Ten Thousand Words - November 2018

Apparently, Confucius didn’t say “One Picture Worth Ten Thousand Words” after all. It was an advertisement in a 1920s trade journal for the use of images in advertisements on the sides of streetcars. Even without the credibility of Confucius behind it, we think this saying has merit. Each month we share a few charts or images we consider noteworthy.

This month, the stock price of listed hedge fund giant Och-Ziff shows that buying things just because they have plunged in price doesn't mean they will go up again; high-flying ASX listing with P/E multiples greater than 26x were the most heavily sold in October; while The Reformed Broker highlighted just how significant changes in P/E multiples are to returns; historic data shows there's no reason, based on seasonality, to expect a bounce in ASX small industrials in November; Pimco sets out how correlated with equities different debt instruments are;  and Stratfor charts out how the top 15 cities hold ~11% of the world's wealth.

Och-Ziff, the largest publicly traded hedge fund manager, peaked on its very first day of trading back in November 2007. It has since declined 92%.

Source: @charliebilello

October share price performance on the ASX sorted by Price-to-Earnings (PE) multiples (using earnings from the last 12 months) at the beginning of the month

Source: Equitable Investors, Sentieo

Contracting P/E multiples have undermined earnings growth in the US in 2018

Source: The Reformed Broker, WSJ, Bloomberg

S&P/ASX Small Industrials weekly returns over past five years - the number that were negative and average returns

Note: data through to late January 2018

Source: Iress, Equitable Investors

Correlation to equity markets of different sectors of the credit market

Source: Pimco

Mapping the World's Wealthiest Cities

The Top 15 Cities Globally Hold $24 Trillion in Wealth

Source: Stratfor

Popular posts from this blog

Feel the Cash Burn as Profit Season Closes (or "In memory of Pocketmail")

New commentary up on livewire: An overlooked small cap agri stock

We reckon equity is a key incentive


Nothing in this blog constitutes investment advice - or advice in any other field. Neither the information, commentary or any opinion contained in this blog constitutes a solicitation or offer by Equitable Investors Pty Ltd (Equitable Investors) or its affiliates to buy or sell any securities or other financial instruments. Nor shall any such security be offered or sold to any person in any jurisdiction in which such offer, solicitation, purchase, or sale would be unlawful under the securities laws of such jurisdiction.

The content of this blog should not be relied upon in making investment decisions.Any decisions based on information contained on this blog are the sole responsibility of the visitor. In exchange for using this blog, the visitor agree to indemnify Equitable Investors and hold Equitable Investors, its officers, directors, employees, affiliates, agents, licensors and suppliers harmless against any and all claims, losses, liability, costs and expenses (including but not limited to legal fees) arising from your use of this blog, from your violation of these Terms or from any decisions that the visitor makes based on such information.

This blog is for information purposes only and is not intended to be relied upon as a forecast, research or investment advice. The information on this blog does not constitute a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Although this material is based upon information that Equitable Investors considers reliable and endeavours to keep current, Equitable Investors does not assure that this material is accurate, current or complete, and it should not be relied upon as such. Any opinions expressed on this blog may change as subsequent conditions vary.

Equitable Investors does not warrant, either expressly or implied, the accuracy or completeness of the information, text, graphics, links or other items contained on this blog and does not warrant that the functions contained in this blog will be uninterrupted or error-free, that defects will be corrected, or that the blog will be free of viruses or other harmful components.Equitable Investors expressly disclaims all liability for errors and omissions in the materials on this blog and for the use or interpretation by others of information contained on the blog.