Yesterday, I sent out a short note to investors in the AlphaWealth Prime Small & Mid Cap (AWSM) Fund. In it, I included a snapshot investment case for each of our top ten investments.
Forecasts and valuations are purely subjective and involve many assumptions. Many of these will likely turn out to inaccurate (either too high or too low). Likewise, we are obviously biased as we hold these investments. But, at least we have put our money where our mouth is and placed real capital into these investments too.
I.e. We are bias in this note, but convicted in our positions.
The key, though, is to look beyond the upside that we see in these stocks and see how well the underlying businesses are doing. Therein lies the security. Note how profitable and, in many instances, fast growing the underlying businesses remain despite the economy and the pressure on their share prices.
Share prices will be volatile in the short-term and currently, almost all of them are under pressure, but in the long-term fundamentals are the only thing that matters.
All disclaimers aside, I think you might find the note interesting to work through. I think it does a good job of summarizing my current views on a number of topical small caps.
You can download the note here: AWSM Fund Insights – September 2017 Update