Volatile returns are the side effect of running a concentrated portfolio.
That is why running a concentrated portfolio does not necessarily fit well with a traditional mutual fund as periods of underperformance lead to investors redeeming.
Goodhaven Fund is run by Larry Pitkowsky and Keith Trauner, and the portfolio is quite concentrated.
Currently Goodhaven really likes Walter Energy (WLTGQ, Financial), WPX Energy (WPX, Financial) and Barrick Gold (ABX, Financial).