WaveStone believes that markets are not perfectly efficient, leading to securities becoming mispriced. As a result we utilise a bottom up stock picing process to add value over the medium term.
The WaveStone investment philosophy is to:
- Identify businesses which exhibit Sustainable Competitive Advantage (SCA) - this is the interaction of a company’s Corporate DNA and the underlying industry dynamics in which a company operates which are expected to deliver above market earnings growth over the medium to long term;
- Exploits inefficiencies whereby the market mis-prices the underlying medium to long term earnings potential.
WaveStone believes that a company with the strongest corporate DNA that operates in the most favourable industry and economic conditions should have the most robust Sustainable Competitive Advantage.