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Thursday, 28 January 2021
Recently trending 24 hot stocks and funds for 2021Great new ways the Government helps retireesThe hazards of asset allocation in a late-stage major bubbleFour simple strategies deliver long-term investing comfort Cut it out ... millionaires are not wealthy
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Part of the fund manager's job is to raise money from investors, and with years of practice, a few good stock stories and an educated guess on the future, it's not hard to present well. That's a problem for investors.
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Warren Buffett's investment portfolio gains attention because of his legendary status, but parts of his empire in insurance, railways, metalworking and aircraft suppliers have been damaged by the pandemic.
It's time for equity prices to more closely tie to a company’s underlying near-term earnings trajectory and financial strength. Despite the market trading at record levels, some stocks have been left behind.
No doubt, any reduction or deferral in the SG increase would be received favourably by many. However, early access and lower contributions undermine the foundation of our super system.
This increased focus on affordable housing is welcome but the challenge is that investors typically require ‘market’ rate financial returns. By definition, social housing tenants cannot pay market rent.
Savers are making small decision after small decision that leads them away from investing and closer to outright speculating. Time will tell if this ends in a bloody climax or we all live happily ever after.
Australian major banks reported a decline in financial performance in 2020 but as the impact of the pandemic evolves, the banks maintained a strong focus on customers. Is the renewed market optimism justified?
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Welcome to Firstlinks Edition 392
When we wrote about Robinhood and Reddit investors in June last year, it was not expected that their activities would ramp up to another extreme level. Fuelled by stimulus cheques and social media stories of instant wealth, thousands of new participants are speculating on stocks in a way the market rarely sees.Read More.
A long-time advocate of the merits of generating income by investing in industrial companies rather than bonds or deposits checks his 'mothership' chart for the latest results, and continues to feel vindicated.
Last year's retiree checklist of services available was one of our most popular articles. There are some additions for 2021, and while it can take effort to set them up, they can pay off over the long term.
Microchips are the key battleground in the rivalry between Beijing and Washington because the integrated circuit ranks with the internal combustion engine and electricity as inventions of consequence for everyday life.
At a recent industry panel, superannuation and funds management experts discussed the challenges facing the sector in 2021 and beyond. Investors should know what managers are thinking in growing their businesses.
For investors who have the scale, long-term investment horizon and lack of liquidity requirements, it makes sense to implement an asset allocation that can take advantage of a lack of constraints.
At the start of the 20th century, a 'Gilded Age' for plutocrats created vast fortunes and economic inequality surged. COVID is having the same impact now, but portfolios can be adapted to respond to the opportunities.
We need to think hard about how we work and live in the future. How do governments, health gurus, individuals, politicians, businesses and social groups need to act in 2021, both in dealing with COVID and thereafter?
Despite the wave of optimism currently sweeping markets, some negative factors demand caution. Extraordinarily low interest rates is pushing up equities as investors choose the 'lesser evil' in asset allocations.
The next phase of recovery depends on immunity to COVID and reduced consumer reluctance to engage in normal economic activities. What are the various scenarios and how do they influence a balanced portfolio?
The Retirement Income Review has received criticism for compromising future super balances and not supporting the SG increase. The same result as an increase could be achieved by changing two other policies.
Bonds have been strong performers over many decades and always play a role in defensively-positioned portfolios. There are some basic principles investors should understand such as the types of yield.
While the recent Pfizer announcement deserves optimism, the global life sciences supply chain is likely to create more sustainable profits than those in the highly-competitive vaccine market.
Gold investors enjoyed solid gains in 2020, especially mitigating portfolio losses during Q1 when stockmarket losses were severe. The best-case scenario is built into shares now, but gold will be bid if this changes.
Collectibles are everywhere, from old cars, to sneakers, to wine, to cards and anything old and prized. But even if a collectible once attracted thousands of followers, what happens when the fans lose interest?
The Australian market overall finished flat for calendar 2020, but the pandemic delivered big wins and losses. The companies, sectors and companies you invested in delivered vastly different results.
Buoyed by Australia’s response and emergence from the pandemic and recession, the negative short‑term economic costs and disruption do not detract from the longer‑term positive case for Australian equities.
ETFs have gone from bit player to major force in Australian investing in the space of a few years, and will top $100 billion soon. One of the major providers explains how they bring products to the market.
Many investors focus primarily on the big listed companies but the smaller end in tech, mining and healthcare outperforms through innovation. Many Australian companies are world-leaders in their speciality.
The widespread use of 'millionaire' must stop. Inflation means that the basket of goods and services that cost $1 million in 1960 now requires $15 million. Today, millionaires are not wealthy.
Let compounding do its work. It starts slowly. This is why many of those who start an investment programme (or fitness programme, dietary change, sport, or business) give up in the early stages.
Don't make life difficult for the person trusted to manage your estate. Find the time to arrange your documents, contacts, online accounts and files in a convenient place, including giving them some cash.
Most people pay cursory attention to estate planning, limited to a will and maybe a chat with the children. Those who want to make their intentions clearer and easier for others should check these quick tips.
Financial advice has moved well beyond simply recommending investments, with five major components to quality advice. Helping clients avoid potentially disastrous mistakes is often underestimated.
Although the Aged Care Royal Commission (with Paul Keating) and Budget announcements gave the aged care sector high profile, the welcome 'granny flat' changes came with inadequate extra Home Care Packages.
The Interview Series has proved highly popular with our readers. This year’s collection of 20 interviews for 2020 covers most asset types and is a window into how diversification helps to manage risk.
As people stayed home during the pandemic, a bearish view swept over most property sectors, but many have thrived and prices have recovered rapidly. The best opportunities are in long leases with quality tenants.
Paul Keating is the champion of compulsory superannuation as the central means of funding retirement. In the wake of the Retirement Income Review, he is at his passionate best defending the system, with Leigh Sales.
Company profits have not improved for many years but higher valuations have been driven by falling rates and excess liquidity. Conditions do not suit a value and contrarian manager but here are some opportunities.
The 46th President of the United States, Joe Biden, was sworn in on Wednesday, and we all hope it heralds a new era in US politics. Equally important for markets is the appointment of Janet Yellen as Treasury Secretary and her reputation for spending and economic stimulus. And Australia will be a fascinated spectator as the US and China battle it out for economic supremacy for many years to come.
Two major decisions by the Morrison Government confirm that anyone saving for retirement or a home must make plans in the face of continuous regulatory uncertainty. Policy principles are firm one year and jilted the next. The once-lauded responsible lending laws will be abandoned, and the increases in the super guarantee are looking unlikely.
Back into full swing, this edition includes the resources you need to start your investing and planning for a new year. Stock and fund tips, a retirement investing framework, market outlooks and opinions for 2021, lessons from COVID and a check on the most popular articles from last year. Let's kick off by looking on the bright side of life.
Our final packed edition for the year ... but first, if there is one thing 2020 taught us, it is to expect the unexpected. Although some people like Bill Gates forecast in 2014 that a pandemic on a global scale would hit in future, nobody seriously factored it into investment analysis. And even when COVID-19 struck, most analysts predicted economic doom and market collapses which also proved wrong.
It's already become a cliché to say 2020 was a terrible year to be consigned to the rubbish bins of history and the 2021 return-to-normal will be welcome by all. And indeed, the pandemic turned lives upside down and millions suffered. But it also proved again that for financial markets and capitalism, far from being a free enterprise system where government interference is despised, when the going gets tough, central bankers save the system with a bottomless bucket of cash.
As vaccine success increases amid economic growth optimism, global fund managers are switching into sectors which lost in 2020, such as into small caps, emerging markets, value over growth and less defensive in cash and bonds. Energy is back in favour.
Growth was the place to be through the pandemic while value managers couldn't catch a break. It's the long run that matters but 2020 delivered pleasure or pain for many managers.
On the sidelines of the Morningstar Conference, the Magellan co-founder reflects on the pandemic and which sectors are set to gain and lose. He says we were lucky the pandemic hit when it did (videos and transcripts).
Interest in 'quality' factor ETFs has increased this year, helped by very attractive returns. However, not all ETFs are created alike and there are divergences in portfolio traits which investors can identify.
Investors with heavy allocations to a broad US index should check how much is exposed to tech stocks, especially when valuations look a bit steep. It might be time to reallocate to other sectors or styles.
Risk isn’t something to be avoided altogether. To achieve returns beyond the government bond rate, some level of risk must be accepted. Assessing which risks to take and calibrating them is the investor's challenge.
Chris has many years of experience in building successful wealth management practices.
Noel Whittaker is one of the world's foremost authorities on personal finance.
Phil Ruthven is the founder and director of IBISWorld, Australia's best-known business information, forecasting and strategic services corporation
Paul John Keating is a former Australian politician who served as the 24th Prime Minister of Australia, in office from 1991 to 1996 as leader of the Labor Party.
webinar: The hunt for stable yield: What to expect from commercial real estate in 2021, 24 Feb.
webinar: Global markets and macro update: What can we expect in the year ahead? 17 Feb
bolsters executive team with senior appointment.
Understanding demographics is vital for successful planning and investing for the future. What is happening on population growth, ageing, natural increases, immigration and our role in Asia?
State Street Global Advisors is a pioneer in the Australian ETF market, but aggressive pricing from new rivals has eroded its competitive edge.
As he prepares for retirement, a Chief Investment Strategist from a major global fund manager summarises what he has learned working through five full business cycles. He says it's time to take risk off the table.
Markets have recovered in the last six months but most investors remain nervous about the economic outlook. Morningstar analysts provide four quick tips on how to navigate this uncertainty.
Make sure you're not focussing on minor investment problems while giving short shrift to the game-changers. This pyramid describes the important decisions and it might surprise what comes last.