunded 7/01/20 @ 100  
400,000  
423,952 
 
 
   
 
$ Principal 
 
 
Amount  
$ Value 
 
Douglas County, General Obligation,  
 
 
Omaha Public School District 0001  
 
 
Series 2015, 5.0%, 12/15/28  
1,000,000  
1,137,240 
Series 2016, 5.0%, 12/15/29  
350,000  
406,346 
Refunding, Elkhorn Public School District 0010, Series 2016B,  
3.0%, 12/15/18  
100,000  
100,229 
Westside Community School District 0066, Series 2015,  
2.5%, 12/01/22  
250,000  
251,080 
Douglas County, Hospital Authority #2, Revenue, 
 
 
Madonna Rehabilitation Hospital Project, Series 2014,  
5.0%, 5/15/26  
500,000  
545,130 
Nebraska Medicine, Series 2016, 4.0%, 5/15/32(c)  
700,000  
726,530 
Douglas County, Hospital Authority #3, Revenue, Refunding, 
 
Nebraska Methodist Health System  
 
 
Series 2008, 5.5%, 11/01/18, Escrowed to Maturity(b)  
155,000  
155,448 
Series 2015 
 
 
4.0%, 11/01/18  
250,000  
250,345 
4.0%, 11/01/19  
110,000  
111,900 
5.0%, 11/01/20  
100,000  
105,390 
5.0%, 11/01/21  
100,000  
107,643 
5.0%, 11/01/22  
250,000  
274,200 
Fremont, Combined Utility Revenue, Series 2014B, 
 
 
3.0%, 7/15/21  
370,000  
377,344 
Hamilton County, General Obligation, Hampton Public 
 
 
School District 0091, Series 2016, 1.0%, 12/15/19  
300,000  
295,572 
Lincoln-Lancaster County, Public Building Commission,  
Lease Revenue, 
 
 
Refunding, Series 2015, 3.0%, 12/01/19  
750,000  
759,180 
Series 2016, 3.0%, 12/01/25  
500,000  
515,630 
Lincoln, Airport Authority, Revenue, 2014 Series C  
2.0%, 7/01/19  
190,000  
190,180 
2.0%, 7/01/21  
195,000  
194,479 
Lincoln, Educational Facilities, Revenue, Refunding,  
 
 
Nebraska Wesleyan University Project, Series 2012  
 
 
2.25%, 4/01/19  
645,000  
645,348 
2.5%, 4/01/21  
925,000  
928,570 
Lincoln, Electric System Revenue, Refunding,  
Series 2012  
 
5.0%, 9/01/21  
1,000,000  
1,081,540 
5.0%, 9/01/28  
1,000,000  
1,096,160 
Series 2016, 3.0%, 9/01/28  
1,000,000  
995,730 
Lincoln, General Obligation, Highway Allocation Fund, 
 
 
Refunding, Series 2016 
 
 
5.0%, 5/15/22  
100,000  
110,201 
5.0%, 5/15/23  
135,000  
151,894 
Lincoln, General Obligation, West Haymarket Joint 
 
 
Public Agency, Series 2011, 5.0%, 12/15/26  
300,000  
325,830 
Loup River Public Power District, Electric System Revenue,  
Refunding, Series 2016  
5.0%, 12/01/18  
500,000  
502,575 
5.0%, 12/01/19  
500,000  
517,450 
Madison County, Hospital Authority #1, Revenue,  
Faith Regional Health Services Project, Series 2018  
3.0%, 7/01/19  
100,000  
100,314 
Refunding, Faith Regional Health Services Project, Series 2017A 
 
5.0%, 7/01/21  
475,000  
502,944 
5.0%, 7/01/23  
250,000  
271,612 
Metropolitan Utilities District of Omaha, Gas System Revenue,  
 
Series 2018, 4.0%, 12/01/27  
450,000  
482,206 
Municipal Energy Agency of Nebraska, Power Supply  
 
 
System Revenue, Refunding, 
 
 
2009 Series A, BHAC Insured, 
 
 
5.0%, 4/01/20, Pre-Refunded 4/01/19 @ 100  
500,000  
507,735 
2012 Series A, 5.0%, 4/01/29  
300,000  
325,071 
2016 Series A 
 
 
5.0%, 4/01/21  
250,000  
266,793 
5.0%, 4/01/27  
350,000  
403,204 
 
The accompanying notes form an integral part of these financial statements.
 
42  |  Q3 2018 SEMI-ANNUAL REPORT

WEITZINVESTMENTS.COM


 
   
 
$ Principal 
 
 
Amount  
$ Value 
 
Nebraska, Certificates of Participation,  
 
 
Series 2015C 
 
 
1.45%, 9/15/19  
360,000  
356,422 
1.7%, 9/15/20  
200,000  
198,068 
Series 2016A, 2.0%, 2/15/19  
750,000  
750,293 
Series 2017B, 1.35%, 7/15/20  
785,000  
767,761 
Series 2018A, 2.1%, 7/15/21  
860,000  
857,214 
Nebraska Investment Financial Authority, Single Family 
 
 
Housing Revenue, 2016 Series C, 1.85%, 3/01/23  
100,000  
97,381 
Nebraska Public Power District, Revenue, 
 
 
2012 Series A 
 
 
4.0%, 1/01/21  
500,000  
520,845 
5.0%, 1/01/21  
500,000  
531,765 
2012 Series B, 3.0%, 1/01/24  
1,000,000  
1,019,200 
2015 Series A-2, 5.0%, 1/01/24  
250,000  
270,995 
2016 Series C 
 
 
4.0%, 1/01/19  
880,000  
884,611 
5.0%, 1/01/35  
480,000  
535,795 
Nebraska State Colleges, Facilities Corp., Deferred 
 
 
Maintenance Revenue, Refunding, Series 2016, 
 
 
AGM Insured, 4.0%, 7/15/28  
750,000  
796,883 
Nebraska State Colleges, Student Fees and Facilities 
 
 
Revenue, Wayne State College Project, Series 2016, 
 
 
3.0%, 7/01/19  
120,000  
120,812 
North Platte, Sewer System Revenue, Refunding, 
 
 
Series 2015, 3.0%, 6/15/24  
250,000  
251,570 
Omaha-Douglas County, General Obligation, Public 
 
 
Building Commission, Series 2014, 5.0%, 5/01/26  
725,000  
790,076 
Omaha, General Obligation, Refunding,  
 
 
Series 2008 
 
 
5.0%, 6/01/20  
255,000  
255,640 
5.25%, 10/15/19, Pre-Refunded 10/15/18 @ 100  
250,000  
250,320 
Series 2012B, 3.0%, 11/15/24  
400,000  
410,464 
Various Purpose and Refunding, Series 2016A  
4.0%, 4/15/22  
815,000  
866,638 
4.0%, 4/15/23  
185,000  
199,134 
Omaha, Public Facilities Corp., Lease Revenue, 
 
 
Omaha Baseball Stadium Project 
 
 
Refunding, Series 2016A, 4.0%. 6/01/28  
1,335,000  
1,423,871 
Series 2009 
 
 
4.125%, 6/01/25, Pre-Refunded 6/01/19 @ 100  
250,000  
253,598 
5.0%, 6/01/23, Pre-Refunded 6/01/19 @ 100  
770,000  
785,500 
Series 2010, 4.125%, 6/01/29(b)  
650,000  
665,275 
Omaha Public Power District, 
 
 
Electric System Revenue 
 
 
2012 Series A, 5.0%, 2/01/24, Pre-Refunded 
 
 
2/01/22 @ 100  
2,000,000  
2,187,600 
2015 Series A, 2.85%, 2/01/27  
500,000  
499,990 
Separate Electric System Revenue  
 
 
2015 Series A, 5.0%, 2/01/19  
500,000  
504,950 
Omaha, Sanitary Sewerage System Revenue, 
 
 
Refunding, Series 2016 
 
 
5.0%, 4/01/26  
250,000  
290,448 
4.0%, 4/01/31  
350,000  
367,343 
Series 2014, 5.0%, 11/15/22  
200,000  
221,518 
Papillion, General Obligation, Tax Supported Recreational 
 
 
Facilities, Series 2017, 3.0%, 9/15/24  
420,000  
427,778 
Papillion-La Vista, General Obligation, Sarpy County  
 
 
School District #27, 
 
 
Refunding, Series 2017A 
 
 
2.05%, 12/01/24  
150,000  
144,831 
2.2%, 12/01/25  
150,000  
145,118 
2.3%, 12/01/26  
275,000  
263,467 
Series 2009, 5.0%, 12/01/28, Pre-Refunded 12/01/18 @ 100 500,000  
502,615 
 
 
     
 
$ Principal 
 
 
Amount  
$ Value 
 
Papio-Missouri River Natural Resources District, General 
 
 
Obligation, Flood Protection and Water Quality Enhancement,  
Refunding, Series 2017, 5.0%, 12/15/26  
185,000  
201,663 
Series 2015 
 
 
2.0%, 12/15/20  
100,000  
99,614 
2.25%, 12/15/21  
100,000  
99,386 
4.0%, 12/15/24  
100,000  
102,736 
4.0%, 12/15/25  
100,000  
102,685 
Public Power Generation Agency, Revenue, Refunding, 
 
 
Whelan Energy Center Unit 2, 2015 Series A, 5.0%, 1/01/28 200,000  
223,106 
Sarpy County, General Obligation, Bellevue Public School 
 
 
District 0001, Series 2017 
 
 
5.0%, 12/15/27  
250,000  
293,168 
5.0%, 12/15/29  
550,000  
642,681 
Sarpy County, Certificates of Participation,  
Series 2016, 1.75%, 6/15/26  
500,000  
456,350 
Sarpy County, Recovery Zone Facility Certificates of 
 
 
Participation, Series 2010 
 
 
2.35%, 12/15/18  
155,000  
155,152 
2.6%, 12/15/19  
135,000  
135,988 
South Sioux City, Combined Electric, Water and Sewer Revenue,  
Refunding, Series 2014A 
 
 
1.9%, 6/01/20  
280,000  
279,815 
2.25%, 6/01/21  
250,000  
250,520 
Southeast Community College Area, Certificates of 
 
 
Participation, Series 2018, 3.0%, 12/15/22  
400,000  
410,824 
Thayer County, General Obligation Hospital, Refunding, 
 
 
Series 2017, 1.3%, 9/01/20  
400,000  
389,396 
University of Nebraska, Facilities Corp.,  
 
 
Lease Rental Revenue, NCTA Education Center/Student  
Housing Project, Series 2011, 3.75% 6/15/19  
285,000  
288,637 
Revenue, Refunding, Health Center and College of 
 
 
Nursing Projects, Series 2016, 5.0%, 7/15/29  
380,000  
440,120 
Revenue, UNMC Global Center Project, Series 2017,  
5.0%, 12/15/18  
1,000,000  
1,006,330 
University of Nebraska, University Revenue,  
Kearney Student Housing Project, Series 2017 
 
 
3.0%, 7/01/25  
100,000  
102,085 
2.5%, 7/01/26  
210,000  
204,431 
3.0%, 7/01/27  
100,000  
100,457 
Lincoln Student Fees and Facilities 
 
 
Refunding, Series 2012, 5.0%, 7/01/23  
750,000  
824,828 
Series 2015A, 2.0%, 7/01/19  
600,000  
600,084 
Refunding, Omaha Student Housing Project, 
 
 
Series 2017A, 5.0%, 5/15/30  
100,000  
116,632 
Series 2017B, 5.0%, 5/15/30  
725,000  
845,582 
Upper Republican Natural Resources District, Limited 
 
 
Obligation Occupation Tax, River Flow Enhancement, 
 
 
Refunding, Series 2017B, AGM Insured 
 
 
4.0%, 12/15/25  
245,000  
258,098 
4.0%, 12/15/27  
395,000  
413,865 
Village of Boys Town, Revenue, Refunding, Boys Town 
 
 
Project, Series 2017, 3.0%, 9/01/28  
700,000  
697,606 
Washington County, General Obligation, Refunding, 
 
 
Blair Community School District 0001, Series 2015, 
 
 
2.5%, 12/15/24  
305,000  
304,994 
 
49,511,673 
 
The accompanying notes form an integral part of these financial statements.
 
43  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
NEBRASKA TAX-FREE INCOME FUND (CONTINUED)
 
     
 
$ Principal 
 
 
% of Net  
Amount 
 
 
Assets  
or Shares  
$ Value 
 
Texas  
3.2 
 
 
Angelina County Junior College District, Limited 
 
 
Tax General Obligation, Series 2009, AGM Insured, 
 
 
4.25%, 2/15/23  
250,000  
252,203 
Austin, Airport System Revenue, Series 2017B, 
 
 
AMT, 5.0%, 11/15/26  
250,000  
285,400 
El Paso International Airport, Revenue, Series 2018, 
 
 
AMT, 5.0%, 8/15/20  
500,000  
525,395 
Harris County, Tax and Subordinate Lien Revenue,  
Refunding, Series 2009C, 5.0%, 8/15/23  
110,000  
112,905 
Houston, General Obligation, Public Improvement,  
Refunding, Series 2014A, 5.0%, 3/01/26  
500,000  
559,420 
 
1,735,323 
Washington  
0.4 
 
 
Port of Seattle, Intermediate Lien Revenue, 
 
 
 
Series 2017C, AMT, 5.0%, 5/01/26  
200,000  
227,956 
Total Municipal Bonds (Cost $54,914,836)  
 
54,052,723 
 
Cash Equivalents – 0.4% 
 
 
 
 
State Street Institutional U.S. Government Money 
 
 
Market Fund - Premier Class 1.97%(a)  
236,754  
236,754 
Total Cash Equivalents (Cost $236,754)  
 
236,754 
Total Investments in Securities (Cost $55,151,590)  
 
54,289,477 
Other Liabilities in Excess of Other Assets - (0.0%)  
(10,875) 
Net Assets - 100%  
 
 
54,278,602 
Net Asset Value Per Share  
9.70 
 
(a)     
Rate presented represents the annualized 7-day yield at September 30, 2018.
(b)     
Annual sinking fund
(c) Security designated to cover an unsettled bond purchase.
 
The accompanying notes form an integral part of these financial statements.

44  |  Q3 2018 SEMI-ANNUAL REPORT

 
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45   |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
STATEMENTS OF ASSETS AND LIABILITIES
September 30, 2018
 
(In U.S. dollars,
except share data)
Value  
Partners  
Value  
Partners III  
Opportunity  
Hickory 
Balanced 
Core Plus 
Income 
Short 
Duration 
Income 
Ultra Short 
Government 
Nebraska 
Tax-Free 
Income 
Assets: 
 
 
 
 
 
 
 
 
 
Investments in securities at value: 
 
 
 
 
 
 
 
 
 
Unaffiliated issuers(a) 
820,137,933  
656,200,265  
625,010,711  
235,768,280  
122,505,398  
53,121,824  
976,651,690  
107,697,624  
54,289,477 
Controlled affiliates(a)  
 
 
23,993,900  
 
 
 
 
 
 
 
820,137,933  
656,200,265  
649,004,611  
235,768,280  
122,505,398  
53,121,824  
976,651,690  
107,697,624  
54,289,477 
Accrued interest and dividends receivable  
397,278  
135,132  
262,963  
168,431  
495,513  
343,695  
5,710,999  
521,888  
583,037 
Due from broker  
 
 
201,100,310  
 
 
 
 
 
 
Receivable for fund shares sold  
117,855  
3,772  
339  
1,571  
 
 
547,067  
 
 
Total assets  
820,653,066  
656,339,169  
850,368,223  
235,938,282  
123,000,911  
53,465,519  
982,909,756  
108,219,512  
54,872,514 
Liabilities: 
 
 
 
 
 
 
 
 
 
Dividends payable on securities sold short  
 
 
740,409  
 
 
 
 
 
 
Due to adviser  
899,354  
690,906  
687,612  
277,737  
85,697  
18,694  
410,165  
17,521  
67,192 
Options written, at value(b)  
 
 
723,500  
 
 
 
 
 
 
Payable for securities purchased  
2,243,925  
1,997,800  
 
 
332,197  
 
 
 
526,720 
Payable for fund shares redeemed  
203,537  
50,751  
131,998  
384,688  
4,173  
 
1,498,670  
50,000  
 
Securities sold short(c)  
 
 
194,474,000  
 
 
 
 
 
 
Other  
 
 
 
3,713  
 
 
 
25,051  
 
Total liabilities  
3,346,816  
2,739,457  
196,757,519  
666,138  
422,067  
18,694  
1,908,835  
92,572  
593,912 
Net assets  
817,306,250  
653,599,712  
653,610,704  
235,272,144  
122,578,844  
53,446,825  
981,000,921  
108,126,940  
54,278,602 
Composition of net assets: 
 
 
 
 
 
 
 
 
 
Paid-in capital  
484,494,843  
386,776,160  
421,560,695  
145,148,703  
102,218,769  
54,208,688  
989,165,534  
108,159,186  
55,202,189 
Accumulated undistributed net investment income (loss)
(2,216,034)  
(941,229)  
(2,736,754)  
(425,211)  
568,521  
13,859  
290,301  
1,610  
3,205 
Accumulated net realized gain (loss)
33,283,573  
41,774,091  
10,412,164  
12,486,542  
2,724,005  
(26,650)  
(1,346,248)  
(6,850)  
(64,679) 
Net unrealized appreciation (depreciation) of investments
301,743,868  
225,990,690  
224,374,599  
78,062,110  
17,067,549  
(749,072)  
(7,108,666)  
(27,006)  
(862,113) 
Net assets  
817,306,250  
653,599,712  
653,610,704  
235,272,144  
122,578,844  
53,446,825  
981,000,921  
108,126,940  
54,278,602 
Net assets(d): 
 
 
 
 
 
 
 
 
 
Investor Class  
590,055,018  
310,831,595  
21,772,390  
235,272,144  
122,578,844  
8,393,059  
102,037,337  
54,278,602 
Institutional Class  
227,251,232  
342,768,117  
631,838,314  
45,053,766  
878,963,584  
108,126,940  
 
Shares outstanding(d)(e): 
 
 
 
 
 
 
 
 
 
Investor Class  
13,306,567  
9,617,663  
1,546,634  
4,591,708  
8,719,764  
837,625  
8,474,902  
5,596,869 
Institutional Class  
5,073,529  
10,498,774  
43,427,656  
4,495,656  
72,868,544  
10,815,939  
 
Net asset value, offering and redemption price(d): 
 
 
 
 
 
 
 
 
 
Investor Class  
44.34  
32.32  
14.08  
51.24  
14.06  
10.02  
12.04  
9.70 
Institutional Class  
44.79  
32.65  
14.55  
10.02  
12.06  
10.00  
 
 
(a) Cost of investments in securities: 
 
 
 
 
 
 
 
 
 
Unaffiliated issuers  
518,394,065  
430,209,575  
359,777,765  
157,706,170  
105,437,849  
53,870,896  
983,760,356  
107,724,630  
55,151,590 
Controlled affiliates  
 
 
2,899,379  
 
 
 
 
 
 
 
518,394,065  
430,209,575  
362,677,144  
157,706,170  
105,437,849  
53,870,896  
983,760,356  
107,724,630  
55,151,590 
(b) Premiums from options written  
 
 
549,466  
 
 
 
 
 
 
(c) Proceeds from short sales  
 
 
132,695,166  
 
 
 
 
 
 
(d) Funds with a single share class are shown with the Investor Class, except for the Ultra Short Government Fund which has been designated Institutional Class
(e) Indefinite number of no par value shares authorized
 
The accompanying notes form an integral part of these financial statements.

46  |  Q3 2018 SEMI-ANNUAL REPORT

 
STATEMENTS OF OPERATIONS
Six months ended September 30, 2018
 
 
 
(In U.S. dollars)
Value  
Partners  
Value  
Partners III  
Opportunity  
Hickory 
Balanced 
Core Plus 
Income 
Short 
Duration 
Income 
Ultra Short 
Government 
Nebraska 
Tax-Free 
Income 
Investment income: 
 
 
 
 
 
 
 
 
 
Dividends: 
 
 
 
 
 
 
 
 
 
Unaffiliated issuers(a)  
2,410,336  
2,390,477  
1,970,250  
876,225  
391,781  
8,910  
238,500  
 
 
Interest  
754,252  
696,928  
1,513,381  
426,728  
742,070  
747,213  
14,507,179  
1,056,131  
657,114 
Total investment income  
3,164,588  
3,087,405  
3,483,631  
1,302,953  
1,133,851  
756,123  
14,745,679  
1,056,131  
657,114 
Fees and expenses: 
 
 
 
 
 
 
 
 
 
Investment advisory  
3,604,997  
2,932,764  
3,256,678  
1,194,421  
420,877  
94,616  
2,113,290  
158,404  
115,339 
Administrative  
260,496  
230,619  
203,422  
167,981  
99,292  
49,267  
307,291  
66,323  
55,498 
Shareholder servicing: 
 
 
 
 
 
 
 
 
 
Investor Class  
520,575  
326,119  
31,455  
 
 
5,093  
153,476  
 
 
Institutional Class  
19,050  
43,996  
107,781  
 
 
10,377  
496,212  
5,280  
 
Custody and fund accounting  
55,698  
46,099  
52,545  
29,878  
37,648  
39,601  
88,279  
33,038  
37,800 
Dividends on securities sold short  
 
 
1,476,704  
 
 
 
 
 
 
Professional  
41,257  
39,165  
38,743  
22,313  
17,110  
15,470  
58,465  
16,357  
14,471 
Registration  
21,300  
23,450  
23,930  
11,552  
11,100  
17,950  
35,800  
11,900  
2,739 
Sub-transfer agent  
103,614  
58,462  
44,713  
43,395  
19,408  
21,726  
55,368  
16,322  
12,149 
Trustees  
43,936  
35,405  
35,527  
12,907  
6,736  
2,673  
58,170  
5,740  
3,062 
Other  
67,786  
45,779  
38,497  
20,820  
8,674  
3,705  
94,041  
7,568  
3,894 
 
4,738,709  
3,781,858  
5,309,995  
1,503,267  
620,845  
260,478  
3,460,392  
320,932  
244,952 
Less expenses waived/reimbursed by investment adviser
(95,627)  
(124,432)  
 
 
(56,239)  
(158,403)  
(816,349)  
(215,330)  
 
Net expenses  
4,643,082  
3,657,426  
5,309,995  
1,503,267  
564,606  
102,075  
2,644,043  
105,602  
244,952 
Net investment income (loss)  
(1,478,494)  
(570,021)  
(1,826,364)  
(200,314)  
569,245  
654,048  
12,101,636  
950,529  
412,162 
Realized and unrealized gain 
 
 
 
 
 
 
 
 
 
(loss) on investments: 
 
 
 
 
 
 
 
 
 
Net realized gain (loss): 
 
 
 
 
 
 
 
 
 
Unaffiliated issuers  
33,287,792  
41,777,253  
15,625,041  
12,488,081  
2,725,622  
(502)  
1,960,627  
(4,843)  
8,587 
Options written  
 
 
430,051  
 
 
 
 
 
 
Securities sold short  
 
 
(5,632,126)  
 
 
 
 
 
 
Net realized gain (loss)  
33,287,792  
41,777,253  
10,422,966  
12,488,081  
2,725,622  
(502)  
1,960,627  
(4,843)  
8,587 
Net unrealized appreciation (depreciation): 
 
 
 
 
 
 
 
 
 
Unaffiliated issuers  
31,406,007  
(4,244,134)  
30,777,250  
(1,957,806)  
1,483,698  
(366,013)  
(5,669,399)  
11,028  
(307,145) 
Controlled affiliates  
 
 
12,394,200  
 
 
 
 
 
 
Options written  
 
 
(439,219)  
 
 
 
 
 
 
Securities sold short  
 
 
(16,489,027)  
 
 
 
 
 
 
Net unrealized appreciation (depreciation)  
31,406,007  
(4,244,134)  
26,243,204  
(1,957,806)  
1,483,698  
(366,013)  
(5,669,399)  
11,028  
(307,145) 
Net realized and unrealized gain (loss) on investments
64,693,799  
37,533,119  
36,666,170  
10,530,275  
4,209,320  
(366,515)  
(3,708,772)  
6,185  
(298,558) 
Net increase (decrease) in net assets resulting 
 
 
 
 
 
 
 
 
 
from operations  
63,215,305  
36,963,098  
34,839,806  
10,329,961  
4,778,565  
287,533  
8,392,864  
956,714  
113,604 
 
(a) Foreign taxes withheld  
 
 
 
7,425  
5,475  
 
 
 
 

 
The accompanying notes form an integral part of these financial statements.
47   |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
STATEMENTS OF CHANGES IN NET ASSETS
 
 
Value 
 
Partners Value 
Partners III Opportunity 
 
Hickory 
 
Six months 
 
Six months 
 
Six months 
 
Six months 
 
 
ended 
 
ended 
 
ended 
 
ended 
 
 
Sept. 30, 2018 
Year ended 
Sept. 30, 2018 
Year ended 
Sept. 30, 2018 
Year ended 
Sept. 30, 2018 
Year ended 
(In U.S. dollars) 
(Unaudited) 
 March 31, 2018 
(Unaudited) 
 March 31, 2018 
(Unaudited) 
 March 31, 2018 
(Unaudited)  
 March 31, 2018 
Increase (decrease) in net assets: 
 
 
 
 
 
 
 
 
From operations: 
 
 
 
 
 
 
 
 
Net investment income (loss) 
(1,478,494) 
(3,008,861) 
(570,021) 
(2,419,845) 
(1,826,364) 
(5,545,655) 
(200,314) 
(1,731,750) 
Net realized gain (loss) 
33,287,792 
62,971,261 
41,777,253 
35,922,927 
10,422,966 
47,907,638 
12,488,081 
23,837,210 
Net unrealized appreciation 
 
 
 
 
 
 
 
 
  (depreciation) 
31,406,007 
13,403,481 
(4,244,134) 
(1,698,449) 
26,243,204 
(28,886,726) 
(1,957,806) 
(15,569,568) 
Net increase (decrease) 
 
 
 
 
 
 
 
 
in net assets resulting 
 
 
 
 
 
 
 
 
from operations 
63,215,305 
73,365,881 
36,963,098 
31,804,633 
34,839,806 
13,475,257 
10,329,961 
6,535,892 
Distributions to shareholders from: 
 
 
 
 
 
 
 
 
Net investment income(a): 
 
 
 
 
 
 
 
 
Investor Class 
 
 
 
 
 
 
 
 
Institutional Class 
 
 
 
 
 
 
 
 
Net realized gains(a): 
 
 
 
 
 
 
 
 
Investor Class 
(25,563,496) 
(43,230,191) 
(7,655,063) 
(8,283,431) 
(1,414,598) 
(1,237,322) 
(11,702,247) 
(12,830,462) 
Institutional Class 
(9,634,453) 
(14,133,559) 
(7,950,425) 
(7,418,949) 
(37,974,023) 
(28,992,835) 
 
 
Total distributions 
(35,197,949) 
(57,363,750) 
(15,605,488) 
(15,702,380) 
(39,388,621) 
(30,230,157) 
(11,702,247) 
(12,830,462) 
Fund share transactions(a): 
 
 
 
 
 
 
 
 
Investor Class 
(8,428,364) 
(72,382,271) 
(27,961,601) 
(109,960,340) 
(2,767,648) 
(2,909,506) 
(5,963,645) 
(23,596,529) 
 Institutional Class 
12,313,402 
11,492,448 
81,762 
15,256,368 
7,085,778 
(16,220,456) 
 
 
Net increase (decrease) from 
 
 
 
 
 
 
 
 
fund share transactions 
3,885,038 
(60,889,823) 
(27,879,839) 
(94,703,972) 
4,318,130 
(19,129,962) 
(5,963,645) 
(23,596,529) 
Total increase (decrease) in 
 
 
 
 
 
 
 
 
net assets 
31,902,394 
(44,887,692) 
(6,522,229) 
(78,601,719) 
(230,685) 
(35,884,862) 
(7,335,931) 
(29,891,099) 
Net assets: 
 
 
 
 
 
 
 
 
Beginning of period 
785,403,856 
830,291,548 
660,121,941 
738,723,660 
653,841,389 
689,726,251 
242,608,075 
272,499,174 
End of period 
817,306,250 
785,403,856 
653,599,712 
660,121,941 
653,610,704 
653,841,389 
235,272,144 
242,608,075 
Undistributed net investment 
 
 
 
 
 
 
 
 
income (loss) 
(2,216,034) 
(737,540) 
(941,229) 
(371,208) 
(2,736,754) 
(910,390) 
(425,211) 
(224,897) 
 
(a) Funds with a single share class are shown with the Investor Class, except for the Ultra Short Government Fund which has been designated Institutional Class 
 
The accompanying notes form an integral part of these financial statements.

48  |  Q3 2018 SEMI-ANNUAL REPORT


 
                   
 
 
 
 
 
Short Duration 
 
Ultra Short 
 
Nebraska 
 
Balanced 
Core Plus Income 
 
Income 
 
Government 
Tax-Free Income 
Six months 
 
Six months 
 
Six months 
 
Six months 
 
Six months 
 
ended 
 
ended 
 
ended 
 
ended 
 
ended 
 
Sept. 30, 2018 
Year ended 
Sept. 30, 2018 
Year ended 
Sept. 30, 2018 
Year ended 
Sept. 30, 2018 
Year ended 
Sept. 30, 2018 
Year ended 
(Unaudited)
 March 31, 2018 
(Unaudited)
 March 31, 2018 
(Unaudited)
 March 31, 2018 
(Unaudited) 
  March 31, 2018 
(Unaudited) 
  March 31, 2018 
569,245 
671,396 
654,048 
931,498 
12,101,636 
25,078,748 
950,529 
940,684 
412,162 
862,206 
2,725,622 
7,257,714 
(502) 
(6,975) 
1,960,627 
1,415,995 
(4,843) 
(228) 
8,587 
(34,006) 
1,483,698 
356,714 
(366,013) 
(493,281) 
(5,669,399) 
(18,992,174) 
11,028 
(2,236) 
(307,145) 
(846,001) 
 
4,778,565 
8,285,824 
287,533 
431,242 
8,392,864 
7,502,569 
956,714 
938,220 
113,604 
(17,801) 
 
(221,962) 
(452,372) 
(101,986) 
(157,148) 
(1,188,542) 
(2,045,826) 
 
 
(454,817) 
(818,694) 
 
 
(568,809) 
(748,946) 
(11,173,403) 
(22,624,511) 
(950,529) 
(940,684) 
 
 
(5,681,039) 
(2,851,555) 
 
(21,045) 
 
 
 
 
 
 
 
 
 
(85,223) 
 
 
 
 
 
 
(5,903,001) 
(3,303,927) 
(670,795) 
(1,012,362) 
(12,361,945) 
(24,670,337) 
(950,529) 
(940,684) 
(454,817) 
(818,694) 
1,634,090 
(1,101,597) 
1,182,040 
851,560 
(10,774,412) 
20,043,162 
 
 
(3,984,116) 
(3,532,391) 
 
 
13,479,713 
8,522,073 
(135,455,691) 
(69,764,710) 
3,958,778 
6,135,346 
 
 
 
1,634,090 
(1,101,597) 
14,661,753 
9,373,633 
(146,230,103) 
(49,721,548) 
3,958,778 
6,135,346 
(3,984,116) 
(3,532,391) 
509,654 
3,880,300 
14,278,491 
8,792,513 
(150,199,184) 
(66,889,316) 
3,964,963 
6,132,882 
(4,325,329) 
(4,368,886) 
122,069,190 
118,188,890 
39,168,334 
30,375,821 
1,131,200,105 
1,198,089,421 
104,161,977 
98,029,095 
58,603,931 
62,972,817 
122,578,844 
122,069,190 
53,446,825 
39,168,334 
981,000,921 
1,131,200,105 
108,126,940 
104,161,977 
54,278,602 
58,603,931 
                   
568,521 
221,238 
13,859 
30,606 
290,301 
550,610 
1,610 
1,610 
3,205 
45,860 
 
The accompanying notes form an integral part of these financial statements.
49  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
STATEMENT OF CASH FLOWS
Partners III Opportunity
Six months ended September 30, 2018
(In U.S. dollars) 
 
 
Increase (decrease) in cash: 
 
 
 
Cash flows from operating activities: 
 
 
 
Net increase in net assets from operations  
 
34,839,806 
 
Adjustments to reconcile net increase in net assets from operations to net cash provided by operating activities: 
 
 
Purchases of investment securities  
 
(85,781,122) 
 
Proceeds from sale of investment securities  
 
104,003,231 
 
Short positions covered  
 
(15,267,653) 
 
Sale of short-term investment securities, net  
 
28,086,919 
 
Net unrealized appreciation on investments, options and short sales  
(26,243,204) 
 
Net realized gain on investments, options and short sales  
(10,422,966) 
 
Increase in accrued interest and dividends receivable  
 
(96,616) 
 
Decrease in due from broker  
 
6,660,457 
 
Decrease in receivable for fund shares sold  
 
38,825 
 
Increase in dividends payable on securities sold short  
 
88,315 
 
Decrease in due to adviser  
 
(21,561) 
 
Decrease in payable for securities purchased  
 
(891,731) 
 
Increase in payable for fund shares redeemed  
 
77,791 
Net cash provided by operating activities  
 
35,070,491 
 
Cash flows from financing activities: 
 
 
 
Proceeds from sales of fund shares  
 
10,685,179 
 
Payments for redemptions of fund shares  
 
(44,634,969) 
 
Cash distributions to shareholders  
 
(1,120,701) 
Net cash used in financing activities  
 
(35,070,491) 
 
Net increase (decrease) in cash  
 
 
Cash: 
 
 
 
Balance, beginning of period  
 
 
 
Balance, end of period  
 
 
Noncash financing activities: 
 
 
Reinvestment of shareholder distributions  
 
38,267,920 
 
The accompanying notes form an integral part of these financial statements.

50  |  Q3 2018 SEMI-ANNUAL REPORT




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51  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
FINANCIAL HIGHLIGHTS
The following financial information provides selected data, in U.S. dollars, for a share outstanding throughout the periods indicated.
 
 
Income (loss) from Investment Operations  
Distributions
 
Net gain (loss)  
 
Dividends  
   
 
on securities  
Total from  
from net  
Distributions  
 
Years ended March 31,  
Net asset value,  
 Net investment  
(realized  
investment  
investment  
from  
Total  
unless otherwise noted  
beginning of period  
income (loss)  
and unrealized)  
operations  
income  
realized gains  
distributions  
 
Value - Investor Class 
 
 
 
 
 
 
 
Six months ended 9/30/2018  
42.92  
(0.09)(a)  
3.49  
3.40  
 
(1.98)  
(1.98)  
2018  
42.20  
(0.18)(a)  
3.96  
3.78  
 
(3.06)  
(3.06)  
2017  
38.43  
(0.16)(a)  
3.93  
3.77  
 
 
 
2016  
46.93  
(0.25)(a)  
(3.27)  
(3.52)  
 
(4.98)  
(4.98)  
2015  
46.20  
(0.24)(a)  
4.76  
4.52  
 
(3.79)  
(3.79)  
 2014  
38.61  
         (0.17)     
7.76  
7.59  
 
 
 
 
Value - Institutional Class 
 
 
 
 
 
 
 
Six months ended 9/30/2018  
43.29  
(0.04)(a)  
3.52  
3.48  
 
(1.98)  
(1.98)  
2018  
42.44  
(0.09)(a)  
4.00  
3.91  
 
(3.06)  
(3.06)  
2017  
38.56  
(0.08)(a)  
3.96  
3.88  
 
 
 
2016  
46.99  
(0.17)(a)  
(3.28)  
(3.45)  
 
(4.98)  
(4.98)  
 Eight months ended 3/31/2015(b)  
44.80  
         (0.26)(a)  
4.50  
4.24  
 
(2.05)  
(2.05)  
 
Partners Value - Investor Class 
 
 
 
 
 
 
 
Six months ended 9/30/2018  
31.31  
(0.05)(a)  
1.83  
1.78  
 
(0.77)  
(0.77)  
2018  
30.72  
(0.15)(a)  
1.47  
1.32  
 
(0.73)  
(0.73)  
2017  
27.66  
(0.09)(a)  
3.15  
3.06  
 
 
 
2016  
35.05  
(0.14)(a)  
(3.47)  
(3.61)  
 
(3.78)  
(3.78)  
2015  
33.20  
(0.14)(a)  
3.09  
2.95  
 
(1.10)  
(1.10)  
 2014  
27.75  
         (0.14)    
5.59  
5.45  
 
 
 
 
Partners Value - Institutional Class 
 
 
 
 
 
 
 
Six months ended 9/30/2018  
31.59  
(0.01)(a)  
1.84  
1.83  
 
(0.77)  
(0.77)  
2018  
30.91  
(0.06)(a)  
1.47  
1.41  
 
(0.73)  
(0.73)  
2017  
27.75  
(0.02)(a)  
3.18  
3.16  
 
 
 
2016  
35.09  
(0.08)(a)  
(3.48)  
(3.56)  
 
(3.78)  
(3.78)  
 Eight months ended 3/31/2015(b)  
33.22  
         (0.11)(a)  
2.91  
2.80  
 
(0.93)  
(0.93)  
 
Partners III Opportunity - Investor Class 
 
 
 
 
 
 
Six months ended 9/30/2018  
14.28  
(0.08)(a)  
0.80  
0.72  
 
(0.92)  
(0.92)  
2018  
14.74  
(0.19)(a)  
0.40  
0.21  
 
(0.67)  
(0.67)  
2017  
13.73  
(0.20)(a)  
1.40  
1.20  
 
(0.19)  
(0.19)  
2016  
17.12  
(0.25)(a)  
(1.30)  
(1.55)  
 
(1.84)  
(1.84)  
2015  
16.43  
(0.22)(a)  
1.41  
1.19  
 
(0.50)  
(0.50)  
 2014  
14.26  
         (0.17)(a)  
2.71  
2.54  
 
(0.37)  
(0.37)  
 
Partners III Opportunity - Institutional Class 
 
 
 
 
 
 
Six months ended 9/30/2018  
14.69  
(0.04)(a)  
0.82  
0.78  
 
(0.92)  
(0.92)  
2018  
15.07  
(0.12)(a)  
0.41  
0.29  
 
(0.67)  
(0.67)  
2017  
13.96  
(0.13)(a)  
1.43  
1.30  
 
(0.19)  
(0.19)  
2016  
17.31  
(0.19)(a)  
(1.32)  
(1.51)  
 
(1.84)  
(1.84)  
2015  
16.55  
(0.17)(a)  
1.43  
1.26  
 
(0.50)  
(0.50)  
    2014  
14.33  
         (0.12)(a)  
2.71  
2.59  
 
(0.37)  
(0.37)  
 
Hickory 
 
 
 
 
 
 
 
Six months ended 9/30/2018  
51.58  
(0.05)    
2.27  
2.22  
 
(2.56)  
(2.56)  
2018  
53.11  
(0.37)    
1.55  
1.18  
 
(2.71)  
(2.71)  
2017  
47.59  
(0.25)    
5.77  
5.52  
 
 
 
2016  
59.51  
(0.30)    
(4.79)  
(5.09)  
 
(6.83)  
(6.83)  
2015  
57.87  
(0.35)    
5.00  
4.65  
 
(3.01)  
(3.01)  
2014  
50.22  
(0.34)    
7.99  
7.65  
 
 
 
 
* Annualized
† Not Annualized
(a)  Based on average daily shares outstanding
(b)  Initial offering of shares on July 31, 2014
(c)  Included in the expense ratio is 0.00%, 0.00%, 0.08%, 0.27%, 0.24% and 0.11% related to interest expense and 0.44%, 0.47%, 0.54%, 0.50%, 0.29% and 0.16% related to dividend expense on securities sold short for the periods ended September 30, 2018, March 31, 2018, 2017, 2016, 2015 and 2014, respectively.
(d)  Included in the expense ratio is 0.00%, 0.00%, 0.08%, 0.27%, 0.24% and 0.12% related to interest expense and 0.45%, 0.47%, 0.55%, 0.51%, 0.29% and 0.15% related to dividend expense on securities sold short for the periods ended September 30, 2018, March 31, 2018, 2017, 2016, 2015 and 2014, respectively.
 
The accompanying notes form an integral part of these financial statements.
 
52  |  Q3 2018 SEMI-ANNUAL REPORT




 
Ratios/Supplemental Data 
 
 
 
Ratio of expenses 
 
 
 
 
 
to average net assets 
 
 
 
Ratio of net 
 
 
investment income  
Portfolio 
Net asset value,  
 
Net assets, end of  
Prior to fee  
Net of fee  
(loss) to average  
turnover 
end of period  
Total Return (%)  
period ($000)  
waivers (%)  
waivers (%)  
net assets (%)  
rate (%) 
 
44.34  
8.21†  
590,055  
1.22* 
1.22* 
(0.43)* 
12† 
42.92  
9.23    
578,345  
1.22  
1.22  
(0.42)  
15  
42.20  
9.81    
638,993  
1.24  
1.22  
(0.42)  
24  
38.43  
(8.05)   
738,086  
1.23  
1.18  
(0.59)  
47  
46.93  
10.19    
940,646  
1.20  
1.18  
(0.54)  
36  
46.20  
19.66    
1,167,282  
1.18  
1.18  
(0.41)  
19  
 
 
44.79  
8.36†  
227,251  
1.08* 
0.99* 
(0.20)* 
12† 
43.29  
9.46    
207,059  
1.09  
0.99  
(0.20)  
15  
42.44  
10.06    
191,299  
1.10  
0.99  
(0.19)  
24  
38.56  
(7.88)   
192,310  
1.08  
0.99  
(0.39)  
47  
46.99  
9.57†  
200,254  
1.08* 
0.99* 
(0.87)* 
36  
 
 
32.32  
5.83†  
310,832  
1.26* 
1.26* 
(0.31)* 
18† 
31.31  
4.28    
328,648  
1.25  
1.25  
(0.46)  
12  
30.72  
11.06    
429,226  
1.27  
1.24  
(0.33)  
16  
27.66  
(10.61)  
531,353  
1.26  
1.18  
(0.45)  
31  
35.05  
8.99   
789,853  
1.22  
1.18  
(0.42)  
26  
33.20  
19.64   
1,074,499  
1.18  
1.18  
(0.46)  
19  
 
 
32.65  
5.94†  
342,768  
1.06* 
0.99* 
(0.04)* 
18† 
31.59  
4.55   
331,474  
1.07  
0.99  
(0.20)  
12  
30.91  
11.39   
309,497  
1.07  
0.99  
(0.08)  
16  
27.75  
(10.45)  
297,290  
1.07  
0.99  
(0.25)  
31  
35.09  
8.51†  
317,973  
1.05*  
0.99* 
(0.49)* 
26  
 
 
14.08  
5.30† 
21,772  
2.17*(c) 
2.17*(c) 
(1.11)* 
16† 
14.28  
1.49   
24,808  
2.14(c)  
2.14(c)  
(1.30)  
31  
14.74  
8.94   
28,561  
2.29(c)  
2.29(c)  
(1.43)  
23  
13.73  
(9.56)  
35,461  
2.33(c)  
2.33(c)  
(1.63)  
46  
17.12  
7.38   
68,490  
2.06(c)  
2.01(c)  
(1.33)  
45  
16.43  
17.94   
78,586  
1.84(c)  
1.68(c)  
(1.10)  
20  
 
 
14.55  
5.57†  
631,838  
1.61*(d) 
1.61*(d) 
(0.54)* 
16† 
14.69  
2.01   
629,034  
1.63(d)  
1.63(d)  
(0.79)  
31  
15.07  
9.52   
661,165  
1.80(d)  
1.80(d)  
(0.93)  
23  
13.96  
(9.20)  
677,019  
1.95(d)  
1.95(d)  
(1.26)  
46  
17.31  
7.76   
1,014,821  
1.69(d)  
1.69(d)  
(1.00)  
45  
16.55  
18.20   
1,163,661  
1.43(d)  
1.43(d)  
(0.78)  
20  
 
 
51.24  
4.46†  
235,272  
1.26* 
1.26* 
(0.17)* 
10† 
51.58  
2.15   
242,608  
1.24  
1.24  
(0.65)  
20  
53.11  
11.60   
272,499  
1.25  
1.25  
(0.44)  
7  
47.59  
(9.04)  
298,170  
1.24  
1.24  
(0.50)  
27  
59.51  
8.31   
445,167  
1.23  
1.23  
(0.54)  
26  
57.87  
15.23   
517,640  
1.22  
1.22  
(0.62)  
30  
 
The accompanying notes form an integral part of these financial statements.
 
53  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED


 
FINANCIAL HIGHLIGHTS (CONTINUED)
The following financial information provides selected data, in U.S. dollars, for a share outstanding throughout the periods indicated.
 
 
Income (loss) from Investment Operations  
 
Distributions  
 
 
Net gain (loss)  
 
Dividends  
   
 
on securities  
Total from  
from net  
Distributions  
 
Years ended March 31,  
Net asset value,   
 Net investment  
(realized  
investment  
investment  
from  
Total  
unless otherwise noted  
beginning of period  
income (loss)  
and unrealized)  
operations  
income  
realized gains  
distributions  
 
Balanced 
 
 
 
 
 
 
 
Six months ended 9/30/2018  
14.20  
0.07  
0.48  
0.55  
(0.03)  
(0.66)  
(0.69)  
2018  
13.63  
0.08  
0.87  
0.95  
(0.05)  
(0.33)  
(0.38)  
2017  
13.24  
0.01  
0.80  
0.81  
(0.03)  
(0.39)  
(0.42)  
2016  
14.07  
0.02  
(0.13) 
(0.11) 
 
(0.72)  
(0.72)  
2015  
14.22  
(0.02) 
0.54  
0.52  
 
(0.67)  
(0.67)  
2014  
13.58  
(0.03) 
1.34  
1.31  
—#
(0.67)  
(0.67)  
 
Core Plus Income-Investor Class 
 
 
 
 
 
 
 
Six months ended 9/30/2018  
10.09  
0.13(a) 
(0.07) 
0.06  
(0.13)  
 
(0.13)  
2018  
10.23  
0.23(a) 
(0.12) 
0.11  
(0.22)  
(0.03)  
(0.25)  
2017  
10.15  
0.23(a) 
0.21  
0.44  
(0.23)  
(0.13)  
(0.36)  
2016  
10.21  
0.22(a) 
(0.04) 
0.18  
(0.22)  
(0.02)  
(0.24)  
Eight months ended 3/31/2015(b)  
10.00  
0.09(a) 
0.20  
0.29  
(0.08)  
 
(0.08)  
 
Core Plus Income-Institutional Class 
 
 
 
 
 
 
Six months ended 9/30/2018  
10.10  
0.14(a) 
(0.08) 
0.06  
(0.14)  
 
(0.14)  
2018  
10.23  
0.25(a) 
(0.11) 
0.14  
(0.24)  
(0.03)  
(0.27)  
2017  
10.15  
0.25(a) 
0.21  
0.46  
(0.25)  
(0.13)  
(0.38)  
2016  
10.20  
0.25(a) 
(0.04) 
0.21  
(0.24)  
(0.02)  
(0.26)  
Eight months ended 3/31/2015(b)  
10.00  
0.10(a) 
0.20  
0.30  
(0.10)  
 
(0.10)  
 
Short Duration Income-Investor Class 
 
 
 
 
 
 
Six months ended 9/30/2018  
12.09  
0.13(a) 
(0.04) 
0.09  
(0.14)  
 
(0.14)  
2018  
12.27  
0.23(a) 
(0.18) 
0.05  
(0.23)  
 
(0.23)  
2017  
12.28  
0.23(a) 
0.04  
0.27  
(0.24)(e)
(0.04)  
(0.28)  
2016  
12.48  
0.22(a) 
(0.15) 
0.07  
(0.23)  
(0.04)  
(0.27)  
2015  
12.49  
0.19(a) 
0.02  
0.21  
(0.21)  
(0.01)  
(0.22)  
2014  
12.67  
0.19(a) 
(0.15) 
0.04  
(0.22)  
 
(0.22)  
 
Short Duration Income-Institutional Class 
 
 
 
 
 
 
Six months ended 9/30/2018  
12.11  
0.14(a) 
(0.04) 
0.10  
(0.15)  
 
(0.15)  
2018  
12.29  
0.26(a) 
(0.18) 
0.08  
(0.26)  
 
(0.26)  
2017  
12.30  
0.26(a) 
0.04  
0.30  
(0.27)(e)
(0.04)  
(0.31)  
2016  
12.50  
0.25(a) 
(0.15) 
0.10  
(0.26)  
(0.04)  
(0.30)  
2015  
12.51  
0.22(a) 
0.02  
0.24  
(0.24)  
(0.01)  
(0.25)  
2014  
12.68  
0.22(a) 
(0.15) 
0.07  
(0.24)  
 
(0.24)  
 
Ultra Short Government(c) 
 
 
 
 
 
 
 
Six months ended 9/30/2018  
10.00  
0.09  
—# 
0.09  
(0.09)  
 
(0.09)  
2018  
10.00  
0.09  
—# 
0.09  
(0.09)  
 
(0.09)  
2017  
10.00  
0.03  
—# 
0.03  
(0.03)  
 
(0.03)  
2016  
10.00  
—# 
—# 
—# 
—# 
—# 
—#  
2015  
10.00  
—# 
—# 
—# 
—# 
 
—#  
2014  
10.00  
—# 
—# 
—# 
—# 
—# 
—#  
 
Nebraska Tax-Free Income 
 
 
 
 
 
 
 
Six months ended 9/30/18  
9.76  
0.07  
(0.05) 
0.02  
(0.08)  
 
(0.08)  
2018  
9.90  
0.14  
(0.15) 
(0.01) 
(0.13)  
 
(0.13)  
2017  
10.12  
0.17  
(0.22) 
(0.05) 
(0.17)  
 
(0.17)  
2016  
10.19  
0.18  
(0.06) 
0.12  
(0.19)  
 
(0.19)  
2015  
10.19  
0.22  
—# 
0.22  
(0.22)  
 
(0.22)  
2014  
10.44  
0.23  
(0.20) 
0.03  
(0.23)  
(0.05)  
(0.28)  
 
*  Annualized
† Not Annualized
# Amount less than $0.01
(a)  Based on average daily shares outstanding
(b)  Initial offering of shares on July 31, 2014
(c)  Prior to December 16, 2016, this Fund was known as the Government Money Market Fund. All per share amounts, for all periods, have been adjusted to reflect a 1-for-10 reverse split, which was effective December 16, 2016. In addition, on December 16, 2016, the Fund changed from a constant $1.00 net asset value per share money market fund to an ultra short government fund (that is not a money market fund).
(d)  Because calculations of portfolio turnover exclude securities whose maturity or expiration date was one year or less when the Fund acquired the securities, the Fund has no portfolio turnover information to report for this period.
(e)  Includes a return of capital distribution of less than $0.01.
 
The accompanying notes form an integral part of these financial statements.
 
54  |  Q3 2018 SEMI-ANNUAL REPORT

 



 
Ratios/Supplemental Data
 
 
 
Ratio of expenses 
 
 
 
 
 
to average net assets 
 
 
 
Ratio of net 
 
 
investment income  
Portfolio 
Net asset value,  
 
Net assets, end of  
Prior to fee  
Net of fee  
(loss) to average  
turnover 
end of period  
Total Return (%)  
period ($000)  
waivers (%)  
waivers (%)  
net assets (%)  
rate (%) 
 
14.06  
4.02†
122,579  
1.01* 
0.92* 
0.92* 
15†
14.20  
7.06  
122,069  
1.05  
1.00  
0.55  
40 
13.63  
6.32  
118,189  
1.11  
1.11  
0.10  
26 
13.24  
(0.80) 
111,488  
1.11  
1.11  
0.12  
35 
14.07  
3.73  
125,578  
1.09  
1.09  
(0.12) 
37 
14.22  
9.86  
126,904  
1.10  
1.10  
(0.20) 
36 
 
 
10.02  
0.51†
8,393  
1.57* 
0.60* 
2.59* 
18†
10.09  
1.20  
7,274  
1.65  
0.60  
2.26  
43 
10.23  
4.41  
6,522  
1.90  
0.77  
2.26  
54 
10.15  
1.78  
4,809  
2.35  
0.85  
2.20  
26 
10.21  
2.90†
3,950  
3.17* 
0.85* 
1.39* 
8† 
 
 
10.02  
0.61†
45,054  
1.01* 
0.40* 
2.79* 
18†
10.10  
1.40  
31,895  
1.09  
0.40  
2.47  
43 
10.23  
4.61  
23,854  
1.22  
0.57  
2.47  
54 
10.15  
2.06  
15,108  
1.37  
0.65  
2.39  
26 
10.20  
2.96†  
11,804  
2.54* 
0.65* 
1.56* 
8†
 
 
12.04  
0.72† 
102,037  
0.93* 
0.68* 
2.11* 
11†
12.09  
0.44  
113,238  
0.91  
0.68  
1.93  
34 
12.27  
2.15  
94,817  
0.93  
0.80  
1.85  
38 
12.28  
0.58  
100,948  
0.91  
0.85  
1.77  
23 
12.48  
1.64  
113,709  
0.89  
0.84  
1.51  
30 
12.49  
0.35  
111,675  
0.91  
0.81  
1.55  
36 
 
 
12.06  
0.82† 
878,964  
0.62* 
0.48* 
2.31* 
11†
12.11  
0.63  
1,017,962  
0.62  
0.48  
2.12  
34 
12.29  
2.38  
1,103,272  
0.62  
0.58  
2.07  
38 
12.30  
0.83  
1,155,054  
0.62  
0.62  
2.00  
23 
12.50  
1.88  
1,291,524  
0.61  
0.61  
1.73  
30 
12.51  
0.56  
1,427,037  
0.61  
0.61  
1.73  
36 
 
 
10.00  
0.90† 
108,127  
0.61* 
0.20* 
1.80* 
100†
10.00  
0.94  
104,162  
0.60  
0.20  
0.94  
25 
10.00  
0.25  
98,029  
0.66  
0.14  
0.25  
 
10.00  
0.03  
106,689  
0.70  
0.05  
0.03  
(d) 
10.00  
0.01  
108,453  
0.67  
0.01  
0.01  
(d) 
10.00  
0.01  
124,158  
0.67  
0.03  
0.01  
(d) 
 
 
9.70  
0.19† 
54,279  
0.85* 
0.85* 
1.43* 
8†
9.76  
(0.07) 
58,604  
0.84  
0.84  
1.41  
24 
9.90  
(0.54) 
62,973  
0.79  
0.79  
1.66  
29 
10.12  
1.20  
64,134  
0.78  
0.78  
1.82  
13 
10.19  
2.14  
70,002  
0.75  
0.75  
2.14  
12 
10.19  
0.33  
70,268  
0.73  
0.73  
2.11  
2 
 
The accompanying notes form an integral part of these financial statements.
 
55  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED


 
NOTES TO FINANCIAL STATEMENTS
September 30, 2018


(1) Organization
The Weitz Funds (the “Trust”) is registered under the Investment Company Act of 1940 (the “’40 Act”) as an open-end management investment company issuing shares in series, each series representing a distinct portfolio with its own investment objectives and policies. At September 30, 2018, the Trust had nine series in operation: Value Fund, Partners Value Fund, Partners III Opportunity Fund, Hickory Fund, Balanced Fund, Core Plus Income Fund, Short Duration Income Fund (formerly known as the Short-Intermediate Income Fund), Ultra Short Government Fund and Nebraska Tax-Free Income Fund (individually, a “Fund”, collectively, the “Funds”).
Currently, the Value, Partners Value, Partners III Opportunity, Core Plus Income and Short Duration Income Funds each offer two classes of shares: Institutional Class and Investor Class shares. Each class of shares has identical rights and privileges, except with respect to certain class specific expenses such as administration and shareholder servicing fees, voting rights on matters affecting a single class of shares and exchange privileges. Income, realized and unrealized gains and losses, and expenses of the Funds not directly attributable to a specific class of shares are allocated to the two classes on the basis of daily net assets of each class. Fees and expenses relating to a specific class are charged directly to that share class. All other Funds offer one class of shares.
The investment objective of the Value, Partners Value, Partners III Opportunity and Hickory Funds (the “Weitz Equity Funds”) is capital appreciation.
The investment objectives of the Balanced Fund are long-term capital appreciation, capital preservation and current income.
The investment objectives of the Core Plus Income Fund are current income and capital preservation.
The investment objective of the Short Duration Income Fund is current income consistent with the preservation of capital.
Effective December 16, 2016, the Government Money Market Fund’s name was changed to the Ultra Short Government Fund and the Fund ceased operating as a “money market fund” pursuant to Rule 2a-7 of the ’40 Act. While the Ultra Short Government Fund’s investment strategy changed, its investment objective remained the same, which is current income consistent with the preservation of capital and maintenance of liquidity.
The investment objective of the Nebraska Tax-Free Income Fund is current income that is exempt from both federal and Nebraska personal income taxes, consistent with the preservation of capital.
Investment strategies and risk factors of each Fund are discussed in the Funds’ Prospectus.
(2) Significant Accounting Policies
The Funds are investment companies and apply the accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946 Financial Services – Investment Companies. The following accounting policies are in accordance with accounting principles generally accepted in the United States.
(a) Valuation of Investments
Investments are carried at value determined using the following valuation methods:
•  Securities traded on a national or regional securities exchange are valued at the last sales price; if there were no sales on that day, securities are valued at the mean between the latest available and representative bid and ask prices; securities listed on the NASDAQ exchange are valued using the NASDAQ Official Closing Price (“NOCP”). Generally, the NOCP will be the last sales price unless the reported trade for the security is outside the range of the bid/ask price. In such cases, the NOCP will be normalized to the nearer of the bid or ask price.
•  Short sales traded on a national or regional securities exchange are valued at the last sales price; if there were no sales on that day, short sales are valued at the mean between the latest available and representative bid and ask prices.
•  Securities not listed on an exchange are valued at the mean between the latest available and representative bid and ask prices, if available.
•  The value of certain debt securities for which market quotations are not readily available may be based upon current market prices of securities that are comparable in coupon, rating and maturity or an appropriate matrix utilizing similar factors.
•  The value of a traded option is the last sales price at which such option is traded or, in the absence of a sale on or about the close of the exchange, the mean of the closing bid and ask prices.
•  Money market funds are valued at the quoted net asset value.
•  The value of securities for which market quotations are not readily available or are deemed unreliable, including restricted and not readily marketable securities, is determined in good faith in accordance with procedures approved by the Trust’s Board of Trustees. Such valuation procedures and methods for valuing securities may include, but are not limited to: multiple of earnings, multiple of book value, discount from value of a similar freely-traded security, purchase price, private transaction in the security or related securities, the nature and duration of restrictions on disposition of the security and a combination of these and other factors.
The Trust has established a Pricing Committee, composed of officers and employees of Weitz Investment Management, Inc., to supervise the daily valuation process. The Board of Trustees has also established a Valuation Committee, composed of the independent Trustees, to oversee the Pricing Committee and the valuation process. The Pricing Committee provides oversight of the approved procedures, evaluates the effectiveness of the pricing policies and reports to the Valuation Committee of the Board of Trustees. When determining the reliability of third party pricing information, the Pricing Committee, among other things, monitors the daily change in prices and reviews transactions among market participants.
(b) Option Transactions
The Funds, except for the Ultra Short Government Fund, may purchase put or call options. When a Fund purchases an option, an amount equal to the premium paid is recorded as an asset and is subsequently marked-to-market daily. Premiums paid for purchasing options that expire unexercised are recognized on the expiration date as realized losses. If an option is exercised, the premium paid is subtracted from the proceeds of the sale or added to the cost of the purchase to determine whether a Fund has realized a gain or loss on the related investment transaction. When a Fund enters into a closing transaction, a Fund realizes a gain or loss depending upon whether the amount from the closing transaction is greater or less than the premium paid.
The Funds, except for the Ultra Short Government Fund, may write put or call options. When a Fund writes an option, an amount equal to the premium received is recorded as a liability and is subsequently marked-to-market daily. Premiums received for writing options that expire unexercised are recognized on the expiration date as realized gains. If an option is exercised, the premium received is subtracted from the cost of the purchase or added to the proceeds of the sale to determine whether a Fund has realized a gain or loss on the related investment transaction. When a Fund enters into a closing transaction, a Fund realizes a gain or loss depending upon whether the amount from the closing transaction is greater or less than the premium received.
 
56  |  Q3 2018 SEMI-ANNUAL REPORT

 
The Funds attempt to limit market risk and enhance their income by writing (selling) covered call options. The risk in writing a covered call option is that a Fund gives up the opportunity of profit if the market price of the financial instrument increases. A Fund also has the additional risk of not being able to enter into a closing transaction if a liquid secondary market does not exist. The risk in writing a put option is that a Fund is obligated to purchase the financial instrument underlying the option at prices which may be significantly different than the current market price.
(c) Securities Sold Short
The Funds, except for the Ultra Short Government Fund, may engage in selling securities short, which obligates a Fund to replace a security borrowed by purchasing the same security at the current market value. A Fund incurs a loss if the price of the security increases between the date of the short sale and the date on which the Fund replaces the borrowed security. A Fund realizes a gain if the price of the security declines between those dates.
(d) Federal Income Taxes
It is the policy of each Fund to comply with all sections of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income to shareholders; therefore, no provision for income or excise taxes is required.
Net investment income and net realized gains may differ for financial statement and tax purposes. The character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for Federal income tax purposes. Also, due to the timing of dividend distributions, the fiscal year in which amounts are distributed may differ from the year that the income or realized gains were recorded by the Funds.
The Funds have reviewed their tax positions taken on federal income tax returns, for each of the three open tax years and as of September 30, 2018, and have determined that no provisions for income taxes are required in the Funds’ financial statements.
(e) Securities Transactions
Securities transactions are accounted for on the date the securities are purchased or sold (trade date). Realized gains or losses are determined by specifically identifying the security sold.
Income dividends less foreign tax withholding (if any), dividends on short positions and distributions to shareholders are recorded on the ex-dividend date. Interest, including amortization of discount or premium, is accrued as earned.
(f) Dividend Policy
The Funds declare and distribute income dividends and capital gains distributions as may be required to qualify as a regulated investment company under the Internal Revenue Code.
Generally, the Core Plus Income, Short Duration Income and Nebraska Tax-Free Income Funds pay income dividends on a quarterly basis. The Ultra Short Government Fund declares dividends daily and pays dividends monthly. All dividends and distributions are reinvested automatically, unless the shareholder elects otherwise.
(g) Other
Expenses that are directly related to a Fund are charged directly to that Fund. Other operating expenses of the Trust are prorated to each Fund on the basis of relative net assets or another appropriate basis. Income, realized and unrealized gains and losses and expenses (other than class specific expenses) are allocated to each class of shares based on its relative net assets, except that each class separately bears expenses related specifically to that class, such as transfer agent fees and registration fees.
(h) Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increase and decrease in net assets from operations during the period. Actual results could differ from those estimates.
(3) Fund Share Transactions 
 
 
 
Six months ended September 30, 2018 
 
Year ended March 31, 2018 
 
Shares 
$ Amount 
Shares 
$ Amount 
Value - Investor Class 
 
 
 
 
Sales 
366,767 
15,827,334 
245,819 
10,559,055 
Redemptions 
(1,125,069)
(48,834,904)
(2,904,810)
(124,648,038)
 Reinvestment of distributions 
589,712 
24,579,206 
992,054 
41,706,712 
Net increase (decrease) 
(168,590)
(8,428,364)
(1,666,937)
(72,382,271)
 
Value - Institutional Class 
 
 
 
 
Sales 
260,491 
11,386,308 
370,081 
15,871,158 
Redemptions 
(166,972)
(7,340,250)
(397,304)
(17,225,992)
 Reinvestment of distributions 
196,467 
8,267,344 
303,459 
12,847,282 
Net increase (decrease) 
289,986 
12,313,402 
276,236 
11,492,448 
 
Partners Value - Investor Class 
 
 
 
 
Sales 
79,796 
2,512,950 
196,491 
6,186,772 
Redemptions 
(1,191,450)
(37,625,654)
(3,919,027)
(123,923,405)
 Reinvestment of distributions 
234,232 
7,151,103 
246,710 
7,776,293 
Net increase (decrease) 
(877,422)
(27,961,601)
(3,475,826)
(109,960,340)
 
57  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 



         
 
Six months ended September 30, 2018 
 
Year ended March 31, 2018 
 
Shares 
$ Amount 
Shares 
$ Amount 
Partners Value - Institutional Class 
 
 
 
 
Sales 
219,640 
7,055,603 
825,840 
26,291,070 
Redemptions 
(393,352)
(12,482,788)
(522,436)
(16,636,524)
 Reinvestment of distributions 
178,746 
5,508,947 
176,269 
5,601,822 
Net increase (decrease) 
5,034 
81,762 
479,673 
15,256,368 
 
Partners III Opportunity - Investor Class 
 
 
 
 
Sales 
66,972 
945,894 
547,742 
7,949,833 
Redemptions 
(361,571)
(5,120,441)
(834,808)
(12,091,006)
 Reinvestment of distributions 
104,447 
1,406,899 
86,582 
1,231,667 
Net increase (decrease) 
(190,152)
(2,767,648)
(200,484)
(2,909,506)
 
Partners III Opportunity - Institutional Class 
 
 
 
 
Sales 
674,791 
9,739,285 
3,547,724 
52,545,124 
Redemptions 
(2,717,450)
(39,514,528)
(6,330,477)
(93,950,423)
 Reinvestment of distributions 
2,651,872 
36,861,021 
1,725,691 
25,184,843 
Net increase (decrease) 
609,213 
7,085,778 
(1,057,062)
(16,220,456)
 
Hickory 
 
 
 
 
Sales 
22,356 
1,147,766 
193,055 
10,396,158 
Redemptions 
(310,825)
(15,897,416)
(808,482)
(43,866,640)
 Reinvestment of distributions 
176,994 
8,786,005 
188,188 
9,873,953 
Net increase (decrease) 
(111,475)
(5,963,645)
(427,239)
(23,596,529)
 
Balanced 
 
 
 
 
Sales 
258,068 
3,634,597 
486,654 
6,915,990 
Redemptions 
(385,260) 
(5,433,336)
(742,365)
(10,508,805)
 Reinvestment of distributions 
252,043 
3,432,829 
177,478 
2,491,218 
Net increase (decrease) 
124,851 
1,634,090 
(78,233)
(1,101,597)
 
Core Plus Income - Investor Class 
 
 
 
 
Sales 
193,382 
1,952,380 
239,325 
2,451,341 
Redemptions 
(86,396) 
(871,572)
(169,645)
(1,735,968)
 Reinvestment of distributions 
10,073 
101,232 
13,301 
136,187 
Net increase (decrease) 
117,059 
1,182,040 
82,981 
851,560 
 
Core Plus Income - Institutional Class 
 
 
 
 
Sales 
1,486,802 
14,996,610 
1,157,490 
11,888,041 
Redemptions 
(207,013) 
(2,085,706)
(399,693)
(4,079,800)
 Reinvestment of distributions 
56,607 
568,809 
69,788 
713,832 
Net increase (decrease) 
1,336,396 
13,479,713 
827,585 
8,522,073 
 
Short Duration Income - Investor Class 
 
 
 
 
Sales 
592,293 
7,160,156 
4,946,676 
60,560,427 
Redemptions 
(1,581,161) 
(19,119,903)
(3,475,321)
(42,556,897)
 Reinvestment of distributions 
98,322 
1,185,335 
167,243 
2,039,632 
Net increase (decrease) 
(890,546) 
(10,774,412)
1,638,598 
20,043,162 
 
Short Duration Income - Institutional Class 
 
 
 
 
Sales 
4,762,547 
57,704,790 
18,905,284 
232,351,392 
Redemptions 
(16,845,607) 
(204,184,174)
(26,428,380)
(324,179,104)
  Reinvestment of distributions 
912,880 
11,023,693 
1,804,816 
22,063,002 
Net increase (decrease) 
(11,170,180) 
(135,455,691)
(5,718,280)
(69,764,710)
 
 
58  |  Q3 2018 SEMI-ANNUAL REPORT

 



 
Six months ended September 30, 2018 
 
Year ended March 31, 2018 
 
Shares 
$ Amount 
Shares 
$ Amount 
Ultra Short Government 
 
 
 
 
Sales 
3,310,553 
33,105,533 
4,617,178 
46,164,098 
Redemptions 
(2,994,591)
(29,945,910)
(4,086,722)
(40,860,827)
 Reinvestment of distributions 
79,916 
799,155 
83,219 
832,075 
Net increase (decrease) 
395,878 
3,958,778 
613,675 
6,135,346 
 
Nebraska Tax-Free Income 
 
 
 
 
Sales 
39,287 
383,756 
223,108 
2,206,241 
Redemptions 
(460,867)
(4,494,214)
(634,561)
(6,283,254)
 Reinvestment of distributions 
12,997 
126,342 
54,910 
544,622 
Net increase (decrease) 
(408,583)
(3,984,116)
(356,543)
(3,532,391) 
 
4) Related Party Transactions
Each Fund has retained Weitz Investment Management, Inc. (the “Adviser”) as its investment adviser. In addition, the Trust has an agreement with Weitz Securities, Inc. (the “Distributor”), a company under common control with the Adviser, to act as distributor for shares of the Trust. Certain officers of the Trust are also officers and directors of the Adviser and the Distributor.
Under the terms of management and investment advisory agreements, the Adviser is paid a monthly fee based on average daily net assets. The annual investment advisory fee schedule for each of the Weitz Equity Funds is as follows:
Value and Partners Value Funds:
     
Greater Than 
Less Than or Equal To 
Rate 
$ 0 
$1,000,000,000 
0.90% 
1,000,000,000 
2,000,000,000 
0.85% 
2,000,000,000 
3,000,000,000 
0.80% 
3,000,000,000 
5,000,000,000 
0.75% 
5,000,000,000 
 
0.70% 
 
Partners III Opportunity Fund: 
 
Greater Than 
Less Than or Equal To 
Rate 
$ 0 
$1,000,000,000 
1.00% 
1,000,000,000 
2,000,000,000 
0.95% 
2,000,000,000 
3,000,000,000 
0.90% 
3,000,000,000 
5,000,000,000 
0.85% 
5,000,000,000 
 
0.80% 
 
Hickory Fund: 
 
 
Greater Than 
Less Than or Equal To 
Rate 
$ 0 
$2,500,000,000 
1.00% 
2,500,000,000 
5,000,000,000 
0.90% 
5,000,000,000 
 
0.80% 
 
The Balanced Fund pays the Adviser, on a monthly basis, an annual advisory fee equal to 0.65% of the Fund’s average daily net assets.
The Core Plus Income, Short Duration Income and Nebraska Tax-Free Income Funds each pay the Adviser, on a monthly basis, an annual advisory fee equal to 0.40% of the respective Fund’s average daily net assets.
The Ultra Short Government Fund pays the Adviser, on a monthly basis, an annual advisory fee equal to 0.30% of the Fund’s average daily net assets (effective December 16, 2016). Prior to December 16, 2016, the Ultra Short Government Fund paid an annual advisory fee equal to 0.40%.
The Adviser also provides administrative services, including shareholder administrative services, to each Fund pursuant to agreements which provide that the Funds will pay the Adviser a monthly fee based on the average daily net assets of each respective Fund and/or a fee per account, plus third party expenses directly related to providing such services.
Through July 31, 2019, the Adviser has agreed in writing to reimburse or to pay directly a portion of the Funds’ expenses to limit the net annual operating expense ratio (excluding taxes, interest, brokerage costs, acquired fund fees and expenses and extraordinary expenses). The expense caps and dollar amount of expenses reimbursed during the six months ended September 30, 2018, are as follows:
 
Annual Operating Expense Ratio Cap* 
 
 
 
 
 
Short 
 
 
 
Partners 
 
 
Duration 
Ultra Short 
 
Value 
Value 
Balanced 
Core Plus Income 
Income 
Government 
Annual Operating Expense Cap*: 
 
 
 
 
 
 
Investor Class 
1.30% 
1.30% 
0.85% 
0.60% 
0.68% 
 
Institutional Class 
0.99% 
0.99% 
 
0.40% 
0.48% 
0.20% 
Expenses Reimbursed by the Adviser: 
 
 
 
 
 
 
Investor Class 
 
 
56,239 
36,292 
136,672 
 
Institutional Class 
95,627 
124,432 
 
122,111 
679,677 
215,330 
 
*  Funds with a single share class are shown with the Investor Class, except for the Ultra Short Government Fund which has been designated Institutional Class.
As of September 30, 2018, the controlling shareholder of the Adviser held shares totaling approximately 34%, 22%, 37%, 54%, 12% and 72% of the Partners III Opportunity, Hickory, Balanced, Core Plus Income, Ultra Short Government and Nebraska Tax-Free Income Funds, respectively.
 
59  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED




(5) Distributions to Shareholders and Distributable Earnings
The tax character of distributions paid by the Funds are summarized as follows (in U.S. dollars):
                 
 
Six months 
 
Six months 
 
Six months 
 
Six months 
 
 
ended 
Year ended 
ended 
Year ended 
ended 
Year ended 
ended 
Year ended 
Distributions paid from: 
Sept. 30, 2018 
 March 31, 2018 
Sept. 30, 2018 
 March 31, 2018 
Sept. 30, 2018 
 March 31, 2018 
Sept. 30, 2018  
 March 31, 2018 
 
 
Value 
Partners Value 
Partners III Opportunity 
Hickory 
 
 
Ordinary income 
 
 
 
 
 
 
 
154,488 
Long-term capital gains 
35,197,949 
57,363,750 
15,605,488 
15,702,380 
39,388,621 
30,230,157 
11,702,247 
12,675,974 
Total distributions 
35,197,949 
57,363,750 
15,605,488 
15,702,380 
39,388,621 
30,230,157 
11,702,247 
12,830,462 
 
 
Balanced 
Core Plus Income 
Short Duration Income 
Ultra Short Government 
 
Ordinary income 
482,490 
832,062 
670,795 
924,524 
12,361,945 
24,670,337 
950,529 
940,684 
Long-term capital gains 
5,420,511 
2,471,865 
 
87,838 
 
 
 
 
Total distributions 
5,903,001 
3,303,927 
670,795 
1,012,362 
12,361,945 
24,670,337 
950,529 
940,684 
 
 
Nebraska Tax-Free Income 
 
 
 
 
 
 
 
Ordinary income 
 
26,345 
 
 
 
 
 
 
Tax-exempt income 
454,817 
792,349 
 
 
 
 
 
 
Total distributions 
454,817 
818,694 
 
 
 
 
 
 
 
As of September 30, 2018, the components of net assets on a tax basis were as follows (in U.S. dollars):
           
 
Value 
Partners Value 
Opportunity 
Hickory 
Balanced 
Cost of investments 
518,394,065 
430,209,575 
229,432,512 
157,706,170 
105,437,849 
 
Gross unrealized appreciation 
308,398,705 
236,666,796 
291,875,239 
83,118,398 
18,760,336 
Gross unrealized depreciation 
(6,654,837)
(10,676,106)
(67,500,640)
(5,056,288)
(1,692,787)
Net unrealized appreciation (depreciation) 
301,743,868 
225,990,690 
224,374,599 
78,062,110 
17,067,549 
 
Undistributed net investment income (loss) 
(2,216,034)
(941,229)
(2,736,754)
(425,211)
569,211 
Undistributed net realized gain (loss) 
33,283,573 
41,774,091 
10,412,164 
12,486,542 
2,723,315 
Paid-in capital 
484,494,843 
386,776,160 
421,560,695 
145,148,703 
102,218,769 
Net assets 
817,306,250 
653,599,712 
653,610,704 
235,272,144 
122,578,844 
 
         
 
 
Short Duration 
Ultra Short 
Nebraska Tax-Free 
 
Core Plus Income 
Income 
Government 
Income 
Cost of investments 
53,870,896 
983,760,356 
107,724,630 
55,151,590 
 
Gross unrealized appreciation 
197,707 
5,216,410 
1,697 
103,304 
Gross unrealized depreciation 
(946,779)
(12,325,076)
(28,703)
(965,417)
Net unrealized appreciation (depreciation) 
(749,072)
(7,108,666)
(27,006)
(862,113)
 
Undistributed net investment income (loss) 
16,868 
336,406 
26,702 
 
Undistributed tax-exempt income 
 
 
 
3,205 
Other temporary differences 
 
 
(25,051)
 
Undistributed net realized gain (loss) 
(29,659)
(1,392,353)
(6,891)
(64,679)
Paid-in capital 
54,208,688 
989,165,534 
108,159,186 
55,202,189 
Net assets 
53,446,825 
981,000,921 
108,126,940 
54,278,602 
 
Capital loss carryforwards represent tax basis capital losses that may be carried over to offset future realized capital gains, if any. To the extent that carryforwards are used, no capital gains distributions will be made. As of March 31, 2018, the character of the carryforwards were as follows (in U.S. dollars):
       
 
Short Duration 
Ultra Short 
Nebraska Tax-Free 
 
Income 
Government 
Income 
Short term (no expiration) 
(699,164) 
(586) 
 
Long term (no expiration) 
(2,607,711) 
 
(73,266) 
 
 
60  |  Q3 2018 SEMI-ANNUAL REPORT




(6) Securities Transactions
Purchases and proceeds from maturities or sales of investment securities of the Funds for the six months ended September 30, 2018, excluding short-term securities and U.S. government obligations, are summarized as follows (in U.S. dollars):
 
 
 
 
 
 
 
Short 
 
Nebraska 
 
 
Partners 
Partners III 
 
 
Core Plus 
Duration 
Ultra Short 
Tax-Free 
 
Value 
Value 
Opportunity 
Hickory 
Balanced 
Income 
Income 
Government 
Income 
Purchases 
86,041,537 
99,151,457 
100,629,087 
19,971,247 
9,256,336 
11,066,207 
100,510,940 
9,713,438 
4,269,023 
Proceeds 
97,308,399 
126,645,320 
103,029,151 
27,261,577 
13,861,839 
7,359,119 
199,992,885 
6,994,443 
4,840,000 
 
(a) Illiquid and Restricted Securities
The Funds own certain securities that have a limited trading market and/or certain restrictions on trading and therefore may be illiquid and/or restricted. Such securities have been valued at fair value in accordance with the procedures described in Note (2)(a). Because of the inherent uncertainty of valuation, these values may differ from the values that would have been used had a ready market for these securities existed and these differences could be material. Illiquid and/or restricted securities owned at September 30, 2018, include the following:
       
 
Acquisition 
Partners III 
 
 
Date 
Opportunity 
Hickory 
Intelligent Systems Corp. 
12/03/91 
$2,899,379 
$            — 
LICT Corp. 
9/09/96 
 
2,202,017 
Total cost of illiquid and/or restricted securities 
 
2,899,379 
2,202,017 
Value at September 30, 2018 
 
23,993,900 
14,601,625 
Percent of net assets at September 30, 2018 
 
3.7% 
6.2% 
 
(b) Options Written
The locations in the Statements of Assets and Liabilities as of September 30, 2018, of the Funds’ derivative positions, none of which are designated as hedging instruments are as follows (in U.S. dollars):
 
 
 
 
 
Average 
Gross 
 
 
 
Fair Value of 
 
Month-End 
Notional 
 
 
 
 
Liability 
Notional 
Amount 
Fund 
Type of Derivative 
Location 
Asset Derivatives 
Derivatives 
Amount 
Outstanding 
 
Partners III Opportunity 
Call options written 
Options written, at value 
 
(491,000) 
5,639,250 
8,000,000 
 
Partners III Opportunity 
Put options written 
Options written, at value 
 
(232,500) 
1,679,333 
2,000,000 
 
Transactions in derivative instruments during the six months ended September 30, 2018, are recorded in the following locations in the Statements of Operations (in U.S. dollars):
           
 
 
 
 
 
Change in 
 
 
 
Realized 
 
Unrealized 
Fund 
Type of Derivative 
Location 
Gain (Loss) 
Location 
Gain (Loss) 
 
 
 
 
Net unrealized appreciation 
 
Partners III Opportunity 
Call options written 
Net realized gain (loss) - options written 
315,184 
(depreciation) - options written 
(316,006) 
 
 
 
 
 
Net unrealized appreciation 
 
Partners III Opportunity 
Put options written 
Net realized gain (loss) - options written 
114,867 
(depreciation) - options written 
(123,213) 
 
(7) Affiliated Issuers
Affiliated issuers, as defined under the Investment Company Act of 1940, are those in which a Fund’s holdings of an issuer represent 5% or more of the outstanding voting securities of the issuer. A summary of each Fund’s holdings in the securities of such issuers is set forth below:
                 
 
 
 
 
Number of 
 
 
 
 
 
Number of 
 
 
Shares Held 
Value 
 
 
Change in 
 
Shares Held 
Gross 
Gross 
September 30, 
September 30, 
Dividend 
Realized 
Unrealized 
 
March 31, 2018 
Additions 
Reductions 
2018 
2018 
Income 
Gain (Loss) 
Gain (Loss) 
Partners III Opportunity: 
 
 
 
 
 
 
 
 
Intelligent Systems Corp.† 
2,270,000 
 
 
2,270,000 
$23,993,900 
$ — 
$ — 
$12,394,200 
 
† Controlled affiliate in which the Fund owns 25% or more of the outstanding voting securities.
 
61  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
(8) Contingencies
Each Fund indemnifies the Trust’s officers and trustees for certain liabilities that might arise from their performance of their duties to each of the Funds. Additionally, in the normal course of business the Funds enter into contracts that contain a variety of representations and warranties and which provide general indemnifications. The Funds’ maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, based on experience, the Funds expect the risk of loss to be remote.
(9) Financial Instruments With Off-Balance Sheet Risks
Option contracts written and securities sold short result in off-balance sheet risk as the Fund’s ultimate obligation to satisfy the terms of the contract or the sale of securities sold short may exceed the amount recognized in the Statements of Assets and Liabilities.
The Funds are required to maintain collateral in a segregated account to provide adequate margin as determined by the broker.
(10) Margin Borrowing Agreement
The Partners III Opportunity Fund has a margin account with its prime broker, Bank of America Merrill Lynch, under which the Fund may borrow against the value of its securities, subject to regulatory limitations. Interest accrues at the federal funds rate plus 0.625% (2.795% at September 30, 2018). Interest is accrued daily and paid monthly. The Partners III Opportunity Fund held a cash balance of $201,100,310, with the broker at September 30, 2018.
The Partners III Opportunity Fund is exposed to credit risk from its prime broker who effects transactions and extends credit pursuant to a prime brokerage agreement. The Adviser attempts to minimize the credit risk by monitoring credit exposure and the creditworthiness of the prime broker.
(11) Concentration of Credit Risk
Approximately 91% of the Nebraska Tax-Free Income Fund’s net assets are in obligations of political subdivisions of the State of Nebraska, which are subject to the credit risk associated with the non-performance of such issuers.
(12) Fair Value Measurements
Various inputs are used in determining the value of the Fund’s investments. These inputs are used in determining the value of the Funds’ investments and are summarized in the following fair value hierarchy:
•  Level 1 – quoted prices in active markets for identical securities;
•  Level 2 – other significant observable inputs (including quoted prices for similar securities);
•  Level 3 – significant unobservable inputs (including the Funds’ own assumptions in determining the fair value of investments).
The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.
A description of the valuation techniques applied to the Funds’ major categories of assets and liabilities measured at fair value on a recurring basis follows.
•  Equity securities. Securities traded on a national securities exchange (or reported on the NASDAQ national market) are stated at the last reported sales price on the day of valuation. To the extent these securities are actively traded and valuation adjustments are not applied, they are categorized in Level 1 of the fair value hierarchy. Preferred stock and other equities traded on inactive markets or valued by reference to similar instruments are categorized in Level 2.
•  Corporate and Municipal bonds. The fair values of corporate and municipal bonds are estimated using various techniques, which may consider recently executed transactions in securities of the issuer or comparable issuers, market price quotations (where observable), bond spreads and fundamental data relating to the issuer. Although most corporate and municipal bonds are categorized in Level 2 of the fair value hierarchy, in instances where lower relative weight is placed on transaction prices, quotations, or similar observable inputs, they are categorized in Level 3.
•  Asset-backed securities. The fair values of asset-backed securities (including non-government agency mortgage- backed securities and interest-only securities) are generally estimated based on models that consider the estimated cash flows of each tranche of the entity, a benchmark yield and an estimated tranche specific spread to the benchmark yield based on the unique attributes of the tranche. Certain securities are valued principally using dealer quotations. To the extent the inputs are observable and timely, the values would be categorized in Level 2 of the fair value hierarchy; otherwise they would be categorized as Level 3.
•  U.S. Government securities. U.S. Government securities are normally valued using a model that incorporates market observable data such as reported sales of similar securities, broker quotes, yields, bids, offers and reference data. Certain securities are valued principally using dealer quotations. U.S. Government securities are categorized in Level 1 or Level 2 of the fair value hierarchy depending on the inputs used and market activity levels for specific securities.
•  U.S. agency securities. U.S. agency securities are comprised of two main categories consisting of agency issued debt and mortgage-backed securities. Agency issued debt securities are generally valued in a manner similar to U.S. Government securities. Mortgage-backed securities include collateralized mortgage obligations, to-be-announced (TBA) securities and mortgage pass-through certificates. Mortgage-backed securities are generally valued using dealer quotations. Depending on market activity levels and whether quotations or other data are used, these securities are typically categorized in Level 2 of the fair value hierarchy.
•  Restricted and/or illiquid securities. Restricted and/or illiquid securities for which quotations are not readily available are valued in accordance with procedures approved by the Trust’s Board of Trustees. Restricted securities issued by publicly traded companies are generally valued at a discount to similar publicly traded securities. Restricted or illiquid securities issued by nonpublic entities may be valued by reference to comparable public entities or fundamental data relating to the issuer or both. Depending on the relative significance of valuation inputs, these instruments may be classified in either Level 2 or Level 3 of the fair value hierarchy.
•  Derivative instruments. Listed derivatives, such as the Funds’ equity option contracts, that are valued based on closing prices from the exchange or the mean of the closing bid and ask prices are generally categorized in Level 1 of the fair value hierarchy.
The following is a summary of inputs used, in U.S. dollars, as of September 30, 2018, in valuing the Funds’ assets and liabilities carried at fair value. The Schedule of Investments for each Fund provides a detailed breakdown of each category.
         
Value
 
Level 1 
Level 2 
Level 3 
Total 
Assets: 
 
 
 
 
Investments in Securities: 
 
 
 
Common Stocks 
739,389,610 
 
 
739,389,610 
Cash Equivalents 
80,748,323 
 
 
80,748,323 
Total 
 
 
 
 
Investments in 
 
 
 
 
Securities 
820,137,933 
 
 
820,137,933 
 
 
62  |  Q3 2018 SEMI-ANNUAL REPORT

 



         
Partners Value
 
Level 1 
Level 2 
Level 3 
Total 
Assets: 
 
 
 
 
Investments in Securities: 
 
 
 
Common Stocks 
573,582,470 
 
 
573,582,470 
Cash Equivalents 
82,617,795 
 
 
82,617,795 
Total 
 
 
 
 
Investments in 
 
 
 
 
Securities 
656,200,265 
 
 
656,200,265 
 
Partners III Opportunity
 
Level 1 
Level 2 
Level 3 
Total 
Assets: 
 
 
 
 
Investments in Securities: 
 
 
 
Common Stocks 
 
 
 
 
Information 
 
 
 
 
Technology 
122,987,950 
23,993,900 
 
146,981,850 
Other 
479,897,380 
 
 
479,897,380 
Cash Equivalents 
22,125,381 
 
 
22,125,381 
Total 
 
 
 
 
Investments in 
 
 
 
 
Securities 
625,010,711 
23,993,900 
 
649,004,611 
Liabilities: 
 
 
 
 
Securities 
 
 
 
 
Sold Short 
(194,474,000) 
 
 
(194,474,000) 
Options Written 
(723,500) 
 
 
(723,500) 
 
Hickory
 
Level 1 
Level 2 
Level 3 
Total 
Assets: 
 
 
 
 
Investments in Securities: 
 
 
 
Common Stocks 
 
 
 
 
Communication 
 
 
 
 
Services 
69,873,180 
14,601,625 
 
84,474,805 
Other 
111,305,190 
 
 
111,305,190 
Cash Equivalents 
39,988,285 
 
 
39,988,285 
Total 
 
 
 
 
Investments in 
 
 
 
 
Securities 
221,166,655 
14,601,625 
 
235,768,280 
 
         
Balanced
 
Level 1 
Level 2 
Level 3 
Total 
Assets: 
 
 
 
 
Investments in Securities: 
 
 
 
Common Stocks 
57,151,359 
 
 
57,151,359 
Corporate Bonds 
 
23,949,810 
 
23,949,810 
Corporate 
 
 
 
 
Convertible 
 
 
 
 
Bonds 
 
1,014,240 
 
1,014,240 
Asset-Backed 
 
 
 
 
Securities 
 
1,565,707 
 
1,565,707 
Mortgage- 
 
 
 
 
Backed Securities 
 
2,671,083 
 
2,671,083 
U.S. Treasury 
 
35,131,204 
 
35,131,204 
Cash Equivalents 
1,021,995 
 
 
1,021,995 
Total 
 
 
 
 
Investments in 
 
 
 
 
Securities 
58,173,354 
64,332,044 
 
122,505,398 
 
Core Plus Income
 
Level 1 
Level 2 
Level 3 
Total 
Assets: 
 
 
 
 
Investments in Securities: 
 
 
 
Corporate Bonds 
 
12,781,721 
 
12,781,721 
Corporate 
 
 
 
 
Convertible 
 
 
 
 
Bonds 
 
982,622 
 
982,622 
Asset-Backed 
 
 
 
 
Securities 
 
13,572,683 
 
13,572,683 
Commercial 
 
 
 
 
Mortgage- 
 
 
 
 
Backed Securities 
 
956,906 
 
956,906 
Mortgage- 
 
 
 
 
Backed Securities 
 
1,735,548 
 
1,735,548 
Taxable 
 
 
 
 
Municipal Bonds 
 
412,820 
 
412,820 
U.S. Treasury 
 
21,142,568 
 
21,142,568 
Common Stocks 
241,164 
 
 
241,164 
Cash Equivalents 
1,295,792 
 
 
1,295,792 
Total 
 
 
 
 
Investments in 
 
 
 
 
Securities 
1,536,956 
51,584,868 
 
53,121,824 

 
63  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED




         
Short Duration Income
 
Level 1 
Level 2 
Level 3 
Total 
Assets: 
 
 
 
 
Investments in Securities: 
 
 
 
 
Corporate Bonds 
 
358,526,494 
 
358,526,494 
Corporate 
 
 
 
 
Convertible 
 
 
 
 
Bonds 
 
34,558,603 
 
34,558,603 
Asset-Backed 
 
 
 
 
Securities 
 
127,785,065 
 
127,785,065 
Commercial 
 
 
 
 
Mortgage- 
 
 
 
 
Backed Securities 
 
12,966,267 
 
12,966,267 
Mortgage- 
 
 
 
 
Backed Securities 
 
164,430,871 
 
164,430,871 
Taxable 
 
 
 
 
Municipal Bonds 
 
2,235,170 
 
2,235,170 
U.S. Treasury 
 
269,807,721 
 
269,807,721 
Common Stocks 
4,060,000 
 
 
4,060,000 
Cash Equivalents 
2,281,499 
 
 
2,281,499 
Total 
 
 
 
 
Investments in 
 
 
 
 
Securities 
6,341,499 
970,310,191 
 
976,651,690 
 
Ultra Short Government
 
Level 1 
Level 2 
Level 3 
Total 
Assets: 
 
 
 
 
Investments in Securities: 
 
 
 
 
Corporate Bonds 
 
10,628,916 
 
10,628,916 
Asset-Backed 
 
 
 
 
Securities 
 
8,783,691 
 
8,783,691 
U.S. Treasury 
 
87,828,104 
 
87,828,104 
Cash Equivalents 
456,913 
 
 
456,913 
Total 
 
 
 
 
Investments 
 
 
 
 
in Securities 
456,913 
107,240,711 
 
107,697,624 
 
         
Nebraska Tax-Free Income
 
Level 1 
Level 2 
Level 3 
Total 
Assets: 
 
 
 
 
Investments in Securities: 
 
 
 
 
Municipal Bonds 
 
54,052,723 
 
54,052,723 
Cash Equivalents 
236,754 
 
 
236,754 
Total 
 
 
 
 
Investments in 
 
 
 
 
Securities 
236,754 
54,052,723 
 
54,289,477 
 
For transfers between the levels within the fair value hierarchy, the Funds have adopted a policy of recognizing the transfers as of the date of the underlying event which caused the transfer. During the six months ended September 30, 2018, there were no transfers between Level 1, Level 2 and Level 3.
During the six months ended September 30, 2018, there were no assets in which significant unobservable inputs (Level 3) were used.
(13) Subsequent Events
Management has evaluated the impact of all subsequent events on the Funds through the date the financial statements were issued and has determined that there were no additional subsequent events requiring recognition or disclosure in the financial statements.
 
64  |  Q3 2018 SEMI-ANNUAL REPORT

 



ACTUAL AND HYPOTHETICAL EXPENSES
FOR COMPARISON PURPOSES
Example
As a shareholder of one or more of the Funds, you incur two types of costs: (1) transaction costs, including any transaction fees that you may be charged if you purchase or redeem your Fund shares through certain financial institutions; and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period from April 1, 2018 through September 30, 2018.
Actual Expenses
The first line for each Fund in the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an account value of $8,600 divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid from 4/01/18 – 9/30/18” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line for each Fund in the table below provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each Fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of the Fund. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in a specific Weitz Fund to other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs charged by certain financial institutions. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if you incurred transactional fees, your costs would have been higher. Actual and hypothetical expenses for each Fund are provided in this table.
           
 
 
Beginning Account 
Ending Account 
Annualized 
Expenses Paid from 
 
 
Value 4/01/18 
Value 9/30/18 
Expense Ratio 
4/01/18-9/30/18(1) 
 
Actual 
$1,000.00 
$1,082.14 
1.22% 
$6.37 
Value - Investor Class 
Hypothetical(2) 
1,000.00 
1,018.90 
1.22 
6.17 
 
Value - Institutional Class 
Actual 
1,000.00 
1,083.57 
0.99 
5.17 
 
Hypothetical(2) 
1,000.00 
1,020.05 
0.99 
5.01 
 
Partners Value - Investor Class 
Actual 
1,000.00 
1,058.28 
1.26 
6.50 
 
Hypothetical(2) 
1,000.00 
1,018.70 
1.26 
6.38 
 
Partners Value - Institutional Class 
Actual 
1,000.00 
1,059.37 
0.99 
5.11 
 
Hypothetical(2) 
1,000.00 
1,020.05 
0.99 
5.01 
 
Partners III Opportunity - Investor Class 
Actual 
1,000.00 
1,053.04 
2.17 
11.17 
 
Hypothetical(2) 
1,000.00 
1,014.15 
2.17 
10.96 
 
Partners III Opportunity - Institutional Class 
Actual 
1,000.00 
1,055.73 
1.61 
8.30 
 
Hypothetical(2) 
1,000.00 
1,016.95 
1.61 
8.14 
 
Hickory 
Actual 
1,000.00 
1,044.60 
1.26 
6.46 
 
Hypothetical(2) 
1,000.00 
1,018.70 
1.26 
6.38 
 
Balanced 
Actual 
1,000.00 
1,040.21 
0.92 
4.71 
 
Hypothetical(2) 
1,000.00 
1,020.40 
0.92 
4.66 
 
Core Plus Income - Investor Class 
Actual 
1,000.00 
1,005.15 
0.60 
3.02 
 
Hypothetical(2) 
1,000.00 
1,022.00 
0.60 
3.04 
 
Core Plus Income - Institutional Class 
Actual 
1,000.00 
1,006.14 
0.40 
2.01 
 
Hypothetical(2) 
1,000.00 
1,023.00 
0.40 
2.03 
 
Short Duration Income - Investor Class 
Actual 
1,000.00 
1,007.21 
0.68 
3.42 
 
Hypothetical(2) 
1,000.00 
1,021.60 
0.68 
3.45 
 
Short Duration Income - Institutional Class 
Actual 
1,000.00 
1,008.20 
0.48 
2.42 
 
Hypothetical(2) 
1,000.00 
1,022.60 
0.48 
2.43 
 
Ultra Short Government 
Actual 
1,000.00 
1,009.01 
0.20 
1.01 
 
Hypothetical(2) 
1,000.00 
1,024.00 
0.20 
1.01 
 
Nebraska Tax-Free Income 
Actual 
1,000.00 
1,001.95 
0.85 
4.27 
 
Hypothetical(2) 
1,000.00 
1,020.75 
0.85 
4.31 
 
(1) Expenses are equal to the annualized expense ratio for the Fund, multiplied by the average account value over the period, multiplied by the number of days in the most recent fiscal half year (183/365).
(2) Assumes 5% total return before expenses.
 
65  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED


 
OTHER INFORMATION
Proxy Voting Policy
A description of the Funds’ proxy voting policies and procedures is available without charge, upon request by (i) calling 800-304-9745, (ii)/on the Funds’ website at weitzinvestments.com; and (iii) on the SEC’s website at sec.gov.
Information on how each of the Funds voted proxies relating to portfolio securities during each twelve month period ended June 30 is available: (i) on the Funds’ website at weitzinvestments.com and (ii) on the SEC’s website at sec.gov.
Form N-Q
The Funds file complete schedules of their portfolio holdings with the Securities and Exchange Commission for the first and third quarters of each fiscal year on Form N-Q. The Funds’ Form N-Q is available on the SEC’s website at sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington DC. Information on the operation of the Public Reference Room may be obtained by calling 800/SEC-0330. A list of the Funds’ quarter-end holdings is available on the Funds’ website at weitzinvestments.com within 15 days after the end of each quarter and remains available on the website until the list is updated in the subsequent quarter.
Factors Considered by the Board of Trustees in Approving the Continuation of the Management and Investment Advisory Agreements with Weitz Investment Management, Inc. for each of the Funds
In accordance with the Investment Company Act of 1940, as amended (the “1940 Act”), the Board of Trustees of the Funds is required, on an annual basis, to consider the continuation of the Management and Investment Advisory Agreements (the “Agreements”) with Weitz Investment Management, Inc. (“Weitz Inc.”), and this must take place at an in-person meeting of the Board. The relevant provisions of the 1940 Act specifically provide that it is the duty of the Board to request and evaluate such information as the Board determines is necessary to allow them to properly consider the continuation of the Agreements, and it is the duty of Weitz Inc. to furnish the Trustees with such information that is responsive to their request. Accordingly, in determining whether to approve the continuation of the Agreements between the Funds and Weitz Inc., the Board of Trustees requested, and Weitz Inc. provided, information and data relevant to the Board’s consideration. This included materials prepared by Weitz Inc. and materials prepared by an independent informational services firm that produced materials specifically for the Board that provided the Board with information regarding the investment performance of the Funds and information regarding the fees and expenses of the Funds, as compared to other similar mutual funds. As part of its deliberations, the Board also considered and relied upon information about the Funds and Weitz Inc. that they had received during the past year in connection with their regular Board meetings at which they engage in the ongoing oversight of the Funds and their operations.
The Board of Trustees most recently considered the continuation of the Agreements for each of the Funds at an in-person meeting held on May/24, 2018. At this meeting the Board engaged in a thorough review process in connection with determining whether to continue the Agreements. The Board met during the meeting directly with representatives of Weitz Inc. and reviewed various factors with them concerning the proposed continuation of the Agreements. As discussed more fully below, among the factors considered by the Board were: (1) the nature, extent and quality of the advisory services provided, including the investment performance of the Funds; (2) the cost of advisory services provided and the expected level of profitability, which included comparative information on fees and expenses borne by other similar mutual funds; (3) the extent to which economies of scale may be realized as the Funds grow and whether the advisory fees reflect possible economies of scale; (4) benefits to Weitz Inc. from its relationship with the Funds (and any corresponding benefits to the Funds); and (5) such other considerations deemed appropriate by the Board in making an informed business decision regarding the continuation of the Agreements.
With respect to the equity funds managed by Weitz Inc., consisting of Value Fund, Partners Value Fund, Partners III Opportunity Fund and Hickory Fund (the “Equity Funds”), the Board noted the applicable investment objectives, strategies and fee arrangements for each Equity Fund and also noted Weitz Inc.’s investment expertise and the investment strategies utilized by the firm with respect to each Equity Fund. Among the factors the Board considered for each Equity Fund was the overall performance of each Fund relative to other similar mutual funds on a long-term basis and over shorter time periods. The Board discussed with the representatives of management the fact that Weitz Inc. maintains a particular focus on long-term investment performance results and they reviewed the reasons why this may, from time to time, cause the longer-term performance results and the shorter-term performance results to compare differently when compared to similar funds for similar time periods. In connection with this, the Board took note of management’s stated position that achieving favorable long-term investment results is a primary objective of the firm and that as a result of this emphasis on longer-term results, shorter-term results which lag their peers and their relative indices are likely to occur from time to time over various investment cycles.
In addition, the Board compared expenses of each Equity Fund to the expenses of other similar funds, noting that the total expenses for the Equity Funds were generally higher than industry averages for total operating expenses of other funds of similar size and with similar investment objectives. In considering the investment advisory fees applicable to each Equity Fund, the Board discussed with the representatives of Weitz Inc. their reasons for assessing the applicable fees in connection with each Equity Fund, and the Board considered and discussed the fees charged by similar funds in each respective investment category. The Board also considered the fact that the investment advisory fees for each Equity Fund are subject to breakpoints which result in reduced investment advisory fees as assets increase. The members of the Board also reviewed matters with respect to the terms of the Expense Limitation Agreements that are in effect between the Value Fund and the Partners Value Fund and Weitz Inc., and it was noted that Weitz Inc. was proposing to extend the term of the Expense Limitation Agreements for another year.
The Board also reviewed matters with respect to the proposed continuation of the Agreement for the Balanced Fund. The Board reviewed the fees and expenses for the Balanced Fund, including the investment advisory fee as proposed to be reduced from 0.70% to 0.65%, as well as performance information for the Balanced Fund. The Board discussed with the representatives of Weitz Inc. the proposed new investment advisory fee for the Balanced Fund, and it was noted that the Balanced Fund is not currently subject to breakpoints on its advisory fee. In connection with Weitz Inc.’s proposal to reduce the amount of the investment advisory fee that it receives from the Balanced Fund, Weitz Inc.’s representatives confirmed to the Board that Weitz Inc. undertakes to not reduce the level or quality of the investment management services that it provides to the Balanced Fund following the reduction in the amount of the investment advisory fee. Management reviewed with the Board the fact that the Fund utilizes an investment style that combines equity investments and fixed income investments. Management indicated that they would be willing to consider the introduction of breakpoints for the Balanced Fund in the event that assets in the Fund were to become more substantial and economies of scale were able to be realized. The members of the Board also reviewed matters with respect to the terms of the Expense Limitation Agreement for the Balanced Fund, including a reduction in the contractual limitation from 0.95% to 0.85%, and it was noted that Weitz Inc. was proposing to extend the term of the Expense Limitation Agreement, as modified, for another year.
The members of the Board further considered various matters with respect to each of the income funds managed by Weitz Inc. consisting of the Core Plus Income Fund, the Short Duration Income Fund, the Ultra Short Government Fund and the Nebraska Tax-Free Income Fund (the “Income Funds”), noting the applicable investment objectives, strategies and fee arrangements for each Income Fund, and noting Weitz
 
66  |  Q3 2018 SEMI-ANNUAL REPORT

 
Inc.’s investment expertise and the investment strategies utilized by the firm with respect to each of the Income Funds. Among the factors the Board considered was the overall performance of each Income Fund relative to other similar funds on a long-term basis and over shorter time periods, taking into consideration the fact that: (i) the Core Plus Income Fund commenced operations on July 31, 2014 and (ii) the Ultra Short Government Fund had operated as a “government money market fund” until December 16, 2016. In addition, the Board compared expenses of each Income Fund to the expenses of other similar funds, noting that the expenses for each Income Fund compare favorably with industry averages for other funds of similar size and with similar investment objectives. In considering the investment advisory fees applicable to each Income Fund, the Board discussed with the representatives of Weitz Inc. their reasons for assessing the applicable fees in connection with each Income Fund, and the Board considered and discussed the fees charged by similar funds in each respective investment category. The members of the Board also reviewed matters with respect to the terms of the Expense Limitation Agreements that are in effect between certain of the Income Funds and Weitz Inc. and it was noted that Weitz Inc. was proposing to extend the term of the Expense Limitation Agreements for another year.
The Board also reviewed with representatives of Weitz Inc. various other factors relating to the management of the Funds. The Board took note of the long-term relationship between Weitz Inc. and the Funds and the efforts that have been undertaken by Weitz Inc. to foster the growth and development of the Funds since the inception of each Fund. They also noted the range of investment advisory, shareholder servicing and administrative services provided by Weitz Inc. to the Funds and the level and quality of these services, and in particular, they noted the quality of the personnel providing these services and determined that the quality of the services was very high. The members of the Board also took note of the fact that Weitz Inc. has undertaken to pay from its own resources the distribution expenses of the Funds, including those third-party intermediary expenses that are deemed to be distribution related, and they took into consideration the increased marketing efforts that Weitz Inc. has continued to undertake for the Funds and which it has continued to finance from its own resources.
The Board also reviewed financial information concerning Weitz Inc. relating to its operation of the Funds, noting the overall profitability of the relationship with the Funds to Weitz Inc., and the financial soundness of Weitz Inc. as demonstrated by the financial information provided, and reached a finding that the level of profitability was consistent with relevant industry averages and not excessive. In reviewing the profitability of Weitz Inc. relating to its management of the Funds, the Board reviewed the level of profitability including the various marketing and distribution expenses that are borne directly by Weitz Inc. and they also considered the level of profitability without taking into consideration the impact of these marketing and distribution costs. The members of the Board also considered and reviewed with the representatives of Weitz Inc. the cost allocation practices employed with respect to the Funds and determined that the cost allocation methods are reasonable and appropriately reflect the costs of services that are provided to the Funds.
The Board further reviewed Weitz Inc.’s brokerage practices, including its soft dollar practices and best-execution procedures, and noted that these were reasonable and consistent with standard industry practice. The Board took note of the current portfolio managers for each of the Funds and their overall management of each of the Funds. The members of the Board also took into consideration the way in which Weitz Inc. has been carefully planning and implementing portfolio management transition arrangements. The Board also considered information regarding the fees that Weitz Inc. charges other clients for investment advisory services that are similar to the advisory services provided to the Funds, and it was noted that the fees were comparable based on the relevant circumstances of the types of accounts involved.
In considering information regarding the investment management fees payable by the Funds to Weitz Inc. under the Agreements, the Board also took note of the administration fees that are payable by the Funds to Weitz Inc. under the terms of the separate Administration Agreements that are applicable to the Funds. In considering the approval of each of the Administration Agreements, the Board members indicated that they had considered various factors with respect to the administration fees, including the level and amount of these fees and the services provided by Weitz Inc. in connection with the Administration Agreements, in determining the reasonableness of the total fees paid by the Funds to Weitz Inc. for the overall level of services that Weitz Inc. provides to the Funds and their shareholders. In considering the nature and extent of these non-advisory administrative services provided to the Funds by Weitz Inc., the Board took into consideration: (i) whether the Administration Agreements are in the best interest of the Funds and their shareholders; (ii) whether the services performed under the Administration Agreements are required for the operation of the Funds; (iii) whether the services provided are of a nature and quality at least equal to the same or similar services provided by independent third parties; and (iv) whether the fees for the services are fair and reasonable in light of the usual and customary charges made by others for services of the same nature and quality.
The Board also took into consideration the fact that an affiliate of Weitz Inc., Weitz Securities, Inc., provides underwriting and distribution services to the Funds. The Board noted that Weitz Securities, Inc. provides useful services to the Funds in a highly effective manner that benefits the Funds and their shareholders. The Board further took into consideration that Weitz Securities, Inc. does not charge the Funds any fees for its services as distributor and that Weitz Inc. has undertaken to bear from its own resources the operating expenses of Weitz Securities, Inc. The members of the Board also took note of the fact that Weitz Inc. pays for all of the marketing and distribution efforts related to the offer and sale of the Funds and they considered the nature and extent of the revenue sharing payments that Weitz Inc. makes to those third party intermediaries that provide various types of distribution related services to the Funds, noting these payments are made entirely from Weitz Inc.’s own financial resources and are not paid by the Funds.
In connection with these matters, the Board also took into consideration the Shareholder Administrative Services Plans that are applicable to those Funds that have a dual share class structure and they took note of the level and amount of the fees payable pursuant to the Shareholder Administrative Services Plans, including those amounts payable to Weitz Inc. for providing the types of non-distribution shareholder administrative services that are eligible to be compensated under the terms of the Shareholder Administrative Services Plans.
In reaching their conclusion with respect to the continuation of the Agreements for each Fund and the level of investment advisory fees payable under the Agreements for each Fund, the Trustees did not identify any one single factor as being controlling, rather, the Board took note of a combination of factors that influenced their decision making process. The Board did, however, identify the overall performance results of the Funds, the commitment of Weitz Inc. and its affiliates to the successful operation of the Funds, and the level of expenses of the Funds, as being important elements of their consideration, as well as Weitz Inc.’s willingness to waive fees and/or reimburse expenses of certain of the Funds, as necessary, in order to limit their overall operating expenses. They noted the overall level and quality of the investment advisory, shareholder servicing, administration and distribution services provided by Weitz Inc. and its affiliates to the Funds and they found that these services continued to benefit the shareholders of the Funds and reflected the firm’s overall commitment to the continued successful growth and development of the Funds. The members of the Board also took into consideration the effectiveness of the compliance program maintained with respect to the Funds and Weitz Inc. and the compliance oversight process. The Board also took into consideration their discussions with Weitz Inc.’s representatives regarding the factors that have impacted the performance of the Funds on a short-term basis and over longer time periods. Based upon their review and consideration of these factors and other matters deemed relevant by the Board in reaching an informed business judgment, a majority of the Board of Trustees, including a majority of the Independent Trustees, concluded that the terms of the Management and Investment Advisory Agreements are fair and reasonable and the Board voted to renew the Agreements for an additional one-year period.
 
67  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
In reaching these conclusions, the members of the Board, including all of the Independent Trustees, took into consideration the following factors:
The nature, extent and quality of the advisory services provided. The Trustees concluded that Weitz Inc. is capable of providing high quality services to the Funds, as indicated by the nature, extent and quality of the services provided in the past by Weitz Inc. to each of the Funds, Weitz Inc.’s management capabilities demonstrated with respect to the Funds, the professional qualifications and experience of each of the portfolio managers of the Funds, and Weitz Inc.’s investment management and compliance oversight processes. On the basis of the Trustees’ assessment of the nature, extent and quality of the advisory services provided by Weitz Inc., the Trustees concluded that Weitz Inc. is capable of generating a level of long-term investment performance that is appropriate in light of the Funds’ investment objectives, policies and strategies.
The investment performance of the Funds. The Board received and reviewed performance information for each of the Funds separately, including total return performance information, for applicable one-, three-, five- and ten-year periods ended March 31, 2018, and for shorter periods as applicable, with respect to the Funds’ shares. The Board also reviewed with the representatives of Weitz Inc. other information and data, including each Fund’s performance against its primary benchmark index and its peer funds as follows:
1. Value Fund. The Board first reviewed information and materials regarding the performance results for the Value Fund, noting that the Investor Shares of the Fund had underperformed its primary benchmark index, the S&P 500 Index, for the one-year, three-year, five-year and ten-year periods ended March 31, 2018. The Board also noted that the Investor Shares of the Fund had underperformed its peer group median for the one-, three-, five- and ten-year periods ended March 31, 2018. The Trustees also took into consideration their discussions with Weitz Inc.’s representatives regarding the factors that have impacted the performance of the Fund on a short-term basis and over longer time periods.
2. Partners Value Fund. The Board next reviewed information and materials regarding the performance results for Partners Value Fund, noting that the Investor Shares of the Fund had underperformed its primary benchmark index, the S&P 500 Index, for the one-year, three-year, five-year and ten-year periods ended March 31, 2018. The Board also noted that the Investor Shares of the Fund had underperformed its peer group median for the one-, three-, five- and ten-year periods ended March 31, 2018. The Trustees also took into consideration their discussions with Weitz Inc.’s representatives regarding the factors that have impacted the performance of the Fund on a short-term basis and over longer time periods.
3. Partners III Opportunity Fund. The Board then reviewed information and materials regarding the performance results for Partners III Opportunity Fund and noted that the Institutional Shares of the Fund had underperformed its primary benchmark index, the S&P 500 Index, for the one-year, three-year, five-year and ten-year periods ended March 31, 2018. The Board also noted that the Institutional Shares of the Fund had underperformed its peer group median for the one- and three-year periods ended March 31, 2018, and outperformed its peer group median for the five- and ten-year periods ended March 31, 2018. The Trustees also took into consideration their discussions with Weitz Inc.’s representatives regarding the factors that have impacted the performance of the Fund on a short-term basis and over longer time periods.
4. Hickory Fund. The Board then reviewed information and materials regarding the performance results for Hickory Fund, noting that the Fund had underperformed its primary benchmark index, the Russell 2500 Index, for the one-, three-, five- and ten-year periods ended March 31, 2018. The Board also noted that the Fund had underperformed its peer group median for the one-, three-, five- and ten-year periods ended March 31, 2018. The Trustees also took into consideration their discussions with Weitz Inc.’s representatives regarding the factors that have impacted the performance of the Fund on a short-term basis and over longer time periods.
5. Balanced Fund. The Board next reviewed information and materials regarding the performance results for the Balanced Fund and the Board noted that the Fund had underperformed its primary benchmark index, the S&P 500 Index, as well as a secondary blended index consisting of 60% of the S&P 500 Index and 40% of the Barclays Intermediate U.S. Government/Credit Index, for the one-, three-, five- and ten-year periods ended March 31, 2018. The Board also noted that the Fund had underperformed its peer group median for the three- and five-year periods ended March 31, 2018, but had outperformed its peer group median for the one- and ten-year periods ended March 31, 2018. The Trustees also took into consideration their discussions with Weitz Inc.’s representatives regarding the factors that have impacted the performance of the Fund on a short-term basis and over longer time periods.
6. Core Plus Income Fund. The Board then reviewed information and materials regarding the performance results for the Core Plus Income Fund, noting that the Institutional Shares of the Fund, which commenced operations as of July 31, 2014, had outperformed its primary benchmark index, the Bloomberg Barclays U.S. Aggregate Bond Index, for the one-, three-year and since inception periods ended March 31, 2018. The Board also noted that the Institutional Shares of the Fund had underperformed its peer group median for the one-year period ended March 31, 2018 but had outperformed its peer group median for the three-year period ended March 31, 2018.
7. Short Duration Income Fund. The Board next reviewed information and materials regarding the performance results for the Short Duration Income Fund and the Board noted that the Institutional Shares of the Fund had outperformed its primary benchmark index, the Bloomberg Barclays U.S. Aggregate 1-3 Year Index, for the one-, three-, five- and ten-year periods ended March 31, 2018. The Board noted that the Institutional Shares of the Fund had outperformed its peer group median for the one-, three-, five- and ten-year periods ended March 31, 2018.
8. Ultra Short Government Fund. The Board next reviewed information and materials regarding the performance results for the Ultra Short Government Fund, noting that the Fund had underperformed its primary benchmark index, the Bank of America Merrill Lynch 6-Month Treasury Bill Index, for the one-, three-, five- and ten-year periods ended March 31, 2018. The Board also noted that the Fund had underperformed its peer group median for the one-, three-, five- and ten-year periods ended March 31, 2018. In connection with the Board’s review of the performance results presented for the Ultra Short Government Fund, the members of the Board took into consideration the fact that prior to December 16, 2016, the Ultra Short Government Fund had been operated as a government money market fund and, as a result, the performance returns for each of the periods prior to that date were achieved while the Fund was operated as a government money market fund with investment objectives and strategies that are different from the investment objectives and strategies that the Fund implemented effective as of December 16, 2016.
9. Nebraska Tax-Free Income Fund. The Board then reviewed information and materials regarding the performance results for the Nebraska Tax-Free Income Fund, noting that the Fund had underperformed its primary benchmark index, the Bloomberg Barclays 5-Year Municipal Bond Index, for the one-, three-, five- and ten-year periods ended March 31, 2018. The Board also noted that the Fund had underperformed its peer group median for the one-, three-, five- and ten-year periods ended March 31, 2018. The Trustees also took into consideration their discussions with Weitz Inc.’s representatives regarding the factors that have impacted the performance of the Fund on a short-term basis and over longer time periods.
The cost of advisory services provided and the expected level of profitability. The Board considered the advisory fees and overall expenses of the Funds (including Institutional Shares and the Investor Shares of the Funds, as applicable) based upon the relevant information presented, as compared to the advisory fees and overall expenses of other mutual funds in each respective Fund’s designated peer group as follows:
 
68  |  Q3 2018 SEMI-ANNUAL REPORT

 



1. Value Fund. The Board first reviewed expense information and materials for Value Fund, noting that the Agreement provided for an investment advisory fee for the Fund at a rate of 0.90% on the Fund’s assets that are less than or equal to $1 billion, with various breakpoints in the investment advisory fee on differing levels of assets in the Fund in excess of $1 billion, which was above median compared to its peer funds. The Board also noted that the net expense ratio of the Fund’s Institutional Shares was 0.99%, which is above the median net expense ratio of its peer funds.
2. Partners Value Fund. The Board next reviewed expense information and materials for Partners Value Fund, and the Board noted that the Agreement provided for an investment advisory fee for the Fund at a rate of 0.90% on the Fund’s assets that are less than or equal to $1 billion, with breakpoints in the investment advisory fee on differing levels of assets in the Fund in excess of $1 billion, which was above median compared to its peer funds. The Board also noted that the net expense ratio of the Fund’s Institutional Shares was 0.99%, which is lower than the median net expense ratio of its peer funds.
3. Partners III Opportunity Fund. The Board then reviewed expense information and materials for Partners III Opportunity Fund, noting that the Agreement provided for an investment advisory fee for the Fund at a rate of 1.00% on the Fund’s assets that are less than or equal to $1 billion, with breakpoints in the investment advisory fee on differing levels of assets in the Fund in excess of $1 billion, which was lower than median compared to its peer funds. The Board also noted that the net expense ratio of the Fund’s Institutional Shares (exclusive of the dividend and interest expense incurred by the Fund during the fiscal year) was 1.16%, which is lower than the median net expense ratio of its peer funds.
4. Hickory Fund. The Board then reviewed expense information and materials for Hickory Fund, noting that the Agreement provided for an investment advisory fee for the Fund at a rate of 1.00% on the Fund’s assets that are less than or equal to $2.5 billion, with breakpoints in the investment advisory fee on differing levels of assets in the Fund in excess of $2.5 billion, which was above median compared to its peer funds. The Board also noted that the net expense ratio of the Fund was 1.24%, which is above the median net expense ratio of its peer funds.
5. Balanced Fund. The Board then reviewed expense information and materials for the Balanced Fund and the Board noted that the Agreement provided for an amended investment advisory fee for the Fund at a rate of 0.65% of the Fund’s assets (to become effective as of July 31, 2018), and this new 0.65% fee rate was in line with median compared to its peer funds. The Board also noted that the net expense ratio of the Fund was 0.85% (taking into account the amended investment advisory fee and the modification to the Fund’s Expense Limitation Agreement), which was lower than the median net expense ratio of its peer funds.
6. Core Plus Income Fund. The Board next reviewed expense information and materials for the Core Plus Income Fund, noting that the Agreement provided for an investment advisory fee for the Fund at a rate of 0.40% on the Fund’s assets, which was below median compared to its peer funds. The Board also noted that the net expense ratio of the Fund’s Institutional Shares was 0.40%, which is lower than the median net expense ratio of its peer funds.
7. Short Duration Income Fund. The Board next reviewed expense information and materials for Short Duration Income Fund and the Board noted that the Agreement provided for an investment advisory fee for the Fund at a rate of 0.40% on the Fund’s assets, which was below median compared to its peer funds. The Board also noted that the net expense ratio of the Fund’s Institutional Shares was 0.48%, which is lower than the median net expense ratio of its peer funds.
8. Ultra Short Government Fund. The Board next reviewed expense information and materials for the Ultra Short Government Fund and the Board noted that the Agreement provided for an investment advisory fee for the Fund at a rate of 0.30% on the Fund’s assets, which was in line with median compared to its peer funds. The Board also noted that the net expense ratio of the Fund was 0.20%, which was lower than the median net expense ratio of its peer funds.
9. Nebraska Tax-Free Income Fund. The Board next reviewed expense information and materials for the Nebraska Tax-Free Income Fund, noting that the Agreement provided for an investment advisory fee for the Fund at a rate of 0.40% on the Fund’s assets, which was below median of its peer funds. The Board also noted that the net expense ratio of the Fund (exclusive of the acquired fund fees and expenses incurred by the Fund during the fiscal year) was 0.84%, which was in line with the median net expense ratio of its peer funds.
On the basis of the fee and expense information provided, the Board determined that the investment management fees payable by the Funds to Weitz Inc. are reasonable and that Weitz Inc.’s level of profitability from its management of each of the Funds is reasonable and not excessive.
The extent to which economies of scale may be realized as the Funds grow and whether the advisory fees reflect possible economies of scale. The Trustees took into consideration that each of the Equity Funds are currently operated pursuant to investment management fees that are subject to breakpoints on the fees as assets in the Equity Funds increase over various established levels of assets. In addition, while it was noted that the investment advisory fees for the Income Funds and for the Balanced Fund will not decrease as the Funds’ assets grow because they are not subject to investment advisory fee breakpoints, the Trustees concluded that the Funds’ investment advisory fees are appropriate in light of the size of the Funds, and appropriately reflect the current economic environment for Weitz Inc. and the competitive nature of the mutual fund marketplace. The Trustees then noted that they will have the opportunity to periodically re-examine whether any of these Funds have achieved economies of scale, and the appropriateness of the investment advisory fees payable to Weitz Inc. with respect to the Income Funds and the Balanced Fund, in the future at which time the implementation of fee breakpoints on these particular Funds could be further considered.
Benefits to Weitz Inc. from its relationship with the Funds (and any corresponding benefits to the Funds). The Trustees concluded that other benefits that may be derived by Weitz Inc. from its relationship with the Funds, including “soft dollar” benefits in connection with Fund brokerage transactions and use of the Funds’ performance track record in advertising materials, are reasonable and fair, and consistent with industry practice and the best interests of the Funds and their shareholders. In addition, the Trustees determined that the Funds benefit from their relationship with Weitz Inc. by virtue of Weitz Inc.’s provision of administrative and shareholder services, in addition to investment advisory services, at a cost to the Funds that is generally comparable to the costs of an outside service provider, which the Trustees determined to be reasonable, fair and in the best interests of the shareholders of the Funds in light of the nature and quality of the services provided and the necessity of the services for the Funds’ operations.
Other Considerations. In approving the continuation of the Agreements, the Trustees determined that Weitz Inc. has made a substantial commitment to the recruitment and retention of high quality personnel, and maintains the financial, compliance and operational resources reasonably necessary to manage the Funds in a professional manner that is consistent with the best interests of the Funds and their shareholders. The Board also acknowledged the experience and expertise of members of the Weitz Inc. management team and the focus these individuals have on ensuring that the Funds operate successfully. The Trustees also concluded that Weitz Inc. has made a significant entrepreneurial commitment to the management and success of the Funds, which entails a substantial financial and professional commitment, including the Expense Limitation Agreements under which Weitz Inc. has undertaken to waive a portion of its fees and to reimburse expenses of certain of the Funds to the benefit of Fund shareholders to the extent necessary in accordance with the terms of the Expense Limitation Agreements. The Board also considered matters with respect to the brokerage practices of Weitz Inc., including its soft dollar arrangements and its best-execution procedures, and noted that these were reasonable and consistent with standard industry practice.
 
69  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED




INDEX DESCRIPTIONS
   
Russell 1000® 
The Russell 1000 Index measures the performance of the large-cap segment of the U.S. equity 
 
universe. It is a subset of the Russell 3000 Index and includes approximately 1,000 of the largest 
 
securities based on a combination of their market cap and current index membership. 
 
Russell 1000® Value 
The Russell 1000 Value Index measures the performance of the large-cap value segment of the U.S. 
 
equity universe. It includes those Russell 1000 companies with lower price-to-book ratios and lower 
 
expected growth values. 
 
Russell 3000® 
The Russell 3000 Index measures the performance of the largest 3,000 U.S. companies representing 
 
approximately 98% of the investable U.S. equity market. 
 
Russell 3000® Value 
The Russell 3000 Value Index measures the performance of the broad value segment of the U.S. 
 
equity value universe. It includes those Russell 3000 companies with lower price-to-book ratios and 
 
lower forecasted growth values. 
 
Russell 2500TM 
The Russell 2500 Index measures the performance of the small to mid-cap segment of the U.S. 
 
equity universe, commonly referred to as “SMID” cap. The Russell 2500 Index is a subset of the 
 
Russell 3000 Index. It includes approximately 2,500 of the smallest securities based on a combination 
 
of their market cap and current index membership. 
 
Russell 2500TM Value 
The Russell 2500 Value Index measures the performance of the small to mid-cap value segment of 
 
the U.S. equity universe. It includes those Russell 2500 companies that are considered more value 
 
oriented relative to the overall market as defined by Russell. 
 
S&P 500® 
The S&P 500 is an unmanaged index consisting of 500 companies generally representative of 
 
the/market for the stocks of large-size U.S. companies. 
 
Moderately 
The Morningstar Moderately Conservative Target Risk Index is an asset allocation index comprised 
Conservative 
of constituent Morningstar indices and reflects global equity market exposure of 40% based on an 
 
asset allocation methodology derived by Ibbotson Associates, a Morningstar company. 
 
Blended 
The Blended Index blends the S&P 500 with the Bloomberg Barclays Intermediate U.S. 
 
Government/Credit Index by weighting their total returns at 60% and 40%, respectively. The 
 
portfolio is rebalanced monthly. 
 
Bloomberg Barclays 
The Bloomberg Barclays U.S. Aggregate Bond Index is a broad-based benchmark that measures the 
U.S. Aggregate Bond 
investment grade, U.S. dollar-denominated, fixed-rate taxable bond market. 
 
Bloomberg Barclays 
The Bloomberg Barclays 1-3 Year U.S. Aggregate Index is generally representative of the market for 
1-3 Year U.S. Aggregate 
investment grade, U.S. dollar denominated, fixed-rate taxable bonds with maturities from one to 
 
three years. 
 
Bloomberg Barclays 
The Bloomberg Barclays Intermediate U.S. Government/Credit Index (“BIGC”) is the non- 
Intermediate U.S. 
securitized portion of the U.S. Aggregate Index and includes Treasuries, government-related issues 
Government/Credit 
and corporates with maturities from one to ten years. 
 
CPI + 1% 
The CPI + 1% is created by adding 1% to the annual percentage change in the Consumer Price Index 
 
(“CPI”) as determined by the U.S. Department of Labor Statistics. There can be no guarantee that 
 
the CPI will reflect the exact level of inflation at any time. 
 
ICE BofAML US 
The ICE BofAML US 6-Month Treasury Bill Index is an unmanaged index that is generally 
6-Month Treasury Bill 
representative of the market for U.S. Treasury Bills. 
 
Bloomberg Barclays 
The Bloomberg Barclays 5-Year Municipal Bond Index is a capitalization weighted bond index 
5-Year Municipal Bond 
created by Bloomberg Barclays intended to be representative of major municipal bonds of all quality 
 
ratings with an average maturity of approximately five years. 
 
 
70  |  Q3 2018 SEMI-ANNUAL REPORT


 
Board of Trustees 
Distributor 
Lorraine Chang 
Weitz Securities, Inc. 
John W. Hancock 
 
Thomas R. Pansing, Jr. 
Transfer Agent and Dividend 
Roland J. Santoni 
Paying Agent 
Delmer L. Toebben 
Weitz Investment Management, Inc. 
Wallace R. Weitz 
 
Justin B. Wender 
 
 
Sub-Transfer Agent 
Investment Adviser 
DST Asset Manager Solutions, Inc. 
Weitz Investment Management, Inc. 
 
1125 South 103rd Street, Suite 200 
NASDAQ symbols: 
Omaha, NE 68124-1071 
Value Fund 
(800) 304-9745 
Investor Class - WVALX 
 
Institutional Class - WVAIX 
Custodian 
Partners Value Fund 
State Street Bank and Trust Company 
Investor Class - WPVLX 
Institutional Class - WPVIX 
Officers 
Partners III Opportunity Fund 
Wallace R. Weitz, President 
Investor Class - WPOIX 
Thomas D. Carney, Vice President 
Institutional Class - WPOPX 
John R. Detisch, Vice President, General Counsel, 
Hickory Fund - WEHIX 
Secretary & Chief Compliance Officer 
Balanced Fund - WBALX 
Bradley P. Hinton, Vice President 
Core Plus Income Fund 
Kenneth R. Stoll, Vice President & Chief 
Investor Class - WCPNX 
Financial Officer 
Institutional Class - WCPBX 
Andrew S. Weitz, Vice President 
Short Duration Income Fund 
Investor Class - WSHNX 
Institutional Class - WEFIX 
 
Ultra Short Government Fund - SAFEX 
 
Nebraska Tax-Free Income Fund - WNTFX 
 
Help us conserve resources by receiving your report electronically.
Visit us online at weitzinvestments.com.
Simply log in to your account and select “Electronic Delivery.”
An investor should consider carefully the investment objectives, risks, and charges and expenses of the Funds before investing. The Funds’ Prospectus contains this and other information about the Funds. The Prospectus should be read carefully before investing.
11/9/18
 
71  |  Q3 2018 SEMI-ANNUAL REPORT   |   UNAUDITED

 
Item 2. Code of Ethics.
Not required for Semi-Annual Report.
Item 3. Audit Committee Financial Expert.
Not required for Semi-Annual Report.
Item 4. Principal Accountant Fees and Services.
Not required for Semi-Annual Report.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Schedule of Investments.
The Schedule of Investments in Securities of unaffiliated issuers is included as part of the Report to Shareholders filed under Item 1.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 10. Submissions of Matters to a Vote of Security Holders.
Not applicable.
Item 11. Controls and Procedures.
(a) Based on an evaluation of the Disclosure Controls and Procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) (the "Disclosure Controls") as of a date within 90 days prior to the filing date (the "Filing Date") of this report on Form N-CSR (the "Report"), the Registrant's principal executive officer and principal financial officer have concluded that the Disclosure Controls are reasonably designed to ensure that information required to be disclosed by the Registrant in the Report is recorded, processed, summarized and reported by the Filing Date, including ensuring that information required to be disclosed in the Report is accumulated and communicated to the Registrant's management, including the Registrant's principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
(b) There were no changes in the Registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the Registrant's second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting.

 
Item 12. Exhibits
(a)(1) Not applicable.
(a)(2) The certifications required by Rule 30a-2(a) of the Investment Company Act of 1940 are attached hereto.
(a)(3) Not applicable.
(b)  The certifications required by Rule 30a-2(b) of the Investment Company Act of 1940 and Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

The Weitz Funds

By (Signature and Title)*
 /s/ Wallace R. Weitz
Wallace R. Weitz, President

Date: November 9, 2018

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.


By: (Signature and Title)*
 /s/ Wallace R. Weitz
Wallace R. Weitz, President

Date: November 9, 2018


By: (Signature and Title)*
 /s/ Kenneth R. Stoll
Kenneth R. Stoll, Chief Financial Officer

Date: November 9, 2018


* Print the name and title of each signing officer under his or her signature.
 
[EX-99.CERT]
Exhibit (a)(2)
SECTION 302 CERTIFICATIONS
I, Wallace R. Weitz, President of The Weitz Funds, certify that:
1.
I have reviewed this report on Form N-CSR of The Weitz Funds;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the Registrant as of, and for, the periods presented in this report;
4.
The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
(a)
Designed such disclosure controls and procedures, or caused such  disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)          Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)
Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
(d)
Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal half-year (the Registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and
5.
The Registrant's other certifying officer and I have disclosed to the Registrant's auditors and the audit committee of the Registrant's board of trustees (or persons performing the equivalent functions):
(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize, and report financial information; and
(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting. 
By:  /s/ Wallace R. Weitz
       Wallace R. Weitz
        President

Date: November 9, 2018
 

    [EX-99.CERT]
Exhibit (a)(2)
SECTION 302 CERTIFICATIONS
I, Kenneth R. Stoll, Principal Financial Officer of The Weitz Funds, certify that:
1.
I have reviewed this report on Form N-CSR of The Weitz Funds;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the Registrant as of, and for, the periods presented in this report;
4.
The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
(a)
Designed such disclosure controls and procedures, or caused such  disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)          Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)
Evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
(d)
Disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the Registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and
5.
The Registrant's other certifying officer and I have disclosed to the Registrant's auditors and the audit committee of the Registrant's board of trustees (or persons performing the equivalent functions):
(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize, and report financial information; and
(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting. 
By: /s/ Kenneth R. Stoll
       Kenneth R. Stoll
       Chief Financial Officer

Date: November 9, 2018

[EX.-99.906CERT]
Exhibit (b)
SECTION 906 CERTIFICATIONS
In connection with this report on Form N-CSR for the Registrant as furnished to the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned hereby certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1)
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as applicable; and
 (2)
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

By:   /s/ Wallace R. Weitz
         Wallace R. Weitz
         President
Date: November 9, 2018
 
By:  /s/ Kenneth R. Stoll
         Kenneth R. Stoll
         Chief Financial Officer
Date: November 9, 2018




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