Financial research firm Morningstar announced today the three winners chosen as “Mutual Fund Managers of the Year.” But with many studies showing one year’s hot managers often don’t perform as well the following year, is it a distinction anyone really wants?

The three fund managers selected this year were: Will Danoff, manager of both the Fidelity Contrafund (FCNTX) and Fidelity Advisor New Insights (FNIAX) in the domestic stock category; Hakan Castegren and the Northern Cross Team, managers of Harbor International (HAINX), in the international equity category; and lastly, Bill Gross and Team, managers of the PIMCO Total Return (PTTDX) and Harbor Bond fund (HABDX).

“When choosing the winners, we look for fund managers who have delivered strong performance both over the long and short-term,” said Christine Benz, director of mutual fund analysis for Morningstar, in a press release. Benz noted that all of the winners are veteran managers with lots of experience who also manage large funds. She added that Bill Gross is the first manager to receive the award three times.

Gross had a relatively rough 2006, lagging many of his fixed-income peers before moving back into the top tier (performance-wise) in 2007. But if history is any guide, managers and/or sectors that are hot today could very well be cool tomorrow. Surely, you are familiar with the ubiquitous investment-literature disclosure, past performance is not a guarantee of future results. And of course, such warnings abound in the financial press: Mark Hulbert, the author of Hulbert’s Financial Digest, a ranking of investing newsletters, warned investors about the dangers of focusing on past performance winners in a story in the New York Times on December 30. In the pages of the same issue of the Times, investment guru Peter Bernstein wrote, “the best lesson from the past is to forget it before it shoves you into trouble—and remember that surprises and ruptures surely lurk ahead.” You can run into the same problem if you try to chase a hot sector: For example, in the third quarter of 2006, health care was the top-performing sector and energy was the worst (+9.8 percent and -2.1 percent, respectively). But by the fourth quarter they had flipped positions, with energy gaining 10.7 percent and healthcare gaining a paltry 1 percent.

That said, Morningstar picks its Manager of the Year winners not only for their standout performance over the course of the year, but for their steady and consistent track records. Danoff, the domestic-equity winner, has run the Contrafund since 1990, and Advisor New Insights fund since its inception in 2003, according to the release. Both are large-growth/large-blend funds with combined assets of roughly $90 billion. According to Morningstar, in the past 10 years Contrafund has returned an annualized 10.9 percent versus 6.2 percent for the S&P 500. And Advisor New Insights has returned an annualized 16.9 percent over the past three years, versus 8.8 percent for the S&P 500. Both funds closed to new investors in 2006, but Advisor New Insights opened again in November 2007. Danoff was a nominee in the domestic-equity category in 2004 but did not win.

The winner of the international category, Castegren, has managed the Harbor International fund since 1987. Admirable attributes of the fund and its managers, according to the release, include an annual turnover rate below 20 percent, and the fact that Castegren has more than $1 million of his own money invested in the fund. In 1996 he was International Stock Manager of the Year. Bill Gross, a legend in fixed-income money management, has managed the Total Return bond fund for 30 years. He trailed many of his peers in 2006—a rarity—but was back up among the best in 2007, partly because his team avoided the sub-prime market. Both funds (PIMCO Total Return and Harbor Bond fund), which Gross has managed since 1987, topped their shared benchmarking index, the Lehman Brothers Aggregate Index, by nearly 2 percent in 2007.