Fidelity's Puritan and Equity Income II are two of the largest mutual funds in America.
Believe it or not, one person manages the stocks in both funds.
Meet Bettina Doulton, picker of $38 billion worth of stocks and part of an elite tier of money managers nationwide. Only two Fidelity managers handle more money: Robert Stansky of the $54 billion Magellan Fund and George Vanderheiden, who steers six funds.
Ms. Doulton, schooled partly by the legendary Magellan Fund chief Peter Lynch, takes the task in stride.
"I come in every day and do my best," she says, and that means 6:30 a.m. to 6 p.m. weekdays, and Saturday and Sunday afternoons.
So far, her best has been fine.
"She seems to be an exceptionally good stock picker," says Jack Bowers, editor of Fidelity Monitor, a newsletter on Fidelity funds.
Her eye for value saved shareholders from losses in the first quarter of 1997.
The Puritan Fund, which she has managed for a year, was up 1.48 percent as stock and bond funds generally fell.
Puritan, a $19 billion balanced fund, holds 60 percent stocks and 40 percent bonds.
Equity Income II, a $15 billion fund that Doulton took charge of more recently, was up 0.18 percent.
Both funds are among the 20 biggest in the industry.
Equity Income II invests mostly in the stocks of big companies that pay regular dividends. Mr. Bowers says Doulton is still adjusting the portfolio to suit her style.
The fund came her way when Brian Posner, another rising star at Fidelity, left its helm to take a job at another firm.
More than a dozen Fidelity managers have left the world's largest mutual fund firm in the past year, causing concern among some of the 10 million investors owning shares of Fidelity funds.
"It raised questions for investors," admits Doulton. In Boston and San Francisco, she joined a Fidelity "road show" for investors that traveled to six cities across the United States to assure shareholders that Fidelity was still on course.
"We lost talented people last year," she says. "But the feeding system [for training new managers from the bottom up] is working the way it should."
But this year, providing good returns for shareholders has proved difficult.
"We seem to be in one of those periods where perceptions of the economy and of inflation are bearish," Doulton says. "We have done this a couple of times in the last couple of years."
Still, with baby boomers and the next generation investing for retirement, Doulton concludes: "Over time I am optimistic on the market."
When Doulton took over Puritan, she revamped the portfolio, replacing virtually every stock chosen by her predecessor. She emphasized companies with above-average dividends, and she raised the average capitalization, or size, of the companies in the portfolio.
She put more weight on financial companies, consumer nondurables (including health-care stocks), and energy stocks. She put less weight on basic industries, utilities, and foreign stocks.
Puritan's stocks narrowly beat the Standard & Poor's 500 index in her first 11 months as manager.
As is normal with conservative funds, Doulton looks for value - stocks not overly inflated in price.
She also searches for a catalyst, say a cyclical recovery or a new product, that will lift the company's stock.
Doulton joined Fidelity after graduating in 1986 from Boston College with a math degree. She moved rapidly through Fidelity's training system.
She first worked as an equity analyst of companies in specific industries. For a few years, she was a research assistant for Mr. Lynch. "I learned a lot from Peter," she says, including a "good work ethic."
Like Lynch, she has "a knack for analyzing financial companies," Bowers says.
Doulton got her start as a money manager overseeing a Fidelity sector fund, the Select Automotive Portfolio, in 1993. Now, besides Puritan and Equity Income II, she manages Fidelity's Advisor Balanced and VIP III Balanced funds.
In an industry dominated by males, does being a woman make for any special challenges as an investment manager?
"No," Doulton says. "My stocks don't care whether I am male or female."
The qualities that make for success, she says, include a competitive spirit, independent thought, diligence, a bit of cynicism (not accepting at face value the claims of corporate management), and not too much arrogance.
Each day she reads research reports on companies, diverted by a computer screen that carries current stock quotes. It sits on a paper-crowded desk in a cluttered, small office.
A big chunk of her time goes to visits with executives from corporations, typically 10 to 15 per day. Fidelity, with about $500 billion in assets under management, has sizable clout. So top executives make time to call at its downtown Boston headquarters to tell their story.
"I need to know the inside and out of a company to decide whether to bet shareholders' money on it," she says.
How are the 'kids' doing?
Every day, she says, she watches prices to see which "kids" in the portfolio are good, and which are bad. If she decides a stock is really bad, she knows how long it will take Fidelity's trading desk to sell it without seriously depressing the price in the market.
Because of the conservative nature of the funds she manages, they offer "a bit more downside protection [than most] in a down market," Doulton says.
But if her stocks are down at the end of the day, she goes home unhappy. Even when the whole market is down, "I don't like losing my shareholders' money."