Energy / Resources
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Why are we bearish on the oil price?
Andrew Macken
February 16, 2016
In this blog, we describe the framework for how we think about commodities and use it to explain why we believe the oil price will likely stay lower for longer. Montaka has a number of positions in the portfolio that will profit from such a scenario, on behalf of clients. continue…
by Andrew Macken Posted in Energy / Resources, Insightful Insights
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The Canaries in the Coal Mine
David Buckland
February 10, 2016
The severe decline in the commodities complex associated with slower economic growth, particularly from China, has seen Emerging Markets selling their holdings of US Treasuries in order to stop their currencies declining too rapidly. continue…
by David Buckland Posted in Energy / Resources, Insightful Insights
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The Steel Bears Are Winning – Part 2
David Buckland
February 5, 2016
Back on 16 March 2015, the conclusion from my blog entitled “China Dumping Steel Is A Cause For Concern” was global steel production had already reached a turning point. continue…
by David Buckland Posted in Energy / Resources, Insightful Insights
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Mean reversion
Russell Muldoon
December 5, 2015
A lot has been written about the woes of the resources sector recently with a similar amount of energy spent trying to work out when is the right time to expect ‘mean reversion’. A simple theory that although sounds complex, really just suggests that prices and returns eventually move back towards the mean or average as time periods are extended. Given the resource sector has been a material underperformer of late, the theory suggests you should reallocate a portion of your portfolio to such businesses in the expectation (or hope) that if such an event occurs, recent underperformance will lead to outperformance.
Sounds good in theory.
by Russell Muldoon Posted in Energy / Resources, Insightful Insights
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Outlook for Chinese steel: thumbs up or thumbs down?
Andrew Macken
November 19, 2015
Sometimes a picture tells a thousand words. This week, Macquarie published the latest instalment of their China Steel Survey that has been tracking Chinese steel sentiment since mid-2011. The question is simple: “Are you positive or negative on the market over the next three months?” continue…
by Andrew Macken Posted in Energy / Resources, Insightful Insights
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Australia’s most successful resource service company
David Buckland
November 18, 2015
Australia’s most successful Resource service company, Monadelphous Group Limited (ASX: MND), has seen its share price decline by 75 per cent from $28.50 in February 2013 to the current $6.80. continue…
by David Buckland Posted in Energy / Resources, Insightful Insights
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Too early to call the bottom on commodity cycle
Andrew Macken
October 30, 2015
For Australians, forecasting commodity prices is as much a national pastime as predicting the winner of the Rugby World Cup. In this column published in the Herald Sun, Andrew Macken discusses the significant decline in commodity prices over the past year. Have we reached the bottom of the cycle or will prices fall further still?
Click on the image below to read his piece entitled “Too early to call the bottom on commodity cycle”.
You can read all of the team’s press articles through browsing our media library, view more articles here.by Andrew Macken Posted in Energy / Resources, Insightful Insights
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Know Your Limits
Tim Kelley
October 20, 2015
Here’s a striking chart. It tracks the share price of BHP Billiton (ASX: BHP) over the past five years, together with the average analyst forecast for BHP’s FY16 Earnings Per Share (EPS) during that period. Unsurprisingly, the two have moved together. Also, changes to analyst forecasts have tended to follow changes to the share price. You might think it should be the other way around, but that’s a discussion for another time. continue…
by Tim Kelley Posted in Energy / Resources, Insightful Insights
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The Great China Slowdown (Part 2)
David Buckland
October 2, 2015
I have previously discussed China’s Industrial Profits declined 8.8 per cent in August from a year earlier, with the biggest fall concentrated in coal, oil and metals, according to the National Bureau of statistics. continue…
by David Buckland Posted in Energy / Resources, Insightful Insights
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Servicing debt after commodity prices have collapsed
David Buckland
October 1, 2015
Teck Resources, Canada’s largest diversified mining company, has been one of the larger “short positions” held in the Montaka Global Fund, so it was no surprise to the team at Montgomery when the credit rating of the miner was recently cut by Moody’s to junk bond status. continue…
by David Buckland Posted in Energy / Resources, Insightful Insights
