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Author: Provision Wealth

Five charts and a table that are critical to watch regarding the global economy and markets this year

Date: Feb 21st, 2019

I first ran through a set of five charts to keep an eye on regarding the global economy last September. Since then share markets plunged into December and have since rebounded. The rebound has been great, but we have seen such rebounds before only to see weakness resume so on its own it does not prove we are out of the woods. It’s rare for US shares to have a deep V recovery after a 20% or so fall as seen last year. And with share markets having run hard from their December lows and technically overbought some sort of short-term pull back is a high risk. But will it be the resumption of the downturn in shares that began last year or just a pullback setting the scene for the next leg higher? Our view is that it will more likely be the latter. We don’t see an imminent US, global or Australian recession. And the swing now underway towards more dovish/stimulatory global economic policy along with declining trade war risks will likely drive stronger global economic growth in the second half of the year. As a result this year is expected to ultimately provide decent returns for shares.

Of course, no one really knows for sure so this note revisits the five charts we see as critical to which way it will ultimately go and adds a table on US recession risks to monitor.

Chart 1 – Global business conditions PMIs

Global Purchasing Managers Indexes (PMIs) – surveys of purchasing managers at businesses in most major countries – are an excellent and timely guide to the state of the global economy. These remain high but they have been falling over the last year indicating slowing growth (as occurred into 2012 and 2016). There are some signs of stabilisation in the US, but they will need to improve more broadly to be consistent with our view that growth will pick up in the second half of the year. At least they are a long way from recessionary readings.


Source: Bloomberg, AMP Capital

Chart 2 – Global inflation

Major economic downturns are invariably preceded by a rise in inflation to above central bank targets causing central banks to slam the brakes on. At present, core inflation in major global economies is benign. In the US core inflation is just below the Fed’s 2% inflation target, which along with headwinds to growth has enabled the Fed to pause its interest rate hikes. Inflation in China has been falling and is well below the Government’s 3% target/forecast. And inflation in the Eurozone and Japan, is well below target and provides no constraint to ongoing policy stimulus with the ECB likely to soon announce another round of cheap funding for banks. A clear upswing in core inflation would be a warning sign of aggressive monetary tightening being on the way, but this keeps getting delayed by events like last year’s global growth slowdown and oil price collapse.


Source: Bloomberg, AMP Capital

Chart 3 – The US yield curve

The yield curve is a guide to the stance of monetary policy. When short-term interest rates are low relative to long-term rates businesses can borrow short and lend (or invest) long and this grows the economy. But it’s not so good when short rates are above long rates. An inverted US yield curve has preceded US recessions. So, when it’s heading in this direction some worry. And it has been lately, with both the gap between the 10-year bond yield and the Fed Funds rate and the gap between the 2- year bond yield and the Fed Funds rate flattening lately.


Source: NBER, Bloomberg, AMP Capital

But there are several things to allow for. First, the yield curve can give false signals (circled on the chart) and the lags from an inverted curve to a recession can be around 15 months. So even if it inverted now recession may not arrive till mid next year and historically the share market has peaked 3-6 months before recessions, so it would be too far away for markets to anticipate.

Second, various factors may be flattening the yield curve which are unrelated to economic growth including near zero German and Japanese bond yields holding down US yields and high investor demand for bonds post the GFC as they have proven to be a good diversifier – rallying every time shares have a major fall.

Third, other indicators suggest that US monetary policy is far from tight – the real Fed Fund rate is barely positive, and the nominal Fed Funds rate is well below nominal GDP growth and both are far from levels that in the past have preceded US recessions.

So the yield curve is worth keeping an eye on – particularly now it’s flashing amber – but its short comings need to be allowed for.

Chart 4 – The US dollar

Unlike moves in most individual currencies, which are only of relevance to the country they belong to, moves in the $US are of broad global significance. This is because of its reserve currency status and that a lot of global debt is denominated in US dollars particularly in emerging countries. So when the $US goes up like in 2015 and last year it makes it tough for emerging countries. It also depresses US company profits with a lag.


Source: Bloomberg, AMP Capital

A continuing upswing would cause further damage for emerging markets and so pose a threat to global growth (as the emerging world is around 60% of global GDP). Since late last year the $US has come of its recent highs though – if it remains more benign as we expect it will help emerging market shares and US profits.

Chart 5 – World trade growth

Growth in world trade may be expected to slow over time as services become an ever-greater share of economic activity and manufacturing becomes less labour dependent. But last year it was under threat from slowing global growth and the protectionist threat from President Trump in the US. This saw trade volume growth stall and trade war talk dent business confidence. So far US average import tariffs have been increased by less than 2% so it’s early days. But more has been threatened. Fortunately, the trade war is in a truce at present with positive signs regarding US/ China talks and slowing growth (and Trump’s desire to get re-elected next year) providing an incentive to reach a deal which we expect. But if the truce and trade talks with China, the EU and Japan fail and it’s back to escalating tariffs threatening a decline in world trade then it would be a bad sign.


Source: CPB World Trade Volume Index, Thomson Reuters, AMP Capital

US recession still a way away

The historical experience tells us that what happens in the US is critical to how deep share market falls get. Deep (“grizzly”) bear markets like the 50% plus fall seen in the GFC are invariably associated with US recession. So, whether a recession is imminent in the US, and more broadly globally, is critically important in terms of whether a major bear market commenced last year or is on the way. The next table summarises the key indicators we are watching in this regard.

US recession signposts


Source: AMP Capital

These indicators are not foreshadowing an imminent recession in the US. The yield curve is most at risk (hence the question mark) but even it is not there yet. Meanwhile, other measures of monetary policy in the US are not tight and we have not seen the sort of excesses that normally precede recessions – there has been no overinvestment in capital goods or housing, private debt growth has not been excessive, the US leading indicator is far from recessionary levels and inflation is benign. Maybe it could happen from mid-next year or it could be driven by an external shock like an intensified trade war but at this stage its not imminent, so our view remains that last year’s share market falls are unlikely to be the start of a deep bear market.

Concluding comments

On balance these indicators still suggest the outlook remains okay. But to be consistent with our view that this year will see decent returns from shares we need (and expect) to see global growth indicators such as PMIs stabilise and head higher in the months ahead, inflation to remain benign, the $US to be relatively constrained and the trade threat continue to recede.

 

Source: AMP Capital 21 Feb 2019

Important notes

While every care has been taken in the preparation of this article, AMP Capital Investors Limited (ABN 59 001 777 591, AFSL 232497) and AMP Capital Funds Management Limited (ABN 15 159 557 721, AFSL 426455) makes no representations or warranties as to the accuracy or completeness of any statement in it including, without limitation, any forecasts. Past performance is not a reliable indicator of future performance. This article has been prepared for the purpose of providing general information, without taking account of any particular investor’s objectives, financial situation or needs. An investor should, before making any investment decisions, consider the appropriateness of the information in this article, and seek professional advice, having regard to the investor’s objectives, financial situation and needs. This article is solely for the use of the party to whom it is provided.

Five great charts on investing – why they are particularly important now

Date: Feb 14th, 2019

Investing seems to be getting more and more complex. Ever increasing complexity in terms of investment products and choices, regulations and rules around investing, the role of social media in amplifying the noise around investment markets and the increasing ways available to access various investments are all adding to this complexity. However, at its core, the basic principles of successful investing are simple. And one way to demonstrate that is in charts or pictures. This note revisits five charts I find useful in understanding investing. They are particularly pertinent in volatile and seemingly uncertain times like the present, so they are worth a revisit.

Chart #1 The power of compound interest

My love of this chart came out of my good friend and well-known economist, Dr Don Stammer, regularly espousing the importance of the magic of compound interest. And it is like magic – but many miss out because they are too busy looking for disasters around the corner or assuming that once disaster hits it will be with us indefinitely! What it shows is the value of $1 invested in various Australian assets in 1900 allowing for the reinvestment of dividends and interest along the way.


Source: Global Financial Data, AMP Capital

That $1 would have grown to $238 if invested in cash, to $906 if invested in bonds and to $532,739 if invested in shares. While the average return since 1900 is only double that in shares relative to bonds, the huge difference between the two at the end owes to the impact of compounding or earning returns on top of returns. So any interest or return earned in one period is added to the original investment so that it all earns a return in the next period. And so on. I only have Australian residential property data back to 1926 but out of interest it shows (on average!) similar long term compounded returns to shares.

Blowed if I know where it came from, but the “Law of 72” is useful way to understand how long it takes an investment to double in value using compounding. Just divide 72 by the rate of return and that’s the answer (roughly). For example, if the rate of return is 2% per annum (eg, the interest rate on a bank term deposit), it will take 36 years to double in value (= 72 divided by 2). But if it’s, say, 8% pa (eg, what shares may be expected to return over the medium-term including dividends), then it will take just 9 years (= 72 divided by 8).

Key message: to grow our wealth, we must have broad exposure to growth assets like shares and property. This is far more important than second order issues like which particular stocks to have in your share portfolio. While shares have been volatile lately and the short-term outlook for Australian housing is messy, both will likely do well over the long term.

Chart #2 The investment cycle lives on

The trouble is that shares can have lots of setbacks along the way as is particularly evident during the periods highlighted by the arrows on the share market line. The higher returns shares produce over time relative to cash and bonds is compensation for the periodic setbacks that they have. But understanding those periodic setbacks – that there will always be a cycle – is important in being able to not miss out on the higher returns that shares and other growth assets provide over time. The next chart shows a stylised version of the investment cycle.

The investment cycle


Source: AMP Capital

The grey line shows the economic cycle from “boom” to “bust” to “boom” again. Just before the low point in the economic cycle, shares invariably find a bottom and start to move higher thanks to attractive valuations and easy monetary policy and as smart investors anticipate an eventual economic recovery. This phase usually sees scepticism and disbelief as economic conditions are still weak. Shares are eventually supported by stronger earnings as economic conditions improve, which eventually gives way to a blow off phase or euphoria as investors pile in. This ultimately comes to an end as rising inflation flowing from strong economic growth results in ever tighter monetary policy, which combines with smart investors anticipating an economic downturn and results in shares falling. Often around the top of the cycle real assets – like property and infrastructure – are a better bet than shares as they benefit from strong real economic conditions. But that’s not always the case. Once the downturn starts, bonds are the place to be as slowing growth gives way to falling inflation which sees bond yields fall producing capital gains for investors. At some point, of course, easing monetary conditions and attractive valuations see shares bottom out and the whole cycle repeats.

Key message: cycles are a fact of life and it’s usually the case that the share market leads the economic cycle (bottoming before economic recovery is clear and topping before economic downturn hits) and that different assets do best at different phases in the cycle. Of course, each cycle is a bit different. Some are short but some, like the big bull market in US shares since 2009, are long because the recovery is slow and so it takes longer to build up excesses that end the cycle.

Chart #3 The roller coaster of investor emotion

Its well known that the swings in investment markets are more than can be justified by moves in investment fundamentals alone – like profits, dividends, rents and interest rates. This is because investor emotion plays a huge part. The next chart shows the roller coaster that investor emotion traces through the course of an investment cycle. A bull market runs through optimism, excitement, thrill and ultimately euphoria by which point the asset class is over loved and overvalued and everyone who is going to buy has – and it becomes vulnerable to bad news. This is the point of maximum risk. Once the cycle turns down in a bear market, euphoria gives way to anxiety, denial, capitulation and ultimately depression at which point the asset class is under loved and undervalued and everyone who is going to sell has – and it becomes vulnerable to good (or less bad) news. This is the point of maximum opportunity. Once the cycle turns up again, depression gives way to hope and optimism before eventually seeing euphoria again.

The roller coaster of investor emotion


Source: Russell Investments, AMP Capital

Key message: investor emotion plays a huge role in exaggerating the investment cycle. The key for investors is not to get sucked into this emotional roller coaster: avoid assets where the crowd is euphoric and convinced it’s a sure thing and favour assets where the crowd is depressed and the asset is under loved. Of course, doing this is easier said than done which is why many, if not most, investors end up getting wrong footed by the investment cycle. Getting sucked in during the good times only to panic out during the bad times.

Chart #4 The wall of worry

There is always something for investors to worry about. The worries ramped up last year with concern around inflation, the Fed, rising bond yields, trade wars, US politics and President Trump generally, Italy, the ongoing Brexit soap opera, Chinese debt and slowing growth, the surging and then plunging oil price and in Australia with the Royal Commission and falling home prices. And in a world where social media is competing intensely with old media and itself for attention on the nearest screen right in front of you it all seems more magnified and worrying than ever. But of course most of this stuff is just noise. The global economy has had plenty of worries over the last century, but it got over them with Australian shares returning 11.7% per annum since 1900, with a broad rising trend in the All Ords price index as can be seen in the next chart, and US shares returning 9.8% pa. (Note that this chart shows the All Ords share price index whereas the first chart shows the value of $1 invested in the All Ords accumulation index, which allows for changes in share prices and dividends.)


Source: ASX, AMP Capital

Key message: worries are normal around the economy and investment markets but most of them are just noise. It all seems louder and more worrying now because it’s getting magnified by social media screaming for attention. Try to turn it down.

Chart #5 Time is on your side

In the short term, investment markets bounce all over the place. Even annual returns in the share market are highly volatile, but longer-term returns tend to be solid and relatively smooth as can be seen in the next chart. Since 1900, for Australian shares roughly two years out of ten have had negative returns but there are no negative returns over rolling 20-year periods. (It’s roughly three years out of ten for US shares since 1900.)


Source: Global Financial Data, AMP Capital

Key message: the longer the time horizon, the greater the chance your investments will meet their goals. So in investing, time is on your side and its best to invest for the long term.

 

Source: AMP Capital 13 Feb 2019

Important notes: While every care has been taken in the preparation of this article, AMP Capital Investors Limited (ABN 59 001 777 591, AFSL 232497) and AMP Capital Funds Management Limited (ABN 15 159 557 721, AFSL 426455) makes no representations or warranties as to the accuracy or completeness of any statement in it including, without limitation, any forecasts. Past performance is not a reliable indicator of future performance. This article has been prepared for the purpose of providing general information, without taking account of any particular investor’s objectives, financial situation or needs. An investor should, before making any investment decisions, consider the appropriateness of the information in this article, and seek professional advice, having regard to the investor’s objectives, financial situation and needs. This article is solely for the use of the party to whom it is provided.

When super isn’t compulsory

Date: Feb 13th, 2019

As Australia’s $2.8-trillion super system attracts even more headlines than usual, more people may mistakenly assume that almost everyone in the workforce is covered by at least compulsory contributions.

In reality, the position is far different.

A research paper* from the Association of Superannuation Funds of Australia (ASFA) reminds us that a “substantial proportion” of Australia’s workforce is self-employed and therefore does not receive superannuation guarantee (SG) contributions.  

In other words, they are out in the super cold – unless they are among the small minority of the self-employed who make voluntary contributions or who have built-up some super savings from past employment.

Based on Australian Bureau of Statistics data, ASFA’s paper points out that 1.267 million people or about 10 per cent of our total workforce, as at August 2017, were owner-managers of unincorporated small businesses as their main occupation.

And the percentage of the workforce that is self-employed and uncovered by compulsory super contributions is expected to rise with the seemingly-relentless growth of the gig economy.

Here’s another key statistic. Some 20 per cent of the self-employed have no super whatsoever compared to 8 per cent of employees.

Critically, any super held by the self-employed is often extremely small, arising from whenever they have been classified as employees and eligible for compulsory contributions. Often, their modest super savings arise from the time they first joined the workforce and from occasional employment.

It seems paradoxical that the self-employed are among the most enthusiastic supporters of self-managed super when the majority of the self-employed have little or no super.

What can a self-employed person take to make that they don’t miss out on super? Here are a few tips:   

  • Try to make regular contributions as if employed: Think about making contributions that are at least the equivalent of the compulsory contributions you would have received if employed. (The superannuation guarantee rate is currently 9.5 per cent of an employee’s ordinary earnings up to a maximum salary amount.)

  • Claim a tax deduction for concessional contributions: The self-employed can claim tax deductions for their concessional (before-tax) contributions. The annual concessional cap for all eligible super fund members is $25,000. (Concessional contributions comprise compulsory contributions, salary-sacrificed contributions and personally-deductible contributions by eligible self-employed individuals and investors.)

  • Contribute early, contribute often and contribute as much as you can afford:  By following this disciplined approach, you will reduce the chances of being left behind employees with your super savings.

  • Look for opportunities to contribute more: If you receive, say, an inheritance or sell a non-super investment, consider contributing some of the money to super within the contribution caps. (The standard non-concessional, after-tax, contributions cap is $100,000 for 2018-19. Fund members under 65 have the option of contributing up to $300,000 in non-concessional contributions over three years, depending upon their total super balance.)  

  • Think carefully before cutting your contributions if cash is tight: A temptation for the self-employed is to cut super contributions if business cash-flow becomes tight. Consider the long-term implications for your retirement savings of reducing your contributions; there may be other ways for your business to save money.

  • Don’t overlook the insurance side of super: Most Australians with life and permanent disability insurance obtain at least default cover through their large super funds. And many of the self-employed also choose to hold income-protection insurance through their funds.

  • Aim to obtain asset protection with super: Self-employed business owners sometimes seek advice about how their super savings may be protected in the unfortunate event of a future bankruptcy – subject to claw-back provisions in bankruptcy law.

  • Watch for a gig-economy super trap: Understand that employers are not obliged to make super guarantee contributions for employees earning less than $450 a month before tax. This means, for instance, that employees making up their incomes doing a number of part-time jobs for different employers may fall below the threshold for each.

  • Guide young family members towards super: If you have young family members working in the gig economy, perhaps in a series of part-time jobs, consider talking to them about the benefits of making voluntary super contributions.

Most of us have probably heard a self-employed business owner say “my business is my super” or similar words. Their expectation is often to eventually sell their businesses to raise enough capital to finance their retirement. But how realistic are those expectations?

As a past ASFA research paper points out that while some of these businesses may have a value of “a million dollars or more”, others may be worth may worth “little more than the market value of a second-hand utility or truck and some tools of trade”.

*Superannuation balances of the self-employed by Andrew Craston, Association of Superannuation Funds of Australia, 2018.

 Source : Vanguard February 2019 

By Robin Bowerman, Head of Corporate Affairs at Vanguard.

Reproduced with permission of Vanguard Investments Australia Ltd

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Why growth in China is unlikely to slow too far and why it needs to save less and spend more

Date: Feb 07th, 2019

Scepticism about China’s economic success amongst (mostly western) investment commentators has been an issue for as long as I can remember. The current China worries mainly relate to slowing growth, high debt and the trade dispute with the US. China is now the world’s second largest economy and its biggest contributor to growth so what happens in China has big ramifications globally. This is particularly so in Australia as China is its biggest export destination. This note looks at the main issues and what it means for investors and Australia.

Is growth slowing a little or a lot?

China slowed through 2018. GDP growth for the whole of 2018 came in at 6.6% which was a bit above our expectation of 6.5%, but it was down from 6.8% growth in 2017 and momentum slowed to 6.4% year on year in the December quarter. Some commentators argue that China’s actual GDP growth is much weaker – maybe just half the reported rate. The argument often runs along the lines that the GDP data comes out too early after the end of each quarter, it’s too smooth to be believed and that it’s made up to suit the annual growth target. This speculation has long been around and I’ve always thought it’s a bit of a distraction: it stands to reason that emerging countries like China have less to spend on stats so they may be less accurate than in rich countries, and if China’s economy is really a lot smaller than it claims then why is the rest of the world so concerned about a slowdown in its economy? And why is the US concerned about its rising economic clout? The bottom line is that it’s all too academic to get too hung up on and so I tend to see the GDP data as a rough, but admittedly imperfect, guide.

So what does other data say? As can be seen in the next chart, growth in industrial production, retail sales and fixed asset investment all slowed through 2018 to multi-year lows, albeit it’s all still pretty solid compared to most other countries. 


Source: Thomson Reuters, AMP Capital

Annual growth in exports and imports also went negative in December and the weakness in exports could have further to go given that they were arguably artificially boosted as Chinese exporters/US importers sought to “front run” US tariffs.


Source: Bloomberg, AMP Capital

Chinese manufacturing conditions PMIs have also fallen sharply. See the next chart.


Source: Bloomberg, AMP Capital

For those sceptical of official Chinese data, I have shown the private sector Caixin survey but it’s a similar message from the official PMI survey, ie manufacturing has slowed.

While concerns about the trade war may have contributed to the slowdown, the main driver so far appears to be tighter credit conditions aimed at slowing debt growth via the less regulated “shadow banking” system. This would explain why smaller businesses are doing it tough relative to larger businesses.

However, it’s not all doom and gloom. First, the housing sector has been doing well with house prices rising.


Source: Bloomberg, AMP Capital

Second, while manufacturing has slowed, services has continued to hold up well. This is evident in relatively solid readings for the services conditions PMIs (in both the official and Caixin PMIs) of around 54 in contrast to weaker manufacturing PMIs – see the second chart above. Services are less affected by trade wars and the services sector is expanding relative to the manufacturing sector. Out of interest this may partly explain why GDP growth in China is now smoother and does better than expected with most commentators focusing on the old manufacturing sector.

Finally, policy stimulus is ramping up…

Policy easing

In response to the growth slowdown, China has moved to start providing significant policy stimulus with the People’s Bank of China cutting the required reserves that banks have to keep (allowing them to lend out more) and the government recently announcing fiscal stimulus focused on tax cuts for households and small businesses but also infrastructure spending amounting in total to 2-3% of GDP for this year. With public debt and inflation relatively low there is little constraint on policy stimulus except to avoid another big ramp up in debt, which is why stimulus is now more focused on tax cuts than debt-related investment. Which in turn means more of a boost to services demand in China than to global commodity demand and a less certain impact than was seen from the 2008 and 2015-16 stimulus programs.

Growth and inflation outlook

We expect Chinese growth this year to slow further in the short term particularly as exports weaken after front running, but policy stimulus should help head off a deeper downturn and see growth improve in the second half. But it’s more aimed at preventing a sharp downturn in growth rather than pushing growth a lot higher. So overall growth is expected to be around 6.2% this year which is still a bit slower than last year’s 6.6% growth rate. Inflation is likely to remain low.

What about China’s “debt time bomb”?

This is the most commonly expressed concern about China, with the ratio of non-financial debt to GDP having increased very rapidly from around 150% a decade ago to nearly 300% now. This has caused some to fear a financial catastrophe for China. However, China’s debt problems are different to most countries. First, China has borrowed from itself – so there’s no foreigners to cause a foreign exchange crisis. Second, much of the rise in debt owes to corporate debt that’s partly connected to fiscal policy and so the odds of a government bailout if things go wrong are high. Finally, the key driver of the rise in debt in China is that it saves around 45% of GDP (roughly double that in developed countries) and most of this is recycled through the banks where it’s called debt. So unlike other countries with debt problems, China needs to save less and consume more, and it needs to transform more of its saving into equity rather than debt. Chinese authorities are aware of the issue and overall growth in debt has slowed but slamming on the debt brakes without seeing stronger consumption makes no sense. But boosting consumption will take time and will involve moving to a more progressive tax system and enhanced social welfare.

What about the trade war?

While the tariff increases that have actually been implemented so far in the US/China trade war are relatively small the threat of more to come has clearly adversely affected confidence (and thus investment) in both countries. Trade negotiations between the US and China are reportedly progressing well but big differences apparently still remain. The pressure from slowing growth on both sides means that both China and the US are under pressure to reach a deal though – notably President Trump who doesn’t want to see recession or an extended bear market derail his 2020 re-election prospects. As such we see roughly an 80% chance that a deal is reached – either before the March 1 deadline for negotiations or after an extension.

The Chinese share market

Chinese shares have bounced 9% from their December low. But they had a 32% top to bottom fall last year and are still cheap trading on a price to forward earnings ratio of just 10 times (compared to 14.7 times for Australian shares) which is about as cheap as they ever get. See the next chart.


Source: Thomson Reuters, AMP Capital

They may have a short-term pullback as growth slows further in the first half, but with valuations cheap they should perform well on a 12-month horizon as growth and hence profits improve through the second half.

Implications for Australia

A sharp slowdown in China would be a double whammy for the Australian economy coming at the same time as the housing downturn. But while it’s a risk it’s not our base case. Rather our outlook for China’s economy to stabilise and growth to pick up a bit in the second half implies a reasonable – but not spectacular – outlook for commodity prices. Combined with the spike in iron ore prices on the back of Vale’s problems (albeit temporary) it points to reasonable growth in export earnings, which will be one source of support helping to counter the housing downturn. Reasonable commodity prices will help prevent a sharp drop in the $A, but we still see it falling into the $US0.60s as the RBA cuts the cash rate to 1% this year.

 

Source: AMP Capital 7 Feb 2019

Important notes: While every care has been taken in the preparation of this article, AMP Capital Investors Limited (ABN 59 001 777 591, AFSL 232497) and AMP Capital Funds Management Limited (ABN 15 159 557 721, AFSL 426455) makes no representations or warranties as to the accuracy or completeness of any statement in it including, without limitation, any forecasts. Past performance is not a reliable indicator of future performance. This article has been prepared for the purpose of providing general information, without taking account of any particular investor’s objectives, financial situation or needs. An investor should, before making any investment decisions, consider the appropriateness of the information in this article, and seek professional advice, having regard to the investor’s objectives, financial situation and needs. This article is solely for the use of the party to whom it is provided.

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