Perspectives
Travels with a Donkey
October, 2024
Whilst most investors and market participants are focussed on the forthcoming US Presidential election, a recent visit to Morocco prompted us to think about “Frontier” markets. Investors have often been drawn to the exotic in search of opportunity and the expectation that returns on accelerated development should be high. We have talked about the “Advantages […]
Conflict and markets
October, 2024
Conflict is an emotional topic. Every conflict in the world is personal to somebody. It goes without saying that we all wish for a world without conflict, but regrettably this has now become an entrenched risk which investment markets appear to take in their stride. As an illustration of this ability of markets to cope […]
When you should diversify (and when you shouldn’t)
September, 2024
Diversification is vital when aiming to manage investment risk. Diversifying asset classes reduces volatility of returns (and returns themselves) whilst diversifying holdings reduces the chances of loss (and gain!). We have been questioned many times regarding the relatively concentrated nature of our strategies (for those who don’t know, we limit the numbers of holdings in […]
Into an Easing Cycle
September, 2024
This week the Federal Reserve followed the European Central Bank and Bank of England in lowering its main rate of interest from 5.25% to 4.75%. These are the first cuts in interest rates since March 2020 and they effectively announce to the world that the battle with pandemic related supply-side price rises has been won, […]
The True Value of Gold
September, 2024
We have had many questions about gold over the past few months and thought it would be useful to explain in a little more detail our thinking on the asset and our thoughts on its role in a portfolio moving forward. The allure of gold is understandable albeit slightly flawed. Gold is a stable element […]
Crowded trades and unintended consequences
August, 2024
Our approach to investment is based on two simple pillars: buy growing cash flows at reasonable prices diversify by buying assets that become more valuable when investors get nervous We cannot forecast how and when market volatility will occur, however we can ensure that we are not allocated to crowded trades which do not meet […]
I’m Afraid There’s No Money!
August, 2024
The recent dour fiscal reports from the Treasury under the new stewardship of Rachel Reeves recall what is said to be the most expensive joke in British political history. In 2010, Liam Byrne (then Chief Secretary to the Treasury) left a note to Philip Hammond, the incoming Chancellor to effect that “I’m afraid there’s no […]
Mr Market will offer you a price, you don’t have to take it
August, 2024
Over the course of a few days’ investors have experienced significant volatility in global financial markets. The Japanese equity market’s TOPIX index fell by over 12% on Monday, marking the largest drop in this major index in 37 years, before bouncing back by over 9% on Tuesday. This turmoil followed weak US economic data last […]
Free Lunches and Tourist Taxes
August, 2024
In many industries whether it’s aeronautics, engineering or finance often the only way to make sense of large complex and interacting sets of data is to build a model. There are many models of the modern economy: classical; Keynesian; monetarist and neoliberal to name a few, but back in 1949 an economist at the London […]
Investment Outlook
July, 2024
US politics continues to take centre stage in the news and this will likely remain the case for the foreseeable future. The political volatility is only one aspects to consider when investing however and investments have been said to ‘climb a wall of worry’. This week we hosted our quarterly Tacit Thought Live webinar in […]