David Moberley and James McBeath met each other on the first day of their professional careers as graduates at the Commonwealth Bank’s Future Leaders program.
By that time, he had moved internally at CBA to Colonial First State’s unlisted infrastructure asset unit in Sydney.just as the glory days of the millionaires factory came to a grinding halt. Since the fund’s inception in December 2022, Moberley says they are beating the broader market with low volatility and are outpacing returns from cash.
He says that dispersion is evident in the wide divergence in returns from companies in the same sectors, such ResMed and CSL, Coles and Woolworths, WiseTech and Altium, and among sectors with consumer stocks gaining 4 per cent while the broader market fell. The drop-off in trading volumes is also pressuring brokers and sell-side analysts are stretched thin – making it harder for them to get on top of their earnings forecasts that form the basis of the consensus earnings.“The value of those earnings numbers is probably reduced, but the pricing impact is more,” says Moberley, who as a former sell-side analyst sympathises with the difficulty of the task at hand.
Moberley says he’s worried by the fact that the equity risk premium in the United States – that is, the excess return from owning stocks over bonds – is a skinny 1 per cent. That is the lowest it’s been since the early 1970s.