Report
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Aussie Equities Month in Review - December 2018

  • No major changes to guidance.
  • The return for the ASX 200 was -2.8% for the year vs -4.4% in the US and -11.2% in Europe.
  • Materials had a strong month, posting a 5.3% return vs the broader index (-0.1%).
  • We moved our model portfolio to a more defensive positioning since the September correction and it has performed broadly in line with the benchmark.
  • A lack of downgrades meant the upgrades: downgrades ratio for the market was above the long-run average.
  • In Financials, earnings certainty measured by the variation of analyst estimates was relatively low vs the long-run average.
  • The ASX 200 is now 2.1% below fair value based on the 12-month forward PE vs its long-run average. Energy, Financials, Materials and Consumer Discretionary have the most value.
  • Despite the rally in the Chinese Yuan, the Australian dollar has been under selling pressure.
Provider
Macro Strategy Advisors Pty Ltd
Macro Strategy Advisors Pty Ltd

About  us:

  • The business is a Proprietary Limited Australian company that is owned and fully operated by Shane Lee from a small office in Sydney’s CBD.
  • Shane worked for 17 years in Sydney-based senior research roles (economist, equity strategist and bond strategist) in global and regional investment banks and a domestic commercial bank prior to starting Macro Strategy Advisors. These roles straddled the asset classes making him uniquely positioned to advise multi-asset investors. He worked for the Reserve Bank of Australia (RBA) for 3 years as a housing, commercial property and equity market analyst and a liquidity forecasting specialist.  He worked as a structural engineer in Queensland for 10 years prior to his career at the RBA. 

Aim of our business:

  • To partner with our clients in their aim to maximise returns. We provide timely, independent and thought-provoking research on thematic macro issues that are impacting or could impact financial markets. We aim to produce research that prompts our clients to question their assumptions.

Services:

  • A fortnightly research note.
  • Regular presentations and data support delivered by understanding our clients interests and investment process.
  • We also in work in confidence to investigate, analyse and report on issues at our clients direction. This work is done on a project-by-project basis.
  • As an Australian based business, the main focus is analysing how domestic and global issues impact Australian investors. However, our global and domestic insights are also valued by our offshore clients.

Our Edge:

  • Our low cost base relative to our competitors allows us to provide a quality product at a reasonable cost.
  • We are fully independent and don’t support a banking function or any third party. We have no interests other than providing our clients with the best possible research.
  • Our focus is not point forecasting, but providing rigorous analysis and insight. We don’t routinely focus on the top or bottom 10% of likely outcomes to create a headline.
  • Shane’s background in engineering has provided clients with unique insights into global infrastructure and domestic housing issues.

 

Analysts
Shane Lee

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