The Australian team at Fidelity International often draw on influence of legendary Fidelity fund manager, Peter Lynch. But one area that the approach hasn't always worked has been store rollouts. Lynch famously loved a good store rollout as it was predictable growth with limited risk. As Kate Howitt, Portfolio Manager at Fidelity International explains in this week's podcast, this approach runs into a problem in Australia:
"If you try to put that into the Australian market there's a bit of a problem. That is that by the time you're large enough to list, you're probably about halfway through rolling out stores, because our market is so small."
Her approach instead, has been to look for great Australia consumer brands and retailers that can roll their product or store out overseas. In this episode of The Rules of Investing, she shares her thesis on two of these companies. She also discusses her quest to understand what makes a great company, and explains a strange anomaly being created by the combination low rates, easy money, and passive investing.
- 1:35 – Kate's journey to become a fund manager
- 3:26 – Some of the elements that make a great company
- 5:25 – The best and the worst investments she's ever made
- 11:20 – Implications of low interest rates for the financial economy vs the real economy
- 15:01 – Unexpected effects from Quantitative Easing
- 19:17 – How to get comfortable with high valuations
- 22:27 – Kate’s views on Oil Search, Woodside and the energy sector
- 26:29 – Two Aussie companies taking market share overseas
- 34:51 – Kate answers our three favourite questions.
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