While absolute valuation has limited use for timing cyclical bull and bear markets, it does provide insights into market sensitivities to challenging (or indeed positive) economic environments. Added to that, relative valuation can be particularly insightful – especially as a key building block for allocating between asset classes and geographies.... Show More
Howard Marks expressed concerns over a range of different assets and indicators in his last memo, which caused quite a media uproar. So he’s expanded and clarified some of his views. More interesting though, was his change of opinion on Bitcoin. His key quotes from this new memo are below. Show More
The ASX200 has rallied by around 17% since its low on February 11th. Given the mood of anxiety at the time, few could have predicted such an aggressive rally was about to begin. Rates have been a driver, though whether or not lower interest rates justify higher prices is a... Show More
Anton Tagliaferro, founder of Investors Mutual, is sitting on a horde of cash, bumping up against their cash limit of 10% in the large-cap portfolios. He says central bank policies are "verging on the insane," and continue to drive prices higher. "The earnings outlook hasn't improved, PEs have just gone... Show More
Recent research by Montgomery shows that not only are high-quality businesses, running ahead of their intrinsic value. So, too, are the largest names on the ASX, which means long-term investors should approach this market with a degree of caution. Recently, we asked the question: is this problem more acute in... Show More
As part of the recent Contango Asset Management national Investor Roadshow, Chief Investment Officer, George Boubouras, discusses our current macro outlook and why rates will be lower for longer, our view on China, and how current valuations are looking on the ASX. Click on the video player below to watch... Show More
Periods of extreme market turbulence can be unnerving. One of the best pieces of advice for making it through turbulent global markets is to turn off the TV. Listening to dire predictions that the media broadcasts during these periods is what causes some investors to pull out of the market... Show More
According to Bespoke Investment Group the market usually outperforms in the weeks after a sell-off of greater than 5%. “If you're trying to decide what to do this week, maybe Bespoke's chart will help. It gives you a look at what happened in the S&P 500 in the weeks following... Show More
This year Private Equity companies have sold $73 billion of their buyouts to the public, a record amount over a six month period. Lise Buyer, founder of IPO advisory firm Class V Group says “It’s clear that we are currently in an environment of frothy valuations. The insiders – those... Show More
In The AFR I offer Warren Buffett gratis advice on whether he should buy into the major banks, comparing them to his existing bank portfolio (incl. Wells Fargo, U.S. Bancorp, Goldmans, Bank of America, and BNY Mellon). Buffet loves banks with strong returns on assets (RoAs) that command a valuation... Show More
JP Morgan Funds says that “Despite weak 1Q results, earnings should rebound as macro headwinds subside” so “there are still reasons to be optimistic about equities.” Why? 1) Earnings should stabilize as macroeconomic headwinds of a lower oil price and rising USD abate. 2) Despite the dollar, multinationals and large-cap... Show More
The US market has never had such a long period without a rate rise – and if history is any guide – investors should not expect valuations to continue rising when the tightening begins. According to Data compiled by Goldman Sachs, PE Ratios will stop expanding as soon as the... Show More
Janet Yellen, Federal Reserve Chair and one of the most influential people in the financial word, believes stock and bonds are priced at high levels. “I would highlight that equity market valuations at this point generally are quite high,” said Yellen. She also said equities aren’t as high as bond... Show More
Chris Stott, CIO of Wilson Asset Management, says his current portfolio position reflects a cautious view on Australian equity market. “We are still seeing in the overall market downgrades to earnings and the market is trading on a PE above 16x – which is greater than two standard deviations above... Show More
The best way to look at this is to assess market valuation, economic growth and inflation pressures, monetary conditions and investor sentiment. 1) Share market valuations are mostly okay. Sure, measured in isolation against their own history shares are no longer dirt cheap. In fact, forward price to earnings multiples... Show More
