Richard is a highly-respected investment writer well-known for his Share Sleuth portfolio, a model portfolio he runs for the investment platform Interactive investor. Richard eats his own cooking – buying good businesses at reasonable prices and holding them for the long-term in his Self Invested Personal Pension.
I’m a long-time ShareScope and SharePad fan and my aim is to help you find better companies faster using the fantastic tools at your disposal. My focus is on finding businesses we can reasonably expect to prosper for many years. As well as analysing data, I work out the strategies companies are following and try to verify that they are working in the real world by quizzing executives, visiting companies, trying their products and observing how they operate.
In response to a reader’s suggestion, Richard investigates Alpha FX. It is exactly the kind of people-first business that could be building a long-term competitive advantage and consequently grow inexorably. As I was considering what to write about for my last article before the Christmas break, a present from a reader arrived in my inbox.
Business schools identify the sources of competitive advantage that tie customers to companies and what they produce. Fundamentally though, there is only one true competitive advantage: people. If I could recommend one book for long-term investors, it would be “Intelligent Fanatics Project” by Sean Iddings and Ian Cassell, which is subtitled “How great leaders build
Richard uses his “Skin in the game” table to find companies whose directors are major shareholders. The experiment starts off badly with Asset Co., but gets better. Frontier Development and Focusrite could be great owner-managed businesses. To recap: We can use SharePad to find companies that are run by managers who are themselves significant shareholders.
Richard uses SharePad to find companies whose managers are also significant shareholders. They are likely to be building businesses for the long-term, he says. The reasons for investors to look kindly on owner-managers, executives that have large shareholdings in the firms they run, are ably described in this article by Harry Fraser, manager of the
In his quest for companies that control their own destinies, Richard discovers luxury fashion brand Burberry, a company whose products he is in no danger of buying. Last time, I promised to investigate one of the shares I found while filtering for vertically integrated companies, companies that control their own destinies because they control many
Fallout from the demise of Thomas Cook reminds Richard of the virtues of vertical integration. In the month since the demise of Thomas Cook, the company that invented package tours, there has been much talk of rivals who will benefit from the fact that perhaps 2.5m Thomas Cook customers will be looking elsewhere for their
Having found PZ Cussons through his Keep It Simple, Stupid filter, Richard examines the company through its cash flow statement. To his delight, he finds a company promising to keep things simple too. Two weeks ago I augmented my Keep it Simple, Stupid filter to keep things even simpler. The filter is designed to rule
Richard invents a new filter that promises to weed out big acquirers in a drive for simplicity he hopes will make investigating his next company easier. Complications tend to keep investors awake at night and wakeful nights are not conducive to long-term investment. You join me today on a quest for simplicity. Keeping it simple
Richard returns from his holiday and wonders whether he can put the experience to use by investing in holiday companies. First step: Create a portfolio of holiday companies. It is early September, so I am going to take a wild guess and assume you have been on holiday. Hopefully it was a good one. Mine
Richard analyses Bloomsbury Publishing’s segmental report to work out where the profit is coming from. The Harry Potter effect is still evident, but the company is conjuring up another source of profit without recourse to magic. My last article ended on something of a cliffhanger because I had found something out, but I did not
A wise man once advised investors to stick to their circle of competence. Richard uses SharePad to keep his eye on the prize, and it leads him to Bloomsbury Publishing… My base filter in SharePad currently returns a total of 596 shares listed in London. It does not do anything clever. It just excludes the
In response to a reader’s request for a sell filter, Richard goes looking for trouble in his portfolio by setting some “curiosity triggers”…. One of the better bits of advice passed between investors is to sell shares when the reasons you bought them no longer hold true. Most of us will have all sorts of