Energy stocks helped propel the managed equity accounts that topped Morningstar Inc.'s manager performance database for the year ended March 31.
The median return for managed domestic overall equity accounts for the 12 months through March 31 was 8.3%, above both the 6.7% return for the Standard & Poor's 500 index and the 5.4% gain for the small-cap Russell 2000 benchmark. For the latest quarter, the median return was -1.9%, better than the S&P 500's -2.2% and the Russell 2000's 5.3% tumble.
Three of that universe's top 10 performers for the year, including The Mitchell Group Inc.'s publicly traded energy portfolio, which came in first with a 50.4% gain, were energy-focused strategies. Managers of the other, largely small-cap and midcap strategies likewise said their holdings of oil and energy service companies contributed mightily to their 25% to 40% gains for the 12-month period.
With oil prices surging, investing in the energy sector last year amounted to "an idiot's hand in poker. You couldn't lose," said Rodney B. Mitchell, president of Houston-based The Mitchell Group. Over the 12-month period, a number of the Mitchell portfolio's oil exploration and production holdings racked up stellar gains, among them: Unocal Corp., up 65%; Kerr-McGee Corp., up 57%; and Newfield Exploration Co., up 55%.