Sign up for updates

Latest Newsletter > Investor intelligence June 2013
logo
Issue: Dec 2018
NEWSLETTER  
 
BRINGING YOU THE LATEST INVESTMENT KNOWLEDGE


Edition: 17 December 2018

Market Commentary: The return of volatility
 
The aging bull market showed its age in 2018. A correction came in February and, following a rally to a new high, another correction started in October that erased the gains for the year.
 
Volatility clearly returned to financial markets after being abnormally low in 2017. This can be seen in the chart below comparing the VIX Volatility Index to the US S&P 500 Index.

Despite relatively buoyant GDP growth and company profits, particularly in the US, equity markets were beset by a series of headwinds. They included the US Federal Reserve raising interest rates and withdrawing quantitative easing, a US-initiated trade war with China, rising credit spreads, ongoing Brexit turmoil, and Italy’s budget conflict with the EU.
 
Emerging Markets sold off through the year and the popular US technology “FAANG” stocks – Facebook, Apple, Amazon, Netflix, Google (Alphabet) – came under pressure late in the year.
 
Economic growth will be slower next year but a recession seems unlikely at this stage. The market PE ratio has derated through the correction and earnings growth expectations are back to more reasonable levels. For example, the 12-month forward PE ratio for the US S&P 500 Index is around 15x, close to its 10-year average, and earnings per share growth expectations for 2019 are single-digit.
 
Inflation and unemployment are low and real short-term interest rates in the US are around zero, which is not particularly restrictive. However, debt levels are high and the end of quantitative easing puts markets in uncharted territory.
 
The Australian share market has had its own challenges with the Banking Royal Commission putting pressure on the banks – the largest sector of our market. With the Australian housing market already weakening, the RBA will be in no hurry to raise interest rates here.
 
Although conditions remain challenging, sentiment could improve on a successful trade deal or signs that the Fed is becoming less aggressive on interest rate rises. However, volatility is likely to continue.
 
It is worth remembering some words of investment wisdom from one the world’s great investors, the late Sir John Templeton who was famous for being a successful contrarian value investor.
 
Among his 16 Rules for Investment Success are, “When buying stocks, search for bargains among quality stocks” (our underlining), and “Buy value, not market trends or the economic outlook.”
 
The last of his 16 rules was the warning, “Do not be fearful or negative too often.” “To buy when others are despondently selling and to sell when others are greedily buying requires the greatest fortitude and pays the greatest reward.” His advice is simple, but not easy to implement.
 
In an interview with Forbes in 1988 Sir John said, “People are always asking me where the outlook is good, but that’s the wrong question. The right question is, ‘Where is the outlook most miserable?’”
 
To give the last word to Sir John, “Bull markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria.”
 
If you would like to learn more about Sir John’s 16 rules refer to:
https://www.franklintempleton.com/forms-literature/download/TL-R16
 
Marcus Tuck
Head of Equities
Mason Stevens

 

MASON STEVENS CREDIT FUND - 4 Star Morningstar Rating*


Diversify your portfolio and generate income from a fund that has received a 4 Star Overall Morningstar Rating^ and a Superior 4.25 Star rating from SQM Research^^ in its inaugural review.

Investing in an actively managed portfolio of high quality global interest rate securities, the Fund has a track record of low volatility and strong returns and seeks to generate returns in excess of 2.5% above the RBA Cash Rate.

Since inception in May 2013, the Mason Stevens Credit Fund has achieved 5.87%* p.a. to 30 November, 2018 outperforming its benchmark by 3.90% p.a.

To find out more, click here.
Download Mason Stevens Credit Fund PDS & Application

Current Offer
Placer Property - 333 Exhibition Street Property Fund 

Placer Property is proud to offer 333 Exhibition Street Property Fund to investors looking for regular and reliable income flowing from a CBD commercial property asset.
Find out more information about Placer Property Fund
Download 333 Exhibition Street Property Fund PDS & Application


Current Offer
2020 DirectInvest BlueChip Series SMA Portfolio

Your investment in a SMA allows you to own a direct, blue chip share portfolio of Australia's Top 20 ASX listed companies.




 
Find out more about the BlueChip Series SMA

Current Offer
The Loftus Peak Global Disruption Fund
 

Loftus Peak is a global fund manager with a focus on investing in listed disruptive businesses. The fund holdings include large capitalisation names such as Apple, Google and Alibaba, constructed on the basis of strict criteria, to give exposure to some of the best and fastest growing companies in the world at carefully determined valuations. 
 
 
Find out more about Loftus Peak


SOPHISTICATED INVESTORS

We offer a range of services for high net worth individuals.
 
Established in the tradition of 2020 DIRECTINVEST, 2020 Private provides direct access to exclusive investment opportunities for Sophisticated Investors. Our Private Clients can tap into an extensive network of experts who have deep insights into local and international investment markets, which we use to source and assess unique investment opportunities. 

Our team comprises of specialists in the financial markets and advisory disciplines including strategic advice, portfolio management and trade execution.


If you qualify as a Sophisticated Investor and would like to receive our free Daily Market Report please click the buttons below and follow the links.
 
Find Out More
Register for Program

QBE Travel Insurance 
Receive a discount on your premium**


It's that time of the year when we all go into holiday mode. You've booked your flights but whether you are travelling domestically or abroad, don't forget your travel insurance. Travel insurance gives you the peace of mind while travelling.

2020 DirectInvest gives you a
discount** for QBE Insurance policies purchased online via our website. Purchase your policy in minutes for the essential cover you need.
Find Out More
Get a Quote

WEBSITE  |  UNSUBSCRIBE  |   PRIVACY POLICY  |  DISCLAIMER  |   CONTACT US

 

© 2020 DIRECTINVEST 2018
Level 21, No. 9 Castlereagh Street, Sydney, NSW, 2000, Australia
ABN 89 069 774 456, Authorised Representative No 336649.
 

Disclaimers and Other Important Information

2020 DIRECTINVEST is a part of the Mason Stevens group of companies.
*Returns are calculated using the exit price (including sell spread), net of fees, assuming reinvestment of distributions and excludes franking credits. Returns are calculated from the Fund’s inception date of 31/05/13. The Benchmark is the RBA Cash Rate + 3.50% p.a. Past performance is not a reliable indicator of future performance and may not be achieved in the future.
 
2020 DirectInvest Pty Limited (ABN 89 069 774 456) (2020 DirectInvest) is a corporate authorised representative of Mason Stevens Limited (ABN 91 141 447 207, AFSL 351578). Mason Stevens Limited  is the Responsible Entity and the issuer of the Mason Stevens Credit Fund product disclosure statement. 

2020 DirectInvest has provided information in relation to the Mason Stevens Credit Fund for the purpose of providing general advice and information only. The information does not take into account you or your client's personal objectives, financial situation and needs. Please seek specific advice before making a decision to invest in relation to any investment.  

The information is provided in good faith and 2020 DirectInvest and their respective officers do not make any representation or warranty as to its accuracy, reliability or completeness. To the extent permissible by law, 2020 DirectInvest do not accept any responsibility for any error, omission, indirect or consequential loss or damages (whether arising in contract, tort, negligence or otherwise, in any case whether foreseeable or not).

Any information contained herein is subject to change without prior notice by 2020 DirectInvest and 2020 DirectInvest is not obliged to update any information. References made to any third party or their data is based on information that 2020 DirectInvest believes to be true and accurate as at the date of publication but without independent verification. All information provided in this document is correct as of the date of issue.
 
^
The Morningstar Rating is an assessment of a fund’s past performance – based on both return and risk – which shows how similar investments compare with their competitors. A high rating alone is insufficient basis for an investment decision.
© 2018 Morningstar, Inc. All rights reserved. Neither Morningstar, its affiliates, nor the content providers guarantee the data or content contained herein to be accurate, complete or timely nor will they have any liability for its use or distribution. Any general advice or ‘class service’ have been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892) and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. Refer to our Financial Services Guide (FSG) for more information at www.morningstar.com.au/s/fsg.pdf. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Our publications, ratings and products should be viewed as an additional investment resource, not as your sole source of information. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Some material is copyright and published under licence from ASX Operations Pty Ltd ACN 004 523 782 ("ASXO").

^^ The rating contained in this document is issued by SQM Research Pty Ltd ABN 93 122 592 036. SQM Research is an investment research firm that undertakes research on investment products exclusively for its wholesale clients, utilising a proprietary review and star rating system. The SQM Research star rating system is of a general nature and does not take into account the particular circumstances or needs of any specific person. The rating may be subject to change at any time. Only licensed financial advisers may use the SQM Research star rating system in determining whether an investment is appropriate to a person’s particular circumstances or needs. You should read the product disclosure statement and consult a licensed financial adviser before making an investment decision in relation to this investment product. SQM Research receives a fee from the Fund Manager for the research and rating of the managed investment scheme.


Insurance disclaimer

**A discount is applied to QBE’s standard rates when purchased online at 2020 DIRECTINVEST. Terms, conditions and acceptance criteria apply. Cover limits apply as set out in the policy wording. This material contains general information only and may not suit your particular circumstances. Before deciding to acquire any insurance product, you should obtain and consider the relevant Product Disclosure Statement to decide if a policy is right for you. Insurance issued by QBE Insurance (Australia) Ltd ABN 78 003 191 035 AFS Licence 239545. Mason Stevens Asset Management Pty Ltd trading as 2020 DIRECTINVEST ABN (89 069 774 456) is an Authorised Distributor of QBE Insurance.

 
Copyright 2019 2020 DIRECTINVEST

Investments

Australian shares
International shares
Property
Fixed income
Cash

 

Investment products

Managed Funds
Managed Accounts
Superannuation Funds
Wrap Accounts
Insurance Bonds

Strategies

St George Margin Lending
BT Margin Lending
Investment Bond
Sophisticated Investor Opportunities
Self Managed Super Funds

Fund managers

Colonial First State
Perpetual Wealthfocus
BT Investment Funds
MLC Masterkey
Spectrum Super

Australian Fund Managers

Investor Education

Managed investments
Superannuation
Separately managed accounts
Wrap accounts

PRIVACY POLICY  |  TERMS & CONDITIONS SITEMAP

© 2020 DIRECTINVEST 2018   |  A member of Mason Stevens Group |  ABN 89 069 774 456 

Corporate Authorised Representative AR No 336649  | Financial Services Guide