135 results found

Investment grade debt has become much riskier, default rates will rise when interest rates begin the inevitable normalisation, and credit spreads are too low – it’s a bubble waiting to burst. Actually, no.

The long boom in Australian residential property prices seems to have finally ended. Further falls to come will cause the Australian economy to slow but will not cause a recession.

Tim Farrelly | 2 comments | 0.25 CE

The idea that imputation refunds are an unfair, expensive rort is gaining acceptance in the community. The Labor proposal is not fair, nor much of a revenue earner. It's not even nuts. It is just wrong.

The former head of the Australian Stock Exchange recommends that dividend imputation should be abolished?

Investors are entitled to believe that the industry has standards so that they can compare like with like - but obviously that's not the case.

Potential returns on traditional assets are falling and the search is on for different sources of attractive returns. The Australian Asset Backed Loans asset class deserves a place in many portfolios.

Tim Farrelly | 1.00 CE

In the 1950s, Markowitz showed that low or negative correlation is the secret sauce that makes diversification work. While his maths stacks up, the way it is often abused, does not.

Harry Markowitz called diversification "the only free lunch in finance". But it can’t be taken for granted as not all diversification is good. The answer will often lie with good rules of thumb.

Tim Farrelly | 1 comment | 0.25 CE

If US bond rates go higher from here, it is likely to be in response to something we don't yet know, rather than what is already out there. Markets are not nearly as dumb as many suggest.

There is quite a bit happening on the geopolitical front right now to concern markets. With all this uncertainty, the best thing to do is nothing. Sit tight and enjoy the show.

Quantitative Tightening is jangling the nerves of investors around the world. It's unprecedented and so no-one knows for sure exactly how it will play out. But all the evidence points to QT being a non-event.

That's the view that Guy Debelle, Deputy Governor of the RBA, outlined in a recent speech. It's a timely warning - but what do we do with it? I think it depends on your investment time horizon, as do so many investment decisions.

The peddlers of the Bond-cano narrative give very different recommendations. Even if we buy the story, it's just not clear what to do - all of which suggests that it is just a wonderful narrative.

Too much of our communication with end investors is either irrelevant, unintelligible to the average investor - or worse still, both.

Tim Farrelly | 0.50 CE

Global economies and central banks are changing gear. Should you be switching gear with your portfolios? To answer, you need a laser focus on what is important for you.

Tim Farrelly | 0.25 CE

It is the time of the year when those in the forecasting business like to lay out our expectations for the coming year. Here are mine...

"If it is earned here, it should be taxed here" is the title of the ad about laws on multinationals transferring profits offshore. What is interesting is the closing claim in the ad.

The 2017 mid-year SPIVA report on fund manager performance came out recently. And, while we can expect to see the media dwell on the negatives, there are some big positives in the data.

Despite all the talk, the fact that Australian banks loan books are heavily concentrated in low risk residential mortgages should be a source of comfort, not fear.

Simply observing the concentration inherent in the index and reducing Australian Equity weights is throwing the proverbial baby out with the bathwater. It’s nuts and you can clearly see it’s nuts.