Explain How Miller Was Able To Outperform The S & P 500 For So Many Years?
Every day mutual fund portfolio is marked to market i.e market price of each investment will fluctuate on daily basis because of the ups and downs in stock market therefore the NAV( Net Asset Value) of the each day differs from the previous day. NAV is the value of each share invested in mutual funds and is calculated as
NAV= market value of the fund assets - liabilities/ fund's outstanding shares
In short mutual funds are priced on the basis of NAV and on a current date one could not use the previous day NAV.
Expense ratio is the fee charged by the mutual fund manager to manage the investor's money. It includes all the expenses required to run a mutual fund. For example it includes the registrar fee, fund management fee, distributor commission, advertising expense …show more content…
With the help of this approach they can select such assets whose value is expected to increase with time by calculating the intrinsic value of an asset using data such as revenue, expenses etc.
Miller was a fundamental analyst as he invested in securities by looking at the economic perspective of those securities that made him always a successful fund manager.
Q4) Explain how miller was able to outperform the S & P 500 for so many years? What strategies he adopted.
Miller was able to outperform the S & P for so many years because he was very dedicated and was supported by luck as well. Secondly he was successful because of staying fully invested at all the times rather than doing timely investments. He adopted many strategies as well that are explained one by one.
1) Buy low price, high intrinsic value stocks: It indicates to pick such securities that could be currently bought at low price but its value is expected to increase in future.
2) Take heart in pessimistic markets: To take interest in such markets in which there is expectation of something worse to
NAV= market value of the fund assets - liabilities/ fund's outstanding shares
In short mutual funds are priced on the basis of NAV and on a current date one could not use the previous day NAV.
Expense ratio is the fee charged by the mutual fund manager to manage the investor's money. It includes all the expenses required to run a mutual fund. For example it includes the registrar fee, fund management fee, distributor commission, advertising expense …show more content…
With the help of this approach they can select such assets whose value is expected to increase with time by calculating the intrinsic value of an asset using data such as revenue, expenses etc.
Miller was a fundamental analyst as he invested in securities by looking at the economic perspective of those securities that made him always a successful fund manager.
Q4) Explain how miller was able to outperform the S & P 500 for so many years? What strategies he adopted.
Miller was able to outperform the S & P for so many years because he was very dedicated and was supported by luck as well. Secondly he was successful because of staying fully invested at all the times rather than doing timely investments. He adopted many strategies as well that are explained one by one.
1) Buy low price, high intrinsic value stocks: It indicates to pick such securities that could be currently bought at low price but its value is expected to increase in future.
2) Take heart in pessimistic markets: To take interest in such markets in which there is expectation of something worse to