Investment Process
Nemesis follows a disciplined investment process to optimise stock selection
At Nemesis, we follow a systematic approach to analysing securities for inclusion in our portfolios. This method helps our investment managers build portfolios tailored to each client’s goals and risk tolerance.
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Idea Generation
Long-term economic themes
Quantitative screens
Network of managers and entrepreneurs
Sell-side analyst contacts
Valuation Analysis
The company’s paper trail
Management communications
Proprietary cash flow modeling
Analyst models and feedback
Earnings power and normalised cash flow generation
Use of cash/returns on cash
The sum of the parts valuation
Is the price right at this time? Or do we add the company to our ‘radar’?
Investment Case
Where is the divergence between our analysis and consensus?
Management communications
How will the company achieve its intrinsic value?
How will the fundamentals evolve?
Among the answers could be company re-ratings, management changes, operational improvements and the realisation of unappreciated assets or divisions?
Buying Discipline
We buy in tranches because we will take advantage of early investment opportunities
Portfolio Monitoring
We dynamically integrate relevant new fundamental information
We evaluate the correlation of the names in the portfolio
Selling Discipline
The full valuation has been achieved
Management communications
There are unfavorable changes in the fundamentals
We find better risk/reward opportunities elsewhere
