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By Christopher Davis | 11-30-2009 12:15 PM

Rooting Out Value Across the Capital Structure

Manager of the Decade nominee Steve Romick of FPA Crescent on the fund's debt investments amid the crisis and finding opportunity in energy and health-care names today.

Christopher Davis: Hello, I'm Christopher Davis with Morningstar.com. Today I'm with Steven Romick, the manager of FPA Crescent Fund. Crescent Fund is a terrific fund; it has a great long-term record. And Steve is actually a nominee for the Fund Manager of the Decade award, which we'll be announcing later on, I believe in January. Steve, welcome. Thanks for joining me.

Steve Romick: Thank you.

Davis: Steve, you have a really unique strategy among mutual fund managers. Most mutual fund managers stick with a box in the style box. They stick with one asset class. But you do neither. Could you just briefly sum up what you're trying to accomplish and how you do it?

Romick: I guess we don't like the cages. We are like free range chickens, I guess. Our goal is to generate equity rates of return with less risk than the market over time. And we try and do that by investing across the capital structure of a company. So the common stocks, preferred stocks, convertible bonds, junior debt, senior debt, bank debt of a company, and in different asset classes, as well.

So we're really looking across the full range and spectrum in order to try and provide those equity rates of return, and trying to be agnostic along the way as to industry group and asset class.

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