Stock selection proves its value

01 April 2020

As equity markets continue to react to the growth shock from the Covid 19 pandemic, quality stock selection is as important as ever. Whether you are trying to protect your wealth from the market disruption or position for a recovery once the crisis is over, knowing what to buy and when to be invested is essential.

Goodbody launched Best 8 - our select list of preferred stocks - one year ago on behalf of clients who wanted to own a selection of potentially outperforming shares but lacked the resources to make properly researched and well-timed choices.

The portfolio has proven its value already. The performance of Best 8 prior to the coronavirus pandemic was already well ahead of popular benchmarks, hitting 10% return seven months after going live in April 2019, despite the added volatility caused by issues such as Brexit and the US-China trade dispute.

That relative outperformance continues today, even as markets grapple with the fastest bear market in history. While the overall market is down nearly 9% in the last year, Best 8 has held its value while other strategies are losing money.*

Our team is still originating some great trading ideas by drawing on the deep resources available across Goodbody. Among the stocks we have held in the portfolio are well-known names such as Disney, Reckitt Benckiser and Man Group. Like all the holdings in Best 8, the strategy is to buy and sell at the optimal time rather than hold for long periods.

Disney has emerged as a digital winner with the recent launch of Disney Plus, its streaming television service, while health and hygiene giant Reckitt Benckiser has had huge demand across its product range. Listed fund manager Man Group has seen its main hedge fund rise by double digits amid the intense market volatility of the last month.

Our investment discipline and active risk controls have so far protected against downside losses in turbulent times and captured substantial gains from positive momentum. Until the Covid 19 sell-off, performance far exceeded our target returns and continues to beat the benchmarks. Although not an exact science, our approach ensures that clients have exposure to benefit from any upside in these one-off scenarios. This suggests Best 8 will continue to perform strongly on both an absolute and relative basis in the months ahead, when having the right allocation will be critical.

* The inception date for Best 8 was 1 April 2019. Performance data quoted for Best 8 is relative to the FTSE All World index from that date.


About Best 8

Best 8 is an equal-weighted stock list representing Goodbody’s top global equity ideas for the next 12 months. The list contains up to eight stock positions in medium to large companies operating and listed in developed markets. For every Best 8 stock position, we target net client returns (i.e. after costs) of 8%+ within 12 months.

Every Best 8 account is managed on a discretionary basis by a member of the Active Trading Desk. This means we make the trading decisions on your behalf, saving you the time and effort required to make well-timed and properly researched investments. Suitable clients can invest in Best 8 on a standalone basis or to complement a diversified portfolio. Both personal and corporate clients can invest in Best 8. A minimum initial investment of €150,000 applies.

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Warning: Nothing presented on this website constitutes investment advice as it does not take into account the investment objectives, knowledge and experience or financial situation of any person. You should not act on it in any way and are advised to obtain professional advice suitable to your own individual circumstances. The value of your investment may go down as well as up. You may lose some or all of the money you invest. Past performance should not be taken as an indication or guarantee of future performance; neither should simulated performance. The value of securities may be subject to exchange rate fluctuation that may have a positive or adverse effect on the price or income of such securities.