This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

10 Longest-Held Stocks of Top-Rated Mutual Funds (Update1)

(Story updated to add that Goldman Sachs downgraded Whole Foods Market to "neutral" from "buy" on valuation concerns.)

BOSTON ( TheStreet) -- Stock market experts are saying there's are still a lot of economic issues to worry about despite the first quarter's stellar performance. That should have investors thinking about rebalancing their portfolios to preserve some of those gains.

So with a view toward turning to more conservative, less volatile stocks, I reviewed the portfolios of eight of Morningstar's most highly rated big mutual funds to search out stocks that those funds have held the longest. Such longevity imparts a greater degree of confidence in them on the part of the fund managers.

Given most mutual fund managers' reputations as quick-on-the-draw traders, these funds have held some stocks for a surprisingly long time, including one 28-year-old pick. But it's worth noting that many fund managers change the size of their allocation to a particular stock or it changes due to other variables. And some funds may close out positions in long-held stocks only to reinitate them at a more opportune share price.

The $21 billion American Funds American Mutual Fund (AMRMX) has owned computer-industry bellwether International Business Machines ( IBM) since 1984. Its next-oldest holding is drugmaker Bristol-Myers Squibb ( BMY), which it bought in 1993.

Clearly, the fund's managers think the old fellas still have room to run as both stocks are currently in the fund's top 10 holdings.

The $5.5 billion Sequoia (SEQUX) isn't far behind in the longevity race, as it has owned Warren Buffett's Berkshire Hathaway (BRK.B - Get Report) since 1990. And the fund's managers still have faith in its value as Berkshire is currently the second-largest portfolio holding at 7.7% of the fund.

Sequoia owns only 37 stocks. It has an average annual return of 24% over three years.

Given its 931-stock portfolio, a stock could potentially hide out for decades in the $36 billion Fidelity Low-priced Stock Fund's ( FLPSX) portfolio, but that's not the case, given this fund's sterling track record. Although it has owned the aviation and marine fuel services firm World Fuel Services (INT - Get Report) since 1991 and curling iron maker Helen of Troy Ltd. (HELE) since 1995, both stocks are earning their keep.

The Fidelity fund is up 14% this year and has a three-year average annual return of 28%.

On the other end of the spectrum of portfolio size, the focused, 28-stock portfolio of the FMI Large Cap Fund (FMIHX) has held a stake in Kimberly-Clark (KMB), the maker of consumer products such as Kleenex and Kotex, for a decade, and it's now its eighth-largest holding at 4% of the portfolio. The $5 billion fund has a three-year average annual return of 22%.
1 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
ADP $88.46 -0.72%
BMY $72.23 -0.04%
BRK.B $145.57 -0.34%
INT $46.74 -1.60%
IBM $145.95 -0.76%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs