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staying the course over 21y, who does that ?

In retrospective mood tonight, I plotted the $10k-growth of several funds I used to be seriously interested in and most of which I owned off and on since Labor Day 2000. (Many of them before then, too, since the 1980s, when my career turned toward high tech.) It seemed a v tough time, fall 2000, hangover from the latest highflying tech phase. SPECX, FAIRX, more-sensible things like TWEIX and JENSX and PRBLX. VOO of course. FCNTX.

Anyway, I compared them all w old stalwart FLPSX, one man, one machine since seemingly forever (and Tillinghast is only mid-60s!). It was of him David Snowball famously wrote (maybe it was in email to me) something like 'I have never sold FLPSX and not regretted it.'

Of course these funds are not properly comparable. Still.

Check it out. Stay the course. Don't trade longterm winners even in slumps.



  • There's no question that in its early days when FLPSX was a small cap fund, it was virtually peerless. But that changed after it drifted into mid-cap territory. Performance was readily exceeded by several of the funds you list here. Perhaps you would have been better off changing horses in midstream.

    The reclassification dates to about 10/31/2005. I derive that date from the M* analyst report of 1/31/2006:
    Since 2000, the fund's stakes in mid-caps and large caps has shot up significantly, while its allocation to small and micro-caps has dropped sharply. We therefore recently moved the fund into our mid-blend category from our small-blend category to better reflect the fund's true composition.
    That report discusses the portfolio report of 10/31/2005, so that's a reasonable date to use.

    From that date through yesterday, the cumulative returns are:
    SPECX: 837.91%
    FCNTX: 572.63%
    PRBLX: 552.48%
    JENSX: 447.40%
    VOO: 408.88%
    FLPSX: 254.22%
    FAIRX: 197.66%
  • Great stuff hindsight is, innit, especially when one knows about streams and horses. The significant foreign slug has always had an effect. The impulse behind my retrospect was the updated M* highest rankings of both fund and manager --- since covid began, looks like. (Yet it's not even an MCV leader.)
    Not having been in FLPSX for some years, I was simply interested to see they were back in the site's news. Continuous MFO Great Owl all those years as well.
  • edited August 2021
    I've had one taxfree OEF reinvesting on itself since the 1980s when I was a teenager. I've got several AF's that I've held nonstop since mid-2006. I've got some stocks that I've held since 1996 ... and one stock position that's inherited that was originally purchased in the 1950s.

    I like boring investments. ;)
  • Over the years much has changed for us. We switched to use mostly index funds and ETFs, except for smaller caps and overseas. Our 401(k) choices are all index funds and target dated funds. Our expected return is modest. Getting market-like return is more than suffice.
  • Back in the 70s we started with a number of American Funds, and kept with them for well over 21 years. Sure, did some buying, selling, and trading among various American Funds, but still stayed the course with the family. In fact, still have a very small position in a couple of their funds to this very minute.

    Sure, theoretically could have done much better by changing horses as we crossed various streams, but for a guy who never was very brilliant at investing we managed to accomplish what we needed to, and are now financially living very happily.

    Different strokes, and all that...
  • edited August 2021
    tnx, OJ, that was my point, sort of. Have winner faith, hang in.

    Obvious, if not to some.

    Let us propose that in the late 1980s or early 1990s we were persuaded, from press or elsewhere, that this guy Tillinghast was worth giving some money too.

    30 years later --- which is not all that long for those of us older investors --- guess how his work compares w other wise touts of that time: DODGX, VFIAX, PENNX (old sc), DFCIX (old mc) ?

    Oops --- his returns are more than 40% higher than the best of them. Whoa. Well over double SP500, no less.

    One manager, one method, one fund. Snowball's insight is true!

    Ah, there is a same-house fund that has matched or beaten Tillinghast: FCNTX. With several managers. So you could even argue, sometimes and with hindsight, for having constant faith in a house and its LCG sector aggressively implemented.

    (If we had stuck with those two, instead of fretting and tracking and reading and trading, well, we could be giving a lot more to charity and kids these days!)
  • edited August 2021
    @davidmoran- Yes, same-house funds can be advantageous under certain circumstances. American, for example, has no "star" managers. All of the funds are run by various committees, with some degree of cross-fertilization. Will never grab any headlines for "fund of the moment" or "manager for today", but slow and steady also has it's good points.

    Again, no one approach is right for everyone. If it works for you, then do it.
  • msf
    edited August 2021
    Let us propose that in the late 1980s or early 1990s we were persuaded, from press or elsewhere, that this guy Tillinghast was worth giving some money too.

    Using performance since inception, an objective time frame, is a definite improvement over using a subjectively chosen date in the middle of 2000.

    In a similar vein, my "horse changing" date was also objective. When a fund is reclassified, especially if due to increased girth, it's a time for owners to examine what they own. Tillinghast had increased the fund's holdings to over 1,000 securities; he had exhausted this tactic.

    Ah, there is a same-house fund that has matched or beaten Tillinghast: FCNTX.

    If we're playing this what if, hypothetical game, what would have persuaded you to invest in FLPSX at inception, in a fund and in a manager with no track record? We can hypothesize anything, but it would help if it were believable. Likewise, what would have persuaded you to have invested in FCNTX?

    At least that fund had a track record, albeit with three managers over its five year life span (as of 1989). That included its then current manager who had just taken over at the beginning of 1989, and who, like Tillinghast had no prior fund management experience.

    To add insult to injury, both those funds sported a 3% load at the time.

    In Dec 1989 (when FLPSX started), if one were perusing the press, one could not have helped but be impressed by Lynch's fund. Alas, FMAGX was closed. But there was another LCG fund aggressively implemented lookin' good.

    FDGRX had a manager with ten years experience, the last two managing this fund. And from its inception in Jan 1983 through Dec 1989, it was blowing away FCNTX, 219% to 157% cumulative returns.

    None of this is to say that these are not all fine funds. But in the late 80s/early 90s, Fidelity was rotating managers like crazy. There was no expectation that any manager would be around for a long time. Just look at FCNTX, with its three managers in five years before it settled on Danoff. Magellan was the exception.
  • Gosh, if only there were some explanation. Perhaps it is all luck? Ya think?

    Hard to see a nonreactionary point here.

    >> he had exhausted this tactic

    ? Has he not largely adhered to the fund name? (I do know that the share-price criterion rose.)

    Yes, GroCo and Blue Chip too have had real sprint stints. Maybe DivGro also, I forget.
    I don't know how one chooses. I did not invest in any load funds back then (or ever).

    My initial sentiment was only about sticking with solid method over time.

    @OJ, yes, nonstar team approach (D&C also) can be another good way.
  • My initial sentiment was only about sticking with solid method over time.

    Your initial post showed how wonderful FLPSX was compared with other funds you considered as alternative investments at the time of a market peak (give or take). The fund navigated that one bear market (2000-2002) exceedingly well, even gaining in value. In all other bear markets during the fund's lifetime, it roughly paced the market:

    July 16, 1990 - Oct 16, 1990: -17.46% vs. -19.9% for S&P 500
    March 24, 2000 - Oct 9, 2002: +18.05% vs. -49.1%
    Oct 9, 2007 - March 9, 2009: -53.64% vs. -56.8%
    Feb 19, 2020 - March 23, 2020: -36.85% vs -35%

    That one fluke does suggest that "Perhaps it is all luck" after all. Its "solid method" of investing didn't help it reproduce that success in other bear markets. Take away that one fluke and I think you'll find FLPSX 's performance is right in line with that of some good funds and below that of some others.

    If the intent of the initial post was to show that funds with "solid methods" perform well, what was the purpose of including FAIRX? It hardly seems like a fund with a "solid method" of investing, at least not in recent years.

    Rather than illustrate your thesis, FAIRX seems to act as a counterexample - that funds with lousy methods of investing can do as well as funds with solid methods.

    Has he not largely adhered to the fund name?

    FLPSX was a small cap fund for about half its lifetime. It managed to remain focused on small caps through the early 2000s even as AUM exploded. It used the tactic of buying more and more different small caps to spread out the money. This tactic ran out of steam when it hit 1,000 different companies.

    As I recall, Fidelity explained that the fund was investing in a significant number of mid and large cap companies not because it had grown too large, but because it was remaining true to its "solid method". It claimed that its investing discipline naturally led to invest in larger cap stocks due to market conditions at the time. Ultimately Fidelity had to drop this charade and acknowledge that the fund had morphed into a mid cap fund.

    With respect to adhering to its name, "Tillinghast concedes that Low-Priced, which purchases only stocks that sell for $35 a share or less, is 'a bit of a gimmick.'"
  • I don't know how one chooses.

    Isn't that really the point? That one doesn't know, except in hindsight, whether one's manager will be there tomorrow, whether a fund's method is "solid" or will change, or even if it doesn't change whether it will continue to be successful over time or in the next bear market or whatever.

    Sticking with an investment should involve continual evaluation. Is this a fund I would buy today? If not, then why am I holding it?

    Out of curiosity, I ran a screen for funds that currently have a manager who has been there for at least two decades. Aside from five oddball funds without star ratings, the remaining 144 distinct funds break down as:

    5 star: 10 funds, 7%
    4 star: 30 funds, 21%
    3 star: 50 funds, 35%
    2 star: 34 funds, 24%
    1 star: 20 funds, 14%

    The M* "neutral" distribution is 10%/22.5%/35%/22.5%/10%. This is about as close to that as one would expect to get when pulling 144 funds out of a hat. Longevity would appear to count for nothing. Perhaps even less than nothing, given survival bias (funds that stay around for decades tend to be better performing ones, so these should have skewed toward more stars).

    There are several funds in the list that I recognize. A couple are:

    LLPFX, "One of the best mutual funds in history" - Jaffe, 2/6/2000. This fund, along with its sibling LLSCX have had the same managers for over three decades. Both are currently rated 1 star.

    TEFQX (Firsthand e-Commerce Fund until May 2010): "[M*'s] top rated 5 star funds were all technology and telecom funds that met investors fancy 2 1/2 years ago [mid 1997]. This led to their subscribers pouring money into the Janus and Firsthand Funds". TEFQX not only survived, but is currently rated 4*.

    However, Kevin Landis' Firsthand funds generally imploded. His flagship Technology Value Fund (TVFQX) was converted into a business development company, technically not even a registered investment company. That happened not as a result of the dot com bust, but as a result of the GFC years later.

    This is all a long winded way of saying that I agree, one can't know how to choose. As a corollary, one can't know whether to stay the course.

    Regarding Fidelity's management turnover (i.e. expectation that a new fund manager would still at the fund a few years later), late 80s/early 90s:
    This is typical: A look through Fidelity's long list of equity funds finds only about six managers who have been managing the same fund for five years or more. A tenure of one to three years for one fund is much more common, though most managers have been with Fidelity longer than that, graduating from one fund to another.
    June 15, 1992
  • edited August 2021
    Does anyone suppose that manager longevity not only relates to their performance success but also to their access to businesses and company managers they've built up over the years? I tend to think that the likes of Danoff, Tillinghast, Miller, etc., etc. might have quicker or easier access to their time and insight.

    I forgot to add that I had owned Fidelitys Contrafund FCNTX since roughly 1982. I was generally always pleased with its performance and saw little reason to change until it became quite massive in AUM and returns seemed to track that of the S&P500 +/- a percent or two here and there. Two years ago I sold a good chunk and invested the proceeds into BIAWX. Since then BIAWX has returned 83.82% to 47.61% for FCNTX. It has been a reasonable exchange so far.
  • While they may have better access, since 2000 any information provided to them must also be made public.

    SEC Regulation FD (fair disclosure)
    The timing of the required public disclosure depends on whether the selective disclosure was intentional or non-intentional; for an intentional selective disclosure, the issuer must make public disclosure simultaneously; for a non-intentional disclosure, the issuer must make public disclosure promptly.

    I suspect that in actuality the managers with access still gain some advantage, though not as much as in the 20th century. Context, or insight as you put it, matters. The fund managers could be asking pointed questions where the way the response is phrased conveys information that goes beyond the disclosure itself.
  • Yes @msf, I wasn't suggesting anything nefarious or against regulations. I just think that certain fund managers might get a 5-10 minute chat or a meet up that lesser known or renowned fund managers might not AND as you noted "where the way the response is phrased conveys information that goes beyond the disclosure itself" can speak volumes. Good point and thank you.
  • Yes, tone of voice can often convey a lot of information beyond the actual words themselves. Those of us who are married are well aware of the experience.:)
  • Or total silence accompanied by the 'look'. That can be really loud though.
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