Warren Buffett, that deity of value investing from Omaha, has long counseled patience in the stock market. Wallace Weitz, a lesser-known Omaha money manager and a Buffett acolyte, needs investors' patience nowadays.
Weitz's largest mutual funds have been laggards recently. Since Jan. 1, 2005 his two main funds, Weitz Value and Weitz Partners Value, have delivered cumulative returns of --0.5% and 0.8%, to the S&P 500's 10.8%. Impatient investors have yanked $1.5 billion out of Weitz Value (now with $2.9 billion in assets) and $990 million out of Partners Value (now $1.9 billion). And that's on top of the $840 million they pulled from the funds in 2004.
Wally Weitz is philosophical. "It is impossible to earn above-average long-term returns without being willing to be out of step with the market from time to time," says Weitz, 57, a plainspoken guy with a penchant for plaid shirts. "These are the times that set up the portfolios for superior long-term performance." As Buffett has put it: "You can't buy what is popular and do well."
Weitz, who toyed with joining the Peace Corps after college but chose Wall Street instead, moved to Omaha in 1973. Working for brokerage Chiles, Heider in the 1970s, Weitz met Buffett at a bridge game and attended annual meetings of Buffett's holding company, Berkshire Hathaway (nyse: BRKA - news - people ), where he drank in the great man's wisdom. "I was fortunate enough to have caught on to it early," Weitz says, referring to the art of value investing. He bought Berkshire shares at $270 in 1979.
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Weitz's largest mutual funds have been laggards recently. Since Jan. 1, 2005 his two main funds, Weitz Value and Weitz Partners Value, have delivered cumulative returns of --0.5% and 0.8%, to the S&P 500's 10.8%. Impatient investors have yanked $1.5 billion out of Weitz Value (now with $2.9 billion in assets) and $990 million out of Partners Value (now $1.9 billion). And that's on top of the $840 million they pulled from the funds in 2004.
Wally Weitz is philosophical. "It is impossible to earn above-average long-term returns without being willing to be out of step with the market from time to time," says Weitz, 57, a plainspoken guy with a penchant for plaid shirts. "These are the times that set up the portfolios for superior long-term performance." As Buffett has put it: "You can't buy what is popular and do well."
Weitz, who toyed with joining the Peace Corps after college but chose Wall Street instead, moved to Omaha in 1973. Working for brokerage Chiles, Heider in the 1970s, Weitz met Buffett at a bridge game and attended annual meetings of Buffett's holding company, Berkshire Hathaway (nyse: BRKA - news - people ), where he drank in the great man's wisdom. "I was fortunate enough to have caught on to it early," Weitz says, referring to the art of value investing. He bought Berkshire shares at $270 in 1979.
Read the complete article at Forbes
