Michael

Author's details

Date registered: January 28, 2012

Latest posts

  1. Random Thoughts on Cryptocurrencies at a Random time of the year — December 31, 2022
  2. Investment Philosophy … a short primer — June 6, 2022
  3. A Few ESG Investment Thoughts — June 28, 2021
  4. Approaching the Zero bound — May 22, 2020
  5. Worry about Valuations??? … yeah, a bit … — April 24, 2020

Most commented posts

  1. The disappearing credit spread…US now at pre-GFC levels — 6 comments
  2. ASX200 to go through 5000!!! — 4 comments
  3. A Must Read on “The Economic State of Australia” — 4 comments
  4. Tonight should be a turning point…either way — 3 comments
  5. Asset Allocation that considers Asset Weighted Returns — 3 comments

Author's posts listings

Dec 31

Random Thoughts on Cryptocurrencies at a Random time of the year

Categories:

Bitcoin, Crypto, Currency

by

I’m writing this on Boxing Day and unlucky me is recovering from Covid for the second time in 2022 (Week 1 and Week 52) and during this first sentence I think I have sufficient energy to write a few thoughts on cryptocurrency…so here it goes… Two or three years ago I was on stage at …

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Jun 06

Investment Philosophy … a short primer

Categories:

General Investment, Governance, Investment Philosophy, Investment Strategy

by

Everything I do in my day job is in one way or another a function of the investment committee. My roles vary from governance oversight as Chair, keeping consultants and portfolio managers on their toes as an investment specialist independent member, or perhaps I am the consultant who provides advice on portfolio design including asset …

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Jun 28

A Few ESG Investment Thoughts

Categories:

ESG Investing, General Investment, Governance, Risk

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ES Investing Possibly the biggest trend in investing today is the shift towards ES investing. No, that’s not a typo because it is the E (Environmental) and S (Social) factors of ESG investing that are experiencing the greatest focus as humankind faces existential threat from climate change (i.e. E) and numerous social issues, whether racism, …

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May 22

Approaching the Zero bound

Categories:

Fixed Interest, Interest Rates, Investment Strategy, Yield Curve

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I’m always fascinated by the various changes in financial market behaviour and this economic lockdown has created some new behaviours in the cash or money markets not seen before (or that I’m aware of). The chart below shows the performance of 3 cash benchmarks: RBA Cash Rate Target … currently 25bps (Green) RBA Cash Overnight …

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Apr 24

Worry about Valuations??? … yeah, a bit …

Categories:

Asset Allocaton, Economy, Equities, Fiscal Policy, General Investment, Investment Strategy, Portfolio Construction, Risk, US Economy

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The biggest market in the world, often represented by the S&P 500 index, crashed pretty quickly from 24 February reaching its bottom on 23 March. This fall, in US Dollars, was around 34%. Since then, it has bounced back by around 25% after almost 5 weeks … not a bad turnaround, but obviously not back …

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Mar 19

The decline of the Aussie … almost halved in value since July 2011

Categories:

Uncategorized

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The above interactive chart shows what the latest crisis events have invoked on the Aussie dollar. At the time of writing trading around $0.57US which is down from a high in July 2011 around $1.10US … so almost half. Unfortunately for our currency this is what happens when crises occur … investors run to the …

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Mar 19

RBA announces 3yr target of 0.25% and drops cash to 0.25% … & a very strange yield curve

Categories:

Economy, Fixed Interest, General Investment, Government Bonds, Interest Rates, Uncategorized

by

Reaction to 3 year bond price in the first chart below … that’s still a 0.5% yield to maturity. So the RBA are saying they want 0.25% yield to maturity which is a high bond price but only  little bit of interest in the first 5 minutes or so off the bat. Source: Bloomberg A …

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Mar 19

Most markets are mostly efficient most of the time … maybe not so much now

Categories:

Asset Allocaton, Commodities, Economy, Equities, Fixed Interest, General Investment, Interest Rates, Investment Strategy, Portfolio Construction, Uncategorized, Yield Curve

by

Its clearly been a long time since I updated this blog and perhaps this current crisis makes most sense to make a comeback; particularly given I started this blog not long after the worst of the GFC (Jan 2009 to be precise). Anyway, the current crisis has clearly required a global response to slow down …

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May 31

A Few Investment Selection Faux Pas

Categories:

Alternatives, Asset Allocaton, Corporate Bonds, General Investment, Hedge Funds, Investment Strategy, Managed Funds, Portfolio Construction, Risk

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Over the years having worked in consulting and research I have been sent countless portfolios for opinion. Virtually all portfolios have followed a pre-defined asset allocation aligned to a specific risk profile but occasionally that is where the alignment ends. This is because the investments selected bear little to no relationship with their desired characteristics …

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Apr 27

From Asset Allocation to Risk Allocation

Categories:

Asset Allocaton, General Investment, Investment Strategy, Managed Funds, Portfolio Construction, Risk

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Background After capital market forecasts and assessing investor objectives, the current method for portfolio construction starts with the asset allocation decision followed by investment selection. In the Australian financial planning industry, it widely accepted that the asset allocation decision is responsible for most of the portfolio performance variability, and it is, rightly or wrongly, regarded …

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