10k Words - June 2020
Apparently, Confucius didn’t say “One Picture is 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.
On a day where the equities market is pulling back, we look at a snapshot of the surge in activity amid COVID-19 from small traders on discount broking platforms and "free" trading app Robinhood, via CNBC. Yet professional investors surveyed by BAML are holding the highest level of cash since the 9/11 terrorist attack. Leading into this selling, Evans & Partners' highlights record valuations for the ASX. Back to the US, we see via ValueLine how despite strong equity markets the median stock has gone nowhere for 23 years; while Greenlight Capital highlighted SocGen research that shows a significant valuation spread between stocks that correlate with bonds and those that don't. Where can central banks go from here? In Japan, the central bank has bought ~ 80% of ETFs. Over to consumers, where a survey in China showed continuing caution through to the end of April. Data from ASX-listed payments group Tyro, showed a similar trend in Australia at that time but by June transaction values were up year-on-year!
Surge in activity on "Free" trading app Robinhood amid COVID-19 pandemic
Source:CNBC, Robinhood, Counterpoint
Source: Evans & Partners
Source: Evans & Partners
Source: @jsblokland, Value Line
Source: Greenlight Capital, SG Cross Asset Research
Source: @Schuldensuehner, BOJ, Haver Analytics, Bloomberg, DB Global Research
Source: company
On a day where the equities market is pulling back, we look at a snapshot of the surge in activity amid COVID-19 from small traders on discount broking platforms and "free" trading app Robinhood, via CNBC. Yet professional investors surveyed by BAML are holding the highest level of cash since the 9/11 terrorist attack. Leading into this selling, Evans & Partners' highlights record valuations for the ASX. Back to the US, we see via ValueLine how despite strong equity markets the median stock has gone nowhere for 23 years; while Greenlight Capital highlighted SocGen research that shows a significant valuation spread between stocks that correlate with bonds and those that don't. Where can central banks go from here? In Japan, the central bank has bought ~ 80% of ETFs. Over to consumers, where a survey in China showed continuing caution through to the end of April. Data from ASX-listed payments group Tyro, showed a similar trend in Australia at that time but by June transaction values were up year-on-year!
Online broker new account openings surge amid COVID-19 pandemic
Source: FactSet, CNBCSurge in activity on "Free" trading app Robinhood amid COVID-19 pandemic
Source:CNBC, Robinhood, Counterpoint
Fund managers holding highest level off cash since 9/11 terrorist attack
Source: BAML Global Fund Manager Survey, May 2020
Source: BAML Global Fund Manager Survey, May 2020
ASX 200 PE at extreme level
Source: Evans & Partners
Source: Evans & Partners
Median US stock has gone nowhere for 23 years
Source: @jsblokland, Value Line
Stocks that correlate with bonds trade on 24x PE; stocks that don't trade on 8x
Source: Greenlight Capital, SG Cross Asset Research
Bank of Japan propping up stocks (% of ETFs purchased by the central bank)
Survey of Chinese consumer intentions
Source: Evans & Partners
Tyro Payments trading update shows return to growth in June
Source: company