Performance

Chart of the month: Highland Crusader

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Highland Capital Management's Crusader Fund finished last year on a high, gaining 5.64% in December to bring its 2006 full-year net gain to 39.63%. Core holdings in automotive, power, healthcare and telecom lifted returns far above the Absolute Return Distressed Index, which gained 1.76% in December to total 13.57% for the year.

The portfolio, managed by Jim Dondero and Pat Daugherty, follows a bottom-up approach and since its July 2000 inception has netted an annualized compound return of 26.88%. Dallas, Texas-based Highland Capital was founded in 1993 by Dondero and Mark Okada. The firm manages about $4 billion in