Our three funds achieved returns between 9.8% and 22.9% in 2020. Considering the ASX 200 Index returned just 1.4% including dividends, we’ll mark that down as a solid pass. Monthly
reports for all three of our funds are below.
Despite the big recovery from the March lows, it was a wild ride in 2020. Many investors don’t enjoy that sort of thing. It’s the reason we try to make sure our funds can handle the
falls better than the market. If you only suffer half (or less) of the pain in the market falls, it’s a lot more comfortable. It also makes it so much easier to recover from, which is just as important.
In the United States, we believe investors have now fully taken leave of their senses. With very limited exceptions, we are avoiding exposure to US stocks wherever we can. We feel the
level of overvaluation is now at extremes not seen since the dot com boom of the 1990s. And we think it might end the same way. For US exposed investments, 2021 might be even more tumultuous than 2020. And we want no part of it. Below, in our Other Interesting
Stuff section, we talk more about some of the signs of US valuation extremes that we’re seeing.
Luckily, we don’t see the same craziness playing out here in Australia. Despite tech stocks at silly prices and many of the blue chip stocks in Australia being relatively expensive
again, we’re quite positive, for two reasons. Firstly, our recovery from 2020 is likely to be much smoother and quicker than most other places. And secondly, as we’ve talked about repeatedly, all our funds own a range of assets we feel are cheaper than they
should be. That doesn’t mean they won’t be affected in a market correction. But it does mean that over a 3-5 year period, prospects for making decent investment returns are very reasonable.
If you’d like to invest with us this month, you’ve got until Monday 25 January to apply for the Affluence Investment Fund or Affluence Small Company Fund. Affluence LIC Fund applications
must be completed by Friday 29 January. As always, go to our website and click the “Invest Now” button to apply online or download application/withdrawal forms. If you have any questions, simply reply to this email or give us a call at any time.
Finally, if you use Hub24, and you want to invest with us, we’ve got a favour to ask. Our Affluence Investment Fund is currently approved for the investment menu. We’re due to put it
forward for consideration for the Super menu in the next few weeks. If you would like to use our fund on Hub24 super, please reply to this email and let us know how much demand you might have. That will help us speed up the process.
Read on for our monthly Fund reports and other interesting stuff.
Daryl, Greg and the Affluence Team