Markets set to see more negative effects if Labor wins office
The negative effects of the bear market are expected to be significantly worse if Labor wins office and Shorten and Bowen’s plans might have potentially dramatic implications for the equity and property markets, according to Wilson Asset Management’s chairman Geoff Wilson.
Further to that, the proposed plans might bring about the first economic recession in Australia for 27 years, he said.
Wilson reiterated that WAM was against Labor’s policy to scrap the current dividend imputation system and tax Australian shareholders twice.
“The ‘savings’ to be collected under Labor’s proposal will come from low-income earners and self-funded retirees with modest SMSF balances. Many of our 80,000 shareholders fall into this category and we will not rest until Labor drops the policy,” he said.
According to Wilson, the longest US bull market in history just entered its final stages while China’s equity market has fallen by nearly 30 per cent from its peak earlier this year and Australia has entered a technical correction.
“I believe we are in the final stages of the longest US bull market in history. What concerns me most is that all bear markets are extremely painful,” he said.
The firm also increased its listed investment companies’ (LIC) cash weightings to withstand increasing volatility and ensure necessary liquidity in its portfolios, which would help make it immune to the effects of an equity bear market.
AUTHOR
Oksana Patron
Recommended for you
Having launched its first active ETF for Australian investors earlier this year, iShares says this has helped the firm reach $50 billion in assets under management in Australia.
Recommending Platinum shareholders to enact the merger with L1 Capital, Morningstar has said it expects the combined firm will be able to moderate outflows and facilitate diversity in product range.
Elanor Commercial Property Fund has appealed to the Takeovers Panel regarding the takeover offer by family office Lederer Group, describing “disclosure deficiencies” in last month’s bidders statement.
Wholesale distribution is experiencing the most active hiring efforts as the decline in financial advisers means fund managers are focusing on high-net-worth investors and wealth managers instead.
