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9 Aug 2018 (AFR) – ‘Cloud cuckoo land’: Brookes lashed in Myer profit guidance class action

[COMMENT: Some investors are firm believers in particular stocks. Over the years, some investors in Myer Holdings would have been firm believers. Many of these investors ignore warning signs that things are not right, and continue to hold the stock. I am sure there were many investors in Myer throughout time. But some investors would … Continue reading

8 Aug 2018 (AFR) – Lessons from investor’s attempt to claim $11m in share losses against income

[COMMENT: This news story covers a perplexing topic that frequently puzzles (share market) investors and traders – How do we account for the proceeds from trading activities?  Is it regarded as income, or a capital gain? This is a very grey area with accountants offering differing opinions from time to time. This news article reports … Continue reading

3 Aug 2018 (AFR) – Stocks, priced for perfection, are vulnerable to shocks

(3 August 2018, AFR, p29, by John Authers) ‘Whatever else there might be to worry about, US earnings are a source of comfort. This earnings season has picked up very much where the last one left off and was locked into positivity long before Apple’s very strong results this week. At the latest count, according to … Continue reading

3 Aug 2018 (AFR) – Wells Fargo agrees to pay $US2b to end GFC-era mortgage probe

(3 August 2018, AFR, p16, by Hannah Levitt and Kartikay Mehrotra) ‘New York/San Francisco | Ten years after faulty mortgages upended the global financial system, Wells Fargo & Co has agreed to pay $US2.09 billion to settle a US probe into its creation and sale of loans that contributed to the disaster. The long-anticipated penalty, … Continue reading

2 Aug 2018 (AFR) – Stakes are high for passive funds after Faang sell-off

(2 August 2018, AFR, p27, by John Plender, Financital Times) ‘If value investors have been on the rack in recent times, their experience has stemmed, at least in part, from inadequate exposure to Faang stocks — the fabled Facebook, Amazon, Apple, Netflix and Google/Alphabet. Since last Thursday’s spectacular $US120 billion fall in Facebook’s market capitalisation … Continue reading

1 Aug 2018 (AFR) – What professional investors watch for in earnings season

(1 August 2018, AFR, p26, by Stewart Oldfield) ‘Professional investors are clearing their desks and sharpening their pencils ahead of the onslaught of the 2018 reporting season. Over a period of about six weeks managers will first  pore over published data, then participate in follow-up result conference calls and finally meet with the management of … Continue reading

31 July 2018 (TheAge) – Big data backlash: Consumers wise up to Facebook, Twitter

(31 July 2018, The Age, Business, p21, By Stephen Bartholomeus) ‘Last week something, two things really, happened that would have sent a frisson of concern through those monetising “Big Data’’. First, Facebook shares plummeted on Thursday, wiping more than $US120 billion off its market capitalisation. Then, on Friday, Twitter lost 15.5 per cent of its market … Continue reading

28 July 2018 (AFR) – Find your super fund in the top performers

[COMMENT – Regular readers of my comments will know that I always caution about reading too much into the performance of managed funds and super funds, because the performance value and rating can change significantly by simply analysing over a different time period. Especially in the complilcated and poorly defined field of super funds that … Continue reading

28 July 2018 (AFR) – Retirees set to feel the pinch as major banks cut term deposit rates

(28 July 2018, AFR, p3, by William McInnes) ‘Self-funded retirees could face further pressure as the the big four banks look at cutting their already low term deposit rates in order to offset rising funding costs. The major banks are facing increasing funding pressure due to increased funding costs squeezing net interest margins.’ Read more … Continue reading

28 July 2018 (AFR) – Are we ‘mid cycle’ or ‘late cycle’?

(28 July 2018, AFR, p31, by Christopher Joye) ‘I hear a lot of ostensibly smart people relentlessly recite the meme that we are “late cycle”, with the implication that a recession is right around the corner. In this vein, there are many overpaid equity investors spruiking the next financial crisis. That’s interesting given investment-grade credit … Continue reading

21 July 2018 (AFR) – Value investing is consistently being beaten by growth

(21 July 2018, AFR, p48, by Chanticleer) ‘The divergence in performance between the leading fund managers focused on investing for value and those investing for growth is now so entrenched that it may prompt the true believers in value investing to think again. A longer-term analysis of value and growth funds by Lonsec Research prepared … Continue reading

20 July 2018 (AFR) – Selector, Bennelong, Platypus are Mercer’s top three Australian funds for 2018

[COMMENT: Another report on fund manager performance, with the usual warnings: be careful about interpreting these results over particular time windows, and noting that some fund managers cannot repeat their performance year after year.] (20 July 2018, AFR, p15, by: Sarah Turner, Vesna Poljak ) ‘What you didn’t own mattered just as much as what … Continue reading

18 July 2018 (TheAge,SMH) – Dobbed in: ASIC reports rise in ‘bad apple’ financial advisers

(18 July 2018, The Age, Business, p22, Ruth WIlliams) ‘The corporate regulator says it is witnessing a spike in the number of “bad apple” financial advisers dobbed in by their former employers, a “positive development” in a sector notorious for allowing poor performers to move from firm to firm. The Australian Securities and Investments Commission’s … Continue reading

12 July 2018 (AFR) – Value hard to come by in mid-cap market says AFIC’s Mark Freeman

[COMMENT: This article is simply reporting the news, and is NOT advice of any sort, nor is the content endorsed.] (12 July 2018, AFR, p29, by William McInnes) ‘Investors are becoming fed up with “lacklustre” large-cap stocks and are eyeing off mid-cap stocks, according to Mirrabooka Investments managing director Mark Freeman. He said the increased … Continue reading

7 July 2018 (AFR) – Own bitcoin or other cryptocurrency? The ATO is after you

[COMMENT: This article sheds some light on how the ATO views the proceeds from share market trading and investing, and how it should be taxed. Are the proceeds simply “trading income” or capital gains? This is an ongoing grey area, and some accountants will want to treat the proceeds differently to others in their profession.] … Continue reading

2 July 2018 (AFR) – Top equity strategists set out ASX targets for the year ahead

[COMMENT: In my humble opinion, the strategies of the larger fund managers might beokay for them, but perhaps not so for the smaller retail investors. That is, one size does NOT fit all. So this article is interesting reading; but is the content appropriate for retail investors? And the other point to also bear in … Continue reading

25 June 2018 (AFR) – ‘Fools’ paradise’ momentum tests value investors

[COMMENT: This is an interesting article to do with investing, and challenges some of the age-old investing paradigms.] (25 June 2018, AFR, p13, by Jemima Whyte) ‘Buying stocks just because they are expected to continue to rise, the so-called “momentum trade”, is a “fool’s paradise”, according to a global equities fund manager. Causeway Capital’s Harry … Continue reading

23 June 2018 (AFR) – Tax loss selling ‘phenomenon’ another risk for ASX dogs

(23 June 2018, AFR, p24, by Sarah Turner) ‘Blue chip names such as Telstra, AMP, Perpetual and QBE will come under scrutiny over the final trading week of the financial year as investors consider dumping the stocks to crystallise tax losses. TMS Capital portfolio manager Ben Clark said because the market has performed strongly – the … Continue reading

2 June 2018 (AFR) – Could the GFC happen again? These guys should know

(2 June 2018, AFR, p9, by Su-Lin Tan) ’10 years after the GFC’ ‘Conservative bank lending, low interest rates, and tighter access to credit have carved a very different debt landscape to that of the global financial crisis 10 years ago, but there is a risk of complacency around the rise in interest rates, former … Continue reading

30 May 2018 (AFR) – Got less than $1m in assets? Forget a self-managed super fund

[COMMENT: Bah!! Humbug!!    We’ve heard a lot about superannuation and the Productivity Commission report, in recent days, including the so-called performance of funds, and fund performance comparisons. HOWEVER, there seems to be one key flaw in this reporting. The fund performance comparisons appear to be over a 10-year period – from 2009, the end of … Continue reading

24 May 2018 (AFR) – Mass financial adviser exodus puts $900 billion in play

(24 May 2018, AFR, p17, by Alice Uribe) ‘A mass exodus of financial planners over the next five years will put $900 billion of client wealth in play as the reality of tougher educational standards and the fallout from damning royal commission revelations set in. The stunning shift in the industry is a key finding … Continue reading

14 May 2018 (AFR) – Tassos Stassopoulos: The fund manager immersed in emerging market Millennials

[COMMENT: Now this is very interesting. An experienced funds manager being told by an ethnographer that his research methods are all wrong. This supports the views that many chartists and technical analysts have about the methods for selecting investment candidates in the financial markets – that the methods of the majority of professionals in the … Continue reading

14 May 2018 (AFR) – People are fed up with capitalism

(14 May 2018, AFR, p19, by John Authers) ‘ “The facts are clear: all the evidence is that process-driven CEOs are prioritising the bottom line and treating earnings as a key metric. That’s capitalism.” These lines are a summary of the news from the corporate sector in the past few weeks. Yet they will read … Continue reading

11 May 2018 (AFR) – Schroders Martin Conlon sets out the bear case for market darlings

(11 May 2018, AFR, p31, by Sarah Turner) ‘Investing in the current crop of market darlings could be a flawed strategy given their expensive valuations, and the risk that central banks remove their implicit safety net that has emboldened risk taking by investors. That’s the view of that Schroders’ head of Australian equities, Martin Conlon, who singled out some … Continue reading

11 May 2018 (AFR) – ASR strategist Ian Harnett cautious on global stocks

(11 May 2018, AFR, p31, by Jonathan Shapiro) ‘Top London-based analyst firm Absolute Strategy Research says the equity market rally is at risk from a slowdown in China and further tightening of monetary policy by central banks. “If you’re looking for that last hurrah it could happen, but you’re dependent on policymakers getting it right,” ASR’s … Continue reading

7 May 2018 (AFR) – ASX confession season begins on a high note

(7 May 2018, AFR, p22, by Vesna Poljak) ‘The confession season has started on an optimistic note, with most companies able to hold their earnings forecasts, but further downgrades cannot be ruled out as the weather and industry-specific issues detract from reasonably strong economic activity.’ Read more (and see more charts and tables) at … Continue reading

25 Apr 2018 (TheAge) – The questions you need to ask before you pick a financial adviser

(25 April 2018, The Age, Money supplement, p2, Christine Long) ‘A financial planner may enter your life through the recommendation of a friend or family member or an introduction via your bank. But that doesn’t mean you should simply hand your money over. As the Hayne Royal Commission is highlighting some thorough investigation is needed … Continue reading

25 Apr 2018 (TheAge) – One move that would go a long way to fixing financial advice

(25 April 2018, The Age, Money supplement, p1, John Collett) ‘There are no quick fixes to curb recurrences of the shocking revelations at the banking royal commission concerning financial advice. But there is a move you’d think would be obvious: licence planners individually.’ <snipped…> ‘… I recall the experience of a 61-year-old cancer patient. She showed me her … Continue reading

24 Apr 2018 (AFR) – Banking royal commission: The real cost of financial advice

(24 April 2018, AFR, p2, by Jennifer Hewett) ‘The guiding principles for AMP’s remediation program for clients who received dud and damaging financial advice certainly sound reassuring. They include the company’s commitment to “timeliness and transparency” as well as to restoring the client’s financial position. But don’t ever try persuading the hapless clients of AMP’s … Continue reading

24 Apr 2018 (AFR) – AMP adviser’s clients lost a quarter of their super. They don’t know it yet

(24 April 2018, AFR, p6, by Joanna Mather) ‘A husband and wife who rolled their superannuation into an AMP-owned product on the basis of dodgy advice lost a quarter of their money in fees – only they don’t know it yet. AMP has yet to inform the mystery couple of their loss even though the … Continue reading