Investment philosophy
The Harper Bernays investment philosophy draws a great deal from common sense.
Our philosophy is simply to identify outstanding companies worthy of investment.
Our selection process involves a thorough review of all investment opportunities, using a combination of both qualitative and quantitative screening methods. We use industry leading technology and tools, and a broad repository of data in order to develop our universe of investments. We consider a number of factors, including, but not limited to:
- Understanding the business
We make sure that we understand the business in detail and the long-term prospects for the industry in which it operates. We take a view as to whether or not the corporate strategy of the business is realistic, relative to its peers. - Outstanding management
We look for outstanding management which is capable and focused on building shareholder value. Our preference is for companies in which management’s and shareholders’ interests are aligned. We believe that, notwithstanding the quality of a company’s assets, management leadership is critical to a company’s success. - Growth and edge
We look for companies with an enduring competitive advantage and potential for sustainable earnings growth. - Undervalued companies
We look to identify companies where the market valuation of their business differs from our valuation. - Long term investments
Our preference is to hold investments for the long-term provided the company continues to perform. We have a bias towards companies with sound long-term prospects, as opposed to short term trading prospects.
If a company meets all these criteria, then we meet with management to ensure that our investment analysis is consistent with how management is planning the future of the company. As professional investment managers, we seek to make rational and objective investment decisions based on our extensive knowledge of the market and its opportunities. From a broad range of opportunities, we carefully select the right investments to meet each client’s risk profile and investment objectives.
Investment style
Our Investment style is best characterised as follows:
- All shares or investments are listed on the Australian Stock Exchange (ASX). We do not deal in derivatives to leverage your portfolio. We can however invest in all listed securities, when appropriate, including warrants, resettable preference shares, ordinary preference shares, listed property trusts etc, as well as the ordinary equities of all companies which meet our investment criteria and are listed on the ASX.
- There are no investment parameters that restrict our capacity to go to cash or debt instruments, where appropriate. We have, at times, held substantial cash positions, to the considerable benefit of our clients.
- We avoid using leverage or other gearing, and we do not short sell or lend scrip.
- Stocks are individually selected to meet our clients’ investment needs.
- Where possible, we hold investments for the long term.
- Strong emphasis is placed on internally developed Risk Management Techniques to allow us to both carefully manage the volatility of portfolios and preserve capital – especially in bear markets.
Investment management network
The network of contacts we have built up since we were established provides:
- Strong relationships with a broad range of leading brokers, analysts and underwriters, and ensures our clients are charged institutional brokerage rates.
- Our clients with the opportunity to participate in new floats and placements and allows us to pass through any underwriting income we receive to our clients.
- Access to a broad range of investment research and analysts.
- Regular and direct contact with the management of listed companies.
