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Michael Jacks Benedicte Gravrand, Opalesque Geneva: According to a bottom-up fundamental investment manager, what makes a good company is the following: exceptional good management teams, a high degree of visibility over time, and robust business models that can perform in different tax and economic conditions.
However, a good company is not always a good investment, continues Michael Jacks, portfolio manager at South Africa-based CoroCapital.
"This comes down to issues at entry and exit levels and the valuation of a stock," he says in an Opalesque TV interview. "We don't buy stock just because they're a good company. We pay a lot of attention to market momentum. So when you're looking at a potential investment, it's not only the fundamental analysis deciding whether or not it's a good company, it's having a look at the other market dynamics. For instance, what percentage shareholding is held by foreigners; and understanding where the source of the foreigners' capital comes from, their funding requirements, their return on capital requirements. This will help you to better understand the valuation of a stock. We also look at the nature of the shareholders and the potential for those shareholders to have to sell or exit at a point in time, or at the potential for them to increase their stak...................... To view our full article Click here
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