Shifting Gears
American International Group Inc., the New York-based insurer that's Berkowitz's largest holding, lost 40 percent this year, according to data compiled by Bloomberg. Goldman Sachs Group Inc. fell 19 percent.
Heebner, manager of the $2.5 billion CGM Focus Fund, didn't fare better, losing 12 percent through June 9, second-worst among large funds, according to Morningstar. His fund had 36 percent in auto stocks at the end of 2010, according to a regulatory filing.
Heebner, 70, is known for making concentrated bets in industries from homebuilding to commodities and for his willingness to shift gears quickly. CGM Focus Fund, which gained 80 percent in 2007, returned 12 percent a year for the past 10 years, better than 99 percent of rivals.
"We anticipate a better domestic economic environment in the year ahead," Heebner wrote in a Jan. 3 letter in the fund's annual report.
Signs Of Slowdown
Those expectations were damped when the U.S. economy slowed to a 1.8 percent annual rate of growth in the first quarter, from 3.1 percent gain in the final three months of 2010.
More recent reports suggests the world's largest economy is slowing further. Manufacturing grew at its slowest pace in more than a year in May, consumer spending rose less than forecast in April, and the unemployment rate unexpectedly climbed to 9.1 percent in May.
Heebner declined to comment, Martha Maguire, a spokeswoman, wrote in an e-mail.
Ford Motor Co., based in Dearborn, Michigan, and Heebner's largest holding at yearend, fell 11 percent in the first quarter. His third-largest position, Freeport-McMoRan Copper & Gold Inc., fell 7.1 percent. Freeport, the world's largest publicly traded copper producer, is based in Phoenix.
Selling Ford