Value, growth. Why don't we have both?

Large cap Australian stocks are often purchased for their income, franking credit, and defensiveness, but can undervalued growth stocks be found at the big end of town? Matthew Haupt, Lead Portfolio Manager of the WAM Leaders LIC thinks so, however, it requires a different approach to small caps. At the smaller end of the market, growth is driven by stock specific factors, but among large caps, macro plays a much more important role.

“You don’t have the growth in the larger companies, because they’re linked to the fundamental economic backdrop. There’s more of a macro factor built into the larger companies.”

In this week’s episode of The Rules of Investing, we discuss his take on the sustainability of the current rally in iron ore, whether or not the recent RBA rate cuts came in time to stop a recession, and his current views on one of the hottest sectors in the market right now.

Content discussed

• RealVision interview with Stanley Druckenmiller
  

Time stamps

• 1:13 - How global macro traders have influenced Matt's investment philosophy
• 4:23 - What Matt's looking for in an investment, and how it differs between large and small caps
• 7:22 - Generating ideas among Australian large caps
• 9:58 - Matt explains his thesis for his large overweight position in materials
• 15:20 - His view on Trump's Trade War
• 21:27 - Have the RBA rate cuts come in time to prevent a recession?
• 23:47 - The pursuit of monetary policy perfection
• 29:42 - The appeal of gold in the current environment
• 37:12 - Matt answers our three favourite questions