Will Danoff: ‘Be Very Careful of Unprofitable Companies’

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**SPEAKER_2** (0:27)
Please stay tuned for important disclosure information at the conclusion of this episode.

**Amy Arnott** (0:33)
Hi and welcome to The Long View. I'm Amy Arnott, Portfolio Strategist for Morningstar. We're taping this podcast live at the Morningstar Investment Conference, where we're delighted to be joined by Fidelity's Will Danoff. Will runs a number of Fidelity Equity Strategies, the best known of which is Fidelity Contrafund, a mutual fund he has been managing since September 1990
Morningstar named Will its Domestic Stock Manager of the Year in 2007 Prior to becoming a Portfolio Manager, Will served as a Retail Analyst at Fidelity and Assistant Portfolio Manager at Fidelity Magellan. He graduated from Harvard University and earned his MBA at the Wharton School of the University of Pennsylvania.
Will, welcome back to The Long View.

**Will Danoff** (1:19)
Great to be here, Amy. Really, a real pleasure.

**Amy Arnott** (1:23)
Well, thank you for joining us. We wanted to start by talking a bit about your origins and career path. So if we rewind all the way back 40 years ago, can you tell us a bit about how you first got interested in investing and who some of your early mentors and experiences were?

**Will Danoff** (1:44)
Yeah. I feel so lucky that I did end up at Fidelity. I mean, whatever, it's been 40 years. It's been a remarkable run. We got a great team. You mentioned the Magellan, Fond Peter Lynch, just an exceptional individual. But I guess I was always interested in games. I like to play games. I used to play poker with my friends and played chess and backgammon. So I don't know, the stock market in a way is a big game. So I was interested and then family friend had done well.
And again, my father's a doctor, my mother's a kindergarten teacher. So I didn't really have much experience in business or in the market. But this one friend retired when, I don't know, I think he was in his 40s. And I don't know, somehow it was intriguing to me. So I ended up not liking doctoring as much as I thought. I volunteered at a hospital and I just didn't feel the calling. So ended up becoming a stock picker. And I will say I worked on Wall Street for a couple of years before business school, Amy, and the people there were just having fun. It was very dynamic. These were men and women in their 40s. And they were just high-fiving. And it was in the early 80s. The market was going up. But I think I just liked the dynamic aspect of the market. And so luckily Fidelity hired me and they really trained me, gave me an opportunity to learn about the retail industry, which was really helpful. But before I forget, we have to look back and see if since 2007 when you gave me that great award, if the fund has done well, I think it has. So maybe Robbie will do the research before the keynote today. But it's a great team and I'm just grateful to Fidelity. I'm also grateful to so many of the shareholders and Morningstar for believing in me and being patient as you know, the markets go up and down and it's a streaky business, but the shareholders have been for the most part, patient and then when you look back, it's this notion of like other respects for the companies and the management teams, who have worked so hard to build new businesses or work hard to make an existing business that much better.
There's just so much that goes into delighting customers, delighting employees and out of that comes the delight for the shareholders. But I got dinged at Fidelity in the summer internship coming out of Wharton. So I was immature and I can see in hindsight why I didn't make the cut. But for all your listeners, don't give up.
One of the fellows who was graduating one year ahead of me at Wharton, I had discovered at a party that he worked at Fidelity. I was just like, I have to meet this gentleman, Steve Kay, who runs the, we did the healthcare stocks and then ended up, I think, running Growth and Income. He did a great job, great investor. He's still at Fidelity. This is before email and everything. So I literally wrote him a handwritten note. We all have little folders. And I said, I need to meet you. Inter-office mail? Yeah, right. Exactly.