Colonial First State’s Client Resources page has new client fact sheets to help you develop your financial knowledge. You may check out these topics below:
Tax tips and super strategies to help you prepare for the end of financial year
Boosting your super with the government co-contribution
ASIC is alerting investors of the existence of a number of fake green bonds.
In Australia, green bonds are not directly available to the general public or retail investors. Any website or entity claiming otherwise is a scam.
Scammers may represent themselves as well-known financial services firms and invite people to invest in fictitious environmentally sustainable green bonds.
ASIC is aware of the existence of a number of fake green bonds. Green bonds are bonds that are used to finance new and existing projects that offer climate change and environmental benefits. They can be purchased by superannuation funds, fund managers, insurance companies and other wholesale entities, but are not directly available to the public.
Lower tax on your investments can help you reach your financial goals sooner. But don't choose an investment based on tax benefits alone.
You need to include investment income in your tax return. This includes what you earn in:
interest
dividends
rent
managed funds distributions
capital gains from property, shares and cryptocurrencies
After many years of underperformance, 2022 could finally be the year that Australian shares outperform the US market, thanks to higher commodity prices and heavy falls in technology stocks.
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The Oracle of Omaha's latest annual letter is full of lessons for investors, including waiting for value, keeping a buffer, trusting the quality of your investments, and recognising new and important trends.
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ASIC is alerting consumers to a rise in investment scams impersonating companies or financial investment firms.
Scammers often make contact through Gmail and Outlook email accounts.
Contact details of the scammers do not match the information published on the legitimate company’s website.
Inspiring, leading and continuously adapting to change is no easy feat and can often lead to change fatigue. Ciara Lancaster shares her six pillars for turning change fatigue into change success.
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2022 is not very old and already it has seen a stock market correction, a 50bp flattening of the US yield curve and a major geopolitical crisis in Europe. Investors are contemplating the potential consequences of the Russian invasion of Ukraine, and the direct economic impacts here are minor as the world’s trade and financial linkages with Eastern Europe are very low. However, the indirect impact through higher commodity prices (energy, metals, and food) to consumer’s purchasing power is far more significant and simply adds more impulse to already well-established upward trend in global inflation, as well as downside risks to growth.
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It gives me pain to hear the finance industry telling people to invest in 'balanced' portfolios to reduce risk. At no stage do they ever tell people the opportunity cost so they repeat the same mistakes.
Memory loss can make it difficult to stay in control of your money. Things like checking bank statements or investments, or paying bills may become challenging.
If you're starting to struggle, it's time to put some safeguards in place. A few simple steps will help you and your loved ones protect your money and prepare for the future.
Start planning
Appoint an enduring power of attorney
Update your will
Get your super in order
Sort out your important documents
Protect yourself from financial abuse
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The attached note covers the main questions investors commonly have regarding the investment outlook in a simple Q&A format. The key points are as follows:
Inflation will likely slow later this year but remain well above pre-pandemic levels over the medium term.
Wages growth is likely to pick up to 3% this year.
A Russian invasion of Ukraine risks a short term hit to shares followed by recovery over the next 3 to 12 months.
Australian home prices are likely to peak later this year followed by falls into 2024.
Given the rough start to the year in share markets, the attached note looks at past bear markets in Australian and US shares. The key points are as follows:
While share market corrections and even mild bear markets are common, long and deep bear markets invariably require a recession at least in the US.
Global and Australian shares have had a good rebound from their January lows but could still fall further in the short term as risks remain high around monetary tightening and geopolitical tensions.
However, a deep bear market is unlikely as a US, global and/or Australian recession are unlikely to be imminent.
Australians who are being subject to online abuse will be able to report incidents to the eSafety commissioner under sweeping new powers now in force.
New online safety laws will make social media giants remove posts deemed as bullying or abusive within 24 hours.
If the posts are not taken down, individuals could face fines of up to $111,000 or companies could be hit with a $555,000 fine.
Communications Minister Paul Fletcher said the new laws would target online trolls.
“We now have new protections for Australians who are subject to vicious, online abuse,” Mr Fletcher told the Seven Network on Monday.
“What we know is that people who are the victim of this, what they want most of all is to have the material taken down as quickly as possible.”
As part of the new laws, people who are abused or harassed online should first report the offending post to the social media company it was published on.
Should the company not take down the post, people would be able to report the incident to the eSafety commissioner, who has new powers to mandate the post be removed within 24 hours.
Deputy Prime Minister Barnaby Joyce said the social media companies needed to be held accountable for the content posted to their platforms.
“The vindictive nastiness has to be brought under control, and the people who have to control it are the people making money out of it,” he told the Seven Network.
“The premise should remain with the person who makes the money, and that is Facebook and Instagram.”
However, Labor backbencher Joel Fitzgibbon said the new laws would not have much of an impact.
“The impact of bullying on the playground is immediate, no matter where it occurs, but in the playground, you get kicked out of the play area,” he said.
“This is not kicking anyone off social media, I am not sure whether that is legally or technically possible.”
It comes as the government is holding a federal inquiry into online safety, where representatives from some of the world’s biggest social media companies have been questioned.
Other legislation is being debated on whether social media companies would be forced to identify anonymous trolls.
Andrew Brown
(Australian Associated Press)
The attached note looks at the RBA's first meeting for this year and the outlook for the official cash rate. The key points are as follows:
The RBA will end quantitative easing this month.
While it now sees unemployment falling below 4% and higher inflation it is prepared to be "patient" for now on rates.
We expect rate hikes to commence in August.
Ultimately, we see the cash rate rising to around 1.5 to 2% in the years ahead but it's a bit of guess and the RBA will only raise rates as far as necessary to cool inflation.
Rate hikes from later this year are unlikely to be enough to threaten the economic recovery but they will add to the slowdown in the property market where we see dwelling prices peaking later this year.
The attached note takes a look at the recent sharp falls in share markets and looks at seven things for investors to keep in mind. The key points are as follows:
Share markets have fallen in recent weeks on the back of worries about inflation, monetary tightening, the Omicron disruption and the rising risk of a Russian invasion of Ukraine.
Its too early to say markets have bottomed.
Key things for investors to bear in mind are that: corrections are healthy and normal; in the absence of a renewed recession share market falls may be limited; selling shares after a fall locks in a loss; share pullbacks provide opportunities for investors to buy them more cheaply; shares continue to offer an attractive income flow; shares often bottom at the point of maximum bearishness; and finally, to avoid getting thrown off a long-term investment strategy it's best to turn down the noise.
The attached note takes a look at the continuing surge in global inflation pressures, notably in the US. The key points are as follows:
Inflation is placing increasing pressure on major central banks to remove monetary stimulus.
Inflation & rising interest rates will likely contribute to more volatile & constrained investment returns this year..
The long-term downtrend in inflation and interest rates since the early 1980s is likely to be over removing a tailwind for investment returns.
The attached note provides a simple point form summary of key insights and views on the economic and investment outlook. The key points are as follows:
2021 saw strong investment returns with low volatility.
2022 is likely to see more constrained returns with increased volatility.
Watch: coronavirus and vaccines; inflation; the US mid-term elections; China issues; Russian tensions with Ukraine and the west; & the Australian election.
As business fundamentals improve, the earnings recovery takes over as the primary driver of shareholder returns. The equity market is supported by its real earnings even with the inevitable share price falls.
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Most people entering retirement do not see a financial adviser, mainly due to cost. It's a major problem because there are small mistakes a retiree can make which are expensive and avoidable if a few tips were known.
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For 40 years, recording the market's X-Factor has become an obsession. In weighing up four big candidates for the most likely X-Factor emerging from 2021 and likely to hit in 2022, there is a clear winner.
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