Strategy

The recent sell-off in global markets has seen a dramatic shift in sentiment among big fund managers, especially towards the US stock market.

While the options for cash-less financial transactions continue to expand, the readies in Australian wallets still represent a source of value and aspiration.

A surge in financial information and opinion combined with our inclination to focus on negative news risks making us worse investors: more fearful, more jittery, more reactive, less reflective & more short term. This is potentially harmful to our long-term financial health.

The key lessons for investors from the Global Financial Crisis (GFC) are that: there is always a cycle; while each cycle is different, markets are pushed to extremes of valuation and sentiment; high returns come with higher risk; be sceptical of financial engineering or hard-to-understand products; avoid too much gearing or gearing of the wrong sort; the importance of proper diversification; and the importance of asset allocation.

A poll of National Seniors members found nearly 90 per cent thought the removal of tax credits for retirees was unfair.

You knew before the tournament began that Argentina and Germany were destined for an early exit. You had Croatia down as a dark horse to make a run late into the tournament. And of course, you knew that football, as the English fans are fond of saying, is “coming home”. But what good is that to your portfolio?

Investors, especially retirees, seeking income from their investments have today been cautioned to be aware of ‘fake income’.

When I was first asked to comment about the ALP’s proposed scrapping of franking credit refunds my response was I was “flabbergasted”.

While passive portfolio management is gaining in popularity around the world, in Australia this means having close to a 50% exposure in just fifteen stocks, and around the same exposure to just two sectors (financials and resources), without a consideration of the merits of these investments.

It might be a good moment to talk about risk.

Aussie retirees have a love affair with shares, but not all share portfolios are created equal when it comes to providing sustainable income.

Every time I read about Black Swan events I smile and remember a visit a few years ago to Metung in Victoria’s Gippsland, where almost every bird on the lakes was a Black Swan. Thousands upon noisy thousands of them.

If you ever wanted to find an investment topic that proves investors’ decision making is scarily random, this one might be it.

There are plenty of new investing tools that are out there for the DIY investor. Andrew Main runs us through the 5 investment tools that he can’t live without.

There’s a lot to be said for being a contrarian investor: someone who buys stocks when other investors are scrambling to sell.

We spend a significant amount of time explaining to investors our process for entering and exiting investments. We call this process technical research.

As we approach the end of the financial year, the S&P/ASX All Ordinaries Accumulation Index up 7% slightly below the longer term average of 11%, it is timely to highlight the three key themes that we believe will drive the Australian equity market over the next 12 months.

We believe investors should use whatever tools are at their disposal to try to beat the market, and that fundamental analysis combined with technical analysis has a greater probability of achieving this than one style alone.

At Clime we are keen observers of successful long term investors and follow with interest some broad indicators to help us gauge the temperature of equity markets both locally and internationally.