Earlie, The best evidence of margin over usage is the Dell thread. A lot of folks lost a ton of money in even such a minor down move as we had last week.
Mutual fund cos. adopt closet indexing and "team approaches" for another reason also. The superstar fund manager system threatens the firm's bureaucracy. I worked for a firm that had a superstar system, American Capital, in the 1980s. That system made them the only mutual fund co. to ever have 4 funds on Forbes Honor Roll 3 years in a row. But the superstar managers "hit the bid" when the job offers rolled in and other future stars were hired. Then, after a couple of more years of superb performance, some were fired for smarting off to mgt. (no, surprisingly enough, I dodged that bullet <g>), some hit the bid and some just quit. The firm finally decided to hire a closet indexer to run the firm and a team approach was adopted. Manager turnover, after a first year bloodbath, cooled down a lot. Of course, the "team" now ranks 50 out of 89 mutual fund companies, whereas in the 80s the superstars ranked number one out of a lesser number of competitors. But they don't have those pesky Forbes reporters bothering them by writing up their funds any more. <g> And they also don't have those annoying sales coming in in volume to disturb the clearing agent.
BTW, another of my former employers, Waddell & Reed, stuck with the superstar system and ranks #2 out of 89 fund families.
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