Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 184

Ten ways to generate new investment ideas

Generating ideas and gathering information is an ongoing process for our investment team. At Wilson Asset Management, we analyse data from a broad range of sources available to any investor with a keen market interest and a desire to learn. In fact, investors now have an unprecedented amount of information available to them to expand their knowledge base. We generate our investment ideas predominantly from the following 10 sources:

1) Media

The media provides a wealth of information on individual stocks, market themes and economic trends. Our investment team starts each day reading media reports that include local and international news.

Valuable media sources include newspapers (The Australian Financial Review and The Australian), radio (Ross Greenwood’s Money News on 2GB), television (Sky Business News and CNBC) and online platforms (Cuffelinks and Livewire). Market data provider Bloomberg, which is universally used by institutional and professional investors, has free daily email alerts and newsletters available on its website.

2) Market tables and price movements

After the market closes each day, we review share market tables to identify companies with share prices that have reached 12-month rolling highs and lows. In our experience, when a price hits a 12-month high, it can indicate a degree of momentum (particularly in a bull market) that will drive it higher. Conversely, if a company hits its 12-month low, this is often a sign of fundamental company issues and the price is likely to fall further.

If a company reaches its one-year high and we are not already invested, this can be a trigger for us to review the business. Similarly, a sharp share price increase also creates a compelling reason to investigate that stock further.

3) Word of mouth

While company executives can provide a biased perspective, personal and business contacts with knowledge of a company or industry can be more objective. Some of our most illuminating investing insights have come from personal and professional connections such as family, competitors, sell-side analysts and other fund managers.

4) Stock brokers

Stock analyst reports provide valuable and well-researched business insights. If a company is covered by sell-side research analysts, we spend considerable time analysing their reports along with understanding the consensus forecasts. Once we’ve determined what the market anticipates the company will earn, we build this into our modelling.

5) Directors buying

As a general rule, a company’s directors know more than others in the market. Therefore, directors buying shares is a very strong signal about the business. The announcement of a Change in Director’s Interest Notice revealing a company director has substantially increased their holding may prompt us to examine the company further.

6) Observations of a business

Everyday observations can also offer insights into a company. To my wife’s frustration, a visit to a shopping centre becomes a fact-finding mission including quizzing retail staff. Apple’s share price languished for many years until after the release of its portable media player iPod. Around this time, the casual observer would have witnessed thousands lining up to buy the iPod and an increase in foot traffic at Apple stores, however this strong demand was not reflected in Apple’s share price. Apple subsequently sold 55 million iPods, generating US$9 billion in revenue and spurring the share price.

7) Life experiences, behaviours and preferences

Our own life experiences, behaviours and preferences, and those of the people around us, can also reveal a consumer trend, or structural industry change, that leads us to an investment idea.

Last year, I tried to buy a tin of a2 Milk infant formula only to find there was a considerable shortage. This experience demonstrated demand for the product was vastly outstripping supply. This insight was the catalyst to investigate The a2 Milk Company (ASX:A2M) and subsequently invest in it.

8) Company meetings and site tours

Company meetings and visits offer insights into a business such as the quality of management and its culture – both are critical factors to our evaluation of a company (for more, see ‘Why bother with company visits?). Our meetings may also generate investment ideas. For example, an executive’s remark that a certain competitor is giving them a ‘run for their money’ could prompt us to investigate that competitor business as a potential investment.

Any investor can contact a company and ask to meet the CEO or other executives and, while access to executives at larger companies may be limited, micro and small-cap companies should welcome interest from potential shareholders.

Retail investors may also have the option of listening to earnings results teleconferences, giving them the opportunity to interpret the executives’ tone, as well as their words. Larger companies often host investor days for shareholders.

9) ASX announcements

We have found previously undiscovered investment gems through our regular scan of ASX company announcements. Company announcements can be a particularly good source of micro-cap investment ideas during reporting season.

10) Ask a lot of questions

Having a fascination with the market and an inquisitive attitude are indispensable attributes for investors. In my experience, the most successful investors ask a lot of questions and are driven to gain an in-depth understanding of a company, trend or investment theme.

It’s possible to generate a worthwhile investment idea, or a piece of information that leads to one, from a vast range of sources. Some brilliant investment ideas arise from a single, but valuable, insight while others are spawned from a combination of insights. Constantly gathering insights to develop a broader knowledge base and being alive to potential investment ideas is key.

Happy hunting!

 

Chris Stott is Chief Investment Officer of Wilson Asset Management. Disclaimer: Listed Investment Companies managed by Wilson Asset Management invest in A2M.

 

banner

Most viewed in recent weeks

Which generation had it toughest?

Each generation believes its economic challenges were uniquely tough - but what does the data say? A closer look reveals a more nuanced, complex story behind the generational hardship debate. 

Maybe it’s time to consider taxing the family home

Australia could unlock smarter investment and greater equity by reforming housing tax concessions. Rethinking exemptions on the family home could benefit most Australians, especially renters and owners of modest homes.

100 Aussies: seven charts on who earns, pays, and owns

The Labor government is talking up tax reform to lift Australia’s ailing economic growth. Before any changes are made, it’s important to know who pays tax, who owns assets, and how much people have in their super for retirement.

The best way to get rich and retire early

This goes through the different options including shares, property and business ownership and declares a winner, as well as outlining the mindset needed to earn enough to never have to work again.

A perfect storm for housing affordability in Australia

Everyone has a theory as to why housing in Australia is so expensive. There are a lot of different factors at play, from skewed migration patterns to banking trends and housing's status as a national obsession.

Chinese steel - building a Sydney Harbour Bridge every 10 minutes

China's steel production, equivalent to building one Sydney Harbour Bridge every 10 minutes, has driven Australia's economic growth. With China's slowdown, what does this mean for Australia's economy and investments?

Latest Updates

Economy

Why we should follow Canada and cut migration

An explosion in low-skilled migration to Australia has depressed wages, killed productivity, and cut rental vacancy rates to near decades-lows. It’s time both sides of politics addressed the issue.

Investing

Simple maths says the AI investment boom ends badly

This AI cycle feels less like a revolution and more like a rerun. Just like fibre in 2000, shale in 2014, and cannabis in 2019, the technology or product is real but the capital cycle will be brutal. Investors beware.

Property

Australian house price speculators: What were you thinking?

Australian housing’s 50-year boom was driven by falling rates and rising borrowing power — not rent or yield. With those drivers exhausted, future returns must reconcile with economic fundamentals. Are we ready?

Shares

ASX reporting season: Room for optimism

Despite mixed ASX results, the market has shown surprising resilience. With rate cuts ahead and economic conditions improving, investors should look beyond short-term noise and position for a potential cyclical upswing.

Property

A Bunnings play without the hefty price tag

BWT Trust has moved to bring management in house. Meanwhile, many of the properties it leases to Bunnings have been repriced to materially higher rents. This has removed two of the key 'snags' holding back the stock.

Investment strategies

Replacing bank hybrids with something similar

With APRA phasing out bank hybrids from 2027, investors must reassess these complex instruments. A synthetic hybrid strategy may offer similar returns but with greater control and clearer understanding of risks.

Shares

Nvidia's CEO is selling. Here's why Aussie investors should care

The magnitude of founder Jensen Huang’s selldown may seem small, but the signal is hard to ignore. When the person with the clearest insight into the company’s future starts cashing out, it’s worth asking why.

Sponsors

Alliances

© 2025 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.