Investment Perspectives from Quay: Thinking about office

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Thinking about office Imagine you are an office manager for a medium sized firm of 20 employees. Under normal circumstances, you and the staff would occupy around 400 sqm of office accommodation located in the CBD. But these are not normal circumstances. Lockdown orders mean that all staff are currently working from home. You are

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Higher inflation can be a friend to real estate investors

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When investing in real estate, higher inflation is more likely to be a friend than a foe, helping protect investment from supply side issues and driving up the residual value of improvements, says Justin Blaess, portfolio manager at Quay Global Investors. “We take the view that investors shouldn’t fear inflation, particularly when it comes to

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10 charts we’re thinking about right now

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What it means House prices around the world are rising rapidly – including in the United States. Recent gains have re-opened old GFC wounds, with escalating concern of another housing bubble. However, the data suggests the gains are driven not so much by excessive demand, but lack of supply. The number of ready to build

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CPD: Six reasons to not worry about inflation

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It’s that time in the cycle again. US bond markets and commentors are worried about inflation. But with US unemployment at 6.2%, should this be a concern? Before we begin, let’s define what we are actually discussing. Rising prices are a pre-condition for what we define as inflation; but this isn’t the only condition. Inflation

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Let’s get fiscal

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The year 2020 will be remembered for many events. Besides COVID-19, there were the Australian bushfires and US political turmoil. But financial markets also provided a memorable event. Last January, while the S&P 500 was coasting near all-time highs, stories emerged of a new virus in China. If you told an investor then that this

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What the US election and a COVID-19 vaccine mean for real estate

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The outcome of the US presidential election and Pfizer’s coronavirus vaccine announcement have resulted in some significant swings in market prices across global equities and listed real estate. The following update is from Quay Global Investors’ principal and portfolio manager, Chris Bedingfield. US presidential election It appears Joe Biden will win the US presidency and

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CPD: Thinking about liquidity

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A slightly controversial chart Last month, we published a paper of the 10 most interesting charts right now. One chart, which suggested the Federal Reserve does not influence long-term stock market returns, garnered the most attention.   The chart (and our observation) runs at odds with much of the mainstream financial commentary that suggests central

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10 interesting charts right now – COVID-19 edition

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Is government debt bad or good? What it means The government fiscal response to COVID-19 and the associated forced shut-down of the economy has been significant. In our view, there is little doubt these policies have helped companies and households navigate the crisis (and therefore in turn, support equity prices). The risk now is that

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Explaining the April US equity bounce

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Key points US unemployment is heading for levels not seen since the Great Depression. Despite the current dire economic outlook, US equity indices are back to October 2019 levels after a sharp recovery in April. Ultimately, share prices are driven by corporate profits; and corporate profits are driven by, among other things, government deficits. The

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30 years of investment lessons from Japan, and the implications for real estate

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Imagine a person of prime working age (~40 years old) seeking investment advice for long-term financial security, and ultimately, a comfortable retirement. The potential investment advice may look something like this: Invest in long-term growth assets, like equities Avoid currency risk and favour domestic asset allocation Choose a low-cost index fund Don’t look at the

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