Roger Montgomery - Montgomery Investments
Roger Montgomery is Chief Investment Officer and founder of Montgomery Investment Management. This followed a successful career as an analyst, strategist, fund manager and public company chairman. He's well-known from his many media appearances and it was a pleasure to welcome him as a guest on this podcast.
We spoke about value investing, and his particular criteria for assessing the quality of a company to invest in.
According to Roger the most valuable asset that you could possibly own is a business that can take very large amounts of retained earnings and reinvest them at very high rates of return.
His examples include ASX:CSL, ASX:REH & ASX:ARB. These are examples of companies that have a competitive advantage that allows them to charge a higher price
without reducing sales.
Think of Tiffany's diamonds. They charge more for diamonds than you would pay for the same diamond on the other side of the street but people continue to cross the road to buy their diamonds because of reputation, because of tradition or the movie - you can't have Audrey Hepburn in Breakfast at Michael Hill - it's always going to be Breakfast at Tiffany's. That's why Roger likes those kinds of businesses and there's a lot of them in Australia.
We discuss:
- Value, growth and momentum investing
- How franking credits affect investment in Australian companies
- Valuing small & micro-cap companies
- The difference between 20th and 21st century companies
- Developing a circle of competence before plunging headlong into markets
- A paradise for introverts - working in funds management
- How technologies that change the world don't necessarily make money for investors.
- Patience during downturns
Roger also mentioned his book. Click on the picture below if you're interested in finding out more.
Portfolio tracker Sharesight tracks your trades, shows your true performance, and saves you time and money at tax time. Get 4 months free at this link
Disclosure: The links provided are affiliate links. I will be paid a commission if you use this link to make a purchase. You will also usually receive a discount by using these links/coupon codes. I only recommend products and services that I use and trust myself.
Shares for Beginners is for information and educational purposes only. It isn’t financial advice, and you shouldn’t buy or sell any investments based on what you’ve heard here. Any opinion or commentary is the view of the speaker only not Shares for Beginners. This podcast doesn’t replace professional advice regarding your personal financial needs, circumstances or current situation.