About Thematic Investing

There are a lot of investment philosophies and hence lots of investment strategies. There are several principal investment “styles”, such as growth or value. With a few exceptions almost all of the varying philosophies, strategies and styles are valid.

However, over the short to medium term virtually no strategy or style is capable of producing consistently positive returns. This is because the stock market is dynamic. It’s driven by changing economic, political and social factors and how the majority of investors react and adjust their investments in response.

The concept of identifying and acting on investment themes isn’t new and as the term and the process are generally used it’s not even a coherent investment strategy.

Thematic Investing is, I believe, a coherent strategy, or at least it can be. Whether I’ve made it a fully coherent strategy is another matter and speaks more to my abilities than the principles of Thematic Investing.

Thematic Investing focuses on the long term investment outlook, the only time period that I think most of us can succeed in terms of investment results. It is not a “trading system”, it is not effortless and on average it requires more than 20 minutes a week of attention. It also requires the investor to look at the “big picture” of world geo-politics, economic and social trends.

Thematic Investing has two basic, straightforward goals:

  • Average annual returns is excess of inflation
  • Capital conservation

Over the long term end up with positive, real investment returns and keep what you started with and made along the way.

We can and do set all sorts of short term goals in managing our Thematic portfolio, but over time we remain focussed on the reality of what an accomplished equity analyst, Gerald Loeb, called “The Battle for Investment Survival.”

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