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Sunday, 31 May 2020
Recently trending 10 undervalued stocks if you're worried about volatilityBaseline outlook for economic recovery is too optimistic Will our government embrace these three reforms?Welcome to Firstlinks Edition 357Don't invest just for yield: the smarter way to generate income
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The Australian market bounced back last Friday (13th) and Monday (16th) tempting analysts to call the bottom of the coronavirus scare. This is too early as the impact on companies is not yet evident.
Large companies supported and promoted by investment managers, brokers, analysts and investment banks have disappeared quickly sometimes. Retail investors should manage equity risk by diversification.
Anyone with capital gains from property or shares should scan the rest of their portfolio for possible offsetting capital losses, always being wary of the ATO's wash sale provisions.
Anchoring refers to a common human tendency to make judgements based on the first piece of information received. In relation to investing, it makes us focus on irrelevant factors when making decisions to buy or sell equities.
Market performance and outperformance can come from many sources, but the main thing to watch for is that you're not paying high 'alpha' fees simply to achieve market 'beta' returns.
As we approach the end of the financial year, don't put off selling the chronic under-performers that are weighing you and your investment portfolio down. Especially if you need an offset to some taxable capital gains.
If you had to choose one concept to explain to a young person setting out on an investment journey, it should be compounding. While the results are not as spectacular, it's especially relevant when returns are lower.
Despite signs of optimism, market valuations are stretched and recovery is fuelled by government support. Some companies are doing well but stimulus cannot continue to prop up consumers for too long.
The key to investment success from here is the ability to ignore the crowd and the hot stocks. We will then face a once-in-a-lifetime chance to buy cyclical and industrial stocks with significant upside.
Amid the coronavirus-induced turmoil, many quality names are trading at a discount to fair value, according to Morningstar analysts. A smaller list of companies also screen for earnings certainty.
SMSF trustees are concerned about stock market volatility and low interest rates, and they asked six important questions during this seminar on whether gold has a role in their portfolios.
Treasury has finally banned commissions paid to brokers and advisers on LICs and LITs but the exemption from FoFA rules remains for other listed products in the 'real' economy, whatever that is.
The simple message to diversify is not new, but thousands of SMSF trustees focus only on equities and dividends. COVID-19 is encouraging SMSFs to consider different investment strategies.
It is always easier to see the challenges and risks while underestimating ingenuity and positive possibilities. It's likely to be the case this time, too, as long as we move quickly to open economies.