Lauren Hua

Four ways to manage risk in your share portfolio

Mitigating risk is an important exercise for any investor in order to preserve capital. The main objective of any portfolio is maximum returns, however this can only be achieved if risk is managed correctly. In this article we outline four ways to reduce risk and therefore optimise performance. 1. Calculating beta One way to mitigate risk in the portfolio is the look at the beta of each stock. Beta measures how the stock fluctuates compared to the broader market. A …

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What are cyclical stocks and why are they important now?

It is important for investors to be able to distinguish which stocks on the Australian share market are “cyclical”. At certain phases of the economic cycle, cyclical stocks can under or overperform the market. This means that by identifying where we are in the cycle, and identifying which stocks are cyclical stocks, an investor can improve their portfolio returns. What are cyclical stocks? Cyclical stocks are stocks that move with the economic cycle. This means these stocks are affected by, …

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Reflation: What is it, and why you need to understand it

Reflation is an important term for investors to know. It is important to understand where we are in the business cycle as it can affect the performance of your share portfolio. In this article, we discuss what reflation is, how it is implemented, and the sectors which profit from these economic conditions. What is reflation? Reflation is a deliberate attempt to raise the general level of prices to achieve an economy at full employment and growth. In Australia, the Reserve …

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What are the characteristics of a high growth stock?

The term “high growth” is a description that has used ubiquitously in the financial media, but was does the term mean and what are the characteristics of high growth stocks? Definition A definition of a growth stock is one where investors see higher growth potential compared to the average market. As investors believe the company will grow significantly in the future, they are willing to pay an expensive price for the stock, which causes the share price to further accelerate. …

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What are the differences between listed and unlisted managed funds?

Managed funds have recently become very popular due to the automatic diversification they offer. Investors who do not have much experience in investing will also find these products useful as all the investment decision making has been done for them. Managed funds can be listed or unlisted. In this article we discuss the differences between the two. Listed Funds: These are funds which are listed on the Australian stock exchange and traded like shares. The price of listed funds changes …

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