Three Managers

As you can see, overall they have been in the top percentile ever since they made the change. The Post told the managers to keep at least 25 percent of these funds in bonds, which would not have been necessarily the choice of these managers. So I’ve included the bond performance simply to illustrate that this group has no particular expertise about bonds. They wouldn’t have said they did.

Even with this drag of 25 percent of their fund in an area that was not their game, they were in the top percentile of fund management. The Washington Post experience does not cover a terribly long period but it does represent many investment decisions by three managers who were not identified retroactively.

Table 9 is the record of the FMC Corporation fund. I don’t manage a dime of it myself but I did, in 1974, influence their decision to select value oriented managers. Prior to that time they had selected managers much the same way as most larger companies. They now Appendixes 545rank number one in the Becker survey of pension funds for their size over the period of time subsequent to this “conversion” to the value approach. Last year they had eight equity managers of any duration beyond a year. Seven of them had a cumulative record better than the S&P. All eight had a better record last year than the S&P. The net difference now between a median performance and the actual performance of the FMC fund over this period is $ million. FMC attributes this to the mindset given to them about the selection of managers. Those managers are not the managers I would necessarily select but they have the common denominator of selecting securities based on value.