From the research desk
Betting on the challenger, not the leader
Abakkus Emerging Opportunities Approach is Abakkus Investment Managers' benchmark agnostic PMS strategy with a bias toward mid and small cap companies. It invests predominantly in businesses clearing at least two of three thresholds, return on equity above 15%, earnings growth above 15%, and a price to earnings ratio below 15, and prefers the second or third player in an industry over paying an abnormal premium for the leader. Positions are typically held for 3 to 5 years.
Five checks before a stock qualifies
Every idea is tested against the MEETS framework, Management quality and capital allocation, Earnings quality, Events and triggers, Timing and price, and Structural size of opportunity, not just growth or valuation alone.
Prefers the challenger over the leader
As a value conscious investor, prefers investing in the second or third player in an industry rather than paying an abnormal premium for the market leader.
No single trait has to be perfect
Companies must clear at least two of three quality and value thresholds, strong return on equity, strong earnings growth, and a reasonable price, rather than needing a perfect score or getting screened out for missing just one.