Don’t follow the herd into the market abyss

October 17, 2021

Writing a column for The Australian Financial Review, Tribeca’s lead portfolio manager Jun Bei Liu discusses the ‘wild ride’ the sharemarket has been on for the past 19 months.

The sharemarket has been on a wild ride for the past 19 months, from highs to lows and back again on the back of a medley of concerns from bulls and bears.

These day-to-day fears take in the possibility of uncontrollable inflation, imminent recession, breakdown of global trade, and of course,
let’s not forget the ongoing effects of the pandemic and the ever-present possibility of wars.

As an equity investor, the sharemarket can feel like a rollercoaster when every one of those fears is magnified through share prices. Despite being an investor for close to two decades, I still find myself wondering – has it always been like this?

The answer is yes. The sharemarket largely reflects company earnings and investor mood. Rationally, company earnings should determine the share price but sometimes investor mood can collectively overshadow any company’s performance. This leads to opportunities for astute investors who focus on the companies rather than their behavioural biases.

Click here to read the article.

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