i need a reality check

More on Bill Miller

Posted in random by josh duncan on December 11, 2008

Still thinking about Bill Miller and found several blog posts with thoughts on what can be learned from his mistakes.  So, if you are in the mood for more, read on here:

FinanceProfessor.com :

It is fascinating that the big collapses (he financial debacles that are studied years later as well as the crushing military defeats) often happen after a long period of wins. Why? Because the decision makers fall in love with their ability (over confidence) and believe that just because it worked in the past, it will work again.

Random Roger’s Big Picture:

It seems pretty clear that he really believes (maybe now it would be believed) in buying more as they went down. This was a contributing factor to his success, and make no mistake he was wildly successful for a long time, and also a contributing factor in his..what should we say..fall from grace or whatever.

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4 Lessons From the Failure of Bill Miller

Posted in resources by josh duncan on December 11, 2008


Bill Miller is a “legendary” mutual fund manager that beat the S&P 500 for 15 consecutive years (a monumental accomplishment).  The WSJ had a play-by-play article today about his spectacular implosion (check out the cool WSJ interactive graph showing his performance here) and it got me thinking about what can be learned from this meltdown.  Here are the top four things that came to mind:

  1. Always due your due diligence.  Just because you are getting advice from a proven expert does not mean that the expert is mistake proof.
  2. Never stop learning and asking, “what has changed?”.  Your playbook may work over and over again but don’t let the rules of the game change while you are not paying attention.
  3. Beware of “Escalation of Commitment“.  You can fool yourself into thinking that you have no choice but to continue down a path (throwing good money after bad seems to the theme for Bill during 2008).
  4. All it takes is one mistake and no matter how “legendary” you are, you will be out on your butt.

Any more to add?