252. Why emotion is the big enemy of investors

With approximately 41,000 companies listed worldwide, how’s an investor to choose? And once invested, how do you keep your emotions in check? In this interview, Bertrand Cliquet, co-manager of Lazard Global Equity Franchise fund, tells us how this fund’s emphasis on good economic franchises filters that list down to an eclectic mix of just 26 stocks. Bertrand also explains how the process uses a behavioural analysis filter and why the team sticks with a conservative approach to combat inflation and volatility in the markets. What’s covered in this episode: The characteristics that make an ‘economic franchise’Three examples of companies with an economic franchiseThe investment case for Tapestry, the owner of Kate Spade, Coach and Stuart WeitzmanHow a change in management at Tapestry influenced profitsHow the team narrows down its investable universe to just 220 namesWhy emotion is the big enemy of investors The team’s conservative approach to inflation and recessionWhy heightened volatility has provided more opportunitiesRecent rotations in the portfolio Why Covid forced the managers to go back to the fundamentals of medical equipment company MedtronicDoes looming inflation affect the long-term positioning of the portfolio?Why the fund avoids big value sectors such as banks, commodities and oil and gasMore about the fund: The Lazard Global Equity Franchise fund can invest in any business around the world, but because the managers are looking for industry leaders, there is a natural bias towards larger-sized companies. Run by a four-strong team, the managers’ systematic approach to portfolio construction means that behavioural biases should be removed, offering an attractive opportunity in the global equities sector. Learn more on fundcalibre.comPlease remember, we’ve been discussing individual companies to bring investing to life for you. It’s not a recommendation to buy or sell. The fund may or may not still hold these companies at the time of listening. Elite Ratings are based on FundCalibre’s research methodology and are the opinion of FundCalibre’s research team only.Learn more on fundcalibre.comPlease remember, we’ve been discussing individual companies to bring investing to life for you. It’s not a recommendation to buy or sell. The fund may or may not still hold these companies at the time of listening. Elite Ratings are based on FundCalibre’s research methodology and are the opinion of FundCalibre’s research team only.