Bear-Bull Hybrid Is Beating the Market

He had a few other winners outside of energy. Chief among them was Avnet (AVT Quote), an electronics distributor. The stock collapsed in a profits warning a year ago. Rodriguez ran the numbers and decided Wall Street had badly overreacted.

Like any true value investor, when he bets, he bets big. Rodriguez threw 10% of his fund into the stock at prices starting below $17 a share.

Today? It's $41.75.

That's some return. Fortune favors the brave.

But then, Rodriguez is no newcomer to this game. He's put together a terrific long-term record at FPA Capital since the fund launched in 1984.

He's beaten the market by an average of six percentage points a year over 10 and 15 years, according to Lipper.

Six points a year.

That's even though he's behind during the boom of the last three.

As for opportunities out there right now? He doesn't see a lot.

If any.

"Just because somebody else wants to jump off a cliff doesn't mean I have to follow them," he says of this market. "I'm not a relative value manager, I'm an absolute value manager."

In other words, if he can't find anything really good to buy, he can sit on the sidelines and wait for better opportunities. Most mutual fund managers don't have that flexibility. They have to be fully invested.