Today in 1994: Garzarelli Fund Closed

via Jason Zweig:

1994: Remember Elaine Garzarelli, the “guru” at Shearson Lehman Brothers who “called” the Crash of 1987? Her Smith Barney Shearson Sector Analysis Fund, which sucked up $700 million in 1987 from investors dazzled by her forecasting ability, is shut down today as Smith Barney quietly merges Garzarelli’s fund into its Strategic Investor Fund. The reason: Right after she called the 1987 crash, Garzarelli’s crystal ball went splat. Her fund lost 13.1% in 1988, lagging the market by a gaping 29.7 percentage points — and in the fund’s six full calendar years of operation, it trailed the Standard & Poor’s 500-stock index by an atrocious 9.6 points annually.

Source: Lipper Inc.; Morningstar Mutual Fund Sourcebook 1994, p. 1208.

Sorry, Virginia, there is no such thing as a crystal ball . . .



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