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!


Online broker new account openings surge amid COVID-19 pandemic
Source: FactSet, CNBC



Surge 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



ASX 200 PE at extreme level

Source:  Evans & Partners




ASX PE even more extreme ex-financials & resources
 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)
Source: @Schuldensuehner, BOJ, Haver Analytics, Bloomberg, DB Global Research





Survey of Chinese consumer intentions
 Source:  Evans & Partners




Tyro Payments trading update shows return to growth in June

Source:  company

Popular posts from this blog

10k Words | August 2022

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

Where was the EPS uplift?

Disclaimer

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.