“Within less than two years, Bruce Berkowitz, founder of Fairholme Funds, went from being a hero to being a zero in the eyes of fickle investors. On January 12, 2010, Morningstar gave Berkowitz the Fund Manager of the Decade award. Everything was perfect. Everybody was in love with this guy. As investors piled in, his assets under management grew from $10 billion to $20 billion.
Unfortunately in 2011, the love affair ended. He officially “lost his touch.” He was down more than 30 percent, and clients were pulling their money out. It did not matter that he was still up almost 200 percent since his fund’s inception on December 29, 1999, versus 7 percent for the S&P 500. In the money management business, you are only as good as your most recent performance.”
Then, I said that I had no doubt that Berkowitz was going to come back form the slump which is exactly what happened. Berkowitz is a hero again. Today, the media, redeeming clients, and other investors are torturing Eric Sprott, the founder of Sprott Asset Management. His funds are down a lot over the last three years because the price of gold experienced a significant decline and he had heavy exposure to the mining stocks. So here we go. It is time to abandon him. He has lost his touch or maybe he never had any touch.
I have absolutely no doubt that he will come out of this slump with huge returns going forward. The values in the mining stocks are freaking unbelievable. I already identified four 100-baggers in the making. I have never seen anything like this before. I kid you not. Anyway, Eric if you are down these days, watch this video because this is what is going to happen to you over the next three years.