Pettit Funds

You’ll recall my post a few days ago regarding the Morningstar upgrade of the Marketocracy Masters 100 Fund. Here is more from Yahoo Finance today:

SAN MATEO, Calif.–(BUSINESS WIRE)–Marketocracy Funds¹ announced that the Marketocracy Masters 100^TM Fund (MOFQX) based on the powerful research tool: the Marketocracy m100, received a 5-Star Morningstar Rating^TM for the three-year period ending April 30, 2008 against 429 funds in the Mid-Cap Blend. For the three-year period ending April 30, 2008, the Fund was up 54.70%, doubling the return of the S&P 500 Index,² which was up 26.78% during the same period. As of April 30, 2008, the Fund now has a 4-Star Overall Morningstar Rating^TM.

“Through our proprietary system, we have vast amounts of trading data on over 100,000 model portfolios and that gives us a distinct research advantage,” explained Mark Taguchi, President of Marketocracy Data Services LLC (MDS) which runs one of the most sophisticated virtual stock market trading systems in the world, tracking the detailed trading activity of over 80,000 people managing model portfolios for the last 8 years. “We oversee an extensive farm system of investing talent and the detailed trading data gives us insight on their skills for particular markets which we use to select the m100 and to change the team when needed.”

Changing the Team so Investors Don’t Have to Change Funds

“Exactly three years ago, we made adjustments to our m100 team,” explained, Ken Kam, CEO of Marketocracy, Inc. and portfolio manager of the Masters 100 Fund. “Unlike most funds that stay stuck in an investment category even when it underperforms, the Masters 100 Fund changes so that our investors don’t have to change. Instead of staying in small-cap, where we would have ranked even higher, our team moved to mid-cap, the best performing category over the last three years and a much tougher place to earn a 5-star rating.”

Very few fund companies run a diversified, go-anywhere fund even though most investors would want that for the core portion of their stock portfolio. “It takes a deep bench of investing talent,” said Kam, “and the willingness to take responsibility for changing the team.” [Rest of article]

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GO TEAM!!

Cool!

The mutual fund that is run pursuant to the selections of the Marketocracy organization that I have been a part of for the last 5 years has just been upgraded by Morningstar to a 4-star fund (5-stars for the last 3 years!)

This should have happened sooner, except for a bad year a few years back–which was when Marketocracy took another look at how they were going to be making future selections. They had been buying hundreds and hundreds of stocks based on the selections of their Top 100 investors, and after their bad year started limiting their purchases to those recommended by only the Top 10 investors–which group I have belonged to for the last 3 years. Most of the stocks I have recommended here have ended up being holdings of the mutual fund.

While I have been through a less-than-stellar year since late last summer, if you visit the Marketocracy site you are going to see incredible performances by the other members of the “m10″ (what Marketocracy calls their Top Ten). Hopefully, I’m just pausing to catch my breath…

Anyway, it is exciting to see this experiment starting to pay off for the Marketocracy bunch. I’m going to encourage my kids to put some of their Roth IRA money into the fund.

FULL DISCLOSURE: As a member of the m10, I get a tiny percentage of the “Assets Under Management” each quarter–so of course I may be encouraging all of you to invest there out of sheer greed! Take anything I say with a grain of salt. Furthermore, past performance is no guarantee of future results (I think I read that somewhere…) Oh, yeah–and the Marketocracy site and the Marketocracy Masters 100 Fund are two separate and unrelated entities, blah, blah, and anything else I’m supposed to say to keep the SEC at bay.