Quarterly Insights - April 2019

The Quarter in Review Global equity markets delivered the best first quarter since 1987, led by the US. Some initial signs of decelerating global economic data prompted the Fed and ECB to notably weaken their policy stances, likely contributing to a boost for some bond sensitive sectors but negative for the banking sector. The growth style once again outperformed the value style. One of the key drivers of the strong market bounce was the Fed and ECB sharply reversing course, returning to easier monetary policy stances.The Insync Capital Aware fund, after the cost of downside protection, delivered a return of 10.88% for the quarter compared to the benchmark return of 11.19%. (The Insync Quali

A not so krafty Kraft!

That’s not Heinz Big Red Tomato Sauce covering its financials The latest most remarkable evidence of disruption of a global titan can be found within the Consumer Staples sector; Kraft Heinz (KHC). This was yet another favourite stock of professional investors, particularly after Warren Buffet’s 27% investment in the company. Owned by the Brazilian private equity group ‘3G’ and Buffet, the management team rapidly merged low/no growth businesses, smashing costs out everywhere and chasing margin. The ‘Greed is Good’ speech of Gordon Gecko in the 1980’s Wall Street movie rings familiar. This approach saw innovation as an expense not an investment. Just 4% of sales spent on A&P (advertising & pr

Insync March 2019 Fund Commentary

Performance Commentary Markets had their best first quarter since 1998, led by the US, with most major global indices in the black. The UK and Chinese equity markets also performed well despite the ongoing Brexit and trade related uncertainty. The most notable influence on performance was likely the Fed, and to a smaller extent the ECB, where they notably softened their policy stances on some signs of decelerating global economic data. In fact, the Fed signalled it may not raise rates at all in 2019 which came as a significant surprise. From an investment style perspective, growth significantly outperformed value in Q1, a consistent feature of the market rally from the 2009 lows. Positive co

Harley Davidson rides into a crowd of Millennials!

Harley Davidson, once a stock market darling and come-back king faces trouble ahead with hard-hitting consequences for its shareholders. A demographic seismic shift is occurring with those aged 19-35 (Millennials) and their younger cousins - Centennials aged up to 18. Together they account for 57% of the global population and importantly hold a similar share of the workforce. Any company that assumes or ignores their values and consumption patterns will find themselves on the wrong side of disruption. Technology and environment awareness are deeply integrated into Millennials’ lives and habits. They’re also sceptical of governments and big business. Few of them desire the mass market product

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