Morningstar Names Top Managers

In 1998, only one out of eight fund managers managed to beat the S&P 500 Index and close to 90 percent of all domestic-equity funds trailed the benchmark index.

Morningstar, the mutual fund rating company, is out with its top fund managers of 1998, which recognizes portfolio managers

Legg Mason's William H. Miller III received Morningstar's Fund Manager of the Year award in the Domestic Equity category for beating the benchmark by nearly 20 percentage points in 1998 and for making this his eighth consecutive year to come out ahead of the index.

Miller manages the Legg Mason Value Trust (LMVTX) and Legg Mason Special Investment Trust(LMASX) funds.

Morningstar said Miller set himself apart from traditional value managers by holding stocks for the long term to take full advantage of runups in prices. By buying America Online (AOL) stock after it had lost more than half its value in 1996, Miller was able to achieve triple-digit annual gains.

Morningstar, which bestows the award in three catetories, also recognized managers in the Fixed Income and International arenas.

• William H. Gross shares the spotlight with his management team in the Fixed Income area for their handling of PIMCo Total Return (PTTAX), PIMCo Low Duration (PTLAX), and other PIMCo funds. Morningstar applauded PIMCo's ability to take advantage of declining interest rates while protecting shareholders from losses by taking a more defensive position in time to avoid shakier markets.
• Mark Yockey of the Artisan International Fund (ARTIX) was awarded Manager of the Year in the International category. Morningstar noted Yockey's willingness to move boldly into international markets where he sees strong potential growth, taking large positions in markets not widely favored by other foreign-stock managers.

Tom Addis III, past president of the Professional Golfers Association, is one of the trustees for the new fund family. With the fund investors "watching a major golfing event are able to say, 'Now I am part of the game'," Addis said. Co-managers of the fund are Value Trend founders Ross C. Provence and his son Jeffrey R. Provence. The senior Provence also manages the newly introduced Value Trend Large Cap Fund.

Holdings in the golf fund include not only companies associated with the golfing industry but also tournament sponsors. As of Tuesday, the portfolio consisted of Textron (TXT), producer of the E-Z-GO golf cart, EMC Corp. (EMC), sponsor of the EMC Kaanapali Classic; Adams Golf (ADGO), Ingersoll-Rand (IR), Nike (NKE), DaimlerChrysler (DCX), Gateway 2000 (GTW) and Healthsouth (HRC). So what your really getting is a ross-sector fund of blue chip, tech, leisure and health stocks.

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