The Fundamentals #9 – Our Investment Approach

In the ninth of our series – The Fundamentals – about going back to the basics of investing in AIM shares for Inheritance Tax (IHT) planning purposes, we look at the Fundamental Asset Management investment approach.

The Fundamental Asset Management investment approach is best described as, stock specific and growth focused, with a value overlay.

Key criteria include:

• IHT qualification (current and ongoing)
• Growth actual and prospective
• Profitability (unadjusted, we have a strong dislike of the fairy tale EBITDA!)
• Cash generation
• Return on Equity
• Management/insider ownership
• Valuation measures
• Size and liquidity – an ability to sell if we need to
• Understanding of the business

Dividend yield is appreciated, but not essential, as small growing companies, generating high returns on equity, should generally have better things to do with their cash than pay it away.

Macro overlay ensuring sector diversification. Research is undertaken by the 2 portfolio managers Chris Boxall and Stephen Drabwell supported by external analysts (former fund managers, private investors and business people).

For more information on Portfolio Construction Methodology, Approach to Stock Picking, Asset Allocation, House Investment Style, and “House Ethos”, or if would like to speak with Stephen or Chris, please do not hesitate to contact our Business Development Manager Jonathan Bramall via email [email protected] or phone 01923 713 894.

For more information about reducing Inheritance Tax by using Business Relief (also known as Business Property Relief) click here.

The Fundamentals Series

• Introducing The Fundamentals series
• The Fundamentals #2: How to use ISAs for Inheritance Tax (IHT) planning?
• The Fundamental #3: The perils of exit fees & support for a client’s estate
• The Fundamentals #4 – What is the Fundamental AIM Inheritance Tax Portfolio?
• The Fundamentals #5 – How to use AIM to stop HMRC taking money from your family?
• The Fundamentals #6: How long do you need to hold a qualifying stock for to receive IHT relief?
• The Fundamentals #7 – 10 reasons to invest with Fundamental Asset Management
• The Fundamentals #8 – Fundamental Asset Management’s Investment Team

Our Educational Webinars also provide plenty of further information.

Fundamental Asset Management
www.fundamentalasset.com