Tracking Money Managers

Andrew Bary in Barron's writes about something readers of sites like Controlled Greed.com are familiar with: tracking the holdings of successful money managers.

Of the investors mentioned in Bary's piece, Mason Hawkins and Staley Cates of Southeastern Asset Management are most familiar to me and my readers. Though, make no mistake, everyone named in this Barron's piece ranks as a more-than-noteworthy investor.

This is a fine article -- typical of Barron's in general and Bary in particular. And I'll only add these points:

• Following the holdings of successful investors is something EVERY portfolio manager does and you should, too, if you're managing own money.

• This is a great time-saver for individual investors, because you can piggyback off the research departments everyone from Mason Hawkins to Peter Cundill to Marty Whitman. And on and on.

• This is a great starting point, but shouldn't be an end-all in an investor's search for stock market bargains. Read, read and read some more. If you're not naturally a reader in your daily life, you might consider hiring someone to manage your money, or check out mutual funds.

• When reviewing a money manager's holdings, find out what price he or she paid in establishing the positions. Many times the price they paid is much lower than the price the stock is trading for by the time it's reported.

• Always remember that most of these successful investors are managing portfolios worth BILLIONS of dollars. This means they can't take advantage of many smaller companies that might be bargain investments. But you and I can.

Like anything else in investing or life, tracking the moves of successful money managers isn't a Silver Bullet. But it can be an excellent tool in finding investment opportunities.