Morning Report Tuesday 29 July 2014
**QBE downgrades its margin guidance below analysts’ expections of 10%**
As Challenger surges, are there opportunities with other Fund Managers?
Yesterday we witnessed our recent purchase of Challenger Ltd (CGF) surge in a flat market to 10-year highs – a very nice feeling. Overall, this aligns with my view in the last Hickman Report that some fund managers are increasing their exposure to the Australian market - what better way than a stock that reflects the ASX200 but with continued outperformance. When we stand back and look at the relative performance of Challenger, a Diversified Investment Manager, against the US equities investing Magellan it’s a very surprising outcome. Magellan is a massive underperformer and yet the US indices have been significantly outperforming the ASX200.
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