Australian’s love affair with debt – how big is the risk?

Published: February 15, 2018

Key points Household debt levels in Australia are high compared to other countries and still rising. The rise is not as bad as it looks because its been matched by rising wealth and debt servicing problems are low. However, this could change as interest rates rise and if home prices fall sharply. The trigger for […]

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The pullback in shares – seven reasons not to be too concerned

Published: February 14, 2018

Key points The current pullback in shares has been triggered by worries around US inflation, the Fed and rising bond yields but made worse by an unwinding of bets that volatility would continue to fall. We may have seen the worst, but it’s too early to say for sure. However, our view remains that it’s […]

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Correction time for shares?

Published: February 6, 2018

Key points The US share market is long overdue a decent correction. This now appears to be unfolding and may have further to go as higher inflation, a slightly more aggressive Fed and higher bond yields are factored in. This will impact most share markets including Australian shares. However, in the absence of an aggressive […]

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2018 – a list of lists regarding the macro investment outlook

Published: January 25, 2018

Key points 2018 is likely to remain good for diversified investors. The investment cycle still favours growth assets over cash and bonds. But expect more volatile and constrained returns as US inflation starts to turn up. Watch US inflation, bond yields, President Trump, the Italian election, China, the Sydney and Melbourne property markets and global […]

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Why cautious optimism is better for your investment health than perma pessimism

Published: November 30, 2017

  Key points Worries about an imminent financial crisis remain high. Australians seem particularly negative about the year ahead. However, the global economy is the strongest it’s been in years. More fundamentally, cautious optimism is essential if you wish to succeed as an investor. Introduction At the start of last year, with global and Australian […]

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Bubbles, busts, investor psychology…and bitcoin

Published: November 22, 2017

  Key points Investment markets are driven by more than just fundamentals. Investor psychology plays a huge role and along with crowd psychology helps explain why asset prices go through periodic bubbles and busts. The key for investors is to be aware of the role of investor psychology. A great defence is to be aware […]

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The medium term investment return remains constrained

Published: November 9, 2017

  Key points A further fall in investment yields across most major asset classes points to a constrained medium term return outlook. For a diversified mix of assets, this has now fallen to around 6.5% on our projections. For investors the key remains to: have realistic return expectations; allow that inflation is also low so […]

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Five great charts on investing for income (or cash flow)

Published: October 26, 2017

Key points At its core, successful investing is simple, but we have a knack of making it look complex. These five great charts help illuminate key aspects of investing for income (or cash flow): there are lots of alternatives to bank deposits for income; the gap between yields on different assets provides a guide to […]

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