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The Sohn Australia Conference brings together leading fund managers to chose their highest conviction stock in a 10-minute pitch. Here are their 2021 selections with Charlie Munger's wisdom as the star feature.
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All fund managers now claim to take ESG factors into account, but a multi-asset ethical fund will look quite different from a mainstream fund. Faced with low fixed income returns, alternatives have a bigger role.
The ATO's data on SMSF asset allocation is as much as 27 months out-of-date and categories such as cash and global investments are reported incorrectly. We should question the motives of some who quote the numbers.
In this second part on the reader responses with advice to younger people, we have selected a dozen highlights, but there are so many quality contributions that a full list of comments is also attached.
Climate-related companies will experience exponential growth driven by consumer demand and government action. Investors who identify the right companies will benefit from four themes which will last decades.
There is momentum to stop calling inflation 'transitory' but this overlooks deep-seated trends. A longer-term view will see companies like ARB, Reece, Macquarie Telecom and CSL more valuable in a decade.
Infrastructure assets experienced varying fortunes during the pandemic, from less travel at airports to strong activity in communications. On the road to recovery, what role does infrastructure play in a portfolio?
Among the myriad of numbers that bombard us every day, three prices matter greatly to the world economy. Recent changes in these prices help to understand the potential for a global recovery and interest rates.
Hundreds of green hydrogen projects show this energy opportunity is finally being taken seriously. While a cost disadvantage and technical challenges need to be overcome, it promises to deliver a path to net zero.
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Welcome to Firstlinks Edition 436 with weekend update 24
Two recent discussions with retirees demonstrated why policy change is difficult, and why meaningful action demands a politician who can tell a convincing story when faced with the inevitable opposition. Can we implement changes which are good for the nation when powerful vested interests have so many public platforms these days? Plus all the stock picks from the Annual Sohn Conference.Read More.
A surprisingly high percentage of respondents believe 'This Time is Different'. They may be in for a tough time if history repeats as we have seen plenty of asset bubbles before. Do we have new rules for investing?
From the hundreds of survey responses, here is a selection of 100 tips, with others to come next week. There are consistent and new themes based on decades of experience making mistakes and enjoying successes.
An unwanted fiscal drain will fall on generations of Australians who have seen their incomes and wealth stagnate, having missed the property boom and entered the workforce during a period of flatlining real wages.
Whether they know it or not, most investors use of version of a Strategic Asset Allocation (SAA) to create an efficient portfolio mix of different asset classes, but the benefits of rebalancing are often overlooked.
Many of our readers possess decades of investment experience. Let's share your lessons with those starting out, or is this time different, and your Living Years have left you 'prisoner to what you hold dear'?
There have been few times in the past 140 years when investors were willing to pay for more than 30 years’ worth of earnings, yet here we are around 40. This starting point does not augur well for future returns.
Regulatory tightening has wiped US$1 trillion off China’s stockmarket over the past year, but this is not representative of the whole private sector. It is catching up with global practices of supervision of tech.
Stagflation occurs when economic growth slows (stagnation) and prices rise (inflation), and while this scenario has been evident for a while now, is it really the same as the last time, over 40 years ago?
The Melbourne Cup day RBA meeting confirms the cessation of the ‘yield control’ strategy that’s been in place since July. What might this signal for interest rates in the near term?
Investment returns have defied initial expectations set in the early stages of the Covid pandemic, but where to from here? Which asset classes offer the best opportunities?
The Great Retirement could lead to a tighter job market and higher wages. Older Aussies may see greater health risks at work, while others may elect to smell the roses given the experience of the past 18 months.
The Intergenerational Report is an opportunity to talk about ways to a better future, but it is not the one outlined in the paper. It has too many generous assumptions while the budget will always be in deficit.
The forecasts were wrong. In COVID, banks were expected to face falling house prices, high unemployment and a lending downturn. In the recovery, which banks are awarded gold stars based on the better performance?
While the competing structure, ETFs, has increased in size far quicker in recent years, LICs remain an important part of the listed trust sector. There are differences between Traditional and Trading LICs.
Westpac has sent out details of its buy-back and readers have asked for an explanation. It is not beneficial for all investors and whether this one works for some depends on where the bank sets the final price.
The rotation to economic recovery favouring value stocks continues but risks loom on the horizon. What lessons can be drawn from reporting season and what are the trends as inflation appears in parts of business?
Company pricing power will be a crucial competitive advantage in the year ahead. There are signs that inflation could linger, but some companies and industries have the ability to grow their margins.
The Industrial and Logistics sector, via the ongoing rise of e-commerce, has demonstrated resilience through the global pandemic and has become a hot topic amongst both domestic and global investors.
Many financial advisers have left the industry because it costs more to produce advice than is charged as an up-front fee. Advisers are valued by those who use them while the unadvised don’t see the need to pay.
The Design and Distribution Obligations (DDO) come into effect in two weeks. They will change the way banks promote products, force some small funds to close to new members and push issues into the listed space.
Do what you want with your estate but there can be challenges in a court. Older people are vulnerable and they can tell people what they want to hear, but carers can also be successful over family beneficiaries.
The Australian Taxation Office has issued a directive about the top five errors in SMSF annual returns. Although many leave these to an administrator, it's worth knowing what's happening behind the scenes.
Seeking financial advice can be a daunting task and over 80% of Australians do not have a financial adviser. Here are the steps involved in understanding the advice process to encourage more people to jump in.
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.
Sir Frank shares his story, including his journey from war-torn Europe, identifying opportunities, key character traits necessary for business success, and the importance of remaining paranoid yet optimistic.
Jacob Mitchell spent 14 years at Platinum before establishing Antipodes in 2015. He discusses trends he is following, his biggest lessons, LICs versus active ETFs and a stock he will hold for at least 10 years.
Is it more difficult to find stocks to short in a rising market? What impact has central bank dominance had over stock selection? How do you combine income and growth in a portfolio? Where are the opportunities?
Financial repression is suddenly part of our lexicon, but what is it and how can a fixed income fund take advantage of it? And why it is better to manage smaller amounts than multi-billion portfolios.
Harry Markowitz is the 1990 Nobel Laureate and Pensions & Investments Magazine's 'Man of the Century'. For his 94th birthday, he explains the magic moment of his Modern Portfolio Theory and Efficient Frontier work.
Focus on what you're good at. If you have no insights on macro themes or market trends but can spot a great company, that should be your emphasis, while carefully watching entry and exit prices.
Most people have little idea how the machinery of politics works. Companies that donate to political parties say they are a contribution to the democratic process, but they are really a payment for access and influence, as I learned directly from a Canberra lobbyist a few years ago. We get the politics we deserve.
Is this time different? Every week, we face new challenges to our understanding of how investing works. A Bitcoin is worth about US$60,000 versus $1 only 10 years ago. Rivian makes no revenues and manufactures few vehicles and it's now the second-most valuable car maker in the world. Fill in our 'Living Years' survey and pass on the lessons.
There’s this story about a group of US Air Force generals in World War II who try to figure out ways to protect fighter bombers (and their crew) by examining the location of bullet holes on returning planes. Mapping the location of these holes, the generals quickly come to the conclusion that the areas with the most holes should be prioritised for additional armour.
Hi all. Harry here, sitting in Graham’s editor chair (albeit virtually) for a couple of weeks while he enjoys a long-overdue break. Having been a contributor to Firstlinks over the years, it’s very humbling to see the work of so many talented contributors from an editor’s perspective, rather than a writer. I hope you enjoy the thought-provoking pieces on offer in this edition.
House prices have risen at the fastest pace for 33 years, but what actually happened in 1988, and why is 2021 different? Here's a clue: the stockmarket crashed 50% between September and November 1987. Looking ahead, where did house prices head in the following years, 1989 to 1991?
The current standoff between the RBA Governor, Philip Lowe, who plans to keep the cash rate at 0.1% until 2024, and the money market, which sees the bill rate above 1.5% by then, is a rare event. Only one will be right, and borrowers better hope it's Lowe.
When it comes to doing your homework on Exchange Traded Funds, understanding index construction is indispensable and the ideal way to find best-of-breed funds for your portfolio.
Two prominent fund managers with strongly opposing views and techniques. Cathie Wood thinks Tesla is going to US$3,000, Rob Arnott says it's already a bubble at US$750. They debate valuing growth and disruption.
Investors with a consistent investment approach which avoids chasing performance should reap rewards over time. A recent US study reveals a persistent gap between reported returns and what investors actually receive.
COVID was a paradigm shift for thematic ETFs, satisfying investor sentiment toward disruptive trends and sustainable investing while covering almost any theme investors desire. Where do they sit in a portfolio?
Our next article on modern retirement income products looks at Magellan's FuturePay. It aims to provide predictable income without having to sell down capital, but at its heart, it's an equity fund with added support.
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.
Perpetual Asset Management Australia launches Active ETFs.
appoints Global Head of Investment Management.
Global Sustainable Equity Fund opens door to Australian investors.
It’s common practice for LICs to issue ‘free’ options with their initial public offerings to offset the effect of listing costs on NTA. So, why are LIC options rarely exercised?
Almost every day, there is a new and exciting fintech announcement of the next big thing. Some checks improve the chances of finding the financial services winners.
The advantages of using re-contributions to minimise taxable components within super will dry up after 1 July 2017, but those in a position to make the most of it now, should consider seeking advice and doing so.
There is a small universe of companies on the ASX which are reliable dividend payers over five years, are fairly valued and are classified as ‘negligible’ or ‘low’ on both ESG risk and carbon risk.
Warren Buffett explained why he believes most investors should not pick stocks but simply own an S&P 500 index fund. "There's a lot more to picking stocks than figuring out what’s going to be a wonderful industry."