Nice article on Howard Marks with a thoughtful quote included: "There’s no such thing as a bad asset. It’s a question of pricing."
Here it is:
Howard Marks was failing miserably. It was 1977, and the research group he oversaw at Citibank (C, Financial) had recommended Nifty 50 stocks that lost 90 percent of their value over the previous decade.
Then Peter Vermilye, Citibank’s chief investment officer, gave Marks an option: He could quit research and start a fund focusing on convertible bonds, a niche where neither the New York bank nor Marks had any experience. He jumped at the chance.
“It changed my life,” says Marks, who with his light-brown tortoiseshell glasses and spiky, sandy-colored hair looks younger than his 65 years. “If he hadn’t pushed me out of the research job, where would I be today?”
Marks is now chairman of Oaktree Capital Management LP, the biggest distressed-debt investor in the world, Bloomberg Markets magazine reports in its August issue. Oaktree oversees $85.4 billion for pension funds from Massachusetts to Florida and the world’s biggest sovereign-wealth funds, such as China Investment Corp. Oaktree’s 17 distressed-debt funds have averaged annual gains of 19 percent after fees for the past 22 years — about 7 percentage points better than its peers tracked by Boston-based consulting firm Cambridge Associates LLC.
"Most Important Thing"
Oaktree is likely to get even more prominent if it goes ahead with a plan to list shares on the New York Stock Exchange, perhaps as early as this summer. In May 2007, Oaktree raised about $1 billion, selling a 15 percent stake on a private Goldman Sachs Group Inc. exchange open to sophisticated investors. The transaction valued the whole company at $6.3 billion.
Marks has come so far from his days at Citibank that he’s now selling his investing philosophy in a book, The Most Important Thing, which was published in May by Columbia University Press. In an interview in his downtown Los Angeles office, from which he has a view of the iconic Hollywood sign, Marks says his strategy is to find bargains such as troubled media company Tribune Co., movie theater chain Regal Entertainment Group (RGC, Financial) and CIT Group Inc. (CIT, Financial), the small-business lender that emerged from bankruptcy in 2009.
“We don’t expect to be able to hit the bottom,” Marks says. “All we care about is that we’re buying cheap. If it gets cheaper, we buy more. Eventually, it’ll work out — so long as we are right.”
For entire article:
http://www.bloomberg.com/news/2011-06-17/biggest-distressed-debt-investor-marks-europe-after-22-years-of-19-return.html
Here it is:
Howard Marks was failing miserably. It was 1977, and the research group he oversaw at Citibank (C, Financial) had recommended Nifty 50 stocks that lost 90 percent of their value over the previous decade.
Then Peter Vermilye, Citibank’s chief investment officer, gave Marks an option: He could quit research and start a fund focusing on convertible bonds, a niche where neither the New York bank nor Marks had any experience. He jumped at the chance.
“It changed my life,” says Marks, who with his light-brown tortoiseshell glasses and spiky, sandy-colored hair looks younger than his 65 years. “If he hadn’t pushed me out of the research job, where would I be today?”
Marks is now chairman of Oaktree Capital Management LP, the biggest distressed-debt investor in the world, Bloomberg Markets magazine reports in its August issue. Oaktree oversees $85.4 billion for pension funds from Massachusetts to Florida and the world’s biggest sovereign-wealth funds, such as China Investment Corp. Oaktree’s 17 distressed-debt funds have averaged annual gains of 19 percent after fees for the past 22 years — about 7 percentage points better than its peers tracked by Boston-based consulting firm Cambridge Associates LLC.
"Most Important Thing"
Oaktree is likely to get even more prominent if it goes ahead with a plan to list shares on the New York Stock Exchange, perhaps as early as this summer. In May 2007, Oaktree raised about $1 billion, selling a 15 percent stake on a private Goldman Sachs Group Inc. exchange open to sophisticated investors. The transaction valued the whole company at $6.3 billion.
Marks has come so far from his days at Citibank that he’s now selling his investing philosophy in a book, The Most Important Thing, which was published in May by Columbia University Press. In an interview in his downtown Los Angeles office, from which he has a view of the iconic Hollywood sign, Marks says his strategy is to find bargains such as troubled media company Tribune Co., movie theater chain Regal Entertainment Group (RGC, Financial) and CIT Group Inc. (CIT, Financial), the small-business lender that emerged from bankruptcy in 2009.
“We don’t expect to be able to hit the bottom,” Marks says. “All we care about is that we’re buying cheap. If it gets cheaper, we buy more. Eventually, it’ll work out — so long as we are right.”
For entire article:
http://www.bloomberg.com/news/2011-06-17/biggest-distressed-debt-investor-marks-europe-after-22-years-of-19-return.html
