Flowers hopes, in other words, to make a lot of money at the expense of clumsy governments around the world. While this strategy has landed him on Forbes 400 list of richest Americans for three straight years, it is less clear how it has worked out for investors in his funds.
Throughout his decade-long career in private equity, Flowers' investments were up just 30% through Sept. 30, according to documents prepared for investors and recently reviewed by TheStreet.com. It is safe to assume that number is considerably lower today, given that the S&P 500 is down by more than 33% since that date.
Flowers' investments are highly concentrated. According to the investor documents (which precede the IndyMac transaction) just four banks account for roughly 80% of all the capital he has invested. In addition to Shinsei and Hypo, Flowers' other major investments are in HSH, another German bank, and NIBC, a Dutch bank. Because they are not publicly traded, they are more difficult to value. As of Sept. 30, Flowers valued NIBC at 80% of what he originally invested and HSH at 70%, according to the investor documents.
Nonetheless, Flowers has some prominent defenders, such as former Goldman Sachs Chairman John Whitehead." A lot of investors, in what they decide to do for the money under their direction, diversify so much that they really limit their chances of great success," Whitehead says. "Chris will place big bets on things that he believes in. I admire that quality."
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV