🔒 Boardroom Talk: Rallies may be suckers, so best to stick with Peche if you prefer peaceful sleeping

Have been doing quite a bit of reflection about the investments this week.

After interviewing London-based Sean Peche – whose Ranmore Fund now ranks in the top 1% of its peer group – I was ready to sell anything that looks even vaguely like a growth stock. Sean makes a compelling argument that the time for value investing is here and has only just begun. And who can resist buying a big brand like ABN Amro for 50c in the Euro?

A few hours later, another South African investment fundi who relocated abroad got me thinking differently. Anthony Ginsberg, who lives in Los Angeles, has built a splendid ETF business under the GinsGlobal brand. He’s convinced tech stocks are heavily oversold, and these fast growing businesses are now rated too low relative to stodgy alternatives.


Choosing between them isn’t easy, so best we defer to the Oubaas of Omaha. Warren Buffett says only invest in stocks that don’t disturb your sleep. Even though their ratings are appealing relative to where they were, our exponentially growing favourites are subject to the golden rule: Growth stocks don’t do well during upward interest rate cycles.

So best to remain circumspect about every rally, like last Thursday’s surge on better-than-expected inflation data. Until there’s a clear signal of a reversal, act as though the Bear is still on top. Exponential stocks may be cheap, but they can become cheaper still. And unless you’re comfortable with further ‘drawdowns’ (jargon word for price declines) or if there’s any chance you may need to liquidate to meet other needs, best stick with Peche.

More for you to read today: 

Upcoming webinars

Looking Ahead: Investing for 2024 with Alec Hogg
Following the resounding success of Alec’s recent roadshow with Standard Bank and an overwhelming number of requests from the tribe to access the presentation we’ve decided to set up a final webinar exclusive to Standard Bank and BizNews.

Click here to register to Join Alec as he looks forward to 2024 in light of the National Elections as he shares his views on how an investor can approach their portfolio given the potential outcomes of these upcoming elections.

The webinar will take place on Friday the 18th of November at 10h00, you need to register beforehand to attend. 

Monthly BizNews Share Portfolio Webinar
Alec will be giving us his monthly update on the recently restructured share portfolio, which saw a movement to onshore equities and an already pleasing set of results in its first month of performance. 

Click here to register to join Alec next Tuesday, the 22nd of November at 12h00. 

If you missed last month’s webinar and would like to catch up, you can find it here.

Purple’s future never looked brighter; SE Asia expansion to trump SA growth story – CEO Savage
Charles Savage was back in the BizNews studio after the release of the Purple Group’s full year earnings. In the interview with founder Alec Hogg, looking in his crystal ball Savage said the future has never been brighter despite it being a tricky time in the market for growth stocks, echoed by the demure movements in the group’s share price in spite of a stellar performance over the last 12 months. Noteworthy metrics from the annual report include a 50% increase in customers and the completion of 4 acquisitions, a feat not to be scoffed at coming from a relatively small team of operators. The team are pleased to have executed against their goals for the year and simply view investor’s subdued reactions as an indication of a tricky macro environment as opposed to doubts about future growth, especially when considering the intrinsic value that will be harvested from its recent investment in the Philippines, which Charles expects to be much bigger than its South African market. Considering that the team has come from a R20 million income statement 8 years ago, to a company of R2.5 billion today, it’s difficult to argue that investors won’t be richly rewarded by a global product offering and a sound strategy that is on track to realise local and international expansion. An exciting space to watch indeed.
Visited 44 times, 1 visit(s) today