Market commentary: Sep 2021
Portfolio returns
Virtually all the return over the last year came from the growth side of client portfolios. Overall, company share prices on Australasian and international share markets have risen - particularly in the first six months of the period. Since then, market sentiment has been on the volatile side as short-term investors react to news.
In general investors seem focused on Covid-19 announcements, economic growth, jobs growth, inflation – none of these are surprising. The US withdrawal from Afghanistan and default concerns over China Evergrande (Chinese property company with US$300 billion debt) have also influenced market direction – albeit temporarily. It seems that speculative opinion is positive, and investors have shrugged of these concerns and are putting their faith in continuing economic growth and easy monetary conditions.
Investment principles and philosophy
Risk and uncertainty are always present in markets, but because of Covid-19 and the seemingly unstoppable rise of share markets, the current outlook is more complex than usual. In our opinion discipline, calm and taking a long-term perspective is more important than ever. And investing in quality companies. This contrasts with the investment philosophy of speculators (rampant in the market right now) chasing the latest fad and looking at investment in short time frames - a high-risk strategy.
Both our International and Australasian equity strategies include 3 to 4 core fund managers. Collectively, they invest in a broad range of excellent companies that have the qualities for continued success for at least the next 5 to 10 years. We aim to invest strategically to ensure diversified exposure to companies across countries, sectors, and industries.
Commercialisation of space?
Jeff Bezos returned safely to Earth on July 20 after being blasted 100km into the atmosphere flying for 10 minutes in a pilotless rocket. Nine days earlier Richard Branson zoomed to an altitude of 80km in a piloted space plane.
An entrepreneur-led drive into space is underway. Opportunities from the commercialisation of space include space tourism, advancing scientific knowledge, people living beyond earth, mining asteroids for rare minerals, and manufacturing possibilities previously kept hidden by gravity. But there are risks. Space travel is dangerous, and space exploration could intensify global political tensions. There are many difficulties to overcome.
Whatever the doubts or drawbacks about the question, a privately led space adventure has begun that has already notched achievements. And James T. Kirk from the original "Star Trek" – yes “Captain Kirk” - launched on 13 October making Shatner, 90, the oldest person to travel in space!