Jim Slater (March 13, 1929, Cheshire, UK-November 18 2015) was known by his pen name “The Capitalist,” where he wrote regular columns in London’s The Sunday Telegraph.
Jim Slater invented the price-earnings to earnings-growth ratio (PEG), which he made known through his column and his book “The Zulu Principle” (1992).
Slater started his career as a chartered accountant and then a corporate manager.
He held a number of positions from 1953 through 1963 at a various UK manufacturing companies the last of which was Leyland Motor Corporation.
In 1964, Jim Slater partnered with Peter Walker and the two found an investment company called Slater Walker Securities. It was here that Slater became famous in the UK for hostile corporate takeovers.
Five years later Slater Walker was a significant financial conglomerate, and the firm grew to become an investment bank.
But the sharp recession of 1973-74 would see the collapse of many firms, including Slater Walker Securities. Jim Slater was soon declared personally bankrupt.
Jim Slater, however, managed to make a come back which was a credit to his private financial investing acumen and his financial writings.
Through his new advisory service “Company REFS” Jim Slater was able to establish himself as an investment guru.
Key Positions held by Slater included;
Leyland Motor Corporation
Slater Walker Securities
BioProjects International PLC
Galahad Gold PLC
Jim Slater invented the price-earnings to earnings-growth ratio (PEG)
Jim Slater explained his investment strategy in his weekly column.
He tended to like small growth companies, particularly the ones he believed were undervalued by the market.
The investment matrix Slater would use to seek out these stocks would be the PEG ratio, which combines growth and value investing by comparing a company’s price-earnings ratio against its expected earnings per share growth rate.
So long as a stock had a high earnings growth a stock’s P/E ratio the stock was not too expensive and represented value.
The term “Asset stripping” was also popularized by Jim Slater, which referred to the acquisition and subsequent disposal of company assets, a practice that many viewed as unnecessarily or overly harsh in terms of costs to company employees.
Most leading brokers cannot spare the time and money to research smaller stocks. You are therefore more likely to find a bargain in this relatively under-exploited area of the stock market – Jim Slater
Jim Slater’s column, books, and publications provided investors/traders with learning material.
You get out of an investment what you put into it, so the first decision you have to make is how much time you are prepared to devote to the initial task of acquiring a basic knowledge of investment – Jim Slater
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