Lessons we can take from history during volatile times
It’s been ‘one step forward, two steps back’ for investors just recently – every piece of positive news on the markets is followed in short order by something else to shut down hopes once again. Take a look at the always-important US market in recent weeks. The S&P 500 rose by 2 per cent on…
Why has the RBA raised interest rates for a record 7th month?
Pushing up interest rates isn’t something the Reserve Bank does lightly. But what’s worrying the Reserve Bank – and why it increased interest rates for a record seventh consecutive month on Melbourne Cup Tuesday – is that inflation seems to have become completely detached from the bank’s target band. That target band of 2-3% was…
A fund manager’s guide to turning down the volume
Investment theory is easy. It’s the execution that’s hard. Warren Buffet famously said, “We need to be fearful when everyone else is greedy, and greedy when everyone else is fearful”1. It sounds really simple but it’s actually much harder to execute. Periods of volatility and financial downturn present us with a great opportunity to buy…
Initial Public Offerings in Tough Times
The multitude of new investors in global stock markets may be more susceptible to the siren song spun by the influencers of an upcoming IPO. Key among the lures are the opportunity to “get in on the ground floor.” Sadly, for many investors that ground floor can collapse. Investors are exposed to impressive price gains…
Australia needs a conversation about tax and budgets
Jim Chalmers is a wily operator. Ahead of delivering his first budget next Tuesday, he has given himself room to do the things a treasurer needs to do. For a while, his predecessor Josh Frydenberg denied himself that room. In his first budget as treasurer under Scott Morrison ahead of the 2019 election, Frydenberg promised…
Market love and unfaithfulness
The love of growth is the root of all of evil, including corporate losses, lousy cash flows and inflation. Some companies – and whole economies – are starting to pay the price of their unfaithfulness to sound business principles and economic discipline. The ASX rallied sharply in July on expectations central banks would lose their…
Investment Outlook: Into the unknown
A hard landing looks increasingly likely due to tightening financial conditions, the soaring US dollar, an energy crisis in Europe, and China’s weak economy. Investment implications Winter is coming to the northern hemisphere. With it arrives an energy crisis that will affect much of Europe as the ongoing war in Ukraine severely disrupts the region’s…
China’s deflating property market threatens wider economic trouble
China’s woes could prove to be the global economy’s biggest blow The Reserve Bank of New Zealand a year ago became the first advanced central bank to raise interest rates to cool its economy to tackle inflation. So far, the RBNZ has lifted its key rate seven times. The Bank of England, starting last December,…
Now is the time to myth-bust investment truisms
For pretty much all of my working life, we have been able to hold onto a handful of truisms about investment. Expressions like ‘time in the market not timing the market’ become investment adages because their truth endures through the ups and downs of the cycle. But sometimes, as Jim Callaghan noted about politics in…
Sustainable investing is likely to drive long-term returns
“Expert” investors are more likely to believe that investing sustainably is key to driving long-term returns compared with their peers who rate themselves as less knowledgeable, research by Schroders has found. The finding is from Schroders’ Global Investor Study 2022, the bellwether annual survey which highlights trends based on the answers and opinions of more…
