Markets

Eschewing the traditional route, Spatium Capital founders Nicholas Quinn and Jesse Moors grew their short-holding, long-only small companies managed fund from the seeds of a separately managed account.

Market neutral strategies should not only used as lever for investors that want an on-call safety valve for volatility, but retained as a strategic holding to drive portfolio performance throughout market seasonality according to Yarra Capital Management’s Andrew Smith.

A higher net interest margin drove a 10 per cent increase in CBA’s net profit after tax, while Wesfarmers benefited from a strong performance by Kmart Group and the chemicals division. But with much of the upside for these companies already priced in, investors should be clear about valuations before buying in.

The ethical investment house believes consumer credit can be positive for society if it is used to buy useful items. But companies like Afterpay focus on impulse purchases that are more likely to push vulnerable Australians into financial over commitment.

Increased traffic volumes and higher earnings have provided valuation support for the infrastructure company, ClearBridge Investments’ Shane Hurst says, with the post-COVID-19 recovery positioning the business for solid growth.

Lending specialist Daniel Zwirn spoke candidly about investor “credit myths”, and the misunderstandings that hold people back in the selection and movement of assets in portfolio construction.

Negative-yielding debt topped US$18 trillion at its height in late 2020, representing a quarter of global bonds outstanding at the time. With the stock of negative-yielding bonds now yielding in the positive, owners of the debt face ugly marked-to-market losses – but counter-intuitively, there were investors willing to buy them.

BlackRock sent a shiver through the domestic ETF market, which has tripled in the last four years to around $25 billion, slashing prices for two if its core products.

While commodities proved a safe haven for investors in a brutal 2022, completing a rare two-year run at the top of the asset class returns table, Atchison consultant Kevin Toohey warns against expecting a repeat performance.

Analysts agree Australia’s big four banks are entering 2023 from a position of strength as they pass on rising interest rates to borrowers. Headwinds remain, however, and the total return picture for shareholders looks more complex.

While advisers are not yet seeing substantial client demand for semiconductor and chip stocks, the popularity of the AI chatbot ChatGPT has highlighted opportunities for Australian investors to gain exposure to the surging sector.

In its latest sustainability report HMC details the kind of comprehensive ESG strategy typical of a fund manager that appreciates the value of corporate responsibility – both to the group’s three funds and the broader environment.