Avoiding costly mistakes: a culture of minimising downside risk
It’s clear from the way the European stock market has recently been reacting to events such as the crisis in the Ukraine or recent European Central Bank policy actions, that short-term volatility is often as unpredictable as it is unavoidable. As bottom-up equity investors, these are not things we at Franklin Equity Group can hope to control. When selecting our investments from among the 3,000-stock universe available in Europe, we focus in on the risks that we can foresee by scrutinising what could go wrong in the business model of a company we’re evaluating.