REGARDLESS OF YOUR LEVEL OF skill, education or experience, invest in the markets long enough and you’ll eventually encounter a losing streak that makes you wish the opening bell never rang. Speculation is not a savings account, and losses, oftentimes serious ones, will for a time plague even the most pedigreed of portfolios.
So although Bill Miller is still heralded as one of the best portfolio managers around, he too was pummeled by the brutal bear market. An investment in his Legg Mason Value Trust (LMVTX) dropped some 40% from 2000 through early 2003.
Or take legendary portfolio manager Stanley Druckenmiller. In early 2000 he left George Soros’ Quantum Fund after bad technology bets erased almost $3 billion — more than 20% of the hedge fund’s assets. (more…)