Word: market
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Dates: during 1950-1959
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...trust listed the market value of its stock at just half of what it had paid for it. M.I.T. slimmed its portfolio from 128 to 77 stocks, concentrated in defensive stocks (utilities, foods, tobacco, etc.), better able to withstand the Depression. By 1933 Robinson and his staff saw light ahead, and M.I.T. began switching out of defensive stocks and into railroads, automobiles, mining and steel. With a poker player's eye, Robinson could look at a company's present and guess its future. He personally researched the Texas Co. (now Texaco, Inc.), persuaded the trustees...
...investors continued to pour their money into M.I.T., the trust moved into first place among the nation's mutual funds in 1936, with assets of $130 million (v. $15.1 million in 1930). Despite its bullish position, M.I.T. sailed through the sharp market break of 1937 with hardly a change in its portfolio; it simply put new cash into Treasury notes as a defensive measure. In that year, Dwight Robinson was rewarded for his work by being moved up to trustee. In 1954, when Merrill Griswold moved up to honorary chairman of the advisory board, Robinson slipped into his chair...
...Thus $1,000 invested in M.I.T. shares ten years ago would be worth $3,650 today v. $1,417 if it had been placed in a savings bank at $%. But many a smaller fund that has less to invest, and thus can get in and out of the market more easily, has done much better. Among the top performers in each fund category, the best record of all was turned in by Boston's Keystone 8-4 Fund, with assets of only $31 million. It recorded a 508% gain (see chart...
Nevertheless, some critics insist that buying a mutual fund is just buying a piece of the Dow-Jones industrial average, point out that the top five common stock funds just kept pace with the averages in the seven-year bull market. But Broker Arthur Weisenberger, the Boswell of the industry, whose brokerage house puts out the definitive yearbook of the funds, argues that an investor could pick a slow mover even in the stocks in the blue-chip Dow-Jones averages. Only 14 of the 30 stocks have done as well as the 229% gain in the averages...
...diversification and professional management. If an investor with $4,200 (the average size of a mutual fund holding) tried to buy a diversified portfolio of stocks on the New York Stock Exchange, claim the funds, he would easily have to pay 8% to get in and out of the market...