Spelade
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It’s been a crazy year for virtually every asset class. Commodities have been particularly interesting, though, because earlier this year, when most everything was selling off, commodities went on a bull run!
It’s a highly volatile sector, exposed to just about every macroeconomic variable there is, so investing in it takes a unique skill set. But as you'll learn, it's a first-order beneficiary of the big trends that will define markets over the coming decades. And that means massive returns.
In today's episode of The Rules of Investing, Livewire's David Thornton is joined by Luke Smith from Ausbil Investment Management. Luke runs Ausbil’s Global Resources Fund. The fund invests in natural resources companies using a top down and bottom up approach. It also goes short to help manage risk.
Luke explains why he's so bullish on battery metals, how the decarbonisation supercycle will pull commodities along for the ride, the mismatch between the nearish micro narrative surrounding China and what he's seeing at the micro level, and how he finds companies with relative value.
Note: this episode was recorded on Thursday November 11, 2022.
Timestamps1:20 - Ausbil Global Resources Fund
4:10 - High demand, low supply in battery metals
9:30 - Falling demand in the West, accelerating demand in the East
10:15 - Macro fears distracting from micro strength
11:50 - Positioning through the commodities bull market
12:40 - Lacking investment in new supply
13:30 - Lithium spodumene price goes 25x
16:00 - Lithium, Cobalt and Copper are key for electrification
18:30 - Energy was on a tear before Russia-Ukraine
19:00 - Don't write off fossil fuels
20:50 - Separating signals from noise
24:00 - Don't be negative in a negative market
30:00 - Don't equate Aussie EV penetration with demand for electrification
32:00 - As relative value shifts, so should your exposures
37:00 - Commodities fundamentals are stronger than the macro narrative
41:08 - Betting against the market in 2020
43:10 - A Decarb stock for the bottom drawer
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Welcome to Season Two of Gone South, the Edward R. Murrow Award winning documentary podcast from C13Originals.
Starting in the early sixties, a rag-tag confederation of traveling criminals known as The Dixie Mafia terrorized every state from Georgia to Oklahoma. Its hundreds of members, unofficially headquartered in Biloxi, Mississippi, specialized in scams, heists and murder. Their ringleader, the estranged son of a prominent Oklahoma politician, was a skilled and charismatic outlaw named Kirksey Nix. When Nix was sentenced to life in prison at Angola for a murder he committed in New Orleans, The Dixie Mafia was thought to be extinct. But fifteen years later, a sitting criminal court judge named Vincent Sherry and his wife Margaret, a mayoral candidate for the city of Biloxi, were assassinated. As the case ran cold, authorities were forced to confront a disturbing reality: the reign of Kirksey Nix and The Dixie Mafia was far from over.
Gone South is a creation and production of Peabody-nominated C13Originals, a Cadence13 studio, in association with Jed and Tom Lipinski.
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1984 follows the life of Winston Smith, a low ranking member of ‘the Party’, who is frustrated by the omnipresent eyes of the party, and its ominous ruler, Big Brother. Orwell effectively explores the themes of mass media control, government surveillance, how a dictator can manipulate and control history, thoughts, and lives in such a way that no one can escape it.
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