AFL Legend Chris Judd provides insight into his investing strategy

No he isn't.

Here Chris had me thinking he was an amazing value investors and was aware of the cognitive biases individual and institution investors make that allow value investors to consistently beat the market.

By limiting his investments to small cap stocks (with a market cap from $30-50 million) he looks at companies that are so small that most funds won’t invest in them. These companies are usually not covered by industry analysts due to their comparatively small size.

Value investors concentrate their search for investments so as to improve their chances of being on the right side of that trade. They look for obscure stocks — small caps, spin-offs and boring stocks with low analyst coverage; those that are distressed, bankrupt or otherwise disappointing; and those that have low growth, low price-to-earnings and low market-to-book ratios because of company or industry problems.

They understand that most investors — corporate and individual — avoid these stocks and that this produces bargains.

But how the fuck does Chris source ideas from companies that aren't covered by analysts using a network of analysts?

He starts his process with a macro theme (looking at it from the top down) – previous macro themes he likes have included electrified cars and our ageing population. He also deals with 10-11 brokers around Australia to source ideas and reading material.

He also said he invests based on themes. The themes he suggested are all littered with overpriced and over hyped glamour stocks with negative cash flows.

Electrification of vehicles, climate change, ageing population/healthcare and artificial intelligence.

And the one investment Chris mention was paragon healthcare which has halved since this interview. I doubt Chris is beating the market.

/r/ausstocks Thread Parent