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Hedge Clippings | 24 April 2025 The Election (yawn!) Amid one of the least inspiring election campaigns from either side of politics, along with a more negative and combative approach from both the candidates and some of their supporters, the polls are pointing to what seemed an unlikely outcome: An Albanese victory just 12 to 18 months since his divisive Voice referendum. Albo's been helped by what appears to be an irresponsible showering of benefits not only to key demographics (e.g. Students with HECS debts, and first home buyers), but also to all and sundry in the form of electricity rebates. It seems that most voters couldn't care less about the government deficit we'll all have to pay for eventually, as long as individually they don't have to pay for it now. As Paul Keating once reminded us, "in the race of life, always back self-interest, at least you know it's trying". The televised debates have been indecisive at best, and worse still, boring and petty, with plenty of lies thrown in. Don't let the truth get in the way of a good story, and sling the mud, knowing some will stick. But the person who seems to be helping Albo back to the Lodge more than anyone seems to be none other than Peter Dutton, with on-again, off-again and delayed policy announcements, leaving him open to claims that he's either hiding something, or hasn't decided yet. He's had three years to prepare, but was perhaps waiting for Albo to trip up - or just fall off the stage. Figures released this week by the ABS indicated that maybe Albo and Chalmers do know where the handouts are coming from. Total tax revenue for the 2023-2024 financial year was $801.7 billion, an increase of 6.1% over 2022-23. Over the same period, CPI inflation rose 3.8%. To be fair, the Commonwealth's take was "only" up 5.1%, with the states the major culprits - Victoria (not surprisingly) leading the charge, +14.2%, followed by NSW, +11.8%, and South Australia +11.3%. At least you know one source of the cost of living crisis - governments of all persuasions were taking more of your hard-earned, with Victoria's increase almost 4 times the rate of inflation. Remember this on the eve of ANZAC Day: Federal income tax was first introduced in 1915 as a temporary measure to help fund the war effort in the First World War. If you think that's a worry, wait until the government broadens the net on taxing unrealised capital gains, surely one of the more ridiculous proposals, even for this government. Fund Returns: March has recorded one of the more extreme spreads of fund returns (60%) that we have seen since the GFC, with monthly returns ranging from +25.97 % through to -35.09%. This has led to the perennial debate between active vs. passive investing, with proponents of the latter (generally the index funds themselves) highlighting negative returns from their active peers over relatively short time frames. For the record, the March, Year to date (January - March, basically "Trump months") and 12-month averages are as follows: Assuming index or passive funds generally track their respective index, and the above numbers are averages across a total of 900 funds, the key takeaways are as follows:
For example, the top performing Australian Equity fund (Regal's Australian Small Companies Fund) has returned 20.18% since its inception in February 2015. Over 7 years, it has returned 14.99% per annum, and 25.79% over 5 years. In March 2025 it was down 14.53%. That level of volatility does not suit all investors, but there are plenty of funds providing 8-12% returns or more outside the volatile equity space. Research is the key! Finally, on ANZAC Day eve, we'd like to remember those no longer with us, those left behind, and those who continue to serve. Lest we forget. News & Insights Quarterly State of Trend report - Q1 2025 | East Coast Capital Management Are we there yet?! | 4D Infrastructure March 2025 Performance News Bennelong Australian Equities Fund Bennelong Concentrated Australian Equities Fund |
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