Author: therawinformant

The Afterpay Ltd (ASX: APT) share price is falling again today, down 1.72% in early afternoon trading.

The Australian buy now, pay later (BNPL) star saw its share price peak on 25 August at $92.48 per share. That represented an astonishing 939% gain from its 23 March lows and a 202% year-to-date gain.

Although Afterpay’s share price is now down 22% from its 25 August all-time highs, investors who bought shares on 2 January are still sitting on a healthy 135% gain.

Afterpay is part of the S&P/ASX 200 Index (ASX: XJO). By comparison the ASX 200 is down 12% since 2 January.

What does Afterpay do?

Afterpay is an Australian incorporated technology company and a leader in the BNPL market. Afterpay’s payment platform allows consumers to purchase and receive goods and spread the cost of their purchase out over equal payments, without any interest fees.

The company was founded in 2015. Afterpay shares first began trading on the ASX in June 2017. These days, the company operates in Australia, the United States and the United Kingdom, with current expansion plans into the wider European market.

Why is the Afterpay share price falling?

The Afterpay share price is being hit from several sides.

First, technology shares as a whole have come under pressure following a tremendous run higher after the COVID-19 market rout in March.

In the United States the NASDAQ-100 Index (NASDAQ: NDX) – containing the biggest 100 tech-oriented shares – is down 11% since last Wednesday, 2 September. The Apple Inc. (NASDAQ: AAPL) share price is down 16% from 1 September and the Tesla Inc (NASDAQ: TSLA) share price is down 34% from 31 August.

Atop the wider selloff in tech shares, Afterpay is also seeing an increasing potential for competitors to steal some of its market share.

On 1 September, industry giant PayPal rattled Afterpay investors when it announced it will be launching its own BNPL platform in the US, called pay-in-4.

And it’s not just PayPal. Commonwealth Bank of Australia (ASX: CBA) also want a piece of the ‘pay in interest free installments’ action. Earlier this year, Commonwealth invested $411 million in Klarna, a Swedish based BNPL competitor.

Topping it off, all the BNPL players in Australia – of which Afterpay is by far the largest – are facing increasing government scrutiny as legislators debate whether they should be subject to responsible lending regulations.

This might see some of the smaller ASX BNPL shares squeezed out of the market or subject to takeover. But with a market cap of $21 billion, Afterpay is likely here for the long haul. And while its share price is falling today, longer-term this is a company to keep your eye on.

More reading

• ‘We could be heading for a lot of pain’
• Why Accent, Afterpay, Nine, & PointsBet shares are dropping lower today
• Tech share prices are down but not out. When should you buy?
• ASX 200 down 2.4%: Afterpay (ASX:APT) and Oil Search (ASX:OSH) sinking lower
• Gold Road (ASX:GOR) share price runs lower on HY20 results

Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Apple and Tesla. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Apple. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Qantas Airways Limited (ASX: QAN) share price has come under pressure on Wednesday.

In early afternoon trade the airline operator’s shares are down a sizeable 5.5% to $3.86.

Why is the Qantas share price tumbling lower?

Qantas shares have dropped lower today following a broad market selloff after a disappointing night on Wall Street.

In addition to this, also weighing on the company’s shares could be news that AstraZeneca has paused its late-stage trial for a potential coronavirus vaccine due to safety concerns.

There are high hopes for its promising AZD1222 vaccine, which is being developed with Oxford University.

In fact, earlier this week CSL Limited (ASX: CSL) signed an agreement with AstraZeneca for the expected manufacture of approximately 30 million doses of the vaccine candidate for supply to Australia.

Given that tourism markets are unlikely to return to normal until the successful development of a vaccine, its failure would be a bitter blow for the industry.

However, it is worth noting that this trial pause isn’t unusual.

In a statement to CNBC, AstraZeneca said: “This is a routine action which has to happen whenever there is a potentially unexplained illness in one of the trials, while it is investigated, ensuring we maintain the integrity of the trials.”

The biotech giant intends to speed up the investigation in order to “minimize any potential impact on the trial timeline.”

Should you buy the dip?

Although I do see value in Qantas’ shares, given the uncertainty in global travel markets, I’m not in a rush to invest just yet.

Two brokers that are more positive are Macquarie Group Ltd (ASX: MQG) and Morgan Stanley.

Late last month Macquarie’s analysts put an outperform rating and $4.25 price target on Qantas’ shares. Morgan Stanley thinks its shares can go higher and has an overweight rating and $4.90 price target on them.

More reading

• Top brokers name 3 ASX shares to buy today
• Top ASX shares to buy this week
• Here’s why some ASX dividend shares just go nowhere
• Half of ASX 200 stocks at risk as China-Australia relations hit new low
• 3 ASX 200 shares to buy with $3,000 this week

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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There are over 2,000 companies listed on the ASX right now. As such, deciding on which are the best to buy can be challenging. Following are three ASX shares that I think would make great buys right now. These companies are either growing well or are showing promise. Furthermore, all of them have a market capitalisation above $300 million meaning they should be a little more stable than their small and micro cap friends.

My top ASX shares to buy this week

Serko Ltd (ASX: SKO)

About Serko

Serko is a software-as-a-service (Saas) company in the travel and expense management space. It provides powerful online solutions to customers in more than 35 countries. Serko is listed on both the Australian and New Zealand stock exchanges. 

Serko share price

The Serko share price took a massive hit during the first wave of coronavirus. This was not surprising considering its key market and customer base. Most companies had to all but stop corporate travel in March this year. Serko didn’t get off easy with the company’s share price practically falling off a cliff. However in late March, we saw very much a ‘V-shaped recovery’ in the Serko share price.

Serko fell from heights of $5.50 right down to 90 cents in a matter of 60 days. The good news for investors is that since the March lows, Serko has managed to claw its way back up to a price of $3.86 at the time of writing. It’s certainly on the up and up. One thing I really like is that the Serko share price has struggled to get past $3.70 since June, however this week it’s finally broken through. I hope this is a positive breakout and it continues up. The Serko share price is up more than 4% this week.

Why I like Serko

While Victoria seems destined for indefinite lockdowns, the rest of the country is half way back to a normal existence. Serko’s services extend internationally and most countries are also working hard on getting their economies back to normal. With news of a vaccine as soon as January 2021 on the rise, Serko is in prime position to capitalise on a returning corporate travel market. This is absolutely one of my top ASX shares to buy this week.

CSL Limited (ASX: CSL)

About CSL

CSL researches, develops, manufactures, markets and distributes bio pharmaceutical products. Its market base is huge, with products being distributed to major countries such as Australia, the United Kingdom, Germany, the United States, Switzerland, China and many others. 

CSL share price

The CSL share price has been floating between about $270 and $300 for the last couple of months. CSL took an initial hit in the March crash, but recovered almost instantly. Still, it’s down to around $280 today from its previous heights of $340, meaning that it’s trading at approximately a 17.6% discount. I think the current CSL share price is great value considering the scope of the company and its future prospects.

Why I like CSL

CSL has over 100 years experience in its field. It’s a major player and isn’t going anywhere anytime soon. It also has a string of achievements to its name in the medical space.

One of the main reasons CSL is on my watch list is because of its potential to be involved in the production of a coronavirus vaccine. CSL is in prime position to produce millions of doses of a potential vaccine. The federal government recently announced it would commit up to $1.7 billion towards Australia’s vaccine production.

With such a huge history of success, I believe CSL will be heavily involved in the fight against the pandemic. This is a company that was already strong and, in my view, this latest development only makes it stronger.

Xero Limited (ASX: XRO)

About Xero

Xero is a SaaS company offering cloud-based software spanning a huge number of areas to business owners. Xero’s platform encompasses tax, cash flow, workflow, invoicing, expense management and many other aspects of business operations. Xero has over 2 million active subscribers. Even more impressive is the fact that it added almost 100,000 new customers last quarter. Xero services multiple industries including eCommerce, hospitality, construction, healthcare, farming, manufacturing and many others.

Xero share price

The Xero share price has taken a dip recently, presenting a buying opportunity. Down almost 8% since the start of September, I think this company is great value. Xero has shown incredible strength since the March crash, not only recovering lost ground, but exceeding previous highs. 

Why I like Xero

Xero helps businesses operate more efficiently. It also helps business owners run their companies from any location. This is critical in a rapidly changing business landscape. Considering the current state of the world, the work from home revolution and the huge number of new small businesses being launched, Xero is in a prime position to benefit. It is one of my top ASX shares to buy this week.

Foolish takeaway

I like to look for companies that make sense to buy in the current climate. Although we’re not over coronavirus, we are certainly making progress towards an economic recovery, which is why I’m pro travel and health. We are also becoming an online world more than ever before. I believe the companies that capitalise on these trends are the ones that will ultimately win. 

More reading

• Is the Xero (ASX:XRO) share price a cheap buy?
• Here’s why some ASX dividend shares just go nowhere
• 3 high quality ASX shares for smart investors to buy today
• 3 ASX high-growth ETFs growth investors can’t ignore
• 3 ASX 200 shares to buy with $3,000 this week

glennleese has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd., Serko Ltd, and Xero. The Motley Fool Australia has recommended Serko Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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In early afternoon trade the S&P/ASX 200 Index (ASX: XJO) is on course to record a disappointing decline. At the time of writing the benchmark index is down 2.4% to 5,864.7 points.

Four shares that have fallen more than most today are listed below. Here’s why they are dropping lower:

The Accent Group Ltd (ASX: AX1) share price has dropped 4% to $1.49. As well as being caught up in the market selloff, Accent’s shares have come under pressure after trading ex-dividend this morning. Eligible shareholders of the footwear retailer can now look forward to receiving its fully franked 4 cents per share final dividend later this month on 24 September.

The Afterpay Ltd (ASX: APT) share price is down 3.5% to $72.33. Investors have been selling the payments company’s shares following another selloff on the Nasdaq index overnight. The technology-focused index fell 4.1% amid further profit taking from investors. This latest decline means the Afterpay share price is now down almost 25% from its 52-week high. Afterpay isn’t the only tech share dropping lower. The S&P/ASX All Technology Index (ASX: XTX) is down 3.1% at the time of writing.

The Nine Entertainment Co Holdings Ltd (ASX: NEC) share price has dropped 4% to $1.62. As with Accent, some of this decline is attributable to the media company’s shares going ex-dividend this morning. Eligible Nine shareholders will be paid the company’s fully franked final 2 cents per share dividend in around six weeks on 20 October.

The PointsBet Holdings Ltd (ASX: PBH) share price has crashed 16.5% lower to $11.42. This follows the successful completion of the institutional component of its fully underwritten entitlement offer. According to the release, the institutional entitlement offer closed on Tuesday and raised gross proceeds of approximately $70.5 million. The company will now push ahead with its retail entitlement offer. In total PointsBet is aiming to raise $353 million to support its U.S. expansion.

More reading

• Tech share prices are down but not out. When should you buy?
• ASX 200 down 2.4%: Afterpay (ASX:APT) and Oil Search (ASX:OSH) sinking lower
• Why the PointsBet (ASX:PBH) share price tumbled 21% lower today
• The Zip (ASX:Z1P) share price is down 30% since August: is it a buy? 
• 3 ASX tech shares to buy for the long term after the Nasdaq selloff

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Pointsbet Holdings Ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Accent Group, Nine Entertainment Co. Holdings Limited, and Pointsbet Holdings Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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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.

According to an article in Stat, AstraZeneca (NYSE: AZN) has paused the U.S. clinical trial of its coronavirus vaccine, AZD1222, after a serious possible adverse event arose in a patient enrolled in a clinical trial testing AZD122 in the U.K.

At this point, the nature of the adverse event is not known, and it isn’t clear whether it was caused by AZD122. The company is “working to expedite the review of the single event to minimize any potential impact on the trial timeline,” according to Stat. The participant is expected to recover. 

In addition to the 30,000-participant U.S. study announced last week, AstraZeneca is also running clinical trials in the U.K., Brazil, and South Africa. The company plans to start studies in Japan and Russia as well. All told, the studies will enroll up to 50,000 participants globally.

It isn’t publicly known exactly how many patients have received AZD1222, but investors can get some clues from Moderna (NASDAQ: MRNA), which had enrolled 21,411 participants in its late-stage coronavirus vaccine clinical trial as of Friday. Meanwhile, vaccine collaborators Pfizer (NYSE: PFE) and BioNTech (NASDAQ: BNTX) had enrolled 25,189 participants as of an update on Monday.

With that many people enrolled in coronavirus clinical trials, it’s highly likely that one of the participants would develop a serious illness unrelated to the vaccination. Of course, proving that it’s unrelated could be challenging and might only be possible by testing AZD122 on more participants. If the adverse event only occurs in one out of 50,000 participants, it’s either unrelated or a side effect with such a low incidence level that it’s a tolerable issue.

Shares of AstraZeneca were down 6.5% at 6:40 p.m. EDT in after-hours trading.

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

More reading

• How to invest in coronavirus vaccine stocks
• In the race for a coronavirus vaccine, can there be multiple winners?

Brian Orelli, PhD has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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

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It was bound to happen sooner or later.

Like Icarus flying too high too fast only to have the sun melt the wax holding his wings together, the share market correction we’re witnessing right now was inevitable.

Only the timing was in doubt. And we’re happy to leave trying to time the share market highs and lows to those with a penchant for gambling and far deeper pockets than ours.

Unlike Icarus, though, global share markets aren’t in a death spiral. The wings – if we can stretch the analogy – are still firmly in place.

Namely: record low interest rates for the foreseeable future; trillions of dollars in new fiscal stimulus projects in the pipeline across the developed world; plenty more quantitative easing (QE) ahead from the central banks; cashed up retail and institutional investors still waiting on the sidelines (Warren Buffett’s Berkshire Hathaway alone was sitting on some US$150 billion (AU$208 billion) in cash at the end of June). And let’s not forget the host of quality listed companies creating real world value with their businesses.

Nonetheless, the blistering pace of the technology led share market rebound since March 23 was due for a pullback.

The share price retrace we had to have

The NASDAQ-100 Index (NASDAQ: NDX) – containing the biggest 100 tech-oriented shares of the broader Nasdaq Composite Index (NASDAQ: .IXIC) – gained 77% from 23 March through to its all-time highs last Wednesday, 2 September.

Following yesterday’s (overnight Aussie time) 4.8% loss, the Nasdaq-100 is now down almost 11% since that high. Some of the index’s biggest companies, the same ones who helped drive the 77% gains in less than 6 months, are now pulling it lower.

The Apple Inc. (NASDAQ: AAPL) share price fell 6.7% yesterday. It’s now 16% below its record highs from last Tuesday, 1 September. That’s seen its market cap drop below the much touted US$2 trillion mark.

The Tesla Inc (NASDAQ: TSLA) share price has fared even worse, shedding a gut-wrenching 21% yesterday. Its now down 34% from it 31 August all-time highs.

It’s a similar story here in Australia 

The S&P/ASX All Technology Index (ASX: XTX) tracks 50 of Australia’s leading and emerging technology shares. On 25 August, XTX had gained a whopping 116% from the 23 March low. Since that high it’s down 10%.

Like the Nasdaq 100, XTX is being pulled lower by some of the same big names that drove it higher.

Buy now, pay later star Afterpay Ltd‘s (ASX: APT) share price rocketed an astounding 939% from 23 March through 25 August. Since then the share price is down 23%.

But Afterpay has nothing on its smaller rival Sezzle Inc (ASX: SZL). Sezzle’s share price gained 2,965% from 23 March through its record high on 28 August. Since then the share price is down 40%.

Now let’s put these daunting losses into some perspective.

Putting the correction in perspective

Investors who piled into shares, particularly tech shares, over the past 2 weeks will certainly be feeling the burn.

Which is a handy reminder of why we Fools recommend dollar cost-averaging (DCA), and not investing all your funds in one go. This helps you to diversify your investment funds across time as well as across a broader basket of shares, cash, bonds and perhaps an allocation to precious metals.

But getting back to perspective, it’s important to take a step back to see the bigger picture, which gives us a good indication of how things may unfold in the longer-term going forward.

So here’s the bigger picture, sticking with the 4 shares we’ve highlighted today.

Year-to-date Sezzle’s share price is up 315%, Afterpay’s share price is up 137%, Tesla’s share price is up 284% and Apple’s share price is up 50%. And that’s from 2 January, mind you, not the 23 March lows following the COVID-19 market rout.

With that said, is today a good day to buy these and other tech shares that are currently still falling? Probably not. But that time is coming again, likely quite soon. And when it does you won’t want to miss out on the next big share price booms.

What the market veterans are saying about the current selloff

Tom Essaye, is a former Merrill Lynch trader and founder of The Sevens Report newsletter. He sounds a note of caution for the short term (as quoted by Bloomberg):

Some froth has come off the market which is a good thing, but keep in mind that we still remain well over levels that could be considered ‘fair value’ in stocks. And while the outlook for stocks remains generally constructive long term, there’s a lot more downside in this market if we get any major disappointments.

Peter Chatwell, head of multi-asset strategy at Mizuho International Plc. adds, “The path of least resistance for the market may well be to test the downside. Ultimately, if there is more selloff, I suspect real money investors will take the opportunity to buy the dip.”

More reading

• Why Accent, Afterpay, Nine, & PointsBet shares are dropping lower today
• ASX 200 down 2.4%: Afterpay (ASX:APT) and Oil Search (ASX:OSH) sinking lower
• Why the Tesla (NASDAQ:TSLA) share price just crashed 21% lower
• The Zip (ASX:Z1P) share price is down 30% since August: is it a buy? 
• 3 ASX tech shares to buy for the long term after the Nasdaq selloff

Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Apple and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Sezzle Inc. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Apple and Sezzle Inc. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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At lunch on Wednesday the S&P/ASX 200 Index (ASX: XJO) has given back all of yesterday’s gains and more. The benchmark index is currently down a disappointing 2.4% to 5,865.3 points.

Here’s what has been happening on the market today:

Tech shares crash lower.

It has been a difficult day of trade for Australian tech shares such as Afterpay Ltd (ASX: APT) and Appen Ltd (ASX: APX). These two tech stars are down over 4% at the time of writing following another selloff on the tech-heavy Nasdaq index overnight. The Nasdaq crashed 4.1% lower amid further profit taking from investors. The S&P/ASX All Technology Index (ASX: XTX) is down 3.3% at lunch.

Energy shares tumble.

It has been an equally difficult day for energy producers such as Oil Search Limited (ASX: OSH) and Santos Ltd (ASX: STO). Investors have been selling their shares after oil prices crashed lower overnight on demand concerns. According to Bloomberg, the WTI crude oil price sank 7.3% lower to US$36.88 a barrel and the Brent crude oil price dropped 5% to US$39.87 a barrel.

Gold Road half year results.

The Gold Road Resources Ltd (ASX: GOR) share price is dropping lower following the release of its half year results. For the six-month period ending 30 June, Gold Road produced 131,460 ounces of gold at an all-in sustaining cost of $1,186 per ounce. This ultimately led to the gold miner delivering earnings before interest, tax, depreciation and amortisation (EBITDA) of $61 million. Which compares favourably to a $23 million loss a year earlier.

Best and worst ASX 200 shares.

The best performer on the ASX 200 on Wednesday has been the Nufarm Limited (ASX: NUF) share price with a 3% gain. This follows a broker upgrade by Morgans earlier this week. The worst performer has been the Megaport Ltd (ASX: MP1) share price with a 7% decline. Its shares have been caught up in the tech selloff today.

More reading

• Why Accent, Afterpay, Nine, & PointsBet shares are dropping lower today
• Tech share prices are down but not out. When should you buy?
• Why BrainChip, Codan, IPH, & Nufarm shares are climbing higher today
• Gold Road (ASX:GOR) share price runs lower on HY20 results
• The Zip (ASX:Z1P) share price is down 30% since August: is it a buy? 

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends MEGAPORT FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO and Appen Ltd. The Motley Fool Australia has recommended MEGAPORT FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Today Brainchip Holdings Ltd (ASX: BRN) shares are up 15.07% at the time of writing to 84 cents. At one stage in early trade, the Brainchip share price had jumped more than 30% to 97 cents before a pullback. The rally came after the company’s share price soared 30.36% yesterday. 

The movement in the Brainchip share price yesterday prompted an ASX query or ‘speeding ticket’ requesting if any information that had not yet been announced to the market could be affecting the share price.

How did Brainchip respond to the ASX query?

Brainchip Holdings stated that its was not aware of any information that had not yet been announced to the market that could be affecting its share price. It stated “BRN is not aware of any matter that would have effected the recent trading in its securities”.

Why is the Brainchip share price soaring?

As we speculated in an article yesterday, it is possible that the Brainchip share price is moving as a result of good news the company released last week. This included a partnership with an American technology company, VORAGO, to supply NASA with its product. Additionally, Brainchip was added to the S&P ASX All Technology Index (ASX: XTX) last week.

It is also possible that more buyers are newly becoming aware of Brainchip’s offering and would like to add it to their portfolios. It is a unique company, offering computer chips that work in a way similiar to the human brain, so it may be seen by investors to have potential, which has been reflected in its recent deal.

Additionally, it is conceivable that there is information Brainchip does not yet know which could be affecting the share price. For example, there could be another entity buying up shares that has not yet reported it to the market. Buyers could also be speculating that Brainchip may have future value as an acquisition target.

What does Brainchip do?

Brainchip has developed a processing technology named Akida. According to the company, this technology works in a way that mimics the human brain. It can learn new information through experiences without needing to undergo complete retraining and can process data without needing to send it to a data centre for processing. Additionally, the technology has applications for processing visual data, audio data, smell and movement.

About the Brainchip share price

The Brainchip share price is up 2,700% since its 52-week low of 3 cents and 1580% since the beginning of the year. The company’s shares are up 2000% since this time last year.

More reading

• Why BrainChip, Codan, IPH, & Nufarm shares are climbing higher today
• Why BrainChip (ASX:BRN) and Recce (ASX:RCE) shares just hit record highs
• Why the Brainchip (ASX:BRN) share price soared 30% today
• Afterpay and Brainchip were among the most traded shares on the ASX last week
• ASX All Technology Index swells with new additions

Motley Fool contributor Chris Chitty has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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In late morning trade the S&P/ASX 200 Index (ASX: XJO) has followed the lead of U.S. markets and is sinking lower. At the time of writing the benchmark index is down 2% to 5,885.8 points.

Four shares that have defied the selloff and pushed higher are listed below. Here’s why they are climbing higher today:

The BrainChip Holdings Ltd (ASX: BRN) share price is up 14% to 83 cents. Investors continue to buy the artificial intelligence technology company’s shares after it announced a collaboration with VORAGO Technologies at the start of the month. This collaboration  intends to support a Phase 1 NASA program for a neuromorphic processor that meets spaceflight requirements. Today’s gain means BrainChip now has a market capitalisation of over $1.25 billion. Given its limited cash balance, I suspect the company may take advantage of its remarkable share price rise with a capital raising in the near future.

The Codan Limited (ASX: CDA) share price is up 1% to $10.98 after announcing a major new contract win. This contract is with a large African government to supply tactical communications equipment. Management advised that the contract has a value in the order of US$10 million and includes the supply of Sentry-HTM radios and accessories. It expects this order to be delivered in the second half of FY 2021.

The IPH Ltd (ASX: IPH) share price has climbed over 2% to $6.80. This is despite there being no news out of the intellectual property services company. However, late last month analysts at Goldman Sachs slapped a buy rating and $8.90 price target on the company’s shares. Some investors may believe it is a bargain buy and one to snap up during the volatility.

The Nufarm Limited (ASX: NUF) share price is up 3% to $4.25. This is the second day in a row of solid gains for the agricultural chemicals company. The catalyst for this appears to be a broker note out of Morgans this week. Its analysts upgraded Nufarm’s shares to an add rating with an improved price target of $4.85. While it expects a soft FY 2020 result later this month, its analysts suspect that this could be the bottom of the cycle.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Why BrainChip, Codan, IPH, & Nufarm shares are climbing higher today appeared first on Motley Fool Australia.

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Did you see the news?

Apparently Tom Waterhouse – yes, that Tom Waterhouse – has gone from bookie, to racing tipster and now wants to start a funds management business.

Cue much guffawing.

What does Tom Waterhouse know about stocks?

How could he possibly be a fund manager?

Hahahaha!

And yet…

I’m no fan of bookies.

Or racing tipsters.

Gambing on horse races is a zero-sum game.

If I win, you lose.

Actually, it’s worse than that.

If I win, you lose more, because the house takes its cut, too.

And unfortunately, there are more than a few people addicted to the punt, and for whom gambling is the cause of much unhappiness, poverty and breakdown.

And yet…

The simplistic ‘What would an ex-bookie know about stocks’ is, well, simplistic.

I have no idea what Tom Waterhouse knows – or doesn’t know – about investing.

Maybe he’s just looking to parlay his name recognition into a new field.

Maybe he’ll be terrible at it.

Maybe he’ll employ others to do the hard work.

Or maybe he’ll be great.

Time will tell (and, based on what he was quoted as saying in The Australian yesterday, he’s going to give himself time to earn a track record before putting out his shingle, so he should get credit for that).

Now, here’s what’s supposed to come next.

As someone in the investment community, I’m supposed to point out the difference between investing and gambling.

I’m supposed to say ‘gambling’ with a sneer, clearly letting you know that as an investor, I’m superior in almost every way.

See, I’m not one of them. I’m one of the good guys.

But man, there are few things I dislike more than arrogance and smug superiority.

Especially when it’s not warranted!

Let me introduce you to one of the best investors in the last half-century.

His name is Charlie Munger, and he’s Warren Buffett’s right hand man.

Not only is he a billionaire and a polymath, he’s about as close as it gets to investing royalty.

Tell ’em what you said, Charlie:

“We look for a horse with one chance in two of winning and which pays you three to one. You’re looking for a mispriced gamble. That’s what investing is.”

Well, that’s inconvenient for the ‘investing isn’t gambling’ crowd, huh?

To be clear, though, what those sneering investors are doing is playing on our preconceptions of those words.

If someone says “taking a gamble”, we assume they mean “doing something that probably won’t work”.

When they say “that’s gambling”, they mean “good luck, loser!”

And maybe that’s fair enough.

To be sure, the outcomes from – and let’s put those terms aside for a minute – buying and holding shares in quality companies are likely to be better than trying to earn a positive return from a horse race where the outcome is less than zero-sum, after allowing for the house’s take.

Or, put more simply: History suggests that owning shares is more profitable than playing roulette, blackjack or trying to pick a winner in the 6th at Moonee Valley.

So, yes, I’d rather people invest in shares than get on the punt.

But that’s not to say they’re mutually exclusive pastimes.

Indeed, as Munger points out, both are an exercise in probability.

More specifically, in risk and return.

That ‘sure thing’ that got beaten on the weekend? It’s the equivalent of the ‘can’t lose’ blue chip stock your broker recommended that, well, lost.

The rank outsider that paid 30-to-1? Meet Afterpay, whose shares went up 10-fold after the market lows of late March, and that were up 30-fold in three short years.

And yes, the 100-to-1 long shot shares more than a little in common with that biotech hopeful or luckless gold explorer that never seems to deliver.

But good investing shares a lot in common with professional gambling.

Both require a thorough understanding and assessment of the odds: the risk and potential return.

Both require a diversified portfolio – of companies or bets – in the full knowledge that some of them will go badly.

Frankly, the professional gambler is more an investor than the novice day-trader who believes they can beat the market.

The professional gambler is more an investor than the bloke who buys stuff because their mate suggested it, because it’s going up, or because everyone is talking about it on some free internet forum.

I hope that makes you uncomfortable. Not because I’m telling you that you’re wrong, per se, but because I hope it leads you to reassess how you invest.

The aim of investing isn’t to find ‘sure things’.

No, not because that’d be bad, but rather because it isn’t possible.

There are no ‘sure things’ – in investing or anywhere else (setting aside death and taxes, that is!).

But rather because the investor’s job is to try to get a handle on the risk they’re taking, as well as the return they’re being offered.

If you were offered a 1% return, you’d better hope the investment is about as risk free as they come!

If you were offered 80%, you should assume there is a very, very high chance of doing your dough.

But if you were offered, as Charlie Munger suggests, a 50% chance of a 3-to-1 payout, you should take it.

But first, remember that a horse with a one-in-two chance of winning will actually lose half the time! 

Munger would be the first to say you shouldn’t put all of your eggs in that one basket.

What he didn’t say – but those who know Munger’s work would safely suggest he meant – was that he wouldn’t want just one horse, nor a single bet. 

Munger would want a heap of those mispriced bets. Because he knows that as long as he’s calculated the odds successfully, the average return from a collection of similar bets will be very, very good.

I have no idea whether or not Tom Waterhouse will be a good investor.

But what I expect is that years of working as a bookie, and being part of a racing family, should have endowed him with a very good understanding of risk and return.

There are worse ways to learn something that many ‘investors’ take many years to learn, or never learn at all.

Fool on.

More reading

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• Gold Road (ASX:GOR) share price runs lower on HY20 results
• Why the PointsBet (ASX:PBH) share price tumbled 21% lower today
• No savings at 50? I think these tips can help you retire early with stocks
• 3 small cap ASX growth shares I’d buy with $1,000

Motley Fool contributor Scott Phillips has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post What are the odds that Tom Waterhouse makes a great investor? appeared first on Motley Fool Australia.

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