Bill Miller

Legg Mason star money manager Bill Miller believes the "worst has passed" in the stock market and the economy, and predicted that technology and financial stocks should continue to perform well in a recovery. 'Bargains abound in the U.S. stock market,' Miller, 59, wrote in a letter to investors in his Legg Mason Value Trust fund. 'Bull markets typically begin when the following four conditions are present: the economy is bottoming, profits are bottoming, the Fed is stimulating and valuations are low. That’s where we are now.'

Bill Miller’sLegg Mason Opportunity Trust was the biggest-gaining U.S. stock mutual fund in the second quarter, surging 48 percent as markets responded to signs the recession could be coming to an end. Miller, 59, best known for guiding his Legg Mason Value Trust to a better record than the S&P 500 for 15 straight years. From the end of that streak in 2005 through March 31, the fund slumped 61 percent because of bets on real estate and financial stocks. Value Trust, with $4.2 billion in assets, rose 30 percent in the quarter.

Companies with the most debt and lowest returns on assets are turning the biggest six-week rally in stocks since 1938 into a bloodbath for last year’s best- performing trading strategy. Bill Miller, who lost 55 percent in 2008 running the Legg Mason Value Trust after beating the Standard & Poor’s 500 Index for a record 15 straight years, is topping the measure again. Value investors buy companies that are the cheapest relative to their earnings or assets.

R.I.P., Bill Miller (Legg Mason Opportunity fund, -59% for 2008 through October 30). And Mason Hawkins (Longleaf Partners, -47%), Bill Nygren (Oakmark Select, -36%), Chris Davis and Ken Feinberg (Selected American Shares, -36%), Ron Muhlenkamp (-37%) and the guys and gals at Dodge & Cox Stock (-41%).

Legg Mason Inc's (LM.N) once-celebrated Value Trust fund is set for its worst-ever annual returns in 2008, and some investors grumble that time is running out for its manager, Bill Miller. The flagship stock mutual fund lost 57 percent in the year to December 29, the worst in its class and underperforming the Standard & Poor's 500 Index for the third straight year following the S&P 500's 39.4 percent loss.

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Legg Mason's Bill Miller, a celebrated value investor but whose stock picking is far off the mark this year, said on Wednesday the "bottom has been made" in U.S. equities, and forecast opportunities for strong gains once markets rally.

He said the Federal Reserve should buy stocks and junk bonds to avert a deeper financial crisis, adding "the taxpayer would make a killing" as markets rebound.

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Legg Mason Inc.'s star stock picker Bill Miller said that he is making adjustments in managing his well-known Value Trust mutual fund in light of its weak performance and millions in lost assets. Miller said he would spread out his concentrated portfolio to include broader allocations across sectors. He may buy mega-cap stocks that are trading at depressed prices, that generate cash and are at the top of their industries.

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Legg Mason money manager Bill Miller built his reputation on making contrarian picks, betting on downtrodden stocks to make a comeback. His Value Trust mutual fund beat the S&P 500 Index for 15 straight years before the streak ended in 2006.

Bill Miller, Martin Whitman and David Dreman, mired in the worst slumps of their careers, are poised once again to trounce the stock market.

Faced with two and a half years of subpar investment returns, famed Legg Mason Value Trust money manager Bill Miller recently turned to a support group.