Platinum warns markets ‘more extreme’ than 2000

9 February 2022
| By Laura Dew |
image
image
expand image

Markets right now are even more extreme than they were in 2000, according to Platinum, with many perceived ‘safe’ stocks looking risky.

In an update to the $8.5 billion Platinum International fund, managers said 2000, the year that the dotcom bubble burst, was the best parallel for current markets.

This meant many stocks which were perceived as being ‘safe’ options were actually risky ones.

“What has appeared to many investors to be ‘safe’ could turn out to be very risky and vice versa. The closest parallel we can use to describe today’s markets is the year 2000. The only difference being that it’s more extreme.”

The Platinum International portfolio was dominated by companies in the decarbonisation, travel, technology and Chinese consumer while its short portfolio was dominated by those technology stocks which it viewed as being overpriced.

Top ten holdings included resources company Glencore, Samsung Electronics and Ping An Insurance Group.

The management team, made up of Andrew Clifford, Nikola Dvornak and Clay Smolinski, acknowledged this had led performance to be “languid”. Over one year to 31 January, the fund had returned 13.5% compared to returns of 23.3% by the MSCI All Country World index.

Performance had improved in the past quarter, however, with the fund returning 9.2% versus returns of 2.9% by the index.

“Our approach is about trying to avoid the hype, staying away from the crowd and we have talked at length about the risks in markets. While this has made us appear languid at times, it was a very deliberate approach which led us to enter this year very cautiously positioned on the basis that risks in markets were very asymmetric.”

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

GG

So shareholders lose a dividend plus have seen the erosion of value. Qantas decides to clawback remuneration from Alan ...

2 months 1 week ago
Denise Baker

This is why I left my last position. There was no interest in giving the client quality time, it was all about bumping ...

2 months 1 week ago
gonski

So the Hayne Royal Commission has left us with this. What a sad day for the financial planning industry. Clearly most ...

2 months 2 weeks ago

A Sydney-based financial adviser has been banned from providing financial services in the interest of consumer protection after failing to act on conduct concerns. ...

3 weeks 6 days ago

Insignia Financial has made four appointments, including three who have joined from TAL, to lead strategy and innovation in its retirement solutions for the MLC brand....

1 day 3 hours ago

ASIC has cancelled the AFSL of a $250 million Sydney fund manager, one of two AFSL cancellations announced by the corporate regulator....

3 weeks 4 days ago