Technical Analysis: An Important Tool for Value Investors

Between 2012 and 2014 I had been researching small oil and gas companies throughout Africa, Latin America and the Middle East and had assembled a basket of stocks and bonds issued by low-cost producers in those regions. Oil had started coming off the highs in the earlier part of 2014, but my analysis had shown that even under much lower oil prices, these companies were able to generate sufficient cash flow to pay an attractive return to the bonds or stocks owned. Despite taking unrealized losses on the positions through the year, I had the conviction that they would turn around based on my analysis of the fundamentals.