Welcome to Hedgehog Capital! My name is Ryan Ang. This is my investment blog and note-taking page where I share what I learnt and my analysis on companies. I am sector and country agnostic, although I have a preference for developed markets due to my familiarity with it. My key goal is capital accumulation and I believe the best way is to grow your capital is to stay invested in the best companies.
How do I define “best”? Typically, I look for companies with high TAM potential, high and sustainable return on capital, trend agnostic (with some exceptions), and strong financial profile (no debt).
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What is my investment approach?
3 simple pillars. (1) Why is this a good business? (2) Are the management any good? (3) Is the price right? These are my guiding principles to selecting good businesses. I aim to be a permanent owner of a great business. I am less interested in finding smart trades, smart guesswork or financial theatrics.
How do I do my research?
Typically, my research begins by understanding the industry. This includes the key players, market structure, and value chain.
Then, I create the historical model. I do not pride myself with complex model. Instead, I pride myself with its simplicity. Typically, my model will only have 5 key components -1) Revenue Build, 2) Income Statement, 3) Balance Sheet, 4) Cashflow, 5) Metrics and Industry.
After building the model, I look at the company 10k, earnings transcript, investor presentation. Sometimes, I may have access to expert transcripts which helps me finetune my understanding. I may also look across quality writers who has previously written on the business as a argument check against my views. Personally, this methodology has helped me ramped up my investment research significantly. But moving forward, I aim to rely less on written papers to avoid biases (confirmation bias).
Lastly, I typically write a deep-dive if there is a good story and multiple insights in my research. Else, I will post my bulleted notes on the industry and company instead. You will note that I do not focus much about valuation. Typically, its about 1 paragraph. I will also rarely talk about macroeconomics (although I was an economics student). Based on my experience, it is hard to build conviction on macro-trends. It is already difficult to predict the path of a company, much more a country.
What can you expect from my blog?
You can expect 1 deep dive every month or 2-3 quick summarized notes about a specific industry and business. I used to enjoy writing deep dives, but feel that perhaps a quick concise analysis of a business focusing on conciseness and metrics like “insights per paragraphs” to be a better use of time for my readers.
