Philip Carret of the Pioneer Fund Profiled at StreetStories
October 08, 2005
Market Wizards Index: +13%
Compound annual over 55 years
Fund or affiliation
Pioneer Fund
Methodology
Value investing in OTC stocks.
Research Techniques Employed
Reappraise positions held at least once in 6 months.
Consider dividend yield the least important factor.
Trading Techniques Employed
Be quick to take losses, and reluctant to take profit.
Never hold fewer than 10 securities covering 5 sectors.
Never put more than 25% in any security about which detailed information is not readily and regularly available.
Keep at least half of the fund in income producing securities.
Borrow sparingly and only when stock prices are low, interest rate is low or falling, and business depressed.
When stocks are high, rates rising, business prosperous, put at least half in short-term bonds.
Philosophy and beliefs
He likes OTC stocks, "I’ve always been in offbeat stuff. They are less subject to manipulation than NYSE co.’s, and are less affected by crowd psychology."
Like Buffett, he seeks what nobody wants, dull stocks like waterworks or bridge companies, and doesn’t mind to sit dead in the water for long periods.
Seek facts diligently; advice never.
Avoid insider information like the plague.
Ignore mechanical formulas for valuing securites.
History and other facts
Berkshire Hathaway was an OTC run by Warren Buffett, Carret’s friend. They exchanged ideas regularly for many years.
Carret worked for Barron’s as a features writer.
Examples
Magma Power a utility in California.
Natural Bridge Co. of Virginia.
Performance Record
13% over 55 years.
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