NEW YORK (CNNfn) - Fund manager Jeff Lindsey's passion for growth stocks was born working alongside a disciple of value gurus Benjamin Graham and David Dodd.
For seven years, Lindsey followed the investing mandate of "growth at a reasonable price" while a slow transformation was taking place.
"I was irresistibly drawn to growth-oriented companies," Lindsey recalled. "I just found them more interesting."
 Lindsey has been at the epicenter of the growth revolution that's dominated Wall Street in recent years as lead manager of Putnam Growth Opportunities Fund.
The fund, with $7.3 billion in assets, has a coveted five-star rating from Morningstar, putting it in the top 10 percent of its category. It earned 51.40 percent in 1999, 47.40 percent in 1998 and 30 percent in 1997.
The fund had been in negative territory earlier this year, hurt by record Nasdaq volatility, Fed interest rate hikes, and the impact of the antitrust case against Microsoft, a top-10 holding until earlier this year. It recently has recouped some losses and is up 3.1 percent year-to-date through July 10.
A dapper man wearing a pinstripe suit, gold cuff links and well-polished shoes, Lindsey seems pretty relaxed at a time when veteran money managers like Julian Robertson and George Soros are falling victim to record stock market volatility.
The Nasdaq Composite may fall 5 percent in a day, and Fed Chairman Alan Greenspan may be raising rates, but Lindsey seems unfazed.
"We're generally positive," Lindsey said. "The problem we're having now is things are so good in the economy, we're worrying about it."
Growth from value roots
Lindsey, 37, grew up in Long Island, the son of a professor. He always knew he wanted to get into business.
He graduated from University of Virginia in 1984 with a degree in business. He worked for three years at what is now State Street Boston Corp. as an account manager before getting his MBA at Emory University in Atlanta in 1989.
While in business school, he started Strategic Portfolio Management Inc., an investment management firm, with one of his professors, Arthur Dietz. Dietz was a disciple of Graham and Dodd, authors of "Security Analysis." Graham also wrote "The Intelligent Investor," the bible of many value investors.
 "I think academics are more inclined to teach you about the value of things," Lindsey said about Dietz. "I think a value orientation is more popular because you're trying to understand what the true value is of something."
(The company has since changed names and efforts to reach Dietz were unsuccessful.)
Lindsey was an analyst and portfolio manager at Strategic, which managed $100 million in private assets.
"The reason I decided I liked growth better is you wind up not with the best companies, you wind up with companies that are cheap for a reason," Lindsey said. "And you're missing out on opportunities, with stronger companies going by you."
Lindsey came to Putnam Investments in 1994 as an analyst and has managed Growth Opportunities Fund since 1995.
 Since 1998 he's also been on the team of managers at Putnam New Opportunities Fund. The fund, with $18.83 billion in assets, invests in growth stocks of any size. It earned 69.97 percent in 1999, putting it in the top 25 percent of its category.
He lives in the Boston area with his wife and two young daughters. He likes to snorkel and ski, and admits to having a passion for golf.
"I would play golf 20 times as much as I'm able to," he joked.
He's also fulfilling a lifelong dream and is taking piano lessons with his wife and 7-year-old daughter, Patia.
"I was always jealous of people who could play instruments," Lindsey said. "When our daughter started playing I decided to do it too. Now the whole family is learning."
A fund that likes GE and Cisco
Growth Opportunities Fund owns 40-to-50 stocks that have an average annual growth rate of about 25 percent. The fund has about 47 percent of the portfolio in technology, and the top holdings include General Electric, Cisco Systems, and Nokia. He focuses on strong companies in growing industries.
For example, the fund started buying Sun Microsystems around $15 a share (adjusted for splits), and the stock is now trading in the 90s.
 "We've made five times our money on Sun," Lindsey said.
Cisco, the second-largest holding representing 5.5 percent of the portfolio, has a growth rate of above 50 percent in the near term, he said.
"People get this idea that as companies get bigger their growth slows," Lindsey said. "Cisco is defying that."
The Microsoft sting
Lindsey wishes the fund had less of a stake in Microsoft earlier this year when its stock fell as much as 48 percent. The fund started selling the stock and it fell out of the top 10.
"It's not surprising to go through a difficult period, especially with interest rates (rising)," Lindsey said of the volatility in early 2000. "It's a difficult environment. Day to day stock movements make no sense at all."
He thinks a breakup is excessive and that the U.S. Supreme Court will likely reverse the decision by U.S. District Judge Thomas Penfield Jackson to divide Microsoft into two smaller companies.
Lindsey also thinks the worst of Microsoft's legal problems are behind it - and that it has potential to reverse its losses. The fund has recently been buying the stock and he thinks the company is going into a period of "accelerated growth." Microsoft recently moved back into the top 10.
His advice for investors is to try and ignore the volatility.
"People shouldn't try to time the market," Lindsey said. "Strategists on Wall Street are way more wrong than they are right."
What the experts say
Kelli Stebel, editorial analyst at Morningstar, said she thinks highly of the managers at Putnam.
"They have an extensive team and a lot of analysts who assist the portfolio managers," Stebel said. "They have such a comprehensive staff that they can do a lot of good work."
Both Growth Opportunities and New Opportunities are aggressive funds that would work well in a long-term portfolio. But investors should be prepared for volatility in the short term.
"You should have a long time horizon," Stebel said. "This isn't for somebody who needs the money in a month." 
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