Bill Miller Case

In recent years Value Trust has done well, the NAV began to increase since the drop in 2000. The benchmark I used to come to that conclusion is the fact that the NAV and the net assets are still increasing each year and making a comeback from the decrease in 2000. Investment performance is measured as the increase or decrease in net asset value plus the fund’s income distributions, which is expressed as a percentage of the fund’s NAV and also using the absolute dollar value today of an investment made at some time in the past. If an investment has a good performance then that would mean that it is doing well and would probably be a good investment.

A fund’s performance could be explained by finding the net asset value and then computing the annual total return. I don’t think and investment strategy explains performance completely. Investing can be a game of luck, but researching investments can also help in finding the right investments. Following Miller’s strategy would be smart but you can never guarantee a good performance. It will definitely be difficult to sustain Miller’s historical performance, but whoever takes his place in the future could have a good chance of sustaining it if they follow his rules and use the strategy he put together.

Portfolio managers play a huge role in the mutual fund industry, they are the ones who put together an investment strategy and choose the investments. Technical analysis is based on past trends in the stock market and fundamental analysis is based on the economic fundamentals of the company. Mutual funds are able to perform up to the market on a gross returns basis, but once expenses are factored in they underperform the market. Capital-market efficiency measures the accuracy of a stock’s price. A weak form of efficiency says that stock prices follow a random walk and has no correlation with past patterns. A semistrong efficiency states that today’s prices reflect all past prices and all publicly...