TOL - 19th Aug, 2023
Blackwattle's Ray David is raising red flags about market darling CSL
Plus, the company with the best suite of assets on the ASX
There are a select few stocks on the ASX that boast true market darling status. Where other stocks sell off at the hint of bad news, market darlings seem to emit an aura effect on markets that itself attracts investment.
Biotechnology giant CSL is arguably the Aussie market’s preeminent market darling, having returned 5,741% since inception.
For a while, it seemed like CSL could do no wrong. But, as the recent earnings downgrade demonstrated, even royalty can be dethroned.
With that said, today’s guest is Ray David, Portfolio Manager and Partner at Blackwattle Investment Partners. Along with Schroders alumni Joseph Koh, Ray runs Blackwattle’s brand new Long-Short Quality Fund.
Ray has a red flag system for identifying his short and underweight positions. He put CSL through the ringer and, as you’ll learn today, it spat out a sea of red flags.
He also discusses the Ponzi scheme that sparked his interest in investment finance, why he’s bullish BHP irrespective of the commodity cycle, the new era in short selling, his overweight positions in industrials, and the media company with the best suite of assets on the ASX.
Note: This interview was recorded on August 15, 2023.
Timestamps
- 0:00 - START
- 1:56 - A ponzi introduction to finance
- 5:30 - Lessons from the the Buy and Sell sides of the industry
- 10:00 - Have risk assets beaten central banks?
- 11:46 - The bear case for banks
- 14:00 - Defining 'quality'
- 18:00 - A new era for short selling
- 22:54 - Red flags for CSL
- 27:00 - Overweight industrials
- 29:10 - The best asset book on the ASX
- 30:26 - Reporting season buys
- 34:40 - Mining needs explosives
- 37:37 - Franchising done right
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6 stocks mentioned
1 contributor mentioned
Livewire Markets
The Rules of Investing is one of Australia's top investing podcasts. We interview the leading investment minds from Australia and overseas to better understand their processes and philosophy. After launching in October 2017, there have been over...
Livewire Markets
The Rules of Investing is one of Australia's top investing podcasts. We interview the leading investment minds from Australia and overseas to better understand their processes and philosophy. After launching in October 2017, there have been over...
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