Managed Fund Articles

It’s a popular pastime for professional and individual investors to bemoan the impacts the rise of passive funds is having on markets. However, recent Goldman Sachs research questions the validity of this argument. We use that research as we embark on a myth-debunking journey.

With interest rates at a decade-high and the RBA signalling potential rate cuts sometime next year, the current yields on mortgage funds present an attractive opportunity. Mortgage funds have gained traction as higher interest rates have made lending to the commercial real estate sector increasingly attractive. This shift has occurred while traditional property investments such as real estate investment trusts are facing significant valuation challenges. According to a recent report by investment firm Zagga, more investors are gravitating toward private real estate debt for property exposure in order to avoid the volatility typically associated with property markets. This trend is fuelled b

More than a few fund managers have highlighted that fixed income investing these days is a world away from what it used to be. They’d be right. The very structure of global fixed income markets has changed since the Global Financial Crisis. As with all structural shifts, it pays to revisit the here and now on occasion to ensure your current strategy is fit for purpose. The reality is the strategies necessary to generate alpha in fixed income markets are different from the past.

With the Fed initiating a rate cutting cycle in September, investors are increasingly focusing on asset classes positioned to outperform in a falling rate environment. Enter smaller companies. Historically, small-cap stocks have outperformed their larger counterparts during periods of declining interest rates — and this trend seems to be taking hold as both global and domestic small-cap benchmarks have shown improved performance in recent months.

The healthcare sector is back in focus, and for good reason. As the global economy slows and interest rates drop, investors looking for a safe haven are turning to the healthcare sector’s long-term growth potential.

With the vast array of information investors have at their fingertips, you’d think it would be easy to spot investment trends before the rest of the market. If only. The problem is there’s too much available information for most investors to make sense of. After a while, reams of written text become just more words rather than a source of learning. Hence, interpreting and understanding the vast universe of words that relate to investing is almost impossible for most investors. So the question is: how can investors side-step this information overload challenge to spot investment trends before the rest of the market?

Australian shares have traditionally been a go-to for income investors due to their attractive dividend yields. However, the market is undergoing a significant shift and the record payouts that followed the resources boom seem to be coming to an end. Recently, the base yield of the Australian market dipped below 4%, with rising costs and a weakening Chinese economy contributing to the decline. Morgan Stanley forecasts that the S&P/ASX 200 dividend yield will drop to just 3.6% in FY25, potentially marking the lowest yield for the ASX 200 in decades, excluding the COVID-19 period.

Blackrock’s Q4 equity outlook report contains some useful intel to help investors make sense of global markets at this juncture. With the US election looming and the Fed’s initiation of a rate cutting cycle, there’s a lot for markets to worry about and celebrate. One thing’s for sure: it’s unlikely to be a boring end to the year.

Innovation has moved beyond being just a nice-to-have at the periphery of most portfolios—it’s now a key focus in investment strategies. With sectors like AI, renewable energy, and biotech leading the way, more investors are adjusting their portfolios to capture the growth potential of these cutting-edge technologies.

You may remember when the yen carry trade revealed itself as the catalyst for August’s sharp selloff across global markets. The knock-on effects of its unwinding surprised more than a handful of investors at the time. The sobering news is that the yen carry trade continues to linger and is arguably the market’s biggest risk right now. It may well be prudent for investors to prepare for a repeat of August’s volatility.

Cash and term deposits (TDs) have been popular with investors over the past couple of years, thanks to the RBA’s aggressive rate hikes. With cash rates peaking at 4.35%, investors enjoyed returns as high as 5% through TDs and high-interest savings accounts.

You may remember the pre-2021 years when Cathie Wood’s ARK Innovation fund was riding high as one of the strongest performers in the global fund management sector. Her philosophy, strategy, stock picking, and track record were all working in her favour. Investors were even in the habit of following Cathie into stocks whenever the ARK Innovation fund purchased a new position.