[COMMENT: All investors take note! This very interesting story tells us something important about the market index, and it’s failings.]
(22 December 2015, AFR, p28, by Philip Baker)
‘There’s been a changing of the guard for investors in 2015 that looks likely to extend into 2016. Instead of the banks, Telstra and resource companies, which are grappling with falling commodity prices, a lack of earnings and below-trend economic growth, a group of stocks linked to the Asian consumption boom are shooting the lights out.’
‘The problem, however, for most investors is that their superannuation is benchmarked to the major ‘S&P ASX 200 index that is dominated by 10 stocks that are struggling, but account for half of the market cap of the index.
‘It means that unless the four majors, Telstra, BHP Billiton, CSL, Wesfarmers, Woolworths and Macquarie Group do well, a large portion of their super is going to struggle. Only two of the top 10 stocks are in positive territory in the 2015 calender year. Macquarie Group is up 35 per cent and CSL is up 19 per cent, while BHP Billiton, down 37 per cent and Woolworths, down 23 per cent, are the two worst performers.’