This gives me a feel for the movement of stock markets in the quarter ahead.
Over the last year the trend of global markets has been headed up and has increased again this quarter at a projected middle rate of 7.1% per annum. This just about keeps up with inflation. Here’s the projection and Keppler’s comments.
Click here for the 79 page Keppler Quarterly Developed Market update.
These statistics suggest that good value markets remain the best long term investment from a good value perspective.
A Benefit of Value Versus Growth For Me
Recently a friend of over six decades and I were in a Verizon store making changes to my cell phone plan. The agent serving me was a 25 year old gentleman with very fast thumbs. I commented on how I recall my friend and I, six decades ago, used to speak to one another on a party line. The Verizon agent looked confused and said “I don’t know that plan”.
I explained that we were speaking of land line party lines where multiple families shared one line and could listen in on one another’s calls.
I’m not sure he could grasp the concept.
Nor can I grasp the concept of much of the new disruptive technology that has entered our daily lives. At least I’m not inclined to spend the time required to grasp it.
In just six short decades we have seen innumerable changes in our productivity that have brought enormous economic growth. When we can spot how change in anything will alter productivity we can make really high return investments.
I have been fortunate to spot and be able to do this (spot how change will alter productivity) in real estate. Over the past six decades I invested (and recommended) investing in London, Isle of Man, Naples, Florida, Ecuador and Lake county Florida. Investments in real estate in these areas have skyrocketed far beyond any traditional growth pattern.
Yet each was a speculation. The investments were speculation based on experience yes, but still speculations.
The value investments we make using Keppler’s statistics are a diversification to protect what we have made.
It would be easy for me to get caught up in speculating in new technology such as AI, or quantum computers or new types of batteries. The profit potential is great BUT they must be viewed as speculations. And I do not understand the technology.
Value continues to be a market factor that is basic and understandable. Global value investing allows us to diversify in many currencies, in many markets and beyond the ability of scams as it relies on a fundamental of nature, “all things seek the maximum output with the minimal input”. That’s value.
Emerging Markets have Emerging Value.
Click here for the 52 page Keppler Emerging Market Quarterly Update.
Keppler wrote: “According to our analyses of the underlying fundamentals (book value, cash flow, earnings and dividends), the asset class emerging markets equities is now undervalued by more than one third compared with the developed markets. As the chart shows, only rarely in its 34-year history—at its inception, in the late 1990s and in the early 2000s—was the undervaluation as pronounced as it is now. There were also several periods when the ratio was above one. At those times, it was generally assumed that emerging markets equities deserve a valuation premium due to the higher expected growth rates of their fundamentals”.
Good investing to you.
