James Dondero’s Biggest Strength as an Investor That Allows Him to Make Bold and Winning Bets

According to James Dondero, investing is a risky endeavor. The higher the amount of risk that investor takes the higher the returns. James began his investment journey more than two decades ago when he established Highland Capital Management in 1993. James was one of the early investors in collateralized loan obligations. James has taken huge risks during his career including making bold calls on American Airlines and finding value in a bankrupt Texas energy Company where Warren Buffet lost his investment.


James Dondero is a man who is calm and collected and takes his time to think through situations. When put under Myers-Briggs tests, he would, without a doubt, fall into the category of introversion, intuition, thinking and perceiving (INTP). The 54-year-old James is hesitant to talk about himself. When pressed to the edge, he admits that his biggest strength is “puzzle solving.” He takes his time to think through complex deals, turnarounds and even analyzes the emerging trends that are critical to the Highland’s investment approach.


Highland Capital offers mutual fund investors with liquid and relatively inexpensive access to some of the best investment ideas that are issued through the $894 million Highland Global Allocation fund. The fund, which grew to 29.6% within one year, was listed in the Morningstar’s world allocation category. The fund shares some similarities with its peers.


Dondero has a vast investment portfolio that can produce big performance swings. Highland Global Allocation fund was ranked in the top place of its peer group in 2014. However, the entry of the fund into the energy sector pulled it down to the bottom in 2015. The fund has recently recorded an improved performance where it reclaimed its top position in 2016.


About James Dondero

James was born in Hoboken, a place where he spent his childhood years. He went to the University of Virginia to pursue accounting and finance. He had huge aspirations of venturing into real estate investing. However, a tough economy swept his career to a different direction to credit. Within his first year of graduation, he was managing fixed-income assets worth $1 billion for the American Express. In 1993, James and Mark Okada partnered with an Insurance company to establish what is now known as Highland Capital Management.