When picking stocks focus on G.I.V.E
Absolute return fund manager, Monash Investors, is encouraging investors to focus on growth, insights, value and key events when eyeing investment opportunities.
Monash Investors co-portfolio manager, Simon Shields said many of the firm's investments were guided by those four principals, referred to in the company as ‘G.I.V.E'.
In a world of share price fluctuations, forecasts and complex company valuations, investors were encouraged to think about smarter ways to assess listed stocks, and this could help, the firm said. When investors looked at growth, they should be looking for strong sales growth, or cash flows and the opposite when they wanted to short, Shields said.
When it came to insights, he said a stock needed to be misunderstood by the market and able to be rectified, while value could be found when there was difference between a target and current price.
And finally, when it came to an event, there could be a near term catalyst that would impact price.
"As investors, we prefer taking a ‘deep dive' into interesting companies rather than pricing all companies all the time, which is a misallocation of scarce research resources, and which brings us back to our core objective."
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