Nicholas Fund NCSR Certified annual shareholder report (management investment company)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT
COMPANIES

Investment Company Act file number811-01728


Nicholas Fund, Inc.

(Exact Name of Registrant as specified in charter)

411 East Wisconsin Avenue, Milwaukee, Wisconsin 53202
(Address of Principal Executive Offices)	(Zip Code)

Jennifer R. Kloehn, Senior Vice President and Treasurer
411 East Wisconsin Avenue
Milwaukee, Wisconsin 53202

(Name and Address of Agent for Service)

Registrant's telephone number, including area code:414-272-4650

Date of fiscal year end:03/31/2020

Date of reporting period:03/31/2020

Item 1. Report to Stockholders.

ANNUAL REPORT

March 31, 2020

NICHOLAS FUND, INC.

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund’s website, www.nicholasfunds.com, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund or your financial intermediary electronically by contacting your financial intermediary (such as a broker-dealer or bank); direct shareholders may call the Fund at 1-800-544-6547.

You may elect to receive all future reports in paper free of charge. You can inform the Fund or your financial intermediary that you wish to continue receiving paper copies of your shareholder reports by contacting your financial intermediary (such as a broker-dealer or bank); direct shareholders may call the Fund at 1-800-544-6547. Your election to receive reports in paper will apply to all funds held with the Fund complex or your financial intermediary.

WWW.NICHOLASFUNDS.COM

NICHOLAS FUND, INC.

May 2020

Dear Fellow Shareholders:

As I write this letter, much has changed since the end of March 2020. There is a global pandemic isolating many of us in our homes and leaving over 20,000,000 people out of work in the U.S. The U.S. stock market had the quickest occurring bear market in history followed by a strong rebound, as federal governments around the world pump money into their economies to soften the blow. Uncertainty abounds as we head into the remainder of this year and next year.

For the fiscal year ended March 31, 2020, Nicholas Fund returned -5.90% compared to -6.98% for the Standard & Poor’s 500 (“S&P 500”) Index and 0.91% for the Russell 1000 Growth Index. Returns for Nicholas Fund, Inc. and selected indices are provided in the chart below for the period ended March 31, 2020.


					Average Annual Total Return
		1	Year		3	Year		5	Year		10	Year	45	Year
Nicholas Fund, Inc.		-5.90	%		5.42	%		3.29	%		10.59	%	12.49	%
Standard & Poor’s 500 Index		-6.98	%		5.10	%		6.73	%		10.53	%	11.09	%
Russell 1000 Growth Index		0.91	%		11.32	%		10.36	%		12.97	%	n/a
Consumer Price Index		1.52	%		1.91	%		1.80	%		1.73	%	3.59	%
Ending value of $10,000 invested
in Nicholas Fund, Inc.	$	9,410		$	11,716		$	11,755		$	27,367	$	1,998,954
Fund’s Expense Ratio (from 07/30/19 Prospectus): 0.72%

Performance data quoted represents past performance and is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance of the Fund may be lower or higher than the performance quoted. Performance data current to the most recent month-end may be obtained by visiting www.nicholasfunds.com/returns.html.

The Fund’s returns are reduced by expenses while the market indices are not. The ending values above illustrate the performance of a hypothetical $10,000 investment made in the Fund over the timeframes listed. Assumes reinvestment of dividends and capital gains. Returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. These figures do not imply any future performance.

The Fund’s fiscal year ended March 31, 2020 was characterized by a strong first three quarters followed by weakness when the coronavirus hit in the first quarter of 2020. Large technology stocks such as Microsoft, Amazon, Netflix and Facebook outpaced stocks in the Financial, Industrial and Energy sectors.

During the period, the best performing stocks in the Fund included Apple, Microsoft, Total System Services, and Eli Lilly. The worst performing stocks included ViacomCBS, Enterprise Product Partners, Ulta Beauty and Fortive. The Fund was slightly overweight relative to the S&P 500 Index in the Information Technology, Health Care, Consumer Discretionary and Industrial sectors during the period and was underweight in the Financials, Consumer Staples, Communication Services and Energy sectors.

As of March 31, 2020, the Fund consisted of approximately 7% cash, 26% Information Technology, 20% Health Care, 13% Consumer Discretionary, 10% Financials, 8% Industrials, 6% Communication Services, 5% Consumer Staples, 2% Materials, 2% Real Estate and 1% Energy.

We are in unprecedented times as the world deals with coronavirus and the economic impact it will have on the world. The market has delineated the stock market into those “stay-at-home” companies and all others. The “stay-at-home” stocks now are highly valued as the others have fairly low valuations in our opinion. The uncertainty on companies’ financials will be with us until we see some kind of conclusion to the current pandemic. As we follow our portfolio companies, we are focused on the businesses who will survive and thrive when this virus is defeated. This is the most unique environment I have seen since managing money for over 30 years. We continue to work diligently to provide our shareholders with the best possible returns in this difficult time.

Thank you for your continued support.

Mutual fund investing involves risk. Principal loss is possible. Investing in small- and medium-sized companies involves greater risks than those associated with investing in large company stocks, such as business risk, stock price fluctuations and liquidity.

Opinions expressed are subject to change at any time, are not guaranteed and should not be considered investment advice.

Please refer to the Schedule of Investments in the report for complete Fund holdings information. Fund holdings and sector allocations are subject to change and should not be considered a recommendation to buy or sell any security.

The S&P 500 Index is a broad-based unmanaged index of 500 stocks, which is widely recognized as representative of the equity market in general. The Russell 1000^®Growth Index measures the performance of the large-cap growth segment of the U.S. equity universe. It includes those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values. The Consumer Price Index represents changes in prices of all goods and services purchased for consumption by urban households. One cannot invest directly in an index.

Must be preceded or accompanied by a prospectus.

The Nicholas Funds are distributed by Quasar Distributors, LLC.

COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN NICHOLAS FUND, INC. AND S&P 500 INDEX

The line graph which follows compares the initial account value and subsequent account value at the end of each of the most recently completed ten fiscal years of the Fund, to the same investment over the same periods in the S&P 500 Index. The graph assumes a $10,000 investment in the Fund and the index at the beginning of the period.

The Fund’s average annual total returns for the one-, five- and ten-year periods ended on the last day of the most recent fiscal year are as follows:


	One Year Ended	Five Years Ended	Ten Years Ended
	March 31, 2020	March 31, 2020	March 31, 2020
Average Annual Total Return	-5.90%	3.29%	10.59%

Past performance is not predictive of future performance, and the above graph and table do not reflect deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.

– 3–

Financial Highlights (NICSX)
For a share outstanding throughout each period


					Years Ended March 31,
		2020			2019			2018			2017			2016
NET ASSET VALUE, BEGINNING OF PERIOD	$	65.11		$	62.10		$	65.52		$	61.78		$	71.57
INCOME (LOSS) FROM
INVESTMENT OPERATIONS
Net investment income		.33	⁽¹⁾		.38	⁽¹⁾		.29	⁽¹⁾		.37	⁽¹⁾		.44
Net gain (loss) on securities (realized
and unrealized)		(3.33	)		7.14			5.90			5.59			(6.35	)
Total from investment operations		(3.00	)		7.52			6.19			5.96			(5.91	)
LESS DISTRIBUTIONS
From net investment income		(.34	)		(.39	)		(.41	)		(.44	)		(.39	)
From net capital gain		(5.24	)		(4.12	)		(9.20	)		(1.78	)		(3.49	)
Total distributions		(5.58	)		(4.51	)		(9.61	)		(2.22	)		(3.88	)
NET ASSET VALUE, END OF PERIOD	$	56.53		$	65.11		$	62.10		$	65.52		$	61.78

TOTAL RETURN		(5.90	)%		13.07	%		10.11	%		9.87	%		(8.68	)%

SUPPLEMENTAL DATA:
Net assets, end of period (millions)	$	2,370.2		$	2,737.5		$	2,695.8		$	2,850.4		$	3,274.3
Ratio of expenses to average net assets		.72	%		.72	%		.72	%		.72	%		.72	%
Ratio of net investment income
to average net assets		.49	%		.60	%		.46	%		.58	%		.65	%
Portfolio turnover rate		15.36	%		12.76	%		18.40	%		40.90	%		28.84	%

(1) Computed based on average shares outstanding.

The accompanying notes to financial statements are an integral part of these highlights.

– 4–

Top Ten Equity Portfolio Holdings
March 31, 2020 (unaudited)


	Percentage
Name	of Net Assets
Microsoft Corporation	5.29	%
Apple Inc.	3.74	%
Alphabet Inc. – Class C	3.48	%
Aon plc	2.89	%
Thermo Fisher Scientific Inc.	2.85	%
Visa Inc. – Class A	2.82	%
Amazon.com, Inc.	2.63	%
Ball Corporation	2.16	%
Home Depot, Inc. (The)	2.13	%
Cisco Systems, Inc.	1.91	%
Total of top ten	29.90	%

Sector Diversification(as a percentage of portfolio)
March 31, 2020 (unaudited)

– 5–

Fund Expenses
For the six month period ended March 31, 2020 (unaudited)

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs and (2) ongoing costs, including management fees and other operating expenses. The following table is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with those of other mutual funds.

The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period.

The first line of the table below provides information about the 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 $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. 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 the Fund with other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of 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, such as wire fees. 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 these transactional costs were included, your costs would have been higher.


		Beginning		Ending		Expenses
		Account Value		Account Value		Paid During Period*
		09/30/19		03/31/20		10/01/19 – 03/31/20
Actual	$	1,000.00	$	881.40	$	3.39
Hypothetical		1,000.00		1,021.40		3.64
(5% return before expenses)

*	Expenses are equal to the Fund’s six-month annualized expense ratio of 0.72%, multiplied by the average account value over the period, multiplied by 183 then divided by 366 to reflect the one-half year period.

– 6–

Schedule of Investments
March 31, 2020


Shares or
Principal
Amount			Value
COMMON STOCKS — 93.39%
	Communication Services – Media & Entertainment — 5.94%
71,000	Alphabet Inc. – Class C*	$	82,559,510
650,000	Comcast Corporation – Class A		22,347,000
215,000	Facebook, Inc. – Class A*		35,862,000
			140,768,510
	Consumer Discretionary – Retailing — 10.06%
32,000	Amazon.com, Inc.*		62,391,040
270,000	Home Depot, Inc. (The)		50,411,700
867,782	LKQ Corporation*		17,798,209
144,976	O’Reilly Automotive, Inc.*		43,645,025
810,000	TJX Companies, Inc. (The)		38,726,100
145,000	Ulta Beauty, Inc.*		25,476,500
			238,448,574
	Consumer Discretionary – Services — 2.81%
180,000	McDonald’s Corporation		29,763,000
560,000	Starbucks Corporation		36,814,400
			66,577,400
	Consumer Staples – Food & Staples Retailing — 1.20%
100,000	Costco Wholesale Corporation		28,513,000
	Consumer Staples – Food, Beverage & Tobacco — 4.04%
600,000	Coca-Cola Company (The)		26,550,000
700,000	Mondelez International, Inc. – Class A		35,056,000
285,000	PepsiCo, Inc.		34,228,500
			95,834,500
	Energy — 1.03%
1,700,000	Enterprise Products Partners L.P.		24,310,000
	Financials – Banks — 1.01%
265,000	JPMorgan Chase & Co.		23,857,950
	Financials – Diversified — 4.38%
1,000,000	Charles Schwab Corporation (The)		33,620,000
385,000	Intercontinental Exchange, Inc.		31,088,750
160,000	S&P Global Inc.		39,208,000
			103,916,750
	Financials – Insurance — 4.21%
415,000	Aon plc		68,491,600
280,000	Chubb Limited		31,273,200
			99,764,800
	Health Care – Equipment & Services — 8.68%
605,000	Alcon, Inc.*		30,746,100

The accompanying notes to financial statements are an integral part of this schedule.

– 7–

Schedule of Investments(continued)
March 31, 2020


Shares or
Principal
Amount			Value
COMMON STOCKS — 93.39% (continued)
	Health Care – Equipment & Services — 8.68% (continued)
140,000	Becton, Dickinson and Company	$	32,167,800
955,000	Boston Scientific Corporation*		31,161,650
300,100	Laboratory Corporation of America Holdings*		37,929,639
430,000	Medtronic Public Limited Company		38,777,400
140,000	UnitedHealth Group Incorporated		34,913,200
			205,695,789
	Health Care – Pharmaceuticals,
	Biotechnology & Life Sciences — 11.29%
145,000	Amgen Inc.		29,395,850
270,000	Bristol-Myers Squibb Company		15,049,800
240,000	Eli Lilly and Company		33,292,800
400,000	Gilead Sciences, Inc.		29,904,000
280,000	Johnson & Johnson		36,716,400
425,887	Merck & Co., Inc.		32,767,746
700,000	Pfizer Inc.		22,848,000
238,188	Thermo Fisher Scientific Inc.		67,550,117
			267,524,713
	Industrials – Capital Goods — 4.98%
1,080,000	Fastenal Company		33,750,000
650,000	Fortive Corporation		35,873,500
215,000	Honeywell International Inc.		28,764,850
181,100	Snap-on Incorporated		19,707,302
			118,095,652
	Industrials – Commercial & Professional Services — 3.31%
252,500	Cintas Corporation		43,738,050
506,000	Copart, Inc.*		34,671,120
			78,409,170
	Information Technology – Hardware & Equipment — 5.64%
348,165	Apple Inc.		88,534,878
1,150,000	Cisco Systems, Inc.		45,206,500
			133,741,378
	Information Technology – Semiconductors &
	Semiconductor Equipment — 2.50%
50,000	Intel Corporation		2,706,000
340,000	Skyworks Solutions, Inc.		30,389,200
335,000	Xilinx, Inc.		26,109,900
			59,205,100
	Information Technology – Software & Services — 18.34%
100,000	Adobe Inc.*		31,824,000

The accompanying notes to financial statements are an integral part of this schedule.

– 8–

Schedule of Investments(continued)
March 31, 2020


	Shares or
	Principal
	Amount			Value
	COMMON STOCKS — 93.39% (continued)
		Information Technology – Software & Services — 18.34% (continued)
	320,000	Fiserv, Inc.*	$	30,396,800
	210,000	Gartner, Inc.*		20,909,700
	299,737	Global Payments Inc.		43,231,067
	180,000	Mastercard Incorporated – Class A		43,480,800
	795,000	Microsoft Corporation		125,379,450
	187,500	salesforce.com, inc.*		26,996,250
	85,000	ServiceNow, Inc.*		24,359,300
	415,000	Visa Inc. – Class A		66,864,800
	162,500	Workday, Inc.*		21,160,750
				434,602,917
		Materials — 2.16%
	790,802	Ball Corporation		51,133,257
		Real Estate — 1.81%
	1,140,000	CBRE Group, Inc.*		42,989,400
		TOTAL COMMON STOCKS
		(cost $1,462,542,461)		2,213,388,860
	SHORT-TERM INVESTMENTS — 6.57%
		U.S. Government Security – 1.05%
$	25,000,000	U.S. Treasury Bill 04/02/2020, 1.532%		24,998,954
		Money Market Funds – 5.52%
	47,801,370	Invesco Treasury Portfolio Short-Term Investments Trust
		(Institutional Class), 7-day net yield 0.30%		47,801,370
	82,923,077	Morgan Stanley Liquidity Funds Government Portfolio
		(Institutional Class), 7-day net yield 0.25%		82,923,077
				130,724,447
		TOTAL SHORT-TERM INVESTMENTS
		(cost $155,723,401)		155,723,401
		TOTAL INVESTMENTS
		(cost $1,618,265,862) – 99.96%		2,369,112,261
		OTHER ASSETS, NET OF LIABILITIES – 0.04%		1,054,313
		TOTAL NET ASSETS
		(basis of percentages disclosed above) – 100%	$	2,370,166,574

	* Non-income producing security.

The accompanying notes to financial statements are an integral part of this schedule.

– 9–

Statement of Assets and Liabilities
March 31, 2020


ASSETS
Investments in securities at value (cost $1,618,265,862)	$	2,369,112,261
Receivables —
Investment securities sold		4,102,659
Dividend and interest		1,460,145
Capital stock subscription		72,303
Total receivables		5,635,107
Other		63,613
Total assets		2,374,810,981

LIABILITIES
Payables —
Investment securities purchased		3,030,776
Due to adviser —
Management fee		1,328,564
Accounting and administrative fee		46,846
Total due to adviser		1,375,410
Capital stock redemption		72,374
Other payables and accrued expense		165,847
Total liabilities		4,644,407
Total net assets	$	2,370,166,574

NET ASSETS CONSIST OF
Paid in capital	$	1,556,290,679
Accumulated distributable earnings		813,875,895
Total net assets	$	2,370,166,574

NET ASSET VALUE PER SHARE ($.50 par value,
200,000,000 shares authorized), offering price
and redemption price (41,929,998 shares outstanding)	$	56.53

The accompanying notes to financial statements are an integral part of this statement.

– 10 –

Statement of Operations
For the year ended March 31, 2020


INCOME
Dividend	$	32,158,719
Interest		2,089,754
Total income		34,248,473

EXPENSES
Management fee		18,497,648
Transfer agent fees		712,734
Accounting and administrative fees		625,715
Custodian fees		144,896
Postage and mailing		98,739
Insurance		86,797
Printing		66,285
Registration fees		55,682
Directors’ fees		45,450
Audit and tax fees		34,084
Accounting system and pricing service fees		27,634
Legal fees		13,303
Other operating expenses		11,685
Total expenses		20,420,652
Net investment income		13,827,821

NET REALIZED GAIN ON INVESTMENTS		198,960,826

CHANGE IN NET UNREALIZED APPRECIATION/DEPRECIATION
ON INVESTMENTS		(345,645,076	)
Net realized and unrealized loss on investments		(146,684,250	)
Net decrease in net assets resulting from operations	$	(132,856,429	)

The accompanying notes to financial statements are an integral part of this statement.

– 11 –

Statements of Changes in Net Assets
For the years ended March 31, 2020 and 2019


		2020			2019
INCREASE (DECREASE) IN
NET ASSETS FROM OPERATIONS
Net investment income	$	13,827,821		$	16,315,780
Net realized gain on investments		198,960,826			187,861,377
Change in net unrealized
appreciation/depreciation on investments		(345,645,076	)		124,702,526
Net increase (decrease) in net assets
resulting from operations		(132,856,429	)		328,879,683

DISTRIBUTIONS TO SHAREHOLDERS
From investment operations		(229,604,341	)		(187,798,818	)

CAPITAL SHARE TRANSACTIONS
Proceeds from shares issued
(703,625 and 541,313 shares, respectively)		47,317,478			34,089,115
Reinvestment of distributions
(3,156,804 and 2,993,248 shares, respectively)		213,914,597			175,231,918
Cost of shares redeemed
(3,972,871 and 4,901,465 shares, respectively)		(266,150,425	)		(308,676,826	)
Change in net assets derived
from capital share transactions		(4,918,350	)		(99,355,793	)
Total increase (decrease) in net assets		(367,379,120	)		41,725,072

NET ASSETS
Beginning of period		2,737,545,694			2,695,820,622
End of period	$	2,370,166,574		$	2,737,545,694

The accompanying notes to financial statements are an integral part of these statements.

– 12 –

Notes to Financial Statements
March 31, 2020

(1) Summary of Significant Accounting Policies —
Nicholas Fund, Inc. (the “Fund”) is organized as a Maryland corporation and is registered
as an open-end, diversified management investment company under the Investment
Company Act of 1940, as amended. The primary objective of the Fund is long-term
growth. The following is a summary of the significant accounting policies of the Fund:

(a) Equity securities traded on a stock exchange will ordinarily be valued on the basis of
the last sale price on the date of valuation on the securities principal exchange, or if
in the absence of any sale on that day, the closing bid price. For securities
principally traded on the NASDAQ market, the Fund uses the NASDAQ Official
Closing Price. Investments in shares of open-end mutual funds, including money
market funds, are valued at their daily net asset value, which is calculated as of the
close of regular trading on the New York Stock Exchange. Debt securities, excluding
short-term investments, are valued at their current evaluated bid price as determined
by an independent pricing service, which generates evaluations on the basis of
dealer quotes for normal institutional-sized trading units, issuer analysis, bond
market activity and various other factors. Securities for which market quotations
may not be readily available are valued at their fair value as determined in good faith
by procedures adopted by the Board of Directors. Short-term investments
purchased at par are valued at cost, which approximates market value. Short-term
investments purchased at a premium or discount are stated at amortized cost, which
approximates market value. The Fund did not maintain any positions in derivative
instruments or engage in hedging activities during the year. Investment transactions
for financial statement purposes are recorded on trade date.

In accordance with Accounting Standards Codification (“ASC”) 820-10, “Fair Value
Measurements and Disclosures” (“ASC 820-10”), fair value is defined as the price
that the Fund would receive upon selling an investment in a timely transaction to an
independent buyer in the principal or most advantageous market of the investment.
ASC 820-10 established a three-tier hierarchy to maximize the use of observable
market data and minimize the use of unobservable inputs and to establish
classification of fair value measurements for disclosure purposes. Inputs refer
broadly to the assumptions that market participants would use in pricing the asset
or liability, including assumptions about risk, for example, the risk inherent in a
particular valuation technique used to measure fair value such as a pricing model
and/or the risk inherent in the inputs to the valuation technique. Inputs may be
observable or unobservable. Observable inputs are inputs that reflect the
assumptions market participants would use in pricing the asset or liability based on
market data obtained from sources independent of the reporting entity.
Unobservable inputs are inputs that reflect the reporting entity’s own assumptions
about the assumptions market participants would use in pricing the asset or liability
based on the best information available in the circumstances. The three-tier
hierarchy of inputs is summarized in the three broad levels listed below.

Level 1 – quoted prices in active markets for identical investments

Level 2 – other significant observable inputs (including quoted prices for similar
investments, interest rates, benchmark yields, bids, offers, transactions,

– 13 –

Notes to Financial Statements(continued)
March 31, 2020

spreads and other relationships observed in the markets among market
securities, underlying equity of the issuer, proprietary pricing models,
credit risk, etc.)

Level 3 – significant unobservable inputs (including the Fund’s own assumptions in
determining the fair value of investments)

The inputs or methodology used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of March 31, 2020 in valuing the
Fund’s investments carried at value:


		Investments
Valuation Inputs		in Securities
Level 1 –
Common Stocks⁽¹⁾	$	2,213,388,860
Money Market Funds		130,724,447
Level 2 –
U.S. Government Security		24,998,954
Level 3 –
None		—
Total	$	2,369,112,261
(1) See Schedule of Investments for further detail by industry.

The Fund did not hold any Level 3 investments during the year.

(b) Net realized gain (loss) on portfolio securities was computed on the basis of
specific identification.

(c) Dividend income is recorded on the ex-dividend date, and interest income is
recognized on an accrual basis. Non-cash dividends, if any, are recorded at value
on date of distribution. Generally, discounts and premiums on long-term debt
security purchases, if any, are amortized over the expected lives of the respective
securities using the effective yield method.

(d) Provision has not been made for federal income taxes or excise taxes since the
Fund has elected to be taxed as a “regulated investment company” and intends to
distribute substantially all net investment income and net realized capital gains on
sales of investments to its shareholders and otherwise comply with the provisions
of Subchapter M of the Internal Revenue Code applicable to regulated investment
companies.

(e) Dividends and distributions paid to shareholders are recorded on the ex-dividend
date. Distributions from net investment income are generally declared and paid at
least semiannually. Distributions of net realized capital gain, if any, are declared and
paid at least annually.

The amount of distributions from net investment income and net realized capital
gain are determined in accordance with federal income tax regulations, which may
differ from U.S. generally accepted accounting principles (“U.S. GAAP”) for

– 14 –

Notes to Financial Statements(continued)
March 31, 2020

financial reporting purposes. Financial reporting records are adjusted for permanent
book-to-tax differences to reflect tax character. At March 31, 2020, no
reclassifications were recorded.

The tax character of distributions paid during the years ended March 31, 2020 and
2019 was as follows:


		03/31/2020		03/31/2019
Distributions paid from:
Ordinary income	$	13,832,461	$	16,233,084
Long-term capital gain		215,771,880		171,565,734
Total distributions paid	$	229,604,341	$	187,798,818

As of March 31, 2020, investment cost for federal tax purposes was
$1,603,557,976 and the tax basis components of net assets were as follows:


Unrealized appreciation	$	801,025,818
Unrealized depreciation		(35,471,533	)
Net unrealized appreciation		765,554,285
Undistributed ordinary income		3,513,869
Accumulated undistributed
net realized capital gains		60,048,675
Other temporary differences		(15,240,934	)
Paid in capital		1,556,290,679
Net assets	$	2,370,166,574

The difference between financial statement and tax-basis investment cost is
attributable primarily to holdings in partnership interests.

The Fund had no material uncertain tax positions and has not recorded a liability for
unrecognized tax benefits as of March 31, 2020. Also, the Fund recognized no
interest and penalties related to uncertain tax benefits during the year ended
March 31, 2020. At March 31, 2020, the fiscal years 2017 through 2020 remain
open to examination in the Fund’s major tax jurisdictions.

(f) The Fund is considered an investment company under U.S. GAAP and follows the
accounting and reporting guidance applicable to investment companies in the
Financial Accounting Standards Board (“FASB”) ASC 946, “Financial Services –
Investment Companies.” U.S. GAAP guidance requires management to make
estimates and assumptions that effect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from estimates.

(g) In the normal course of business the Fund enters into contracts that contain general
indemnification clauses. The Fund’s maximum exposure under these arrangements
is unknown, as this would involve future claims against the Fund that have not yet
occurred. Based on experience, the Fund expects the risk of loss to be remote.

– 15 –

Notes to Financial Statements(continued)
March 31, 2020

(h) In connection with the preparation of the Fund’s financial statements, management
evaluated subsequent events after the date of the Statement of Assets and
Liabilities of March 31, 2020. There have been no material subsequent events since
March 31, 2020 that would require adjustment to or additional disclosure in these
financial statements.

(2) Related Parties —
(a) Investment Adviser and Management Agreement —

The Fund has an agreement with Nicholas Company, Inc. (with whom certain
officers and directors of the Fund are affiliated) (the “Adviser”) to serve as
investment adviser and manager. Under the terms of the agreement, a monthly fee
is paid to the Adviser based on an annualized fee of 0.75% of the average net asset
value up to and including $50 million and 0.65% of the average net asset value in
excess of $50 million.

The Adviser may be paid for accounting and administrative services rendered by its
personnel, subject to the following guidelines: (i) up to five basis points, on an
annual basis, of the average net asset value of the Fund up to and including $2
billion and up to three basis points, on an annual basis, of the average net asset
value of the Fund greater than $2 billion, based on the average net asset value of
the Fund as determined by valuations made at the close of each business day of
each month, and (ii) where the preceding calculation results in an annual payment
of less than $50,000, the Adviser, in its discretion, may charge the Fund up to
$50,000 for such services.

(b) Legal Counsel —

A director of the Adviser is affiliated with a law firm that provides services to the
Fund. The Fund incurred expenses of $8,087 for the year ended March 31, 2020 for
legal services rendered by this law firm.

(3) Investment Transactions —
For the year ended March 31, 2020, the cost of purchases and the proceeds from sales
of investment securities, other than short-term obligations, aggregated $411,944,134
and $592,093,175, respectively.

– 16 –

Report of Independent Registered
Public Accounting Firm

To the shareholders and Board of Directors of Nicholas Fund, Inc.

Opinion on the Financial Statements and Financial Highlights
We have audited the accompanying statement of assets and liabilities of Nicholas Fund, Inc.
(the “Fund”), including the schedule of investments, as of March 31, 2020, the related
statements of operations for the year then ended, the statements of changes in net assets for
each of the two years in the period then ended, the financial highlights for each of the five
years in the period then ended, and the related notes. In our opinion, the financial statements
and financial highlights present fairly, in all material respects, the financial position of the
Fund as of March 31, 2020, and the results of its operations for the year then ended, the
changes in its net assets for each of the two years in the period then ended, and the financial
highlights for each of the five years in the period then ended, in conformity with accounting
principles generally accepted in the United States of America.

Basis for Opinion
These financial statements and financial highlights are the responsibility of the Fund’s
management. Our responsibility is to express an opinion on the Fund’s financial statements and
financial highlights based on our audits. We are a public accounting firm registered with the
Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be
independent with respect to the Fund in accordance with the U.S. federal securities laws and the
applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material misstatement, whether due to
error or fraud. The Fund is not required to have, nor were we engaged to perform, an audit of
its internal control over financial reporting. As part of our audits we are required to obtain an
understanding of internal control over financial reporting but not for the purpose of
expressing an opinion on the effectiveness of the Fund’s internal control over financial
reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of
the financial statements and financial highlights, whether due to error or fraud, and
performing procedures that respond to those risks. Such procedures included examining, on
a test basis, evidence regarding the amounts and disclosures in the financial statements and
financial highlights. Our audits also included evaluating the accounting principles used and
significant estimates made by management, as well as evaluating the overall presentation of
the financial statements and financial highlights. Our procedures included confirmation of
securities owned as of March 31, 2020, by correspondence with the custodian and brokers.
We believe that our audits provide a reasonable basis for our opinion.

Milwaukee, Wisconsin
May 29, 2020

We have served as the auditor of one or more Nicholas investment companies since 1977.

– 17 –


Historical Record
(unaudited)

				Net
				Investment					Dollar		Growth of
		Net		Income			Capital Gain		Weighted		an Initial
		Asset Value		Distributions			Distributions		Price/Earnings		$10,000
		Per Share		Per Share			Per Share		Ratio⁽²⁾		Investment(3)
July 14, 1969⁽¹⁾	$	6.59	$	—		$	—		—	$	10,000
March 31, 1985		29.24		0.6420			1.5760		13.2 times		69,858
March 31, 1986		35.26		0.5750			0.6100		15.8		87,699
March 31, 1987		39.94		0.8820			0.1870		16.3		102,387
March 31, 1988		32.15		1.8400			4.0340		14.1		98,557
March 31, 1989		35.27		1.0250			0.4510		13.2		113,155
March 31, 1990		37.72		0.9240			1.0540		14.9		127,360
March 31, 1991		42.99		0.7900			0.2250		16.9		149,180
March 31, 1992		49.68		0.6790			0.8240		19.4		178,011
March 31, 1993		52.91		0.6790			2.0420		18.5		200,098
March 31, 1994		51.10		0.8175			1.0470		16.7		200,182
March 31, 1995		52.22		0.7070			3.3170		17.2		221,970
March 31, 1996		63.81		0.5650			4.0945		21.0		293,836
March 31, 1997		67.11		0.4179			5.3166		21.7		336,973
March 31, 1998		93.98		0.3616			5.8002		30.0		508,762
March 31, 1999		85.20		0.5880			8.2716		31.7		509,446
March 31, 2000		84.56		0.3114			5.9433		37.3		543,813
March 31, 2001		54.11		0.1900			19.2500		26.6		452,780
March 31, 2002		53.74		0.2360			—		23.8		451,627
March 31, 2003		40.37		0.1585			—		16.4		340,547
March 31, 2004		56.14		0.0905			—		19.4		474,406
March 31, 2005		60.05		0.0678			0.4100		19.4		511,476
March 31, 2006		61.49		0.2512			5.3194		18.4		574,151
March 31, 2007		57.85		0.8173			4.3310		16.6		588,783
March 31, 2008		45.03		0.2283			9.9501		17.4		550,664
March 31, 2009		27.71		0.1714			4.6096		12.1		376,093
March 31, 2010		44.00		0.0939			—		19.1		598,760
March 31, 2011		48.18		0.0297			3.7458		17.9		716,234
March 31, 2012		47.85		0.1844			3.3515		18.7		769,243
March 31, 2013		55.01		0.0144			2.6127		20.1		934,800
March 31, 2014		65.28		0.3265			2.7697		21.0		1,166,414
March 31, 2015		71.57		0.2066			5.6554		21.5		1,393,972
March 31, 2016		61.78		0.3937			3.4892		16.8		1,272,980
March 31, 2017		65.52		0.4386			1.7763		22.2		1,398,599
March 31, 2018		62.10		0.4061			9.2027		23.9		1,539,955
March 31, 2019		65.11		0.3917			4.1213		23.8		1,741,281
March 31, 2020		56.53		0.3365	(a)		5.2417	(b)	22.5		1,638,615

(1)	Date of Initial Public Offering.
(2)	Based on latest 12 months accomplished earnings.
(3)	Assuming reinvestment of all distributions.
(a)	Paid $0.0848 on June 5, 2019 to shareholders of record on June 4, 2019. Paid $0.2517 on December 27, 2019 to shareholders of record on December 26, 2019.
(b)	Paid $1.8506 on June 5, 2019 to shareholders of record on June 4, 2019. Paid $3.3911 on December 27, 2019 to shareholders of record on December 26, 2019.

– 18 –

Approval of Investment Advisory Contract
(unaudited)

A discussion of the Approval by the Board of Directors of the Fund’s Investment Advisory
Contract can be found in the Fund’s Semiannual Report dated September 30, 2019.

Liquidity Risk Management Program
(unaudited)

The Fund has adopted and implemented a liquidity risk management program (the
“Program”) in accordance with Rule 22e-4 under the 1940 Act. The Program seeks to assess
and manage the Fund’s liquidity risk, i.e., the risk that a Fund is unable to satisfy redemption
requests without significantly diluting remaining investors’ interests in the Fund. The Board of
Directors of the Fund has designated Nicholas Company, Inc., the Fund’s investment adviser,
to administer the Program. Certain aspects of the Program rely on third parties to perform
certain functions, including the provision of market data and application of models.

The Program is comprised of various components designed to support the assessment
and/or management of liquidity risk, including: (1) the periodic assessment (no less
frequently than annually) of certain factors that influence a Fund’s liquidity risk; (2) the
periodic classification (no less frequently than monthly) of a Fund’s investments into one of
four liquidity categories that reflect an estimate of their liquidity under current market
conditions; (3) a 15% limit on the acquisition of “illiquid investments” (as defined under
Rule 22e-4); (4) for a Fund that does not invest primarily in “highly liquid investments”
(as defined under Rule 22e-4), the determination of a minimum percentage of the Fund’s
assets that will generally be invested in highly liquid investments (a “Highly Liquid Investment
Minimum”); and (5) periodic reporting to the Board of Directors.

At a meeting of the Board of Trustees on February 3, 2020, Nicholas Company, Inc. provided
a written report to the Board addressing the operation, and the adequacy and effectiveness of
the implementation, of the Program, including, as applicable, the operation of any Highly
Liquid Investment Minimum and any material changes to the Program, for the initial period
from June 1, 2019 through December 31, 2019 (the “Reporting Period”). Among other things,
the annual report discussed: (1) the results of stress tests designed to assess liquidity under
a hypothetical stressed scenario involving elevated redemptions; and (2) an assessment of the
methodologies used to classify investments into one of four liquidity categories. The report
concluded that the Program was reasonably designed to assess and manage liquidity risk and
was adequately and effectively implemented during the Reporting Period.

There can be no assurance that the Program will achieve its objectives under all
circumstances in the future. Please refer to the Fund’s prospectus for more information
regarding the Fund’s exposure to liquidity risk and other risks to which it may be subject.

– 19 –

Information on Proxy Voting
(unaudited)

A description of the policies and procedures that the Fund uses to determine how to vote
proxies relating to portfolio securities is available, without charge, upon request by calling
800-544-6547 or 414-276-0535. It also appears in the Fund’s Statement of Additional
Information, which can be found on the SEC’s website, www.sec.gov. A record of how the
Fund voted its proxies for the most recent twelve-month period ended June 30, also is
available on the Fund’s website, www.nicholasfunds.com, and the SEC’s website,
www.sec.gov.

Quarterly Portfolio Schedule
(unaudited)

The Fund files its complete schedule of investments with the SEC for the first and third
quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form
N-PORT reports are available on the SEC’s website at www.sec.gov and may be reviewed and
copied at the SEC’s Public Reference Room in Washington, D.C. Information on the operation
of the Public Reference Room may be obtained by calling 800-SEC-0330.

– 20 –

Directors and Officers of the Fund
(unaudited)

The following table sets forth the pertinent information about the Fund’s directors and officers
as of March 31, 2020. Unless otherwise listed, the business address of each director and
officer is 411 East Wisconsin Avenue, Milwaukee, WI 53202.


				Number of
		Term of		Portfolios
	Positions	Office and	Principal	in Fund	Other
	Held	Length of	Occupations	Complex Directorships
	With	Time	During Past	Overseen	Held
Name and Age	Fund	Served	5 Years	by Director	by Director
INTERESTED DIRECTOR
David O. Nicholas, CFA	President,	⁽³⁾, 3 years	President, Chief	5	None
– 58⁽¹⁾⁽²⁾	Director and		Executive Officer,
	Lead		Chief Investment
	Portfolio		Officer and Director,
	Manager		Nicholas Company,
			Inc., the Adviser
			to the Fund. He is
			also the Lead
			Portfolio Manager
			of Nicholas II, Inc.
			and Nicholas Limited
			Edition, Inc. and Co-
			Portfolio Manager of
			Nicholas Equity
			Income Fund, Inc.
DISINTERESTED DIRECTORS
John A. Hauser – 61	Director	⁽³⁾, 3 years	Private Investor.	5	None
			Senior Vice
			President – Trust and
			Community Relations,
			Nicolet Bank, October
			2016 to December 2016.
			Senior Vice President –
			Director of Wealth Services,
			April 2016 to October 2016.
			Prior to its acquisition by
			Nicolet Bank in April 2016,
			Mr. Hauser served in
			various senior management
			roles for Baylake Bank
			from 1984 to 2008 and
			from 2009 to April 2016.

– 21 –

Directors and Officers of the Fund(continued)
(unaudited)


				Number of
		Term of		Portfolios
	Positions Office and		Principal	in Fund	Other
	Held	Length of	Occupations	Complex Directorships
	With	Time	During Past	Overseen	Held
Name and Age	Fund	Served	5 Years	by Director	by Director
David P. Pelisek, CFA – 61	Director	^(3),(4)	Private Investor,	5	None
			September 2016 to
			present. Managing
			Director, Robert W. Baird
			& Co., Inc. and Partner,
			Baird Capital Partners
			Buyout Funds I-V,
			January 1994 to
			May 2016.
Jay H. Robertson – 68	Director	⁽³⁾, 17 years	Private Investor,	5	None
			April 2000 to present.
			Chairman of the Board
			of Robertson-Ryan and
			Associates, Inc., an
			insurance brokerage firm
			from 1993 to March 2000.
		Term of
	Positions	Office and
	Held	Length of
	With	Time
Name and Age	Fund	Served	Principal Occupations During Past 5 Years
OFFICERS
David L. Johnson, CFA	Executive	Annual,	Executive Vice President, Nicholas Company, Inc.,
– 78⁽²⁾	Vice	40 years	the Adviser to the Fund.
	President
Lawrence J. Pavelec, CFA	Senior Vice	Annual,	Executive Vice President, Secretary and Chief
– 61	President	15 years	Operating Officer, Nicholas Company, Inc., the
	and		Adviser to the Fund, and employed by the Adviser
	Secretary		since April 2003. He has been Portfolio Manager
			for Nicholas High Income Fund, Inc. since
			April 2008.
Jennifer R. Kloehn, CPA	Senior Vice	Annual,	Executive Vice President, Treasurer, Chief
– 46	President,	4 years	Financial Officer and Chief Compliance Officer,
	Treasurer		Nicholas Company, Inc. the Adviser to the Fund.
	and Chief		Compliance Officer and Assistant Vice President
	Compliance		of the Adviser from July 2004 to April 2016.
	Officer

– 22 –

Directors and Officers of the Fund(continued)
(unaudited)


		Term of
	Positions	Office and
	Held	Length of
	With	Time
Name and Age	Fund	Served	Principal Occupations During Past 5 Years
Michael L. Shelton, CFA,	Senior	Annual,	Senior Vice President, Nicholas Company, Inc.,
CPA – 48	Vice	4 years	the Adviser to the Fund and Lead Portfolio
	President,		Manager of Nicholas Equity Income Fund, Inc.
	and		He served as Co-Portfolio Manager of Nicholas
	Co-Portfolio		Equity Income Fund, Inc. from April 2011 to
	Manager		August 2016.
Candace L. Lesak, CFP	Vice	Annual,	Employee, Nicholas Company, Inc., the Adviser to
– 62	President	34 years	the Fund.

(1)	David O. Nicholas is the only director of the Fund who is an “interested person” of the Fund, as that term is defined in the 1940 Act. Mr. Nicholas is a Director of the Adviser and owns 60% of the outstanding voting securities of the Adviser.
(2)	David O. Nicholas is a nephew of David L. Johnson.
(3)	Until duly elected or re-elected at a subsequent annual meeting of the Fund.
(4)	David P. Pelisek was elected a Director of the Fund by shareholder vote on December 20, 2019.

The Fund’s Statement of Additional Information includes additional information about the
Fund directors and is available, without charge, upon request, by calling 800-544-6547 or
414-276-0535.

– 23 –

Nicholas Fund, Inc. respects each shareholder’s right to privacy. We are committed to safeguarding the information that you provide us to maintain and execute transactions on your behalf.

We collect the following non-public personal information about you:

*	Information we receive from you on applications or other forms, whether we receive the form in writing or electronically. This includes, but is not limited to, your name, address, phone number, tax identification number, date of birth, beneficiary information and investment selection.
*	Information about your transactions with us and account history with us. This includes, but is not limited to, your account number, balances and cost basis information. This also includes transaction requests made through our transfer agent.
*	Other general information that we may obtain about you such as demographic information.

WE DO NOT SELL ANY NON-PUBLIC PERSONAL INFORMATION ABOUT CURRENT OR FORMER SHAREHOLDERS.

INFORMATION SHARED WITH OUR TRANSFER AGENT, A THIRD PARTY COMPANY, ALSO IS NOT SOLD.

We may share, only as permitted by law, non-public personal information about you with third party companies. Listed below are some examples of third parties to whom we may disclose non-public personal information. While these examples do not cover every circumstance permitted by law, we hope they help you understand how your information may be shared.

We may share non-public personal information about you:

*	With companies who work for us to service your accounts or to process transactions that you may request. This would include, but is not limited to, our transfer agent to process your transactions, mailing houses to send you required reports and correspondence regarding the Fund and its Adviser, the Nicholas Company, Inc., and our dividend disbursing agent to process fund dividend checks.
*	With a party representing you, with your consent, such as your broker or lawyer.
*	When required by law, such as in response to a subpoena or other legal process.

The Fund and its Adviser maintain policies and procedures to safeguard your non-public personal information. Access is restricted to employees who the Adviser determines need the information in order to perform their job duties. To guard your non-public personal information we maintain physical, electronic, and procedural safeguards that comply with federal standards.

In the event that you hold shares of the Fund with a financial intermediary, including, but not limited to, a broker-dealer, bank, or trust company, the privacy policy of your financial intermediary would govern how your non-public personal information would be shared with non-affiliated third parties.

– 24 –

Automatic Investment Plan — An Update
(unaudited)

The Nicholas Family of Funds’ Automatic Investment Plan provides a simple method to dollar cost average into the fund(s) of your choice.

Dollar cost averaging involves making equal systematic investments over an extended time period. A fixed dollar investment will purchase more shares when the market is low and fewer shares when the market is high. The automatic investment plan is an excellent way for you to become a disciplined investor.

The following table illustrates what dollar cost averaging can achieve. Please note that past performance is no guarantee of future results. Nicholas Company recommends dollar cost averaging as a practical investment method. It should be consistently applied for long periods so that investments are made through several market cycles.


		Nicholas Fund
$1,000 initial investment on		07/14/1969	*		03/31/2010
Number of years investing $100 each month
following the date of initial investment		50.7			10
Total cash invested	$	61,900		$	13,000
Total dividend and capital gain distributions reinvested .	$	2,376,875		$	8,712
Total full shares owned at 03/31/20		44,451			373
Total market value at 03/31/20	$	2,512,825		$	21,124

The results above assume purchase on the last day of the month. The Nicholas Automatic Investment Plan actually invests on the date specified by the investor. Total market value includes reinvestment of all distributions.

*Date of Initial Public Offering.

– 25 –

Directors and Officers

DAVID O. NICHOLAS, President and Director

JOHN A. HAUSER, Director

DAVID P. PELISEK, Director

JAY H. ROBERTSON, Director

DAVID L. JOHNSON, Executive Vice President

JENNIFER R. KLOEHN, Senior Vice President,
Treasurer and Chief Compliance Officer

LAWRENCE J. PAVELEC, Senior Vice President and Secretary

MICHAEL L. SHELTON, Senior Vice President

CANDACE L. LESAK, Vice President

Investment Adviser
NICHOLAS COMPANY, INC.
Milwaukee, Wisconsin
www.nicholasfunds.com
414-276-0535 or 800-544-6547

Transfer Agent
U.S. BANCORP FUND SERVICES, LLC
Milwaukee, Wisconsin
414-276-0535 or 800-544-6547

Distributor
QUASAR DISTRIBUTORS, LLC
Milwaukee, Wisconsin

Custodian
U.S. BANK N.A.
Milwaukee, Wisconsin

Independent Registered Public Accounting Firm
DELOITTE & TOUCHE LLP
Milwaukee, Wisconsin

Counsel
MICHAEL BEST & FRIEDRICH LLP
Milwaukee, Wisconsin

This report is submitted for the information of shareholders of the Fund. It is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus.

Item 2. Code of Ethics.

CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND

SENIOR FINANCIAL OFFICERS

I. Covered Officers/Purpose of the Code

The Nicholas Family of Funds code of ethics (this “Code”) for the investment companies withinthe complex (collectively, “Funds” and each, “Company”) applies to the Company’s Principal Executive Officer and Principal Financial Officer (the “Covered Officers” each of whom are set forth in Exhibit A)for the purpose of promoting:

honest and ethical conduct, including the ethical handling of actual or apparent conflicts ofinterest between personal and professional relationships;
full, fair, accurate, timely and understandable disclosure in reports and documents that aregistrant files with,or submits to, the Securities and Exchange Commission (“SEC”) and inother public communications made by the Company;
compliance with applicable laws and governmental rules and regulations;
the prompt internal reporting of violations of the Code to an appropriate person or personsidentified in the Code; and
accountability for adherence to the Code.

Each Covered Officer should adhere to a high standard of business ethics and should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest.

II.Covered Officers Should Handle Ethically Actual and Apparent Conflicts of Interest

Overview.A “conflict of interest” occurs when a Covered Officer’s private interest interferes withthe interests of, or his or her service to, the Company. For example, a conflict of interest would arise if a Covered Officer, or a member of his or her family, receives improper personal benefits as a result of his position with the Company.

Certain conflicts of interest arise out of the relationships between Covered Officers and the Company and already are subject to conflict of interest provisions in the Investment Company Act of 1940

(“Investment Company Act”) and the Investment Advisers Act of 1940 (“Investment Advisers Act”). Forexample, Covered Officers may not individually engage in certain transactions (such as the purchase orsale of securities or other property) with the Company because of their status as “affiliated persons” of the Company. The Company’s and the investment adviser’s compliance programs and procedures aredesigned to prevent, or identify and correct, violations of these provisions. This Code does not, and is not

intended to, repeat or replace these programs and procedures, and such conflicts fall outside of the parameters of this Code.

Although typically not presenting an opportunity for improper personal benefit, conflicts arise from, or as a result of, the contractual relationship between the Company and the investment adviser of which the Covered Officers are also officers or employees. As a result, this Code recognizes that the Covered Officers will, in the normal course of their duties (whether formally for the Company or for the adviser, or for both), be involved in establishing policies and implementing decisions that will have different effects on the adviser and the Company. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the Company and the adviser and is consistent with the performance by the Covered Officers of their duties as officers of the Company. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, it is recognized by the

Funds’ Boards of Directors (“Boards”) that the Covered Officers may also be officers or employees ofone or more other investment companies covered by this or other codes.

Other conflicts of interest are covered by the Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under the Code, but Covered Officers should keep in mind that these examples are not exhaustive. The overarching principle is that the personal interest of a Covered Officer should not be placed improperly before the interest of the Company.

* * *

Each Covered Officer must:

	not use his or her personal influence or personal relationships improperly to influence
	decisions or financial reporting by the Company whereby the Covered Officer
	benefit personally to the detriment of the Company;
	not cause the Company to take action, or fail to take action, for the individual personal benefit
	the Covered Officer rather than the benefit of the Company;
	not use material non-public knowledge of portfolio transactions made or contemplated for the
	to trade personally or cause others to trade personally in contemplation of the market
	of such transactions;
	report, at least annually:
	officer and director positions in corporations, public or private, for profit or not for profit, or in which the Covered Officer or any of his or her immediate family members holds 5% or more of its outstanding stock;

Positions as a trustee, executor or other fiduciary;
Ownership interest in any broker-dealer or bank;
Transactions between the Covered Officer and any of the Nicholas Family of Funds, theNicholas Company or any company in which any director of any of the Nicholas Familyof Funds is an officer or director.
Situations in which any immediate family member of the Covered Employee is an officer,director or employee of any company in which any officer or director of the NicholasCompany or any of the Nicholas Family of Funds is a director or executive officer.

There are some conflict of interest situations that should always be discussed with the appropriate officer if material. If the matter involves Jennifer R. Kloehn, she should discuss the matter with David O. Nicholas. If the matter involves any other person, that person should discuss the matter with Jennifer R. Kloehn. In each case, the officer with whom such matter is discussed is encouraged to review the matter with counsel to the Company. Examples of these include:

service as a director on the board of any public company;
the receipt of any non-nominal gifts;
the receipt of any entertainment from any company with which the Company has current orprospective business dealings unless such entertainment is business-related, reasonable in cost,appropriate as to time and place, and not so frequent as to raise any question of impropriety;
any ownership interest in, or any consulting or employment relationship with, any of the
Company’s service providers, other than its investment adviser, principal underwriter,administrator or any affiliated person thereof;
a direct or indirect financial interest in commissions, transaction charges or spreads paid bythe Company for effecting portfolio transactions or for selling or redeeming shares other thanan interest arising from the Covered Officer’s employment, such as compensation or equityownership.

III.	Disclosure and Compliance
		Each Covered Officer should familiarize himself or herself with the disclosure requirements generally applicable to the Company;
		each Covered Officer should not knowingly misrepresent, or cause others to misrepresent, facts about the Company to others, whether within or outside the Company, including to the
		Company’s directors and auditors, and to governmental regulators and self-regulatory organizations;

each Covered Officer should, to the extent appropriate within his or her area of responsibility,consult with other officers and employees of the Funds and the adviser with the goal ofpromoting full, fair, accurate, timely and understandable disclosure in the reports anddocuments the Funds files with, or submits to, the SEC and in other public communicationsmade by the Funds; and
it is the responsibility of each Covered Officer to promote compliance with the standards andrestrictions imposed by applicable laws, rules and regulations.

IV. Reporting and Accountability

Each Covered Officer must:

promptly after adoption of the Code or thereafter as applicable upon becoming a CoveredOfficer, affirm in writing to the Board that he or she has received, read, and understands theCode;
annually thereafter affirm to the Board that he or she has complied with the requirements ofthe Code;
not retaliate against any other Covered Officer or any employee of the Funds or their affiliatedpersons for reports of potential violations that are made in good faith; and
notify the appropriate person promptly if he or she knows of any violation of this Code. Failureto do so is itself a violation of this Code. Each Covered Officer should notify Jennifer R.
Kloehn unless the person violating the Code is Jennifer R. Kloehn, in which case such personshould notify David O. Nicholas. In each case, each Covered Officer is encouraged to alsocontact counsel to the Fund.

Jennifer R. Kloehn is responsible for applying this Code to specific situations in which questions are presented under it and has the authority to interpret this Code in any particular situation; provided that if the situation involves Jennifer R. Kloehn directly, then Mr. David O. Nicholas is responsible for applying the Code to her and he has authority to interpret the Code with respect to such application. Both Jennifer R. Kloehn and David O. Nicholas are encouraged to discuss the matter with counsel to the Fund. However, any approvals or waivers sought by the Principal Executive Officer will be considered by the independent directors.

The Company will follow these procedures in investigating and enforcing this Code:

Jennifer R. Kloehn or David O. Nicholas, with the advice of counsel will take all appropriateaction to investigate any potential violations reported to her or him;
if, after such investigation, the officer making such investigation believes that no violation hasoccurred, they are not required to take any further action;

any matter that the officer making the investigation believes is a violation will be reported tothe independent directors;
if the independent directors concur that a violation has occurred, they will consider appropriateaction, which may include review of, and appropriate modifications to, applicable policies andprocedures; notification to appropriate personnel of the investment adviser or its board; or arecommendation to dismiss the Covered Officer;
the independent directors will be responsible for granting waivers, as appropriate; and
any changes to or waivers of this Code will, to the extent required, be disclosed as provided bySEC rules.

V. Other Policies and Procedures

This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder.

Insofar as other policies or procedures of the Funds, the Funds’ adviser, principal underwriter, or otherservice providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superseded by this Code to the extent that they overlap or conflict with theprovisions of this Code. The Funds’ and their investment adviser’s codes of ethics under Rule 17j-1 underthe Investment Company Act and the adviser’s more detailed policies andprocedures are separate requirements applying to the Covered Officers and others, and are not part of this Code.

VI. Amendments

Any amendments to this Code, other than amendments to Exhibit A, must be approved or ratified by a majority vote of the Board, including a majority of independent directors.

VII. Confidentiality

All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the appropriate Board and its counsel, the appropriate Company and the Nicholas Company.

VIII. Internal Use

The Code is intended solely for the internal use by the Funds and does not constitute an admission, by or on behalf of any Company, as to any fact, circumstance, or legal conclusion.

The undersigned, the duly elected secretary of the funds (the "Funds"), does hereby certify that the foregoing Code of Ethics (the "Code") is in the form adopted by the Board of Directors of each such Fund at which such person is the secretary, at a meeting duly called and convened on October 28, 2016, at which meeting all of the members of the Board of Directors, including all of the directors who are not "interested persons" of each such Fund, as such term is defined under the Investment Company Act of 1940, voted in favor of adoption of such Code presented at that meeting, and that the Code, in such form, as amended, has been adopted or will be ratified by all of the directors of each such Fund, including all of the directors of each such Fund who are not "interested persons" of the Fund.

Dated: November 22, 2016

Affirmed: November 22, 2019

/s/ Lawrence J. Pavelec
Lawrence J. Pavelec, Secretary
Nicholas Fund, Inc.
Nicholas II, Inc.
Nicholas High Income Fund, Inc.
Nicholas Equity Income Fund, Inc.
Nicholas Limited Edition, Inc.
Nicholas Money Market Fund, Inc.

Exhibit A


Persons Covered by this Code of Ethics
The Nicholas Company	David O. Nicholas	Jennifer R. Kloehn
Nicholas Fund, Inc.	David O. Nicholas	Jennifer R. Kloehn
Nicholas II, Inc.	David O. Nicholas	Jennifer R. Kloehn
Nicholas Limited Edition, Inc.	David O. Nicholas	Jennifer R. Kloehn
Nicholas High Income Fund, Inc.	David O. Nicholas	Jennifer R. Kloehn
Nicholas Equity Income Fund, Inc.	David O. Nicholas	Jennifer R. Kloehn

Item 3. Audit Committee Financial Expert.

The Fund's Board of Directors has determined that Mr. David P. Pelisek, an independent director, qualifies as an audit committee financial expert as that term is defined for purposes of this item. He wasselected as the Fund’s Audit Committee Financial Expert at the Fund’s Board of Directors Meeting heldon February 3, 2020.

Item 4. Principal Accountant Fees and Services.

(a)Audit Fees. The aggregate fees billed for each of the last two fiscal years (the "Reporting Periods") for professional services rendered by the Fund's principal accountant (the "Auditor") for the audit of the Fund's annual financial statements, or services that are normally provided by the Auditor in connection with the statutory and regulatory filings or engagements for the Reporting Periods, were $26,600 in 2020 and $25,900 in 2019.

(b)Audit-Related Fees. There were no fees billed in each of the last two fiscal years for assurance and related services rendered by the Auditor to the Fund that are reasonably related to the performance of the audit of the Fund's financial statements and are not reported under paragraph (a) of this Item 4.

(c)Tax Fees. The aggregate fees billed in the Reporting Periods for professional services rendered by the Auditor for tax compliance, tax advice and tax planning ("Tax Services") were $6,450 in 2020 and $6,225 in 2019. These services consisted of (i) review or preparation of U.S. federal, state, local and excise tax returns; (ii) U.S. federal, state and local tax planning, advice and assistance regarding statutory, regulatory or administrative developments, (iii) tax advice regarding tax qualification matters and/or treatment of various financial instruments held or proposed to be acquired or held.

(d)All Other Fees. The aggregate fees billed for professional services rendered by the Auditor to the Fund's investment adviser were approximately $18,200 in 2019 and $18,200 in 2018. These services were for the audit of the investment adviser for the adviser's fiscal year ended 10/31/2019 and 10/31/2018, respectively.

(e) (1)Audit Committee Pre-Approval Policies and Procedures. The Fund's Board of Director's has not adopted any pre-approval policies and procedures as described in paragraph (c)(7) of Rule 2-01 of Regulation S-X. The Fund's Board of Directors meets with the Auditors and management to review and authorize the Auditor's engagements for audit and non-audit services to the Fund and its Adviser prior to each engagement.

(e) (2) The percentage of services described in each of paragraphs (b) through (d) of this Item that were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X are as follows:

(b)	N/A
(c)	N/A
(d)	N/A

(f)	No disclosures are required by this Item 4(f).
(g)	There were no non-audit fees billed in each of the last two fiscal years by the Auditor for services

rendered to the Fund or the Fund's investment adviser that provides ongoing services.

(h) No disclosures are required by this Item 4(h).

Item 5. Audit Committee of Listed Registrants.
Not applicable to this filing.

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 Management Investment Companies.

Applicable only to annual reports filed by closed-end funds.

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Applicable only to annual reports filed by closed-end funds.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Companies and Affiliated Purchasers.

Applicable only to closed-end funds.

Item 10. Submission of Matters to a Vote of Security Holders.

Not applicable to this filing.

Item 11. Controls and Procedures.

(a) The Fund’s principal executive officer and principal financial officer have concluded that the Fund's disclosure controls and procedures are sufficient to ensure that information required to be disclosed by the Fund in this Form N-CSR was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, based upon such officers' evaluation of these controls and procedures as of a date within 90 days of the filing date of the report.

(b) There were no significant changes or corrective actions with regard to significant deficiencies or material weaknesses in the Fund's internal controls or in other factors that could significantly affect the Fund's internal controls subsequent to the date of their evaluation.

Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.

Applicable only to closed-end funds.

Item 13. Exhibits.

(a)(1) Code of Ethics -- Any code of ethics, or amendments thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy the Item 2 requirements through filing of an exhibit.

Not applicable to this filing.

(a)(2) Certifications of Principal Executive Officer and Principal Financial Officer pursuant to Rule 30a-2(a) under the Investment Company Act of 1940, attached hereto as part of EX-99.CERT.

(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under the Act sent or given during the period covered by the report by or on behalf of the registrant to 10 or more person.

Applicable only to closed-end funds.

(a)(4) Change in the registrant’s independent public accountant.

Not applicable to this filing.

(b) Certifications of Principal Executive Officer and Principal Financial Officer pursuant to Rule 30a-2(b) under the Investment Company Act of 1940, attached hereto as part of EX-99.906CERT.

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)Nicholas Fund, Inc.

By:/s/ David O. Nicholas
Name: David O. Nicholas
Title: Principal Executive Officer

Date:May 29, 2020

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

By:/s/ David O. Nicholas
Name: David O. Nicholas
Title: Principal Executive Officer
Date:May 29, 2020

By:/s/ Jennifer R. Kloehn
Name: Jennifer R. Kloehn
Title: Principal Financial Officer
Date:May 29, 2020

Nicholas Fund (NICSX) N-CSRCertified annual shareholder report (management investment company)