“GIC has one of the region’s leading equity divisions and provides investment services for a number of regional institutional and high net worth investors. Its operations include conventional and Shariah compliant products, and in both areas the team seeks to produce high investment returns whilst reducing investment risk. The equity division has a long-term commitment to growth through strengthening its professional resources, and catering clients’ investment needs, this includes the use of a dedicated research team which focuses on in-house research”.
Our equity investment process is a combination of ‘top down’ and ‘bottom up’ approaches, which produces an investible universe that is then constantly reviewed and updated to reflect market and fundamental characteristics.
The top-down approach is “thematic” and it analyses general economic and macro trends to identify the major sectors and industries that benefit from key developments. The bottom up approach includes a review of corporate fundamentals, quality and sustainability of earnings, future prospects and outlook for core business, company positioning relative to peers and stock valuation, in addition to key market characteristics like liquidity and ease of entry & exit.
Screening for the inclusion of stocks into our investible universe is a systematic multi-tiered process, that takes into consideration both quantitative and qualitative parameters. The first screening evaluates the size and liquidity of stocks both on an absolute basis, and relative to their respective markets, which helps in reducing the universe from 637 stocks to 200-220 stocks that represent a very meaningful 85% of GCC market cap. This universe is then subjected to further qualitative screening, in terms of financial parameters, that analyze quality and sustainability of earnings, in addition to management competence and track record, yielding a more refined list of <100 stocks. This list is then subjected to a detailed scoring and valuation process to identify favorable investment options.