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Bram de Haas
Bram de Haas
Articles (308)  | Author's Website |

John Rogers of Ariel Investments Doesn't Fear the Next Crisis

Rogers appeared on Bloomberg and talked about the next crisis, current holdings and his success formula

October 01, 2018 | About:

John Rogers (Trades, Portfolio) of Ariel Investments appeared on Bloomberg on Sept. 28. Ariel and Rogers have been known to be savvy value investors for a long time but according to Bloomberg, Ariel outperformed most peers since 2009.

Asked how they did it, Rogers responded that they try to stay within their circle of competence. They buy companies where they believe in management. Their grizzled analyst teams did a lot of homework to deliver these returns. 

Because Ariel has a reputation as a long-term investor, the team gets called back fast. People like to have them as investors and apparently give the firm a lot of access because they want them on board.

Next crisis

Rogers represents something of a different sound in investing as he isn't as concerned about the next crisis. He contended that the next crisis will not be nearly as severe as the last one. Rogers is on a lot of investment commitees. There are three main arguments he put forward as to why the next crisis won't be so bad:

  • People are very cautious not to make the same mistakes as in the last crisis.
  • Most public companies have been really reasonable with their debt.
  • Private equity sets a floor. They raised so much money they will be able to come in and buy when there is a downturn.

Investments they like

Ariel loves many of the financial services firms, especially with fee-based business models. They like firms like Lazard (NYSE:LAZ) with its investment banking arm. They also like KKR (NYSE:KKR), which is a top-four private equity manager. Pension funds and investment endowments are investing in KKR and private equity in general to try to generate returns.

The table below shows the top holdings GuruFocus identifies for John Rogers (Trades, Portfolio) and Ariel Investments with the Chinese search engine Baidu (NASDAQ:BIDU) being the largest position and Microsoft (NASDAQ:MSFT) in second place.

Disclosure: no positions.

About the author:

Bram de Haas
Bram de Haas is the managing editor of The Black Swan Portfolio.

Visit Bram de Haas's Website

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