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More troubling to me is paying 1% fees for a manager to put 25% of assets in Google, Berkshire Hathaway and Mastercard. There are thousands of stocks in the world and yet I often see these concentrated managers put significant assets in the most obvious ones. I can understand the high quality stock argument, but surely there are smaller lesser known high quality companies with maybe better growth projections than these behemoths to merit investors paying high fees for active management. I think if I were an institutional investor sitting across the table from these managers I would feel like asking, "I'm paying you 20 times the fee of an index fund and the best you could come up with to invest in is Google?" And while Google might continue to be an excellent investment, why pay 1% for a manager to buy it? Go to your broker and click buy on Google. Done. That trade by the way now costs you nothing in commissions at most brokers.
I for one agree Lewis but I feel we're in a small minority at least on this discussion board. My portfolio is structured as you allude to when it comes to those high quality stocks that everyone owns. I compliment that with POAGX and BIAWX. If I had more available funds I would consider leaving those two as well but honestly they've been worth the fees I've been charged. And they're smarter than I.
I like @LewisBraham's point. AKREX, for example opened for business in 2009 and has always had among its top ten holdings American Tower and Markel, not exactly household names, but great stocks to own. Chuck Akre has earned his ER many times over by picking winners. Granted the fund also has Visa and Mastercard in its top ten, but in general "the usual suspects" are not among its holdings.
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See this link(also posted in CG distributions):
https://www.sequoiafund.com/Communications
LONG-TERM CAP GAIN
$6.2748
SHORT-TERM CAP GAIN
$0.328
DIVIDEND (ORDINARY)
$1.1628
Whenever of my funds has a large drop compared to comparable funds, I check to see if it’s had a distribution— which is the case 99.9% of the time.
I too own stocks as well as mutual funds. Each has its own place in my portfolio.