The cyclical nature of lodging and the high correlation of lodging performance with key financial metrics require a high level of capital markets expertise and familiarity with financial instruments. To maximize shareholder returns as well as minimize risk, our management team keeps equally informed about capital market movements as it does hotel industry trends. To complement our hotel industry relations, we also maintain an extensive network of capital market relations and advisors. By combining hotel industry knowledge with capital market strategies, we believe we are better able to determine the debt strategies to maximize funds from operations.
We use leverage to enhance shareholder return, and we tenaciously mine the market to seek the most competitive terms available when financing or refinancing our properties. We use derivatives to better align our cash flow performance with market conditions, and typically use such products to reduce risk. By being both a lender and a borrower as part of our overall investment strategy, we believe we have enhanced market intelligence on terms, pricing, and structure.