15 years of Forager and that 50 basis point US rate cut

In the most recent installment of Stocks Neat, we unpack the latest market moves, spotlight companies like Motorpoint and Ferguson poised to benefit from lower rates, and share their strategies amidst ongoing volatility. 

The discussion explores resilient businesses, the correlation between rate cuts and small-cap outperformance, and how Forager has evolved over the past 15 years.

Tune in as we reveal current opportunities and what the future may hold for investors navigating this changing landscape.‍

"Rate cuts, especially unexpected rate cuts, tend to benefit the more marginal businesses. Think heavily-geared businesses, cyclical industries, lower-margin businesses, companies that don't necessarily lead their markets of secondary and tertiary companies"

0:00 - Intro and explanation of moving to quarterly podcasts.

2:35 - Discussion about the 50 basis point rate cut in the US, its surprise to the market, and the implications for portfolios.

4:12 - Analysis of banks benefiting from rising rates and the unique situation for European banks in Forager's portfolio.

7:03 - Exploration of Motorpoint and how higher interest rates have impacted its sales and commissions, with hopes for improvement as rates fall.

12:21 - Discussion on market reactions to rate cuts and the broader implications for small versus large cap stocks.

22:49 - Deep dive into Forager’s investment strategy of starting small in distressed businesses, then upsizing as confidence grows.

Explore previous episodes here. We’d love your feedback. If you like what you’re hearing (and what we’re drinking), be sure to follow and subscribe – we’re doing this every quarter.