Ares Our Business Private Equity Special Opportunities

Our investment philosophy, portfolio construction and portfolio management combine a value-oriented approach based on fundamental research and comprehensive due diligence designed to identify the most attractive risk adjusted return opportunities within our investable universe. Our disciplined approach is focused on identifying sustainable business franchises with leading and defensible market positions, attractive pools of assets that demonstrate strong cash flow characteristics and out-of-favor assets that we believe can be sourced at meaningful discounts to fair value.

Core elements of our investment strategy include the following key characteristics:

  • Target investment opportunities with compelling 3:1 reward to risk ratio
  • Credit-intensive underwriting driven by Ares’ proprietary research
  • Sourcing investments with measurable cash flow characteristics
  • Attractive investment “creation” multiple
  • Extracting illiquidity discounts associated with out-of-favor assets
  • Identifiable catalysts for capital appreciation or risk mitigation

While the principal strategy is bottom-up “credit-picking”, we also incorporate macroeconomic views to adjust and execute a portfolio strategy that seeks to enhance returns and mitigate systemic risks. We seek to mitigate risks by building a diversified investment portfolio across a wide array of investments and industries comprised of corporate credit and corporate and consumer asset-backed investments. This is done by utilizing a variety of specific quantitative and qualitative portfolio measures, primarily assessments of risk concentrations along different parameters (e.g. issuer and industry limits). Additionally, we underscore the importance of active asset management through rigorous ongoing monitoring and due diligence to promote early detection of any performance related issues.