2 November 2017 · 5 min read

Government bonds in the firing line

The next twist in the story is likely to push global yields higher

It is always important to put aside preconceptions and let all the data speak – and not just that which confirms prior beliefs. At present, the data which best models the long-term outlook (valuations) are suggestive of relatively weak returns in global equities and this has informed our cautious positioning. Furthermore, bond yields and interest rates remain unusually low on a historical basis. Yet for the short-term, economic surprises are currently positive, business sentiment strong and profits growth relatively robust. It is this short-term data which also needs to be heard.

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Richard Windsor
1 November 2017

Razer - The public game

Razer, too early to go public

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Sarah Godfrey
31 October 2017 · 2 min read

HBM Healthcare Investments top holding AAA receives takeover bid from Novartis

Tender offer for 100% of radiotherapeutic oncology specialist Advanced Accelerator Applications at 25% premium to 30 September valuation

Switzerland-based global healthcare giant Novartis has announced a takeover bid for Advanced Accelerator Applications (AAA), the largest holding of specialist investment fund HBM Healthcare Investments (HBMN). The deal values AAA, whose Lutathera treatment for neuroendocrine tumours was granted EU approval in September 2017, at US$3.9bn.

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Richard Windsor
31 October 2017

Facebook, fake news

“There is in fact a silver bullet but the real problem that Facebook has is that it has no idea how to make it”

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Mel Jenner
27 October 2017 · 2 min read

Witan Investment Trust announces the appointment of two European equity managers

Appointment of CRUX Asset Management and S. W. Mitchell Capital

Witan Investment Trust (WTAN) has announced the appointment of two European equity managers: CRUX Asset Management and S. W. Mitchell Capital. CRUX is a specialist asset management company with an emphasis on European equities and S. W. Mitchell is an investment boutique focused exclusively on European equities. Each manager has been allocated c 5% of WTAN’s assets (c £100m), funded by the liquidation of the pan-European portfolio that had been managed by Marathon Asset Management, plus an additional £24m from WTAN’s cash resources. Both portfolios will be benchmarked against the FTSE Europe ex-UK index. Following the transition, WTAN will have 10 external managers, each running regional, high-conviction mandates. WTAN’s executive team will continue to manage up to 10% of the trust’s assets in collective funds.

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Richard Windsor
26 October 2017

Tokyo Motor Show

The star of the Tokyo Motor Show is an electric sports vehicle designed by Toyota which has at its heart an assistant which neither Honda nor any other automaker has any chance of ever creating themselves.

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Richard Windsor
25 October 2017

Essential Products is clearly struggling with its Essential Phone which will lead to it focusing on

Essential Products is clearly struggling with its Essential Phone which we think will probably lead to it ending up focusing on the smart home only. Essential Products Inc. has used the only competitive weapon it ever really had and has cut the price of its flagship Essential smartphone by 29% from $699 to $499. Those that have already purchased the device will get a $200 credit towards purchasing other devices within the Essential ecosystem such as the 360 camera. The issue with this is it will really annoy fans of the device who paid full price and it is also an admission that there is nothing particularly special about this device leaving Essential Products in the same boat as everyone else in terms of competing on price. This is a real climb down for the company because competing directly with the Chinese and LG directly on price, it means that the user experience and ecosystem that it spent so much time creating is getting no traction with users. This fits exactly with our previous observation that Essential Products has created a great Google phone and nothing more.

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Richard Windsor
23 October 2017

Microsoft, Huawei & ZTE -Hardware heaven?

3 big leaps but potentially with fatal flaws

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19 October 2017 · 1 min read

Profits forecasts stable – but no positive surprises

Stronger PMI indices not following through to profits growth

While Q3 has brought something of a renaissance in economic surprise and purchasing managers’ indices we can at present see no sign of this improved sentiment in profits forecasts for 2017. Our weighted average consensus earnings forecast index remains steady for each of the UK, US and Europe ex-UK and the equal-weighted measures have declined, if modestly, since mid-year. In prior periods, our earnings forecast index tended to move slightly ahead of PMIs and economic surprise. The more recent data has not followed this pattern and highlights that what is good for the overall economy is not by necessity good for corporate profits. Furthermore, with central banks on a tightening path the risk for equity markets is that tighter policy is not offset by stronger profits growth.

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Richard Windsor
18 October 2017

Broadcast TV - Sword of Damocles pt. III

OTA broadcast given a second chance

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