The secret to consistent success in the stock market is to have a sound intellectual framework for making investment decisions. There are 3 major elements in our clearly defined investment philosophy that forms our sound intellectual framework.
This is the foundation of our investment style. Our objective is to seek capital appreciation while reducing the margin of error. This is achieved with a rigorous and well-defined value investing approach. We start from a simple premise. As Benjamin Graham advised, "Investing in a stock market is most intelligent when it is most business-like".
Our stock selections are based on divergences between market prices and the underlying intrinsic values of the companies. This way, a margin of safety is built in. The vital goal is to determine the company's value and what is driving the valuation.
Top down/market timing.
Our starting point is unique. Unlike other investment advisers in Malaysia, economic analysis of both local and foreign economies is undertaken. In timing the market, Capital Dynamics analyses three fundamental drivers
Inflation and Interest Rates
Our analysis and timing of the overall equity market are based on various approaches. What makes i
Capital so unique is that our market analysis extends beyond the Kuala Lumpur Stock Exchange to include the NYSE, NASDAQ, Tokyo, Hong Kong and Singapore. At another level, our very comprehensive market analysis also includes other financial markets, like bonds, commodities, etc.
Choice of country/market.
Our research and experience tells us that different countries and markets with different economic, political and corporate structures demand different investment approaches. We believe that our matching of investment approach with the country or market is highly innovative and forms part of our investing framework.
At Capital Dynamics, we study price-earnings ratio, Graham & Dodd, Wilder's RSI, IMF's economic forecasts and much more. No computers, although we use them extensively, or mechanical system or formula can replace human judgement. We believe each approach has its own strengths and weaknesses. We continuously study the various investment approaches and ask how they apply in the local context. Constant innovation and adaptation are made to suit the local environment. Therefore, as a result of our thorough research, we take an intelligently eclectic approach. This provides i
Capital with an unsurpassed edge in identifying investment opportunities for its subscribers.