The global economy is facing the dual headwinds of a credit crisis and a confidence crisis. Matthew Sherwood, Perpetual's Senior Manager, Investment Markets Research finds that although there is no quick solution to turn around global economic prospects, investors will have to weigh up the risk of short term losses against the potential of long-term gains at some point in 2009.
The recent announcement by authorities of capital injections into banks is another positive step in re-building confidence in the global financial system. However, Matthew Sherwood, Perpetual's Senior Manger, Investment Markets Research finds that as this problem is being addressed investors have refocussed on the pending advanced economies recession and stocks with strong balance sheets and transparent business models are likely to outperform in a difficult climate.
Perpsective: Australian banks - a patience game
If enacted, the recently announced US$700 billion rescue plan for US banks will probably mark the beginning of the end of the US financial sector woes, but its economic woes will continue. However, Matthew Sherwood, Senior Manager, Investment Markets Research at Perpetual Investments finds that although Australian banks are looking at a more difficult trading environment, their growing market share and attractive valuations have cushioned the impact.
Perpetual leadership survey: 2008 results
To better understand the needs and issues faced by Australian business leaders, Perpetual conducts an annual survey of business executives. Now in its third year, it provides a unique insight into today's boardroom debates and tomorrow's business challenges.
This year we had an excellent response to the survey, with 661 interviews conducted with Australia's business elite, including Directors, CEOs and other senior executives, between 4-18 April 2008. Respondents offered their views on the challenges faced by the diverse industries they represent, at a time of significant change in the business environment.
Our research was framed by the global market downturn and the results not only reveal the major challenges that businesses face in 2008 but also how leaders are positioning themselves to respond.
Why long short is the new long
The market sentiment and dynamics have changed dramatically in recent months and investors need to reassess how to maximise their returns (alpha) by improving the efficiency of their portfolios in a lower return environment. Improving the efficiency of a portfolio means investors can extract significantly more return from the portfolio for the same level of risk. In volatile markets short selling strategies can be a useful tool that allow investors to reduce their risk by reducing their allocation to an asset class without reducing their return expectations.
August 2008
Perspective: Recession, recovery or something in between?
With global prices down 22% from their peak and credit market woes continuing, investors are asking if global and Australian economic conditions are likely to stabilise or worsen. Matthew Sherwood, Senior Manager, Investment Markets Research at Perpetual Investments finds that both economies are likely to moderate but avoid recession and that low-risk earnings and sustainable dividend growth are the keys to investment performance going forward.
July 2008
Perspective: A crude end to 2007/08, but some light at the end of the year
Over the past eight months global sharemarkets have been hit hard by the credit market turmoil and record oil prices. Matthew Sherwood, Senior Manager, Investment Markets Research at Perpetual Investments discusses the market outlook which is likely to be rough in the next few months in the wake of a tougher earnings environment, but may improve as investors look through the cycle.
June 2008
Perspective: The 21st century energy crisis
By the mid- 1980s most market analysts had assigned the 1970s energy crisis into history, but with oil prices more than doubling over the past 18 months the problem has resurfaced.
Matthew Sherwood, Senior Manager, Investment Markets Research at Perpetual discusses the increased risk for the global economy and sharemarket of a permanent rise in the oil price and what investors can do.
May 2008
Perspective: Five inconvenient truths about sharemarkets
Over the past five years global economic growth has been strong and inflation low, but higher oil prices have seen this change. Matthew Sherwood, Senior Manager, Investment Markets Research at Perpetual discusses why this shift in the macro outlook has changed some old rules of share investing and where the opportunities are in the new environment.