Tuesday, November 8, 2011

Howard Marks on skill-based value added

Howard Marks quote from July 2002, but probably just as valid in today’s environment (I also posted this last night on Twitter):

“More than ever, I think non-market-derived, skill-based value added – that is, alpha, not beta – will hold the key to investment performance. Because owners of capital may not be able to count on a tailwind like we enjoyed in the 1980s and 1990s, managers with great skill remain the strongest hope. And in this climate, I'd rather bet on risk control than risk bearing as the route to superior results.” –Howard Marks