In Memory of Kramer
September 15, 1992-May 16, 2008
No video this week. I'm going to repost a comment I left yesterday (tidied up a bit) about this article from Morningstar picking five funds for the next 15 years.
Five funds for 15 years is a ludicrous concept. The way in which people skim articles they might get the impression you can buy these funds for that long without doing follow up over time.
They like several funds for the manager. I am in no way taking a shot at any of the managers but a lot can happen to a manager in five years.
Remember Foster Freiss, Alberto Vilar, Bill Miller and the guy who liked Senetek, symbol STNKY, like stinky, Heiko Thieme. Five years is a long time in this context and they are going out 15 years.
This sort of thing is a total disservice. Aside from 15 years being a long time to expect someone with years of successful track record behind them to stick around the only forward looking analysis you can do is to simply say yeah I think this guy will keep doing a good job which is of course no analysis, it is a leap of faith.
No doubt that the track of these guys justifies a leap of faith but there could not have been any analysis done to tell you to buy these funds for 15 years.