Legg Mason Value Trust (Symbol: LMVTX) is the only fund to have beaten the S&P 500 index for the past 14 consecutive calendar years. Not only that, the average annual return for the last 10 years stood at 18.58% as of 12/31/2004. Comparing that to the 12.07% return of S&P 500 index for the same time period gives an idea that Legg Mason Value Trust hasn’t been barely beating the S&P 500 index. But, it has been beating the index by more than 6% on average.
After tax returns are also phenomenal. For period ending 12/31/2003, the 10-year return after taxes on distributions and sale of fund shares was 15.24% for the Value Trust. Comparing this to the 11.07% after tax return for S&P 500 tells me that the Value Trust has not been beating the index, but it has been actually hammering the index.
After such success one would expect that there would be tremendous asset growth in this fund, but that is not the case here. The fund assets are manageable at around 12 billion dollars. This is not the Dodge & Cox Stock fund situation, where assets are now approaching 40 billion dollars.
Only one thing though, expense ratio of Value Trust stands at around 1.72% according to the prospectus, which is above average for this size fund.