The Barometer Bottom-Up Process
Along with our top-down methodology, we employ a daily screening process across a universe of 71,000 securities. The bottom-up process is designed to proactively identify leading companies across all sectors of the market to ensure that we have a robust set of portfolio candidates to consider.
To do this, we use proprietary criteria designed to identify securities undergoing positive change. The objective is to find companies experiencing business acceleration based on some change in their business model or product offering.
Companies that emerge from our screening process are then subjected to further due diligence to ensure that we fully understand the underlying business model and industry factors. This additional analysis can include activities such as face-to-face management meetings, external research support and internal financial modeling.
Our bottom-up methodology is effectively designed to identify multiple expansion candidates. These are companies that are undergoing positive change in their business, leading to stronger earnings growth than their peers, while at the same time they are operating in a market or sector that is attracting higher earnings multiples.