Macro Investor Week 1

For those that don’t know or are yet to investigate, this week MB launched its new paid investment advice newsletter, Macro Investor.

The second edition will be published 8.30 Monday morning. In the mean time, find below the contents page of the past week’s edition for you to consider a 21 day free trial subscription. Remember, we’re offering a once only “founding subscriber” offer to MB readers; a 20% discount until the end of July rounding the price down to $385.

The same price as Rupert Murdoch’s Eureka Report and something of an improvement in quality and independence. Enjoy!

Macro Investor Volume 1, No 1 

Macro Europe jumps clear of an accident 

• As Italy defeated Germany in the soccer, Prime Minister Monti claimed victory over Chancellor Merkel as she conceded to a united Europe.
• Details are still sketchy but markets correctly rallied on the relief that a Eurozone break-up is now far less likely.
• Extra risk capital can now be placed into the market, but the economic backdrop will continue to weigh on performance.

Data Global slide continues

• Australian data weakened but remained more robust than elsewhere.
• A wealth of US economic painted a deteriorating picture with hope in the handoff from manufacturing to housing construction.
• From Japan to Germany activity is under pressure.

Technicals Risk on Mr Miyagi

• Bullishness out of the EU summit is firing off long signals across major macro markets.
• European and US stocks likely to enjoy a relief rally, as commodities also reverse their oversold status.
• Looking for momentum confirmation before going long risk.

Stocks

(CSL)

• Leading pharmaceutical firm CSL is the pick of FARM’s selection of the ASX50.
• There is a dominant macro trend of rising healthcare demand across developed/emerging economies.
• Although rated a “Core” investment, current price action is overbought, indicating a “Hold”.

(CPB)

• Excellent growth and yield stock, leveraged to the energy and commodity boom.
• FY12 reported earnings impressive, and growth looks set to continue.
• FARM indicates a “Hold” due to market conditions, and only slight undervaluation.

(CCP)

• Small company leveraged to the over-leveraged Australian consumer.
• Large growth potential with equally large pricing opportunities.
• Currently rated a “Hold” but likely to offer buying opportunity soon, coming into earnings season.

Trades

(Europe)

• Speculative position on a possible bullish outcome from latest European summit.
• European stocks heavily oversold, exposure via unhedged iShares S&P Europe 350 ETF.
• Tactical trade for MacroGrowth portfolio that may build to a larger position.

(DJS)

• Embattled retailer in dominant bear market, with no investment signal.
• Falling wedge price-pattern identified – looks like breaking soon, because support level reached
• Predator takeover offer on Friday June 29 lifts share price nearly 15% but too murky to trust.

(Oil)

• NYMEX WTI spot prices are oversold, having fallen 30% from their peak.
• Oil futures jumped 9% on Friday night in a move that could turn into a relief rally.
• If momentum is confirmed we will enter a tactical trade for the MacroGrowth portfolio.

Fixed Interest Fixed beats floating every time

• Australians have materially decreased their investments in equities and increased their interest in deposits.
• How you articulate this shift is important to the volatility of your returns for any discreet period of time.
• Direct investing is best because there is nothing fixed about fixed interest funds.

Property 2012/13 capital city house price forecasts

• While the Australian housing market overall remains overvalued, performance over the coming year will not be uniform.
• Perth and Darwin are expected to be star performers over the next 12 months, each recording solid capital growth.
• On the other hand, Melbourne and Hobart are expected to experience significant declines due to worsening economic conditions and an oversupply of homes for sale and rent.

Special Report The great investor overhang

• Australian housing overvaluation is defined by one group above all others: negatively geared investors.
• Demographics show a concentration of losses in low and middle income groups.
• Tax statistics reveal the vulnerability by state.

Classroom Understanding FARM

• FARM is Macro Investor’s proprietary investment screening tool based on the four major factors – Fundamentals, Allocation, Risk and Macro.
• Over 600 securities are currently covered, including ASX200 stocks, ETFs, listed bonds, indices and over 100 microcaps, with more being added each week.
• We use over 100 separate variables in assessing value, risk, direction and future growth, back-tested in many cases to over 20 years.