In this special "Meet the Experts" series, we asked our MoneyShow experts to speak directly with our readers, discussing their backgrounds, investment strategies, and reviewing their presentations at the upcoming The MoneyShow San Francisco.
Hi, my name is Jim Oberweis. I am president of Oberweis Asset Management. We are a global small cap investment manager based in suburban Chicago, with offices in Chicago, New York and London and we look for undervalued small cap stocks, generally in the growth space.
Our strategies seek to exploit market anomalies that are documented by academics, specifically we seek to exploit close to earnings announcement drift. It’s one of the most persistent market anomalies with abnormal returns that are documented to be quite substantial.
Effectively what we do is poke around countries all over the world looking for companies where there is an inflection point of change, be it in earning surprise, or a new product or a new management team.
We try to exploit human behavioral finance tendencies to be a little slow on reaction to that new news. We found, and academic research backs this up, that it takes sometimes as much as a year for that new information to be reflected in stock prices.
Sometimes it’s because people are anchored in their beliefs and have cognitive biases and other times it’s because of incentive structures for analyst that incent them to continue to downplay estimates as opposed to ramping them up to true expectations.
We offer our services through privately managed accounts for clients with as little as $500,000, or you can invest in our strategies through a no load mutual fund family that’s available like places like Fidelity and Schwab.
We have a truly global team. We have investment specialists. Most of us have MBAs from schools like the University of Chicago, or Harvard, or Northwestern.
We’re a very multilingual team. Our teams speaks Chinese, Japanese, German, and we’re scattered all over the globe, so it helps to find those types of undervalued opportunities.
In my panel sessions I’m going to talk a little bit about cognitive biases, about how to find small cap growth stocks before the rest of the street and why it’s important to look in inefficient asset classes like small caps for when you’re looking for undervalued stocks.
We’ll talk about some of our favorite ideas and we’ll talk about some of our favorite geographies and places to look right now. Thanks again. Look forward to seeing everybody at the upcoming San Francisco MoneyShow.
