What kind of guiding principles could investors pin to their office wall? Here are some suggestions from our Global Equities team.
This blog is the last in our series of blogs, in which we dive into the strategy and daily life of Evli’s Global Equities team. The Global Equities team invests in underpriced companies that generate cash flow and have strong debt coverage.
My grandmother had a framed embroidery hanging on her wall. The beautiful handicraft contained a quotation – an old life lesson, really. Upon waking and opening your eyes, it gave you inspiration for a new day.
So, what could a Portfolio Manager hang on his or her wall, just above the monitor?
"Choose your principles and follow them!”
First, think carefully and choose your investment principles. Then follow through with them, in a disciplined manner, every day. This applies even – and especially – through thick and thin. The Global Equities team's investment strategy is also based on this approach.
Read further: Investing requires independent thinking, not imitation
”Avoid confusion, focus on the essential!”
The more factors you take into consideration when making your investment decisions, the more difficult life gets. In the Global Equities team’s process, we take care in selecting the decisive factors, and these can also be used to analyse themes related to responsibility.
Read further: Our way of integrating ESG into investment decisions
”Think for yourself!”
In all its simplicity, this allows for a wide variety of interpretations: Don’t panic. Don't follow the herd. Dare to think outside the box and choose your investments wisely.
Read further: Good investment opportunities still exist
A timeless expression, though perhaps not so popular today. This particularly applies when it comes to doing financial statement analysis. Don’t immediately think you have all the answers, but have the patience to find out first. Keep your mind open to new ideas. Dare to fix your perception if it turns out to be wrong. In the Global Equities team, this means active discussion and challenging your own thinking.
Read further: What exactly goes on in the portfolio managers’ room?