As we round out what’s been another interesting year for markets, we’re recapping some of the top insights from Chief Investment Officer Steve Johnson and the Forager team that investors found most interesting over the year…
Why inflation might return and why you need to worry about it
In his opening letter for 2021, Steve marvelled at the word “extraordinary” and explained why 2020 was an extraordinary year in terms of performance for both the Forager Australian Shares Fund and the Forager International Shares Fund. ‘It is an overused word,’ Steve shares. ‘It’s also an odd word, to me at least. Why does something that is unusual or infrequent have an extra amount of ordinary?’
Why this COVID-hit sector is still attractively priced
Steve and Alex Shevelev, Senior Analyst of the Australian Shares Fund, discuss the impacts of COVID on various market sectors, and the industry that surprised them the most. Hint: it wasn’t a home-furnishings boom. ‘Everything is easy to rationalise after the event. But the way different sectors were impacted by COVID surprised me – a lot,’ Steve reveals.
In his September quarter letter, Steve made the comparison between chess and investing, and explained why now’s not the time for a queen’s gambit – but a time to play the patient middle game instead. Steve wonders, ‘So how do we play this middle game? What’s the investing equivalent of that innocuous pawn move one square forward, or moving a key piece backwards?’
Steve and Harvey Migotti, Portfolio Manager for the Forager International Shares Fund, caught up to discuss psychological barriers, recognising re-entry points, and ego when it comes to making investment decisions. Harvey says, ‘I’m firmly grounded in valuation and data points. And if the data points get better than I expected or the price goes down and it’s just a confluence of all of these various factors and I happen to be looking at it, then you get to pull the trigger.’
The real message behind founder’s Dicker Data share sales
In this piece, Steve reflected on what the sale of $40 million worth of Dicker Data (ASX:DDR) shares might have really been saying about the business, and why the amount of money someone has outside their business is more important than the amount they have left in it. ‘In March of 2020, I had almost all of my assets invested in the Forager business and our two managed funds,’ says Steve. ‘If that all went to zero, I had less than $100,000 to my name. I don’t think about that.’
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