Veteran portfolio manager Bill Miller, founder of Miller Value Partners and manager of the firm’s Miller Opportunity Trust and the Miller Income funds, retired at the end of 2022, reports an article in CityWire. He had announced his retirement at the beginning of 2022, saying at the time that it was “both prudent and in the best interest of the funds’ shareholders to begin the transition of the funds’ managements and the firm’s ownership…to the next generation.”
The plan for Miller Value Partners is to divide the firm, with Samantha McLemore heading up the Miller Opportunity Trust under the umbrella of her own venture, Patient Capital Management. McLemore has co-managed the fund, which holds $1.1 billion and has been renamed the Opportunity Trust under Patient Capital, since 2008. Meanwhile, Miller Value Partners will maintain ownership of the Miller Income fund under the management of Miller’s son Bill Miller IV, who has overseen the fund since its launch in 2014, the article details.
Miller got his start under Peter Lynch at Fidelity Magellan as part of select group of “star” active managers and went on to found Legg Mason. He earned his reputation after solidly beating the S&P 500 for 15 straight years from 1991 through 2005 with the Legg Mason Value Trust (now known as the ClearBridge Value fund), where he recorded a 16.44% annualized return, compared to the 11.52% return from the S&P 500. While big tech was a large part of his holdings, Miller considered himself a value investor, and often forecast cashflows for various companies way into the future by assigning aggressive estimates to present values—a strategy that most other value investors shied away from. But while he managed to weather the dot-com crash, he was not as fortunate during the financial crisis as he’d invested heavily into Bear Stearns before the bank’s implosion, according to the article.
In 2016, Miller left Legg Mason (then known as LMM LLC), striking a deal with the company to buy out the LMM’s stake in his investment firm. He managed the Opportunity fund for 23 years, posting a 4.76% annualized return while the S&P 500 posted 6.28% for the same period, which includes both the extreme downs of the financial crisis and the sky-highs of 2019 and 2020, posting 33% and 37.6%, respectively. However, the fund has been down since 2021, losing 3.95% that year and then 36.6% in 2022.