In 2021 Italian savers have at their disposal an extremely cost-effective investment tool: Alternative PIRs (Piani Individuali di Risparmio – Individual Savings Plans). Like the original PIRs launched in 2017, Alternative PIRs enjoy a significant tax advantage: exemption from capital gains tax after a 5-year holding period. Both also have zero inheritance tax. The substantial […]
Bayes Investments
Made in Italy Fund
INVESTMENT PHILOSOPHY
Markets are not efficient, but continually offer attractive opportunities to active investors who can take advantage of them through diligent analysis of intrinsic value.
Stocks are not bits of paper of a trading game, but represent a fractional ownership of a company, allowing investors to share in the company’s profits.
The Fund selects stocks with the mind-set of a long term investor, who wants to participate in the success of the companies he owns. Its aim is to be a stable shareholder and a point of reference for the best companies in the dynamic Italian Small cap universe.
SELECTION PROCESS
Company screening
Constant search for attractive investment opportunities, through a systematic screening of the Small cap universe based on quantitative and qualitative rules, as well as through taking advantage of bargains offered by market volatility.
Fundamental analysis
Analyses are centred on a direct relationship with top management and regular visits to company headquarters. Selection is based on the history of financial reports and valuation, with emphasis on corporate governance and share ownership.
Valuation
The aim of the valuation work is to estimate the company’s profitability and growth prospects in order to arrive at a reasonable assessment of its intrinsic value.
Selection decision
The Fund selects companies where there is a considerable gap between intrinsic value and market price. The magnitude of such margin of safety determines the size of the position.
Selection monitoring
Once in the portfolio, companies are constantly monitored to ensure the validity of the selection thesis. Position weights are adjusted accordingly.
Deselection decision
The Fund has a low turnover. Positions exit the portfolio once they close their value gap through appreciation, or in order to leave space to more attractive alternatives.
MASSIMO FUGGETTA
Bayes Investments Founder and CIO
Massimo started his career as a portfolio manager in 1988 at JP Morgan Investment Management in London, where he rose to become Head of the Global Balanced Group, with overall responsibility for international balanced portfolios. In 1999 he left JPMIM to become Chief Investment Officer and Director General at Sanpaolo IMI Asset Management in Milan, where in 2000 he became Chief Executive Officer. He left the company in 2001 to start Horatius, which was incorporated in 2004 as an advisory company and in 2007 became an asset management company. He was a founding shareholder, a Board member and the CIO of Horatius. In 2012 Massimo left Horatius and went back to London, where in 2014 he founded Bayes Investments.
Massimo graduated in Economics at LUISS, Rome and holds a Master’s Degree (M.Phil.) and a Doctorate (D.Phil.) in Economics from the University of Oxford (Trinity College). Massimo also taught Behavioural Finance in the Master in Economics course at Bocconi University in Milan and served in the Editorial Board of the Financial Analyst Journal.
In 2012, Massimo started the Bayes blog at www.massimofuggetta.com, which has acquired popularity in the Value Investing community.
