The thing about valuations is that they don’t matter until they do. What do I mean by that? In the midst of a bull market, investors ignore valuations in the belief that earnings will rise in the future and therefore justify today’s higher values.
At time of writing, WiseTech Global Limited [ASX:WTC] shares are trading at $16.59, a whopping 9.59% down from yesterday’s trading price. No doubt, today’s fall comes from the extreme Wall Street sell-off that has taken place over the last 24 hours.
Overnight, US markets were belted with the S&P 500 slipping 3.3%, its biggest fall since 8 February 2018. The Dow Jones Industrial Average also copped a beating, losing 3.1%, also its biggest fall since 8 February 2018. There is a sense of frustration this morning as there is little agreement as to what comes next.
Individual small-caps, because of their tiny size, can move independently of the market. They can be driven by company-specific news, rather than the big global stories.
While the mainstream media portray Trump’s moves as ‘starting a trade war’, he is simply trying to level the playing field. Such a move will come at a cost though...
It almost seems that Buffett is trying to describe something everyone already knows. He’s very late to the smartphone wave, but he’s also generating billions from it. Being second means you have the luxury of investing with a whole lot more certainty.
Yes, the markets could crash. That’s why we have exit stops. It’s also why spreading risk is so important. These strategies aim to protect you from the worst scenarios. I believe the biggest risk is to avoid the market completely.
We’ve dodged the bullet this year. But we may want to start preparing for a crisis sometime between 2019 and 2021. Even one of the world’s most successful hedge fund managers, Ray Dalio, is getting ready.
Again, US-China trade tensions are all over the headlines. Now as you’re probably aware, tariffs are no good for anyone.
What’s going on with the gold price? In US dollars (the most important global benchmark), it’s trading just over US$1,200 an ounce, after being well above US$1,300 an ounce earlier in the year.