Investment success does not come from ‘buying good things', but rather from ‘buying things well'. Simon Gergel, fund manager at The Merchants Trust, explores this theory.
One of the most pronounced trends in the stock market since the global financial crisis has been the continued outperformance of “quality” companies. Often found within the consumer, healthcare and business services sectors, these companies typically exhibit certain common characteristics such as dominant market shares, defendable business models with limited economic cyclicality, high returns on capital, and sustainable long term revenue growth. In the FTSE 100, the likes of Diageo, British American Tobacco, Intertek and others have all strongly outperformed the market over the past ...
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