Marks: Strong assets more important than hedging forex risk

Paying excessive attention to currency movements is futile, according to Marks, because the volatility of the forex markets makes it hard to make predictions about the future.

"Steering your investments into countries and regions based on how you think they're going to do economy-wise is going to be less efficacious for us micro experts than just trying to get the best performing assets at the best prices in the world," he said. "Nobody in my opinion has the answer to the macro questions, nobody can see the future."

Most of Oaktree's LPs are based in the US, as are most of the company's investments, although an increasing number are located in Europe. Some of its investors do choose to hedge their forex risk, but many don't. "We think mostly in dollars," Marks said. "And even if we hedge back into dollars, we have investors who are neither in Europe nor the US. We can't hedge for everybody into the currency they want, because everybody would probably want a different currency."

When asked about the topic of job creation, he predicted that unemployment levels will rise still further in the developed world over the next decade. One of the reasons for thisis that semi-skilled and lower-skilled roles in areas such as manufacturing continue to move to emerging markets, leaving workers in the US without employment.

Another factor is that "if you're in an information age, then you'll probably need even fewer people to provide all the information you need than you do to provide all the cars you need. If you can make more with less labour, it bodes ill for people to find jobs."

The Investment Summit formed part of the 24th annual AVCJ Forum, which took place from November 7th-10th in Hong Kong. For more information, go to www.avcjforum.com.

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