Elle wrote:

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No losses measured from Jan 1 to Dec 31.

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Re-zero your chart in 1977 and you'll see his overall return.

"Will Trice" <wwtrice[at]paragondynamics.com> wrote
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I confirmed this on the net.

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I'm not sure what "calendar year loss" means exactly. I do have web sites
that say he beat the S&P 500 11/13 years. From the chart at the link below,
sure looks like 1987's Black Monday took its toll on Magellan for one year.

http://finance.yahoo.com/q/bc?t=my&s...l&c=&c=%5EGSPC

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If so, I guess it's the reinvested dividends that produced this, because the
chart above from 1987-1990 indicates the S&P 500 crushed FMAGX

But I don't want to nitpick this to death. I trust Peter Lynch did well for
some 13 years, when he retired IIRC, and that is a remarkable record
probably attributable to skill.

Tad Borek wrote:

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Lynch says that his success was due to taking huge positions in a small
number of (large) stocks. In particular, in the final years of his
reign at Magellan (when the fund was at its largest while he was there),
he credits his holdings in Ford, Chrysler, and Volvo for the success of
the fund. He believes Magellan could perform the same today, even given
its size.

-Will

Elle wrote:
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Bill Miller - 14 consecutive years of beating the S&P 500 (so far).
Peter Lynch - 13 consecutive years without a calendar year loss, overall
return crushed S&P 500.

Elle wrote:
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Under the methodology I described in my other post, if I recall
correctly, Lynch's alpha while he was at Magellan was over 0.4% PER
MONTH - after costs - which is outrageously good, in a class by itself.
Not only did he beat the S&P 500, he beat the risk-adjusted benchmarks.

NB: He did this largely by buying small to mid size company stocks.
Magellan couldn't work like that today, it's too big. Problem #2 in
mutual fund manager selection: as funds grow their returns get less
repeatable.

-Tad

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tenure with the Fidelity Magellan fund from the late 1977 to 1990. His
success rate was about 85% plus or minus approx. 100% / sqrt(11). So the
next time he tries, he has a probability of about 55% to 100% of beating the
S&P 500 index. Not too impressive, but nothing to sneeze at either.

On the other hand, probably the more important query is how Lynch does vs.
other managers. Do his stats indicate he has something "extra"?

Suppose another fund manager had a success rate of 7 out of 13 years. A
common statistical test (two proportion Z-test) for checking the differences
between success rates indicates it's highly likely (p-value < 0.05) that the
difference between the two proportions was due to something other than
chance. E.g. Lynch has more skill.

That Lynch has more skill might seem obvious, but when working with such
small data sets, a quick check on the statistical significance (e.g. using
p-values) is helpful. For example, comparing Manager X with a success rate
of 5/6 to manager Y with a success rate of 3/6 yields a p-value of 0.11,
which in statistical circles indicates not a particularly meaningful
difference (at least in my statistical judgement; I go looking for p < 0.05
in quick checks). X may have something "extra," but it's probably wise not
to bet on it with so little data.

Further googling indicates plenty of recognition of fund managers for
one-year performances, but given the education level of this newsgroup's
participants, I think it's fair to say this is media hype and advertising
for the mutual fund industry. It does not mean these "top managers" will do
well the next year.

Based on all this, as well as studies on index fund performance others have
cited here, I endorse the continued promotion of index funds by, I would
say, most people at this newsgroup.

Who are the most distinguished mutual fund managers, and why are they
distinguished?

Please mention only those who have done well over ten years or more.