1. How to Find Stocks

2. GMG Investing Criteria
1. Economic Moats
2. Market Leader
3. Healthy Financials
4. Rational Valuation
5. Positive Earnings Trend
6. Secular Trends

3. GMG Investing Criteria
1. Economic Moats
– Unique market advantage
– Significant barriers to entry to maintain long run growth
2. Market Leader
– Management theory predicts industry leaders perform
best over time
– Proven business model within industry
– Best positioned for taking advantage of industry growth

4. GMG Investing Criteria
3. Healthy Financials
– Debt coverage/leverage
– Sustained operating margins
– Revenue/NI growth
– CapEx expenditures and reinvestment
4. Rational Valuation
– P/E ratio and Boom/Bust macro context
– EV/EBITDA trading multiple
– DCF, intrinsic valuation

5. GMG Investing Criteria
5. Positive Earnings Trend
– Dividends and EPS
– Earnings trends and analyst expectations
– Understanding causes of revenue growth
6. Secular Trends
– Growth potential of country and industry sector
– Other macro trends e.g. interest rates/commodity prices

6. Top-Down Approach Begins with Macro
Macroeconomic Analysis
1. Current State of Global Economy
2. Global trends
3. Analyze industry of focus
4. Pick industry leaders

7. Top-Down Approach: Current State of Global
Economy
• Current State of Global Economy
– Chinese economic growth slowing
– Recent equity market volatility
– Oil supply glut ~ $32/Barrel
– International policy uncertainty
• Brexit and Grexit
• US Fed roadmap
• Moving exchange rates

8. Brent Crude Price Chart

9. Euro to USD

10. Top Down Approach: Global
Trends
• Global Trends
– Depressed oil prices: Winners and losers
• Favorable consumer trend for net oil importers: Poland,
India, Chile, and Kenya
• Economic uncertainty for net oil exporters: Nigeria, Russia,
and Venezuela
– Appreciating USD relative to other EM currencies
• Positive outlook for manufacturing and export industries
• Decreases purchasing power of citizens
– Chinese economic turbulence
• Slowing GPD growth and signs of financial market
uncertainty plague equity investments
• Government tightening control of financial regulations

11. Movements in ForEx

12. Chinese Non-Performing Loans

13. Top Down Approach: Pick an Industry
• Healthcare Industry Sector
– EM markets have seen a very large growth in
pharmaceutics sales: Brazil, Russia, India, China,
and South Africa
– Rising drug prices are an opportunity for
BioSimilar drugs
– New tech advances: wearable technology,
patentable R&D findings (pipeline)
– Opportunities in generics and hospital facility
development in EM markets

14. Top-Down Approach: Industry Leaders
• Identification Sources
– Bloomberg News
– Wall Street Journal (WSJ)
– Financial Times (FT)
– Seeking Alpha
• Use Bloomberg Industry Market Leaders:
http://www.bloomberg.com/visual-
data/industries/rank/name:market-share

15. Bottom-Up Approch
Finding stocks based on our Investment Criteria
Use various Stock Screeners
1.Bloomberg Terminal Screener*
2.www.4-traders.com Screener
3.finviz.com Screener
4.Reuter Screener
5.Brokers Screener - Interactive Broker’s

16. Bloomberg Terminal: EQS Function
Hit “EQS” then “GO” in the terminal
Why BB Terminal?
• Fancy and Cover broad markets
• ***BB can exclude some interesting
companies if they dont have information.
• LEARN HOW TO USE IT! BB is really powerful.

17. EQS 101

18. Select Regions

19. Select Sectors

20. Save as PDF, Excel

21. Back Testing

22. Alternative way to spot LEADER

23. 4-Trader Screener

24. Relative Strength - Leaders

25. Relative Strength - Leaders

26. Finviz Screener

27. Reuter Screener

28. Reuter Screener

29. Interative Broker Screener

30. Interative Broker Screener

31. Watch Lists

32. Portfolio Management Tools

33. Portfolio Management Tools

34. Portfolio Management Tools