Idea Generation & Process

Where do you find your ideas?

The Collective have extensive industry and markets experience. Most ideas come from valuation screening, discussion with peers or observations on market themes that look to be at an inflection point or that are unsustainable.

What countries and market do you look at?

Mainly UK, Europe and the US but will consider Asia as well. Where ever we see opportunities.

Do you only look at small/micro caps?

We are agnostic to size and accept lower liquidity. For us it is about the return potential. Often we find that smaller companies are not as well researched and we are not competing with sophisticated hedge funds and institutions who are constrained on less liquid names.

Is it all value investments or do you look at growth and momentum?

We believe there are extremes developing in value versus growth as a factor. We typically will be looking at deeper value situations but are seeking catalysts. The market is full of value traps – which we wish to avoid. Share price momentum and value do not need to be at odds with each other.

What is your investment timeline?

Our experience is that to earn 2 to 3 times your money you have to be patient. Many of the names we look at are not for day trading given transaction costs. Some of these situations may take 1 to 2 years to play out.

Do you monitor your performance?

Yes – we will make a note of the average daily price on the day of publication and update on performance over the year. We are not afraid of adding to losing positions if the investment case is still valid. We will let you know if we believe the investment case is no longer valid.