Only about 1 in 5 managers surpassed index returns in 2016.
Bill Miller’s opportunity Trust fund this year is up nearly 14 percent, about double the S&P 500 putting it in the top 1 percentile in its category.
Miller served as the chairman and chief investment officer of Legg Mason Capital Management as well as the principal portfolio manager of the Legg Mason Capital Management Value Trust.
Bill Miller earned an economics degree from Washington and Lee University where he graduated with honors in 1972. Subsequent, Miller served as a military intelligence officer overseas.
He also earned a Ph.D. in philosophy from the Johns Hopkins University.
In 1981 Bill Miller joined Legg Mason Capital Management as a security analyst and in 2007, he was appointed the chairman of the firm as well as its chief investment officer.
But Miller’s investment career also had its ebbs and flows. In a February 2016 interview with CNBC, he disclosed that his fund, LMM, lost 20% blaming depressed oil prices and a slowdown in China’s economy.
He expressed confusion over the change of market stating, “lower oil prices are unequivocally good for the U.S.”
Bill Miller is best known for beating the market for 15 straight years while at Legg Mason
Bill Miller is considered a value investor who believes that “any stock can be a value stock if it trades at a discount to its intrinsic value” Miller has reiterated his investment philosophy various times in the letter to shareholders, detailing it as the following 2006 letter:
“Value investing means really asking what are the best values, and not assuming that because something looks expensive that it is, or assuming that because a stock is down in price and trades at low multiples that it is a bargain … Sometimes growth is cheap and values expensive. . . . The question is not growth or value, but where is the best value … We construct portfolios by using ‘factor diversification.’ . . . We own a mix of companies whose fundamental valuation factors differ. We have high P/E and low P/E, high price-to-book and low-price-to-book.”
So Bill Miller looks for under priced stocks.
“We own low PE and we own high PE, but we own them for the same reason: we think they are mispriced.”
Any stock can be a value stock if it trades at a discount to its intrinsic value – Bill Miller
The book entitled, “Man Who Beats the S&P: Investing with Bill Miller”- paperback published on October 3, 2002, is perhaps the only value investing book available today.
The book focuses on value investor Bill Miller and examines the techniques that have made Miller a celebrity investor amongst the investment community.
Bill Miller takes the classic concept of value investing and makes it relevant to today, particularly in emerging markets.
Readers are introduced to Miller’s belief that “the value of any equity depends on the future, not the past”
The value of any equity depends on the future, not the past – Bill Miller
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