Two-pronged approach works
The combination of a fundamental and quantitative approach to stock selection has proven to be a successful blend for Putnam Investments
According to the company’s Global Core portfolio manager Brad Greenleaf, Putnam has developed a track record for outperformance by focusing on stocks that satisfy both fundamental and quantitative factors.
“Quantitative doesn’t capture everything you need to know about a stock, fundamental doesn’t either, but when you put the two together it’s very powerful,” he said.
He said Putnam had been utilising a fundamental approach for a number of years, whereby it adopted a rigorous bottom-up process to identify, evaluate and understand key factors affecting a company and its stock price.
He contends that adding a multi-factor valuation system that ranks stock attractiveness across a broad universe would deliver consistent returns on a long-term basis.
The investment manager recently released a fund into the Australian market, the Putnam Global Concentrated fund, which employs both approaches.
AUTHOR
Recommended for you
As the government announces a public inquiry into the collapse of Dixon Advisory, risk adviser Richard Silberman has detailed the three areas that typically lead to an AFSL's collapse.
With a growing number of advisers now running their own business, they need to pivot their career identity to being a business owner rather than just as a financial adviser if they want to futureproof their business.
Zenith Investment Partners has launched a range of new managed account portfolios over the past quarter, including on Insignia Financial’s Expand platform.
The financial services technology firm has officially launched its digital advice and education solution for superannuation funds and other industry players.
