Howard Marks, the chairman of the investment firm Oaktree Capital Management, says that “the most attractive assets classes now are the ones that the retail investor really doesn’t have access to”, in an exclusive interview with CCTV News. He suggests that the so-called private strategies are cheaper and more attractive than public strategies, which “have been driven up in price”. To be more detailed, Howard Marks pinpoints that real estate, infrastructure, and control investing “are more attractive than public stocks and bonds“. However, a typical investor does not have the expertise of the chairman of the world’s biggest distressed-debt investor, which makes it close to impossible to exploit the existing opportunities in the aforementioned asset classes.
Oaktree Capital Management is a global alternative investment management firm that primarily focuses on credit strategies. The investment firm was established back in 1995 by a group of individuals, including Howard Marks, who had previously been investing in high yield bonds, convertible securities, distressed debt, real estate, and control investments. As stated by the firm’s latest 13F filing with the SEC, Oaktree Capital oversees a public equity portfolio with a market value of $8.63 billion as of June 30. We will discuss the firm’s top holdings later on in this article.
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Howard Marks, who is also widely-known for his investor memos, also asserted that most asset classes are now more attractive as the recent volatility has reduced their prices. Unlike most people who become more interested in specific asset classes or securities in particular when prices go up, Oaktree’s chairman implies that his investment firm may become more interested in the recently-hit public asset classes. Furthermore, Marks does not consider himself a Fed-watcher, claiming that “the important thing is that interest rates will rise”, whereas the timing of a potential rate hike is completely irrelevant.
Let’s now take a closer look at Howard Marks’ highly-regarded investor memos. His most recent memo, dated September 9, suggested that the high volatility and correction that occurred in August was a result of investors surrendering to their own anxiety. Specifically, Marks outlined in the memo that “emotion is one of the investor’s greatest enemies”. He also pinpointed that “something about which I feel strongly is that it’s not the things you buy and sell that make you money; it’s the things you hold”. Having said that, we will now take a quick look at Howard Marks’ top stock picks at the end of the June quarter.
Even though Oaktree Capital Management decreased its stake in STORE Capital Corp (NYSE:STOR) by 12% during the second quarter, the stock still represents the firm’s largest holding. To be more specific, the investment firm owns 74.44 million shares of STORE Capital, which account for 16.86% of the value of its portfolio. Furthermore, Tribune Media Co (NYSE:TRCO) is Marks’ second-largest holding, consisting of 14.15 million shares. However, it’s worth noting that Oaktree Capital decreased its stake in Tribune Media by approximately 25% over the period. Finally, Howard Marks’ investment firm reported owning 113.14 million shares of Star Bulk Carriers Corp (NASDAQ:SBLK) valued at $332.62 million as of June 30, making it the third-largest holding in Marks’ portfolio.
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