articles by Tim Kelley
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Torpedo alert: the high-risk stocks we are avoiding right now
Tim Kelley
March 9, 2017
One of the unpleasant realities of equity market investing is that, from time to time, a portfolio company will deliver disappointing news and suffer a rapid and dramatic decline in market value. These “torpedo stocks” are not only psychologically painful, but can also impact significantly on returns. It is sometimes said that the secret to outperformance is less about finding the big winners, and more about steering clear of the big losers. Continue…
by Tim Kelley Posted in Editor's Pick, Market commentary, Montgomery News and Updates.
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Should you take Warren Buffett’s advice and opt for index funds?
Tim Kelley
March 1, 2017
You may have read the recent comments by Warren Buffet to Berkshire Hathaway shareholders about the merits of active fund management versus index funds. In short, Buffet’s advice for investors contemplating using active managers is: don’t do it; use low cost index funds instead. But is he right? Continue…
by Tim Kelley Posted in Market commentary.
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Reviewing Isentia
Tim Kelley
February 23, 2017
As many investors have noted, iSentia Limited (ASX: ISD) delivered a poor earnings announcement yesterday. The Montgomery Fund and Montgomery [Private] Fund both hold positions in ISD, and so this is clearly disappointing for us. The combined holdings amounted to less than 2% of the assets in those Funds before the announcement, so the damage was contained, but nonetheless, disappointing. Continue…
by Tim Kelley Posted in Companies.
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A quick review of reporting season
Tim Kelley
February 15, 2017
If we look at the overall market, the ASX200 Index is up close to 3% in the first two weeks of February, so across the overall market, the news so far appears to be pretty good. In this video Portfolio Manager Tim Kelley discusses a few stocks held in The Montgomery Fund.
by Tim Kelley Posted in Editor's Pick, Video Insights.
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When directors sell, should you sell too?
Tim Kelley
February 9, 2017
When directors buy or sell shares in their company, most people believe they are sending a strong signal to the market about the firm’s prospects. But how strong is the correlation between director trades and share price movements? And should you buy or sell because a director has too? We did some research to get closer to the truth. Continue…
by Tim Kelley Posted in Investing Education.
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Can a machine read company announcements?
Tim Kelley
January 31, 2017
Regular readers will know that our investment process takes advantage of quantitative analysis to identify potentially interesting investment opportunities. To do this analysis, we “train” a computer model to distinguish between strong and weak investment candidates using historical data, and then apply the resulting model to try to try to identify tomorrow’s successful investments. Continue…
by Tim Kelley Posted in Investing Education.
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Should you invest more in resources?
Tim Kelley
December 13, 2016
Resource stocks have enjoyed a stellar year. Anyone who invested in the sector at the start of the year is enjoying bumper returns, while those who did not are lagging badly. It begs the question: should you invest more heavily in resources stocks? Our short answer is “no”. And here’s why. Continue…
by Tim Kelley Posted in Energy / Resources.
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The UK could soon see stricter rules around CFDs
Tim Kelley
December 8, 2016
One path to profit in financial markets is to understand the cognitive biases that can make investors behave irrationally, and take advantage of their mistakes. For example, when prices are pushed out of alignment by panic selling or euphoric buying, a measured investor can try to benefit by taking the other side of the trade. Continue…
by Tim Kelley Posted in Global markets.
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It’s time to take advantage of mis-priced stocks
Tim Kelley
November 30, 2016
If the current market is shaking your confidence, don’t worry – you’re not alone. Right now we’re seeing many lower quality businesses being bid higher, while high quality businesses are getting hammered. Is this a rare opportunity to take advantage of mis-priced securities? We think so, provided you’re willing to ignore market noise and think longer term.
Continue…by Tim Kelley Posted in Market commentary.
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Quality Inversion
Tim Kelley
November 25, 2016
The Australian equity market has been unfriendly to our style of investing recently. We knew before we stepped onto the field that there would be years when we generated very large excess returns and years when we would suffer, but even when you know they will happen, the bad years are always painful when they occur. Continue…
by Tim Kelley Posted in Market commentary.
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