Investment Strategy  

Selector’s strategy is to invest sensibly for the long term. To achieve this Selector applies bottom up stock selection to identify good businesses selling at a fair price. Our portfolios are made up of our best ideas rather than slight deviations from a given index.

As a good business evolves into a great business its underlying real earnings per share grows. Selector aims to capture as much of this earnings growth as possible over time, since it is real earnings growth that translates into share price appreciation.

The consistent bottom up process employed by Selector looks at a combination of the quantitative and qualitative attributes of a business. No “black box” methodology is employed. In short, our competitive advantage is the ability of our experienced portfolio managers to access the people managing a business and assess the sustainability of its model. Our 4 step stock selection process is outlined in "stock selection". This process generates our best ideas. - see drop down menu above.

Our best ideas form a concentrated portfolio of Australian businesses. The portfolio will generally consist of 15 – 30 investments. As such, individual investments may represent greater than 5% of the total investment portfolio. If selected correctly, individual stocks in a concentrated portfolio will have a meaningful impact on performance and may grow well beyond the initial 5% level.

Selector is benchmark indifferent. In essence we are backing our consistent investment process and our portfolio managers deep industry experience, rather than benchmarking against an index. Selector believes indexing limits returns to investors over the long run. Our long-term investment horizon aims to capture real earnings per share growth, reduce volatility and provide attractive taxation implications for the Fund and its investors.

Selector invests in Australian equities, does not use leverage or derivatives and avoids start ups and turnaround situations. Experience has taught us that these simple constraints when combined with Selector’s hard risk limits provide significant protection to the portfolio with limited impact on the performance of the fund.