“One of the real wildcards in recent history has been the performance of commodity stocks. We don’t see a sudden recovery, but we suspect that prices are near rock bottom levels and the second half of 2015 could be the base period in which they come back from,” the report says.

“Energy and the bulk commodities, in addition to base metals, have experienced horror numbers. A huge amount of shareholder wealth has been destroyed. The Australian dollar and terms of trade decline have reflected this perfectly.

“Yet we’re starting to open up to the idea that maybe the large and well diversified names – like BHP for example – are about to turn around their fortunes in the New Year.

“Glencore’s panic selling may have been a sign of the bottom. The rally was purely ridiculous, we would be completely staying away from that type of volatility. But BHP in the mid-$20 range is a different matter. We spoke about it as an attractive exposure to consider next year at our end of month October webinar. Our team is watching price action very closely and we wouldn’t be surprised to see a slightly positive outperformance in earnings (considering market expectations are already low) in February.”

Invast believes timing is everything and the bulk commodities and energy stocks have been absolutely discarded in this huge commodities sell off. Invast believes they deserve a close eye from time to time, as part of a well-diversified thematic portfolio.

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