GARY Top 10: Delivering positive returns in a bear market with yield investing
As economic cycles take over from the stimulus cycle, the bear market cycle is likely to continue into the early part of 2023 as global recession worries spread. Investing in the last four decades has mainly been based on buy and hold strategy due to falling rates. The interest rate in the next decade is likely to average higher than the previous decade. Stimulus over the last fifteen years has eaten into future growth and that means we are likely to experience low growth in the decade ahead.
Global manufacturing has moved into contraction while Central Banks remain in rate hikes and tightening financial conditions into 2023. Elevated inflation and fading growth mean global recession/stagflation worries will continue to rise as consumer spending starts to fade into 2023. Market optimism is mainly based on Central Bank pivot and more stimulus in an elevated inflation environment.
Investing through the cycle means the strategy must accommodate bull and bear market trends while managing risk. At Deep Data Analytics (DDA), we evolve with market trends and manage risk to deliver outperformance in all market cycles. The GARY (Growth At Reasonable Yield) model offers exposure to the best 10 stock ideas that manage growth, value, yield, and risk in the current volatile bear market. The model is managed dynamically using data analytics and will evolve over time with changing macro/microdata.
The GARY Top 10 at the end of Dec 2022
- ASX (ASX: ASX)
- Bega Cheese (ASX: BGA)
- Elders (ASX: ELD)
- Evolution Mining (ASX: EVN)
- Nine Entertainment (ASX: NEC)
- Regis Resources (ASX: RRL)
- Seven Group (ASX: SVW)
- Telstra (ASX: TLS)
- Wesfarmers (ASX: WES)
- Woolworths (ASX: WOW)
Note: DDA may or may not have made changes to the model holdings since the end of Dec. We continue to see the cycles changing and the model portfolios evolving with that.
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10 stocks mentioned
Over 25 years’ experience in the finance/tech industry. Mathan has worked extensively in all parts of the finance sector (i.e. County NatWest, Citi, LIM, Southern Cross, Bell Potter, Baillieu Holst and Blue Ocean Equities). Currently Founder and...
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