MEDLEY & COMPANY
An Investment Advisory Firm
December 1998 Investment News
We like to know the people who manage our clients' money.
We've always believed that one of the features that sets us apart from other investment advisors is our on-site visits with the men and women who actually manage mutual funds.
It's one thing to look at their statistics in The Wall Street Journal, to read about them in Barron's and to review the analysts' reports in Morningstar. It's quite another experience to sit and talk with a money manager about his management style and views on the economy.
In the middle of November Tim and Cecil traveled to Washington, D.C. and New York City to visit the managers of nine different mutual fundssome we currently use, others we are only considering.
We hit all the hot spots in our whirlwind tour of New York and D.C.!
Torray, Mutual Series, Scudder, the Selected American, Fidelity, Eclipse, Vontobel, BT International...we really know how to have a good time!
After a 7:20am flight on Wednesday morning to Washington, we swooshed off to Bethesda on the D.C. Metro for our meeting with Doug Eby and Bob Torray of The Torray Fund, a U.S. common stock fund. The fund has earned a terrific track record with its philosophy of purchasing outstanding businesses and holding onto them. They're a fine example of a good fund that does well because its companies do well.
The 5pm Amtrak Metroliner (cheaper and more comfortable than flying) took us to New York's Penn Central around 8pm. After a long day and looking at another tomorrow, all we could manage was a late dinner and an early bedtime.
The Thursday morning traffic report said, "Avoid the New Jersey Turnpike because of a huge wreck." precisely where we were headed. This was our fourth visit with these people; we knew how to get there. We avoided the wreck but not the Turnpike, several wrong turns, getting lost in Secaucus (mentioned recently on NYPD Blue), and finally made it to Short Hills, New Jersey and the Mutual Series Funds. This fund group has produced stellar returns for our clients for a number of years. In a much-ballyhooed event, their widely regarded manager, Michael Price, recently retired to devote his time (and considerable personal wealth) to various charitable causes. Rob Friedman, chief investment officer, met with us for an hour plus, and we were mightily impressed. Rob is very focused, bright, experienced, and confident. ("We keep outstanding people because we pay much more than Fidelity and Putnam.") Even without Michael Price, we look for good things from this group.
Back to Manhattan for lunch (never take the Holland Tunnel if you have to get to midtown) and the global managers at the Scudder group of mutual funds. As we ate exquisitely prepared broiled shark in the corporate dining room, William Holzer opined on economies around the world. Scudder is clearly a classy global management firm.
We spent the early afternoon on 5th Avenue in the offices of Chris Davis, manager of the Selected American Fund. Chris and his dad, Shelby, are always at the Berkshire Hathaway meeting in Omaha, and are pros at investing in U.S. common stocks. Shelby's mutual fund history dates back to the late '60's.
Later we spent time with senior people from The Fidelity organization. Our interest was their brokerage and custodian capabilities. Given their technology and business expertise, it's likely that we will work with them in some capacity in the near future.
DC
"Lately it seems not a day goes by without someone asking me how long the market can keep going up. No one knows. Someday the economy will sag or inflation will accelerate, causing interest rates to rise; or investors may simply run out of money. Sellers will outnumber buyers. Then the market will go down. It has happened many times before. But it should matter only to those who play the market. Long-term investors in solid companies with strong business fundamentals need not worry about it.
Robert Torray, The Torray Fund. February 10, 1996.
Over 3500 points ago on the Dow.
