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September, 2002


Proponents of growth vs. value may debate endlessly which of these is the better long-term approach. We happen to favor value, but, in the end, prefer whatever method or mutual fund manager can get the best results.

Thanks to the latest issue of "Forbes," the reader may see just which funds have been the top performers over a nearly twelve year period (10/31/90 - 7/31/02).

Among these, I have selected the top five diversified mutual funds, based on their annualized total returns, assuming reinvestment of dividends and capital gains and deductions of fees and upper-income taxes. For more details, we heartily recommend the "Forbes" article (pp. 116-117 of the 9/16/02 issue).

Here, then, are the winners:

Fund NameToll Free No.Annual
per $100
(after fees
and taxes)
(before fees
and taxes)
Mairs & Power Growth Fund800-304-7404$0.768%17%19%
Muhlenkamp Fund800-860-3863$1.2111%17%17%
Longleaf Partners Fund800-445-9469$0.9418%16%19%
Heartland Value Fund800-432-7856$1.2956%16%18%
Clipper Fund800-776-5033$1.0823%16%19%

The returns were rounded to the nearest %. Average annual expenses per $100 were $1.06. Average yearly turnover was 23.2%. Despite the recent bear market, if on 10/31/90 an investor had put $10,000 into each fund ($50,000 total), reinvested all dividends and capital gains, paid fees and taxes (at an upper-income level), and redeemed the net assets effective the market close on 7/31/02, he or she would have $295,145 at the end of the 11¾ year investment period. Now that's how to "show me the money!"


Larry is not a professional. Don't take him seriously!

Actually, the investment article provided here is for general information only and should not be considered as professional advice, a solicitation to buy or sell any security, or the Word of God. Investors are encouraged to do their own research while considering their personal goals and circumstances, or consult their own professional financial advisors, before making investment decisions. Neither Larry nor LARVALBUG will be liable for any losses sustained by any visitor to this site.

(Disclosure statement: Larry and Val have holdings in some of the suggested assets but do not "make a market" in any of them and do not derive any direct benefit from recommending them, except perhaps for a bit of smug self-satisfaction.)

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