Tag: Motley Fool

What a sorry story the Magellan Financial Group Ltd (ASX: MFG) share price has been for investors over the past few years. It was only back in early 2020 that this ASX 200 fund manager was hitting all-time highs of over $74 a share.

Today, Magellan closed at $15.32 a share, up 3.51% for the day.

Sure, Magellan has bounced lucratively (around 30%) off of its 52-week low of $11.10 over the past month or so.

But the company is still down by almost 20% in 2022 alone, and by 66% over the past 12 months. It’s also down around 80% from the all-time high of February 2020.

Fi fi fo FUM

Unfortunately, the problem Magellan is having is arguably structural. As a fund manager, Magellan’s bread and butter is funds under management (FUM). A fund manager like Magellan manages its client’s money on their behalf. But for this privilege, it clips the ticket.

Typically, funds like Magellan charge fixed fees on the total capital invested, plus a performance fee if the fund’s performance exceeds its benchmark.

Thus, the only real way for a fund manager like Magellan to grow its earnings over time is by either delivering consistent outperformance or growing its FUM.

If it can do both, it can unlock a flywheel effect, where investors are drawn to the manager for its ability to deliver outsized returns, thus increasing FUM.

But unfortunately for this company, the inverse scenario, which one could pessimistically call a ‘death spiral’, seems to be occurring.

Back in February 2020, Magellan reported that its FUM stood at $104.31 billion.

Last week, the company reported its FUM, as of 31 July, was just $60.2 billion, having slid around $1 billion from the prior month.

The reasons for this loss of confidence from investors are many. We have the dramatic departure of Magellan co-founder Hamish Douglass to consider. As well as the loss of several high-profile investment mandates, such as the one from St James’ Place.

What’s gone so wrong with the Magellan share price?

But the root of Magellan’s problems arguably comes from the performance of its funds themselves.

Take the company’s flagship Global Fund. As of 31 July, the Magellan Global Fund has lost 9.8% over the preceding 12 months, against its benchmark’s (the MSCI World Net Total Return Index) loss of 4.31%.

Over the past three years, this fund has averaged a performance of 2.83% per annum, trailing the benchmark’s average of 9.13%. Over ten years, the fund has averaged 14.01% against the MSCI’s 14.83%.

That’s probably enough to prompt investors to ask what they are paying a management fee of 1.35% per annum for.

Magellan’s High Conviction Fund, which investors pay a fee of 1.5% per annum to invest in, hasn’t done much better. It’s averaged a negative return of 0.46% per annum over the past three years. 

So we have underperforming funds, and ongoing bleeding of FUM – perhaps an inversion of the flywheel effect we discussed earlier.

It’s too soon to say if Magellan is in such a ‘death spiral’. But unless the company can boost its funds’ returns, it could struggle to attract additional FUM going forward.

At the current Magellan share price, this ASX 200 fund manager has a market capitalisation of $2.83 billion, with a price-to-earnings (P/E) ratio of 8.5.

The post Is the Magellan share price caught in a death spiral? appeared first on The Motley Fool Australia.

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More reading

• What’s $1 billion between friends? Magellan share price shrugs off latest FUM figures
• Is the Magellan share price a buy for its big dividend yield?
• Morgan Stanley forecasts Magellan share price will sink 35%
• Why has the Magellan share price leapt 21% in a week?
• Here are the top 10 ASX shares today

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 Scott Phillips.

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The BHP Group Ltd (ASX: BHP) share price has suffered a sizeable drop over the last six months, falling by around 20%.

Considering the massive size of the BHP market capitalisation, the 20% drop represents a large fall in dollar terms.

But, can things turn around quickly or will BHP shares be in the doldrums for some time?

Don’t forget, BHP no longer owns a petroleum division, so it’s not benefitting from the high prices and useful cash flow.

When it comes to commodity ASX shares, they are heavily reliant on the resource price. A rise in the resource price can largely add to profit, which can then help the share price.

But, the opposite has been happening with the iron ore price, which has dropped substantially in the last few months.

According to reporting by the Australian Financial Review, analysts at Morgan Stanley are not confident about iron ore this year

Will there be an iron ore recovery for BHP?

In possible bad news for the BHP share price, Morgan Stanley commodities strategist Marius van Straaten said:

We see little reason to be bullish on iron ore into year-end. Any real rebound in the iron ore price hinges on a China-led steel demand recovery.

One of the biggest questions for iron is what happens with steel in China. As reported by the AFR, Chinese property construction accounts for around 40% of steel demand. June property starts were down 45%.

It has also been reported that mortgage arrears are increasing on properties currently being constructed in China. Borrowers don’t want to pay when no progress is being made on the construction of their property.

Van Straaten said:

While this latest situation might be contained and property activity might not slow further from current levels, there are as yet no signs of a meaningful recovery.

Low steel profit margins may also have been hurting steel production within the Asian superpower. But, the AFR reported that Macquarie has pointed out that steel margins have been improving recently thanks to rising steel prices and a weaker iron ore price.

Is the BHP share price an opportunity?

Part of the investing thoughts about BHP at the moment include the attempt to buy OZ Minerals Limited (ASX: OZL) with a cash bid of $25 per share.

As reported by my colleague Tony Yoo, the broker Morgans said:

If nothing else, this development should reduce any concern that BHP might have been considering a larger, more transformative acquisition.

There has been a consistent fear from some that history would repeat itself and BHP eventually [becomes] attracted to a +$100 billion acquisition/merger at a high point in the cycle. Instead, BHP has remained on-strategy and focused.

Morgans’ price target of $48.40 on the BHP share price suggests a bounce back over the next 12 months of more than 20%.

Macquarie is another broker expecting good things for BHP shares with a price target of $48. That also implies a rise of more than 20%.

However, UBS is much less optimistic. It’s ‘neutral’ on the business, with a price target of just $35.50. That implies a further drop of around 10%.

The BHP share price closed 2.22% higher on Thursday at $39.15.

The post Down 20% in 6 months, what’s next for the BHP share price? appeared first on The Motley Fool Australia.

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More reading

• 3 rising ASX shares to buy that have passed the bottom: expert
• Top brokers name 3 ASX shares to buy today
• 2 ASX 200 blue chip shares brokers rate as buys
• What’s so good about copper anyway?
• What could another acquisition mean for BHP shares?

Motley Fool contributor Tristan Harrison 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 Macquarie Group Limited. 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 S&P/ASX 200 Index (ASX: XJO) regained its composure today, surging higher led by discretionary and real estate shares. The index closed 1.12% higher at 7,071 points on Thursday.

Only one sector finished in the red today. The S&P/ASX 200 Utilities Index (ASX: XUJ) plunged 1.5%, weighed down by the share price of APA Group Ltd (ASX: APA), despite the company’s silence.

Meanwhile, the S&P/ASX 200 Consumer Discretionary Index (ASX: CDJ) led the gains, leaping 2.2%.

It might have been boosted by news out of the US. Inflation in the nation slowed in July, likely leading some to hope the Federal Reserve might slow its approach to rate hikes.

Perhaps unsurprisingly, the news seemingly brought joy to Wall Street. The Dow Jones Industrial Average Index (DJX: .DJI) and the S&P 500 Index (SP: .INX) lifted 1.6% and 2.1% respectively overnight while the tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) rose 2.9%.

That likely helped the S&P/ASX 200 Information Technology Index (ASX: XIJ) rise 1.3% today while the S&P/ASX 200 Real Estate Index (ASX: XRE) gained 2% amid earnings from GQG Partners Inc (ASX: GQG).

But which share outperformed all others on Thursday to take out the top spot among its ASX 200 peers? Keep reading to find out.

Top 10 ASX 200 shares countdown

Today’s top performing ASX 200 share was none other than – drum roll please – lithium favourite Lake Resources N.L. (ASX: LKE). The stock gained 21% today despite no news being released by the company. Find out what’s been going on with Lake Resources lately here.

Today’s biggest gains were made by these ASX shares:

ASX-listed company	Share price	Price change
Lake Resources N.L. (ASX: LKE)	$1.595	20.83%
Life360 Inc (ASX: 360)	$5.38	13.26%
City Chic Collective Ltd (ASX: CCX)	$2.35	12.98%
Novonix Ltd (ASX: NVX)	$3.27	10.85%
Block Inc (ASX: SQ2)	$126.40	8.42%
Pinnacle Investment Management Group Ltd (ASX: PNI)	$11.47	7.2%
Pointsbet Holdings Ltd (ASX: PBH)	$3.80	6.44%
Seek Limited (ASX: SEK)	$24.64	5.43%
Netwealth Group Ltd (ASX: NWL)	$13.61	5.1%
Brainchip Holdings Ltd (ASX: BRN)	$1.16	4.98%

Our top 10 ASX 200 shares countdown is a recurring end-of-day summary to let you know which companies were making big moves on the day. Check in at Fool.com.au after the weekday market closes to see which stocks make the countdown.

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Why Block, Lake, Mirvac, and QBE shares are racing higher
• Why are ASX 200 tech shares flying higher on Thursday?
• Why has the Block share price exploded 9% on the ASX today?
• Why is the Novonix share price leaping 11% on Thursday?

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 positions in and has recommended Block, Inc., Life360, Inc., Netwealth, PINNACLE FPO, and Pointsbet Holdings Ltd. The Motley Fool Australia has positions in and has recommended APA Group, Block, Inc., Netwealth, and PINNACLE FPO. The Motley Fool Australia has recommended Pointsbet Holdings Ltd and SEEK Limited. 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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Commonwealth Bank of Australia (ASX: CBA) is the only major big four bank share to release its annual result this month. But what did the result mean for National Australia Bank Ltd (ASX: NAB) shares?

Investors may think that the big four ASX banks of CBA, NAB, Australia and New Zealand Banking Group Ltd (ASX: ANZ) and Westpac Banking Corp (ASX: WBC) are all roughly the same. They are pretty similar, lending is the key profit driver. But, they are somewhat different.

If a potential borrower needs a mortgage they need to pick one bank. A gain of market share for one bank could mean the loss of market share for another.

And why would CBA’s result matter for NAB shares? Well, investors may want to take note of the strong growth that CBA is seeing in one particular area, which NAB is known for.

CBA’s growth to impact NAB shares?

NAB has a reputation as being a business bank.

CBA is more focused on household lending. But, the FY22 result showed that CBA is growing quickly in the business sector.

The biggest bank reported that its business lending grew by 13.6%, or $15.4 billion. This was 1.3 times the growth rate of the total system.

The amount of business deposits grew at an even faster rate, rising by 15.1% or $23.9 billion in dollar terms. That was 1.4 times the growth rate of the overall banking system. CBA also said that during FY22, its business lending margins increased.

CBA said that it is focused on continuing to differentiate its transaction and merchant banking propositions, and digitising the business banking experience. The bank said it wants to be Australia’s “leading business bank”. CBA said:

Our business banking strategy is centred around the quality of our customer relationships and being their main financial institution. We are proud of the strong customer relationships we have developed through the strength of our transaction banking, business lending and merchant offerings.

Our focus is to deepen these relationships by partnering with our customers and proactively meeting more of their needs. This, combined with our superior customer experience and leading physical and digital distribution, will allow us to exceed customer expectations and deliver sustainable growth and outperformance.

CBA also said that it wants to be at the forefront of how Australian businesses pay and get paid.

How bad is this for NAB shares?

Well, time will tell. CBA isn’t specifically targeting NAB with this initiative. There are more lenders out there than just CBA and NAB.

There could be enough of a business lending market for both CBA and NAB to do well.

NAB said in its FY22 half-year result that its business lending increased from $220.8 billion at September 2021 to $237.1 billion in March 2022. NAB’s third quarter report also showed more business lending growth.

In NAB’s quarterly update, its cash earnings grew by 6% year over year. It was an increase of 10% of cash earnings before tax and credit impairment charges.

Management confident on the future

With the release of the FY22 third quarter, NAB CEO Ross McEwan said:

We have a clear strategy and executing this with discipline is our key priority. We will continue to focus on getting the basics right, managing our bank safely and improving customer and colleague outcomes to deliver sustainable growth and improved shareholder returns.

The post What does CommBank’s latest update mean for NAB shares? appeared first on The Motley Fool Australia.

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More reading

• Is the CBA share price a buy after the bank’s FY22 results?
• Does this signify more bad news for ASX BNPL shares like Zip?
• The CBA share price looks downright expensive
• CBA share price slides today despite an 11% FY22 earnings leap
• Here’s everything you need to know about the latest CBA dividend

Motley Fool contributor Tristan Harrison 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 Westpac Banking Corporation. 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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Finally, a decent day of trading for the S&P/ASX 200 Index (ASX: XJO). After an indecisive few trading days, the ASX 200 is today upswinging with a vengeance, up 0.91% at the time of writing at around 7,060 points.

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

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• Why AMP, OFX, Rio Tinto, and Telstra shares are dropping
• Why Block, Lake, Mirvac, and QBE shares are racing higher
• Why has the Block share price exploded 9% on the ASX today?
• Here’s why the BetaShares Nasdaq 100 ETF (NDQ) is outperforming the ASX today
• Why is the Core Lithium share price rocketing 5% today?

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 Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) us having a very strong day on Thursday. In late trade, the benchmark index is up 1% to 7,061.2 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are dropping:

AMP Ltd (ASX: AMP)

The AMP share price is down 2% to $1.14. Investors have been selling this financial services company’s shares following the release of its half year results. Not even the promise of a $1.1 billion capital return has been able to boost its shares today. Investors appear to be focusing more on its underlying after tax profit of $117 million, which was down 24.5% on on the prior corresponding period.

OFX Group Ltd (ASX: OFX)

The OFX share price is down almost 6% to $2.61. This morning the foreign exchange company released its annual general meeting update. At the event, the company reaffirmed its guidance for FY 2023. However, judging by its share price performance, investors appear to have been hoping there would be an upgrade to its EBITDA guidance of $55 million to $60 million.

Rio Tinto Limited (ASX: RIO)

The Rio Tinto share price is down 4% to $95.34. The catalyst for this has been the mining giant’s shares trading ex-dividend this morning for its upcoming dividend. Eligible shareholders can now look forward to being paid a fully franked $3.837 per share interim dividend in around six weeks on 22 September. This was the miner’s second largest interim dividend in its history.

Telstra Corporation Ltd (ASX: TLS)

The Telstra share price is down 1.5% to $3.95. This telco giant’s shares were having a good day this morning following the release of a strong full year result. However, they have faded as the day went on. This is despite its earnings coming in ahead of expectations in FY 2022. It’s possible that a rotation back into higher risk shares has reduced the appeal of Telstra today.

The post Why AMP, OFX, Rio Tinto, and Telstra shares are dropping appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Equity markets threaten to ‘melt up’ as Nasdaq enters bull market territory
• Everything you need to know about the latest Telstra dividend
• AMP share price slides as $1.1b pledged to investors
• Do any ASX lithium shares pay dividends?

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 positions in and has recommended Telstra Corporation Limited. 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 share price of Qantas Airways Limited (ASX: QAN)’s takeover target Alliance Aviation Services Ltd (ASX: AQZ) is taking off after the charter operator posted its full-year earnings after the market closed on Wednesday.

After opening 1.5% lower at $3.31, the Alliance Aviation share price has rebounded to trade at $3.42 at the time of writing – representing a 1.79% gain.

Alliance Aviation share price lifts despite $7.1 million loss

• Underlying before tax profit of $45.3 million – an 11% drop on that of the prior corresponding period (pcp)
• Statutory loss before tax of $7.1 million
• Revenue came in at $367.5 million – a 19% increase
• Underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) of $91 million – a 1% improvement
• Underlying operating cash flow of $99.3 million – down 52%
• Declined to pay a dividend.

The ASX airline share posted a loss for the financial year 2022 despite recording higher revenue after being hit with additional costs and write-downs.

It incurred $14 million in E190 expansion related-costs in the second half, bringing the full year total to $39.1 million. It also incurred a non-cash $12.1 million write-down of its Fokker 50 fleet, a $400,000 inventory stocktake adjustment and $750,000 in fees relating to the Qantas takeover.

The company saw 4% more contract flight hours last financial year but 57% fewer charter flight hours. It also recorded a 612% jump in wet lease flight hours.

It noted an expected uplift in financial performance in the June quarter didn’t occur due to the ongoing impacts of COVID-19.

What else happened in FY22?

Of course, the major news from the airline in the financial year 2022 was the takeover bid posted by Qantas.

The national carrier’s offer to hand over one Qantas share for each Alliance Aviation share – implying an equity value of $764.5 million at the time – was recommended by the smaller airline’s board in May.

The Alliance Aviation share price surged 21% on the takeover news.

However, the acquisition must jump through many regulatory hoops before it can be implemented.

What did management say?

Alliance Aviation managing director Scott McMillan commented on the company’s earnings, saying:  

For Alliance to be able to service the capacity demands of all our clients in the 2023 financial year and beyond it was essential that the company continued to invest in growth during the second half of the year with the full knowledge that forecast activity growth would only commence from April 2022.

What’s next?

The company hasn’t provided any new guidance today. Though it did outline several steps it will take going forward.

The company noted it has recently experienced greater pilot turnover. In reaction, it will increase training and recruitment of pilots and provide non-monetary incentives to those staying with the airline.

It will also converge the Unity Aviation Maintenance operations into those of Alliance Airlines and retire its Fokker 50 fleet early in a bid to simplify the business.

It maintains a positive outlook amid continually strong wet lease demand. The company also expects that, by the end of January 2023, it will have deployed all 33 of its E190 aircraft.

Alliance Aviation share price snapshot

It’s been a rough year for the charter services provider’s stock.

The Alliance Aviation share price fell 13% over the six months ended 30 June. That was in line with the All Ordinaries Index (ASX: XAO)’s performance.

It’s currently 15% lower than at the start of 2022, while the index is recording an 8% fall year-to-date.

The post Alliance Aviation share price lifts despite full-year loss appeared first on The Motley Fool Australia.

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More reading

• Why Alliance, Aurizon, MVP, and Suncorp shares are dropping today

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 recommended Alliance Aviation Services Ltd. 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 Santos Ltd (ASX: STO) share price is climbing during afternoon trade on Wednesday.

This comes after the company announced an acquisition of a crucial gas pipeline to service the east coast domestic market.

At the time of writing, the energy producer’s shares are up 0.86% to $7.02 apiece.

Santos procures Hunter Gas Pipeline

Investors are pushing Santos shares into positive territory despite the S&P/ASX 200 Energy (ASX: XEJ) sector shedding 0.36% today.

According to its latest release, Santos advised it has acquired a critical component for delivering gas from Northern Australia.

The Hunter Gas Pipeline owns an approved underground pipeline route from Wallumbilla in Queensland to Newcastle in New South Wales.

As this pipeline passes close to Santos’ Narrabri Gas Project, management is seeking to team up with infrastructure developers to service the east coast domestic market.

Santos wants to construct the pipeline and connect it to the Wallumbilla Gas Supply Hub in the shortest timeframe possible.

The pipeline will also be designed to transport hydrogen as customer demand progresses during the energy transition.

Santos’ midstream and clean fuels president Brett Woods said:

At a time when the ACCC is forecasting domestic gas shortfalls, our Narrabri project, which is 100 per cent committed to the domestic market, will inject new supply into southern domestic markets and put downward pressure on gas prices for New South Wales businesses, manufacturers and families.

It will make more gas available to cover peak demand periods, especially in circumstances where gas power generators are called on unexpectedly to replace wind, solar and coal outages, as we have seen this winter.

Woods also went on to talk about the next stage of development, adding:

Acquiring the Hunter Gas Pipeline route is an important step for the Narrabri project, with appraisal drilling planned later this year, pending various native title and environmental management plan approvals.

Once fully operational, Narrabri has the potential to deliver more than half NSW’s gas demand, creating a more secure, local and affordable supply for businesses, manufacturers and families.

Santos share price snapshot

A choppy 12 months marred by volatile energy prices have led the Santos share price to register a 10% gain.

The company’s shares hit a 52-week high of $8.86 on 8 June before tumbling on the back of a gloomy economic outlook.

Listed as the second biggest energy player on the ASX, Santos commands a market capitalisation of roughly $23.59 billion.

The post Own Santos shares? Here’s what the company just announced appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• 5 things to watch on the ASX 200 on Wednesday
• ASX 200 energy shares mixed amid bearish oil price outlook
• 5 things to watch on the ASX 200 on Tuesday
• Leading brokers name 3 ASX shares to buy today

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 Scott Phillips.

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When it comes to ASX exchange-traded funds (ETFs), it can be argued that the BetaShares Asia Technology Tigers ETF (ASX: ASIA) hasn’t been the best performer of late.

Sure, ASIA units have gained a healthy 1.33% so far today. But this tech-heavy ETF remains down a painful 27.3% or so over 2022 thus far. It’s also down by more than 34% over the past 12 months. And a whopping 51.3% off of the all-time high of over $14 a unit that we saw back in February 2021.

In stark contrast, the ASX’s most popular index fund, the Vanguard Australian Shares Index ETF (ASX: VAS) is only down by 9.62% over the past 12 months. The tech-heavy BetaShares NASDAQ 100 ETF (ASX: NDQ), which is far more similar to ASIA, has lost 10.2% over the same period.

So what’s gone so wrong with the ASIA ETF?

So this fund is designed to be an Asia-based alternative to the US NASDAQ Index. According to its provider, ASIA comprises “the 50 largest technology and online retail stocks in Asia (ex-Japan)”.

Its largest weighting is towards China at almost 54% of the underlying portfolio. But other countries like Taiwan, South Korea, India and Hong Kong are also represented.

As one might expect, ASIA is dominated by Asian tech companies, These include Taiwan Semiconductor Manufacturing Company (TSMC), Chinese e-commerce giants Alibaba, JD.com and Tencent, Samsung Electronics and Meituan.

Even though ASIA has 39 underlying holdings, the ETF’s portfolio is rather concentrated as well. Alibaba and TSMC make up more than 20% of ASIA’s total weighted holdings alone. Thrown in Samsung and Tencent and we’re at almost 40%.

So if we look at the performance of these top holdings, we can probably understand why ASIA has had such a tough time of late.

TSMC shares are down a painful 31% year to date so far, probably thanks to the geopolitical tensions across the Taiwan Straight.

Alibaba shares are also down by 21.4% over this year. Samsung shares have lost just over 24%. Tencent has given up a notable 34% of its value.

So with these moves in mind, it’s not hard to see why the BetaShares Asia Technology Tigers ETF has had such a difficult time of late. No doubt investors will be hoping the tide turns soon.

The ASIA ETF charges a management fee of 0.67% per annum.

The post Why the BetaShares ASIA ETF is 50% below its former glory appeared first on The Motley Fool Australia.

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More reading

• 3 ETFs for ASX investors to buy right now
• Why I think these ASX tech shares are buys in August
• 3 ETFs for smart ASX investors in August
• 3 popular ASX ETFs for investors to buy

Motley Fool contributor Sebastian Bowen has positions in Taiwan Semiconductor Manufacturing. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended BETANASDAQ ETF UNITS, JD.com, and Taiwan Semiconductor Manufacturing. The Motley Fool Australia has positions in and has recommended BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended BetaShares Asia Technology Tigers ETF and JD.com. 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 afternoon trade, the S&P/ASX 200 Index (ASX: XJO) has followed the lead of US markets and stormed higher. At the time of writing, the benchmark index is up 0.9% to 7,056.9 points.

Four ASX shares that are climbing more than most today are listed below. Here’s why they are racing higher:

Block Inc (ASX: SQ2)

The Block share price is up almost 9% to $126.67. This is despite there being no news out of the payments company today. However, it is worth noting that its shares were on fire in the US overnight after the tech sector launched higher following softer than expected inflation data. The S&P/ASX All Technology Index is up 2.2% today.

Lake Resources N.L. (ASX: LKE)

The Lake Resources share price has jumped 14% to $1.51. A number of lithium shares are racing higher today after the softer inflation data boosted investor sentiment, particularly in higher risk assets. In addition, with Lake currently one of the most shorted ASX shares, it appears that a short squeeze could be occurring this afternoon.

Mirvac Group (ASX: MGR)

The Mirvac share price is up 3.5% to $2.16. This morning the property company delivered a full year result ahead of guidance. Mirvac reported an 8% increase in operating profit after tax to $596 million. This allowed the company to lift its full year distribution by 3% to 10.2 cents per share.

QBE Insurance Group Ltd (ASX: QBE)

The QBE share price is up 3% to $12.53. Investors have been buying this insurance giant’s shares after its half year results release. Although QBE reported a sharp decline in its profits, investors appear to be focusing more on its strong gross written premium growth, which rose 13.78% over the prior corresponding period.

The post Why Block, Lake, Mirvac, and QBE shares are racing higher appeared first on The Motley Fool Australia.

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More reading

• Why are ASX 200 tech shares flying higher on Thursday?
• Why has the Block share price exploded 9% on the ASX today?
• QBE share price lifts despite $840 million income hit
• Why is the Lake Resources share price up so much more than other ASX lithium shares today?
• Here are the 3 most heavily traded ASX 200 shares on Wednesday

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 positions in and has recommended Block, Inc. The Motley Fool Australia has positions in and has recommended Block, Inc. 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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