OK so the pandemic is on again.
11,201 covid cases, case numbers have doubled in a couple of days.
Let's revisit the 21 stocks in the MGOC portfolio again.
which companies would you have?
probably the well known companies and brands
Microsoft, Facebook, Google, Netflix, Proctor and Gamble, Starbucks, Ali Baba, Visa, Mastercard, Mcdonalds, Lousie Vuitton
which stocks wouldn't you have?
All the stocks you haven't heard of ....
eg names like Crown Castle, Reckitt, WEC
well here is the logic behind their choice according to Hamish when he set up the portfolio
mentioned in the Magellan Global fund report of June 2020"we do not know the ultimate effect the coronavirus will have on society and the economy.
These investments offer attractive risk-adjusted returns under a wide range of potential economic outcomes.
They comprise:–
Consumer staples at 11% of the portfolio (Nestlé, PepsiCo and the UK-based Reckitt Benckiser).–
A communications infrastructure business and three regulated US utilities at 14% of the portfolio (Crown Castle International, Eversource Energy, Xcel Energy and WEC Energy).–
A pharmaceutical business, Novartis of Switzerland, at 4% of the portfolio.The core investment themes in our portfolio at 30 June 2020 were:■
A range of highly resilient businesses that represented 29% of the portfolio.
These businesses are largely unaffected by measures that have been enacted to combat the pandemic as their services are either essential or in increasing demand.
More importantly, these characteristics give these stocks a high degree of resiliency in a weak economy."
you either buy the argument or you don't?
It all depends if you think the market is over valued and a 20% correction is a afoot.
click here to hear Hamish talk about - a covid induced crash, Dotcom valuations and a possible hike in interest rates
(20min delay)