By doing only bottom-up analysis, investors implicitly assume that external factors (the winds and hurricanes of the global economy) have no impact on these cash flows.

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Muhlenkamp mixes top-down and bottom-up analysis.

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's global co-head of emerging markets, Ramin Toloui, says the company uses "bottom-up company analysis" meaning it choose firms to invest in regardless of sector.

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Bottom-up-only analysis worked until it stopped working, as investors discovered during the recent crisis that the global economy can come in additional flavors: bad, horrible, and downright nasty.

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Our team emphasizes internal idea generation, in-depth bottom-up research and independent analysis of each value stock monitored or owned by our clients.

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Instead, investors should take a more holistic approach, mixing bottom-up insights with top-down analysis.

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