One of the more curious things about World Cup fever infecting the planet is the sudden authority by which previous novices now espouse their views and share colourful commentary on a sport that hasn’t been of interest for the prior three years and 48 weeks. For four sweet weeks every... Show More
There is an endless list of risks for investors to consider. But if we acted on every one of them, we’d never stay invested. To help isolate the key risks to consider in the current market, we asked two fund managers what's keeping them up at night right now. Ben... Show More
The Bank Bill – Overnight Indexed Swap (OIS) spread is a keenly watched risk measure in fixed income markets that has experienced a significant widening in recent months, both in Australia and in overseas markets (where LIBOR is the equivalent rate to the Aussie bank bill rate). Show More
Over the past month our leading indicators of the industrial cycle have shown signs of peaking. The real question is whether this suggests the industrial cycle is merely temporarily interrupted and rapid global growth will soon return; whether we are through the fastest phase of acceleration in the cycle, and... Show More
This week it's gold and real yields. A really important thing happened with interest rates in November last year which should be front of mind for investors thinking about gold. It is a reasonably well established understanding that gold prices trade inversely to real yields, and I'll explain why shortly.... Show More
Twenty-six years of uninterrupted economic expansion. Australia’s recent performance is now unmatched in history. While a handful of factors have been key to this outcome, without doubt, the floating of the Australian dollar in December 1983 was one of the most critical. According to former Reserve Bank of Australia (RBA)... Show More
Drawdowns are an inevitable part of investing; even Berkshire Hathaway fell by more than 50% during the GFC. As growth investors, Nick Griffin from Munro Partners, says that it’s important to protect yourself both against stock specific risks, and market risks. Here, he explains their approach. Show More
If Australia has an Achille’s heal it’s the high and still rising level of household debt that has gone hand in hand with the surge in house prices relative to incomes. Whereas several comparable countries have seen their household debt to income ratios pull back a bit since the Global... Show More
Although confronted with a maturing growth cycle and the likelihood of more modest returns, the catalysts typically leading to past downturns appear largely absent - such as sharply tighter monetary or fiscal policy and financial crises. Notwithstanding our sense that 2018 is a year to stay positive, we have highlighted... Show More
As most of you will have noticed, global share markets have been very turbulent, and sharply down this month. Our view is that this does NOT mark the end of the bull market we have seen since we launched the Morphic Global Opportunities Fund in 2012. In consequence, we remain... Show More
Just how risky is the Materials sector? That’s the question we sought to answer as we dive into one of Australia’s largest industries. We use Axioma’s Multifactor Australian Risk Model to map the sector’s risk characteristics, style footprint, as well as the type of investment opportunity it offers investors. Show More
I would like to expand on the “Dirty Secrets fund managers don't want you to know” wire by Lachlan Hughes from of a couple of weeks back. Show More
One of the world’s largest investment managers, Pimco, has been openly talking about de-risking the portfolio. In this short video just published, Group CIO Dan Ivascyn shortlists some of the key risks on their radar, and how they are adjusting the portfolios to be able to weather a recession. Show More
After interviewing leading strategic thinkers I argue in the AFR that there appears to be a 1-in-10 to 1-in-4 probability of full kinetic conflict erupting between the US, South Korea, Australia and North Korea, possibly backed by China, which could turn radioactive, and you had better consider how you can... Show More
Implied volatility is now trading at record lows across a variety of asset classes, especially in US equities. This means that option markets are priced in the belief that the economic and political outlook in America and the world is as stable as it has been for more than 25... Show More
Following on from the popular post on the seasonal turning point for the VIX last week, here's an insight into seasonality for the S&P500. The chart shows 2017 superimposed on the historical average price movement across the year, and it looks like a fairly decent fit, with the implication being... Show More
With markets currently nervous and also expensive, we reached out to a panel of fund managers to ask: “What strategies or techniques allow you to remain invested even if valuations appear stretched?” Read below for individual responses from Nikko AM, Schroders, Monash Investors, and an exclusive interview with Giselle Roux,... Show More
The iconic value investor, and CEO of $27 billion hedge fund Baupost, Seth Klarman, has lived and breathed markets for 35 years. Today he’s nervous. Here are 6 warnings from him that you should keep in mind when investing today. Show More
Today’s news headlines scream about a world of almost unprecedented political and economic policy uncertainty, yet measures of equity volatility are falling. How do we explain this inconsistency? Show More
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
