This article is authored by MOI Global instructor Massimo Fuggetta, founder, chairman, and chief investment officer of Bayes Investments, based in London.
Security analysis cannot presume to lay down general rules as to the “proper value” of any given common stock. Practically speaking, there is no such thing.
I hadn’t yet read Ben Graham when, many years ago, I began working as a portfolio manager for a large global asset management company. Their investment process was heavily reliant on the input of security analysts. Each of them followed a number of companies in a certain sector. Their task was to calculate the “proper value” of each stock and condense it into a Dividend Discount Rate.
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About The Author: Massimo Fuggetta
Massimo Fuggetta is the founder, Chairman and Chief Investment Officer of Bayes Investments. Massimo started his investment management career in 1988 at JP Morgan Investment Management in London, where he rose to become Head of the Global Balanced Group, with responsibility for international balanced portfolios. In 1999 he left JPMIM to become Chief Investment Officer, Director General and then CEO at Sanpaolo IMI Asset Management in Milan. He left the company in 2001 to start Horatius, an investment advisory company incorporated in 2004, which in 2007 became an asset management company. He left Horatius in 2012 to go back to London, where in 2014 he founded Bayes Investments.
Massimo holds a Doctorate (DPhil, 1991) and Master’s Degree (MPhil, 1987) in Economics from the University of Oxford. He graduated in Economics at LUISS, Rome in 1984. He taught Behavioural Finance in the Master in Economics course at Bocconi University in Milan in 2000-2002 and in the same period served in the Editorial Board of the Financial Analysts Journal.
In 2012 Massimo started the Bayes blog at www.massimofuggetta.com, which has acquired popularity in the Value Investing community.
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