Sydney Trading and Investment Expo takes place at the Sydney Convention Centre, 19th and 20th of July.
Did you know that BHP has a strategy for after the mining boom? BHP has spent the last few years acquiring resources that benefit from consumer activities rather than investment activities like construction and infrastructure. The first outward sign was in 2010 when BHP tried to buy Potash Corp in Canada. Potash is a fertiliser company and benefits from increasing protein consumption and food demand. In 2011 BHP bought Chesapeake’s shale gas assets another commodity which benefits from consumer driven activities.
Just like BHP, Decisive Asset Management believes investors should consider moving away from resource stocks to investing directly in the growth of spending by the emerging market consumer. As incomes rise in places like China the percentage spent on food and other discretionary items decreases making way for increased spend on discretionary items like travel and recreation. McKinsey estimates that spend on non-discretionary items in China will grow at a compound annual rate of 13.4% from 2010-2020.
Decisive Asset Management believes technology is one of the better ways to invest in emerging markets. The reasons being emerging markets tend not to have the existing habits and infrastructure that we have, this means they can more easily adopt and use new technology. Online retailing provides a good example with the leading Chinese e-commerce company Alibaba (which most of us might not have heard of) selling more than both Amazon and eBay combined and is growing at a much faster rate. The explosion in smartphone usage around the world means everyone is constantly connected to the internet. Australia itself has one of the highest smartphone usage rates in the world but as investors we tend not to invest in the industry.
So few Australians invest in overseas assets yet the US with their consumer and technology companies have the most potential for future gains. Recent statistics from the ATO’s overview of self-managed super funds (SMSFs) reveals that only 0.41% of superannuation assets are invested in international shares. This number includes amounts invested with overseas funds managers. These are companies that we all know and use every day as consumers, they should also be a part of your strategy after the mining boom. After all if BHP has a strategy for after the mining boom we all should too.
Decisive Asset Management
Decisive is a strategy for after the mining boom. We are focused on consumer and technology companies in the US to give investors exposure to the next growth opportunity while diversifying your portfolio. An international fund for Australian investors, Decisive helps balance portfolios towards the next stage of growth.
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