James Marlay (from Livewiremarkets.com) interviews Matt Haupt, the lead portfolio manager of WAM Leaders (WLE), about how he has been positioning the LIC through this period, and what sectors he likes right now. He's turned bullish on the banks again. And he likes gold.
Disclosure: I hold WLE shares.
Matt Haupt is the lead portfolio manager of WAM Leaders (WLE) and he is one of the guests in the latest "Buy Hold Sell" segment recorded on Wednesday (26-Feb-2020) for Livewire Markets - in the middle of this past week (with its daily market sell-offs).
This one is titled: Stocks for sale: What these 2 fundies are buying
The other "fundie" is Ben Clark from TMS Capital, and he's been buying stocks that have been "Coronaed" like Wisetech and Sydney Airport. Ben also liked Invocare's result and he talked up IMF Bentham quite convincingly.
Matt thought the market got Amcor's result wrong, and Challenger's result surprised him by how good it was (Matt had sold out of Challenger prior to their result unfortunately, but he thinks they might buy back in if CGF keep pulling back along with the market). Matt also thought the big 4 bank's results surprised - on the upside, especially CBA, but he's still wary of the valuation. WLE has been topping up on resources stocks like FMG and RIO during the past week because they expect that China will likely stimulate via fixed asset investment to try to provide immediate stimulus, rather than the fiscal and other types of stimulus that take longer to work through the system, and fixed asset investment stimulus will create more demand for iron ore in particular, and base metals also.
They both discussed the impact of Covid-19, and how hard it is to try to guess or estimate what will likely happen - since there is such a wide range of possible outcomes. They also discussed cash levels in their respective funds.
Disclosure: I hold WLE shares. It is currently my preferred exposure to the larger cap stocks on the ASX - mostly ASX100 companies with some ASX200 companies as well. I personally mostly invest directly in companies further down the food chain where I believe I may have (or may be able to gain) an edge via research or experience over some who do less research or have less experience. For the vast majority of the larger companies on the ASX, there is far more focus on them from brokers, analysts and investors, and far less chance of serious mispricing of their shares. For exposure to the bulk of those larger cap stocks, I don't mind using an active fund manager like Matt Haupt at WAMG (Wilson Asset Management Group), who I've met a few times, spoken with, and have confidence in. His performance is improving and there's every chance that the NTA-discount in the SP of WLE will continue to narrow. In time, I would expect WLE to trade at around NTA, or possibly at an NTA-premium as WAM & WAX tend to do (two other LICs managed by WAMG). That gives you two ways to win. The SP can increase in line with performance, and it can increase further as the SP moves closer to the NTA of the fund. The same argument can be made for WGB (WAM Global), which I also hold. Catriona Burns is also doing a good job as the lead portfolio manager (PM) at WGB.
19-Nov-2019: November 2019 Shareholder Presentation
Note: This Presentation is related to the WAM Group (WAM Funds) + FG (Future Generation) Funds November 2019 Australian Roadshow (which I'll be attending here in Adelaide next Wednesday) and covers all of WAM Group's 6 LICs: WAM Global (WGB), WAM Leaders (WLE), WAM Capital (WAM), WAM Research (WAX), WAM Microcap (WMI) and WAM Active (WAA).
This one is for the Sydney leg of the roadshow, which includes their AGMs, but similar Presentations will be made at all of the venues they attend during the roadshow over the next couple of weeks.
WLE (WAM Leaders) is one of six LICs (Listed Investment Companies) managed by Wilson Asset Management Group (WAMG). WLE focusses on larger companies, predominantly in the ASX100, and most of their positions are in the ASX50.
They are currently (as at Friday 17th May 2019) trading at a 10% discount to their April 30th pre-tax NTA - which was $1.23. WLE closed on Friday at $1.105. It would be reasonable to expect a little bit of a rise today (Monday 20th May 2019) considering Labor has just lost the unlosable Federal Election, partly on the back of their policy of changing the refundability of franking credits for a large number of Australians. With the Libs now set to retain government, that issue has been put to bed for at least another 3 years (and quite probably longer), and WAMG's founder and CIO, Geoff Wilson, who is also the Chairman of WLE, was a very vocal opponent of Labor's failed policy on franking credit changes. He was the first to coin the phrase "Retirement Tax" which was picked up by most of the opponents to the policy and most of the independents and minor party senators who in most cases also pledged to vote against the changes should Labor win the election and try to introduce legislation to bring into effect their poorly thought out and badly structured policy (a little editorial licence here thank you, those views expressed here are not necessarily those of Strawman.com owners or staff or even necessarily the views of the majority of Strawman users, although I suspect that most people who hold dividend paying shares would prefer the status quo). Anyway, bank shares might have a little bounce today, as might Telstra and other stocks viewed as "yield" or "income" stocks. WLE, ARG, AFI, MLT and some of the larger LICs who hold bank shares and other large cap income stocks might also do reasonably well on the back of Labor's defeat. WLE look good here as long as you can buy them below their last reported NTA, and, as I said, they closed Friday at around 10% below their last reported NTA (net tangible asset backing).