Investment Process: Idea to Investment Series — Part 1

It is the year 2011, and I had around 1000 GBP. I was not sure what to do with the money apart from using it to buy another new gadget. I decided to invest in the stock market, but I was not sure which company stock to buy. There are thousands of company stocks listed in several exchanges. It is extremely difficult to pick the stock of the right company, and I soon realised that you can get lucky a few times in the investment. The real art of investment involves a good investment process.

I will share my investment process in this article and hope to learn a few more insights from you all.

Phase 1 — Idea Funnel
Starting from an interesting article about a company in FT or WSJ to a podcast, there are several sources which provide me with an idea. SEC 13-F filing of super investors is an invaluable free source of an investment idea.

When I reviewed my investment in the last five years, I found that SEC 13F fillings consistently provided me ideas which passed from idea to investment funnel. In the USA investment managers with more than $100m in assets are required to declare all equity long positions in US holdings in 13F filings. It needs to be filled quarterly, and we can view the change in the portfolio from one quarter to another.