The Rules of Investing
Two consumer stocks making it big overseas

Two consumer stocks making it big overseas

December 6, 2019

The Australian team at Fidelity International often draw on influence of legendary Fidelity fund manager, Peter Lynch. But one area that the approach hasn't always worked has been store rollouts. Lynch famously loved a good store rollout as it was predictable growth with limited risk. As Kate Howitt, Portfolio Manager at Fidelity International explains in this week's podcast, this approach runs into a problem in Australia:

"If you try to put that into the Australian market there's a bit of a problem. That is that by the time you're large enough to list, you're probably about halfway through rolling out stores, because our market is so small."

Her approach instead, has been to look for great Australia consumer brands and retailers that can roll their product or store out overseas. In this episode of The Rules of Investing, she shares her thesis on two of these companies. She also discusses her quest to understand what makes a great company, and explains a strange anomaly being created by the combination low rates, easy money, and passive investing.
 
50th episode special with Hamish Douglass

50th episode special with Hamish Douglass

November 22, 2019

After two years on the air, The Rules of Investing marks its 50th episode with a very special guest; Hamish Douglass, co-founder, Chairman, Chief Investment Officer, and Lead Portfolio Manager of Magellan Asset Management.

In this exclusive, in-depth interview, Hamish opens up about several topics that he rarely discusses. We hear about the first investment he ever made, how he invested his entire personal wealth in a single asset (and why it was so successful), and some of the challenges he faced in the early years of Magellan. He also discusses what it would take to see a pick-up in inflation and how likely he thinks that scenario is, why he’s confident owning US-listed Chinese mainland companies, and the big investment trends he expects to succeed and fizzle out over the coming decade.

Tune in below for this special episode.

Nailing your asset allocation

Nailing your asset allocation

November 8, 2019

 

While most investors focus on picking stocks to drive performance, in reality, this is just a part of it. Research has proven that over the long-term, 85% of your return is determined by nailing your asset allocation, i.e.: the right mix equities, bonds, alternatives, property and cash for your goals. 

In the final part of this three-part mini-series aimed at new investors, I sit down with Andrew McAuley the Chief Investment Officer for Credit Suisse Private Bank in Australia. 

Bringing it all together to complete this series, Andrew succinctly explains what asset allocation is and why it is important to get right. This was an enjoyable interview with an industry luminary, and I hope you find it as useful as I did interesting. 

How to pick stocks like a pro

How to pick stocks like a pro

October 25, 2019

Equities form a core part of most long-term investment strategies; they offer strong long-term returns, but at the cost of higher volatility than many other assets. But how should investors think about their strategy in this important asset class? That’s the topic of this week’s podcast.

In part two of this three-part mini-series, I sit down with Hamish Carlisle from Merlon Capital. Hamish is an excellent communicator, and has written some of my favourite pieces of stock analysis on Livewire this year. The goal is to provide the tools and the background needed to get started investing in equities.

We discuss what makes a great equity investment, some important skills and concepts for new investors to learn, and he talks us through a current practical example of an investment that he thinks is materially undervalued.

Investing: A how to guide (Part 1)

Investing: A how to guide (Part 1)

October 4, 2019

Getting started as an investor is a daunting task. Even for experienced investors, information overload can be a problem, but for the new investor, it’s hard to even know where to look for a starting point. That’s the goal of this special mini-series; to provide a starting point for novice investors to begin their journey.

In this first part of the series, we’ll be discussing issues around personal finance, goal setting, risk and reward, and setting yourself up to get started as an investor. In two weeks’ time, we’ll do a special episode on equity analysis, that I hope will provide the tools required to begin analysing stocks. Finally, we’ll do an episode about portfolio construction and asset allocation – one of the most underappreciated aspects of investing.

If you’ve got any family members or friends that have been asking you about investing, then this is for them. Please consider whether you know anyone who might benefit from this content, and send it their way.

This week’s guest is Phil Richards, Director and Wealth Advisor at Endorphin Wealth, and Founder of Smart Home Deposit, an online tool to help first home buyers save for a deposit.

Podbean.com - superior podcast hosting.

Podbean.com - superior podcast hosting.

September 24, 2019

Welcome to Podbean.com. With Podbean, you can create professional podcasts in minutes without any programming knowledge. Our user-friendly interface allows you to upload, publish, manage and promote your podcasts with just a few clicks of your mouse. Just point, click and execute. How easy is that? Learn more at http://faq.podbean.com. Have a question ? Check out the Podbean.com support center. Happy Podcasting!

Tagliaferro: How the ‘87 crash shaped my philosophy

Tagliaferro: How the ‘87 crash shaped my philosophy

September 13, 2019

Guest: Anton Tagliaferro, founder and Investment Director at Investors Mutual.

Just like in life, an investor’s early experiences can’t help but shape the way they see the world. For Anton Tagliaferro, founder and Investment Director of Investors Mutual, one of those early formative experiences was the infamous ’87 stock market crash. After witnessing the events in New York the night before, Anton and his team tried to guess how far the ASX would fall that day, but even the most bearish analyst in the group was not prepared for the 25% crash that came when the market opened.

“It taught me a very important lesson; on the day of a crash such as that, everything falls. In a crash, everything falls. The good, the bad, and the ugly. But when sanity prevails and the panic subsides, which it does eventually, people do go back to the stock market, but it’s the good stocks that recover. A lot of the crap, all the froth and bubble, which in the boom was in the headlines all the time, a lot of that stuff goes to nothing.”

In the latest episode of The Rules of Investing, we discuss his current views on Australian banks and retailers, how he first developed IML's investment philosophy, and why he doesn't like the ‘value versus growth’ argument.

Catherine Allfrey: Look over the horizon

Catherine Allfrey: Look over the horizon

September 9, 2019

In Australia we’re fortunate to have some very talented women in funds management. Catherine Allfrey is one of them. After a chance encounter at a Wesfarmers event in the late 90s, Catherine was recruited to Colonial First State by Greg Perry – a true ‘Master of the Market’.

This time working with Perry helped to shape her investment philosophy, which seeks to identify those companies that can grow their earnings at a rate higher than GDP. Catherine formed Wavestone Capital in 2006 with her business partners Ian Harding and Graeme Burke with Raaz Bhuyan joining 2014. Today Wavestone manages ~$4.8 billion for institutions and retail clients.

In this video, Catherine discusses the attributes of companies with superior DNA, shares her view on sectors experiencing tailwinds and explains how she is working to bring more women to investing in Australia.

The developed world is on the brink of crisis

The developed world is on the brink of crisis

September 3, 2019

Guest: Donald Amstad, Aberdeen Standard Investments.

Developed economies are at a crisis point, the powers of unconventional monetary policy are exhausted, and markets are just beginning to wake up to this. That’s the sobering assessment on the current state of the global economy delivered by Donald Amstad from Aberdeen Standard Investments

His view is that when developed markets finally crack, there will be serious implications for every asset class and economy. However, those economies where monetary policy remains relatively ‘normal’ will be those best placed to respond. In his view, the emerging markets have more levers to pull when compared to developed markets, where the money printing taps have been turned on and interest rate settings are near zero.

The irony is that during the Asian crisis it was the IMF and central bankers from developed markets that convinced the emerging market governments not to print money and ‘take their medicine.’ Amstad says that this was a cathartic process for these economies, and they are now looking on in bewilderment as the West has resorts to money printing of an unprecedented scale.

The importance of saying “no”

The importance of saying “no”

August 23, 2019

Guest: Joe Magyer, Chief Investment Officer, Lakehouse Capital.

Moving to a new country is no easy task, but doing it while managing a portfolio, completing the exams for the Chartered Financial Analyst designation, and dealing with the challenges of parenthood is truly Herculean. That, however, is exactly what Joe Magyer, Chief Investment Officer of Lakehouse Capital, was doing in his first years in Australia. How did he manage all this? As it turns out, saying “no” can be a critical skill. And not just in time management either, Joe says “no” to a lot of new investment ideas too.

"I've had analysts start before and I've told them, 'look, there's a really good shot that I'm gonna say no to every idea you pitch for the first year. Don't take it personally, you're probably doing really good work, it's just that I'm really choosy.'"

In this week’s episode of The Rules of Investing podcast, he tells us about the similarities and differences between Aussie small caps and global growth stocks, which global tech stocks will continue to grow and whose stars will fade, and why Visa’s new payment splitting function doesn’t pose a significant threat to Afterpay.