Ian Anderson 11 a.m., Dec. 9
Brandes Investment Partners Still Underperforming Sharply, Losing Clients
San Diego's money management firm Brandes Investment Partners continues its string of disastrous investments, particularly in financial and newspaper companies. Today (Jan. 20), the stock of Royal Bank of Scotland plunged 69.31 percent. The British government owns the majority of the stock and investors believe it will take over the rest, wiping out shareholders completely. Brandes is the largest institutional shareholder with 2.69 percent of the stock. Earlier, Brandes lost big bucks as one of the major investors in Freddie Mac, Washington Mutual, and Countrywide. (The last two were taken over for prices far below what Brandes paid. Freddie closed today at 65 cents, down 7.14 percent; Brandes is no longer one of the largest institutional investors.) Brandes at last accounting (Sept. 30) owned 6.58 percent of McClatchy Newspapers, having bought in at $44.50. It closed today at 75 cents. Brandes owns 10.81 percent of Gannett, and began buying between $53 and $58. It closed today at $7.02. In late 2007, Brandes had $125 billion under management. At yearend 2008, that was down to $52.9 billion. Last year, according to the Brandes website, the manager's stocks generally underperformed benchmarks. Some examples: U.S. so-called "value" stocks (buying of depressed stocks): Brandes was down 55.44 percent while the benchmark was down 37 percent. Global equity: Brandes down 44.33 percent, benchmark down 40.7 percent. Global stocks and bonds: Brandes down 32.9 percent, benchmark down 19.52 percent. U.S. midcap stocks: Brandes down 57.53 percent, benchmark down 41.46 percent. U.S. small cap: Brandes down 59.51 percent, benchmark down 33.8. There were a handful of better performances: international small caps: Brandes down 40.73 percent, benchmark down 47.67 percent. Charles Brandes, founder of the firm, recently built the most expensive house ever constructed in the county, estimated by Forbes Magazine as costing $60 million. Charles Brandes and his new, young wife are frequently featured in the society columns.