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Investment philosophy and process
Distinctive investment philosophy
Producing positive long-term investment returns calls for a distinctive investment philosophy, along with a robust and repeatable investment process. Our approach is based on our Focus on Change philosophy, and we apply it to help us identify the key factors driving the market price of an investment.
Understanding the dynamics behind these drivers is what lets us focus on the factors that will cause the stock market to change direction and ultimately produce a revised price. We have found that the best opportunities come in the investments where we not only have the deepest insights but also the greatest conviction that market expectations are going to change.
Robust investment process
Delivering investment performance depends on our ability to generate ideas and insights. Our investment process takes a bottom-up approach, seeking to uncover those stocks with real potential. To achieve this, we place meticulous research at the heart of our approach. Company meetings are an essential part of this process – in fact they are the source of the vast majority of our non-consensus investment insights. Our size and reputation ensure we have first-rate access to firms, through both structured meetings and regular conversations with key decision-makers.
To ensure we can share investment insights across teams and global locations, we've established a global communications platform, based on regular meetings, video conferences, a variety of in-house analysis and information management systems. These meetings and systems provide a forum for analysts across geographies and asset classes to exchange market information and ideas. By using our common investment language, we ensure these insights are rigorously tested and presented in a way that can be easily understood and exploited by our investment teams.
For example, our views of a Canadian mining stock might come from a meeting with its company management in Montreal, a competitor interview in the US or a macroeconomic analysis of China completed in Edinburgh. The more pieces of corroborating evidence we can amass, the greater the conviction we can take on an investment position and value we can add for our clients.
Our investment process doesn't end with the purchase of assets. We continually monitor our portfolios to ensure they are meeting their objectives within the defined risk parameters. We have a dedicated risk management team and our fund managers also play an active role in managing risk within clients' funds.