CBA and Wells Fargo: A Comparison of scandals

As most investors will be aware, the Commonwealth Bank of Australia (ASX:CBA) is currently under investigation from AUSTRAC for failing to adequately report cash deposits of over $10,000 to the authorities. They have allegedly breached this 53,000 times with a maximum penalty of $18m per breach. As a result, financial professionals have been answering a lot of phone calls from retirees and investors concerned about the financial position of the company.

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Eurozone blog

Could the Populist tsunami hit Europe, and what will be the catalyst?

 

Arguably since the formation of the Euro Monetary Zone, there has never been such a high threat to its survival as exists today. As the world has seen with the election of President Trump and Brexit, populism is gaining wider political support amongst Western democracies. In 2017 and beyond, this populist movement could have wide ramifications for European Union residents and also for the Farnam International Opportunities Portfolio.

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Dividend Yield

Australia’s Unyielding Pursuit of Dividends

In today’s ageing environment where super funds are collectively an enormous participant in the stock market, the hunt for yield can be unrelenting. Dividend stocks are highly sought after because they offer a consistent revenue stream of cash that is generally higher than both bonds and term deposits.

Compounding this desire is the availability of franking credits, whereby investors will receive a refund of the tax that has already been paid on the earnings related to the dividend. This is a unique tax law found only in Australia and a few other nations, but it increases the attractiveness of dividends as this tax refund effectively increases the yield of the dividend.

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wide world of investing

The Wide World of Equity Investing: Looking Beyond Australia

My colleague Luke Durbin recently wrote a great blog post on how a DIY investor can search for investment ideas on the ASX. It makes a lot of sense for an Australian investor to focus on ASX listed equities (particularly if their time or effort is limited) given that we have much better visibility and exposure to these Australian companies. Because of this we often can understand a company better, how they operate, what their market is and what their growth prospects are.

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stock chart ASX stricter IPOs

Should the ASX be stricter on tech IPOs?

The ASX is currently undertaking a public consultation for feedback on a proposal to place stricter regulations on small companies trying to list on the ASX, particularly those with little or no revenue. While the changes aren’t significant, it creates an interesting debate around what the role of the ASX should be between companies seeking capital, and the investing public willing to provide it.

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NBN Co TPG tin can

NBN Co’s Impact on TPG and the Telecommunications Industry

 

For the last few years the government-owned NBN Co has been busily building and selling their national broadband network (NBN) that is expected to bring Australia up to world internet standards. Whether or not this is accurate is not the point of this article, but to ask the question does the existence of a government controlled entity in a monopolistic position undermine the free market element of its economy?

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IPOs_that_have_tanked

What makes IPO’s Perform Poorly?

Recently on the blog we looked at the 2016 financial year IPOs that performed well and those that did not. When a new stock does well it is usually very easy to see the reasons why. Among other things, the reasons generally relate to a clear upward trajectory of earnings, a strong balance sheet, and minimal fluff from manegement. However, in amongst the prospectus, selective language, and colourful, upward trending graphs, it can often be more difficult to predict the losers before they happen. Using hindsight though, we can point to certain similarities that could help investors avoid these in the future.

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The Winners and Losers of FY2016 IPOs

With the end of the financial year approaching I decided to have a look back at all the new companies that listed on the ASX last year. By my count there were 111 new floats on the ASX so far this year (not including backdoor listings and including re-listings and demergers). So let’s have a quick look at some of the best and worst offerings and discuss potential strategies for the next financial year.

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driverless_cars

The on-coming disruption from driverless cars

While reading Josh Durbin’s great blog post on the lithium boom we are currently experiencing, I began thinking about the on-coming disruption that will come from electric vehicles. There is no doubt that as electric vehicles become as cheap as their petrol-based counterparts, we will see a worldwide trend towards electric vehicles and clean energy in general. Obviously this will cause massive disruption for the oil industry and car-makers who can’t adapt with an electric product, but while doing research on the topic I came across a much bigger disruption coming in the near future; driverless cars.

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