Essay by sdibUniversity, Bachelor'sA+, November 2005

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Merrill Lynch Investment Manager has several core approaches to their 30-year investment philosophy. Rigorous fundamental analysis of investment, the pursuit of quality investment and the construction of concentrated portfolios are the approaches that are responsible for the success of Merrill Lynch.

Merrill Lynch Mercury's investment philosophies are as follows:

A belief in active management:

Merrill Lynch Investment Managers believes in actively managing portfolio where there is an active approach to all levels of the investment process: stock selection, sectors weightings and asset and geographical allocation.

Commitment to primary research:

The investment process is driven by research where investment managers undertake double responsibilities of fund management and extensive individual research covering markets open to international investment. Managers are also benefiting from a vast range of analysis from brokers where the management has a privileged relationship. Experience and extensive research has provided confidence to commitments to investment decision.

Style flexibility:

In contrast with a restrictive style that might lead to under performance in times of economical change, a flexible approach is practice to accommodate economic circumstances.

Thus in the long run, this flexibility allows consistency in performance over the economic cycle. Flexibility also allows investment in a wide range of stocks which are described as "growth", 'value" or "contra-cyclical"

A strong team approach:

There is a strong emphasis on collective consensus where individual skills are factored into house views and ideas are discussed within teams.

An emphasis on risk management:

A dedicated Performance and Risk management Team monitors all investment performance within the group. To ensure consistency and discipline, a risk control model is implemented where the level of risk in a portfolio is analysed quantitatively

2.Investment Style/Process

Merrill Lynch Investment Managers' Australian Equity investment style can be characterised as a bottom-up stock picker. MLIM approach on stock picking depends on...