A mere three years after graduating from Princeton, John Rogers launched Ariel Investments in 1983, making it the oldest Black-owned investment firm in the United States, with $16 billion in mostly mutual funds and separately managed accounts, according to a profile on Rogers in Forbes. The firm’s flagship Ariel Fund, which Rogers manages, has had massive ups-and-downs over the years, outperforming after the crash of 1987 and the dot-com bust in 2000, losing 48% during the 2008 financial crisis, and falling 19% last year. The fund is weighted towards media and entertainment—two sectors which underperformed in 2022—and is light on the energy stocks that won big last year. But the start of 2023 has been a good one for Ariel, with the fund up 14% in January.
Rogers takes a high-concentration approach to investing; his top 10 holdings make up 39% of the fund. Currently, the fund’s biggest holding is Madison Square Garden Entertainment, a sector that Rogers particularly likes as he believes those types of performance venues not only have staying power but are also undervalued by Wall Street. Paramount Global is another large holding that Rogers thinks is underestimated as investors focus their attention on more high-profile streaming services. Beyond entertainment, financial-services stocks such as Lazard, The Carlyle Group, and KKR are some of the bigger holdings in the fund that have done well. Meanwhile, Rogers is wagering on the housing sector, taking up stakes in Mohawk Industries, a flooring company, and Generac, a manufacturer of power generators. Though the latter is down 80% since late 2021, Rogers believes it’s poised for a comeback as climate change causes more and more severe weather patterns, the article reports.
Rogers began investing at a young age, after his father gave him stock for birthday and Christmas gifts when he was 12. He’s made a career out of buying equities that no one else seems to want, a strategy that has often paid off in times of crisis. Speaking of the current climate, Rogers told Forbes, “This storm is the worst since ’08 and ’09. There are so many extraordinary bargains.”
———————————————
Validea runs stock and ETF models based on investment strategies with proven long-term track records. If you’re new to Validea, consider taking a look at our product overview or introductory videos.