top of page
  • Writer's pictureRobert Baharian

The Financial Market's Handbook

I've been writing lately about the volatility in financial markets. In this week's release of our Financial Markets Handbook, the narrative is not dissimilar.

The March 2024 quarter was a cracker - if you were invested, that is. Bitcoin led the charge, up about 59% for the quarter. I sold my Bitcoin around the peak in March. I don’t say this to purport any foresight. In fact, readers will recall I purchased my Bitcoin during the March 2021 peak - my wife was not too happy about this. Three years later, I had the last laugh, up 50% on my investment - boom. My wife normally doesn’t read my writing, however she will certainly be drawn to read this one for some reason.

International shares continue their outperformance relative to domestic shares, up 13.3% in AUD terms for the quarter - almost 3x of that of the ASX. Most of this performance was driven by momentum, quality, and growth stocks.

Here are 18 quick observations from the quarter:

  1. If you weren’t invested during the March quarter, you just left a ton of money on the table. See Page 5.

  2. After tax, cash still hasn’t kept up with inflation. Cash is not long-term investment.

  3. History tells us that you can expect anywhere between 6%-13% pa over the next 10 years in US stocks. See Page 10.

  4. Just because this quarter was a cracker, it doesn’t tell us anything about the future. On average we can expect the market to fall about 14% intra-year and still have the market end the year strongly. See Page 11.

  5. Just when you thought bonds had dusted themselves off and got back on their feet, they just got punched in the face again. See Page 13 and 16.

  6. Notwithstanding Point 5, I still think there is merit in allocating to bonds. We’re never going to get the timing right. See Page 14.

  7. If you were waiting for that stock market drop, the S&P 500 just made new all time highs. See Page 15.

  8. Why would stocks fall when corporate earnings continue to grow? See Page 18.

  9. Corporate margins continue to remain strong. See Page 19.

  10. The stock market is up more than it is down. See Page 20.

  11. Inflation is coming down in the same fashion as it went up. It didn’t go up in a straight line, so why would it come down in a straight line? See Page 21. More specifically, see Australian inflation on Page 22.

  12. National property prices appear to have peaked. We may see growth really slowing. See Page 27.

  13. Melbourne and Sydney have peaked in terms of price growth and are already turning with Brisbane looking to follow suit. Perth and Adelaide are still on the rise. See Page 28.

  14. Housing equity continues to provide a huge buffer to debt. See Page 29.

  15. Although unemployment remains strong and historically low, it is starting to tick up. See Page 31.

  16. Households continue to spend, depleting savings and keeping inflation warm. See Page 33. Inflation is shifting from goods inflation to services inflation.

  17. The COVID-19 recovery continues to follow that of the GFC. We could see this market continue to rise steadily. See Page 34.

  18. See Page 25 on why I think we could be in for a longer-term boom similar to that of the Roaring 20’s.

We have updated our Financial Market's Handbook for 1Q 2024 and examine the impact the last quarter has had on key financial indicators that relate to financial markets. You can download the report here. You are welcome to share it across your network.


bottom of page