After a tumultuous 2020, the world is (slowly) beginning to recover. With two successful vaccines announced, and the virus largely quashed in Asia and the Pacific, the time for “lockdown stocks” is behind us, and the “recovery play” has begun. But the pace of recovery varies in different markets. While early progress from Europe’s lockdowns appears positive, the region has a long way to go. And the US has barely begun. But Australia is perfectly placed, with the virus under control both locally and for our biggest trading partner, China.
Jun Bei Liu, lead portfolio manager of the Tribeca Alpha Plus Fund, reckons that Australian equities “are in a pretty sweet spot, compared to global.” With consumer and business confidence rising, the de-leveraging of household and corporate balance sheets, and historically low rates, all the ingredients are there for a strong performance from Australian equities.
In this episode of The Rules of Investing podcast, we discuss the re-opening trade and how to get exposure to it, how the ‘barbell’ approach helps to maximise returns while managing risk, and Jun Bei shares a high quality company she’s recently added to the portfolio at a very attractive price.