Quarterly Schedule of Portfolio Holdings of Registered Management Investment Company (n-q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

 

Investment Company Act file number           811-08897  

 

Sparrow Funds

(Exact name of registrant as specified in charter)

 

211 N. Broadway,  Ste. 2080, St. Louis, MO         63102

  (Address of principal executive offices)          (Zip code)

Mutual Shareholder Services

8000 Towne Centre Drive, Suite 400

Broadview Heights, OH 44147

(Name and address of agent for service)

 

Registrant's telephone number, including area code:   314-725-6161

 

Date of fiscal year end:  08/31

 

Date of reporting period:	11/30/2013

 

 

Form N-Q is to be used by management investment companies, other than small business investment

companies registered on Form N-5 (§§ 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.

 

A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q 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 the 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. Schedule of Investments.

			Sparrow Growth Fund
			Schedule of Investments
			November 30, 2013 (Unaudited)
	Shares			Fair Value
COMMON STOCKS - 100.17%
	Auto Parts - 1.11%
	9,200		Federal Signal Corp. *	$        143,796
	Beverages - 2.38%
	650		Boston Beer Co., Inc.  Class-A *	159,120
	2,130		Constellation Brands, Inc. *	149,973
				309,093
	Biological Products (No Diagnostic Substances - 2.00%
	2,700		Catamaran Corp. *	123,201
	14,000		PDL BioPharma, Inc.	136,780
				259,981
	Biotechnology - 1.01%
	1,050		Alexion Pharmaceuticals, Inc. *	130,725
	Cable & Other Pay Television Services - 1.90%
	1,800		AMC Networks, Inc. *	115,542
	1,500		Discovery Communications, Inc. *	130,905
				246,447
	Carpets & Rugs - 1.52%
	1,170		Mohawk Industries, Inc. *	163,823
	2,600		The Dixie Group, Inc. *	33,748
				197,571
	Catalog & Mail Order Houses - 1.04%
	4,800		Overstock.com, Inc. *	134,400
	Cement - 1.09%
	1,820		Eagle Materials, Inc.	141,960
	Commodity, Contracts, Brokers & Dealers - 0.94%
	7,975		Wisdom Tree Investments, Inc. *	122,177
	Computer Storage Devices - 1.00%
	1,900		SanDisk Corp.	129,485
	Confectioners - 0.97%
	1,300		Hershey Co.	125,957
	Construction Special Trade Contractors  - 1.74%
	8,400		Furmanite Corp. *	94,920
	1,700		Chicago Bridge & Iron Co. N.V.	130,356
				225,276
	Consumer Goods - 2.07%
	2,400		SodaStream International, Ltd. *	137,952
	1,700		Sturm Ruger & Co.	130,781
				268,733
	Crude Petroleum & Natural Gas - 6.16%
	2,500		Bonanza Creek Energy, Inc. *	114,675
	1,330		Continental Resources, Inc. *	142,988
	6,900		Matador Resources Co. *	150,351
	780		Pioneer Natural Resources Co.	138,645
	4,700		Sanchez Energy Corp. *	120,649
	1,500		SM Energy Co.	132,210
				799,518
	Drilling Oil & Gas Wells - 0.88%
	3,000		Noble Corp.	114,360
	Electronic Connectors - 1.18%
	5,300		Methode Electronics, Inc.	153,329
	Engines & Turbines - 0.93%
	2,150		Dresser-Rand Group, Inc. *	121,346
	Entertainment-Diversified - 1.15%
	125		Priceline.com, Inc. *	149,041
	Financial Services - 0.81%
	11,500		GAIN Capital Holdings, Inc.	104,650
	Fire, Marine & Casualty Insurance - 3.78%
	2,400		Allstate Corp.	130,248
	4,570		Employers Holdings, Inc.	149,165
	4,100		Greenlight Capital Re, Ltd. *	139,441
	1,300		Selective Insurance Group, Inc.	36,647
	3,500		United Insurance Holdings Corp.	35,280
				490,781
	Food & Kindred Products - 2.10%
	7,100		Boulder Brands, Inc. *	108,701
	1,980		The Hain Celestial Group, Inc. *	163,726
				272,427
	Footwear - 1.20%
	4,620		Skechers USA, Inc. *	155,324
	Hospital & Medical Service Plans - 1.06%
	2,300		Centene Corp. *	137,379
	Hotels & Motels - 1.01%
	3,700		Melco Crown Entertainment, Ltd. *	131,683
	Industrial Inorganic Chemicals - 0.97%
	3,050		American Pacific Corp. *	126,118
	Industrial Organic Chemicals - 0.28%
	1,100		REX American Resources Corp. *	36,014
	Investment Advice - 1.16%
	725		Virtus Investment Partners, Inc. *	150,655
	Leather & Leather Products - 0.97%
	1,550		Michael Kors Holdings, Ltd. *	126,402
	Meat Products - 1.11%
	2,100		Sanderson Farms, Inc.	143,514
	Media Entertainment - 1.06%
	375		Netflix, Inc. *	137,175
	Mortgage Bankers &  Loan Correspondents - 2.16%
	2,730		Owen Financial Corp. *	154,682
	3,300		Walter Investment Management Corp. *	125,829
				280,511
	Motor Homes - 1.18%
	4,950		Winnebago Industries, Inc. *	153,252
	Motor Vehicle Parts & Accessories - 1.06%
	6,900		American Axle & Manufacturing Holdings, Inc. *	138,000
	National Commercial Banks - 0.56%
	4,100		Midsouth Bancorp, Inc.	73,021
	Natural Gas Distribution - 1.05%
	1,600		EQT Corp.	136,176
	Oil & Gas Field Machinery & Equipment - 0.92%
	4,400		Forum Energy Technologies, Inc. *	118,844
	Operative Builders - 4.06%
	7,500		KM Home	131,475
	4,886		MI Homes, Inc. *	147,199
	2,800		Meritage Homes Corp. *	122,024
	3,200		Ryland Group, Inc.	126,464
				527,162
	Paper Mills - 1.07%
	2,600		KapStone Paper & Packaging Corp.	138,528
	Paperboard Containers & Boxes - 0.80%
	1,100		Rock-Tenn Co.	103,862
	Personal Products - 1.28%
	1,300		Nu Skin Enterprises, Inc.	166,192
	Pharmaceutical Preparations - 4.22%
	2,500		Forest Laboratories, Inc. *	128,275
	2,700		Gentium S.p.A. *	146,394
	1,325		Jazz Pharmaceuticals Plc. *	154,919
	2,050		Questcor Pharmaceuticals, Inc.	118,921
				548,509
	Poultry Slaughtering & Processing - 1.14%
	9,000		Pilgrim's Pride Corp. *	147,420
	Radio & TV Broadcasting & Communications - 1.96%
	5,300		CalAmp Corp. *	132,182
	3,100		Ubiquiti Networks, Inc.	122,140
				254,322
	Railroads, Line-Haul Operating - 0.96%
	1,290		Genesee & Wyoming, Inc. Class-A *	124,098
	Recreation Vehicles - 1.26%
	1,230		Polaris Industries, Inc.	164,168
	Refrigeration & Service Industry Machine - 0.73%
	430		Middleby Corp. *	94,961
	Regional-Pacific Banks - 1.22%
	8,985		CU Bancorp. *	159,035
	Resorts & Casinos - 0.96%
	6,500		MGM Resorts International *	124,735
	Retail-Food Stores - 1.18%
	2,550		GNC Holdings Group	153,459
	Retail Stores - 1.14%
	375		Amazon.com, Inc. *	147,608
	Retail-Catalog & Mail-Order Houses - 1.02%
	1,600		Vipshop Holdings, Ltd. *	132,976
	Retail-Lumber & Other Building Materials Dealers - 0.85%
	1,100		Lumber Liquidators Holdings, Inc. *	110,759
	Retail-Radio TV & Consumer Electronics Stores - 1.07%
	2,300		Conns, Inc. *	138,759
	Security Brokers, Dealers & Flotation Companies - 0.59%
	3,900		Investment Technology Group, Inc. *	76,401
	Semiconductors & Related Devices - 2.17%
	6,500		Finisar Corp. *	134,485
	7,000		Micron Technology, Inc. *	147,700
				282,185
	Services-Business Services, NEC - 2.11%
	4,250		Envestnet, Inc. *	168,938
	5,940		PowerSecure International, Inc. *	104,365
				273,303
	Services-Computer Processing & Data Preparation - 1.60%
	2,600		Bitauto Holdings, Ltd. *	81,900
	2,500		YY, Inc. *	125,950
				207,850
	Services-Computer Programming Services - 1.09%
	2,800		Synaptics, Inc. *	141,428
	Services-Computer Programming, Data Processing, Etc. - 0.98%
	2,720		Facebook, Inc. *	127,867
	Services-Educational Services - 0.72%
	5,300		China Distance Education Holdings, Ltd.	92,989
	Services-Management Consulting Services - 1.14%
	4,000		CGI Group, Inc. *	147,560
	Services-Miscellaneous Business Services - 1.12%
	900		Altisource Portfolio Solutions S. A. *	144,882
	Services-Prepackaged Software - 2.04%
	2,200		ACI Worldwide, Inc. *	141,966
	7,500		Take-Two Interactive Software, Inc. *	122,700
				264,666
	Services-Specialty Outpatient Facilities - 1.17%
	3,300		Acadia Healthcare Co., Inc. *	152,460
	Special Industry Machinery, NEC - 0.96%
	2,400		Lam Research Corp. *	125,064
	Special Eateries - 0.74%
	1,180		Starbucks Corp.	96,123
	State Commercial Banks - 3.13%
	2,200		First Financial Holdings, Inc.	144,914
	3,600		Home Bancshares, Inc.	130,176
	7,630		OFG Bancorp.	131,236
				406,326
	Surety Insurance - 1.01%
	7,600		Old Republic International Corp.	130,720
	Telephone & Telegraph Apparatus - 0.98%
	5,700		Ciena Corp. *	126,597
	Television Broadcasting Stations - 1.26%
	3,300		Nexstar Broadcasting Group, Inc. Class-A	163,911
	Wholesale-Motor Vehicles & Motor Vehicle Parts & Supplies - 0.95%
	3,725		LKQ Corp. *	123,484
	TOTAL FOR COMMON STOCKS (Cost $11,673,876) - 100.17%			$    13,005,490
TOTAL INVESTMENTS (Cost $11,673,876) - 100.17%				$    13,005,490
LIABILITIES IN EXCESS OF OTHER ASSETS - 0.17%				(22,539)
NET ASSETS - 100.00%				$    12,982,951
	* Non-income producing security during the period
	** Variable rate security; the coupon rate shown represents the yield at November 30, 2013.
	NOTES TO FINANCIAL STATEMENTS
	Sparrow Growth Fund
	1. SECURITY TRANSACTIONS
	At November 30, 2013, the net unrealized appreciation on investments, based on cost for federal income tax purposes of $11,673,876 amounted to $1,331,614, which consisted of aggregate gross unrealized appreciation of $1,659,376 and aggregate gross unrealized depreciation of $327,762.
	2. SECURITY VALUATIONS
	As described in Note 2, all investments in securities are recorded at their estimated fair value. The Fund utilizes various methods to measure the fair value of most of its investments on a recurring basis. GAAP establishes a hierarchy that prioritizes inputs to valuation methods. The three levels of inputs are:
	Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.
	Level 2 - Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.
	Level 3 - Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumptions about the assumptions a market participant would use in valuating the asset or liability, and would be based on the best information available.
	The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in level 3.
	The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety, is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

Valuation Inputs of Assets		Level 1	Level 2	Level 3	Total
Common Stock		$13,005,490	$0	$0	$13,005,490
Total		$13,005,490	$0	$0	$13,005,490

Item 2. Controls and Procedures.

 

(a)       EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. The Registrant maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Registrant's filings under the Securities Exchange Act of 1934 and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission. Such information is accumulated and communicated to the Registrant's management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Registrant's management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Within 90 days prior to the filing date of this Quarterly Schedule of Portfolio Holdings on Form N-Q, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant's management, including the Registrant's principal executive officer and the Registrant's principal financial officer, of the effectiveness of the design and operation of the Registrant's disclosure controls and procedures. Based on such evaluation, the Registrant's principal executive officer and principal financial officer concluded that the Registrant's disclosure controls and procedures are effective.

 

(b)       CHANGES IN INTERNAL CONTROLS. There have been no significant changes in the Registrant's internal controls or in other factors that could significantly affect the internal controls subsequent to the date of their evaluation in connection with the preparation of this Quarterly Schedule of Portfolio Holdings on Form N-Q.

  Item 3. Exhibits.

 

Certifications by the registrant's principal executive officer and principal financial officer, pursuant to the Sarbanes- Oxley Act of 2002 and required by Rule 30a-2a under the Investment Company Act of 1940 are filed herewith.

 

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.

 

Registrant	Sparrow Funds

 

By:    * Gerald Sparrow

          Gerald Sparrow, President

 

Date	1/13/2014

 

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:    * Gerald Sparrow

          Gerald Sparrow, President and Treasurer

 

Date	1/13/2014