Our Research & Stock Selection Process

Our process has been refined over more than 3 years and is designed to identify and select companies offering the best value from around the world.

1. Each analyst uses professional software tools to electronically screen the universe of stocks for those measures of value that the analyst deems to be most important (i.e. Price/Earnings, Price/Tangible Book, etc.). These value screens will typically narrow the field from thousands (possibly even tens of thousands) of companies down to dozens.
2. The analyst assesses remaining stocks in more detail in order to eliminate those that are obviously unsuitable, with a goal of reducing the number of candidate companies to single figures.
3. Full reports are written on the remaining companies. These reports are designed to provide an exhaustive breakdown of a company’s operations over a minimum 5-year period. Often, as an analyst goes into this level of detail, issues will emerge that rule a company out of the process.
4. A stock selection meeting is convened, at which reporting analysts present their findings. During this meeting, companies are dissected by the team. If even one analyst deems a company to be unacceptable that person has the right to veto the company, which is then immediately removed from further consideration.
5. The analysts then individually grade all companies that have not been vetoed. Each company has to average a certain grade to be put forward for inclusion into the portfolio. Any company that fails to achieve this mark is discarded.
6. Each remaining company is compared with existing portfolio holdings. If a number of stocks are already held in a similar sector or geographical area, existing stock may well need to be sold to make way for the new company. In this case, a new company would have to represent a tangible improvement over existing holdings. It regularly happens that stocks go all the way through the process and achieve the requisite grades for inclusion, only to be discarded at this stage.

Over any given period of time, irrespective of whether any trading actually takes place, we are continually combing global markets and challenging our current portfolio holdings.