5 Things You May Have Missed: Day One of the 2022 Morningstar Investment Conference

Check out what happened today

1. Tackling big picture: Geopolitical and inflation risks. London-based Managing Director, Co-Head of Multi-Asset and Head of US Equity of Lazard Asset Management Ron Temple joined us in our Sydney office for his opening keynote. ??Inflation is indeed the “topic of the day” said Ron who forecasts inflation in the United States to be around 3 to 3.5 per cent by 2023. He also sees the US as the epicentre of inflationary pressures as the “service sector bleeds into wage growth”. He believes that climate change is a “major economic and financial risk that is not discussed nearly enough” and will also add to inflationary pressures. What’s the implications for advisers? They will need to help their clients adapt to a new inflation paradigm. Ron identified a number of opportunities across the asset classes including finding the “sweet spot: in equities, attractive investments in EM debt and opportunities in alternative investments. For Ron, now is an “intriguing time” to be an investor.

2. Rising inflation and interest rates. Are we now seeing value? Head of equities Mathew Hodge is finding a number of opportunities in high-quality stocks at a discount given the market falls. Highlighting the graph above as in his presentation, Mat said that investors now have the chance to “put their money to work” despite the market still not being that cheap. He acknowledged that there are lot of concerns particularly around rising interest rates and inflation adding that the market “could get much worse before they get better”.

3. Where are the high-quality stocks among the rabble? Mathew was joined on a panel with Morningstar’s senior equity analysts Mark Taylor and Angus Hewitt who dug into some of their Best Stock Ideas. Mark’s stock coverage is the energy sector. The industry has already been impacted by energy pricings “going nuts” and the Russia-Ukraine war. With the challenge of an increasingly climate-conscious environment, Mark acknowledged that there are implications for energy companies despite being leveraged to the dynamic of higher energy prices, seeing upside for stocks like Woodside. Angus took a deep dive into his “mixed bag” of stock coverage including A2 – well positioned with its brand – and there is plenty to like in Lottery Company – the spinoff business from the Tabcorp demerger. The team will also be in-person at the conference on Thursday and are looking forward to pressing the flesh with the adviser community.

4. Looking behind the big investor trends. Franklin Templeton CEO Jenny Johnson took on the helm of the global fund manager just after it bought investment manager Legg Mason. Jenny spoke about how investor trends like passive investing and crypto have shaped the firm’s revived strategy and sees a “massive opportunity” with alternative investment managers. She also spoke about the benefits of having a truly diverse investment team who can uncover niches that “our biases may have missed”. Jenny believes that blockchain will be really significant to the industry, providing a platform that will make trusted transaction costs efficient, the implications and opportunities huge for the industry.

5 Access the conference and get your CPD accreditation

There is still time to register for our in-person event. A reminder that MICAU is CPD accredited. Just click here sign up to the event and you will also receive CPD accreditation at the end of the conference. Or if you would like to speak to one of our specialists, click here and one of the team will be in touch.