By Heidi Brown | Forbes | 12.08.2003
Finding opportunity in debt is easy, say the guys at Dalton Investments. All you have to do is travel the globe.
Steven Persky and James Rosenwald clearly didn’t spend much time coming up with the name of their hedge fund firm. They named their company, founded in 1998, after the exclusive private school they attended together in New York City: the Dalton School.
Yet the little firm with the so-so name says it is generating pretty spectacular returns–not through imagination but via relentless research and analysis. Its flagship fund, Dalton Global Opportunity, has returned 15.7% per year since its 1999 inception. For the last 12 months investors have enjoyed a 40% return. By using careful, bottom-up research with a priority on cash generation and asset value, Persky has developed a way to invest safely in risky bonds around the world, including some of its less-developed corners. “I can’t expect the courts in emerging-market countries to protect me,” says Persky, “so I have to find companies that have a compelling reason to pay me back.”