These managers are great stewards of shareholders' money.
Toward the end of each year, Morningstar fund analysts nominate their choices for domestic, international, and fixed-income managers of the year, and at year's end we choose the winners.
Although it's called manager of the year, we look at much more than single-year returns. We seek to reward managers who have made a lot of money for people over the long haul.
We look for managers who are great stewards of shareholders' money, meaning they always do the right thing. They keep expenses and trading costs down. They write thoughtful shareholder letters that explain what's really going on at the fund. They close a fund in a timely fashion. They invest a substantial sum of their own money in their funds.
Finally, we look for managers with well-designed strategies who aren't afraid to do something different from the crowd. So, with that preamble, here are our five finalists for Domestic-Stock Manager of the Year. We'll announce our international and fixed-income nominees in separate articles.
This year, performance has been driven by investments from both the main and secondary strategy. In the great managers camp there's top holding Berkshire Hathaway
Mason Hawkins and Staley Cates
Bill Miller is a believer that you have to risk investor scorn and buy controversial stocks in order to beat the indexes over the long haul, and Longleaf embodies that idea, although their brand of value is different from Miller's. The idea is to protect shareholders' money by insisting on a discount of at least 40% to the team's estimate of intrinsic value. If not enough stocks make the cut, management will hold cash, and if that state continues for a while, they'll close a fund. In fact, both Partners and Partners Small-Cap are closed.