This is the type of nonsense you read in news media. A gain can only be realized after they close positions. Since they decided to buy financial stocks and probably invested billions, they are the ones who mostly rallied these stocks. There is nothing mystical about that. Stocks don't go up by themselves. Now, they feed the news media with their story to pump the stocks a bit more so they can sell and record the gains. If other investors do not buy the story, they will end up with a loss. Porbably, they will end up with a loss this time around. Credit crisis isn't over yet. Bill
The may yet prove to have called the bottom, but the time for a big fund to start buying and the actual bottom may not be the same as a fund of that size has to buy when there is still liquidity i.e. generally too early. The fund is high profile enough and has the investor profile that they can withstand the drawdown from early buying. People called the bottom of the NASDAQ all the way down. It seems the specialist distressed players are still sitting on their hands. As for banks being as defensive as bonds, at the bottom of a severe crisis they are basically a bond portfolio as they won't lend and only put their money in Treasuries. Makes them uninteresting to buy desite low valuations because the valuations reflect the assets held which give the yield on Treasuries and no growth.
The financial sector's earnings going forward will be crippled by their writeoffs and by stricter regulatory scrutiny. A recession won't help either.
Magellan has about 300 or so companies to choose from, due to their mammoth size. I love being a small guy-there's better opportunity out there.