Doug Goodwille from Kayne Anderson speaks to Drew Meredith from The Inside Network on market thinkers.
While a surging gold price is on hold as the world adjusts to a Trump presidency, all the factors that saw its price rise more than 50 per during his first term in office – trade disputes, fiscal deficits and geopolitical tensions – are almost certainly guaranteed the second time around.
Commodities to win 2021, banks under pressure
This week we caught up with fast-growing equity and private credit manager, Datt Capital, to understand what drives Emmanuel Datt and what he looks for in a portfolio holding.
What is the most powerful career advice you have received?
Always invest in yourself – learning new skills, even outside your vocation, will always be of future net benefit.
What has been the most important lesson from 2020?
Examine the facts dispassionately and then seize the opportunity. It was easy to continue to be bearish in early March after a 35% fall in the market. We increased our exposure at this time which led to an excellent outcome for our investors.
What are you positive about in the year ahead?
Proactive common sense returning to society and markets, rather than the reactive hysteria we’ve experienced of late.
What is your biggest red flag when assessing a company?
Detrimental related-party transactions or agreements.
What does the best company for your portfolio look like?
High-growth, high-quality assets or best-in-class product design; misunderstood by market, with asymmetric return potential.
What changes have you been making to your portfolio in recent months?
Cutting lower-quality, non-core exposures.
What stocks have you added?
Deterra Royalties (ASX:DRR)
Why those stocks?
Deterra fulfils our core growth requirements and holds the world’s highest-quality listed mineral royalty
What sectors are you most overweight?
Minerals, and financial services.
What sectors are you most underweight?
Banks and energy.
What sectors or themes do you believe will drive returns over the next 12 months?
Commodities – both hard and soft – have had supply-side challenges due to historical low prices. We expect the supply side to be in deficit for many commodities which may increase prices looking forward over a number of years.
Which sectors and companies are most challenged heading into 2021?
The banking sector will likely start to feel the impacts of the COVID-related lockdowns and tempering of government support going into 2021.
Which companies do you believe are most under-appreciated in 2020 and beyond?
Of late, we are finding fantastic opportunities in biotech; many with the potential to improve the quality of life for a huge number of people. But patience and significant skill are required to sort the wheat from the chaff.
