Investing solutions for the global investor: Event wrap-up

We’ve all heard how investment diversification is key to being a successful investor during volatile times. But how do investors actually go about increasing their exposure to international markets to achieve geographic diversification?

Answers to this and more were revealed during an event hosted by Sharesight in conjunction with Saxo Markets last night in Sydney, where Sharesight’s new Saxo Markets integration was also revealed.

At the event, Sharesight CEO Doug Morris shared insights on the exposure of Sharesight’s Australian users to international markets, and the role Sharesight’s performance and tax reporting plays as part of the complete suite of tools needed by global investors.

Saxo Markets’ CEO Adam Smith spoke to the demand from clients for integrations with fintechs like Sharesight, and Saxo Markets’ Market Strategist Eleanor Creagh explored the global macroeconomic themes shaping markets in 2019.

The importance of geographic diversification for investors

Doug’s presentation centred on the need for investors to invest globally and contrasted the relatively high rates of international exposure among Australian Sharesight users to the average figures across all investors in Australia.

How global are the investments of Sharesight users?

Australian Sharesight users (on paid plans):

* Median annual return 12%

* 74% Australian markets

* 10% US markets

Saxo Markets - Overview

Adam spoke about Saxo Markets, their history and global presence, relating the problem that many self-directed investors have with the tax side of the equation, and his excitement to be able to offer a tool like Sharesight to help Saxo Markets’ clients solve that problem.

Saxo Markets

• First digital access platform

• Covers the full spectrum of clients (DIY/HNW/SMSF/traders/asset managers, etc)

• 35,000 tradable products

• Ability to trade every asset class (if they don’t offer a particular investment, just ask)

• Clients from over 170 countries

• 16 offices globally (headquartered in Copenhagen, Denmark)

• SCMA (Saxo Capital Markets Australia) licenced by ASIC

An understanding of the macroeconomic outlook for global investors

Eleanor provided background on how Saxo Markets’ Strategy department operates. With teams based in each regional location, their highly nimble research house provides Saxo Markets’ clients with both local and global research and analysis.

2018 macroeconomic themes

2018 was a difficult year for investors, as most asset classes had low to negative returns by the year end -- due to a range of factors:

• Rising cost of money

• Fed tightening cycle

• Shrinking quantity of money

• Shrinking US $ liquidity

• Deglobalisation shock / trade wars

• Geopolitical coordination tapering off

• Rising uncertainty

2019 macroeconomic themes

False stabilisation in markets

• December 2018 sell-off shook investors

• Federal Reserve’s sudden u-turn in the direction of rates

• PMI peaked in Jan 2018 -- which usually has a lagged impact on consumers

• If historical PMI relationship holds up, consumer spending and sentiment to fall

• Cyclical downturn exacerbated by trade war tensions

• US$ rising -- tightens financial conditions globally

Late in the cycle

• Stay invested but manage late cycle risks

• Volatility on the rise

• Uncertainty everywhere

• Diversification will serve you well

• Ageing consumer/digitisation thematics

• Tail risk event chance is rising

• Markets appear to be front running -- stimulus expected to come later this year from central banks

• The 70th anniversary of the founding of the People's Republic of China is in October

• Therefore trade escalation risk between US/China likely to be low before then

The impact of rates

• Expecting more than a mid-cycle adjustment

• Central banks to ease rates

• Fed to cut in September... possibly also in October and December

• Passive investing is no longer in vogue

• Focus on capital preservation -- low beta minimum volume

• Gold long term might be a buying opportunity vs negative yield debt as a hedge against central bank quantitative easing

• Fixed income an option in an environment where rates are moving down

• US yields heading lower, US$ strength preventing reflation trade globally

Sharesight’s new Saxo Markets Integration

Concluding the event, Doug returned to the stage to unveil Sharesight’s new Saxo Markets Integration which allows Saxo Markets clients in Australia to easily sync their trading history to Sharesight simply by connecting their trading account through the integration.

Demonstrating how easy it is, Doug walked the audience through the process to import trades from a Saxo Markets account to a Sharesight portfolio, with the process taking less than 5 minutes before the trades were synced and he was able to run Sharesight’s CGT and taxable income reports on the portfolio.

Thanks to everyone who participated in, and attended this event. We look forward to hosting more in the very near future, stay tuned to our Facebook and Twitter feeds for more info!

Global investors love Sharesight

Sharesight was built for the needs of international investors like you, and makes it easy to keep track of your global portfolio. Here’s how:

• Automatically track your daily price & currency fluctuations, and handle corporate actions such as share splits.

• Run powerful tax reports built for Australian investors, including Capital Gains Tax, Unrealised Capital Gains, and Taxable Income

• See upcoming dividend payments with the Future Income Report.

• Get the full picture of your investment performance, including the impact of brokerage fees, dividends, and capital gains with Sharesight’s annualised performance calculation methodology.

FURTHER READING

• Should you invest in early-stage companies or VC funds?

• 8 tips to get your portfolio on track today

• Does your investment portfolio match your appetite for risk?

• 5 ways to maximise returns in a low-return world