Active Managers Riding Apple's Coattails

Bloomberg is out with a look at actively managed mutual funds who’ve seen a big chunk of their returns come from simply overweighting Apple ($AAPL) over the last several years…

William Danoff might want to send a thank-you note to Steven Jobs, Apple Inc. (AAPL)’s chief executive officer .

Danoff’s $78 billion Fidelity Contrafund got 13 percent of its return over the past two-and-a-half years from its stake in Apple. The fund, a portfolio with 494 stocks as of June 30, is one of six among Apple’s 10 biggest U.S. mutual fund holders who can credit at least 13 percent of their return since 2009 to the technology giant, data compiled by Bloomberg show.

Apple, the maker of iPhones and iPads, has risen five-fold since early 2009, powering the stock market rally and attracting top mutual-fund and hedge-fund managers searching for returns.

The truth is, this is what managers are supposed to do.  If you manage a large cap growth portfolio, can you give me any better example of a large cap growth company over the past century than Apple Computer from the mid-aughts now?

In fact, if your large cap growth manager was only equal-weight or even underweight the name, what exactly is doing all day?  Why are you even paying him?

The more interesting question is, where do they go for those outsized returns once Apple’s stock price succumbs to the “Law of Large Numbers” and slows down a bit?

Danoff Leads Managers Relying on Jobs With 13% Boost From Apple (Bloomberg)


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