Albert Einstein is said to have called it the most powerful force in the universe, and John D Rockfeller named it the eighth wonder of the world. We call it compound interest. Why is it regarded so highly? Most of us studied compound interest at school, so we have a pretty good idea how it works. But it's not until you start looking at practical examples that you realise just how powerful it can be. Imagine you are 21 again. You [...]
Investment markets and key developments over the past week Shares had a positive week helped by mostly good economic data as the Chinese easing and expectations for more easing in Europe continued to impact. However, energy stocks were hammered as the global oil price plunged in response to a decision by the OPEC not to cut back production levels. US shares rose 0.7%, European shares gained 1.6%, Japanese shares rose 0.6% and Chinese shares surged 7.9%. Australian shares rose just 0.2% [...]
Investment markets and key developments over the past week Global shares appear to be in the midst of a significant correction which is likely to last until the current ‘event risks’ dissipate. America’s Ebola scare, Iraq’s deteriorating security situation, Hong Kong’s extended pro-democracy protests and Ukraine’s stalemate with Russia is seeing investors prefer the sidelines rather than the main game. Add to this volatile mix the prospect of the American central bank ending the quantitative easing program and European bank stress test [...]
On Wednesday we brought you 'The Story', a budget summary outlining the key proposals from Treasurer Joe Hockey’ s 2014-15 budget. Now the dust has begun to settle we bring you 'The Story Part 2' - What does it mean for you? How could the Budget proposals change the way you live, work and pay for services on a practical day-to-day level? Here’s a round-up of what the 2014-15 Federal Budget could mean for your family finances. As always, if you [...]
Investment markets and key developments over the past week The past week was mixed for share markets. US shares gained +1%, European shares rose +0.9% and Japanese shares rose +0.4%. Share prices were lifted by good economic and profit news. However, worries about Ukraine acted as a constraint, particularly as the week wore on. Chinese shares fell 0.5% and this weighed on some Asian markets. Australian shares also fell, down 1.3% with mining stocks slipping on the back of the falling iron [...]
Investment markets and key developments over the past week The past week has seen somewhat messy and mixed trading in share markets. Economic data has been mostly okay, there are hopes for some sort of stimulus in China and there has been no further escalation regarding Ukraine. While US shares fell -0.5%, shares gained +2.2% in Europe, +3.3% in Japan and +0.5% in Australia. Bonds rallied slightly, partly helped by a relaxation of fears that US Federal Reserve (Fed) tightening was coming [...]
Introduction Ever since major mining investment projects, such as Olympic Dam, started to be cancelled over a year ago and it became clear the mining investment boom was coming to an end, much uncertainty has surrounded the outlook for the Australian economy. This was not helped by a mediocre initial response to interest rate cuts and sub-par growth of around 2.3% annualised since the June quarter last year. Despite the economic uncertainty the Australian share market has lifted strongly – [...]
Lower cash rates and government bond yields have prompted a widespread hunt for income-producing investments. Although rates are likely to head up when the economy shows sustained signs of improvement, the yield climate will probably remain challenging for the foreseeable future. As a consequence, demand for investments such as dividend-paying stocks and investment-grade corporate bonds is likely to remain high. For an investor entering retirement, holding a well-diversified, managed portfolio will be key. Growth and defensive assets both play an important part of the [...]