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Roger Montgomery
Companies Of All Sizes Can Produce Better Returns
Added On - 2/24/2017 11:02:47 AM
Do you ever wonder why some funds limit themselves to the leading stocks in an index? So do we.
Video - A Great Display For Carsales
Added On - 2/23/2017 11:15:32 AM
We've had a pleasing reporting season thus far, and Carsales is one of our holdings that produced a great result.
Reviewing Isentia
Added On - 2/23/2017 11:13:05 AM
As many investors have noted, iSentia Limited (ASX: ISD) delivered a poor earnings announcement yesterday.
Why Our Oil Refineries Are Shutting Down
Added On - 2/22/2017 10:42:40 AM
Back in the 1960s, manufacturing contributed 25% to Australia's GDP. Today, this figure has dropped below 9%, largely due to an inability to compete on cost.
Macquarie Analysts Warn On Rising Debt Wave
Added On - 2/21/2017 11:18:47 AM
Analysts at Macquarie Research, Viktor Shvets and Chetan Seth, have just released an excellent piece titled 'Surfing the debt wave. Don't look down'.
Fulfillment Gives Amazon Yet Another Way To Boost Profits
Added On - 2/20/2017 11:31:42 AM
Amazon never ceases to astound. We've written before about Amazon Prime, and the company's disruptive force wherever it goes. Today, we shine a light on a low-profile Amazon business that has quietly grown into a profitable juggernaut - Fulfillment by Amazon (FBA).
Insperity Reaccelerates
Added On - 2/20/2017 11:29:31 AM
Insperity has been our best long performer in our global portfolios to date, with the stock nearly doubling since we first bought it about one year ago.
The Spectacular Growth Of eSports
Added On - 2/17/2017 11:14:34 AM
eSports is increasingly becoming an area in which video game publishers are trying to gain a foothold.
Video - Review Of Reporting Season
Added On - 2/16/2017 5:12:08 PM
If we look at the overall market, the ASX200 Index is up close to 3% in the first two weeks of February, so across the overall market, the news so far appears to be pretty good. In this video Portfolio Manager Tim Kelley discusses a few stocks held in The Montgomery Fund.
Value Investing Giant Issues A Warning
Added On - 2/16/2017 5:09:13 PM
Seth Klarman's Baupost Group is the world's 11th largest hedge fund. And Klarman, a renowned value investor, has sometimes been compared to Warren Buffett. So when he offers his analysis, it's worth reading. Which is why we're pleased to bring you excerpts from Klarman's latest investor letter.
Apple's Share Price Bounces Back
Added On - 2/15/2017 10:33:08 AM
Investors in Apple stock are being rewarded for their patience by holding on as the share price pendulum swings back from unjustifiably low levels.
Retailers Make Hay While The Sun Shines
Added On - 2/15/2017 10:31:11 AM
Furniture and appliance retailers, like JB Hi-Fi and Harvey Norman, are enjoying their best trading conditions in a decade, buoyed by low interest rates and a renovation boom. Alas, these sunny conditions won't last.
Has Italy's Economy Hit Crisis Point?
Added On - 2/14/2017 1:22:50 PM
These days, most investors looking beyond our shores are focused on the US. But the situation in Europe is also worth watching closely, particularly in Italy - the world's eighth biggest economy - which appears to be in dire straits.
IDP Capitalises On Global Demand For A Good Education
Added On - 2/14/2017 1:19:19 PM
We hold IDP in the portfolios and consider it well placed strategically to benefit from rapidly increasing global demand for high quality tertiary education
Trump Delivers More Bank Dividends
Added On - 2/13/2017 11:44:07 AM
If Trump loosens the shackles of bank regulation, expect a return to the bad old days of 'profit before care', a rally in financial stocks, followed by a more ominous fallout.
Is Social Media Affecting Your Performance?
Added On - 2/10/2017 11:03:44 AM
Is it becoming more difficult to maintain a steady focus in a world of omnipresent social media distractions?
When Directors Sell, Should You Sell Too?
Added On - 2/9/2017 12:26:11 PM
When directors buy or sell shares in their company, most people believe they are sending a strong signal to the market about the firm's prospects. But how strong is the correlation between director trades and share price movements? And should you buy or sell because a director has too? We did some research to get closer to the truth.
It's Getting Tougher Out There For Our Retailers
Added On - 2/9/2017 12:23:00 PM
Recently, we've seen a number of established businesses hit the wall, under the twin assaults of online shopping and the entry of international brands. The bad news is: it's not about to get any easier.
Mr Turnbull, It's Time We Stopped Selling Off The Farm
Added On - 2/8/2017 11:42:17 AM
Malcolm Turnbull is rumoured to be very concerned about Australia losing its coveted AAA credit rating. Politically, it would be a terrible look were it to occur on his watch. Our shaky credit rating reflects the failure of successive governments to deal with our most pressing economic issue - the Balance of Payments Current Account Deficit. And I don't see things changing soon.
Video - To BHP Or Not To BHP?
Added On - 2/7/2017 11:36:05 AM
In this video insight we explain the recent period of under performance of The Montgomery Fund. Why has the index surged ahead and can this continue?
Watch Out For The Market Disruptors
Added On - 2/7/2017 11:23:05 AM
In our globalised, high-tech world, market disruptors - like Aldi, Amazon and artificial intelligence - are coming faster than ever before.
Solving The Prisoner's Dilemma
Added On - 2/7/2017 11:20:52 AM
The Prisoner's Dilemma provides a framework for understanding how to strike a balance between competition and cooperation. It's possible for rival firms in a competitive market to solve the Prisoner's Dilemma, without collusion, and for their mutual benefit. Let's look at how it can be done.
Resmed's Growing Customer Base
Added On - 2/6/2017 12:23:46 PM
We've postured that Resmed has fundamentally changed the US business model in its favour with its Airsense platform. After the release of Resmed's second quarter results for financial year 2017, we explore how it is tracking against this thesis.
Foot Locker: The Next Step
Added On - 2/6/2017 12:06:44 PM
Foot Locker shares have been a very profitable path for investors over the past year.
Looking For Value? Don't Ignore The Large Caps
Added On - 2/3/2017 11:12:54 AM
If a value investor with a long investment horizon had bought Apple shares when the price languished in the $90s, they would be sitting on a 40% to 60% annualised return today. Not a bad return on the largest of large caps that money can buy.
We Don't Need Those Rates To Rise
Added On - 2/3/2017 11:10:26 AM
In terms of household debt to disposable income (187 per cent) and household debt to GDP (125 per cent), Australian householders are vying for gold in the debt Olympics.
The Great Unwind
Added On - 2/3/2017 11:07:17 AM
Although not a front-of-mind issue at present, a potential unwind of the Fed's balance sheet could cause volatility in financial markets in the future.
Apple's Other $25 Billion Business
Added On - 2/3/2017 11:03:39 AM
Despite putting on nearly 40% over the last nine months, we continue to believe Apple is undervalued.
Second-Level Thinking On Australian Banks
Added On - 2/2/2017 12:35:44 PM
Given that bank updates are at best a distillation of the last three months, what can they offer about turning points other than that they have passed?
When Is Quality Ever Cheap?
Added On - 2/2/2017 11:04:43 AM
All investing is value investing. If price is what you pay, value is what you receive. Your job as an investor this year - and every year - is to pay a lower price than the value you get.
Can A Machine Read Company Announcements?
Added On - 2/2/2017 11:01:14 AM
Is there scope to train a machine to extract insights from this type of text data as well as the hard numbers?
Are Small & Mid-Cap Stocks Good Value?
Added On - 1/30/2017 12:50:03 PM
Let me start by making something clear. The best returns will not come from the large-cap blue chips that so many baby boomers are invested in. They are likely to come from the stocks that have been beaten up the most in recent months.
Buyer Beware When Betting On Bendigo
Added On - 1/30/2017 12:48:24 PM
In the nine months to January 2017, Bendigo returned more than 70 per cent to investors. That is, the bank effectively paid investors more than 12 years' worth of dividends in one. For a bank whose underlying business is potentially shrinking, one wonders if these returns are justified.
After Its Plunge, Is McMillan Shakespeare A Bargain?
Added On - 1/25/2017 3:06:39 PM
Since hitting a high of around $15 in mid-2016, McMillan Shakespeare (ASX: MMS) has fallen to around $11. So we conducted some due diligence.
Trialling A New Car Model
Added On - 1/24/2017 12:46:22 PM
Carsales (ASX: CAR) has an indirect investment in carconnect, a site that's trying to disrupt the way new cars are sold in Australia. Many people dislike haggling with dealers, so carconnect has flipped the model to make dealers tender for your business online. Sounds great for buyers right? But what's the potential upside for Carsales?
Better Investment Decisions Using 'Mindfulness'
Added On - 1/23/2017 10:58:46 AM
Investing is a sport for the mind. It requires an enormous amount of training and continual refinement. But, like for any sport, it's not just about the number of hours you put in; it's also about the productivity of the effort.
Warning: There Might Be Bank Pain Ahead
Added On - 1/20/2017 11:54:46 AM
Since early November 2016, owners of Australian bank shares have been heartened to see stock prices rise sharply. But this could be as good as it gets.
Video - Trump Tax Overhaul
Added On - 1/18/2017 3:24:23 PM
With Donald Trump's inauguration just around the corner and tax reform a top agenda item for both the new administration and the Republican-controlled Congress, it is important for investors to consider the implications of the Republicans' proposed overhaul of the US tax code.
4 Key Issues For Bank Shares In 2017
Added On - 1/18/2017 10:46:50 AM
At current levels, we see all the banks as being similarly expensive.
What You Need To Know About Blockchain
Added On - 1/17/2017 3:28:29 PM
Back in 2008, Satoshi Nakamoto conceptualized the first blockchain. The following year, he used it as a core component of the digital currency, bitcoin. Since then, blockchain has become something of a buzz word. So what is it, and why does it matter?
It's Time To Adjust For A Trump Presidency
Added On - 1/17/2017 12:58:34 PM
At Montgomery, we have been considering the potential economic and market consequences of a Trump presidency since the US elections last November - and even before - and have positioned our global funds accordingly.
The Key Investment Trends In FY16
Added On - 1/16/2017 9:46:36 AM
The 2016 financial year saw some significant changes in investment in Australia. There were major movements in relation to global shares, fixed interest, global property and infrastructure, and alternatives. We can learn a lot by looking at where the money flowed.
Irrational Selling Creates Opportunity
Added On - 1/12/2017 2:49:45 PM
Intuitively investors know the principles of buying low and selling high. Each year Dalbar, a US based research firm, conducts their Quantitative Analysis of Investor Behaviour
Farewell 2016, Hello 2017
Added On - 1/11/2017 12:35:18 PM
After no gain, excluding dividends, over the 30 months from December 2013 to June 2016, the Australian All Ordinaries Index recorded a 7.7 per cent bounce in the December 2016 half-year.
Will Higher Rates Trump The Tax Rate Benefit?
Added On - 12/20/2016 12:25:30 PM
Are the potential benefits of a Trump presidency now 'priced in'?
What 2016 Has Taught Us About Investing In Equities
Added On - 12/19/2016 1:43:01 PM
If you know for sure that equities are heading for a fall, then you should not own equities today. But the problem is, you cannot know for sure where equity prices are headed. No one does.
NSW's New Hospital Model
Added On - 12/16/2016 11:08:42 AM
Positive feedback for Sydney's Northern Beaches Hospital has allowed the NSW Government to push ahead with a hospital model that could benefit all stakeholders, including private healthcare operators.
Is It Time To Buy Vocus & TPG?
Added On - 12/16/2016 11:07:09 AM
These telcos are now trading on seemingly attractive multiples. So, is it time to buy?
Tips For Investing In An Uncertain World
Added On - 12/15/2016 11:02:31 AM
Investing is not a simple process. It involves drawing conclusions from incomplete evidence in an ever-changing world. But if we think about how our minds work when confronted by these uncertainties, then we are taking an important step to making better investment decisions.
Should You Invest More In Resources?
Added On - 12/13/2016 2:10:45 PM
If we sort the ASX300 by total return for YTD 2016, we see quite a number of companies have returned more than 100%.
The New Wave Of Super Changes
Added On - 12/12/2016 10:46:31 AM
In May, the Australian Government announced a number of changes to superannuation. It's now confirmed these changes will be legislated, taking effect from 1 July 2017. Let's look at the key changes, and how they might affect you.
Free-To-Air TV Headwinds Blowing Stronger
Added On - 12/12/2016 10:43:47 AM
Ten Network Holdings held its 2016 annual general meeting last week. The news was not great for shareholders, who are witnessing the decline of a once-robust media company.
Aussie Retailers - Could Amazon Go Disrupt You?
Added On - 12/9/2016 3:33:39 PM
Our retailers are about to face a whole new challenge.
Rising Rates Could Send Big Caps Into Reverse
Added On - 12/9/2016 3:25:58 PM
After an extended period in the doldrums, interest rates are finally on the rise. As I've written before, this could have a momentous effect on asset prices.
U.S. Railcar Makers Continue To Backtrack
Added On - 12/9/2016 3:18:52 PM
The recent U.S. shale-oil boom was a boon for U.S. railcar manufacturers. But their fortunes have gone into reverse.
REA At A Low
Added On - 12/5/2016 3:45:38 PM
REA Group is succeeding despite current market conditions, not because of them.
Video - Will The EU Exist In 5 Years?
Added On - 12/5/2016 3:03:41 PM
The UK's left-leaning Guardian conceded this week: 'Across the western democracies, the centre of political gravity shifts erratically but inexorably to the right.' So today we ask whether or not the European Union will continue to exist in five years time.
Does REA Presents REAlly Great Value?
Added On - 12/5/2016 2:56:57 PM
We think REA's prospects have continued to improve, and as discussed recently on the blog we strongly believe this presents a great buying opportunity for long-term investors.
Despite Being Hit For Six, The Signs Are Good For APN Outdoor
Added On - 12/2/2016 2:26:58 PM
Like many other high-quality mid and small caps, its share price was severely smashed. So, what's going on, and is it time to snap up shares at these beaten-down prices?
When Making Forecasts, It's Better To Look Ahead
Added On - 12/2/2016 1:58:05 PM
Habit is a fundamental part of our everyday lives. Most of us take the same route to work each day, eat at our favourite restaurants, and shop at the same stores. The alternative - devising new routines each day - is too mentally taxing. Taking the easy way out is fine for everyday decision-making. But, when it comes to investing, it's a high-risk approach.
The Bellwether Resource Service Stock
Added On - 11/30/2016 11:37:48 AM
Monodelphous Group Limited (ASX: MND) is the bellwether company for the Australian resource service sector.
Quality Inversion
Added On - 11/28/2016 11:05:46 AM
The Australian equity market has been unfriendly to our style of investing recently. We knew before we stepped onto the field that there would be years when we generated very large excess returns and years when we would suffer, but even when you know they will happen, the bad years are always painful when they occur.
VitaGroup Update
Added On - 11/28/2016 11:03:59 AM
We understand many investors have been watching the recent share price action of Vita Group closely.
How Trump's Victory Has Divided The Market
Added On - 11/28/2016 11:00:31 AM
In the fortnight since Donald Trump won the 2016 US presidential election, the US stock market has appreciated more than 3%. But the strong march upwards by the S&P500 belies a divided performance by the companies and industries that comprise the index.
Howard Marks's Seven Lessons For Investors
Added On - 11/25/2016 12:48:28 PM
Howard Marks is the Founder and Co-Chairman of Oaktree Capital Management - which manages funds of around US$100b.
When Companies Ask For Money, Read The Fine Print
Added On - 11/24/2016 11:33:24 AM
Hands up if you read the fine print when you receive a company prospectus. Odds on, your hand is still down.
Isentia's Drop Is An Overreaction
Added On - 11/24/2016 11:31:28 AM
Isentia recently caused the market price for its shares to stumble by more than 25%. So is this an overreaction?
Rising Bond Yields Are Bad For Assets
Added On - 11/24/2016 11:29:02 AM
Right now, many investors are probably patting themselves on the back, having profited from a booming property market and the makings of a resurgent share market. But there is an elephant in the room - rising bond yields. And they could bring the party to an abrupt end.
Video - When Earnings Growth Can Be Bad
Added On - 11/23/2016 11:23:15 AM
Is a company that is able to grow its earnings 20% every year a good company? Your initial thoughts might be that it is a strong level of growth therefore it's likely to be a high quality business. In fact, the answer as to whether this is a good company is maybe.
Scepticism Over Boral's Giant US Acquisition
Added On - 11/23/2016 11:16:59 AM
Boral generated rare headlines this week when it announced an agreed bid for rival US building materials company Headwaters Inc for US$2.564bn. Boral called it a 'strategically compelling acquisition' with 'attractive financial metrics' that will transform the company. But, looking at the history of such take-overs, and the metrics behind the deal, we are not as optimistic.
Asia's Middle Classes Stoke A Digital Revolution
Added On - 11/22/2016 11:10:47 AM
America is still an economic and military powerhouse. But when Donald Trump is inaugurated as America's 45th president in January 2017, he could find it's not so easy to win a trade war with Asia's rising economies, and their growing middle classes.
Is Snap Inc. Reshaping The Path To Augmented Reality?
Added On - 11/22/2016 11:07:26 AM
Last week, bright yellow vending machines began appearing across the U.S. dispensing a small item to great hype: Snap Spectacles.
Are Resource Stocks Worth The Heartache?
Added On - 11/18/2016 12:42:10 PM
If you're an investor in resources companies, you know it's a bumpy, rollercoaster ride, with periods of glee interspersed with periods of gloom. But is all that volatility worth it?
Chances Are 'Low Probability' Is Not 'No Probability'
Added On - 11/18/2016 12:39:57 PM
First, it was the UK who shocked the world in June by voting to leave the European Union. Now, it is the US which has shocked the world by electing Donald Trump as president. Both events were regarded as unlikely. So how do investors deal with this seemingly heightened level of uncertainty?
Video: The Four Horseman Of The Apocalypse
Added On - 11/17/2016 12:43:51 PM
According to the authors Carmen Reinhart and Kenneth Rogoff, the study of eight centuries of financial folly reveals a standard and repeating set of leading indicators to a financial crisis.
Higher Interest Rates & Higher Stock Prices
Added On - 11/17/2016 11:59:47 AM
Can you have your cake and eat it too? It sure looks like it.
Are Airlines Now Extraordinary Businesses?
Added On - 11/16/2016 12:55:50 PM
Warren Buffett is famous for his quips about the folly of investing in airlines, and once labeled the sector a 'death trap' for investors. But now he has changed his tune. What could have prompted this? And does it mean that airlines are now an extraordinary investment?
Australia May Need To Import Natural Gas
Added On - 11/16/2016 10:56:34 AM
AGL Energy, one of Australia's largest generators and retailers of gas, may now be forced to spend $300 million on a gas import facility.
What Do Trades By Insiders Tell Us?
Added On - 11/15/2016 10:59:53 AM
So, should you sell when they sell, and buy when they buy?
Trump Alarmists - The Sky Is Not Falling
Added On - 11/15/2016 10:57:00 AM
In the wake of Donald Trump's victory, I've been hearing a lot of Chicken Little-like fretting about what it means for stock markets and portfolios. So, as investors, how concerned should we be, and what should we be doing to preserve our wealth?


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