Put in $2000, then purchased:
$500 for APO
$500 for ARES
$500 for BN
$500 for BX
$889.32 for OWL
My portfolio performance finally underperformed a hypothetical SPY-only portfolio by about 93 basis points. It's due to the great underperformance of the alternative asset managers, which are 45% of my portfolio.
Was I wrong? I don't think so. I insisted on the view that the market wrongly punished the high quality business models of the alternative asset managers, which enjoy a great deal of free cash flow despite the market sentiment hurting their fund raising. I also believe the credit performance of their loan portfolios will continue to perform. Some defaults are always expected for a high yield loan portfolio, and the market just being dramatic on any defaults being reported.
In this update, not only did I average down on my positions, especially in OWL, I also initiated a position in Ares Management Corporation (ARES), an alternative asset manager that is a premier global leader in private credit, often ranked as the largest or one of the top private debt fund managers in the world. It is the manager of one of the best externally-managed business development company (BDC), Ares Capital Corporation (NYSE: ARCC). A more detailed writeup can be found here.
Transactions
Recent and upcoming dividend distributions
Portfolio performance snapshot
Total return:
One-year return:
Portfolio IRR (calculation): 15.12%
Approximated IRR for an SPY-only portfolio: 16.05%
Individual holdings:
Breakdown by categories (real-time):
Total returns for individual holdings:
Last prices:
Portfolio holdings conviction
The convictions in the table below reflects my current opinions and will guide the future contribution of additional investment to existing holdings. Stocks not inside the table are stocks with subpar return on equity that will be very unlikely to receive more contributions from new money (there can be exceptions for very cheap stocks).
Conviction in long-term prospects means how much I believe a company would match or outperform the market (e.g. S&P 500) in the long run. Valuation matters so the conviction generally corresponds to the neutral rating of Valuation. It has the following ratings: weak, moderate, strong
Valuation: greatly overvalued, overvalued, slightly overvalued, neutral, slightly undervalued, undervalued, greatly undervalued
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