David Tillson is the anti-tax man. The manager of New York-based U.S. Trust Corp.'s Master Equity Fund works hard to protect his clients from having to pay unnecessary taxes on premature profits. While another fund manager might sell a stock because it's not climbing fast enough, Mr. Tillson, 47, is more willing to sit tight, particularly if he sees real potential down the road. Otherwise, his fund's investors would pay a 28% capital gains tax and would be left with 28% less principal to invest in the next stock. We're paying attention to what the individual shareholder is looking at also, he said. We'll take gains when necessary, but we don't want to take unnecessary gains. While he's only been in charge of the portfolio for a year, that kind of long-term philosophy has worked well for the 10-year-old fund. With assets under management of $170 million, UST Master Equity is the top bank-managed growth fund for the last five years, with a 19.6% annualized return for the period, according to Lipper Analytical Services, Summit, N.J.

This fund as I see it is designed more or less to mirror what a typical account at U.S. Trust should look like, Mr. Tillson said. We're managing this with the same idea as a taxable account would be managed here. In general, the Equity Fund, part of the $4 billion-asset UST Master Funds family and distributed by Federated Services Co., Pittsburgh, seeks companies that are mispriced and in out-of-favor industries. That's because those are the stocks with most room for growth, he said. I view the management of this fund kind of like planting a garden, said Mr. Tillson, who often puts in 12-hour days, plus some time on weekends, to weed out the stocks he doesn't want.

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