Whether you’re investing in ASX small caps, global large caps, or somewhere in between, one challenge that all investors face is how to narrow down a huge universe of potential companies into a manageable list for research. Sam Granger, Portfolio Manager at Totus Capital, knows this challenge all too well. With a small investment team, the Totus High Conviction Fund covers small and large cap companies both in Australia and overseas. One strategy he uses to narrow down the field, is the draw on the research of other great investors.
“We always do our own research, and I’d never buy a stock just because they bought it. But why not focus on businesses that other great investors have already said they like? Apple’s a great example. Buffett bought Apple in 2016… You could’ve made three or four times your money just by following Buffett into Apple.”
In this episode, we also hear why he doesn't engage in short selling, and he shares two stocks that appear to be underappreciated by the market.
- 1:46 – Sam’s favourite The Rules of Investing episode
- 2:31 – How his family helped shape his investing career
- 5:23 – An area to focus on and upskill
- 6:46 – Why he doesn’t engage in short selling
- 9:09 – Lessons learned working with Ben McGarry
- 10:25 – Don’t focus on short-term performance, even if it’s good
- 13:22 – Evolving the allocation for the Fund
- 15:07 – How to cover a large universe of stocks with a small team
- 19:01 – An example of a global company Sam likes
- 21:50 – What Sam sees playing out for Spotify in the future
- 24:33 – The investment case for Objective Corp
- 26:48 – Is there still upside for the stock?
- 29:40 – Sam answers our three favourite questions
Funds That Outperform Their Benchmarks Still Have Periods of Underperformance, by Paul Kaplan
- 7 Powers: The Foundations of Business Strategy Paperback, by Hamilton Helmer.
An ounce of performance is worth pounds of promises
Totus Capital is a Sydney based investment manager focused on Australian and developed market equities. Their long/short capabilities utilise fundamental bottom up research to identify mispriced securities. You can follow Sam here or visit the Totus website for more information.
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Great interview Pat - really enjoyed learning about Sam’s process and approach.
Nice to hear Sams fresh insights.
Pat, a very interesting insight into the learnings required of a younger fund manager. Highlight for me, Sam's maturity in his quick assessment/judgement of the factors needed to be considered in his analysis for his answer your regular hypothetical last question.
Nice one Pat!
enjoyed this learned a fair bit.