Fortescue: A Lesson in Volatility for Value Investors

Rupert Hargreaves

Published onMay 24, 2016

Updated on May 13, 2021

Guest post: Fortescue -- A Lesson in Volatility for Value Investors by Jonathan Rochford, CFA Portfolio Manager of Narrow Road Capital Pty Ltd

When I started Narrow Road Capital in 2012 many people would question why an Australian credit manager was so negative about lending to commodity-linked companies. Australia has a plethora of miners so why wouldn’t I want to lend to at least some of those? The journey that Fortescue has been on highlights why volatile businesses are generally not good credit investments, even when they might be great equity investments.

Fortescue: Unpredictable

Over the last year, the iron ore price has traded in a band of US$37 to US$70. The recent spike is thought to be in part due to speculation...

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Rupert Hargreaves

Sign up now and get our in-depth FREE e-books on famous investors like Klarman, Dalio, Schloss, Munger Rupert is a committed value investor and regularly writes and invests following the principles set out by Benjamin Graham. He is the editor and co-owner of Hidden Value Stocks, a quarterly investment newsletter aimed at institutional investors. Rupert owns shares in Berkshire Hathaway. Rupert holds qualifications from the Chartered Institute For Securities & Investment and the CFA Society of the UK. Rupert covers everything value investing for Hedge Fund Alpha

Fortescue: A Lesson in Volatility for Value Investors

Fortescue: Unpredictable

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