Bob Rodriguez: The best advice I ever got

@FortuneMagazine February 8, 2012: 1:23 PM ET
Bob Rodriguez

Bob Rodriguez: "I became a good historian."

FORTUNE -- "In the fall of 1974 I was in graduate school at USC taking a portfolio-management investment course. The financial markets were in difficulty, and I didn't understand how securities were being sold at such depressed levels. I had only recently discovered Security Analysis by Graham and Dodd when we had a guest lecturer come in named Charlie Munger, who went on about this idea of value investing. After the class was over, I walked up to Charlie and asked him if there was one thing that I could do that would make me a better investment professional. His answer was, 'Read history, read history, read history.' And so I became a good historian, reading both economic and financial history as well as general history.

"What I learned is that people relate to the crises they have experienced. So when the crisis of 2008 came, it felt like an old friend to me because it had so many similarities to the banking crisis of 1907. Asking Charlie's advice and then reading history allowed me to put those things in context."

Bob Rodriguez

Age: 63

Job experience: Managing partner and CEO of $17 billion value investing firm First Pacific Advisors; serves as strategic adviser to two funds he used to manage: equity fund FPA Capital and bond fund FPA New Income; on board of advisers for the Center for Investment Studies at USC; former portfolio manager at Transamerica.

Claim to fame: Bond fund FPA New Income has never had an annual loss under his management, according to Morningstar; stock fund FPA Capital has returned 15% a year for the past 25 years. He foresaw both the Internet bubble and 2008 financial crisis.

This article is from the February 6, 2012 issue of Fortune. To top of page

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