Normally I try and produce the chart before the RBA’s decision but was a little slow this time but it is a little intersting to see the market’s reaction to the RBA’s decision to increase the cash rate to 4.75% and its shown in the chart above…an increase in yields across the all maturities although …
Category Archive: Equities
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Oct 25
Favour Global Equities??? Yes and No
Got a few quotes in the Investor Daily today…click here …the article suggests I favour global equities which I do but I don’t. I’m certainly skeptical of the global equity upside potential but the main basis to my thoughts are that global equity markets have far greater diversification than the Australian market which is really …
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Oct 01
AUD and Parity with USD – only the bulls can maintain it
All this talk about Australian Dollar and US Dollar parity got me thinking about the behaviour of the Aussie relative to other assets, namely the sharemarket. The above chart shows that, with the exception of the first half of 2008 when the the sharemarket was a little more forward thinking than the RBA, there has …
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Sep 04
Active versus Passive net cash flow
I found the above chart in an article at marketwatch.com and it shows the net cash flows of both active and passive managed funds in the US over the last 10 years. As can be seen, whilst passive funds (or index funds) have had positive flows every single year, actively managed funds have had massive …
Aug 30
Simple Economic Update
The month of July saw the return of strong sharemarkets both in Australia and overseas with the first positive monthly performance for four months. This return of confidence was largely due to investors reacting positively to the European Banking stress tests where 92% of European banks tested passed. Alongside of the good sharemarket performance was …
Aug 27
Jonathan Pain slams fund manager benchmarking
Apparently Mr Pain is of the belief that equity managers should have benchmarks that are more aligned with their client’s needs and therefore, as far as I can tell, have more of a cash plus or absolute return benchmark. Perhaps I’ve misinterpreted the report but anyway… …whilst on face value this sounds quite reasonable as …
Aug 25
Fear Creeping Up and may be appearing in Oz
Source: Bloomberg After another down day in US Equities markets we can see the VIX is starting to creep up…it increased overnight by a little more than 7% and currently stands at 27.5. If the VIX is one thing it is certainly volatile. Whilst the chart shows that over the last 12 months the VIX …
Aug 20
The often forgotten risk of active funds management
On Wednesday of this week (18 August), the portfolio management team of 452 Capital announced to Colonial that they are calling it quits (at an undisclosed date) and will no longer be managing their Australian Equity Funds. So of course, the Research Houses downgrade their ratings to Sell, Redeem, Hold etc (we moved to Sell) …
Aug 02
A Need for Style Indices and/or more Style Biased Passive Funds
According to Morningstar, the best performing Australian equities fund over the last 10 years is the Dimensional Australia Value Trust. In this competition of winners, where only the biggest or best have survived, the Dimensional fund has outperformed 44 other funds, including those value giants, Perpetual, Tyndall and Investors Mutual and and different styled behemoths …
Jul 20
More inaccurate analysts
This chart comes from the McKinsey Quarterly from back in April 2010 and shows how inaccurate equity analysts have been when predicting Earnings for S&P500 companies over the last 25 years….basically far too bullish and no where near accurate. So just like the last post, the key learning is to not take too much notice …