Value.able: The Best Defence
What is the definition of a defensive investment? Despite the tired and predictable answers you are likely to get from the advice industry, it’s a fascinating question to ponder at a time when many traditionally ‘safe’ investment choices are exceedingly unattractive. Roger Montgomery has spent some time thinking about this conundrum and has arrived at an unorthodox conclusion. Read Roger’s article at www.eurekareport.com.au.
Roger Montgomery is the Founder and Chairman of Montgomery Investment Management. Roger has over three decades of experience in funds management and related activities, including equities analysis, equity and derivatives strategy, trading and stockbroking. Prior to establishing Montgomery, Roger held positions at Ord Minnett Jardine Fleming, BT (Australia) Limited and Merrill Lynch.
This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.
Michael
:
Hi Roger,
By now we should all know that we need to do our own research to understand a company before even considering investing in it. It seems that an important part of this for you is actually meeting with the company to better understand things like future prospects. This is something that is simply out of reach for your average value investor. I have to admit that I am a bit confused by what we mean when we talk about understanding a company. It seems to be a term that is used fairly loosely. Are we simply talking about things like cashflow and competitive advantage, or are we acutally talking about information you can only glean from meeting with company executives?
I have no doubt that your service will provide all sorts of useful metrics and for me this will probably be enough to sign up. But given that “understanding” a company is such an important part of the value.able approach, how will you A1 service help us do that? I acknowledge that you have been very generous in the information you have shared from the meetings you have had with companies. JBH is the most notable recent example. But will your service offer something more that will help us truly understand a company?
Thanks,
Michael
Roger Montgomery
:
The numbers matter more. Ben just posted a comment about HVN and having read the annual report he concluded “it’s almost like a REIT”. That’s understanding and no meeting with management required.
ron shamgar
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http://leadership.businessspectator.com.au/management-insights
NWT COO interview.
Andrew
:
Lets flip it around roger, what is an offensive investment?
I think defence or offence are misleading terms. I will prefer for just a team that can defend well and attack with equal skill. Sounds a lot like your A1 companys. You need both aspects firing for a good investment.
If a cricket team can bat all day but the bowlers can’t take wickets than your still not going to get any victories.
I assume by defensive people mean more of a security analysis definition of investment in regards to security of principal. But really an investment should neither be seen as defensive, growth, offensive etc.
I don’t want anything other than simply “good” investments which are high quality companys with good prospects at attractive prices. Seems pretty simple doesn’t it.
Roger Montgomery
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Love it!
Andrew
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Also, my cricket analogy was meant in regards to Test Cricket which is my preference. I will leave T20 to the day traders and One Dayers to the technical analysis traders. The rules are different there and perhaps one only needs to worry about the amount of runs scored (bowling is the more defensive aspect in these versions).
I wonder if there is a correlation to ones preference for the version of cricket and investing style. I prefer tests and also value investing. Both are seen with a long term time frame where quality/skill tends to be the biggest factor over luck and speculation.