Our Portfolio Manager and Partner, Ray David and our Blackwattle Investment Partners’ Large Cap Quality team, provide insights into current market movements.
Ray highlights that:
“Index changes and the growth of momentum investing is having a disproportionate impact on company valuations,” says Blackwattle Investment Partners portfolio manager Ray David, who carries around a chart from Macquarie that shows index funds now account for 22 per cent of ASX 200 ownership – up from 13 per cent a decade ago.
David says market prices are increasingly set by passive investment flows, thematic ETFs and larger wholesale pools of money, leading to things like the “irrational exuberance” at CBA. Active managers – kings of the market 10 or 20 years ago – have fallen in the pecking order. Surely, that affects share prices.
Please click the link to view more
Article
3 Jan 2025
