- NEW YORK (CNNfn) . Whether he’s strolling in London’s theater district, exploring Beijing or cheering on his beloved New York Yankees, fund manager Lawrence Fuller can’t forget about the $8 billion he left at the office.|
Fuller, of the Merrill Lynch Fundamental Growth Fund, doesn’t even mind when overseas traders call him at 2:30 a.m. to talk about the market. He jokes that investment research is his hobby.
"It’s always on my mind,” Fuller, 58, said of his work. "I don’t know how some people can spend a lot of time on golf courses doing what we do. Somebody asked me once, ‘How do you ever relax?’ You don’t.”
The fund’s class D shares, with about $950 million in assets, are up 27.1 percent year to date as of Nov. 26. Overall, Fuller manages eight funds with assets of roughly $8 billion.
While the fund hasn’t delivered the high-octane results of some of its peers, it has a coveted five-star rating for risk-adjusted returns at Morningstar. It ranks 258 out of 639 large growth funds tracked by Morningstar for year-to-date returns as of Oct. 31.
The fund also has the best record over two, three, four and five years at Merrill Lynch out of about 25 stock funds.
"This is one of the bright lights over there,” Bill Dougherty, a fund analyst at Kannon Bloch Carre, said about the fund.” It’s one of the best in the growth category at Merrill.”
Fuller sounds a little like a professor when he talks about Wall Street, because he once had aspirations of getting a PhD in economics so he could teach. Ask him where the market is heading and he’s likely to throw out phrases like "commodity price reflation” and "cost push price inflation.”
He grew up outside Boston and graduated from Bates College and Columbia University business school. He likes to joke that he ran out of money trying to get a doctorate.
Higher learning is so dear to him that the only role model he could name was a professor at Columbia that he called an "academic Warren Buffett.” And he speaks in revered tones about his late father-in-law, Fletcher Green, a longtime history professor at University of North Carolina at Chapel Hill, who graduated more than 100 PhDs.
He met his wife, Elizabeth, in the library at Columbia.
From ivy walls to Wall Street
"Back in early 1968 after I got my M.B.A., the education market collapsed, and you couldn’t get a job (at a university) sweeping floors,” Fuller said. So he went to work for Irving Trust Co. as a stock analyst.
Fuller later managed Union Carbide’s $1.5 billion pension plan as the company’s chief equity officer, and delivered such strong returns that when the company started a new pension plan they didn’t need to fund it -- they just used profits from the old account. "Some years we made more money than the corporation,” he joked.
He joined Merrill Lynch in 1992 and took over the fundamental growth fund in 1994.
(Click here to see Morningstar's latest analysis of Merrill Lynch funds).
The fund invests in large companies with a market capitalization of $20 billion to $75 billion that are growing rapidly from new product lines and capital investments, Fuller said.
But the most important investing theme these days is communication equipment companies that are benefiting from the explosive growth of the Internet.
Some favorite stocks
For example, Cisco Systems (CSCO), the fund’s largest holding, produces software for running Internet networks that is the industry standard, he said.
Lately, he’s also been buying Sun Microsystems (SUNW), a leading installer of Web sites around the globe; top chipmakers such as Texas Instruments (TXN); and Lucent Technologies (LU), which provides communications systems and software.
He’s also been buying semiconductor maker STMicroelectronics (STM) in France, and Nortel Networks (NT) in Canada, a designer of telecom systems. The fund can invest up to 10 percent of its assets in international companies.
Fuller is upbeat about telecom stocks, and owns Sprint PCS Group (PCS), Sprint FON Group (FON), Vodafone Air Touch (VOD), Mannesmann (1KFMMN). (He declined to comment about Vodafone’s hostile bid for Mannesmann).
Other holdings show that Fuller finds growth in many corners of the market. You’ll see America Online (AOL), but you’ll also see CVS (CVS). He owns everything from drug stocks to banks and media companies. (Click here for a look at some of the fund’s holdings).
But he sold personal computer makers such as Compaq Computer Corp. (CPQ) and Dell (DELL) because he believes the sector is facing tough times. For the same reason, he sold his stake in Microsoft (MSFT).
Off Wall Street, on to Broadway
When he’s not staring into a computer screen, visiting companies or poring over research reports, Fuller focuses his attention on the arts. He and his wife see plays and musicals on Broadway and in London. They also go to the Metropolitan Opera five to ten times a year.
Among his favorite performances recently were Brian Dennehy in "Death of a Salesman,” Kevin Spacey in "The Iceman Cometh,” and Ann Reinking in "Chicago.” He’s crazy for Nathan Lane, and has seen the actor in "Laugher on the 23rd Floor,” "Guys and Dolls,” and "A Funny Thing Happened on the Way to the Forum.”
But Fuller isn’t always humming show tunes. He and his wife are avid fans of baseball’s world champion Yankees and the National Basketball Association’s New York Knicks. He has season tickets to the Yankees, but gave up his seats to the last game of the World Series to one of his three sons. He also follows the teams at North Carolina, where all of his sons went to school.
Traveling is another interest of Fuller’s, even though he finds it tough to get away. Just imagine how he felt on a trip to China when he woke up in a hotel room in Beijing at 4 a.m. to discover someone had slipped a note under the door.
"Urgent,” the note said. "Call your boss.”
Fuller had visions of a market crash or worse. But the real agony was when his calling card wouldn’t work.
"I didn’t know what it was,” he recalled. "I had all these horrible things going through my mind.”
As it turned out, it was good news. His boss wanted to put him in charge of another fund. But it was a sharp reminder for somebody who loves his job about the perils of being far away.
"I love what I do,” he says. "It’s just very demanding.”
It makes you wonder what he’ll do when he retires. Maybe go back to school.