Investing Wisdom series 2: Distressed checklist – Howard Marks (Oaktree Capital) [2mins]

Howard Marks

Howard Stanley Marks is an American investor and writer. After working in senior positions at Citibank early in his career, Marks joined TCW in 1985 and created and led the High Yield, Convertible Securities and Distressed Debt groups. In 1995, he left TCW and co-founded Oaktree Capital Management. In the 2017 Forbes rankings of the wealthiest Americans, Marks was ranked the #374 richest person in the United States, with a net worth of ~$1.91 billion.

Key points to remember when evaluating a distressed investment opportunity:

  • What is the pie worth?
  • How will it be split up among claimants?
  • How long will it take?
  • It is never over – the cycle continues; investors must understand the cyclical nature of markets and the economy
  • No good or bad investments – Just bad timing and bad prices
  • Shortness of memory is an amazing feature of financial market

Read Howard Mark’s original Memos right from 1990s (true wisdom, a must read for all value investing students) – Click

Earlier Posts (In case you have missed):

Howard Mark’s thoughts on RISK [3 mins]

Sir John Marks Templeton’s rules of Investing [2 mins]

Charlie Munger – 25 Cognitive Biases [10 mins]

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