Information Overload

In today’s digital world, there are so many information sources for investors—probably too many. In the U.S., investors have access to FRED^®, which provides myriad economic data. The OECD provides tons of data on individual countries internationally. But investors can simply search the internet for information. For example, you can google “telecom regulatory policies in the U.K.” and get a link directly to the regulator’s website. Of course, information is just that – information.

The hardest part is figuring out what information actually matters for a particular company. As bottom-up investors, our research process starts at the company level. We read through filings, understand who competitors are, talk to the investor relations team, attend conferences, and speak with people who understand the company better than we do. For us, the most important aspect of gathering all this information is estimating intrinsic value—it’s central to everything we do.

After we examine a company from the inside, we then look at external factors. For example, what do changing health care policies in China mean for this particular Chinese health care provider? Or how will Brexit impact operations for this U.K. company? As portfolio managers, we follow a wide variety of companies operating throughout the world, and have formed opinions about political, economic, inflation and market dynamics for many countries. However, we’re careful not to let our macro views unduly influence our portfolios. As bottom-up investors, we rely on our business analysis and equity valuation work first and foremost. This is what we do every day and what we believe to be our area of expertise. By staying focused on our core strengths, we enhance our ability to deliver competitive returns over a full market cycle.