Unintended consequences of ultra-low interest rates

Auscap Asset Management

Have low interest rates in the major developed world economies caused asset bubbles in the emerging economies around the globe? What might the consequences of this be? Can leverage ratios continue to increase to support growth? What will happen if interest rates rise? How should this affect our thinking about... Show More

The irony of risk

Auscap Asset Management

The irony of risk is that when a risk is most obvious, most discussed and most feared, assets are normally being priced attractively to compensate for that risk. When risk is present but not feared, not apparent or not acknowledged, asset prices typically rise, which can lead to investors receiving... Show More

Recognising investment risks

Auscap Asset Management

Investment risk is the probability or likelihood of loss in relation to a particular investment. In the last newsletter we discussed business risks as some of the most apparent investment risks when purchasing shares of a listed company. But there are plenty of investment risks that are not business risks.... Show More

Dealing with imperfect information

Auscap Asset Management

Investing in the stockmarket must be the perfectionist’s worst nightmare. There is often no clear right or wrong investment. There is never a value equation that can actually be solved. No matter what some might suggest, there is no specific price that accurately values a company, or at least not... Show More

The great debate: dividends vs investment

Auscap Asset Management

In the boardrooms of corporate Australia and across the national press there has been a great debate unfolding. The suggestion is that payout ratios, or the amount of corporate income that is paid to shareholders in the form of dividends, are too high nationally. Apparently many companies are sacrificing future... Show More

Is Now The Time To Buy?

Auscap Asset Management

2016 has started with significant volatility in global equity markets. The Australian market has not been spared, with the ASX200 Index falling 5.48% in January and continuing this declines into early February. In the 11 months ending 31 January 2016, the index was down 15.6% from its monthly closing high... Show More

Is Timing The Market Important?

Auscap Asset Management

Should investors be focused on timing the market? Historically, many successful investors have been quoted as saying that they do not try to time their investments and this has led to the common belief that it is time in the markets that is crucial to success. While we agree that... Show More

The Dangers of Comfortable Investing

Auscap Asset Management

It often feels less risky to be invested in the most widely held stocks… but is this actually the case? By their very nature, these well owned companies are well known, very large and typically well-capitalised businesses. Their size and familiarity offer comfort to the investor and somewhere along the... Show More

To Be, Or Not To Be, Fully Invested

Auscap Asset Management

Where’s the market headed from here? It’s a common question asked, and we are not convinced that anyone will successfully tell you where it will be tomorrow, let alone weeks or months into the future. However it does beg the question – if predicting the direction of the market is... Show More

There's Something About Warren (and Charlie!)

Auscap Asset Management

What makes Warren Buffett truly remarkable is the fact that he is almost unarguably the greatest financial communicator and educator the world has seen. Auscap attended the 50th AGM of Berkshire Hathaway in May this year and our latest newsletter highlights a few of the insights we gleaned. The commentary... Show More

A time to be alert but not alarmed?

Auscap Asset Management

Is it a time to be alert but perhaps not alarmed? We are frequently asked whether or not we consider the share market to be expensive. In our opinion, equities continue to look reasonably priced in absolute terms and attractive relative to alternative asset classes. This is reflected in an... Show More

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