Friday, August 24, 2007

John Hillery on Value Investing

The 6 February 2007 Globe and Mail carried an article on John Hillery, owner and money manager of the Hillery & Associates LP hedge fund. I found the article interesting because of Hillary's strong focus on value investing principles, and how his focus on those principles led to strong returns(11.3-per-cent CAGR over the past five years, vs the average U.S. equity fund, which lost 0.3 per cent). The interesting thing about Hillary is that he accomplished these returns during periods of market downturn. When the S&P 500 lost 13 per cent in 2001, Mr. Hillery made 25.1 per cent. When the S&P lost 23.4 per cent in 2002, Mr. Hillery made 3 per cent.
Hillery is a strict value investor who insists on buying stocks at big discounts to what he believes to be their true worth, and he won't buy just for the sake of keeping his fund's assets from sitting idle in cash.
This article sat in draft in my blog for some time. Long enough for me to witness the end of the prolonged bull run that markets were on as a result of the sub-prime and asset backed commercial paper scares.
So now what? Well, it sure is an interesting time to consider buying opportunities if you've got the free cash lying around.

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