The end of 2010 is near. As a tradition, we are inviting the GuruFocus community to nominate the Investment Guru of Year 2010.
In the past, GuruFocus users voted Warren Buffett (2005), David Dreman (2006), Ken Heebner (2007), Prem Watsa (2008) and Bruce Berkowitz (2009) to be the Gurus of The Year.
For the year, the US stock market had a typical run. S&P 500 started the year at 1115; it reached an intra-year low close of 1022 in early July; and as of today it hovers around 1219, up more than 9% from the beginning of the year. Adding the dividend yield that is associated with the index, stock market actually is having a double-digit gain for the year.
Short of any major adversary development, equity investors will be happy as the year draws to a conclusion.
That does not mean there is any consensus among the market participants on what is next for the economy and the markets. Even among the savviest investors, we observed divergent opinions: For example, in the bullish camp, Warren Buffett, the carrier of value investing flag, has said he prefers stocks over bonds. But then, Buffett is always bullish on stocks. His stock-picking skills have enabled him ride the booms and busts of the markets very handsomely; David Dreman, another legendary value investor, has claimed investors are having “Battered Investor Syndrome”, and therefore, it is good time to buy. Notice that Dreman made his comment at the beginning of July, coinciding the intra-year market low. Good call, Mr. Dreman!
The most outspoken Guru in the bearish camp is John Hussman, who repeats his bearish tune each week these days in his market commentaries. To him, the market is “overvalued, overbought, overbullish”, and it is set up to yield 5% in the next decade; the other predominant figure in this camp is Seth Klarman, who is so disappointed at the lack of opportunities that he is returning portion of the investors’ money to the rightful owners; Klarman invests across the asset class spectrum, and his call is profound.
Then we have Gurus taking the middle grounds. Lean year or fat year, money never sleeps. Investment Manager’s job is to allocate capital and capital they have to allocate, so the name of the game is to pick the right stocks no matter what. Despite his overall bearish assessment, Jeremy Grantham claims high quality US equity as an asset class actually presents compelling value. Grantham’s positive stand on US Blue Chips has been echoed by quite a few other Investment Gurus: Donald Yacktman, Wallace Weitz, Bill Miller, Mason Hawkins, to name just a few. Yacktman, especially, has been rotating into high quality names since the third quarter of 2009.
In the year, we also see Investment Gurus acting on convictions that things are definitely turning for the better: David Tepper, whose fund returned 106.2% in 2009, essentially blew the all-out attack horn for the bulls in his famous interview with CNBC on September 24. Judged by how things turned out since then, Tepper is right. Again! Tepper is trimming Financials to buy Health Care and Technologies, however, our last year’s Guru of the year, Bruce Berkowitz has been persistent in buying financials – AIG, MBIA, BAC, etc. -- the fallen angels of the financial crisis.
Berkowitz also teamed up with Bill Ackman in restructuring General Growth Properties (GGP, Financial). To be fair, Ackman is the real hero in the drama. In 2009, he invested in the stock when it was around $1, strongly believing there was residual value for the equity holders, even in a bankruptcy situation. Later, Berkowitz and Ackman also bought into the debt of the bankrupt company. In October, 2010, GGP emerged from bankruptcy and stock is trading at around $15 today. Ackman’s boldness enriched his investors greatly.
I can go on and talk about the over-the-air debate between Berkowitz and David Einhorn on the investment merits of St. Joe Company (JOE, Financial). But let’s stop here… You saw them all here.
At this time, we would like to invite our users to reflect what the Investment Gurus did and how they did it during the year. What have they done for their shareholders and partners? What have you learned from them throughout the year?
Please nominate the Guru you like the best by typing his/her name in the comment field of this thread and giving a reason briefly.
The deadline for the nomination is Dec. 15.
Thank you for your participation.
In the past, GuruFocus users voted Warren Buffett (2005), David Dreman (2006), Ken Heebner (2007), Prem Watsa (2008) and Bruce Berkowitz (2009) to be the Gurus of The Year.
For the year, the US stock market had a typical run. S&P 500 started the year at 1115; it reached an intra-year low close of 1022 in early July; and as of today it hovers around 1219, up more than 9% from the beginning of the year. Adding the dividend yield that is associated with the index, stock market actually is having a double-digit gain for the year.
Short of any major adversary development, equity investors will be happy as the year draws to a conclusion.
That does not mean there is any consensus among the market participants on what is next for the economy and the markets. Even among the savviest investors, we observed divergent opinions: For example, in the bullish camp, Warren Buffett, the carrier of value investing flag, has said he prefers stocks over bonds. But then, Buffett is always bullish on stocks. His stock-picking skills have enabled him ride the booms and busts of the markets very handsomely; David Dreman, another legendary value investor, has claimed investors are having “Battered Investor Syndrome”, and therefore, it is good time to buy. Notice that Dreman made his comment at the beginning of July, coinciding the intra-year market low. Good call, Mr. Dreman!
The most outspoken Guru in the bearish camp is John Hussman, who repeats his bearish tune each week these days in his market commentaries. To him, the market is “overvalued, overbought, overbullish”, and it is set up to yield 5% in the next decade; the other predominant figure in this camp is Seth Klarman, who is so disappointed at the lack of opportunities that he is returning portion of the investors’ money to the rightful owners; Klarman invests across the asset class spectrum, and his call is profound.
Then we have Gurus taking the middle grounds. Lean year or fat year, money never sleeps. Investment Manager’s job is to allocate capital and capital they have to allocate, so the name of the game is to pick the right stocks no matter what. Despite his overall bearish assessment, Jeremy Grantham claims high quality US equity as an asset class actually presents compelling value. Grantham’s positive stand on US Blue Chips has been echoed by quite a few other Investment Gurus: Donald Yacktman, Wallace Weitz, Bill Miller, Mason Hawkins, to name just a few. Yacktman, especially, has been rotating into high quality names since the third quarter of 2009.
In the year, we also see Investment Gurus acting on convictions that things are definitely turning for the better: David Tepper, whose fund returned 106.2% in 2009, essentially blew the all-out attack horn for the bulls in his famous interview with CNBC on September 24. Judged by how things turned out since then, Tepper is right. Again! Tepper is trimming Financials to buy Health Care and Technologies, however, our last year’s Guru of the year, Bruce Berkowitz has been persistent in buying financials – AIG, MBIA, BAC, etc. -- the fallen angels of the financial crisis.
Berkowitz also teamed up with Bill Ackman in restructuring General Growth Properties (GGP, Financial). To be fair, Ackman is the real hero in the drama. In 2009, he invested in the stock when it was around $1, strongly believing there was residual value for the equity holders, even in a bankruptcy situation. Later, Berkowitz and Ackman also bought into the debt of the bankrupt company. In October, 2010, GGP emerged from bankruptcy and stock is trading at around $15 today. Ackman’s boldness enriched his investors greatly.
I can go on and talk about the over-the-air debate between Berkowitz and David Einhorn on the investment merits of St. Joe Company (JOE, Financial). But let’s stop here… You saw them all here.
At this time, we would like to invite our users to reflect what the Investment Gurus did and how they did it during the year. What have they done for their shareholders and partners? What have you learned from them throughout the year?
Please nominate the Guru you like the best by typing his/her name in the comment field of this thread and giving a reason briefly.
The deadline for the nomination is Dec. 15.
Thank you for your participation.
