castlebay-invetment.png

Investment Approach

Our Investment Process

We invest in companies for the long term. We do not speculate on short term share prices.

Our investment process illustrates our valuation discipline, focus on quality companies and bottom up approach.

Process.png

  • Valuation discipline
  • Investment database screens UK FTSE All share excluding Investment Trusts.
  • Quantitative valuation screen assesses current valuation versus its own long term average.
  • Valuation mean reversion central to analysis.
  • Coincidental share price and valuation peak and trough
  • Passing the Quality test
  • Margin of Safety - valuation and operational
  • Model constructed for each company to analyse: -Financial metrics and how the shape of the business has changed with a focus on Cash flows.
  • Moat - dominant position and pricing power
  • Management - track record, transparency and honesty
  • Unconstrained portfolio
  • Bottom up portfolio of 20-30 companies unconstrained by benchmarks
  • Margin of safety score plus free cash flow yield score determine position in portfolio.
  • When companies we like get cheaper we buy more.
  • Competition for capital: screened stocks ranked against existing holdings

 

The Partners have assembled an Advisory Panel which convenes every six months to discuss:

  • The macroeconomic environment as a top down overlay to our bottom up approach.
  • Any changes to the portfolio over the past six months and check they have been in line with our investment process. 
  • Reviewing the investment case for existing portfolio holdings.

We are very grateful to Mick Brewis and Richard Burns for their contribution and support. 

Castlebay Investment Partners LLP is authorised and regulated by the Financial Conduct Authority (624445)
Registered Office: Crosstrees House, 14 Sandyford Place, Glasgow  G3 7NB  Tel: 0141 212 7930
Castlebay Investment Partners LLP is a Scottish Registered Limited Liability Partnership SO304149

This site uses cookies. Some of the cookies we use are essential for parts of the site to operate and have already been set. You may delete and block all cookies from this site, but parts of the site will not work.