| Good morning Voornaam, It's likely that you are familiar with how Exchange Traded Funds (ETFs) work. You buy one share and it gives you exposure to an entire underlying index, like the popular Satrix Top 40 product - the first share that I invested in all those years ago!
ETFs can get a lot more interesting than that, with varying results. One of the ways is to use factor investing, which builds a set of rules based on underlying factors like earnings growth rates or valuation multiples. To unpack these factors and whether they actually work, Nico Katzke from Satrix joined me for an incredibly insightful discussion. The podcast and transcript are available here>>>
You've been seeing China in the headlines, along with words like "stimulus" - something that you wouldn't naturally associate with a country run by a political group called the Chinese Communist Party. China is full of surprises, as market volatility tells us. And as history shows, this isn't the first time that we've seen stimulus in China. In the latest episode of Magic Markets, Justine Brophy of AnBro joined us to discuss the impact of China on equity portfolios, while Mohammed Nalla delivered macroeconomic insights around the region. Enjoy it here>>>
In company news, I'm afraid that Mr Justice Butcher (yes, just like you would expect the judge to be named in a Monty Python skit) had his way with the Sibanye share price yesterday. With a loss in court that might lead to a crazy outcome around a damages claim for the Santa Rite and Serrote deal in Brazil that Sibanye walked away from a few years ago, the market panicked. After all, Sibanye simply cannot afford any further setbacks.
In happier news on the local market, Altron has updated its earnings guidance and things look much better. HEPS has moved sharply higher and the group is profitable even with discontinued operations taken into account.
Other news includes earnings at Equites and a deal at Lighthouse in the property sector, along with chrome and PGM news at Mantengu Mining and Tharisa. Also in property, Newpark is an example of the risks that face highly concentrated funds.
All these updates plus numerous Nibbles are in Ghost Bites at this link>>>
For those of you who are interested in trading or curious about how it differs to investing, The Trader's Handbook is the perfect podcast to satisfy that curiosity. The latest episode with IG Markets South Africa deals with index trading and why it is a popular choice for traders. Get ready to learn in this podcast and for those of you who prefer to read, there's a full transcript as well.
As is customary on a Friday, DealMakers is here with your weekly summaries of what happened in the world of South African M&A, along with local corporate finance activity and African M&A.
Have a great day and we will see you on Sunday for Ghost Mail Weekender!
PS: as you plan out your diary next week, register for Calgro M3 on Unlock the Stock on Thursday - the last time that the outgoing management team will be presenting on the platform. |
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| FEATURED: Does factor investing work? |
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| Satrix: Factor investing takes ETFs to the next level. Instead of tracking a stock index (like the JSE Top 40), these ETFs have a set of rules based on investment fundamentals like valuation multiples or even levels of debt. The sky is the limit with the creativity that goes into these factors, but do they actually work?
To unpack these types of ETFs and the thinking behind them, Nico Katzke of Satrix joined me for an insightful discussion. Find it here>>> |
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| FEATURED: The Trader's Handbook Ep 8 |
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| | | IG Markets Episode 8: In Episode 8 of The Trader’s Handbook, learn why indices are an attractive option for traders, providing broad market exposure, lower risk compared to single stocks and significant cost advantages. We also discussed practical tips on technical indicators such as RSI and stochastic oscillators. Enjoy it here>>> |
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| Key market themes locally and abroad with Satrix |
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| Satrix: There are many sources of risk that might concern investors currently – making the case for diversification as strong today as it ever was. Satrix highlights some of these risks and the opportunities they present. Find it here>>> |
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| Global Mobility - Common Mistakes by Employers and Employees |
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| | | Ghost Stories podcast: Elzahne Henn of Forvis Mazars in South Africa sheds light on the common mistakes and misconceptions related to cross-border employment. These insights are valuable for employers and employees alike. Enjoy it here>>> |
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| Ghost Bites - local company news: |
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| Ghost Bites: The latest on Altron, Lighthouse, Mantengu Mining, Newpark REIT, Sibanye-Stillwater, Tharisa and numerous Nibbles in Ghost Bites here>>> |
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| Investec podcast: responsible investing |
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| | | Investec Wealth & Investment International has launched a comprehensive guidebook on responsible investing. In the latest episode of the No Ordinary Wednesday, Jeremy Maggs speaks to the authors, Boipelo Rabothata and Maxine Gray. Enjoy it here>>> |
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| International Business Snippet: |
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| Berkshire Hathaway (yes, Warren Buffett's famous investment company) has reduced its stake in Bank of America to below 10% after significant selling in the past few months. Buffett is taking a generally cautious approach to banking exposure, having reduced the extent of that exposure in recent years.
In the US, Delta Air Lines expects only modest revenue growth in the final quarter of the year, as previous experience has taught them that there is "choppiness" (their word) around election time. We certainly have the same issue in South Africa, where elections are inevitably a time of lower economic activity as everyone holds their breath. At least holiday bookings are looking strong, so Americans still have cash for travel.
Our latest research in Magic Markets Premium is on Nike. We've been bearish on that stock since the first time we covered it in Magic Markets Premium and time has proven that approach to be correct. How do we feel now? You'll find out in the latest report for our subscribers this week. |
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| Magic Markets: The China Effect |
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| | | Magic Markets: It's not easy to understand the stimulus that we are now seeing in China. The impact on equity portfolios is substantial, as China is such a huge market globally.
Justine Brophy of AnBro joined us to make more sense of what's going on there. Get it here>>> |
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| IG Morning Call: daily macroeconomic update |
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| US equity markets traded in a narrow range yesterday, balancing weaker than expected employment data with higher than expected inflation data. European index futures are suggesting a flat open with our local bouse, the JSE All-Share Index expected to follow suit.
Asian markets are however softer on the day, trading in angst ahead of tomorrow’s fiscal stimulus announcement out of China.
The dollar is trading well off yesterday’s highs, lending itself to some near term strength in commodity prices and emerging market currencies such as the rand.
But the rand remains at its softest levels in roughly three weeks.
Oil prices are flat in early trade today although surged into close yesterday, still threatened by Middle Eastern tensions.
Traders will want to keep an eye out for this afternoon's US PPI inflation data.
Key Indicators: USD/ZAR R17.50/$ | US 10yr 4.07% | Gold $2,644/oz | Platinum $976/oz | Brent Crude $78.80
The macroeconomic update is based on IG's morning call update |
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