Using a bottom-up process involves analysing a company to see how strong it is. The managers will look at such issues as whether it can withstand a crisis and try to determine how profitable a firm is.
Given this focus, the oil sector in particular is keeping Schroders’ Jamie Lowry and Ian Kelly particularly busy.
Mr Lowry said he was analysing the oil sector to find potential investments, which has had to endure plummeting oil prices and now cost-cutting drives by the oil groups.
“Since the start of the year we have been going over the oil space with a fine-tooth comb, looking at the oil majors and the service providers,” he said. “We are still waiting; still being patient.”
Mr Lowry said in spite of the falling price of the commodity, the majors’ stock prices had not yet started to drop, and while the service providers’ had seen their shares fall a significant degree, valuations were still not cheap enough in his view.
