A message from our CIO, Scott Phillips:

“G’day Fools. If you’re like us, you’re dismayed by the events taking place in Ukraine. It is an unnecessary humanitarian tragedy. Times like these remind us that money is important, but other things are far more valuable. And yet the financial markets remain open, shares are trading, and our readers and members are looking to us for guidance. So, we’ll do our best to continue to serve you, while also hoping for a swift and peaceful end to war in Ukraine.” 

——-

The Woodside Petroleum Limited (ASX: WPL) share price is falling today after oil prices crashed overnight.

Global oil prices nosedived after the United Arab Emirates (UAE) expressed support for increasing output into the market.

A report on CNN said the UAE intended to encourage the Organization of the Petroleum Exporting Countries (OPEC) to ramp up supply.

As a result, the Brent crude oil price fell 13.16% to US$111.14 a barrel, according to Bloomberg. The drop was the ‘worst one-day decline since 21 April 2020’, a report on NAB trade stated.

Woodside shares are currently trading at $31.75, a 4.3% fall. For perspective, the S&P/ASX 200 Index (ASX: XJO) is up 1% today.

Meanwhile, Woodside CEO Meg O’Neill has shared her insights into the global energy market.

Like the 1970s oil crisis, says Woodside boss

O’Neill says the shift in global energy dynamics due to the Ukraine war felt like a change “that will be with us for decades”.

Speaking at yesterday’s Australian Financial Review Business Summit in Sydney, O’Neill added:

Maybe the analogy is the 1970s oil crisis, which was a real wake-up call for the world that being highly dependent on energy from one particular nation, whose values may not be well aligned with yours, was a huge risk.

And so I think the world is going to have some real sober reflection on the pathway to diversify energy supply, and will look to countries like the US and like Australia, to see how they can support like-minded countries in providing their energy.

The NAB trade report said the US is in discussions about relaxing oil sanctions on Venezuela. This would be conditional on Venezuela shipping oil directly to the US.

Woodside share price snapshot

The Woodside share price has rocketed 27% over the past year. In 2022, it is up 40%.

In the past month, Woodside shares have gained 19% as the war in Ukraine creates global fear about energy supply.

Woodside has a market capitalisation of about $32.19 billion based on its current share price.

The post Woodside (ASX:WPL) share price tumbles but boss sees ‘a change with us for decades’ appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Record $36bn in dividends could help ASX share market recovery
• Up 48% in 2022, why this ASX 200 energy giant is gaining again today
• Why Bapcor, GQG, Smartgroup, and Woodside shares are dropping
• Woodside (ASX:WPL) share price slips for first time in 7 days

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.

from The Motley Fool Australia https://ift.tt/o6STdIO

The BrainChip Holdings Ltd (ASX: BRN) share price has been a strong performer on Thursday.

In morning trade, the artificial intelligence technology company’s shares are up 8% to $1.14.

Why is the BrainChip share price shooting higher today?

The gain by the BrainChip share price today appears to have been driven by a rise in its US listed shares overnight in response to a press release.

According to the release from Wednesday morning Australia-time, the company has signed new sales partnerships in Europe and Israel that will further expand the commercial reach of its Akida neuromorphic computing platforms.

The release explains that BrainChip has partnered with Eastronics, a large, high-tech distributor in Israel, and SalesLink, a technology solutions provider in Europe.

Management believes these relationships serve as a gateway for introducing Akida technology to customers looking to leverage BrainChip’s IP across a wide range of applications. These include industrial Internet of Things (IoT), cybersecurity, autonomous vehicles, and smart sensors that can detect and act on visual features, sound, touch, smell, and taste.

It believes that Eastronics is ideally suited to benefit BrainChip’s global expansion in terms of customer presence and broad reach. This is from verticals such as medical, military, and industrial IoT markets, in the Israeli territory.

Whereas SalesLink has a broad reach that management believes will be instrumental in the building of BrainChip’s ecosystem and the go-to-market IP licensing plan in the Central Europe region.

BrainChip’s CEO, Sean Hehir, commented: “Partnerships with region and domain-focused sales organizations like Eastronics and SalesLink extend our reach to meaningful geographies and commercial opportunity.”

“We look forward to working closely with Eastronics and SalesLink, as well as developing relationships with other organizations in key territories, as we continue to deploy our commercialization plan for our revolutionary technology,” he added.

The post Why is the BrainChip (ASX:BRN) share price jumping 8% today? appeared first on The Motley Fool Australia.

More reading

• Brainchip (ASX:BRN) share price sinks 7% as ‘Most successful year in history’ comes at a cost
• Why is the Brainchip (ASX:BRN) share price tumbling 6% on Monday?

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.

from The Motley Fool Australia https://ift.tt/KfsjIob

The Commonwealth Bank of Australia (ASX: CBA) share price is up 1.2% in morning trade. That’s twice the 0.6% gain posted by the S&P/ASX 200 Index (ASX: XJO) at this same time.

CBA shares closed yesterday at $97.31 and are currently trading for $98.61.

That’s the early day price action. Now here’s why CBA’s boss is bullish on the year ahead.

Enormous surplus savings in the Aussie economy

If you own CBA shares, you’re probably familiar with the bank’s CEO, Matt Comyn.

Speaking on Tuesday at The Australian Financial Review Business Summit, Comyn said, “We’re very optimistic about everything that we’re seeing in the underlying data and looking ahead.”

Comyn noted that Russia’s invasion of Ukraine adds “a pool of uncertainty geopolitically”, while the severe flooding on the east coast “is going to have an economic impact”.

However, he said that following a “sharp contraction in operating performance across lots of sectors of the economy” in January, by the end of the month things began to “pick up right across the economy. And that’s held through.”

According to Comyn (quoted by the AFR):

We’re very positive about everything that we’re seeing in the economy. Obviously, unemployment is phenomenally strong and low. We’ve got enormous surplus savings in the economy. We think consumer and business confidence continues to come back. It’s going to be a couple of years of quite a strong tailwind. I think it’s a great set of economic conditions. It’s a great region to be in, Australia.

CBA estimates that the Aussie economy has grown more than 4% in the past 12 months. And the bank expects similar growth over the next 12 months.

Atop that, “We’re forecasting unemployment to get to 3.8% later this year,” Comyn said. “That’s going to be the lowest in 50 years – on the back of unprecedented monetary and fiscal support. I think we should feel pretty confident about the outlook.”

As for the businesses that have suffered through 2 years of pandemic restrictions, Comyn added:

It’s an opportunistic time, I think, for many businesses, having gotten through a period of extreme difficulty over the last couple of years of enormous uncertainty, and having demonstrated a lot of resilience and adaptability.

How have CBA shares been performing?

Over the past 12 months, CBA shares have gained 13.8%, outpacing the 5.8% gains posted by the ASX 200 in that same period.

Year-to-date the CBA share price is down 3.8%.

The post Own CBA (ASX:CBA) shares? Here’s why the bank’s boss is ‘very optimistic’ for 2022 appeared first on The Motley Fool Australia.

More reading

• Is the Westpac (ASX:WBC) share price the cheapest bank to buy right now?
• Record $36bn in dividends could help ASX share market recovery
• CBA (ASX:CBA) boss says this presents ‘a lot of opportunity’ for the bank
• ANZ has the largest ASX big four bank dividend yield right now. What?
• WAM boss urges cashed-up ASX 200 companies to buy, invest or pay dividends

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.

from The Motley Fool Australia https://ift.tt/7tpWbBO

Shares in AGL Energy Limited (ASX: AGL) are back in focus following a critique from one of the company’s major shareholders.

That shareholder is Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). The comments relate to the AGL board’s rejection of an increased $8.25 per share takeover offer from the Brookfield Consortium at the beginning of the week.

The AGL board strongly believes that the bid is well below fair value for the company. However, the AGL share price is still trading below the beefed-up bid. At the time of writing, shares in the energy giant are fetching $7.26 apiece.

So, what exactly did the board of the $9 billion investment house say about AGL?

Don’t look a gift horse in the mouth

In a second attempt to secure AGL and accelerate its green transition, Mike Cannon-Brookes and Brookfield lobbed a sweetened deal at AGL on Monday.

While many analysts and shareholders agreed the original $7.50 bid wasn’t enticing enough, the latest offer has been more warmly received.

However, AGL CEO Graeme Hunt and his fellow board members did not bite. Instead, they criticised their suitors for ignoring the potential future value of the company’s planned demerger.

Commenting on AGL’s reaction to the revised bid, Soul Patts chief executive Todd Barlow said:

It’s possibly something that needs a bit more thought from the board. I think you are seeing smaller premiums being offered because it is being weighed up against the risks that you are seeing with the demerger.

Soul Patts is not the only shareholder that believes the offer was at least worth exploring. Global investment manager VanEck holds a $27.6 million position in AGL.

VanEck deputy head of investments and capital markets, Jamie Hannah stated:

We absolutely think that AGL should open their books to the consortium so they can do a proper due diligence.

Will it be Brookfield’s last crack at taking AGL off the ASX?

The current situation is akin to a game of poker. There are two players in this game and both might be trying to bluff their way to a winning outcome.

Firstly, AGL could be playing the uninterested approach to secure another increased bid from the consortium. Secondly, the Brookfield Consortium could be parading the $8.25 as its final bid to get the Aussie energy company at a reasonable price.

Following the rejection of the revised bid, Cannon-Brookes posted on Twitter that it was ‘pens down’ for them.

The Brookfield-Grok consortium looking to take private & transform AGL is putting our pens down – with great sadness.

This weekend, the board rejected our raised offer of $8.25. 46% more than the price of $5.55 about 90 days ago (1/3) pic.twitter.com/c5KYwGozDo

— Mike Cannon-Brookes (@mcannonbrookes) March 6, 2022

https://platform.twitter.com/widgets.js

Ultimately, we’ll have to wait and see whether this is truly Brookfield’s last play at AGL.

AGL share price snapshot

The AGL share price is up 16.2% since the beginning of the year.

The post Soul Patts urges AGL (ASX:AGL) board to give ‘more thought’ to takeover bid appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: AGL rejects new takeover offer, Appen makes strategic investment
• AGL (ASX:AGL) share price on watch amid improved takeover offer
• Will Mike Cannon-Brookes bring an extra $1 billion to the table in his AGL takeover bid?
• Why did AGL (ASX:AGL) shares smash Origin in February?
• Shareholder calls out AGL (ASX:AGL) planned demerger as ‘value destructive’

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/3GlQLbA

The S&P/ASX 200 Index (ASX: XJO) is having another pleasing opening so far this morning after yesterday’s welcome recovery. At the time of writing, the ASX 200 is up a decent 0.69% at just under 7,101 points. So it might come as an initial disappointment to see that the South32 Ltd (ASX: S32) share price doesn’t seem to be joining the party.

In fact, South32 shares look like they are tanking today. The diversified miner is currently down by a nasty 4.06% at $4.73 a share.

Now, you might think this drop is related to the general rejection of mining and energy shares that we are seeing so far on the ASX today. South32’s compatriots, such as BHP Group Ltd (ASX: BHP), Fortescue Metals Group Limited (ASX: FMG), and Woodside Petroleum Limited (ASX: WPL), are indeed all in the red thus far.

But investors can blame another factor for making things worse for the South32 share price. However, it’s not necessarily a bad one.

South32 share price lower after trading ex-dividend

Today is the day that South32 shares have traded ex-dividend for the company’s upcoming interim dividend payment. Yes, from today, any new investors in South32 will be ineligible to receive this company’s latest dividend. As such, the value of this dividend has left the South32 share price.

But investors who owned the shares prior to today can look forward to a figurative cheque in the mail. The fully franked interim payment will be worth 8.7 US cents per share. This will be sent out to investors on 7 April.

As is common with dividends initially determined in a foreign currency, we don’t yet know for sure how much this dividend is worth in our own dollars. But on today’s exchange rates, a payment of 8.7 US cents would equate to approximately 12 Australian cents per share.

On the current South32 share price, this ASX 200 miner has a dividend yield of 3.59%.

South32 shares are up 18% this year to date and 72% over the past 12 months.

The post Here’s why the South32 (ASX:S32) share price is sliding today appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Here are the 3 most heavily traded ASX 200 shares this Wednesday
• Want the dividends from these 5 ASX shares? You’d better be quick!
• These 3 ASX 200 shares are topping the volume charts on Tuesday
• Here’s why the South32 (ASX:S32) share price has soared 25% in a month

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.

from The Motley Fool Australia https://ift.tt/OEmDsIS

The Rio Tinto Limited (ASX: RIO) share price is heading south during morning trade on Thursday.

This comes despite the world’s second-largest miner not releasing any market-sensitive news today.

At the time of writing, Rio Tinto shares are down 7.32% to $111.10 apiece.

Why are Rio Tinto shares falling today? 

Following the company’s full-year results released on 23 February, investors are eyeing Rio Tinto shares as they go ex-dividend today.

This means that investors who bought the company’s shares on Wednesday or before will be eligible for the latest dividend. Anyone who purchases the shares today will miss out as the seller has secured the dividend.

Historically, when a company reaches its ex-dividend day, its shares tend to fall in proportion to the dividend paid out.

When can Rio Tinto shareholders expect payment?

For those eligible for Rio Tinto’s final dividend, shareholders will receive a total payment of US$10.40 per share on 21 April. The dividend is fully franked which means that investors will receive tax credits from this.

The latest dividend is an 87% increase compared to the prior corresponding period (US$5.57 per share in FY20).

The payout figure represents an annualised dividend yield of 11.87% based on Wednesday’s closing price.

Furthermore, the $16.8 billion full-year dividend represents a payout of 79% of underlying earnings. This is above management’s policy of returning between 40% to 60% of underlying earnings to shareholders.

Are Rio Tinto shares a buy?

Following the company’s full-year results, a number of brokers weighed in on the Rio Tinto share price.

The team at Citi downgraded its outlook on the miner’s shares to “neutral” from “buy”, but raised its price target by 4.3% to $120.00.

In addition, Morgans has a similar view for Rio Tinto shares, lifting its take by 9.3% to $117.00.

However, the most bullish brokers were Goldman Sachs and Macquarie. The former improved its price target by 2.1% to $132.50, while Macquarie slashed its rating by 1% to $129.00.

This represents an upside of between 6% and 20% from were Rio Tinto shares are trading today.

About the Rio Tinto share price

Despite today’s drop, the Rio Tinto share price has climbed by 10% since the beginning of the year.

On valuation grounds, Rio Tinto commands a market capitalisation of around $44.5 billion, with approximately 371.22 million shares outstanding.

The post Here’s why the Rio Tinto (ASX:RIO) share price is sliding 7% today appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Record $36bn in dividends could help ASX share market recovery
• 3 under-the-radar commodity prices soaring since the Ukraine crisis
• Want the dividends from these 5 ASX shares? You’d better be quick!
• WAM boss urges cashed-up ASX 200 companies to buy, invest or pay dividends

Motley Fool contributor Aaron Teboneras 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.

from The Motley Fool Australia https://ift.tt/gstYiN2

The Myer Holdings Ltd (ASX: MYR) share price is on fire on Thursday morning.

In morning trade, the department store operator’s shares are up 21% to 49.5 cents after investors responded positively to its half year results release.

Myer share price jumps amid solid growth and dividend return

• Total sales growth of 8.5% to $1,517.4 million
• Comparable store sales growth of 17.8%
• Online sales growth of 47.5% to $424.1 million, now representing 27.9% of total sales
• Operating gross profit growth of 7.8% to $582.2 million
• Net profit after tax up 55.2% to $32.3 million (excluding JobKeeper)
• Statutory net profit after tax down 24.9% to $32.3 million
• First dividend declared since FY 2017 with fully franked 1.5 cents per share interim dividend
• Net cash up $16 million to $217 million

What happened during the first half?

For the six months ended 29 January, Myer delivered an 8.5% increase in sales to $1,517.4 million. This was driven by strong growth from its online business, which reported a 47.5% increase in sales to $424.1 million. This side of the business now accounts for approximately 28% of total sales.

Things were even better on the bottom line if you exclude the JobKeeper payments the company received in the prior corresponding period. Excluding these payments, Myer’s net profit after tax rose 55.2% to $32.3 million.

In light of this and its improving cash position, Myer has elected to pay its first dividend since FY 2017. It will be paying shareholders a fully franked 1.5 cents per share interim dividend.

Management commentary

Myer’s CEO, John King, said: “The half year results we have announced today demonstrate the strength and resilience of the business providing continued momentum for future growth.”

“The combination of our online platform and store network performed well in navigating the challenges faced during the period including disruptions caused by government-mandated lockdowns to mid-October, the emergence of Omicron in late December, and the mitigation of major supply chain disruption and staffing availability in early 2022.”

“Myer will pay a dividend for the first time in four years, demonstrating our confidence in the momentum being built as we move into the second half, with a return to sales growth in the first five weeks of second half with trade up 15.2% and a strong platform of future initiatives that are yet to be delivered as part of the Customer First Plan,” he added.

Trading update

Also potentially giving the Myer share price a boost today is the company’s update on trading so far in the second half.

It advised that during the first five trading weeks of the second half, it has seen a strong return to growth in stores and online. Myer sales are up 15.2%, with store sales up 9.3% and online up 48.6%.

Mr King said: “Despite the initial impact of Omicron in early January, we have returned to a growth trajectory – delivering 15.2% sales growth in the first five weeks of trade in the second half across both stores and online.”

The post Myer (ASX:MYR) share price up 21% amid strong half year result and first dividend since FY17 appeared first on The Motley Fool Australia.

More reading

• Here’s why the Newcrest (ASX:NCM) share price is in the red today
• 5 human urges that stop you from making money
• Is the QBE (ASX:QBE) share price a bargain after falling 19% in a month?
• Why did the Flight Centre (ASX:FLT) share price have such a volatile time in 2022?
• The Bank of Queensland (ASX:BOQ) share price has lost half its value in 15 years. How is the bank’s turnaround strategy going?

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.

from The Motley Fool Australia https://ift.tt/Qg8rb0G

The Newcrest Mining Ltd (ASX: NCM) share price is down 3.7% in early trade.

Newcrest closed yesterday at $28.20 and is currently trading for $27.16.

Shares look to be coming under pressure amid a fall in gold prices, with bullion down 2.5% overnight. That’s seen the S&P/ASX All Ordinaries Gold Index (ASX: XGD) open down 3.3% today.

Below we take a look at how the S&P/ASX 200 Index (ASX: XJO) gold miner’s Canadian acquisition is progressing.

What’s the latest on the ASX 200 gold miner’s acquisition?

The Newcrest share price is dipping despite the miner reporting it has completed its acquisition of Pretium Resources Inc, known as Pretivm.

Following the transaction, Pretivm will be delisted from the New York Stock Exchange and Toronto Stock Exchange.

Via the acquisition, Newcrest gains ownership of Pretivm’s Brucejack mine, located in British Columbia, Canada. According to the release, Brucejack counts amongst the highest-grade operating gold mines in the world.

Newcrest expects Brucejack will result in an immediate increase in its gold production and cash flows, quoting expected synergy benefits of some US$12 to $16 million annually. The Canadian asset is forecast to produce 95–115 thousand ounces of gold during Newcrest’s ownership in the 2022 financial year.

Commenting on the acquisition, Newcrest’s CEO, Sandeep Biswas said:

Through this acquisition and the continued development of our outstanding organic growth pipeline, Newcrest’s base case gold production is expected to remain strong until at least 2030, and we have a range of further upside opportunities being progressed across the portfolio. This production profile is also expected to drive a major reduction in All-In Sustaining Costs, which makes Newcrest unique in the industry.

Moving forward, Biswas added, “Our exploration team will be progressing an extensive drilling campaign across the Brucejack mineral claims which make up one of the largest epithermal footprints we have ever seen. The land package is largely unexplored and very early in its life…”

Newcrest share price snapshot

On the back of soaring gold prices (which retreated 2.5% overnight), the Newcrest share price has gained 19% over the past month. By comparison, the ASX 200 is down 3% in that period.

Year-to-date Newcrest shares are up 13%.

The post Here’s why the Newcrest (ASX:NCM) share price is in the red today appeared first on The Motley Fool Australia.

More reading

• Gold rush! Why are Newcrest Mining (ASX:NCM) shares up 4% today?
• 5 things to watch on the ASX 200 on Monday
• Here are the top 10 ASX shares today
• ASX 200 dives to 4-day low following Ukraine nuclear power plant crisis
• Why Infomedia, Newcrest, Piedmont Lithium, and Woolworths shares are rising today

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.

from The Motley Fool Australia https://ift.tt/zkI6dhH

Investing is not easy. Otherwise everyone would do it and be rich already.

The fact is that optimal investing always requires completely rational decision making. Unfortunately, humans are terrible at being completely rational.

Emotions, even for the calmest individuals, take over subconsciously. 

So imagine that. Not only is investing hard, you have to constantly fight yourself to make the right calls.

You consistently lose against the index

This human tendency to act emotionally is seen in the statistics.

According to research firm Dalbar, the average investor consistently earns less-than-average returns.

“Dalbar found that for the 20 years ending December 31, 2019, the S&P 500 Index (SP: .INX) averaged 6.06%pa. The average equity fund investor earned a market return of only 4.25%pa,” stated a BetaShares blog post.

Even during 2020, when we saw a spectacular stock market bounce-back after a COVID-19 correction, the average investor earned 17.3% versus the S&P 500’s 18.4%.

And the gap was horrifying in the first half of 2021, when the average investor reaped 13.14% while the index went up by 15.25%.

So, as retail investors, how do we combat this?

The first step is to recognise how emotions compel us to make wrong decisions.

“While almost everyone is susceptible to the influence of emotional factors, it is important to raise these influences from the unconscious to the conscious,” stated BetaShares. 

“Educate yourself on the biases that investors are commonly prone to, and ask yourself whether your decisions are being influenced by them.”

Here are 5 behavioural biases that BetaShares warned investors to watch for:

Cognitive dissonance

When new information disagrees with existing knowledge, it’s emotionally jarring. To regain their comfort, people may form “obscure rationalisations”.

“As a result, we may often focus on the positives of the selection we have already made and ignore the downsides implied by the new information,” stated the BetaShare blog.

“From an investment perspective it means we may be overly focused on a stock or an ETF’s upside whilst ignoring the risks.”

The remedy to this bias is to treat information that challenges your existing beliefs with as much respect as views that agree with your ideas.

Confirmation bias

This is when an observation confirms our existing beliefs, thereby increasing our conviction, to the exclusion of other possibilities.

For example, if you have a preconceived idea that brown-haired people catch a cold more often than others, every time you see a brunette fall ill it reinforces the theory. This may happen even though all black-haired, red-haired and blonde acquaintances may not present themselves to you when they catch a cold.

BetaShares used the investment example of holding a belief that ASX shares are superior to overseas markets.

“Positive forecasts for the Australian market may be accepted without question, while information supporting strong performance of international equities may be discounted,” the blog post read.

“This may help us justify being invested in only Australian equities with little diversification.”

The moral here is to evaluate all information neutrally, regardless of whether it supports or refutes existing beliefs.

Illusion-of-control bias

This is the false belief of investors that they have influence over a situation that they can’t possibly control.

The movement of a stock’s price, for example.

“This can lead to investors being impatient and trading in and out of the market under the assumption they can control the investment outcomes,” stated BetaShares.

“It can also lead to overconfidence and taking larger than usual risks.”

Always remember the things about your investment that you can definitely control, like purchase price and exit price. Outside of that, there is not a lot that retail investors can influence.

Regret bias

This is when the fear of later regret paralyses decision making.

“Under the influence of this bias, investors start to anticipate and fear the regret that may come with incurring a loss or forfeiting a gain.”

Regret bias makes investors “timid” and unwilling to try different opportunities.

“This may lead to missing out on new – but unfamiliar – investment opportunities such as emerging markets or new sectors, such as technology.”

Perhaps the best way to combat this bias is to remember there can also be regret after not taking action.

Conservatism

Conservatism makes investors stick to their existing views while sacrificing important new information.

“If a recent stock or market outlook is poor and is at odds with a previous positive outlook on the economy or stock, there is a tendency to disregard the latest set of information,” the BetaShares blog read.

“It means we may under react to fundamental information.”

This bias can be overcome by treating later information with as much credibility as early impressions.

The post 5 human urges that stop you from making money appeared first on The Motley Fool Australia.

More reading

• Here’s why the Newcrest (ASX:NCM) share price is in the red today
• Is the QBE (ASX:QBE) share price a bargain after falling 19% in a month?
• Why did the Flight Centre (ASX:FLT) share price have such a volatile time in 2022?
• The Bank of Queensland (ASX:BOQ) share price has lost half its value in 15 years. How is the bank’s turnaround strategy going?
• The AMP (ASX:AMP) share price has dumped 16% in under 4 weeks. What’s happening?

Motley Fool contributor Tony Yoo 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.

from The Motley Fool Australia https://ift.tt/cwIiVq9

The QBE Insurance Group Ltd (ASX: QBE) share price has been a poor performer in recent weeks.

Since this time last month, the insurance giant’s shares are down a disappointing 19%.

What’s going on with the QBE share price?

There have been a few catalysts for the weakness in the QBE share price over the last few weeks.

These include its shares trading ex-dividend for its final dividend, the east coast floods, and its full year results release.

In respect to the latter, for the 12 months ended 31 December, QBE delivered a 25.7% increase in gross written premium to US$18,453 million. This ultimately led to the insurance giant reporting an adjusted cash net profit after tax of US$805 million.

While this may look strong at first glance, it was actually a big miss. The market consensus estimate was for a cash net profit after tax of US$870 million. Unsurprisingly, this led to its shares falling heavily following the release.

Is this a buying opportunity?

One leading broker that sees a lot of value in the QBE share price is Morgans. Earlier this week, the broker put the insurance giant on its best ideas list for the month of March. Its analysts believe the company’s shares are cheap at the current level.

It commented: “With strong rate increases still flowing through QBE’s insurance book, and further cost-out benefits to come, we expect QBE’s earnings profile to improve strongly over the next few years. The stock also has a robust balance sheet and remains relatively inexpensive overall trading on ~12x FY22F PE.”

Morgans has an add rating and $13.50 price target on the company’s shares. Based on the current QBE share price of $10.36, this implies potential upside of 30% over the next 12 months.

The broker is also expecting a 58.2 cents per share dividend in FY 2022, which would mean a 5.6% dividend yield. All in all, this brings the total return on offer to approximately 36%.

The post Is the QBE (ASX:QBE) share price a bargain after falling 19% in a month? appeared first on The Motley Fool Australia.

More reading

• 3 more of Morgans’ best ASX share ideas for March
• Here’s why the QBE (ASX:QBE) share price is sliding 5% today
• QBE (ASX:QBE) share price backtracks as CEO realigns group’s strategy
• ASX 200 (ASX:XJO) midday update: Block, Zip tumble, QBE’s asset sale
• ‘$2 billion cost’: How are the floods impacting ASX 200 insurance shares this week?

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.

from The Motley Fool Australia https://ift.tt/6cozJgh