Investors can now invest alongside renowned stock market commentator, Marcus Padley, for the first time as he introduces two different investment strategies aimed at retail investors and advisors.
The strategies will each operate as a Separately Managed Account (SMA), and include:
- The Marcus Today SMA, an aggressive strategy investing in Australian equities for medium to long-term growth with some income
- The MT Equity Income SMA, which invests in Australian equities for regular, tax-effective income with competitive capital growth over the medium to long term
Mr Padley said the place for active management was important as the low interest rate, low growth environment continued. “All investors need to be asking where their next returns are coming from – the answer is not from the over-saturation of index trackers or from fixed income or cash.
“With almost zero inflation and zero interest rates likely to be with us for some time, investors need to be careful not to over-allocate to passive strategies which could gradually erode their capital.”
The SMAs were developed, in part, to service the clients of Marcus Today Investment Strategists (MTIS) Pty Ltd, which arose from a 2015 merger between the Marcus Today newsletter and financial advisory firm, Investment Strategists.
The Marcus Today stock market newsletter has provided investment tips and market insights since 1998 – while the opportunity to invest with Marcus is a first, Marcus Today has run model portfolios for several years. The Marcus Today Growth Portfolio has achieved an average annual return of 11.2% over the last 3 years and 12.6% over the last 12 months, compared to the S&P/ASX 300 Accumulation Index returns of 6.4% and 9.3% respectively.
He said the Marcus Today SMA will be concentrated, holding up to 20 stocks at one time, and that even conservative investors can benefit from its aggressive slant. “We have some safety mechanisms including the option to hold 100% cash if things get really hairy. But conservative investors including retirees still need performance, and stand to benefit from an allocation to growth.”
The MT Equity Income SMA aims to meet investor demand for consistent income, with some growth. “Income has become the holy grail for investors but we’ll also be looking for a growth kick where possible, which allows us to add value compared to the garden-variety income-generating equity funds.
“So while we will probably hold the banks and Telstra at various times there might also be a few surprises.”
Mr Padley said the SMA structure is SMSF-investor friendly due to the tax advantages. “Investing via SMA means the investors own the underlying stocks. This is attractive to SMSFs and investors in the pension phase, as they can utilise their own tax status and collect their own franking credits.
“SMAs also provide more transparency and opportunity for personal customisation.”
The SMA fee structures include a 10% fee on outperformance. “The performance fee means we only make money if we make money for our investors, which is how it should be.”
