I don’t even know what to say. Wouldn’t a story about AlphaClone be much more interesting? Like, say, how following Greenlight beats the market by 13% a year? Active mutual funds are an enormous fail for the investor.
My favorite stat:
CGMFX 10 yr annualized 19.59% returns. 10 yr annualized INVESTOR returns -13.94%!!! (Note: This is Heebner’s fund, not Miller’s, and reflects investors chasing performance buying high and selling low.)
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Off to take Momma to this!
Wow. Amazing that the investor return can be so radically different than the vanilla total return. It's not completely fair to fault Miller for the fact that his investors chose to buy high and sell low. The difference in the two statistics is due to the fact that on average the net assets of the fund were smaller during the good years and larger during the bad years. Hmm … maybe the lesson here is to stay away from large funds.
I thought the same thing… down 72% in 18 months, then up 37% totals what?
Yep, still down about 62%… gulp.
I don't understand how they computed that. I find the total fund return 2004-2008 as 50% according to the data they supply and the investor return as 17%, yet they claim the 5 year annualized return is -15%?
That stat is actually for Heebner's fund…
Ouch! Kick a guy when he's down!
I've used Ken Heebner all the way back to when he was running a fund called New England Zenith, over twenty years ago. This was part of or just before Loomis-Sayles.
My biggest regret is not rebalancing enough during those big gaining years, and realising we really were in a recession, although our government leaders never mentioned the “R” word.
So it goes.
The CGMFX performance stats are truly eye popping. I am not sure how they really gather them. Are people really that bad about buying high and selling low?
Yes… just look at the DALBAR studies.
Hi Meb. It's one of my theories on low volume for this rally. The retail investor sold out at the lows and can not bring itself to participate. I don't think they are coming in any time. This is just pros trading now.
Hi Meb. It's one of my theories on low volume for this rally. The retail investor sold out at the lows and can not bring itself to participate. I don't think they are coming in any time. This is just pros trading now.