![]() ![]() These two events had a strong influence on me and helped define my – and what five years later became Oaktree’s – investment philosophy, which emphasizes risk control and consistency above all. It turns out that most investors aiming for top-decile performance eventually shoot themselves in the foot, but Dave never did.Īround the same time, a prominent value investing firm reported terrible results, causing its president to issue an easy rationalization: “If you want to be in the top 5% of money managers, you have to be willing to be in the bottom 5%, too.” My reaction was immediate: “My clients don’t care whether I’m in the top 5% in any single year, and they (and I) have absolutely no interest in me ever being in the bottom 5%.” And where did those solidly second-quartile annual returns place the fund for the 14 years overall? Fourth percentile! I was wowed. Dave told me that, in his 14 years in the job, the fund’s equity return had never ranked above the 27th percentile of the pension fund universe or below the 47th percentile. One was a dinner in Minneapolis with David VanBenschoten, who was the head of the General Mills pension fund. My memos got their start in October 1990, inspired by an interesting juxtaposition between two events. Howard Marks, Oaktree Capital Management co-chairman ![]()
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