Growth and Forecasts EPS Growth Earnings per share growth measures the rate of change in the earnings of a business. It can be forecast or rolling and is generally presented as a %. It is important to consider the basis for the earnings, eg – are management skewing earnings by capitalising certain spend that should…
Month: May 2019
Checklist Investing (2/3)
In this post, we continue our series of exploring some common checklist considerations: Profitability and Strength EBIT Earnings before interest and taxation is probably the simplest way to assess a business’s profitability. We suggest including depreciation & amortisation as a real cost because, although it might be discretionary spend year to year, unless you are…
Active vs Passive Investing
Much of the investment community has debated the topic of active vs passive investing for quite some time now. Looking at the commentary, for example Buffet, who regularly recommends using a tracker over active investing in his letters, and actual fund allocations, eg the huge increase in passive fund allocation over the last few decades,…
Checklist Investing (1/3)
Knowing what we now know about emotions in investing, we can start to try and limit their negative impact on our investment decisions. In this series of articles we explore a few areas of checklists and how they might be helpful to investors when making their own systems and strategies. We explore 6 areas which…
The Paradox of the Investor
We think there is a fundamental decision an investor faces when they think about how to approach the capital allocation. The decision is between how active should I be in the decision making process – should I decide in detail, regularly, where to invest, or should a delegate that decision to something or someone else….
Emotions in Investing (2/2)
Knowing what we now know about emotions in investing, we can start to understand how they impact returns. These impacts including Buying too late We might see an opportunity or stock we like, do our research, get comfortable with it, but fail to act because we concerned and paralysed by potential losses. It is important…