WEBVTT - Top stock picks for 2026 (with Jun Bei Liu) 0:00:08.360 --> 0:00:11.480 Hello and welcome to The Australian's Money Puzzle podcast. I'm 0:00:11.560 --> 0:00:15.280 James Kirby. Welcome aboard everybody now if you've just tuned in. 0:00:15.400 --> 0:00:18.880 We started the year earlier this week with the edition 0:00:19.320 --> 0:00:21.680 Your Shares in twenty twenty six, and we had Mark 0:00:21.760 --> 0:00:26.160 Jocum take us on a panoramic view really of global 0:00:26.200 --> 0:00:29.479 investment markets and what we might reasonably expect in the 0:00:29.560 --> 0:00:34.400 year ahead. Today we're going to look at individual shares. Specifically, 0:00:34.479 --> 0:00:36.560 we're going to look at Australian shares on the A six, 0:00:36.600 --> 0:00:40.239 which means we're talking about stock picking. And joining me 0:00:40.320 --> 0:00:45.280 on the show is jun Belu of Tedcap. If you 0:00:45.400 --> 0:00:48.479 recall she did this exercise with me last year. She 0:00:48.520 --> 0:00:51.280 had just started her fund actually this time last year, 0:00:51.800 --> 0:00:56.880 certainly as in its current formation, and in that twelve 0:00:56.880 --> 0:00:59.360 month period, I think we can say that she's become 0:00:59.360 --> 0:01:03.320 one of the best known, high profile certainly stock pickers 0:01:03.800 --> 0:01:07.800 in the market. Very good to have you on again. 0:01:07.840 --> 0:01:08.720 How are you, JB. 0:01:10.000 --> 0:01:12.320 I am great, Hi James, thank you so much for 0:01:12.440 --> 0:01:15.039 having you. Always love to have chat about the stock market. 0:01:15.440 --> 0:01:18.560 Well, we are ready to roll. As I say, we 0:01:18.640 --> 0:01:21.280 did an exercise earlier in the week where we just 0:01:21.319 --> 0:01:24.119 looked at the broader market and they sort of conditions 0:01:24.160 --> 0:01:27.000 out there, just to refresh for everybody. You know, our 0:01:27.080 --> 0:01:31.080 own market, the US did about seventeen eighteen percent, and 0:01:31.120 --> 0:01:34.400 we in the end almost got to ten percent, thankfully 0:01:34.920 --> 0:01:38.600 due to as always the dividend kicker of three and 0:01:38.640 --> 0:01:40.880 a half percent or so, which has come down it 0:01:40.959 --> 0:01:42.959 used to be about four and a half percent. We'll 0:01:42.959 --> 0:01:45.319 come back to that as the show goes on, but 0:01:45.480 --> 0:01:48.480 we want to look at first of all the outlook 0:01:48.520 --> 0:01:52.480 for the AX. Tough question, but clear question for you. 0:01:53.520 --> 0:01:56.600 Do you think the ASEX can do it again this year? 0:01:56.640 --> 0:01:59.080 Can it do double digits? 0:02:00.840 --> 0:02:03.000 Yeah, a SEX definitely is going to get to the 0:02:03.080 --> 0:02:06.120 double digit if anything, potentially a little bit of upside. 0:02:06.200 --> 0:02:08.760 I'll tell you why. There's a couple of tailwinds. One 0:02:08.840 --> 0:02:11.079 is that we started seeing our corporate earnings doing a 0:02:11.120 --> 0:02:13.160 little bit better. You know, in the last few years, 0:02:13.200 --> 0:02:15.760 we have had a lot of downgrades and now looking 0:02:16.000 --> 0:02:18.480 you know, looking forward next twelve months, we're looking at 0:02:18.480 --> 0:02:21.320 the corporate earnings growth between eight to twelve percent. That's 0:02:21.320 --> 0:02:24.000 actually pretty good. And then if you look at some 0:02:24.080 --> 0:02:26.520 of the biggest sector actually you know, one of the 0:02:26.520 --> 0:02:30.080 biggest sector, which is mining for Australia, they are having 0:02:30.280 --> 0:02:32.960 they are on fire. That sector is projected to do 0:02:33.040 --> 0:02:36.079 pretty well again this year, of course, will be more selective, 0:02:36.120 --> 0:02:39.040 will be more supported by some of the structural commodity 0:02:39.160 --> 0:02:42.120 like copper and others, but that sector should do pretty well. 0:02:42.280 --> 0:02:45.799 They paid pretty big dividends and that should drive quite 0:02:45.840 --> 0:02:47.920 a lot of growth in terms of earnings as well. 0:02:48.120 --> 0:02:50.200 So our market, I think it will get to the 0:02:50.240 --> 0:02:53.040 ten percent potentially with a little bit more, you know. 0:02:53.120 --> 0:02:56.320 I guess there's a bit of expectation for US market 0:02:56.360 --> 0:02:58.760 to do so much better, as people always do. I 0:02:58.800 --> 0:03:01.440 think the one thing that sort of held holding us 0:03:01.480 --> 0:03:03.639 back is that, you know, the back of the mind 0:03:03.720 --> 0:03:06.040 question of what's going to happen to our interest rate. 0:03:06.320 --> 0:03:07.720 We're going to get a height towards the end of 0:03:07.760 --> 0:03:10.640 the year potentially. I don't think it's coming soon, but 0:03:10.720 --> 0:03:13.079 I do think potentially there is a chance. But that 0:03:13.200 --> 0:03:15.520 is still going to see us see our market have 0:03:15.560 --> 0:03:16.440 a pretty good return. 0:03:17.120 --> 0:03:19.600 So just to give you some context there, it's not 0:03:19.680 --> 0:03:23.119 that we have strong earnings this year so much as 0:03:23.440 --> 0:03:25.919 we have earnings this year, right, So it's actually been 0:03:26.040 --> 0:03:29.119 pretty dull hasn't it in terms of earnings and perhaps 0:03:29.520 --> 0:03:34.079 behind all the noise, the inability to have strong earnings 0:03:34.080 --> 0:03:37.000 on the axis is really what explains why we were 0:03:37.040 --> 0:03:39.480 dragging our heads compared to the US in recent times. 0:03:41.080 --> 0:03:43.920 That's right, so recent US because the index is very 0:03:43.960 --> 0:03:46.520 dominated by a lot of those growth businesses and they 0:03:46.560 --> 0:03:49.440 have done incredibly well. And the challenge is that for 0:03:49.600 --> 0:03:51.600 next year is you know, there is a bit of 0:03:51.800 --> 0:03:55.160 investor skepism with evaluation, you know, and now they're getting 0:03:55.200 --> 0:03:58.560 returns and they are becoming cabinets heavy companies now. So 0:03:58.760 --> 0:04:01.920 now in a way that our market may see, Ernie Swarth, 0:04:01.960 --> 0:04:03.160 that's actually not too bad. 0:04:03.320 --> 0:04:05.760 One of the things that people have been concerned. There's 0:04:05.760 --> 0:04:10.680 two sort of outstanding, obvious, in your face headwinds for 0:04:10.880 --> 0:04:15.080 the AX all things been equal, who knows, of course 0:04:15.880 --> 0:04:18.120 the international markets and if we wake up in the 0:04:18.160 --> 0:04:21.279 morning and Wall Street has a ten percent correction, where 0:04:21.360 --> 0:04:24.800 we are going to follow that for sure absolutely probably 0:04:24.839 --> 0:04:28.159 exceeded history would suggest. So let's put that on the table. 0:04:28.320 --> 0:04:31.120 But as we stand, and as you say, twelve months 0:04:31.160 --> 0:04:33.640 is a long time, so we're talking over twelve month 0:04:33.680 --> 0:04:35.479 pero that we could do this double digit. But you 0:04:35.560 --> 0:04:38.040 mentioned one thing first of all already, which is the 0:04:38.040 --> 0:04:40.920 prospect of rising rates. So the consensus is that we're 0:04:40.920 --> 0:04:44.760 going to have rising rates now that is surely going 0:04:44.800 --> 0:04:48.360 to work against sentiment in the market. And the second 0:04:48.400 --> 0:04:50.719 thing that I just alluded to at the start is 0:04:51.240 --> 0:04:55.119 our great concushion has always been dividends. The dividend yields, 0:04:55.120 --> 0:04:57.640 which was about four and a half percent, it's actually 0:04:57.680 --> 0:04:59.839 sliding and sliding. It's now about three and a half. 0:05:00.400 --> 0:05:04.320 So how do you bake in those two factors? JB. 0:05:05.960 --> 0:05:08.159 That's a really good question. I think it's very true. 0:05:08.320 --> 0:05:10.600 First of all, with the interest rate, it's very interesting 0:05:10.640 --> 0:05:14.040 the expectations for rate rise has changed very rapidly, literally 0:05:14.080 --> 0:05:17.120 within the last few weeks of December, that market start 0:05:17.200 --> 0:05:20.800 expecting a rate rise in February, rate rise in May, 0:05:21.200 --> 0:05:24.599 and you know, instead of ray cards previously. So now 0:05:24.720 --> 0:05:27.159 my view is that because market is very fast in 0:05:27.440 --> 0:05:30.560 sort of pricing in the expectations, which you know, economic 0:05:30.640 --> 0:05:33.679 seems to have moved together. I do think that what's 0:05:33.720 --> 0:05:36.040 been priced in which we saw a lot of selling 0:05:36.080 --> 0:05:40.320 in the ur retailers, is now actually perhaps way too pessimistic. 0:05:40.480 --> 0:05:43.360 My view that we're not getting a rate rise in February. 0:05:43.600 --> 0:05:46.560 Even May is very skeptical because you know some of 0:05:46.600 --> 0:05:50.239 the data stats coming through. Normally for RBA, they called 0:05:50.320 --> 0:05:52.920 for the board. The key thing is to do nothing 0:05:53.080 --> 0:05:55.640 usually is the first step, and then it takes a 0:05:55.680 --> 0:05:59.640 really high hurdle to move from raate card to suddenly 0:05:59.760 --> 0:06:02.240 rate right. So that is going to be very negative. 0:06:02.279 --> 0:06:04.279 So for me is that I don't think it's coming 0:06:04.279 --> 0:06:06.600 in the first half of the year. Yes, you'll be negative, 0:06:06.720 --> 0:06:08.640 you know when it does come that part of the year, 0:06:08.640 --> 0:06:11.760 and that's assuming inflation stays very strong. We only just 0:06:11.800 --> 0:06:14.680 really have a one data point, you know, in September 0:06:14.760 --> 0:06:17.760 quarter that was that was stronger than expected. So you know, 0:06:17.800 --> 0:06:19.800 we're just still too early to call. Yes, c it 0:06:19.880 --> 0:06:22.400 is negative for the share market, but right now market 0:06:22.440 --> 0:06:25.160 is pricing in quite a lot of rate rise already, 0:06:25.240 --> 0:06:27.880 so from here on you know in a way that 0:06:27.920 --> 0:06:30.240 we won't be surprised. So I think it's been pricing 0:06:30.440 --> 0:06:33.160 at least one rise for this year, and I think 0:06:33.200 --> 0:06:36.000 if anything, timing could be extended out so that if anything, 0:06:36.040 --> 0:06:38.159 that's kind of on the positive front. So for the 0:06:38.200 --> 0:06:39.799 market valuation, before. 0:06:39.600 --> 0:06:42.480 You talk about dividend, Yeald, that's very interesting. So your 0:06:42.520 --> 0:06:44.599 theory to some extent is that the sell off in 0:06:44.640 --> 0:06:47.120 the role of the Christmas was actually because of the 0:06:47.160 --> 0:06:49.640 change of sentiment about rates and the market and the 0:06:49.680 --> 0:06:52.279 analysts and the journalists are all running wareheaded themselves in 0:06:52.360 --> 0:06:55.000 terms of how quickly this would and THERBA would never 0:06:55.080 --> 0:06:57.720 be seen to flip flop quite so dramatically. Is that 0:06:57.920 --> 0:06:59.440 basically what where you're coming from. 0:07:00.160 --> 0:07:03.120 Absolutely, I think the pricing is essentially being in and 0:07:03.240 --> 0:07:06.599 now we actually if you've seen some of the rediscretionary sector, 0:07:06.960 --> 0:07:08.800 they started performing a little bit better just in the 0:07:08.880 --> 0:07:11.520 last few weeks because the probability for raate rise is 0:07:11.560 --> 0:07:14.600 already moving back from you know, something like eighty percent 0:07:14.680 --> 0:07:17.400 in February now down to twenty five. So, you know, 0:07:17.560 --> 0:07:19.760 just the market's got too way ahead of themselves. 0:07:19.840 --> 0:07:23.400 So but consumer sentiment is it's pretty poor, Yeah, I 0:07:23.400 --> 0:07:23.680 think so. 0:07:23.880 --> 0:07:27.440 I think consumer the actual consumer sector for this year 0:07:27.480 --> 0:07:30.080 will be a bit challenged because we heard the Christmas 0:07:30.160 --> 0:07:33.120 was okay, you know, November was strong, but the challenges 0:07:33.200 --> 0:07:36.360 there's a lot of discounting and because of the headline 0:07:36.640 --> 0:07:39.400 was being discussed in the media. You know, Ray Rice rayhike. 0:07:39.680 --> 0:07:42.200 Consumer just don't spend. And on top of that, we 0:07:42.360 --> 0:07:46.160 also had the tragedy at Boondai shooting, you know, hearing 0:07:46.160 --> 0:07:48.680 your South Wales that has really caused a lot of 0:07:48.840 --> 0:07:51.920 traffic to disappear from shopping centers and others. You know, 0:07:52.040 --> 0:07:54.960 this has happened previously, any of those similar sort of 0:07:54.960 --> 0:07:57.960 events that you know, consumer just don't feel they want 0:07:58.000 --> 0:08:00.160 to be shopping, they want to don't Yeah, they don't 0:08:00.160 --> 0:08:03.200 to spend. So we definitely seen that full back discounting 0:08:03.280 --> 0:08:05.480 is very heavy at the moment. We already have a 0:08:05.480 --> 0:08:08.800 couple of retailers came out already downgraded, not on the 0:08:08.840 --> 0:08:12.000 revenue front, but more so on the march because they 0:08:12.040 --> 0:08:14.280 have to discount. So I do think that will become 0:08:14.320 --> 0:08:17.600 a theme for this year because retailers are sitting at 0:08:17.800 --> 0:08:19.920 very big margins for the last couple of years because 0:08:19.960 --> 0:08:21.880 things been good. You know, they do have to give 0:08:21.960 --> 0:08:23.000 some of that back. 0:08:22.840 --> 0:08:26.600 This year, okay, and on the dividend yield. So the 0:08:26.600 --> 0:08:31.400 point we were making is that cushion is fading for 0:08:31.560 --> 0:08:35.559 Australian stocks. That the ability that you could always say, 0:08:35.559 --> 0:08:36.960 well you're going to get four and a half percent 0:08:37.000 --> 0:08:38.800 whatever happens, but you're only going to get three and 0:08:38.800 --> 0:08:41.320 a half percent. Now, that puts more pressure on the 0:08:41.320 --> 0:08:42.959 stocks to grow, doesn't it. 0:08:45.240 --> 0:08:48.560 In a way. So I think part of the reason 0:08:48.600 --> 0:08:51.600 the dividend has been steadily falling is one is that 0:08:51.880 --> 0:08:54.760 you know, clearly our banks is already sort of peaked 0:08:54.800 --> 0:08:56.719 in terms of their earning, so it's not growing in 0:08:56.800 --> 0:08:59.360 terms of dividend. And two is the last few years 0:08:59.400 --> 0:09:03.160 that resources company which normally pay big dividend, has been 0:09:03.200 --> 0:09:08.119 really tough. But we just started seeing those commodity prices 0:09:08.120 --> 0:09:11.640 turning around significantly. If you look at just take PHPO 0:09:11.760 --> 0:09:14.360 or Real as an example, both of them are sitting 0:09:14.360 --> 0:09:17.600 there with thirty percent earnings upgrade to come in this 0:09:17.760 --> 0:09:21.640 reporting season because how much commodity price has moved. Just 0:09:21.720 --> 0:09:25.120 this month, the commodity prices all up double digit. So 0:09:25.360 --> 0:09:28.240 that means these companies normally pay out quite a lot 0:09:28.240 --> 0:09:30.960 of dividends and that should see the dividend improved for 0:09:31.080 --> 0:09:34.720 this year. But definitely they will put pressure on companies 0:09:34.760 --> 0:09:37.959 because the Australian investors always demanded higher dividends. 0:09:38.400 --> 0:09:43.240 So do you think the big miners the mining sector 0:09:43.360 --> 0:09:46.720 in it it could actually revive the dividend yield across 0:09:46.760 --> 0:09:48.599 the market, it's self a structural decline. 0:09:49.960 --> 0:09:52.520 I think they will pay more, but one of my 0:09:52.600 --> 0:09:54.480 concerns for the Big Mind at the moment is that 0:09:54.559 --> 0:09:57.400 they're making so much cash flow at the moment, almost 0:09:57.440 --> 0:10:00.680 like a windfall, and they historically have being very bad 0:10:00.760 --> 0:10:03.240 in paying out shareholder and they'll hold on to the 0:10:03.280 --> 0:10:05.720 cash then normally would like to go out and buy 0:10:05.720 --> 0:10:08.000 things to grow. You know, managements sit around the table 0:10:08.000 --> 0:10:09.920 going how do we grow in next year? And we're 0:10:09.960 --> 0:10:11.040 already started seeing a. 0:10:10.960 --> 0:10:11.280 Bit of that. 0:10:11.400 --> 0:10:13.600 So the challenge is that hopefully they don't go out 0:10:13.600 --> 0:10:15.640 and slowly spend all the money. But I think it 0:10:15.679 --> 0:10:17.760 looks they will be a bit disciplined because you know, 0:10:17.800 --> 0:10:21.199 shareholder room punish these sort of nowsal quite quickly. 0:10:21.720 --> 0:10:23.960 Okay, very interesting now, folks, what we're going to do 0:10:24.040 --> 0:10:25.760 is we're going to we're going to deep dive. Now, 0:10:25.800 --> 0:10:27.079 we're going to go and have a look at first 0:10:27.120 --> 0:10:28.280 of all, and I think this is going to be 0:10:28.400 --> 0:10:30.280 very interesting. We're going to look at the miners. We're 0:10:30.320 --> 0:10:33.080 going to look the mining shares of what risks and 0:10:33.080 --> 0:10:35.840 opportunities you have in front of you, which as JB. 0:10:35.960 --> 0:10:38.120 Has said it is red hot, and it is red hot. 0:10:38.160 --> 0:10:40.240 I can't think of the time. I think you'd have 0:10:40.240 --> 0:10:43.240 to go back nearly twenty years two four to two 0:10:43.240 --> 0:10:45.559 o seven to see to see the sort of momentum 0:10:45.600 --> 0:11:05.040 in the big miners. We'll be back in a moment. Hello, 0:11:05.200 --> 0:11:08.600 Welcome back to The Australian's Money Puzzle podcast. Okay, this 0:11:08.720 --> 0:11:13.160 is the second of our Outlook shows four twenty twenty 0:11:13.200 --> 0:11:16.679 sixties are always very popular and if you can, I 0:11:16.720 --> 0:11:19.640 recommend you actually listen to them in sequence because you'll 0:11:19.679 --> 0:11:23.319 really get a broad picture for investing in the year 0:11:23.320 --> 0:11:25.360 ahead and it is very useful. 0:11:25.559 --> 0:11:25.760 You know. 0:11:26.040 --> 0:11:27.920 One of the secrets of investing is not what you 0:11:27.960 --> 0:11:30.640 think is going to happen. It's knowing what everyone else 0:11:30.720 --> 0:11:33.120 is thinking is going to happen. And this is what 0:11:33.160 --> 0:11:35.200 these shows are about. They do really give you a 0:11:35.200 --> 0:11:37.480 guide if you use them in that fashion. My guest 0:11:37.480 --> 0:11:41.320 today is Jun Belu of ten Cap. Ten Cap is 0:11:41.559 --> 0:11:45.000 a one point five billion dollar fund. It is an 0:11:45.040 --> 0:11:47.920 active manager. It is long short, which is very interesting. 0:11:48.160 --> 0:11:49.880 That is they have the ability to short should they 0:11:49.920 --> 0:11:53.760 wish to do so. It started basically it has a 0:11:53.800 --> 0:11:57.960 net return ruffling of about eleven point two percent since 0:11:58.000 --> 0:12:01.960 its inception. That's against the air six two hundred of 0:12:02.120 --> 0:12:04.679 eight point nine percent over the same period of time. 0:12:04.920 --> 0:12:07.199 And if you want to know more about my guest today, 0:12:07.240 --> 0:12:10.160 We've had a show that was very popular that Juliane 0:12:10.440 --> 0:12:14.240 Sprague did with JB earlier in the year, which is 0:12:14.280 --> 0:12:16.640 called Secrets of a one point five billion Investor. Have 0:12:16.679 --> 0:12:18.080 a look at that if you want to know more 0:12:18.120 --> 0:12:20.120 about her today, I just want to concentrate on what 0:12:20.160 --> 0:12:22.280 she knows about the market and what she's thinking. Okay, 0:12:22.440 --> 0:12:24.840 now the miners, Okay, where will we start? The big 0:12:24.840 --> 0:12:30.199 three BHP, Rio and Forteskew. As you say, they've been 0:12:30.400 --> 0:12:32.960 somewhat dormant, but boy, they were kicking at the end 0:12:32.960 --> 0:12:35.079 of last year. It takes a hell of a lot 0:12:35.120 --> 0:12:37.440 to lift those stocks. They're up about twenty five percent 0:12:37.600 --> 0:12:39.800 so far in the twelve month period. That is a 0:12:39.880 --> 0:12:43.920 bhp in Rio. And when they deliver dividends, they deliver 0:12:44.200 --> 0:12:46.400 gigantic dividends, don't they. They just blow it out of 0:12:46.440 --> 0:12:48.160 that They blow the banks out of the water when 0:12:48.160 --> 0:12:49.960 they're at the top of the cycle. So where do 0:12:50.000 --> 0:12:52.120 you think we are with these big miners just now? 0:12:52.160 --> 0:12:55.120 I mean is there is there more to come? Are 0:12:55.120 --> 0:12:57.480 we are they? Where are they in their own cycle? 0:12:57.520 --> 0:12:59.160 Because they are notoriously cyclical. 0:13:00.520 --> 0:13:03.240 Yeah, absolutely certainly, Minus are not what you buy and 0:13:03.280 --> 0:13:05.680 hold and your bottom drawer sort of thing. Look at 0:13:05.720 --> 0:13:08.520 they are still looking at having a pretty good year, 0:13:08.880 --> 0:13:11.840 But it really depends on what type of commodity is. 0:13:11.880 --> 0:13:14.560 So for if our commodity outlook, if you look at 0:13:14.559 --> 0:13:17.360 the support, you know, the structural names such as copper 0:13:17.720 --> 0:13:20.720 or certainly some cases gold and maybe even al aminium 0:13:20.840 --> 0:13:23.560 has some of the structural supports. In terms of copper, 0:13:23.760 --> 0:13:27.320 you know, it's electrification and the demand globally, demand for 0:13:27.440 --> 0:13:30.760 copper has really increased, and then the supply just hasn't 0:13:30.800 --> 0:13:32.720 been there and we all know that's going to create 0:13:32.840 --> 0:13:35.760 price this location. And we're seeing copper going to have 0:13:35.800 --> 0:13:38.719 another strong yet because there's just a supply with it. 0:13:38.800 --> 0:13:41.880 Iron ore is a bit harder because a big consumer 0:13:41.920 --> 0:13:44.640 of iron oil is actually China, and China hasn't really 0:13:44.720 --> 0:13:47.360 revived that much. It's just not doing any worse. So 0:13:47.640 --> 0:13:50.320 China is steady, and then we're looking at globally the 0:13:50.360 --> 0:13:52.719 demand is actually picking up a little bit. So yeah, 0:13:52.760 --> 0:13:55.560 I think all these commodities are well supported, so our 0:13:55.640 --> 0:13:58.520 minus probably still another good year. You know, probably not 0:13:58.559 --> 0:14:01.680 going to see that twenty thirty percent range for the 0:14:01.800 --> 0:14:05.280 large miners, particularly because we are now already seeing a 0:14:05.280 --> 0:14:08.199 lot of earnings upgrade coming through. In February this year, 0:14:08.200 --> 0:14:11.560 we're going to see something like twenty thirty percent earnings 0:14:11.640 --> 0:14:14.840 upgrade for a company for these large miners, FORTESQ, if 0:14:14.880 --> 0:14:18.280 you like, actually here looking at even bigger upgrades, so 0:14:18.440 --> 0:14:20.520 you know, it's quite a lot of earnings upgrade, big 0:14:20.560 --> 0:14:23.320 dividend to come through for them. You know, this reporting 0:14:23.320 --> 0:14:25.880 season and I think next reporting season August we're going 0:14:25.880 --> 0:14:28.760 to see an even larger name. But then posta we 0:14:28.920 --> 0:14:31.640 really have to see whether globally, you know, where we 0:14:31.760 --> 0:14:34.440 stand in terms of the global bombers, But certainly first 0:14:34.440 --> 0:14:36.640 half they're going to continue to do pretty well. 0:14:37.680 --> 0:14:39.720 It sounds to me like you're saying that to some 0:14:39.800 --> 0:14:42.520 extent it's priced in the Big three, But there is 0:14:42.560 --> 0:14:44.920 such a huge mining sector and we can look further 0:14:44.960 --> 0:14:47.440 down the line at what is available out there. So 0:14:47.560 --> 0:14:50.240 if copper is like this year's thing right this year 0:14:50.320 --> 0:14:53.760 is hot metal, so to speak, where could we enter 0:14:54.120 --> 0:14:57.160 as an investor? What sort of stocks are you looking 0:14:57.200 --> 0:15:00.200 at beyond those big three? And Fortescue isn't even in 0:15:00.320 --> 0:15:02.480 the game here, is it? Really? It's iron or almost 0:15:02.640 --> 0:15:05.800 and real with very heavily iron or BHP is more diversified. 0:15:06.080 --> 0:15:09.040 But beyond those big three, what's the next layer of stocks? 0:15:09.400 --> 0:15:12.440 Let's start talking about individual stocks. Yeah. 0:15:12.480 --> 0:15:15.120 Absolutely, there's a lot of interesting names. So in terms 0:15:15.120 --> 0:15:18.000 of copper, you want to play pure play slightly larger. 0:15:18.040 --> 0:15:20.840 One is the sam Fire. It has you know, has 0:15:20.880 --> 0:15:24.200 a really good copper exposure, but said by is very expensive. 0:15:24.440 --> 0:15:26.880 Then you go even smaller. The next one you can 0:15:26.920 --> 0:15:30.480 look at is Capstole. It's due listed in Canada and 0:15:30.520 --> 0:15:33.320 then also you know in Australia it's got a really 0:15:33.320 --> 0:15:35.760 good production growth as well. Because one of the things 0:15:35.760 --> 0:15:37.640 about minor is there not only commodities, you get a 0:15:37.720 --> 0:15:40.880 right each by company actually growing production and also can 0:15:40.920 --> 0:15:43.800 benefit from high prices right now, So I think Capstole 0:15:43.920 --> 0:15:46.080 is a really good one to look at. What's also 0:15:46.160 --> 0:15:48.880 interesting is so if you look at the copper price 0:15:48.920 --> 0:15:51.880 that's gone really well, there is the next derivative. So 0:15:52.120 --> 0:15:55.040 when usually globally where copper price go really high, there's 0:15:55.040 --> 0:15:58.720 some sectors they started moving into some substituting effects. So 0:15:58.920 --> 0:16:01.360 instead of copper, it might be to use al aminium. 0:16:01.440 --> 0:16:04.320 So if you look at the prices of aluminium, normally 0:16:04.400 --> 0:16:07.600 they trace copper, and so far at the moment aluminium 0:16:07.640 --> 0:16:11.080 actually underperformed comper Now I'm not a mining specialist, but 0:16:11.360 --> 0:16:13.040 you know if you look at what that means is 0:16:13.040 --> 0:16:16.240 that potentially, you know, with strong copper, alominium will have 0:16:16.360 --> 0:16:17.320 it stay in the sun. 0:16:17.680 --> 0:16:20.520 So there's like a like a reliable ratio like LPG 0:16:20.600 --> 0:16:21.640 two oil or whatever. 0:16:21.480 --> 0:16:23.040 Very reliable ratio. That's right. 0:16:23.320 --> 0:16:25.200 Who are the players in that space? 0:16:25.480 --> 0:16:28.800 Yeah, so the easiest purest play is our CoA And 0:16:29.040 --> 0:16:32.000 clearly the share price actually gone incredibly well. And that's 0:16:32.040 --> 0:16:35.040 again Julis said, it's not just pure here and then 0:16:35.160 --> 0:16:37.800 you know, obviously it's and it's for a cousin which 0:16:38.240 --> 0:16:41.680 has had many production issues, which is South thirty two. Now, 0:16:42.040 --> 0:16:45.200 being mindful mining companies, you do really need to know 0:16:45.240 --> 0:16:48.480 what's happening in total mind production. South thirty two has 0:16:48.480 --> 0:16:50.760 had a lot of issues. It's one of those companies 0:16:50.760 --> 0:16:53.840 people always say you buy it before the result or 0:16:53.880 --> 0:16:56.320 after the result, but not during the result because they're 0:16:56.320 --> 0:16:58.960 always disappoint So just be bringing mindful when you move 0:16:59.000 --> 0:17:02.120 away from the large chap the smaller ones they generally 0:17:02.240 --> 0:17:04.960 have issues and you just got to do the homework. 0:17:05.040 --> 0:17:06.320 Be very careful with those things. 0:17:06.359 --> 0:17:09.040 Can I ask you in your own fund beyond the 0:17:09.040 --> 0:17:12.160 big three bhp real and for the SKU, what would 0:17:12.200 --> 0:17:14.160 the peer ibor was looking at your fund and looking 0:17:14.200 --> 0:17:15.880 at the biggest holdings. 0:17:16.480 --> 0:17:19.439 Sure, so aside from the larger so larger ones, we 0:17:19.520 --> 0:17:21.760 actually have more PHV than the real because you know 0:17:21.840 --> 0:17:24.600 we go through later on, we have that, we have 0:17:24.720 --> 0:17:27.439 the capsule, we have the same fire, we have the 0:17:27.480 --> 0:17:29.879 alcohol as well, a little bit of self rearly to 0:17:30.000 --> 0:17:32.960 smaller position because a little bit, you know, it needs 0:17:32.920 --> 0:17:34.240 to be careful with those socks. 0:17:34.760 --> 0:17:36.600 Operational risk as they call. 0:17:36.480 --> 0:17:40.880 It, operational risk, it's very large, that's right, it's really therefore, 0:17:41.119 --> 0:17:43.600 you know for a period where you've seen that aluminium 0:17:43.680 --> 0:17:46.520 price catch up. And also one thing we haven't talked 0:17:46.560 --> 0:17:48.680 about is the gold set, that goal set. 0:17:48.440 --> 0:17:52.919 I'm going to do. I don't think I have a 0:17:52.920 --> 0:17:55.159 little of gold. Let's do it. Let's do it. Just 0:17:55.200 --> 0:17:58.560 before we do it, folks. Something that JB has pointed 0:17:58.560 --> 0:18:03.320 out and it's so true and it's just extraordinary. Don't 0:18:03.320 --> 0:18:08.239 for one moment think that because a company owns a 0:18:08.320 --> 0:18:12.760 gold mine and gold is rising at its fastest pace 0:18:13.359 --> 0:18:16.360 since the nineteen eighties, don't for one moment think they 0:18:16.400 --> 0:18:19.199 can't blow it. They can blow it every time, it 0:18:19.240 --> 0:18:21.760 doesn't matter. They can be sitting on a gold mine, 0:18:21.760 --> 0:18:26.159 so to speak, with the most marvelous external macro conditions, 0:18:26.200 --> 0:18:28.600 and unbelievably they can blow it. And one of the 0:18:28.600 --> 0:18:32.960 things in this market, and people regret that Newcrest, which 0:18:33.040 --> 0:18:35.439 was our biggest goal miner, was sold back in twenty 0:18:35.480 --> 0:18:38.520 twenty three to Numont and it was a giveaway and 0:18:38.560 --> 0:18:41.720 it was an exquisitely time purchased by Numont and a 0:18:41.840 --> 0:18:44.639 terrible loss for Australia. But what people forget is that 0:18:44.720 --> 0:18:48.600 Newcrest was the greatest disappointer on operational risk. Talk about 0:18:48.600 --> 0:18:52.880 things going wrong every time. So with that preamble, jombat 0:18:53.880 --> 0:18:56.240 a couple of things. Let's let's set the ground here. 0:18:57.440 --> 0:19:01.960 Gold is running extraor in extraordinary run, and it's entirely 0:19:02.040 --> 0:19:06.200 understandable and rational because of the mounting risks in world economy, 0:19:06.480 --> 0:19:08.560 primarily in the US, primarily off the back of the 0:19:08.600 --> 0:19:14.119 Trump administration's behavior. Now, on that basis, I think we 0:19:14.160 --> 0:19:16.600 can be confident that it will keep going. Gold is 0:19:16.680 --> 0:19:19.320 up about very roughly, up about sixty percent in the 0:19:19.400 --> 0:19:24.760 last felve months. Gold miners who tend to lag gold 0:19:24.800 --> 0:19:28.120 itself for commodity, they are up. That is our own 0:19:28.160 --> 0:19:31.480 ASX gold sector is up about one hundred and forty 0:19:31.560 --> 0:19:34.080 percent twice as fast as goes. So we can put 0:19:34.080 --> 0:19:36.040 it on the table. There's a enormous opportunity and I'm 0:19:36.080 --> 0:19:41.680 still excellent opportunity left foreign investors in gold stocks. Where 0:19:41.680 --> 0:19:42.240 do we start? 0:19:43.920 --> 0:19:46.359 You're absolutely right, I think where do we start? So 0:19:46.640 --> 0:19:50.119 with the goal companies, And you know one reason for 0:19:50.280 --> 0:19:53.840 why goal companies always lack the goal prices. First of all, 0:19:54.000 --> 0:19:56.520 goal prices can be affected by so many things, and 0:19:56.680 --> 0:19:59.720 often it trends in directions that we don't expect. Now, 0:20:00.000 --> 0:20:03.560 So with the so when people forecast gold equity prices, 0:20:03.720 --> 0:20:06.639