Breaking New Grounds in Alternative Credit Management with James Dondero

Alternative credit management was unchartered waters just a decade ago but today companies and individuals are moving alternative assets across states and regions successfully while making a fortune. In the Contemporary financial markets, investors dedicated their time to rising market loans as well as high yield investments. They laid less emphasis on the diversification within a fixed return asset base and didn’t consider venturing into hedge funds and private equity with the thought that it would capture variation in skill and strategy.

However, today alternative credit has grown rapidly to become a massive asset attracting the attention of institutional investors like Highland Capital Management, a Dallas-based investment adviser co-founded by James Dondero. Alternative Credit refers to credit that isn’t core or a traditional investment-grade corporate. Consequently, it involves high yield, hedge funds, distressed situations, private equity and collateralized loan obligations. The CLO was introduced recently to the market pioneered by high powered individuals like James Dondero of Highland Capital.

Mr. Dondero has been in the financial business for the past three decades operating in the credit and equity markets. Jim has broad knowledge in the field of alternative credit. Courageous enough to venture in that kind of business, he has been able to grow in the finance area making credit policies and establishing portfolios for several companies such as GIC Subsidiary and American Express. James Dondero currently specializes in providing solutions regarding credit for startups and retail investors. He has spearheaded the production of award-winning policies in separate institutional accounts, Collateralized Loan Obligation, private equity and mutual funds among others.

Alternative credit involves both liquid and illiquid credit structures which have different forms of profit drivers that are far reaching than those included in the traditional credit obligations. The latter includes high-risk scenarios and can be affected by inflation. Despite the fact that illiquidity is usually associated with alternative credit, they operate exceptionally well in the less efficient market making it a key attraction to serial investors like James Dondero and his affiliates at Highland Capital.

Alternative credit is also famous for producing extra returns by accessing illiquidity and sophisticated thematic market drivers. High diversity in emerging markets and mortgage, for instance, offers backed security and protection from credit-to-market movements to portfolios dealing in alternative credit. It is through these extra benefits that James Dondero and Highland Capital have been able to amass over $18 million in assets.

James Dondero is the President and co-founder of Highland Capital besides being the lead manager of CLOs in the US regarding dollar value. Before establishing his personal alternative investment company, he worked at the Protective Life GIC subordinate firm where he helped raise over two billion in assets in the period between 1989 and 1993. Another milestone in his career is the right to use Chartered Analyst designation. James Dondero attended the University of Virginia from where he graduated with a bachelor’s degree in accounting and finance.

Besides his successful career, James Dondero gives back to the community through his philanthropic duties in the famous Dallas Donations. He has contributed millions to non-profit and charity based organizations around the region. He is also a part of the Highland Capital Scholars program and has contributed over two billion to undergraduates training for policymaking and leadership in Southern Methodist University.


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