savings Investment Philosophy
In today’s global investment environment, mind boggling amount of liquidity is sloshing around, there is an information overload through social media and a huge number of new investors have entered the market. All this has made market cycles short, sharp and swift. In this volatile investment environment, it becomes even more important to have a robust investment philosophy and strategy based on time tested principles and focused on the long term. Serious wealth can only be created, not by trying to time the market and catching the odd tip, or getting the odd stock call right, but by consistent and disciplined long term investment approach. Creating serious wealth by investing is a marathon not a sprint.
At Green Lantern Capital, we play test match rather than a T20. It is our strong belief that “Time in the Market” is more important than “Timing the Market”. It is near impossible to consistently time the market, so rather than getting swayed by the short term volatility, we focus ourselves on identifying large macro-economic trends and finding businesses capable of capitalizing on them to create long term wealth. Rather than focusing on meagre outcomes, this helps us catch asymmetric rewards, earning inflection points, faster growth for longer and all this with high margins of safety!
Additionally, this is achieved with a risk conscious approach. Risk for us emanates from paying a high price for the businesses, volatility in earnings and cash flows or highly levered Balance Sheet or over ownership of their stock.
We believe that this approach will keep our customers in good stead with their investments. This stems from our deep rooted belief that good, well run businesses in the long run tend to be well rewarded and being miser with what we pay for them, helps in insulating capital from downside.
Quality companies in growth markets:
- Strong franchises + good/ethical managements
- Large market opportunities, strong competitive characteristics and high ROE
- Industry leaders
- Hunger for growth
Risk conscious approach:
- Valuation Risk
- Earnings Risk
- Balance Sheet Risk
- Over-ownership risk
Our investment principles:
- Absolute return mindset
- Asymmetric risk return approach
- Disciplined approach to selling
- Combine top down and bottom up approach
- Capitalising on occasional tactical opportunities
- Ability to use cash as a hedge