Day: 24 January 2022

The S&P/ASX 200 Index (ASX: XJO) has kicked the week off on the wrong side of the bed yet again this Monday. At the time of writing, the ASX 200 has lost 0.54% and is currently sitting at 7,137 points. 

But not to let that get us down, let’s now take a gander at the 3 ASX 200 shares that are currently at the top of the ASX’s volume charts, according to investing.com.

The 3 most traded ASX 200 shares by volume on Monday

Sydney Airport (ASX: SYD)

Sydney Airport is our first share with soaring trading volumes today. This ASX 200 infrastructure giant has had a hefty 23.51 million of its shares swap hands so far this Monday. There’s not much in the way of news or announcements out of the company itself so far.

So we can probably put this elevated volume down to the movements of the Sydney Airport share price itself, and perhaps at its potential upcoming takeover. Sydney Airport is currently flat at $8.66 a share, but has been doing some bouncing around today. It might be this volatility, together with the takeover factor, that is behind this volume today.

South32 Ltd (ASX: S32)

Diversified ASX 200 mining company South32 is next up today. A whopping 25.42 million South32 shares have been bought and sold so far today. We don’t have to look too far to explain this one though. This volume is the likely consequence of the performance report South32 released to investors today.

As my Fool colleague Brooke covered earlier this Monday, South32 revealed that it had a rough period over the last quarter, experiencing labour and supply-chain issues. As such, it was forced to downgrade its FY22 guidance. The South32 share price has lost an unpalatable 3.8% so far today and is now trading at $3.94 a share.

Pilbara Minerals Ltd (ASX: PLS)

ASX 200 lithium producer Pilbara is our final and (so far) most traded share of the day. This Monday has seen a sizeable 25.51 Pilbara shares find a new home at this point of the trading day.

Again, there isn’t any official news out of Pilbara that we can point to that might explain this move. So perhaps it is the nasty share price fall this company has endured today that is the culprit here. Pilbara shares have lost 1.4% so far this Monday and are currently trading at $3.51 each. This might be the reason why we find Pilbara on this list today. 

The post Here are the 3 most heavily traded ASX 200 shares this Monday appeared first on The Motley Fool Australia.

More reading

• Why are these beaten-up small cap ASX tech shares seeing 52-week lows today?
• The Nasdaq is in correction territory. Is the ASX 200 next?
• Why is the South32 (ASX:S32) share price tumbling 5% on Monday?
• Top fund manager says don’t buy the share market dip
• 5 things to watch on the ASX 200 on Monday

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Key points

• NAB has reportedly been served a class action alleging it breached Australian Consumer Law
• The claim follows the 2013 collapse of construction business Walton Group
• The bank allegedly allowed Walton to trade insolvent to recover a $16 million debt, after which subcontractors reportedly wore $80 million of non-payments

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Owners of National Australia Bank Ltd (ASX: NAB) shares might want to keep an ear out for news of a class action after reports emerged claiming the bank could be facing a $200 million lawsuit.

The class action reportedly relates to the collapse of Walton Group in 2013. It’s said to include the claim NAB – Walton Group’s financial backer – worked to recover $16 million of funds before the company went under, but left subcontractors in the red.

At the time of writing, the NAB share price is $28.20, down 0.42% on the day.

Let’s take a closer look at the rumoured class action against the big bank.

Is NAB set to face a major class action?

According to reporting by the Australian Financial Review, NAB might have breached Australian Consumer Law by allowing Walton Group to trade insolvent for months before it went belly-up.

Lawyer Robert Armstrong is said to be leading the class action on behalf of 1,400 subcontractors.

The subbies claim the construction company owed them more than $80 million when it collapsed. Losses from the non-payment, including interest and resulting damages, could amount to more than $200 million.

The publication quoted Armstrong as saying:

[Walton] ought to have called in a receiver. Instead, what they did was appoint a restructuring group on the strong recommendation of the NAB. It allowed them 6 months to delay putting in receivership while they secured and recovered their funds. Almost the next day it went into receivership.

It wasn’t long ago Motley Fool Australia reported on another class action again NAB. In June 2021, the bank settled a United States-based class action alleging the bank manipulated the Bank Bill Swap Rate.

NAB share price snapshot

So far, 2022 has not been kind to the NAB share price.

The bank’s stock has slipped 2.22% since the end of 2021. Though it’s still almost 17% higher than it was this time last year.

The post Own NAB (ASX:NAB) shares? Here’s why the bank could be facing a $200m class action appeared first on The Motley Fool Australia.

More reading

• What’s happening to ASX bank shares today?
• 2 ASX dividend shares with large and growing yields
• Does the NAB (ASX:NAB) share price make it the best value bank right now?
• 2 buy-rated ASX dividend shares with generous yields
• NAB (ASX:NAB) share price target raised at Morgan Stanley. So, is it a buy?

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Key points

• Listed Investment Company AFIC has just released is half-year results
• A surge in received dividends help raise profits by 74%
• Interim dividend of 10 cents per share (steady over FY21) was announced

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The Australian Foundation Investment Co Ltd (ASX: AFI) share price has fallen this Monday after the Listed Investment Company (LIC) released its FY2022 half-year earnings results for the six months to 31 December 2021. AFIC shares are currently trading at $8.58 each at the time of writing, down by 0.7%. That comes after the company closed at $8.66 a share last week and opened at $8.64 this morning.

AFIC share price falls despite solid first half update

• Revenue from operating activities rises to $161.8 million, up 68.1% from the $65.6 million reported for the first half of FY2021 (prior corresponding period, or pcp).
• Profit after tax of $146 million, up 73.5% on pcp’s $84.1 million
• Interim dividend of 10 cents per share, fully franked, announced. That is unchanged from the prior period.
• Return of 6.9% for AFIC’s portfolio for six months to 31 December (including franking). That compares to 4.6% for the S&P/ASX 200 Index (ASX: XJO).

What else happened in the first half?

As a LIC, AFIC’s primary business is investing in an underlying portfolio of (mostly) ASX shares for the benefit of shareholders. The company tells us that its outperformance for the first half of FY22 was mainly driven by its investments in Macquarie Group Ltd (AS:X MQG) and Sydney Airport (ASX: SYD). As well as in Goodman Group (ASX: GMG) and James Hardie Industries plc (ASX: JHX).

Additionally, AFIC told investors that it took advantage of “attractive prices” sparked by “short-term volatility” to increase its holdings. Positions added to include Transurban Group (ASX: TCL), Coles Group Ltd (ASX: COL) and CSL Limited (ASX: CSL), amongst others. The LIC also initiated positions in JB Hi-Fi Limited (ASX: JBH) and WiseTech Global Ltd (ASX: WTC).

Meanwhile, management also said that AFIC exited positions in APA Group (ASX: APA), Origin Energy Ltd (ASX: ORG) and Altium Limited (ASX: ALU).

In regards to its large lift in revenues and profit, AFIC thanked large dividend rises from many of its top holdings. In particular BHP Group Ltd (ASX: BHP) and Macquarie.

What did management say?

Management had this to say on the results AFIC delivered this morning:

The Australian equity market continued to deliver gains in the six months to 31 December 2021 following on from the very strong rebound in markets in the first six months of the calendar year. While market valuations remained higher than historical levels, as a result of continued low interest rates, corporate earnings growth remained strong supported by improved economic activity…

AFIC is an investor with a long term focus… This performance has been achieved with lower portfolio volatility than the market and more consistent dividend income.

What’s next?

Going forward into 2022, AFIC’s management stated that the company’s strategy of owning a diversified portfolio of quality companies well placed to deliver growth in earnings over time “remains appropriate” for the 2022 investing environment. Management says that it is well placed to take advantage of any bouts of volatility to increase its holdings in its top ideas. Furthermore, the company stated that its portfolio is “soundly positioned” despite the “risks of rising interest rates and global uncertainty”.

AFIC share price snapshot

AFIC shares have had a pretty robust time over the past few months. The company remains up 1.06% year to date so far in 2022. As well as up 13.6% over the past 12 months. At the current share price, AFIC is offering a trailing and fully franked dividend yield of 2.8%.

The post AFIC (ASX:AFI) share price falls despite 74% rise in profits appeared first on The Motley Fool Australia.

More reading

• How is AFIC (ASX:AFI)’s international share portfolio going?
• Why are AFIC (ASX:AFI) shares so popular among young investors?
• How did the AFIC (ASX:AFI) share price manage to outperform in 2021?

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Altium, CSL Ltd., and WiseTech Global. The Motley Fool Australia owns and has recommended APA Group, COLESGROUP DEF SET, and WiseTech Global. The Motley Fool Australia has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Key points

• AMP shares are down 41% over the last 12 months
• Citi believes value could be emerging
• However, it may be too soon to know for sure

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The AMP Ltd (ASX: AMP) share price has started the week in the red.

In afternoon trade, the financial services company’s shares are down 1.5% to 91.5 cents.

This means the AMP share price is now down 8% in 2022 and 41% over the last 12 months.

Is the AMP share price good value now?

One leading broker has been running the rule over the AMP share price and has given its verdict.

According to a note out of Citi, its analysts feel that value could be emerging in AMP’s shares but warned that it still may be too soon to know for sure.

In light of this, the broker has retained its neutral high risk rating and cut its price target on the company’s shares to $1.10.

This price target implies potential upside of 16% for the AMP share price over the next 12 months.

What did the broker say?

Citi commented: “At face value, AMP’s sale of its infrastructure debt business to Ares Capital for 6% of AuM announced pre-Christmas looks like a reasonable deal but it leaves Private Markets as an even smaller business comprising only equity investments in infrastructure and real estate. Still capital to support these business now looks adequate.”

“We factor this sale into our estimates as well as marking to market and making other mostly small adjustments. We reduce EPS by 2%/4%. While it is possible there is value in AMP, there is too much going on to assess this with certainty. We retain our Neutral/High risk call lowering our target price to A$1.10 with this now set at a ~20% (was ~10%) discount to our valuation to reflect well above average uncertainty,” the broker added.

The post Is value finally emerging in the AMP (ASX:AMP) share price? appeared first on The Motley Fool Australia.

More reading

• AMP (ASX:AMP) latest to join call for RBA interest rate hike in August 2022
• Own AMP (ASX:AMP) shares? Here’s why this expert downgraded some of its funds
• When did AMP (ASX:AMP) last pay a dividend and when might the next one be?
• Leading brokers name 3 ASX shares to sell today
• Why did the AMP (ASX:AMP) share price fall 35% in 2021?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Key points

• ASX bank shares remain on edge
• Macquarie, ANZ, and Westpac are in the red today
• Commonwealth Bank is in the green
• The US Federal Reserve will hold a 2 day policy event this week, while the Australian RBA will meet next week

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ASX bank shares are having a mixed day on the market today as investors remain on edge amid interest rate speculation.

Among the fallers, Macquarie Group Ltd (ASX: MQG) is down 0.61% while Australia and New Zealand Banking Group Ltd (ASX: ANZ) is 1.1% lower at the time of writing. Meanwhile, the Commonwealth Bank of Australia (ASX: CBA) share price is up 0.32%.

Let’s take a closer look at the performance of ASX bank shares today.

What’s happening to ASX bank shares?

Among other banks on Monday, the National Australia Bank Ltd (ASX: NAB) share price is 0.46% lower while Westpac Banking Corp (ASX: WBC) is 0.6% in the red.

The Bank of Queensland Ltd (ASX: BOQ) share price is flat at the time of writing while Bendigo and Adelaide Bank Ltd (ASX: BEN) is down 0.28%.

It’s no surprise the broader S&P/ASX 200 Financials Index (ASX: XFJ) is also down. It’s 0.43% lower at the time of writing.

That’s roughly in line with the S&P/ASX 200 Index (ASX: XJO) which is down 0.45% so far today.

However, it seems, Australian bank shares are outperforming their US counterparts. The Dow Jones U.S. Banks Index dropped 2.4% in Friday’s trade. Bank of America (NYSE: BAC) dropped 1.81%, Citigroup (NYSE: C) fell 1.85%, and Wells Fargo & Co (NYSE: WFC) plunged 2.42%.

US markets are not trading as yet amid mounting speculation of interest rate rises. CBNC reported Goldman Sachs is expecting four interest rate rises this year. Goldman economist David Mericle said in a Saturday note:

Our baseline forecast calls for four hikes in March, June, September, and December.

It’s no secret the Reserve Bank of Australia (RBA) often takes its lead from the US Federal Reserve.

And as my Fool colleague Bernd reported today, the Fed and other central banks, including the Reserve Bank of Australia, may have little choice but to tighten policies this year due to rising inflation.

Increasing rates can help bank shares as they improve the profit margins on loans.

The US Fed will be holding a two-day policy meeting on Tuesday and Wednesday where it is expected to give more clarity on its rate rise intentions. The next Reserve Bank of Australia board meeting is scheduled for next week on Tuesday 1 February.

The post What’s happening to ASX bank shares today? appeared first on The Motley Fool Australia.

More reading

• Here’s when Westpac (ASX:WBC) expects the RBA to raise the cash rate
• 2 buy-rated ASX 200 dividend shares with great yields
• Westpac (ASX:WBC) share price in focus after raising loan interest rates again
• 2 ASX dividend shares with large and growing yields
• Does the NAB (ASX:NAB) share price make it the best value bank right now?

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Wells Fargo is an advertising partner of The Ascent, a Motley Fool company. Bank of America is an advertising partner of The Ascent, a Motley Fool company. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns and has recommended Bendigo and Adelaide Bank Limited. The Motley Fool Australia has recommended Macquarie Group Limited and Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) is out of form again on Monday. In afternoon trade, the benchmark index is down 0.5% to 7,138.6 points.

Four ASX shares that are not letting that hold them back today are listed below. Here’s why they are rising:

Corporate Travel Management Ltd (ASX: CTD)

The Corporate Travel Management share price is up 3% to $20.77. This gain appears to have been driven by a broker note out of Morgan Stanley this morning. According to the note, the broker has retained its overweight rating and lifted its price target on the corporate travel specialist’s shares to $28.00. Morgan Stanley believes the company is one of the best reopening plays for investors.

Goodman Group (ASX: GMG)

The Goodman share price is up 3.5% to $23.40. Investors have been buying this property company’s shares following the release of a broker note out of Macquarie. Its analysts have retained their outperform rating and lifted their price target to $26.63. Macquarie believes Goodman could upgrade its guidance for FY 2022 when it releases its half year results.

Lendlease Group (ASX: LLC)

The Lendlease share price is up 2.5% to $10.42. Macquarie also spoke positively about Lendlease. In fact, the broker upgraded its shares to an outperform rating with a $12.64 price target. Its analysts believe that Lendlease’s shares could rerate to higher multiples in the future once it starts to become apparent that it will meet its FY 2024 targets.

Uniti Group Ltd (ASX: UWL)

The Uniti share price is up 10% to $4.16. This morning the telco revealed that it has received takeover approaches from more than one company in recent months. However, no names were given, nor was the company able to provide details relating to timing, price, or conditions. It also warned that there is no guarantee that such approaches will result in any substantive proposals emerging.

The post Why Corporate Travel Management, Goodman, Lendlease, and Uniti shares are rising today appeared first on The Motley Fool Australia.

More reading

• Here are the latest broker updates from Macquarie. It’s not all pretty for ASX shares.
• Why is the Uniti (ASX:UWL) share price up 10% on Monday?
• Leading brokers name 3 ASX shares to buy today
• 3 ASX growth shares to buy after the market meltdown
• 2 strong ASX shares profiting from the e-commerce boom

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Corporate Travel Management Limited and Uniti Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The benchmark S&P/ASX 200 Index (ASX: XJO) is trending down today, currently 0.48% in the red at 7,141.4 points at the time of writing.

With the new year well underway, it’s time for the latest round of analyst updates to set the growth outlook for 2022. Macquarie is one of the first with a slew of broker notes coming out of the investment bank’s corner this week.

The broker came out with a list of 8 updates in notes to clients yesterday. Here’s a look at where the team at Macquarie see these ASX shares heading in 2022.

What does Macquarie reckon will outperform?

First off the press is Dexus Industria RIET (ASX: DXI) which analysts from Macquarie upgraded to outperform from neutral in a note today.

The listed fund, under the banner of real estate investment trust (REIT) and property giant Dexus (ASX: DXS), is worth $3.49 per share, according to Macquarie analyst Stuart McLean.

Dexus Industria REIT is trading 1.26% higher at $3.21 at the time of writing, indicating around 9% of upside potential should the broker’s thesis pan out.

The broker also gave Hub24 Ltd (ASX: HUB) an upward revision to outperform from a previous neutral rating. That’s in stark contrast to Macquarie analyst Brendan Carrig’s rating in September 2020 when the stock was tipped to underperform.

Macquarie has now rated Hub24 to outperform and underperform once each. Previously, it had held a neutral rating on two separate occasions. Interestingly, Bloomberg Intelligence reports that “investors who followed Carrig’s recommendation [on Hub24] received a 17% return in the past year, compared with a 3.6% return on the shares”.

Carrig reckons Hub24 is worth $32.40, an 18% upside potential from its current value of $27.44. Carrig’s price is also slightly lower than the consensus figure of $33.29.

Shares in Lendlease Group (ASX: LLC) are also set to outperform in 2022, according to another note from McLean. The analyst upgraded Lendlease from neutral today, assigning a $12.64 price target in the process.

This indicates an upside potential of approximately 21% relative to the current Lendlease share price, which is up 2.36% on the day.

What about the downgrades?

Curiously, the ASX shares the broker has tipped to remain stagnant relative to benchmarks and/or peers were healthcare names.

Macquarie downgraded Estia Health Ltd (ASX: EHE) from outperform to neutral, although its price target on the stock of $2.40 per share still indicates some potential value.

Analyst David Bailey has now rated Estia neutral and outperform once each in the last 18 months. When it was rated neutral, the stock gained 24% on average, whereas it gained 26% when rated as a buy.

At its current value of $2.09, the Estia Health share price has another 14% to climb before reaching Bailey’s price target.

Another downgrade from Bailey was to Integral Diagnostics Ltd (ASX: IDX) which was cut from outperform to neutral in a note today.

Integral is a specialist in providing diagnostic imaging services to medical and allied health professionals. It has a network of 45 sites and operates under a number of brand names.

Bailey had set the price target for Integral Diagnostics at $4.85 — below the consensus of $5.08. This implies there is around 18% upside potential from its price of $4.11 at the time of writing.

Also in the healthcare sector, Bailey has cut Regis Healthcare Ltd (ASX: RRL), Ramsay Healthcare Ltd (ASX: RHC), and Cochlear Ltd (ASX: COH), noting downside risks for each company’s share price in 2022.

Bailey valued Regis at $1.95 per share, Ramsay at $71.85, and Cochlear at $222.50, each below their consensus price targets.

With an aggressive selloff and reshuffling underway within the wider basket of ASX shares, it will be anyone’s guess as to which of these names will outperform the benchmark index this year.

The post Here are the latest broker updates from Macquarie. It’s not all pretty for ASX shares. appeared first on The Motley Fool Australia.

More reading

• Why Corporate Travel Management, Goodman, Lendlease, and Uniti shares are rising today
• Leading brokers name 3 ASX shares to buy today
• Why Adairs, Bigtincan, Regis Resources, and Telix shares are sinking
• Here’s why the Regis Resources (ASX:RRL) share price is nosediving 14% today
• These were the best performing ASX 200 shares last week

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Cochlear Ltd. and Hub24 Ltd. The Motley Fool Australia has recommended Cochlear Ltd., Hub24 Ltd, Integral Diagnostics Ltd, and Ramsay Health Care Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

It’s less than a month into 2022, and already the U.S. stock market is performing differently than in 2021 or 2020. As of market close on Jan. 19, the Vanguard Value exchange-traded fund (ETF) (NYSEMKT: VTV) was down less than 1% for the year, while the S&P 500 was down nearly 5% and the Vanguard Growth ETF (NYSEMKT: VUG) was down over 9%.

For now, at least, value stocks seem to be replacing growth stocks as the new market outperforming group. To illustrate how rare that is, consider that value outperformed growth just two out of the last 13 years. 

Let’s determine if now is a good time to rotate out of growth toward value stocks.

1. Determine what kind of investor you want to be

Jumping in and out of what’s working in the stock market over the short term is a terrible idea. The last couple of years illustrates this point perfectly.

In 2020, hypergrowth stocks, many of which are unprofitable businesses, propelled the stock market to new heights. Solar and wind stocks also crushed the market, while oil and gas stocks had one of their worst years on record (relative to the S&P 500).

The three worst-performing sectors of the S&P 500 in 2020 — energy, real estate, and financials — were the three best-performing sectors in 2021. By the same token, many Cathie Wood-style growth stocks fell over 40% in 2021. Solar and energy stocks drastically underperformed oil and gas last year.

The lesson here isn’t just that the market can be irrational over the short term — it’s also that sticking with investments that you like often works out in the end. Those that sold oil and gas stocks in 2020 to buy high-growth stocks in 2021 probably regretted it.

By determining what kind of investor you are and what kind of stocks you like to own, you stand a better chance of eliminating short-term randomness and letting valuations revert to the mean over time. As a bonus, you’ll probably be a lot more comfortable. The mental and emotional side of investing often gets overlooked when it comes to financial planning. If you’re a value investor who likes dividend stocks and you suddenly find yourself owning mostly growth stocks, you’re probably going to be anxious to sell if those stocks go up or desperate to sell if they go down.

VUG Total Return Level data by YCharts

2. Take what the market gives you

After you’ve determined what kind of investor you are and the companies you like owning, you’ll be prepared to buy into weakness and take what the market gives you. Patient investors are in luck because plenty of top-tier growth stocks are down well off their highs right now.

Similarly, value investors had plenty of opportunities throughout 2021 to snatch up shares of top dividend stocks at a steep discount to their current prices.

Most investors probably aren’t all-or-nothing when it comes to value, income, or growth. Rather, they probably have a preference but still like some sort of blend of different types of investments.

Timing the market isn’t a good idea, but being flexible is. For example, if you missed out on Bitcoin and Ethereum, now is your chance to buy at a better price. If you’ve been waiting to buy electric vehicle stocks, there are some good buys in that space too.

Keeping some dry powder on the sidelines provides the extra ammo needed to take advantage of dips in great companies.

3. Invest in companies you understand and want to own

One of the worst mistakes I’ve made as an investor is allocating too high of a percentage of my portfolio toward companies that I don’t understand. Peter Lynch, my favorite investor of all time, often joked that people spend so much time dissecting the pros and cons of major purchases like a car or where they are going to live, but are so quick to throw money into a hot investment idea with little underlying knowledge about what they are buying. 

Whether we like it or now, fear of missing out (FOMO) is a strong emotion that can inhibit clear thinking and lead to chasing the next hottest growth stock. That’s no problem if the stock goes up. But if it falls, let’s say by over 50% as many of the hottest stocks in the Nasdaq-100 have done over the past year, then it’s harder to know when the bleeding will stop or have the conviction to hold the stock if you don’t understand it.

Be wary of a temperamental market

It seems bizarre that many of 2020’s hottest industries and companies would turn on a dime and become 2021’s biggest losers. On top of that, you could argue that the market went up too far too fast in 2021, given interest rate and inflation risks. The Fed’s decision to raise rates wasn’t surprising. You would think that an efficient and forward-looking stock market wouldn’t be so quick to drive prices down on predictable news. But so far this year, it has. 

No one knows what the market will do in the short term or how long one trend will last. Instead of banking on value stocks beating growth stocks in 2022, it’s best to stick to positions you like and want to hold for several years, thereby limiting the randomness market fluctuations can inflict on your portfolio. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Should you buy value stocks and sell growth stocks in 2022? appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• This trend could double already red-hot lithium demand
• Why the Thorn Group (ASX:TGA) share price is plummeting 22% today
• Why is the Telix Pharmaceuticals (ASX:TLX) share price plummeting 13% today?
• Why are these beaten-up small cap ASX tech shares seeing 52-week lows today?

Daniel Foelber owns Bitcoin and Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and recommends Bitcoin, Ethereum, Vanguard Growth ETF, and Vanguard Value ETF. The Motley Fool Australia owns and recommends Bitcoin and Ethereum. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Once a week I like to look at ASIC’s short position report to find out which shares are being targeted by short sellers.

This is because I believe it is well worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn’t quite right with a company.

With that in mind, here are the 10 most shorted shares on the ASX this week according to ASIC:

• Flight Centre Travel Group Ltd (ASX: FLT) remains the most shorted ASX share after its short interest increased to 14.8%. Concerns over the impact of the Omicron variant on the travel market appears to be behind this high level of short interest.
• Kogan.com Ltd (ASX: KGN) has seen its short interest rise to 12.2%. Short sellers appear to have been increasing their positions since the release of a couple of disappointing industry updates. These appear to have supported the view that Kogan is struggling in FY 2022.
• Zip Co Ltd (ASX: Z1P) has seen its short interest rise to 10.3%. Zip’s shares came under pressure last week after its second quarter update revealed slowing momentum in the US market.
• BHP Group Ltd (ASX: BHP) has short interest of 9.8%, which is up week on week once again. Traders are shorting BHP’s shares in order to profit from the unwinding of its dual listing. The idea is that they short BHP’s ASX shares and buy the cheaper UK shares that will eventually be repatriated.
• Redbubble Ltd (ASX: RBL) has short interest of 9.8%, which is up week on week again. Short sellers will have been very pleased to have seen this ecommerce company’s shares tumble last week following a disappointing trading update.
• Mesoblast limited (ASX: MSB) has short interest of 9.5%, which is up week on week. Short sellers continue to increase their holdings following the termination of an agreement with Novartis that would have been worth up to US$1.25 billion.
• Webjet Limited (ASX: WEB) has short interest of 8.9%, which is up week on week. This appears to have been driven by ongoing concerns that the Omicron variant will push back the travel market recovery.
• Polynovo Ltd (ASX: PNV) has seen its short interest ease to 7.8%. Short sellers will have been pleased to see this this medical device company’s shares crash last week amid the market volatility. This meant the PolyNovo share price gave back its gains from a week earlier following a trading update.
• Appen Ltd (ASX: APX) has seen its short interest rise to 7.4%. This artificial intelligence data services provider has been tipped to surprise to the upside with its full year results next month. However, short sellers don’t appear to be getting nervous ahead of its results and have increased their holdings.
• Nanosonics Ltd (ASX: NAN) has entered the top ten with 7.2% of its shares held short. This may be due to its slow progress with the launch of new products and the lofty multiples that its shares trade on.

The post These are the 10 most shorted ASX shares appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Appen Ltd, Kogan.com ltd, Nanosonics Limited, POLYNOVO FPO, and ZIPCOLTD FPO. The Motley Fool Australia owns and has recommended Appen Ltd, Kogan.com ltd, and Nanosonics Limited. The Motley Fool Australia has recommended Flight Centre Travel Group Limited and Webjet Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Key points

• Demand for lithium may be twice what the market is expecting if swappable batteries became an industry standard, according to Macquarie
• The potential trend is likely to put even more upward pressure on lithium prices, which are testing new highs this month
• ASX lithium shares at the top of Macquarie’s buy list are the Pilbara Minerals share price and the Mineral Resources share price

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Booming demand for lithium could be twice as bad as experts are predicting if an emerging trend takes hold, according to a top broker.

Some electric vehicle (EV) industry insiders are betting on swappable batteries. If this is because of the industry standard, it could put upward pressure on lithium prices, according to Macquarie.

Swappable batteries for EV could be a major trend

Swappable vehicle batteries are seen as an ideal way to overcome “range anxiety”. Instead of recharging, drivers can just exchange their batteries for a fully charged one.

The other advantage is that swappable batteries could lower the cost of purchasing an EV. This is because EVs may be bought without a battery and drivers could subscribe to a battery swapping service.

If the concept takes off, it would be great news for ASX lithium shares, according to Macquarie.

How swappable batteries can trigger demand shock

“Macquarie EV, battery materials, basic materials team recently had a deep dive into battery swapping and believed battery swapping could double battery demand esp. for ternary batteries, benefiting upstream battery materials, esp. cathodes, separators, lithium,” said the broker.

Even as things stand now, lithium product prices in China have already reached new records in the first half of January.

Lithium prices reaching new highs

“Chinese spot technical and battery grade lithium carbonate prices (non-VAT adjusted) reaching new highs of Rmb342,500/t (~US$54,000/t) and Rmb358,500/t (~US$56,500/t), respectively,” said Macquarie.

“Realised spodumene prices also increased further and broke US$2,690/t mid this week. Platts Battery Metals reported on 21st Jan that spot spodumene concentrate (6% Li2O) sales were being quoted around US$3,000/t (FOB, Australia), a new all-time high.”

ASX lithium shares to buy

The adoption of swappable batteries will make the imbalance worse, although the crash in ASX lithium shares today is contradicting the strong outlook.

The Liontown Resources Limited (ASX: LTR) share price slumped 7.1%, Allkem Ltd (ASX: AKE) share price tanked 5%, and Pilbara Minerals Ltd (ASX: PLS) share price shed 2% at the time of writing.

But this could be a buying opportunity as Macquarie rates most of the ASX lithium shares as “outperform”.

The broker’s favourite picks are the Pilbara share price and the Mineral Resources Limited (ASX: MIN) share price.

The post This trend could double already red-hot lithium demand appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• Why the Thorn Group (ASX:TGA) share price is plummeting 22% today
• Why is the Telix Pharmaceuticals (ASX:TLX) share price plummeting 13% today?
• Why are these beaten-up small cap ASX tech shares seeing 52-week lows today?
• The Nasdaq is in correction territory. Is the ASX 200 next?

Motley Fool contributor Brendon Lau owns Orocobre Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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