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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CPD: 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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QE and low interest rates won’t stimulate the economy: Quay

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The Reserve Bank of Australia’s policy in 2019 of cutting interest rates has done little to stimulate the Australian economy, but any attempt at introducing quantitative easing (QE) in 2020 is also doomed to fail, says Chris Bedingfield, principal at Quay Global Investors. “The big challenge for policy makers in 2020 will be to find

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CPD: Negative bond yields – What does it mean, and what’s the end game?

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Since the beginning of this year, financial markets and expectations have turned decidedly bearish. Concerns about a Sino-US trade war, along with the so-called ‘inversion’ of the US yield curve, have heightened apprehension of a US-led recession. This is highlighted by the recent increase in negative-yielding bonds. As per the chart below, the amount of

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CPD: Aussie QE may be coming, but it will probably do nothing

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Over the past 18 months, the Reserve Bank of Australia (RBA) has changed tack from “the next move in interest rates is up” [i] to a dovish bias. So much so, that this year they have cut the official cash rate from 1.5% to 0.75% (at the time of writing), with potentially more to come.

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Avant backs Quay Global Investors in global real estate equities

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Bennelong Funds Management’s global real estate manager, Quay Global Investors, has won its first institutional mandate, partnering with Avant, one of Australia’s leading medical defence organisations representing over 78,000 health practitioners and medical students. Founded in 2013, Quay is a boutique asset manager focused on the preservation of capital and creation of wealth through strategies

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Quay’s strong performance sees rating upgrade

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The Quay Global Real Estate Fund has been upgraded to a recommended rating from Zenith Investment Partners, recognising the fund’s recent strong performance and business growth. The Quay Global Real Estate Fund, which was launched in 2014, is the flagship fund of Quay Global Investors, founded by portfolio managers Justin Blaess and Chris Bedingfield as

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CPD: Where profits come from, and the vulnerabilities in Australian corporate earnings

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Key points Equity investors rejoiced in June as the Fed signaled it may cut interest rates – but interest rates do not drive long run equity performance. Profits do. While the Fed gets a lot of credit for the US bull equity run, the reality is that market performance has been supported by a near

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CPD: A conservative government, falling interest rates, and new APRA lending guidelines; what now for residential property?

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The RBA recently cut its official interest rate by 25 basis points to a record low of 1.25%. Along with the recent win by the conservative government (that campaigned on maintaining tax concessions for property investors), there is now a growing expectation that the recent decline in residential prices will end – with some commentators

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CPD: Modern Monetary Theory, and why you’re still hearing a lot more about it

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Last month we published our take on one of the biggest economic discussions today – Modern Monetary Theory (MMT). Most of the public debate to date has centred around the role of government: that is, deficits, the causes of inflation, and implications for public policy. As we stated last month, however, MMT is extremely detailed

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