Net Net: Promoting innovation and managing change
Net Net: Promoting innovation and managing change

Forget Icahn, this big hedge funder loves boards

John Burbank, Passport Capital
Rick Wilking | Reuters

Carl Icahn and other corporate agitators may think many American boards are terrible, but at least one prominent hedge fund manager thinks they've never been better.

"I've never seen it so good in terms of the nondelusional, sober mindset of American business people," said John Burbank, founder of $4 billion hedge fund firm Passport Capital.

"We should feel really the best you ever felt about the state of boardrooms in America and how they're thinking about the future," Burbank added while speaking at the Alpha Hedge West conference in San Francisco on Monday. "U.S. equities have this incredible quality: good [capital expenditure], good governance and leading innovation. It's hard for me to paint a bearish case for U.S. assets."

He said this would be "the decade" for U.S. stocks.

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More broadly, Burbank is bullish on large, innovative American companies. He likened betting on them to wagering on the U.S. men's basketball team versus other countries in the Olympics.

"There might be an upset, but I just don't see it," he joked.

"The U.S. is far ahead of Europe or Japan and certainly of [emerging markets]. The rest of the world wants to buy developed market assets, quality—the best assets in the world," Burbank said.

"I don't see why this ends in the next three to five years," Burbank said. "People are going to have to get used to a very different environment that may feature very low rates, pretty good growth for leading companies and the constant buying interest of the world."

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The firm's flaghip Passport Global Strategy fund is up 1.81 percent in 2014 through August net of fees. The U.S. stock-focused Passport Long Short Strategy is up 0.99 percent over the same period.

Burbank was surrounded by about a dozen people after his remarks at the Information Management Network event held at the Ritz-Carlton in San Francisco's financial district. Passport, founded in 2000, is based in the city.