Growing Rich - Arabictrader.com

KIRK KAZANJIAN
once underfollowed, given its then-remote location in the Pacific
Northwest. Now it is viewed as a play on one of the fastest growing
areas of the country.” Although her views are subject to change,
Bramwell is concentrating on the following investment themes, which
she believes will benefit from the continuation of a slow-growing
economy into the next millennium:
• Financial services. “This industry enjoys favorable demographics
as aging baby boomers expand the market for financial
products. Economies of scale and technology favor consolidation.”
• Geographic plays. “The Pacific Northwest is growing faster
than the rest of the United States as technology companies, in
particular, expand in the region and as trade with the Pacific
Rim grows.”
• Global expansion. “Rising personal income and an expanding
middle class, especially in emerging countries, create opportunities
for global brands.”
• Innovation. “Companies that create their own growth and
markets by introducing new products and services will prosper.”
• Intellectual property. “Companies with proprietary data and
knowledge that can leverage their know-how across various
media [have an edge over the competition].”
• Outsourcing. “The need to improve productivity and global
competitiveness continues to drive outsourcing for manufacturing
components, personnel, and data processing.”
Robert Stovall has a similar list. Looking toward the future, he
predicts the greatest investment themes (or bull’s-eyes) for the twentyfirst
century are environment, health care, energy, and communications,
all of which are powered by advances in technology.
DEVELOPING A CIRCLE OF COMPETENCE
Davis assembles his portfolio by combining top-down themes with
bottom-up stock picking. He has developed what he calls a circle of
competence in the financial services industry, probably because he
grew up working with his dad, who was a well-known insurance
analyst on Wall Street. Davis believes every investor should develop
his or her own circle of competence. In other words, find one or two
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