Watchlist review: Jan 2018

What goes on the watchlist is a key part of my investing process, as it is where I screen possible investment candidates for quality (which I define as the likely extent, certainty and consistency of future growth in profits). I only ever want to invest in the highest quality shares, as I believe this is the key driver of excess returns in the long run. You can read about how I try to identify quality here.

I’ve recently opened up my watchlist to US and EU listed shares and allowed it to grow from 60 to 100 members. The shares have been selected using my standard quantitative screens followed by a lot of thought about which have the best competitive advantages and growth prospects. This has been an iterative process over a few months, gradually replacing the incumbents with better candidates as I find and research them. Continue reading

Broadening horizons

There has been one a rather obvious way to improve my investment performance that I haven’t yet exploited. It has been on the back of mind for some time. This is to broaden the universe of stocks I invest in to beyond those that trade on the London Stock Exchange. I think the benefits of this have the potential to be quite dramatic. Continue reading

Mega cap shares to buy and hold

I’ve wondered which shares I would hold if I was only invested in the FTSE 100. Very large businesses tend to be somewhat more durable and less volatile. If I was someone that didn’t want to spend a lot of time and effort monitoring a set of smaller cap stocks I might stick to investing in a basket of megacap stocks for the long term. For me, the choice of which stocks I would include is not that hard. Continue reading

Watchlist review

I first introduced my watchlist here. Since then I have made some updates including recording my watchlist with scores in a spreadsheet.

This review looks at what has changed substantively to the watchlist since I first introduced it: what has been added, what has been removed and what has been considered but rejected. There’s been quite a bit of change to the watchlist since last time – I expect there to be a lot less churn next time. Continue reading

Watchlist review

I wasn’t going to say much about my watchlist to maintain a bit of mystery and so my hordes of followers didn’t inflate the prices of the stocks I on the list before I bought them. But thinking about it the one reader who seems to be following my blog at the moment is from China and may not even speak good English let alone have enough money at hand to invest in the UK stock market to do this.

Developing and maintaining a watchlist of the best possible shares on the UK market is a key part of my process so here’s how I go about it and what’s on the list. Continue reading