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August 2016
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This webinar contains information specifically intended for institutional clients, asset consultants, advisers, platforms and researchers, who are professional investors and wholesale clients (as defined in the Corporations Act 2001).
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Speaking at a media luncheon in Sydney yesterday, BAM chief investment officer Ned Bell noted almost 10 per cent of the companies that presently made up Australia’s S&P/ASX 300 index were vulnerable to being disrupted by agile new businesses that were redefining the corporate landscape.
“Australia is not immune to the global forces reshaping how consumers source and buy goods and services,” Bell said. “The disruptors are coming to Australia and they will bring products and services that are innovative and significantly change the user experience for the better, and they will negatively impact traditional players.”
He said the increasingly saturated nature of the Australian equity market had prompted many investors to turn their focus to offshore stocks in an attempt to achieve better portfolio balance and diversification.
However, he questioned whether the profit levels of modern day disruptors were sustainable.
“It makes sense to look around the globe for sound investment opportunities, but investors need to be aware of potential pitfalls,” he noted.
“The current changes we are witnessing in terms of disruptive new businesses is a good example of that.”
He said the firm’s investment philosophy rested on an “optimal combination” of excellent management, franchise strength, consistent profitability, financial strength and favourable business drivers.
That approach had helped ensure BAM outperformed the MSCI World ex Australia index by 2.6 per cent a year since 2003, and by 3.6 per cent over the 12 months to 30 June this year, he added.
“If history tells us anything, it’s that stock prices and earnings will eventually correlate … and high-quality companies outperform over the long term,” he said.
“In a disruptive world, franchise strength is imperative to how we think about companies and we need [to maintain] a view of how they [perform] over three to five years.”
Speaking at a media luncheon in Sydney yesterday, BAM chief investment officer Ned Bell noted almost 10 per cent of the companies that presently made up Australia’s S&P/ASX 300 index were vulnerable to being disrupted by agile new businesses that were redefining the corporate landscape.
“Australia is not immune to the global forces reshaping how consumers source and buy goods and services,” Bell said. “The disruptors are coming to Australia and they will bring products and services that are innovative and significantly change the user experience for the better, and they will negatively impact traditional players.”
He said the increasingly saturated nature of the Australian equity market had prompted many investors to turn their focus to offshore stocks in an attempt to achieve better portfolio balance and diversification.
However, he questioned whether the profit levels of modern day disruptors were sustainable.
“It makes sense to look around the globe for sound investment opportunities, but investors need to be aware of potential pitfalls,” he noted.
“The current changes we are witnessing in terms of disruptive new businesses is a good example of that.”
He said the firm’s investment philosophy rested on an “optimal combination” of excellent management, franchise strength, consistent profitability, financial strength and favourable business drivers.
That approach had helped ensure BAM outperformed the MSCI World ex Australia index by 2.6 per cent a year since 2003, and by 3.6 per cent over the 12 months to 30 June this year, he added.
“If history tells us anything, it’s that stock prices and earnings will eventually correlate … and high-quality companies outperform over the long term,” he said.
“In a disruptive world, franchise strength is imperative to how we think about companies and we need [to maintain] a view of how they [perform] over three to five years.”
