Australian equities no longer leading the way
The correction experienced by the Australian equity market this year has meant it is no longer a leading market in comparison to the rest of the world, according to the chief investment officer of a fund manager specialising in domestic equities.
Speaking at an Australian Unity financial services presentation, head of Platypus Asset Management Don Williams said: “We can’t make claims that we [the local share market] will necessarily outperform the other markets by large amounts I don’t believe.”
In a positive for the domestic equities market he believes the correction is now over and should begin trading at levels experienced back in May of this year.
Williams revealed Platypus has identified a few areas of the market it thinks will perform well in the coming years including the consumer discretionary retail segment and the non-bank financial sector.
“The last retail sales number suggested an annual growth rate of about 6 per cent. During the property boom on the east coast retail sales grew at about 8 per cent over three years and the rate declined in late 2004 and 2005 to 2 to 3 per cent. So there’s been a good recovery there,” Williams said.
“We think the non-bank financials, despite the fact that it’s probably the most expensive part of the market at the moment, have legislative growth. In our view the top line growth in companies that are geared to essentially the superannuation legislation, and the health of financial markets generally, will be higher than healthcare for the next 10 years,” he added.
In regard to his own organisation’s joint venture arrangement with Australian Unity Investments finalised back in February this year, Williams was upbeat.
“It’s given us a lot more time to focus on investing. It’s allowed us to hire two more people and having more resources has improved the breadth and efficiency of our coverage. Also quite a bit of administration has left the office as well, so from our point of view so far it’s been a string of positives,” he said.
Recommended for you
Global X has painted a worrying picture for active ETFs in Australia, with investor adoption proving uneven and the popularity of its low-cost index counterparts only growing stronger.
Australian equity ETFs attracted record inflows of $3.2 billion in 1Q25, while heightened volatility led to a decline in flows for global equity ETFs, according to Vanguard.
The failure of a clinical trial by biotech firm Opthea has caused shares in its backer Regal Partners to decline 52 per cent year-to-date and hit its funds under management, quarterly flows show.
GQG Partners has revealed its quarterly flows for the first three months of 2025 were up 5.8 per cent, after a difficult final quarter of 2024 as a result of institutional redemptions.
