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Morningstar Minute: A Fund That Defies Logic

Russel Kinnel

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Russ Kinnel: Fidelity Contrafund is really an unusual fund. [Manager] Will Danoff has been there since its inception, which is nearly 25 years ago, and it really almost defies logic. It's over $100 billion in assets. And so Will Danoff is running much more than any individual stock-fund manager I know of.

It really shouldn't work. He runs a very diffuse portfolio with lots of stocks, and yet it's not an index hugger. It really almost doesn't make sense. But he's just someone who's got a strategy that's very well-suited to large asset bases. He's able to overcome all of those challenges, and he does it in part by being really ahead of the game. He will make sector moves wisely, and he's really good at staying in touch with where the economy is going. He takes lots of CEO visits coming into Fidelity. He will meet with a bunch of them. And he is very good at taking all of that information, taking all the information from analysts and synthesizing that into a useful portfolio.

[We assign it a Morningstar Analyst Rating of Silver] because of the asset base. If it were a smaller asset base, we would probably rate it Gold. But that asset base is a real handicap. I think Danoff would have even better performance without it.

But you really can't argue with that record of success; he's just a really great growth manager.