Our competitive advantage is that our investment team has a number years in the market with a diverse range of relationships and experience and as a result can often spot ideas or trends before less experienced managers.
We have a number of sources of leads for company specific investment ideas:
- Quantitative models combined with data visualisation techniques to efficiently identify ideas
- Experience and wider reading across digital and electronic media
- Presentations by companies, mainly to the Investment Analysts Society. Some corporates do their own presentations, so we would attend if that company is on the closer research radar.
- Company results. All companies release results and these are easily available to us via electronic technology.
The above are Steps 01 & 02 in our 6 Step Investment Process:
Our idea generation is largely driven by our Macro view as we believe this creates the ideal tailwind environment for a company. However, this is not always the case, especially in our local market where bottom up valuations play a more significant role due to the smaller pool of investments. We focus our best effort on our best ideas. If there is a good macro/top-down theme we would use that to find companies that would benefit from it. If on the other hand a company has a good investment case but it is in a bad industry or macro environment but it is still able to extract value from that industry or economy and the valuations allow for a good “margin of safety” we would also invest.
Best Effort into Best Ideas
We apply a “best effort into best ideas” philosophy and will therefore by definition not for example have a ranking table of stocks. We have various screens and data visualisation tools to highlight potential investment ideas. A key objective of our process is to find enough good ideas to make it into the portfolios. As long as we are able to find enough good ideas, we will continue to add alpha through active stock selection.
Our investment philosophy is also completely benchmark agnostic and there is therefore no need to cover all stocks in detail simply because they are part of some index.
We are also making use of research from brokers such as Merrill Lynch, Deutsche Bank, Avior, RMB, Barclays, JP Morgan etc.
We use data visualisation techniques to efficiently highlight investment ideas. Below are a few screenshots of some of our screens: