Investment Process

NCFM's investment philosophy for our global equity fund can be explained in a few words : we try to shift the NORMAL investment curve to the right. In other words if the average risk / return outcome is 7% pa with a certain risk level we aim to limit our downside but also to increase the prospects of excellent returns.

How do we do this:

1) We focus our investing in growing companies (typical market capitalisation of between US$500m- $5bn) which we feel achieve less sellside research and which have the capacity to return between 2x and 5x our initital investment.

2) Our process begins with 5 different idea generating sources including market screens, strong investment themes, use of investor scuttlebutt and hunches and our global list of the world's 50 best companies.

3) This reduces the number of stocks we are looking at from the 63,000 odd listed global companies to  between 300-500 highly prospective stocks. These are whittled down using our NCFM process (a full description of which is in our Info Memorandum or investor presentation).

4) Once stocks are screened down to between 15-25 names we construct our portfolio. Our portfolio is relatively concentrated due to the high conviction nature of our investment process. We don't believe there are large numbers of great companies out there at the wrong prices and when we find opportunities we want put some good capital to work.