“ ‘Unemployment is low; inflation is low; valuations have compressed 15 to 20 percent this year because earnings are up and stock prices aren’t. I think this is a normal correction in an ongoing bull market. Until something changes at the macro level and with valuations, we’re fully invested.’ ”

That’s how Bill Miller, a Wall Street legend who earned his status by guiding his fund at Legg Mason to 15 years of beating the S&P 500 SPX, -1.11% , currently views the state of the stock market.

By we, Miller is talking about his Baltimore-based firm Miller Value Partners, where he manages about $2 billion with his two sons.

When he was at Legg Mason US:LM , Miller managed $70 billion in assets. But that was before the financial crisis hit and completely ravaged his fund, which was top-heavy with financial stocks like Citigroup C, -1.47% and... Bear Stearns.

His current fund is performing well, having outperformed the S&P over the past decade by about 3 percentage points annually, according to Morningstar data. Investors are taking notice, with some $377 million flowing into Miller Opportunity Trust LMOPX, -1.10% last year.

“This is the only time in my 37 years of managing money that we’ve seen inflows despite a market correction,” Miller told Institutional Investor.

He went on to name four of his favorite stocks at the moment: Facebook FB, -0.89% , ADT ADT, -4.90% , Avon US:AVP and Amazon AMZN, -1.78% , his fund’s biggest holding.

“People missed Amazon because they said it doesn’t make money,” he said. “I don’t let the price of a company’s stock confuse me about a company’s fundamentals. That’s rarely the end of the story.”