Howard Marks (investor)
Howard Marks | |
|---|---|
| Born | 1946 Queens, New York, U.S. |
| Occupation(s) | Investor, author |
| Known for | Co-founder and co-chairman of Oaktree Capital Management |
| Notable work | The Most Important Thing: Uncommon Sense for the Thoughtful Investor; The Most Important Thing Illuminated: Uncommon Sense for the Thoughtful Investor; Mastering the Market Cycle: Getting the Odds on Your Side |
Howard Stanley Marks (born 1946) is a prominent American investor and author, recognized as the co-founder and co-chairman of Oaktree Capital Management, the world’s leading investor in distressed securities. As of 2022, Marks possessed a net worth of $2.2 billion, placing him at No. 1365 on the Forbes list of billionaires.
Marks is well-known for his investment writings, commonly referred to as "memos," which provide deep analysis on market strategies and economic trends; these are accessible to the public via Oaktree’s website. He has also written three investment-focused books. Warren Buffett has commended Marks’s memos and publications for their insightful guidance.
His investment philosophy prioritizes risk management customized to the investor’s unique situation, urging individuals to evaluate whether their greater concern is losing capital or missing out on gains. Marks contends that true competitive advantage stems less from conducting research—since many experts already do so—and more from interpreting the significance of company data, managing behavioral biases in investing, and understanding where the economy stands within the business cycle. His goal is to achieve consistent returns during rising markets while limiting losses during downturns, emphasizing that losses have a more detrimental impact than equivalent gains provide benefits. Marks advocates for tactical market timing, holding cash reserves to capitalize on opportunities during market declines.
He highlights the necessity of embracing uncertainty rather than assuming predictability and values steady performance ("high batting average") over infrequent large successes ("home runs").
The funds under Marks’s management have generated long-term net annual returns averaging 19%, primarily catering to institutional clients such as pension funds and sovereign wealth funds.
Early life and education
Born in 1946 and raised in Queens, New York, Marks grew up in a family of ethnically Jewish heritage but was brought up practicing Christian Science. He pursued his undergraduate education at the Wharton School of the University of Pennsylvania, where he was affiliated with the Pi Kappa Alpha fraternity. Graduating cum laude in 1967, he majored in finance with a minor concentration in Japanese Studies. At age 23, in 1969, he earned an MBA specializing in Accounting and Marketing from the University of Chicago Booth School of Business, receiving the George Hay Brown Prize for his academic excellence. Marks achieved the designation of CFA charterholder in 1975.
Citicorp
Marks’s career at Citicorp spanned from 1969 to 1978, beginning as an equity research analyst before advancing to Director of Research. From 1978 until 1985, he held roles as vice president and senior portfolio manager with responsibility for convertible securities and high-yield debt. In 1980, he relocated to Los Angeles under Citibank’s approval to oversee a high-yield fund. During this period, he encountered Michael Milken in 1979 and regarded Milken’s business model as a significant example worthy of study by Harvard Business School.
TCW Group
Joining TCW Group in 1985, Marks took charge of investments in both high-yield debt and convertible securities. In 1988, together with Bruce Karsh, he launched one of the earliest distressed debt funds within a major financial institution. By 1995, Marks, Karsh, and three additional colleagues sought to exit TCW to establish their own firm while continuing to manage TCW funds under a fee-sharing arrangement. When TCW rejected this proposal, all five partners left to create Oaktree Capital Management based in Los Angeles.
Oaktree
Established in 1995, Oaktree swiftly grew its expertise in high-yield debt, distressed debt, and private equity investments. Amid the 2008 financial crisis, the firm raised $10.9 billion—the largest fund dedicated to distressed debt at that time—to purchase troubled assets, delivering substantial returns for its investors.
Oaktree launched its initial public offering on the New York Stock Exchange in April 2012, generating $380 million by offering 8.84 million shares priced at $43 each. In March 2019, Brookfield Asset Management acquired a controlling 62% interest in Oaktree, while founder Howard Marks and his partners maintained a 38% stake along with full operational control.
Organizations
Between 2000 and 2010, Marks served as chair of The University of Pennsylvania's Trustees' Investment Board. Additionally, he holds trustee positions and chairs the Investment Committees at both the Metropolitan Museum of Art and London's Royal Drawing School.
Personal life
Marks is a father to two children: Andrew, his son with second wife Nancy (née Freeman), and Jane Hait, Nancy’s daughter from a prior marriage. Andrew is a General Partner at venture capital firm TQ Ventures, whereas Jane is the Founder and Chairperson of the non-profit Center for Art, Research and Alliances.
Philanthropy
In 1992, Marks created the Howard S. Marks Terms Scholarship at the University of Pennsylvania and later funded the Marks Family Writing Center in 2009. In March 2023, Nancy and Howard Marks gifted $5 million to UCLA to establish an endowed faculty chair in women’s health research at the David Geffen School of Medicine, supporting leadership in women's health initiatives.
Residences
Marks purchased an oceanfront estate in East Hampton for $30 million in 2010. In May 2012, he and his wife acquired a duplex at 740 Park Avenue for $52.5 million. He sold his Malibu residence in 2013 for $75 million. In 2015, Marks bought a home in Beverly Hills for $23.7 million and expanded his property portfolio there in 2017 by acquiring the neighboring lot for $9.7 million. In 2019, he further expanded near his East Hampton estate by purchasing land parcels in Amagansett, New York valued at $35 million.
Political affiliation
A member of the Democratic Party, Marks has voiced criticism of the economic policy of Donald Trump. In 2016, he contributed more than $200,000 to the Hillary Victory Fund and affiliated groups. Nevertheless, he expressed opposition to Representative Alexandria Ocasio-Cortez’s tax proposal, emphasizing that much of America’s economic advancement is driven by individuals striving to enhance their circumstances.
Books
- 2011: The Most Important Thing: Uncommon Sense for the Thoughtful Investor
- 2012: The Most Important Thing Illuminated: Uncommon Sense for the Thoughtful Investor
- 2018: Mastering the Market Cycle: Getting the Odds on Your Side