Saturday, December 25, 2010

Bottom Up

A fund manager that take a "bottom up" investment approach pays most attention to the details of each company that they consider for investment. They will analyse factors such as corporate governance and ability of management, growth prospects and growth 'story', business model, competitors, etc. Bottom up strategists and fund managers will take some consideration of market conditions and economic issues, but their primary focus is on the detailed analysis of securities first. The contrast is "top-down", where by managers base stock selection on their view of the economic outlook (e.g. what sectors may benefit from certain trends, etc).

Synonyms: Security analysis, Stock picking
 
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