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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: Sun Tzu who wrote (5831)	3/13/2003 9:10:32 AM
From: JSwanson	Respond to of 25522

OT OT As the size of fund grows to be very large The mentality of hugging the benchmark begins much sooner than you think for large cap managers. A firm that manages $5 billion at say 40 basis points will bring in $20 million in revenues. At $5 billion under total management it is still very easy to move money in a large cap arena. However, the $20 million in revenue to the handful running the money is what has become the focus and the most precious item to protect. It is better to stay near the benchmark and not risk huge client defections. The goal at this point is to grow (shrink) revenues at the same rate as the market. At this point the managers get rich and the client get, at best, index returns. That said there are a few managers that don't follow that path: Dodge & Cox, Pacific Financial Research, etc.