5 (B) Critically assess Bill Miller’s investment philosophy
Bill Miller is the chairman and CEO of Legg Mason Capital Management. Legg Mason Capital Management is an investment management firm with more than $60 billion under management. Bill Miller actively operates the Legg Mason Value Trust mutual fund, which has a lengthy history of outperforming the S&P 500 benchmark (Jim, 2010). Bill performed a stint in U.S military intelligence after graduated from Washington and Lee universities in 1972. With a high interest in philosophy, Bill is broadly known for a number of popular quotes. One of his famous quotes is “Lowest Average Cost Wins”. From the year 1991 to 2005, the fun he operates outperformed the S&P every year. As of 30th June 2008, its 10-year return finally falls behind the index. Bill Miller’s investment philosophy doesn’t suit for everyone. It requires high self-confidence, hard work, diligence, patience and attention. But his ways also have their returns. They are perfect for those who are analysis, like research, updated with reality of a business and welcome constant self-education and re-education. Below are some of Bill Miller’s investment philosophies. Develop the investment tactics as the environment changes, always maintaining a value orientation. Bill Miller draws inspiration and understanding from every area of knowledge (Hobson, 2012). His pragmatic mentality and multidisciplinary taught have kept him from being involved in specific analytical methods, or arbitrarily excluding diligence, such as technology, from the investigation for bargains. Accept the strength but not the weaknesses, of the rivalry: the S&P 500. Similar to the S&P 500, Miller invests for the long- term outstanding fully invested with fewer turnovers (Nocera, 2013). While selectively paring the losers, he allows the winners run. But he applies a more stylish business choice plan and is more sensitive to valuation, buying undervalued...
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