28 Aug 2020
Friday Tidbit: How to live to 105
- Posted by Dejan Pekic BCom DipFP CFP GAICD
Dr Shigeaki Hinohara provided 6 pieces of advice on how to live to the age 105.
Completely agree with number 1, work keeps you young as long as you do not do not keep doing ridiculous hours as you get older.
- Don’t retire. But if you must, do so a lot later than age 65.
- Take the stairs (and keep your weight in check).
- Find a purpose that keeps you busy.
- Rules are stressful; try to relax them.
- Remember that doctors can’t cure everything.
- Find inspiration, joy and peace in art.
Enjoy.
Click to read.
27 Aug 2020
Initial Public Offering (IPO): Tech, tech, tech
- Posted by Dejan Pekic BCom DipFP CFP GAICD
IPO or Initial Public Offering refers to the process of offering shares of a private company to the public to raise capital using a public exchange.
For over half a decade it has been all about tech, tech, tech IPO’s which have generated massive amounts of investor and media attention.
In 2019 for example, public exchanges globally saw 263 IPO’s in the tech sector with total US$62.8 billion raised.
Must agree that the tech sector is exciting and sexy but the real question is whether all this hype converts into profitable returns for investors?
The answer, not surprisingly is both a yes and a no.
Some tech IPO’s have made insane returns for investors but in aggregate, the tech sector has been a disappointing investment.
For instance, the tech sector IPO’s in the United States returned -4.6% as a whole since 2019. This includes Uber which is currently trading at US$32.30 or 28.2% down from its US$45.00 IPO in 2019.
Click for chart.
Our point is that sexy and investing should never be used in the same sentence when investing because sexy businesses usually fail when it comes to making money over multiple decades.
21 Aug 2020
Friday Tidbit: Apple Inc.
- Posted by Dejan Pekic BCom DipFP CFP GAICD
It took 42 years for Apple Inc. to become the first listed company in the United States to be valued at a US$1 trillion dollars and only 2 more years to be the first to reach US$2 trillion mark in market capitalisation. Market capitalisation is calculated by multiplying the total number of shares on issue by the current share price.
That is 2,000 billion dollars or US$2,000,000,000,000.
Just confirms that money makes money and that the COVID-19 Pandemic has not been bad news for all business.
Click for chart.
19 Aug 2020
Australian Residential Property: Housing Affordability
- Posted by Dejan Pekic BCom DipFP CFP GAICD
This is different.
An argument that the COVID-19 Pandemic is not all bad news and might actually fix Australia’s housing affordability crisis.
What do you think?
Click to read.
14 Aug 2020
Guide to Market Recoveries (Part 2)
- Posted by Dejan Pekic BCom DipFP CFP GAICD
This is the second and final part using research to outline three facts about market recoveries and three mistakes that investors repeatedly make.
The Mistakes.
#1: Trying to time markets.
#2: Assuming today’s negative headlines make it a bad time to invest.
#3: Focusing too much on the short term.
Click for charts.
13 Aug 2020
Guide to Market Recoveries (Part 1)
- Posted by Dejan Pekic BCom DipFP CFP GAICD
Financial markets routinely collapse, this should not be a surprise.
To help you understand we are sending out this first of a two part series using research to outline three facts about market recoveries and three mistakes that investors repeatedly make.
The Facts.
#1: Recoveries have been much longer and stronger than downturns.
#2: After large declines, markets have recovered relatively quickly.
#3: Tough times have created some of the world’s leading companies.
Click for charts.
11 Aug 2020
United States Debt Level
- Posted by Dejan Pekic BCom DipFP CFP GAICD
Government debt levels over the next two decades are likely to be the biggest impediment to asset growth and return.
This is not to say that debt is bad thing, it is an extremely important tool and necessary for an economy to function but not when debt grows to excessive levels.
In January 2020 the Congressional Budget Office (CBO) projected United States Federal Government debt will exceed the post-World War II record in less than 15 years.
The situation is even worse when you consider that United States Federal Government debt does not include State debt or Local Government debt or unfunded public pension liabilities.
Click for charts.
The current United States Government debt escalation and other governments will keep cash rates ultra-low as has been the case in Japan because a 0% bond yield helps keep the debt servicing cost low.
This debt escalation however is unsustainable and eventually must come to an end but that is the big unknown. How?
Importantly, the investment insight from Benjamin Graham for times such as these is not to speculate and never to panic but instead, remain invested according to your appetite for risk and then react after the buying opportunity presents.
3 Aug 2020
Social Security: JobSeeker JobKeeper
- Posted by Dejan Pekic BCom DipFP CFP GAICD
These are the changes that begin from tomorrow for JobSeeker and on the 28th September for both JobSeeker and JobKeeper.
Expect it to get bumpy for asset prices and investment performance over the next few months.
Click to read.
