Small Value Stocks Returned Nearly 40% More During Periods of Expansive Monetary Policy | 2 stocks we like

Glennon Capital

ASX:GC1, ASX:CMI

New evidence shows "small value stocks returned nearly 40% more during periods of expansive monetary policy than during periods of restrictive policy" (VIEW LINK). Australia is currently experiencing a period of expansionary monetary policy whilst the USA is looking to shift its stance to a restricted monetary setting in September. We believe Aussy Small Caps will be the first to benefit from this favourable monetary setting, whilst also being internationally exposed. We hold (ASX:LOV) which has a strong overseas footprint. Lovisa is a fashion jewellery manufacturer that listed at the end of 2014 at $2.00, and is now trading at $3.33. LOV has operations in 8 countries with over 230 stores and plans for further expansion. (ASX:VTG) on the other hand doesn't have international earnings, but has been a strong winner this year. With strong growth in dividends, EBITDA and revenue, Vita group has been a solid performer. We like the segment and the progression of the business from a small phone retailer to a much bigger business as a result of dynamic management. (VIEW LINK)


2 stocks mentioned

Glennon Capital
Glennon Capital
Fund Manager
ASX:GC1, ASX:CMI

Glennon Capital was founded in 2008 by Michael Glennon. Previously, Michael worked with some of the best institutional small company fund managers in Australia. In 2007, he received the IMCA Money Management Fund Manager of the Year (Small Cap)...

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