Posted on : By : PPD1962 Posted in : Debt|Equities|private credit|Private Equity

EQUITIES: which stock should I buy?

QUESTION:  The number of listed stocks is falling across many exchanges.  Which stocks should I buy?

ANSWER: Your question is the wrong one for investor interested is getting a reasonable return of any given risk preference.  The question should be what shouldn’t I own?

Since the nadir of the global financial crisis (“GFC”) in 2009 the listed equities markets have profoundly changed because:

  • the proliferation of private equity funds;
  • the increased availability of  private debt to companies and investors;
  • the shift from active management to passive management in public equities’ markets; and,
  • gamification, rather than investing, by small retail investors.

In short, picking winners requires now requires an even larger edge in information (non-public mostly) and analysis, whereas picking losers in the listed markets requires mostly analysis and public information.

TSA expects the number of listed equities to continue to shrink.

Contact TurnerStreet if you wish to buy our current asset allocation recommendation (we do cash and equity only allocations for our wholesale clients), and the list of the stocks TurnerStreet would buy for a typical wholesale client, or if you would like TurnerStreet to manage your equities and derivatives portfolio.

IMPORTANT: This Q&A is general product advice for wholesale or sophisticated investors, and NOT suitable for retail investors.  Retail investors should seek advice specific to their circumstances and not rely upon general product advice written for other types of investors.  Retail investors acting like wholesale/sophisticated investor are likely to experience inappropriate and/or excessive risk for their circumstances, and unacceptable losses.
Posted on : By : PPD1962 Posted in : Equities

Equities: if everyone is going passive, why shouldn’t I?

QUESTION:  I saw this article in The Economist.  If everyone is going passive equities, why shouldn’t I ditch my active equities manager?

ANSWER: You probably should ditch your existing active equities manager, but don’t put the money into passive funds.

Firstly, as background, let’s not pretend that traditional active managers were not the catalyst themselves for the growth of passive investing.  Active managers were constructing portfolios with poor return/risk characteristics, and charging too much. Their objective was raising funds under management (“FUM”) from investors which required top decile performance….do you realise how much risk you need to take to get to top decile in any quarter, and is it any surprise that the volatility will mean bottom decile performance regularly too?

Family offices and HNW individuals will eventualy realise that active management can be done differently, therefore avoiding the perils of passive fund investing, and the poor return/risk characteristics of traditional active managers.

You are invited to join the family office of TurnerStreet’s founders in a new form active equities management where the risks match the returns. The objective is not to shoot the lights out, but to do a little better than the index over the long haul.

Contact TurnerStreet if you wish to buy our current asset allocation recommendation (we do cash and equity only allocations for our wholesale clients), and the list of the stocks TurnerStreet would buy for a typical wholesale client, or if you would like TurnerStreet to manage your equities and derivatives portfolio.

IMPORTANT: This Q&A is general product advice for wholesale or sophisticated investors, and NOT suitable for retail investors.  Retail investors should seek advice specific to their circumstances and not rely upon general product advice written for other types of investors.  Retail investors acting like wholesale/sophisticated investor are likely to experience inappropriate and/or excessive risk for their circumstances, and unacceptable losses.