Learn To Invest
Stocks Special Reports LICs Credit Funds ETFs Tools SMSFs
Video Archive Article Archive
News Stocks Special Reports Funds ETFs Features SMSFs Learn
About

News

Podcast: Investing Compass

Shani Jayamanne  |  09 Oct 2020Text size  Decrease  Increase  |  
Email to Friend

Welcome to Investing Compass, a new podcast series from Morningstar Australia. We’ll run through the fundamentals of investing, taking a deep dive of concepts and offer practical explanations, tools and resources that will allow you to invest confidently. 

 

Subscribe via your preferred platform

Episode 92: Share month: Deep dive into Fortescue

As part of share month, we take a deep dive into listener requested share, Fortescue.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Episode 91: Share month: Deep dive into A2 Milk

As part of share month, we take a deep dive into listener requested share, A2 Milk.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Episode 90: Share month: Deep dive into Tesla

As part of share month, we take a deep dive into highly requested Tesla.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Episode 89: The one thing you need to know to invest successfully

Math anxiety impacts around 50% of the population. Join us as we help ease this anxiety, and work through how math fits into successful investing.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

  • Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.
  • Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.
  • Tool: Portfolio projection calculator: See if you’re on track to reach your goals. If not, adjust the inputs to understand how you need to change your portfolio (or behaviour) to get there.
  • Tool: Asset allocation models: When trying to accomplish a goal, an investor constructs a portfolio made up of different types of asset classes such as cash, bonds and stocks. The question at the heart of portfolio construction is the decision on what asset classes to include and how much of each to include. This process is informed by comparing the risk and return requirements to accomplish the investor’s goal and the risk and return expectations of each asset class. Investors can choose between growth assets and defensive assets. The asset allocation models guide investors depending on what their required rate of return is.

Episode 88: Crypto crash and how low will the market go

We go through lessons from the crash of crypto coin Terra and a prediction of how far the market will fall. 

 

Episode 87: The case against ETFs

We all know the pros of ETFs - ease of access, trade intraday and in some cases, brokerage is free. So—we put up the case against ETFs.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Other reading and resources:

Episode 86: State of the market: May 2022

It seems like markets have been teetering on the edge, and have commenced falling. If past bear markets are anything to go by, we're not even halfway there yet. This episode looks at the current state of the market, and the context in which it should be viewed.

Our previous podcast episodes, Disaster Response: Equity Markets and A Sale Worth Skipping

 

Episode 85: Make your money last longer in retirement

In this episode, we take a look at the bucket withdrawal strategy, a withdrawal strategy that was developed because most people do not have an asset base to generate a passive income without dipping into capital. We explore what it is, how they are set up and what they contain.

Further reading and resources:

 

Episode 84: How to behave like a winner

Your behaviour impacts your returns more than you think. In this episode, we explore ways that you can increase your odds of better outcomes.

No resources this episode

 

Episode 83: Capital Allocation

Capital allocation is a significant determinant of the future outcomes of a company. This episode goes through the different capital allocation levers that companies can utilise, and how to tell if a potential investment is allocating capital in a way that benefits future outcomes for shareholders.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Episode 82: Taking a punt on CFDs

On this episode, we explore CFDs—Contracts for Difference. They're controversial investments that are facing scrutiny from regulators around the world—but investors keep using them. Do they have a place in your portfolio?

Other resources:

 

Episode 81: That’s a bit derivative

We explore derivatives—what they are, and how they can be used in your portfolio.

No resources this week

 

Episode 80: Under the hood of the ETFs you’re most likely to own

We take a look under the hood of the ASX200 and the S&P 500—what the top holdings are and what our analysts think of them. We also look at a couple of actively managed funds—Magellan Infrastructure (ASX:MICH) and Hyperion Global Growth Companies (ASX:HYGG)—where have these fundies taken their largest bets?

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Episode 79: The Equity Risk Premium

This episode covers the equity risk premium. We quantify how much you're compensated for the risk you take on when investing in shares.

No resources this week

 

Episode 78: Share deep dive: Kogan (ASX:KGN)

We do our second deep stock deep dive from Morningstar's March Best Idea List—this time, ASX-listed Kogan (ASX:KGN). We show investors what to look out for in quality stocks that may be out of favour with the market.

Sign-up for our Investing Fundamentals Course

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Episode 77: Ever wanted to own the world?

Think you know what it takes to be a passive investor? In this episode, we explore what a truly passive portfolio would look like, built with ETFs.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Further resources and reading:

We’ve launched two new webinar streams for accumulators, and pre-retirees and retirees. Register here: https://go.morningstar.com.au/content-premium-investing-fundamentals-2022-registration

 

Episode 76: Where do babies come from?

In this episode, we look at where returns come from.

Further reading and resources:

Bruce Springsteen, Glory Days

We’ve launched two new webinar streams for accumulators, and pre-retirees and retirees. Register here: https://go.morningstar.com.au/content-premium-investing-fundamentals-2022-registration

 

Episode 75: Book Review: Common Stocks, Uncommon Profits

We review Philip Fisher’s iconic book that has influenced their approach to growth stock investing for many professional investors.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Further reading and resources:

 

Episode 74: Deep dive on a share: Beyond Meat

We do a deep dive on Beyond Meat which is one of Morningstar's best share ideas.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Episode 73: Passive income

Mark speaks about his approach to generating passive income.

Sign-up for our Investing Fundamentals Course

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Episode 71 and 72: Passive Investing

In this two-part podcast (both released today), we take a deep dive into passive investing. In the first part, we discuss the evolution of passive investing, and why the line between passive and active is blurring. The second part explores how to pick a good passive ETF for your portfolio.

Sign-up for our Investing Fundamentals Course

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Episode 70: A 'sale' worth skipping  

If Reddit jumped off a bridge, would you? In this episode, we speak about two popular terms across social media and forums—'buying the dip' and 'shares on sale', and we explore whether the recent market drop is an opportunity for investors.

Sign-up for our Investing Fundamentals Course

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Episode 69: Disaster Response: Equity Markets

Militaries play war games and governments run disaster response exercises. We do the same with the teetering equity markets. 

Sign-up for our Investing Fundamentals Course

 

Episode 68: Yearly Portfolio Review

To finish off portfolio week, we're digging into our portfolios at our yearly portfolio review—revisting our goals, and seeing if we're on track.

Sign-up for our Investing Fundamentals Course

Further reading and resources:

 

Episode 67: Why you need to rethink your retirement goals

Morningstar's US Research team recently released a report declaring that the 4% rule should be revised to 3.3%. In this long-form episode, we discuss the findings of the report, why the assumptions in the study matter, and what investors can practically do to prepare for their retirement. 

Sign-up for our Investing Fundamentals Course

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Episode 66: Lessons from Great Investors

In this episode, we explore lessons from great investors and business people that we can apply to our own investing approach. 

Sign-up for our Investing Fundamentals Course

Further reading and resources:

 

Episode 65: Musings on the markets: 2021-2022

A different take from most, we take a typical Investing Compass look at the state of the market at the end of 2021. On behalf of Mark, Shani and Will, we wish you a Happy New Year and all the best for 2022.

No further resources. Happy New Year!

Sign-up for our Investing Fundamentals Course

 

Episode 64: Lessons from the Father of Value Investing

Our second book review looks at key lessons that we can take from the Intelligent Investor by Benjamin Graham. This book has been heralded as one of the most important investing books ever written, and one of Buffet's favourites (drink!).

Sign-up for our Investing Fundamentals Course

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Research: Link Administration Holdings (ASX:LNK) Analyst Report

Further reading and resources:

 

Episode 63: Making a list and checking it twice

We exchange the presents we got each other and explore gift ideas for investors in our annual Christmas episode 

Sign-up for our Investing Fundamentals Course

Further reading and resources:

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Some of Mark’s favourite investing books:

Book: The Future for Investors by Jeremy Siegel—this had a huge influence on my own investing approach. Makes some great points about how high expectations and the concept of a perfect scenarios being priced into the market can play out.

Book: The Intelligent Investor by Benjamin Graham—hard to be an investor and not read this book at some point.

Book: Common stocks and Uncommon Profits by Philip Fisher—another classic and probably the book that influenced my investing approach the most (I am in no way arguing that is something good to follow).

Book: Snowball by Alice Schroeder—There is a lot in here about his life (which I think makes it interesting) but it was a great book on Buffett

Book: The Warren Buffet Way by Robert Hagstrom—a classic on him. More directly related to investing than Snowball but also less interesting. Similar points to the intelligent investor but more approachable

Book: Contrarian Investment Strategies by David Dreman—Good foundational basis for investing.

Book: The Outsiders by William Thorndike—really can’t recommend this one enough. Focusing on how to deliver long term value as a CEO but obviously it helps with trying to identify these companies to buy.

Book: Against the Gods by Peter Bernstein—talks about risk which is obviously a pretty important topic for investing

Book: The Ascent of Money by Niall Ferguson—talks about the history of money, but really walks through financial history

Christmas party

 

Episode 62: Meeting a share IRL

A listener requested episode, we go through practical examples that put our three part share trilogy into practice. Understand how to choose between two businesses, and what to look for when investing in shares.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Episode 61: What's not to LIC?

A listener requested episode, we explore Listed Investment Companies. They've risen in popularity and their company structure offers distinct benefits for investors. We explore how they're structured, and how to spot a good one. 

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Episode 59 and 60: Exploring Alternative Lifestyles

In a two part series, we explore alternative investments and their place in your portfolio.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Episode 58: Breaking the internet: Bitcoin ETFs

We explore two phenomenons wrapped into one in Bitcoin ETFs, and whether your FOMO can be satiated with these relatively new products.

Our analysts don't rate Bitcoin or Bitcoin related ETFs. In lieu of research, we have instead provided wholesome content related to our conversation about pork nachos and Shani's new puppy Priscilla. 

 

Nachos picture 1

 Nachos picture 2

 

 

 

Episode 57: Let’s get real: Infrastructure and listed property

We explore real assets—as protection for your portfolio in an inflationary environment, and how these assets can fit into your portfolio more generally.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Episode 56: The misfits: A holistic look at portfolio construction

A listener requested episode, we look at where unlisted or non-traditional assets might fit into your asset allocation.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

  • Research: Vanguard Australian Shares ETF (ASX:VAS) Analyst Report
  • Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.
  • Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.
  • Tool: Portfolio projection calculator: See if you’re on track to reach your goals. If not, adjust the inputs to understand how you need to change your portfolio (or behaviour) to get there.
  • Tool: Asset allocation models: When trying to accomplish a goal, an investor constructs a portfolio made up of different types of asset classes such as cash, bonds and stocks. The question at the heart of portfolio construction is the decision on what asset classes to include and how much of each to include. This process is informed by comparing the risk and return requirements to accomplish the investor’s goal and the risk and return expectations of each asset class. Investors can choose between growth assets and defensive assets. The asset allocation models guide investors depending on what their required rate of return is.
  • Guide: Morningstar Guide to Selecting Investments: Knowing how to navigate your choices and weigh up different asset classes and styles of investing will ensure you’re heading in the right direction.

 

Episode 54 and 55: How super is your Super

A listener requested episode, we tackle superannuation in a mammoth two parter.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

  • Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.
  • Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.
  • Tool: Portfolio projection calculator: See if you’re on track to reach your goals. If not, adjust the inputs to understand how you need to change your portfolio (or behaviour) to get there.
  • Tool: Asset allocation models: When trying to accomplish a goal, an investor constructs a portfolio made up of different types of asset classes such as cash, bonds and stocks. The question at the heart of portfolio construction is the decision on what asset classes to include and how much of each to include. This process is informed by comparing the risk and return requirements to accomplish the investor’s goal and the risk and return expectations of each asset class. Investors can choose between growth assets and defensive assets. The asset allocation models guide investors depending on what their required rate of return is.
  • Guide: Morningstar Guide to Selecting Investments: Knowing how to navigate your choices and weigh up different asset classes and styles of investing will ensure you’re heading in the right direction.

Further reading and resources:

 

Episode 53: Taking stock: fund managers and their top picks

Our second episode taking stock of fund managers and their top picks is looking at some of Australia's biggest funds by size. We take a look at Orbis Global Equity Fund, Platinum International and T Rowe Price Global Equity. We stack them up against our Morningstar analysts, and see if they agree with where these managers have taken their biggest bets.  

We also check in on our original trio and their top holdings—Ark's Cathie Wood, Magellan's Hamish Douglass, and Morningstar's Australian Fund Manager of the Year, Hyperion Asset Management.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Episode 52: All about the Melbas

All about the Benjamins? Yeah, nah. Dame Nellie Melba graces the front of our $100 note, and was known as a stellar operatic soprano. In this episode, we belt out the case for cash at different stages of your investing journey. 

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Research: Vanguard Australian Shares ETF (ASX:VAS) Analyst Report

Research: Vanguard Australian Government Bond Index ETF (ASX: VGB) Analyst Report

 

Episode 50 and 51: A deep dive into ETFs

We take a deep dive on ETFs and explore what drives performance for these ever increasing vehicles.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Episode 49: The outsiders

In our first book review, we look at key lessons that we've pulled from William Thorndike's The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Success.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Further reading and resources:

  • Book: William Thorndike, The Outsiders: Eight Unconventional CEOs and their Radically Rational Blueprint for Success.

 

Episode 48: Finding a share that is right for you

The third part of the series on how to pick shares covers finding a share that is right for you.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Further reading and resources:

 

Episode 47: Fair value estimate

The second of our three-part series on how to pick shares covers valuing shares to find opportunities.

Further reading and resources:

 

Episode 46: How to evaluate a stock

The first of our three-part series on how to pick shares covers finding great businesses.

Morningstar Investor resources (requires a subscription or a free, four-week trial):

 

Episode 45: I guess you lose some and win some, as long as the outcome is income

We go through the factors to look out for in shares when trying to find sustainable income (and Shani finally gets her Drake lyrics into the episode title).

Morningstar Investor resources (requires a subscription or a free, four-week trial):

Guide: Morningstar Guide to Income Investing and Morningstar Guide to Income Investing in downturns: Discover trusted strategies to pick the right securities and build a successful income investing portfolio. Our guide to income investing in downturns shows how market falls throw into even starker relief the importance of the company balance sheet and how an understanding of it can help you create a portfolio with sustainable income

 

Episode 44: Cash rules everything around me

Are you a balance sheet? Are you an income statement? Are you confused by the question?

Further reading and resources:

Book: Liar’s Poker, Michael Lewis: is Michael Lewis’s first book when he talked about his experience on Wall Street. And he was talking about what all these very wealthy traders thought rich was. And rich to them was not a number, it was being able to afford the life they wanted on the income off of treasuries. And US treasuries are considered risk free so what they were saying was that if you could live the lifestyle you wanted off of interest from treasuries you were set for life and nothing could ever impact that lifestyle.

 

Episode 43: Turn your head and cough—time for your portfolio check-up

We walk through our mid-year portfolio review  to see if we need second jobs or are ready to retire.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.

Article: How to set up an emergency fund, Emma Rapaport

Tool: Asset allocation models: When trying to accomplish a goal, an investor constructs a portfolio made up of different types of asset classes such as cash, bonds and stocks. The question at the heart of portfolio construction is the decision on what asset classes to include and how much of each to include. This process is informed by comparing the risk and return requirements to accomplish the investor’s goal and the risk and return expectations of each asset class. Investors can choose between growth assets and defensive assets. The asset allocation models guide investors depending on what their required rate of return is.

 

Episode 42: If you can’t read the scoreboard, you don’t know the score

We explore how to measure success as an investor and advantages you have over professional investors

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Tool: Asset allocation models: When trying to accomplish a goal, an investor constructs a portfolio made up of different types of asset classes such as cash, bonds and stocks. The question at the heart of portfolio construction is the decision on what asset classes to include and how much of each to include. This process is informed by comparing the risk and return requirements to accomplish the investor’s goal and the risk and return expectations of each asset class. Investors can choose between growth assets and defensive assets. The asset allocation models guide investors depending on what their required rate of return is.

Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.

Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.

Research: Transurban Group (ASX:TCL) Analyst Report

 

Episode 40 and 41: Devine Intervention (part 1 & 2)

Why all investors need to pay attention to the impact of finfluencers. 

Further reading and resources:

Article: Dob in phoney advice from ‘finfluencers’, says ASIC, Aleks Vickovich

Book: The Future for Investors, Jeremy Siegel: to understand that successful investing isn’t about results but about how results compare to expectations

Book: The Intelligent Investor (Chapters 8 and 20), Benjamin Graham: Warren Buffett called chapters 8 and 20 the bedrock of his investing philosophy

Article: The Super Investors of Graham and Doddsville: it’s short, and you need to learn about value investing because chances are you will either become a militant adherent or make fun of them for being curmudgeonly antiques.

Book: The Outsiders, William Thorndike: it is good to now that you are investing in a real company and that being a contrarian might actually pay off.

 

Episode 39: Shortcut to index funds

Index funds, or passive funds are low-cost investments that are professionally managed—but there's no stock picking. We dive into the types of indexes, and speak about where they have historically performed well and added value for investors.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

 

Episode 38: Does anyone look good in platforms?

The rising cost of advice has increased the amount of self-advised investors, and also the number of platforms trying to suit their needs and fighting for their funds.  In this episode, we explore different micro-investing, broker and managed investment platforms, looking at the risks and trade offs for investors to consider.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

 

Episode 37: You down with ESG? (Yeah, you know me)

Sustainable investing is growing in popularity, yet there remains a lot of confusion on the topic. We tackle the different variations, break down whether it has impacted investment performance and the future of sustainable investing.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

 

Episode 36: Risky Business

Ever taken a Risk Tolerance Questionnaire? Thinking about risk in the wrong way can have profound impacts on your investing outcomes.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.

Tool: Asset allocation models: When trying to accomplish a goal, an investor constructs a portfolio made up of different types of asset classes such as cash, bonds and stocks. The question at the heart of portfolio construction is the decision on what asset classes to include and how much of each to include. This process is informed by comparing the risk and return requirements to accomplish the investor’s goal and the risk and return expectations of each asset class. Investors can choose between growth assets and defensive assets. The asset allocation models guide investors depending on what their required rate of return is.

 

Episode 35: Checking the barometer

We walk through considerations when deciding between active and passive strategies

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.

Further reading and resources:

  • Book: The Little Book of Common Sense Investing, John Bogle
  • Report: Active Passive Barometer report: A semi-annual report that measures the performance of U.S. active managers against their passive peers.

 

Episode 34: Living the theme

Thematic ETFs use compelling narratives to sell investments. We explore whether they are worth the hype.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

 

Episode 33: The four words every investor should know

We tackle whether a compelling story makes a compelling investment.

 

Episode 32: Special episode: Inflation

Consumer prices in the US surged in April this year by the most in any 12 month period since 2008.  This episode covers what’s happening at the moment, how the market are reacting and how to find robust companies that can withstand inflationary changes, or have measures in place to protect them.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

 

Episode 31: Are emerging markets worth the risk?

Jeremy Grantham recently said "Emerging markets in many ways are the growth that’s left in the system. They will guarantee to grow faster than the developed countries … they’re much cheaper, they haven’t been beat up, they don’t have as much speculative excess. They’re a respectable investment,”.  In this episode, we explore the opportunity and risk of emerging markets, and whether they have a place in your portfolio.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

 

Episode 30: Selecting investments to reach your goals

We go through Mark's decision-making process for how he has structured his portfolio to reach his goals.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.

Article: Journey through Bubbleville, Mark LaMonica: This is a three-part series that explores good-intentioned ignoramuses, self-interested manipulators and downright charlatans that have invaded investing markets. In the first part of our journey, Mark searches for signs of crazy investor behaviour. The second part explores the pay to play world of Instagram finfluencers and what happens when the teachers are only a couple pages ahead of the students. And finally, he looks at the long-term impact of getting started in investing during a bubble.

Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.

Guide: Morningstar Guide to Selecting Investments: Knowing how to navigate your choices and weigh up different asset classes and styles of investing will ensure you’re heading in the right direction.

Further reading and resources:

Webinar: Morningstar Investing Bootcamp: Preparing your portfolio for retirement—explores the bucketing strategy for retirement in further detail.

 

Episode 29: Bonds

We explore why bonds are worth paying attention to.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

 

Episode 28: How passive is passive investing?

We explore the risks of the increasing popularity of passive investing.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Further reading and resources:

  • Book: The Intelligent Investor, Benjamin Graham

 

Episode 27: Lessons from market crashes

Sometimes history repeats itself. Learn about past market crashes and see what lessons may apply today. We explore the nifty 50 and .com crash during this episode.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

 

Episode 26: Have market conditions impacted how much you need in retirement?

4% has been heralded as the amount you can safely draw down each year from your retirement savings. We explore whether market conditions have changed this standard, and how you should be thinking about retirement goals.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.

Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.

 

Episode 25: What are top fund managers holding?

We take a deep dive into the top holdings of Ark's Cathie Wood, Magellan's Hamish Douglass, and Morningstar's Australian Fund Manager of the Year, Hyperion Asset Management. We stack them up against our Morningstar analysts, and see if they agree with where these managers have taken their biggest bets.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Research: Hyperion Australian Growth Companies Analyst Report

Research: Xero (ASX:XRO) Analyst Report

Research: Tesla (NAS:TSLA) Analyst Report

Research: Magellan Global Fund Analyst Report

Research: Microsoft Corp Analyst (NAS:MSFT) Report

 

Episode 24: Morningstar take on Buy Now, Pay later

We zero in on Afterpay and Zip, exploring whether their current valuations are justified, and whether they'd make good long term investments.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Research: Afterpay (ASX:APT) Analyst Report

Research: Zip Co Ltd (ASX:Z1P) Analyst Report

 

Episode 23: Shortcut to Diversification

We explain diversification, why it's important for your portfolio, and why too much of it can also be detrimental.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Research: Magellan Global Fund Analyst Report

Further reading and resources:

Book: Investment analysis and portfolio management, Frank Reilly and Keith Brown (study on diversification)

 

Episode 22: SPACs (Special Purpose Acquisition Companies)

Is speculation getting out of control? Looking at the SPAC market may be an indication that we're in a bubble.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Article: Want to buy a SPAC? You might be the patsy—The touted investments tend not to end well for retail investors, Ruth Saldanha.

 

Episode 21: Tech stocks

Tech stocks have provided extremely attractive returns to investors, making up larger and more significant portions of market indices as they continue their growth.  We look at their business models, how they differ from the traditional, and their outlook.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

 

Episode 20: Is the market overvalued?

Market commentators have been heralding that the market is overvalued -we look at traditional indicators and where they sit compared to other significant market events like the GFC, Black Friday and the .com bubble. Then, we walk through how investors can find opportunities in these markets, and the strategies they should consider.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Research: Telstra (ASX:TLS) Analyst report

Tools: Monitor markets—view our price to fair values for regions and markets

Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.

Research: Morningstar Global Equity Best Ideas List (updated monthly)

Guide: Morningstar Guide to Share Investing: this guide will go through some of the ratios that we mentioned, and how to use it to find opportunities, or monitor your portfolio to understand whether it is time to sell. Of course, our analysts also take the heavy lifting out for you and do this analysis in our research reports.

Guide: Morningstar Guide to Portfolio Construction and Morningstar Guide to Selecting Investments: If you’ve gotten to the end of this episode and you’ve found that you don’t have a goal, plan or asset allocation to refer back to, it’s worth going back and setting up your foundations to succeed. These two guides walk through the process step by step and ensure that you have built your portfolio around your goals, instead of the other way around.

Further reading and resources:

Report: Morningstar study: Mind the Gap—The global Mind the Gap report digs into investor return gaps in key markets around the globe and analyses the factors contributing to each region’s trends.

 

Episode 19: Shortcut to Financial Statements:

We explore the balance sheet, cash flow statement and income statement. These are financial statements that you’ll find for any listed company, providing insights into their financial position and health. This episode will help you make more informed investing decisions based on what you can find on these statements.

 

Episode 18: Bitcoin

Bitcoin is a controversial topic that has split investors into three camps. Those that are fiercely for it, those that are fiercely against it, and those that don’t really understand it. This episode is for the third camp—we go through what Bitcoin is, where it came from and its mechanics, and then we put it into context as an investment.

Further reading and resources:

Book: The Intelligent Investor, Benjamin Graham: Ben Graham was the man that literally wrote the textbook on investing—and he wrote Security Analysis and later the Intelligent Investor based on his observations from the stock market crash which preceded and led to the great depression. Ben Graham spent some time talking about the difference between speculation and investing. He said that “You must never delude yourself into thinking that you’re investing when you’re speculating”. The difference is simple: an investor looks at a stock as part of a business and the stockholder as the owner of the business, while the speculator views himself as playing with expensive pieces of paper, with no intrinsic value. For the speculator, value is only determined by what someone will pay for the asset.

 

Episode 17: Shortcut to Asset Allocation

Our shortcut to asset allocation explores this concept which has been found to contribute to over 90% of your investment returns.

Tool: Asset allocation models: When trying to accomplish a goal, an investor constructs a portfolio made up of different types of asset classes such as cash, bonds and stocks. The question at the heart of portfolio construction is the decision on what asset classes to include and how much of each to include. This process is informed by comparing the risk and return requirements to accomplish the investor’s goal and the risk and return expectations of each asset class. Investors can choose between growth assets and defensive assets. The asset allocation models guide investors depending on what their required rate of return is.

Further reading and resources:

 

Episode 16: Morningstar take on the GameStop saga

A lot of people have made a lot of money in the last few weeks. Understand the mechanics behind GameStop, shorting and the impact of short squeezes in our special episode.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

 

Episode 15: International Investing

This episode covers why you should have international exposure in your portfolio, then move on to how to invest internationally, covering some of the nuances around investing outside of Australia including currency risk.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

 

Episode 14: Shortcut to Valuation

The price of the stock doesn't always necessarily reflect its value. Our shortcut episodes explores valuation and why it’s important to invest with it front of mind, instead of price.

Research: Morningstar Equity Methodology

 

Episode 13: How to Select Funds and ETFs

For our second episode on Funds and ETFs, we go through what to look for when selecting a fund and ETF by going through a practical example.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Research: iShares Core MSCI Wld Ex Aus ESG Ldrs ETF (ASX:IWLD) Analyst Report

Research: BetaShares Australia 200 ETF Analyst Report (ASX:A200)

Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.

Guide: Morningstar Guide to Fund Investing: Pooling funds with other investors allows you to access professional managers, who can put your money in hard-to-access asset classes, which in turn may also diversify your risk.

Guide: Morningstar Guide to ETF investing: Exchange-traded funds are an easy and affordable way to gain exposure to a range of local and international asset classes and thereby diversify your portfolio, but like all investments, there are risks you should be aware of.

Further reading and resources:

Report: Morningstar study: Mind the Gap—The global Mind the Gap report digs into investor return gaps in key markets around the globe and analyses the factors contributing to each region’s trends.

 

Episode 12: Shortcut to Alpha and Beta

We cover alpha and beta—two investing ratios that can help you understand the performance and volatility of investments.

 

Episode 11: How to construct an investment portfolio

Ever wonder how to pick your first investment, or whether your portfolio is going to get you to your end goal? We talk through a four-step framework to align your goals to your investment portfolio.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.

Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.

Tool: Portfolio projection calculator: See if you’re on track to reach your goals. If not, adjust the inputs to understand how you need to change your portfolio (or behaviour) to get there.

Tool: Asset allocation models: When trying to accomplish a goal, an investor constructs a portfolio made up of different types of asset classes such as cash, bonds and stocks. The question at the heart of portfolio construction is the decision on what asset classes to include and how much of each to include. This process is informed by comparing the risk and return requirements to accomplish the investor’s goal and the risk and return expectations of each asset class. Investors can choose between growth assets and defensive assets. The asset allocation models guide investors depending on what their required rate of return is.

Guide: Morningstar Guide to Selecting Investments: Knowing how to navigate your choices and weigh up different asset classes and styles of investing will ensure you’re heading in the right direction.

 

Episode 10: What to do before you start investing

Making sure you’re in a position to invest is like laying the foundations on a house.  In this episode, we run through what you need to ensure your foundations are solid, allowing you to invest confidently and for the long term.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.

Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.

Tool: Portfolio projection calculator: See if you’re on track to reach your goals. If not, adjust the inputs to understand how you need to change your portfolio (or behaviour) to get there.

Tool: Asset allocation models: When trying to accomplish a goal, an investor constructs a portfolio made up of different types of asset classes such as cash, bonds and stocks. The question at the heart of portfolio construction is the decision on what asset classes to include and how much of each to include. This process is informed by comparing the risk and return requirements to accomplish the investor’s goal and the risk and return expectations of each asset class. Investors can choose between growth assets and defensive assets. The asset allocation models guide investors depending on what their required rate of return is.

Further reading and resources:

 

Episode 9: Christmas Gift Ideas for Investors

Our Christmas episode goes through gifts you could give an investor at any part of their investing journey, from beginners to those who have been investing for decades. We'll go through some investments with low minimums, 3 stock ideas on our December Global Best Ideas List, and some books to further your knowledge.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

  • Research: Morningstar Global Equity Best Ideas List (updated monthly)
  • Research: Challenger (ASX:CGF) Analyst Report
  • Research: Westpac (ASX:WBC) Analyst Report
  • Research: Hanesbrands (NYSE:HBI) Analyst Report

Further reading and resources:

Book: The Little Book that Still Beats the Market, Joel Greenblatt: Greenblatt is an American investor and professor at Columbia Business School. He wrote this book so it was straight forward enough for his kids to understand. It introduces his Magic Formula to Investing which looks at findings shares with a high return on capital and high earnings yield. He also introduces some basic concepts so new investors can understand how they should think about evaluating the underlying companies.

Book: The Essays of Warren Buffett: Lessons for Corporate America: One of Warren’s many talents is that he can explain investing concepts in a straightforward manner. This is a big contrast from an industry that often makes things sound overly complex to try and intimidate people into thinking they need professional assistance. The Essays of Warren Buffet is just that—republishing some of his best essays that talk about investing of course but also several lessons on corporate America.

The Outsiders, William Thorndike: The book presents 8 case studies of CEOs and focuses on capital allocation decisions. Capital allocation refers to the decisions that companies make in deciding what they should do with cash that they either generate or raise from debt or equity markets. The importance of capital allocation decisions is underappreciated by many investors. At the end of the day owning a share is owning part of a business so the decisions management makes on what to do with the capital of a company is critical—because it is your capital. These decisions can be buying other businesses, investing in growth, paying dividends, paying down debt or buying back shares. The case studies in this book provide an interesting perspective on CEOs that took un-conventional approaches to capital allocation.

One up on Wall Street, Peter Lynch: Lynch was the portfolio manager for Fidelity’s Magellan fund which famously outperformed the S&P 500 for 11 straight years. One Up on Wall Street articulates Lynch’s investment philosophy which includes his famous call to invest in only what you understand. He also preaches that investors should do their homework and research an investment thoroughly and stresses that investors should focus more on a company's fundamentals than the market as a whole. Finally, Lynch encourages investors to focus on the long run and discard short-term market gyrations. All great lessons for investors who are trying to improve their knowledge.

Common Stocks, Uncommon Profits, Philip Fisher: This is a classic and talks about the 15 points that investors should look for when evaluating a company. Phil Fisher was focused on finding great companies that would compound investor’s wealth over the long term and his 15 points are a way to find well managed companies with great growth prospects.

The Intelligent Investor, Benjamin Graham: In some ways, this book is approachable, but having been written in 1949 means parts are outdated. Calling something timeless is a bit of a cliché but there are some concepts that are introduced in the book that have stood the test of time—the concept of Mr. Market and the notion that prices can vary significantly from value is the bedrock of investing. He also introduces the concept of margin of safety. Warren Buffett called chapters 8 and 20 the bedrock of his investing philosophy—do you need more of an endorsement than that?

 

Episode 8: Improving Investing Outcomes for Women

The importance of saving and investing is not gender-specific—it's critical for everyone. Some issues, however, disproportionately impact women—including poorer retirement outcomes, a bias in financial advice and the failure to invest. This episode covers these gaps that women disproportionately face with investing and retirement, and some practical tips to help even the playing field.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Guide: Morningstar Guide to Investing for Women Part I & Morningstar Guide to Investing for Women Part II: Women are less likely to invest than men, and when they do, they invest later in life, are beset by jargon and often receive inadequate advice.

Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.

Guide: Morningstar Guide to Better Investing Outcomes: Unlock the value of financial advice—whether you choose to use an adviser or not

Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.

Further reading and resources:

Guide: Guide to Investing for Women Part I

Tool: MoneySmart Superannuation calculator: Find out your super balance at retirement, and understand how fees will impact your balance.

Tool: MoneySmart Superannuation Contributions Optimiser: understand which type of contributions will give you the biggest boost

 

Episode 7: How do interest rates impact investments?

We've been in a prolonged period of falling interest rates since the mid-80s, having impacts on investment returns from different asset classes. This episode covers how investors should think about interest rates and monetary policy, and the impacts of falling and rising rates on investments.

Webinar: Morningstar Australia Investing Bootcamp: How interest rates impact asset values

 

Episode 6: Unlocking the value of financial advice (even if you’re self-advised)

This episode will help people who use financial advisers understand where they can actually add value and how you can protect yourself as a consumer. For those that don’t use a financial adviser -  we want you to understand how you can get some of the benefits that advisers can provide, even when you are investing on your own.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Tool: Goal calculator: Input your circumstances into the goal calculator to understand the required rate of return that is needed from your investments. This input then feeds into your asset allocation.

Tool: Portfolio projection calculator: See if you’re on track to reach your goals. If not, adjust the inputs to understand how you need to change your portfolio (or behaviour) to get there.

Tool: Asset allocation models: When trying to accomplish a goal, an investor constructs a portfolio made up of different types of asset classes such as cash, bonds and stocks. The question at the heart of portfolio construction is the decision on what asset classes to include and how much of each to include. This process is informed by comparing the risk and return requirements to accomplish the investor’s goal and the risk and return expectations of each asset class. Investors can choose between growth assets and defensive assets. The asset allocation models guide investors depending on what their required rate of return is.

Guide: Morningstar Guide to Investing for Women Part I & Morningstar Guide to Investing for Women Part II: Women are less likely to invest than men, and when they do, they invest later in life, are beset by jargon and often receive inadequate advice.

Guide: Morningstar Guide to Better Investing Outcomes: Unlock the value of financial advice —whether you choose to use an adviser or not.

 

Episode 5: Investing during the US Presidential Election

The US Presidential election promises to be chaotic in more ways than one. We run through how the election may cause volatility in your portfolio, what you should do about it, and whether now is the right time to invest.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Article: US Election scenarios and what they mean for investors, Morningstar Analysts

Article: What could we expect from a Biden presidency?, Dave Sekera

Article: Presidential elections don’t matter (for investments), John Rekenthaler

Guide: Morningstar Guide to Portfolio Construction: A 4 Step framework to build a portfolio that is aligned to your goals.

 

Episode 4: What are managed funds and ETFs?

As an investor, you will have different goals and objectives to the next person—stocks are not always the right solution. In this episode, we discuss managed funds and ETFs, which may suit investors who are just starting out, or investors looking to gain exposure to certain asset classes. We tackle some of the misinformation around these investment products and run through a few scenarios in which they may suit investors.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Guide: Morningstar Guide to Fund Investing: Pooling funds with other investors allows you to access professional managers, who can put your money in hard-to-access asset classes, which in turn may also diversify your risk.

Guide: Morningstar Guide to ETF investing: Exchange-traded funds are an easy and affordable way to gain exposure to a range of local and international asset classes and thereby diversify your portfolio, but like all investments, there are risks you should be aware of.

Further reading and resources:

Report: Active Passive Barometer report: A semi-annual report that measures the performance of U.S. active managers against their passive peers.

Book: The Little Book of Common-Sense Investing, John Bogle

 

Episode 3: Demystifying Investing Myths

We speak about if property beats stocks, whether ESG makes you trade performance for morals, or whether professional investors always know best. We run through becoming a more rational investor by taking a step back, and analysing investments based on whether they meet your goals.

Webinar: Morningstar Australia Investing Bootcamp webinar: Investing Myths. Mark covers a few more investing myths.

 

Episode 2: What is a dividend?

Dividends and distributions are cash payments from investments to investors. Learn what they are, how they can fit into your investment strategy, and the trade offs between current yield and future growth.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Guide: Morningstar Guide to Income Investing and Morningstar Guide to Income Investing in downturns: Discover trusted strategies to pick the right securities and build a successful income investing portfolio. Our guide to income investing in downturns shows how market falls throw into even starker relief the importance of the company balance sheet and how an understanding of it can help you create a portfolio with sustainable income.

Note: Morningstar Guide to Income Investing in Downturns contains a comprehensive illustration of the Transurban dividend example in the episode.

 

Episode 1: What is a share?

Share, stock, equity. What is it and how can it help you reach your goals? This episode will look at three key concepts—owning a share means owning a part of a business, shares and the stock market are two inherently different things and the long term drivers of returns: earnings growth, dividends and changes in valuation levels.

Morningstar Premium resources (requires a subscription or a free, four-week trial):

Guide: Morningstar Guide to Share Investing: Discover strategies to build wealth via share investing, benefits and risks of share investing and key Morningstar resources you can leverage to identify...

Guide: Morningstar Guide to Income Investing and Morningstar Guide to Income Investing in downturns: Discover trusted strategies to pick the right securities and build a successful income investing portfolio. Our guide to income investing in downturns shows how market falls throw into even starker relief the importance of the company balance sheet and how an understanding of it can help you create a portfolio with sustainable income.

Guide: Morningstar Guide to Selecting Investments: Knowing how to navigate your choices and weigh up different asset classes and styles of investing will ensure you’re heading in the right direction.

Further reading and resources:

  • Book: Common stocks, Uncommon profits, Philip Fisher
  • Book: The Little Book of Common-Sense Investing, John Bogle
  • Book: The Intelligent Investor, Benjamin Graham

is an investment specialist, Individual Investor, Morningstar Australia.

© 2022 Morningstar, Inc. All rights reserved. Neither Morningstar, its affiliates, nor the content providers guarantee the data or content contained herein to be accurate, complete or timely nor will they have any liability for its use or distribution. This information is to be used for personal, non-commercial purposes only. No reproduction is permitted without the prior written consent of Morningstar. Any general advice or 'regulated financial advice' under New Zealand law has been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), or its Authorised Representatives, and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. For more information, refer to our Financial Services Guide (AU) and Financial Advice Provider Disclosure Statement (NZ). Our publications, ratings and products should be viewed as an additional investment resource, not as your sole source of information. Morningstar’s full research reports are the source of any Morningstar Ratings and are available from Morningstar or your adviser. Past performance does not necessarily indicate a financial product's future performance. To obtain advice tailored to your situation, contact a licensed financial adviser. Some material is copyright and published under licence from ASX Operations Pty Ltd ACN 004 523 782. The article is current as at date of publication.

Email To Friend