Legg Mason has named a successor to Legg Mason Capital Management Value's Bill Miller, though the famed manager may still be a long way from retirement. The firm has begun informing clients that Sam Peters will be the next portfolio manager of the fund Miller has managed or comanaged for nearly 30 years.
The firm hasn't yet said exactly when Peters will take the reins. It's likely Peters will share portfolio-management duties with Miller for a while before taking over as sole manager. That's the same path Miller followed; before he took over the fund in 1990, he comanaged it for eight years with Ernest Kiehne.
Miller and Value are best known for beating the S&P 500 in 15 straight calendar years through 2005. But the fund endured a poor period from 2006-08. As a result, its 10-year trailing return has sunk to the category's bottom. But its 15-year record remains in the category's top quintile. And since Miller took sole control of the fund in 1990, it has gained an annualized 9.8%, topping the S&P 500's 8.8% return and the category's 7.7% gain over that period. Legg Mason Capital Management Value Fund, which is available for sales in Hong Kong, is the cloned version. It also gave out disappointing results. The 3-year, 5-year and 10-year annualized return badly dropped 21.29%, 9.55% and 4.16% respectively, all underperformed category average.
Peters joined the firm from Fidelity in 2005 as an analyst and currently runs Legg Mason Capital Management Special Investment, which has a performance pattern similar to Value's. He served as comanager for a short time alongside Miller before being named sole manager in early 2006. Peters will remain at the helm of Special Investment.
Legg Mason hasn't addressed succession plans for another Miller-run fund: Legg Mason Capital Management Opportunity.
