Market Matters Q&A

Copper (Cu)

Hey guys, after the sell off in copper stocks, would you be buyers of SFR or WIRE at these levels? When do you think is a good time to establish a position or increase a position?

Josh

Why would MM suggest EWY over IKO ETF as alternative investment funds into Korea?

I do not understand why MM would analyse EWY over IKO as an ETF to invest in Korea. Investing in an American ETF will attract additional fees for the transfer of funds, and horror of horrors could attract the attention of the IRS. I was advised by an experienced accountant years ago to never invest in US shares or ETFs directly as it can attract the attention or the IRS, who simply do not understand the tax-free status of SMSFs. Certainly I will never do so, as I have great respect for my fund administrator, and will never aim to make his life more complex than it is.

Also, seeking clarification on whether domestic Korean investors, who I understand are happy to borrow more funds than most to invest (or gamble?) into their market? Are Japanese generally more cautious? These cultural differences add to the turbulence in the Korean market, accelerating the ups and downs. Not sure about Chinese, but perhaps the Hong Kong market is also pretty volatile for these reasons. Am I right or up a gum tree?

Bill

Credit Corp (CCP) Outlook/Buy?

Hi MM team

Thanks for the high quality reports and insights! I would like to hear your thoughts on Credit Corp (CCP)? They look to be at a good entry price with solid fundamentals and generally trade in a range which they are trading towards support

Chris

MMKT, AAA vs Macquarie’s Accelerator account

I do not understand what advantage MMKT & AAA provide over Macquarie Bank’s Accelerator bank account. It pays 4.15% per month, calculated on a daily basis. You have to have a Cash Management Account (CMA) to manage the transactions, like all banks require. It pays 2.25% in same way. Both of which are far better than NAB, for example, at 1.40% for iSav and 0.0% for Sav. Also, our funds are in an SMSF structure, so funds must be visible to a third party – a fund administrator – and Macquarie is well set up for this. (It holds around 1/3 of all SMSF cash funds.) Last time I checked NAB could not manage third party access. Another big thing is that there are no brokerage fees and access to funds is immediate for investing or withdrawals. Also, Macquarie is hooked into Bell Direct as brokers, and I have found their website and facilities to be terrific.

Bill

SDR – Safe from Displacement?

Hi MM,

I note your positive commentary on SDR in this morning’s report. I have been watching SDR lately mulling whether to take a position. In brief, my main concern is whether (or not) SDR is at material risk of displacement over time by competitors using agentic AI given SDR’s software/business model (i.e. insufficient moat, growth/pricing power affected etc etc – the typical concerns that have driven the AI-fear based tech sell down). I have seen commentary to this effect. Do you agree with this commentary to any degree…or do you think it doesn’t properly consider or appreciate the robustness of SDR’s business model and its moat/competitive advantage? Etc.

Thanks,

Darren

Darren

Broker Consensus

Hi Team,

Sometimes when a share price changes, the only reason you give is a broker company has upgraded or downgraded the company. Such as on Wednesday the AGL broker consensus rating the reason for the fall. I am just wondering how much do you factor these consensus ratings into your decision making. I can’t help feeling that in many cases they are talking their own book. I suppose some algorithms could also be looking for these changes and it becomes self fulfilling.

Regards
Ray

Ray

Rate rises and inflation

Hi Gents, Excellent ongoing commentary from yourselves as ever!
I am of the opinion that rising prices are a symptom of inflation (actual inflation being growth in money supply via central banks or expansion of lending), but even if someone holds a different view to the definition, can you please explain why a rising oil/ energy price is defined as “inflationary” and requiring rate rises, when the rapid rise in price is obviously generated at this time by anticipated lack of supply, rather than increased demand (implying a strong economy). I would think a rapid rise in energy prices is as effective a headwind for the economy as any interest rate rise. Your interpretation would be appreciated.
Regards Tony

Tony

Thoughts on PE1 as a vehicle to get exposure to SpaceX

With rising chatter over the likely public listing of SpaceX is MM keen to get exposure to what may be the largest ipo in history! If so do you see PE1, Pengana Private Equity Trust as a good vehicle to gain exposure? I’ve read that SpaceX is now 14% of the fund but is otherwise diversified across 550 private companies also including Anthropic and OpenAi, other ipo likely exciting candidates.

Andrew

Commercial Property Investment

Hi James

Commercial Property Investment

Looking at VAP (Vanguard Listed Property) as a proxy we saw highs of $105 six months ago and now $85. A nearly 20% fall.

I see the ‘equation’ as complicated as property rental incomes might be steady and typically should increase with inflation. However, the cost of debt, dependent on gearing levels, will squeeze investment returns. The higher the gearing or debt levels the greater the squeeze. In addition and on the plus side, we all know there has been significant inflation in building costs which should make existing investment relatively attractive.

My question – as a long term property investor how do you work out if the higher interest rates and other factors are reflected in valuations?

Lindsay C

Lindsay

Magellan Financial Group (MFG)

Reaction to MFG acquiring Barrenjoey was initially very upbeat, but the excitement looks to have been short-lived.
What are your thoughts on the retail SPP?

Frank