Bill Miller Still In The Basement Over Trailing Twelve Months
Bill Miller's shareholder letter a year ago was full of excuses...Bill rode a momentum market in the late 90's but was blaming the go-go players for chasing the hot stocks, and expected he would prosper once the worm turned:
For investors who are trend followers, or theme driven, or who primarily build portfolios around forecasts, or who employ momentum strategies, price is dispositive. When they do badly, it is because prices moved in a direction different from what they thought. For value investors, price is one thing, and value is another. When prices move against us, it usually means that the gap between price and value is growing, and our future expected rates of return are higher. Bill Miller's Q1 Shareholder Letter, April 2008
Bill's spin was that he was likely to enjoy a burst of outperformance after a dreadful stretch that was legendary in the annals of long-only train wrecks...alas it is one year later and his numbers are still dreadful. Alas, he was down roughly 5.36% today and is down mid-40%'s, and solidly bottom decile against his peers since the letter was written.
But he has had a good month....and decent quarter. Is he back?
Miller is outperforming 68 percent of his peers with a 1.2 percent gain in 2009 after boosting his stake in Hopkinton, Massachusetts-based EMC Corp. in the fourth quarter. Shares of the world’s biggest maker of storage computers have added 22 percent in 2009.
Lange’s holdings of Corning Inc. contributed to Magellan’s 14 percent jump in March. Corning, New York-based Corning, the largest producer of glass for flat-panel televisions, is up 60 percent this year after saying in March that volumes will exceed its previous estimate. Bloomberg
Miller’s stake in financial’s has been obliterated, but he remains overweight last we knew. And perhaps he has rotated in technology, but before he should probably keep his head down and string together another quarter or two before taking a victory lap.
Legg Mason’s PR flacks ain’t talkin’ but his letter should be out within a week - perhaps the time to fade Bill has passed. But I have never seen an equity portfolio manager keep a job with the track record Bill has posted....working on Wall Street once was a privilege, not a right of birth.
Lets hope he has a few good jokes in the letter. We could all use a laughs, besides the occassional guffaw when we had checking Bill’s numbers at the end of the trading day.
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And are the market neutral hedgies really getting killed? Not all of them, although they are trailing many of the other strategies.
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Bill Miller Not Dead Yet as Value Funds Bury Quants
Bloomberg
Bill Miller’s Outperformance “Deferred”
1440 Wall Street
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