What are your Investment Rules?

[kiora]

"Yahoo Finance Chartbook: 32 charts tell the story of markets and the economy midway through 2024"

https://finance.yahoo.com/news/yahoo...095812719.html

[kiora]

"Top performing funds: A high-conviction idea from a manager that delivered 35% in FY24"

https://www.livewiremarkets.com/wire...P%20PERFORMERS

"Stick to your process, ignore negative noise, and focus on avoiding poor-performing positions just as much as finding those that generate alpha.

That's the advice from one of Australia's top-performing Australian equity fund managers from FY24, Liam Donohue of Lennox Capital Partners, whose Australian Microcap Fund delivered its investors a return of 34.73% in FY24. "


"From what we’re seeing in terms of the number of new opportunities coming across our desks it must just about be time for small and micro-cap stocks to shine," Donohue says.

1. What was the biggest decision or call that you made in FY24 that helped drive your performance?

The biggest driver of overall performance for us was probably ‘time in the market’ instead of ‘timing the market’. And by that, I mean that even when the market wasn’t looking too flash in late FY23 and your natural instinct was to pull back from things that felt risky, we stuck to our process and worked hard to find some really good quality conviction positions for our investors.

We view our job as fund managers as providing investors with exposure to exciting, quality businesses at the smaller end of town that generate returns through time – and that is especially the case when markets are wobbly because that can often provide the best opportunities for longer-term investing.
2. What was your best trade from the last 12 months?
It’d have to be MMA Offshore (ASX: MRM, formerly Mermaid Marine) which is an offshore vessels business that many in the market have had a history with. The company saw their share price peak at around $14 in the last offshore boom (circa 2014) but it all came crashing down when demand for vessels dried up and ultimately the stock bottomed at $0.25 in 2020.

From there, the new management team did a phenomenal job of cleaning up the business including some hefty recapitalisations and ultimately were able to capture the upswing in the offshore vessel market through 2023 and 2024. Unfortunately for investors, management may have done too good a job and the company has just been taken private by a Singaporean investor.

Luckily for those looking for a way to play a similar dynamic, there’s a small domestic vessel operator named Bhagwan Marine that is just about to hit the ASX boards and we think looks like a compelling opportunity.
3. Did you get anything wrong or would you have done anything differently looking back? i.e. is there a stock you wouldn’t have backed, or one that you wished you did, or do you regret not holding enough of a stock etc?
We absolutely got some things wrong – everyone does! In terms of things that we missed, one part of the market that has been strong through FY24 has been defence-linked businesses – and that is ‘defence’ as in war/conflict as opposed to stocks with defensive characteristics.

4. What is your outlook on Australian equities over the next 12 months?
It has to be positive!
We can see very early signs of that starting to happen in the US market, and when we think of the cumulative underperformance in the smaller end of town versus large caps over the past three years there’s a strong case that now is the time to be in small and micro-caps.
The compounding positive here could be that if markets kick-off, the floodgates might open in terms of new businesses IPO’ing onto the ASX and that tends to be a strong source of returns for our investors.

5. What is one thing investors will need to get right to be successful over the next year?

Our view is that we need to be as focused on avoiding the bombs as we are on finding the winners so that we keep as much of the positive alpha as we can without giving it back on negative alpha positions.

[kiora]

AND IT WORKS THE OTHER WAY!

"Who's still buying ASX bank shares? Are they cheap? The answers will surprise you!"

https://www.livewiremarkets.com/wire...m=BANKING%20UP
Macquarie notes domestic institutions were "significant net buyers of most banks" in the June quarter. Overseas domiciled institutions were also net buyers. Interestingly, Macquarie also points out that index funds were responsible for much of the flow."
" Aussie bank shares are rising because they’re rising. Consider that as the share prices of Aussie banks increase, so too does the proportion of their weighting within the S&P ASX200 – therefore causing index funds to buy even more of them."

"could be construed as "dumb money" buying, that is, with no consideration of the fundamentals"

"The issue here is that active fund managers can’t afford not to buy some bank shares to gain access to the sector’s strong performance. This is because bank gains are adding index points to the S&P ASX 200, and for managers who use this index as their benchmark, not buying increases the risks of their underperformance. Underperformance in active fund manager land equals less fees (and smaller bonuses!)

Ironically, it seems that the strong performance of Aussie bank shares is forcing both passive and active fund managers to keep buying them."

"Technical Analysis"

https://www.marketindex.com.au/news/...nical-analysis

[kiora]

Betashares Wealth Builder Australia 200 Geared (30-40% LVR) Complex ETF (ASX: G200) and the Betashares Wealth Builder Diversified All Growth Geared (30-40% LVR) Complex ETF (ASX: GHHF) – hold at least a portion of Australian equities.

“The fund itself will collect dividend income or derive dividend income, and then it will pass through fund distributions to the unit holders of the ETF. Where franking credits have come through an Australian share, that will then be attached to the distributions of the fund,” Gleeson says.

"How to increase your exposure to dividends and franking credits"
https://www.livewiremarkets.com/wire...rm=THE%20PITCH

[kiora]

The grandson has now got $2000 invested through Sharsies
With the aim of CAGR of 15%
With NO FURTHER capital added???

I wonder if he's already thinking about retiring?
Maybe he doesn't get to know about his investments for a few years ???

CAGR 15%

2 YO $2,000
12 YO $8,910
22 YO $32,000
32 YO $132,423
42 YO $535,327
52 YO $2,167,314.00
62 YO $8,767,997.00