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Printed: 29 May 2024 6:34 AM

News

1 May 2024 - 10k Words | April 2024

By: Equitable Investors

10k Words

Equitable Investors

April 2024


Bond demand on the slide as inflation expectations climb and the equity risk premium hits a multi-decade low, with the correlation between equities and bond yields turning more negative. The largest stocks continue to crowd out the market. Over in Japan the key equities index has finally returned to its pre-1990 peak. More listed equity is being bought back than issued as IPO activity remains stagnant. Finally we look at shifting volatility and benchmark returns for the March quarter.

Biggest monthly drop in Fund Manager Survey bond allocation since July 2003

Source: Bank of America Global Fund Manager Survey

Market implied US inflation over the next five years

Source: Bloomberg, @lisaabramowicz1

US equity risk premium at a 22 year low

Source: Bloomberg

Rolling 2-month correlation between US equities & 10-year bond yields

 

Source: Morgan Stanley Research via @Schuldensuehner

Market cap of the largest stock relative to the 75th percentile stock

Source: @LanceRoberts, RIAAdvisors.com

Small cap stocks <4% of US equity market

Source: KobeissiLetter (data from CRSP, The University of Chicago Booth School of Business, Jefferies)

Japan's Nikkei 225 finally recovers to its 1999 record

Source: Equitable Investors, Koyfin

Net share issuance by companies on MSCI All Country World Index, adjusted for price and currency changes ($US billion)

Source: Financial Times

Global IPOs by quarter

Source: WSJ, Dealogic

Changes in US bond volatility (MOVE, RHS) v US equity (VIX, LHS) & Aus equity (ASX 200 VIX, LHS)

Source: Iress, Equitable Investors

Volatility benchmarks v average since July 2021 and move last week

Source: Iress, Equitable Investors

March Quarter (3 months) performance of key benchmarks and our "FIT" universe of ASX micro-to-mid caps

 

Source: Iress, GuruFocus, Equitable Investors

April 2024 Edition


Funds operated by this manager:

Equitable Investors Dragonfly Fund


Disclaimer

Past performance is not a reliable indicator of future performance. Fund returns are quoted net of all fees, expenses and accrued performance fees. Delivery of this report to a recipient should not be relied on as a representation that there has been no change since the preparation date in the affairs or financial condition of the Fund or the Trustee; or that the information contained in this report remains accurate or complete at any time after the preparation date. Equitable Investors Pty Ltd (EI) does not guarantee or make any representation or warranty as to the accuracy or completeness of the information in this report. To the extent permitted by law, EI disclaims all liability that may otherwise arise due to any information in this report being inaccurate or information being omitted. This report does not take into account the particular investment objectives, financial situation and needs of potential investors. Before making a decision to invest in the Fund the recipient should obtain professional advice. This report does not purport to contain all the information that the recipient may require to evaluate a possible investment in the Fund. The recipient should conduct their own independent analysis of the Fund and refer to the current Information Memorandum, which is available from EI.

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