Of course, we can debate that notion. Many top investors would say it is better to buy into great companies at decent prices than into those that might recover (or might not). Despite that, the Luke logic lies behind the decision of a New York activist investor, Third Point, to take a stake in the integrated oil major, Royal Dutch Shell (RDSB).
True, Third Point is also approaching Shell from the perspective of ethical investing, or ESG, as it’s now labelled. “Many ESG investors employ a strategy of buying companies that already have a clean bill of health,” it says. But it reckons that “it is often most impactful to invest in companies where the opportunity for positive change is the greatest”; adding that “there is perhaps no bigger ESG opportunity than in big oil and specifically at Royal Dutch Shell”.