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Why cash is king (with Chris Cuffe) · The Money Puzzle

0:10
Speaker 1: Hello, and welcome to The Australian's Money Puzzle podcast. I'm
0:13
Speaker 1: James Kirkby. Welcome aboard everybody now today for your Easter
0:17
Speaker 1: break listening pleasure, I have a very special guest who
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Speaker 1: is Chris Cuff, a legendary fund manager de facto legendary
0:25
Speaker 1: fund manager martiad who initially came to fame almost became
0:29
Speaker 1: a household name at one stage through his success as
0:32
Speaker 1: an investor and manager at what is still the Colonial Group,
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Speaker 1: and since then he's had a portfolio of interest. You'll
0:39
Speaker 1: see him on a variety of boards. Some boards you
0:42
Speaker 1: won't see him on because they're family offices, but you
0:44
Speaker 1: would be familiar of course with UNI Super, which is
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Speaker 1: I think the fourth biggest industry fund in the country,
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Speaker 1: so that is a very big gig as you can imagine.
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Speaker 1: He's also on the board of Argyll, the listed investment company,
0:57
Speaker 1: the original of the species. You have to mention Don
0:59
Speaker 1: Bradman when you mentioned al Go, because he was once
1:02
Speaker 1: involved with that. Do you know that his passion Chris's
1:06
Speaker 1: passion is philanthropy. I have talked to him before regularly.
1:11
Speaker 1: He's got involved in some terribly interesting projects of late
1:14
Speaker 1: we're going to talk about that too, and the extent
1:16
Speaker 1: to which you may be able to access some of
1:19
Speaker 1: this if you wish to. But first I want to
1:21
Speaker 1: hear what he has to say. Needless to say, I
1:24
Speaker 1: want to hear what he says. You want to hear
1:26
Speaker 1: what he says about the markets and the conditions of
1:29
Speaker 1: the markets that were currently investing in. How are you, Chris?
1:33
Speaker 2: Very well? Thank you, James, straight.
1:36
Speaker 1: Up question, Okay, there's always periods of great uncertainty. I'm
1:41
Speaker 1: always entertained when people talk about uncertainty and how there's
1:44
Speaker 1: never as if there was never uncertainty before. I mean,
1:47
Speaker 1: COVID was pretty uncertain, GFC was pretty uncertain. But this
1:51
Speaker 1: particular period, instinctively to you, is there reasons for the
1:57
Speaker 1: every day investor to change their approach to invest in
2:00
Speaker 1: looking at the global trade crisis that we have in
2:05
Speaker 1: front of us.
2:07
Speaker 2: I don't think there's great reasons to change. I mean,
2:10
Speaker 2: I hope for every investor, if they're a true investor,
2:14
Speaker 2: they should have a plan and they should have a
2:17
Speaker 2: diversified portfolio. People ask me all the time, what do
2:20
Speaker 2: you react? How are you reacting in this time? And
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Speaker 2: I think I just check down the securities I have
2:25
Speaker 2: in my portfolio and make sure it's well diversified, because
2:28
Speaker 2: I can't pick day to day or months a month
2:31
Speaker 2: what's going to do well and what's not. And we're
2:33
Speaker 2: in a period now, you know, sometimes there's no one
2:37
Speaker 2: unknowns and now we've got unknown's unknowns, So we sort
2:42
Speaker 2: of wake up each day and just sort of work
2:44
Speaker 2: off the seat of your pants. But look, it also
2:47
Speaker 2: very much depends on whether you're running your portfolio with
2:50
Speaker 2: new money coming in, whether you're in draw down phase.
2:53
Speaker 2: There'll always be issues around that. But look, right now,
2:56
Speaker 2: I think it's a pretty good time to draw breath.
3:00
Speaker 2: Probably don't get too anxious about anything, particularly if you've
3:03
Speaker 2: got a well diversified portfolio, and really just you know,
3:09
Speaker 2: it's a strange time we're in, James. What else can
3:11
Speaker 2: we say.
3:12
Speaker 1: Would you have a hunch that the worst is over?
3:16
Speaker 2: I think the worst is over, as in the initial
3:19
Speaker 2: shock of what has happened in America at the leadership
3:23
Speaker 2: position and the fact that there are p and O
3:25
Speaker 2: guardrails on making those decisions. You know, I would have
3:29
Speaker 2: thought it's not legally possible when I first heard it
3:31
Speaker 2: that the American President can just you know, issue tariff's
3:35
Speaker 2: left right at the center without some type of emergency
3:38
Speaker 2: going on. But anyhow, they've done it, so we just
3:40
Speaker 2: have to live with that. So I think the shock
3:42
Speaker 2: of seeing the magnitude is the big thing. And now
3:45
Speaker 2: I think we'll grind for a probably a long period
3:49
Speaker 2: of time as we see the effects of maybe the
3:53
Speaker 2: base twer for ten percent. You know, it's probably going
3:56
Speaker 2: to cause inflation at least in the short term. That's
3:59
Speaker 2: probably going to put interest rates on hold at least
4:01
Speaker 2: for the short term. And then I think behind the
4:04
Speaker 2: scenes in Washington will be concession, slow concessions over time
4:10
Speaker 2: as the American people get very hurt by what's happening,
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Speaker 2: and I think that will reverberate back to their members,
4:18
Speaker 2: their elected officials, and hopefully, you know, get to the
4:22
Speaker 2: President and his men. I don't think they anticipated anything
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Speaker 2: like what's going on, and I don't think there was
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Speaker 2: a grand plan. I think it was a complete mess.
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Speaker 1: Can I ask you, when you say stable interest rates,
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Speaker 1: you mean global rates right, correct? Australian rates could fall
4:40
Speaker 1: in the short term.
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Speaker 2: You could definitely mount a case that if we get
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Speaker 2: a global recession, growth really going downhill, people losing jobs,
4:51
Speaker 2: interest rates will drop, that's definitely on the cards. But
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Speaker 2: I think none of this is going to happen immediately.
4:58
Speaker 2: There's a lot of time to play up yet to
5:00
Speaker 2: see where these things land. I think you'd be a
5:04
Speaker 2: brave person to think that the tariffs that America's put
5:09
Speaker 2: on China and China put on America again to sit
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Speaker 2: as they are, it's just impractical. You just trade between
5:16
Speaker 2: the nations will stop, and that just doesn't seem likely
5:21
Speaker 2: to me at all. So this posturing going on, we've
5:23
Speaker 2: got to wait for that to stop. But we might
5:25
Speaker 2: get what they call imported inflation. If it costs Chinese
5:30
Speaker 2: the Chinese a lot more to make the goodies that
5:33
Speaker 2: we bring into Australia, it's going to cause some inflation.
5:36
Speaker 2: But I think these are short term things. To go
5:39
Speaker 2: back to your first question, I just wouldn't be in
5:41
Speaker 2: a hurry to do anything radical right now and just
5:44
Speaker 2: let the dust settle.
5:46
Speaker 1: You're on the board of family offices and investment vehicles
5:50
Speaker 1: of some very wealthy people and families in Australia, so
5:54
Speaker 1: anything that they are doing that would give our everyday
5:58
Speaker 1: listeners an insight to sort of the tactical response to this.
6:02
Speaker 1: Are they putting more money into gold? Are they lifting
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Speaker 1: their cash? Are their bargain hunting? Is there anything you
6:08
Speaker 1: can insight you could give us as to how they're behaving.
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Speaker 2: Well, certainly the groups I'm involved with, I think it's
6:14
Speaker 2: as a generalization, it's fair to say they're just letting
6:18
Speaker 2: cash build up right now. And unless you know, there's
6:21
Speaker 2: something peculiar about their liabilities or there some external factor,
6:25
Speaker 2: but it's really let it build up. Don't have a
6:28
Speaker 2: fear of missing out if anything, right now, the fear
6:32
Speaker 2: might be the other way around. The people. We are
6:36
Speaker 2: all talking about the Australian dollar. I mean it was
6:39
Speaker 2: a week ago it was at fifty nine cents. Today
6:42
Speaker 2: it's at sixty four cents. So I did see some
6:46
Speaker 2: groups put on hedges very quickly, which not everybody can do,
6:51
Speaker 2: although there are easily accessible instruments in the market that
6:55
Speaker 2: any investor can do for that. And we've seen the
6:58
Speaker 2: currency already firm from the US Australian dollar a firm
7:02
Speaker 2: from fifty nine to sixty four, and that's a very big,
7:06
Speaker 2: very big change. You know, the urgency to do perhaps
7:10
Speaker 2: do something about the currencies calm down a little, though.
7:14
Speaker 2: Sixty four cents in a long term sense is still
7:18
Speaker 2: well below the long term average, which is around seventy cents,
7:22
Speaker 2: which it always seems to head back to at some
7:24
Speaker 2: stage or another.
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Speaker 1: We had people on the show saying, you're better off
7:28
Speaker 1: being unheaged because the US is the heart of the machine,
7:32
Speaker 1: heart of the markets. When the US markets fall, if
7:36
Speaker 1: we all have more exposure to the US than we
7:38
Speaker 1: ever had before, which is probably the case for both
7:40
Speaker 1: our listeners and a lot of the big super funds,
7:43
Speaker 1: that when the US markets fall, the US dollar, the
7:45
Speaker 1: currency works your way. It's in your favor because you're
7:50
Speaker 1: basically when the Australian dollar is falling as it has
7:52
Speaker 1: so far, you're cushioned. You think that might not be
7:56
Speaker 1: the case going forward.
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Speaker 2: Well, look, I would say my position and those that
8:01
Speaker 2: I work with, it's generally when you're buying overseas securities
8:07
Speaker 2: that be they manage funds or direct shares or whatever
8:10
Speaker 2: is to have it unheitched. So that's default position. But
8:14
Speaker 2: we have seen in history where you get very large
8:18
Speaker 2: aberrations and look, I remember it's got I remember once
8:23
Speaker 2: when the Australian dollar got to forty five cents to
8:26
Speaker 2: the US dollar, and I remember, yeah, and I remember
8:30
Speaker 2: traveling when the Australian dollar got to one hundred and twenty.
8:34
Speaker 2: So you know what the out of bounds, you know,
8:36
Speaker 2: if it's got a five in front of it for sure,
8:39
Speaker 2: or a nine in front on the other end, they're
8:43
Speaker 2: probably times where you could opportunistically probably take advantage of
8:48
Speaker 2: that with great likelihood of success, as long as you
8:52
Speaker 2: don't pick your time frame.
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Speaker 1: Okay, right, And just on the building up the cash,
8:57
Speaker 1: can you give people any idea? You know a lot
9:00
Speaker 1: of people have serf managed super funds. They're always been
9:03
Speaker 1: criticized for having too much cash. And then the big
9:06
Speaker 1: super funds have, compared to the smsfs, much lower cash levels.
9:11
Speaker 1: With these family companies you have, it's the extent you
9:13
Speaker 1: can answer this, what percentage would they generally have in cash?
9:16
Speaker 1: What would be a neutral level? And then what might
9:19
Speaker 1: they be building up to at the moment.
9:22
Speaker 2: Well, first all, to make it clear to the big
9:24
Speaker 2: super funds, they always have it. I serve with one
9:27
Speaker 2: of them for many years, as I still do. They
9:29
Speaker 2: always have let's use the term liquidity rather when they
9:33
Speaker 2: must have it. Of course they must have liquidity because
9:35
Speaker 2: they've got people coming and going all the time, but
9:38
Speaker 2: they have sort of modest cash levels actual cash probably
9:42
Speaker 2: compared to many individuals with their own self managed super fund. Look,
9:46
Speaker 2: I don't know if there's a common level, James. I
9:49
Speaker 2: like to think, in any event, if you had sort
9:52
Speaker 2: of ten to twenty percent of cash at most times,
9:56
Speaker 2: you know, maybe that's useful to jump on things. Other
9:59
Speaker 2: people like to be invested all the time. As long
10:01
Speaker 2: as it's liquid, you can get money out and rotate
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Speaker 2: to something else. But I don't know if there's one
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Speaker 2: one better way than not, but there's Look, there's an
10:10
Speaker 2: increasing number of securities that give you, i think, both
10:15
Speaker 2: great diversification and some liquidity, so you can take advantage
10:20
Speaker 2: of things. But it also, as I said before, it
10:22
Speaker 2: depends very much on what stage you're at. If you've
10:25
Speaker 2: got your own self managed super fund and you're a
10:27
Speaker 2: retiree and you're drawing money off it each year, now,
10:30
Speaker 2: so you know it's got to keep shrinking over time,
10:33
Speaker 2: you'll probably have a higher amount of cash so you
10:35
Speaker 2: don't have to sell down securities in volatile stressed times.
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Speaker 1: And these listed securities that give you liquidity and versification.
10:46
Speaker 1: Are you thinking of ETFs.
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Speaker 2: It could be an ETF so, but it could be
10:51
Speaker 2: there's plenty of ETFs. People often mix up a little
10:56
Speaker 2: bit many ETFs. Most ETFs are what they call pass
11:00
Speaker 2: as you've said many times on your show, they invest
11:03
Speaker 2: in the index of whatever they're exposed to. But there's
11:06
Speaker 2: also an increasing number of active ETFs. They're just happen
11:11
Speaker 2: to be managed funds, managed by an active manager who's
11:15
Speaker 2: trying to do better than the index, and they happen
11:18
Speaker 2: to be listed on the stock market. You can get
11:21
Speaker 2: in and out at nta net asset value, just like
11:26
Speaker 2: you can for normal shares. And I have a preference myself.
11:32
Speaker 2: Where a market is what I call thin, like Australia,
11:37
Speaker 2: I have a preference to be in actively managed funds
11:40
Speaker 2: because but in overseas, I'm very satisfied with ETFs as
11:46
Speaker 2: well as active funds, simply because those markets offshore are
11:51
Speaker 2: much wider, they're much bigger, they're well diversified. Whereas Australia,
11:55
Speaker 2: as most people know, you the heavyweights. You're exposed a
12:00
Speaker 2: handful of banks, a few miners, and a couple odds
12:02
Speaker 2: and ends on the outside. So I find Australian ETFs
12:06
Speaker 2: are a little bit risky for.
12:07
Speaker 1: Me, okay, because half the market is banks and miners. Yeah, okay,
12:12
Speaker 1: So we can't have you on without asking you the
12:15
Speaker 1: conventional thinking. And that may not be what you're thinking,
12:18
Speaker 1: of course, but convention I'm thinking is, you know, there's
12:21
Speaker 1: a swing, there's a lot of fear in the market.
12:24
Speaker 1: You know that's proven, and the vix is elevated, so
12:27
Speaker 1: people are going back into like supermarket stocks went up
12:31
Speaker 1: during those scary days a few days ago. The bank's
12:34
Speaker 1: coming with bank I mean, is just basically unmoved. In
12:37
Speaker 1: the middle of all this, gold is going steadily higher
12:41
Speaker 1: and people are looking at those conventional, traditional defensive stocks.
12:48
Speaker 1: Just now, what do you think of that approach?
12:52
Speaker 2: Well, it's an interesting conundrum again listening, I'm a regular
12:56
Speaker 2: listener to your show. There's always the issue that if
13:00
Speaker 2: you look at the Commonwealth Bank, everybody says it's very
13:03
Speaker 2: highly priced, has been for a long time. It's come
13:06
Speaker 2: down a bit, but it's still at a healthy price.
13:10
Speaker 2: And does that mean you should sell the thing and
13:12
Speaker 2: rotate into something else. That's the difficult thing because you've
13:16
Speaker 2: already been in the thing as opposed to if you've
13:19
Speaker 2: got fresh money. So as you've made the point I
13:23
Speaker 2: think last week or the week before, if you've been
13:25
Speaker 2: in the Commonwealth Bank since it was say twenty dollars,
13:27
Speaker 2: the dividend yield you're getting off that cost base is
13:32
Speaker 2: magnificent and you might find it very hard to see
13:35
Speaker 2: a reason why you'd want to sell it. And of
13:37
Speaker 2: course there's always tax when you sell things. But if
13:41
Speaker 2: you said if I was starting myself managed super fun
13:44
Speaker 2: today with a fresh pile of cash, what would I do.
13:50
Speaker 2: I certainly would be looking at the value of stocks.
13:54
Speaker 2: I probably would not be investing big time in the banks,
13:59
Speaker 2: just because they've gone up so much. But in my
14:02
Speaker 2: starting point, as I've said a few times, I'd be
14:04
Speaker 2: thinking of a diversified portfilo across local shares, international shares.
14:09
Speaker 2: I always like a bit of private equity. I always
14:12
Speaker 2: have plenty of private credit. I really do believe in
14:15
Speaker 2: that sector. And there are other weird and wonderful investments
14:19
Speaker 2: out there that I like to give me a great
14:23
Speaker 2: way to sleep at night.
14:25
Speaker 1: Okay, actually I have in front of me a pigraph
14:29
Speaker 1: of the accid allocation of your main of your flagship operation.
14:34
Speaker 1: Really the aps Foundation. We'll take a break, we'll come back,
14:37
Speaker 1: we'll pick up on this theme, but we'll also give
14:40
Speaker 1: Chris the opportunity to talk about what he wants to
14:42
Speaker 1: talk about more than anting as, which is this land
14:44
Speaker 1: to pick fund. Okay, back in a moment. Hello, Welcome
14:59
Speaker 1: back to The Australian's Money Puzzle podcast Easter a special
15:03
Speaker 1: James Kirby here with Chris Kuff. It's a great time
15:05
Speaker 1: to have Chris on, one of the best known fund
15:08
Speaker 1: managers in the land. Now, Chris, I've mentioned that the
15:12
Speaker 1: investors listening to the show will know UNI Super and
15:14
Speaker 1: they'll know Argo et cetera. They listed investment company and
15:18
Speaker 1: other operations you're involved in more recently and more recentimes,
15:22
Speaker 1: you got a lot of time to philanthropy, active philanthropy,
15:25
Speaker 1: and there's two we've talked about the Third Link Fund
15:29
Speaker 1: on the before, which is an unlisted fund that you're
15:32
Speaker 1: involved with that the retail investor can pay, maybe getting
15:36
Speaker 1: them for about twenty thousand I think is the minimum.
15:38
Speaker 1: And that's a fund where there is a strong philanthropic
15:42
Speaker 1: element to it. And then separately, tell me if this
15:45
Speaker 1: is wrong. You were involved with the Australian Philanthropic Services Group,
15:49
Speaker 1: and they have a very big fund which is pretty
15:52
Speaker 1: close to becoming the biggest fund charitable fund in the country.
15:55
Speaker 1: It's called the Australian the APS Fund. And how much
16:00
Speaker 1: is under management there?
16:01
Speaker 2: Chris Well, okay, if I just run through quickly how
16:05
Speaker 2: each works. A Third Link Growth fund, it's been going
16:07
Speaker 2: for about sixteen years. It's an Australian equity fund. All
16:12
Speaker 2: the fees go to charity. It is a what's called
16:16
Speaker 2: a fund of funds. So my job is to choose
16:19
Speaker 2: fund managers underneath the fund who are managing Australian equities
16:25
Speaker 2: who I think are best in breed. That's my opinion
16:28
Speaker 2: of best in breed, and they manage the money. We
16:32
Speaker 2: try to get our investors an excellent return. We do
16:35
Speaker 2: the best we can. I think the returns on the
16:38
Speaker 2: Third Link website it's been slightly better than the Australian
16:41
Speaker 2: share market since this inception, and so far we've given
16:46
Speaker 2: twenty three million dollars to charity over the sixteen years.
16:50
Speaker 2: It's been a lot of fun. And all those fund
16:53
Speaker 2: managers do it for free. I do it for free,
16:55
Speaker 2: and our investors I think like the fact that they're
16:58
Speaker 2: both making money and their fees they're paying. They've still
17:02
Speaker 2: got to pay a fee, but that fee is going
17:04
Speaker 2: to charity. So that's the third Link Growth Fund, which
17:08
Speaker 2: is a minimum of twenty thousand dollars Australian equity fun
17:12
Speaker 2: very specific and it's an active fund, so it's out
17:15
Speaker 2: there trying to beat the index. Okay. The second organization
17:19
Speaker 2: you mentioned is fairly unique, so it's called Australian Philanthropic Services.
17:25
Speaker 2: It's actually a charity I set up about fourteen years
17:29
Speaker 2: ago to help people do philanthropy better. And it's a
17:34
Speaker 2: big word, but philanthropy is an increasing part of the
17:38
Speaker 2: Australian wealth management landscape, particularly with the massive intergenerational wealth
17:45
Speaker 2: transfer that's going on in the trillions of dollars. Philanesbury
17:49
Speaker 2: is really growing. Anyhow, I decided fourteen years ago it's
17:53
Speaker 2: set up an organization where you could really do engage
17:57
Speaker 2: in philanthropy with the help of experts and do it
18:01
Speaker 2: hopefully in a much better way. So we run products.
18:05
Speaker 2: We have a couple of products, so we set up
18:07
Speaker 2: and administer what's called ancillary funds and they're just like superannuation.
18:14
Speaker 2: Your listeners will know in superannuation there's two types of
18:18
Speaker 2: superannuation funds in the market. You can have a self
18:21
Speaker 2: managed super fund that's a private super fund, or most
18:25
Speaker 2: of the population are in public offer fund whether it's
18:28
Speaker 2: an industry fund or whatever. It's exactly the same. In
18:31
Speaker 2: the philanthropy industry, we have these vehicles called ancillary funds,
18:36
Speaker 2: and you can set up a private ancillary fund just
18:41
Speaker 2: like self meaning super very similar structure, or you hit
18:45
Speaker 2: your car to an existing public ancillary fund and hold
18:50
Speaker 2: an account within that fund. And so we are the
18:53
Speaker 2: leading organization in Australia that helps people go into those
18:58
Speaker 2: vehicles and help them with their general giving. And between
19:02
Speaker 2: those things, those ancillary funds we ad minister about two
19:06
Speaker 2: and a half billion dollars and our clients give currently
19:10
Speaker 2: around one hundred and sixty million dollars per annum to
19:13
Speaker 2: charity out of those funds. So it's been an enormously
19:19
Speaker 2: beneficial business to set up again as a charity for
19:23
Speaker 2: the Australian public.
19:24
Speaker 1: So I'm an investor and I'd like to be involved
19:27
Speaker 1: in philanthropy, and I say there's two ways in here.
19:31
Speaker 1: There's a third link fund, which is just a straight
19:33
Speaker 1: fund that's a twenty grand minimum for the average retail investor.
19:37
Speaker 1: Anyone can do it, no strings attached, and that fund
19:39
Speaker 1: has done okay, it seems to me you're this bigger fund,
19:43
Speaker 1: which unfortunately is higher up the scale to get into
19:46
Speaker 1: as doing better. That is, its returns against its benchmarks
19:51
Speaker 1: has been better. And we'll talk about that in the
19:53
Speaker 1: moment as to why. But in any event, so if
19:55
Speaker 1: I wanted to, if I wanted to get involved in this,
19:58
Speaker 1: what is the rough bottom minimum in which I can
20:00
Speaker 1: part play here in this particular sandpit. How much would
20:04
Speaker 1: I need to put in?
20:06
Speaker 2: So let's just back off one slight bit here. With
20:09
Speaker 2: Australian Philanthropic Services Foundation, the big public ancillary fund I run.
20:17
Speaker 2: We don't necessarily call them investors that come in. It's
20:20
Speaker 2: more philanthropists. So if you would like to be involved
20:23
Speaker 2: with philanthropy, you can open an account in the APS
20:27
Speaker 2: Foundation for a minimum of forty thousand dollars. You get
20:31
Speaker 2: one hundred percent tax deduction for that forty thousand dollars
20:35
Speaker 2: in the year in which you put the money in,
20:37
Speaker 2: or indeed you could spread the tax deduction over five
20:40
Speaker 2: years if that's better for you. So you put your
20:43
Speaker 2: money in the foundation, and you are then attached to
20:47
Speaker 2: a big pool of assets and those assets are invested
20:51
Speaker 2: tax free. There's no tax payable by the foundation. And
20:55
Speaker 2: then each year we write out to our people clients
21:00
Speaker 2: in there and say you need to now here's your
21:04
Speaker 2: proportionate balance of this big pool. You need to give
21:07
Speaker 2: away four percent of that to charity. So you just
21:11
Speaker 2: tell us which charity you want to give the money
21:14
Speaker 2: to and the way it goes. So the magic that
21:18
Speaker 2: it's the very simply stated, it's quite a unique vehicle
21:22
Speaker 2: these it's broken the nexus between the timing of the
21:26
Speaker 2: tax deduction and the timing of giving to charity. You
21:30
Speaker 2: get the tax reduction all up front. The giving to
21:33
Speaker 2: charity happens over many years, or you can do it
21:36
Speaker 2: quicker if you want, but you can take your time.
21:39
Speaker 2: You can because often when you give to get a
21:42
Speaker 2: tax deduction for giving to charity. It'd be smart if
21:45
Speaker 2: you could time that with events which might cause you
21:48
Speaker 2: tax like selling your business or selling your CBA shares,
21:53
Speaker 2: or getting a bonus from your employer or something you
21:56
Speaker 2: get a taxable of anything. Chee, I wouldn't mind off
21:58
Speaker 2: setting that TAXI. You could perhaps put a lump sum
22:01
Speaker 2: over in the philanthropic vehicle, and then take your time
22:05
Speaker 2: to think about what charities you want to give too.
22:07
Speaker 2: Over time, we've seen wonderful growth in this area, and
22:11
Speaker 2: it's really changed the dynamics of a lot of families
22:14
Speaker 2: as well, because they involve their children in giving.
22:17
Speaker 1: Whereas once upon a time someone might have said, oh,
22:20
Speaker 1: we should really give something to charity, and they'd pick
22:22
Speaker 1: two or three they like and they'd hand it over
22:23
Speaker 1: and it would be tax deductible, but it would be
22:26
Speaker 1: unformed as such. What you've done is much more sophisticated
22:29
Speaker 1: thing where the person says, okay, let's think long term.
22:32
Speaker 1: We go into this fund aps and then the management
22:37
Speaker 1: of that fund is you and your colleagues, and it
22:42
Speaker 1: goes it has been doing very well, and you're able
22:45
Speaker 1: to donate then on an ongoing basis on what you're
22:49
Speaker 1: making on your initially depositive you like in that fund,
22:52
Speaker 1: and it must be four percent each year. This is
22:55
Speaker 1: probably why you need a minimum of forty thousand dicpresum
22:59
Speaker 1: because you need to have a four percent is going
23:01
Speaker 1: to go out to do it every year anyway, And
23:03
Speaker 1: you didn't say you want you stop me calling it
23:06
Speaker 1: investors for the simple reason that it's not it's it's
23:08
Speaker 1: philanthropic in nature. And that means, Chris, if I've got
23:12
Speaker 1: it right, that if listeners, you are interested in this
23:15
Speaker 1: and you have the capacity to do so. It's ideal
23:18
Speaker 1: of course, when people as you see liquidity event as
23:20
Speaker 1: they call it in the trade. If you were about
23:22
Speaker 1: to sell a business, if you're about to inherit your
23:24
Speaker 1: uncle's house or whatever. But you can't, for instance, use
23:28
Speaker 1: you can't take forty grand out of your or one
23:30
Speaker 1: hundred and forty grand out of your super and put
23:32
Speaker 1: it in Chris, can you, because that crunches up against
23:35
Speaker 1: the best interest duty in super? If I've got that right, you.
23:38
Speaker 2: Can in a way in the sense of if you're
23:41
Speaker 2: able to access your super so you'll pass your preservation age. Yes,
23:46
Speaker 2: and you're able to access your super so you can
23:48
Speaker 2: freely take your super into your own name. And then
23:50
Speaker 2: you might think, I've got enough money now that I'd
23:53
Speaker 2: like to put some money. I'd like to get involved
23:56
Speaker 2: in philanthropy, particularly while you're alive. This is the most
24:01
Speaker 2: important thing in these vehicles.
24:03
Speaker 1: You could be alive, but you just have to be retired.
24:05
Speaker 1: You couldn't be an accumulation.
24:07
Speaker 2: Please, Oh no, it's not something that you can just
24:11
Speaker 2: tell you super fund, put some money over here. The
24:14
Speaker 2: two are quite very separate, but sort of the type
24:18
Speaker 2: of person who might go into this tends to be
24:22
Speaker 2: later in life. They tend to be financially secure. They
24:27
Speaker 2: want to help society, they want to do it while
24:30
Speaker 2: they're alive. Putting money into this sort of holding pattern
24:34
Speaker 2: of a fund called an ancillary fund is a great way.
24:37
Speaker 2: As we said, they can time their tax deduction, but
24:40
Speaker 2: then the giving can go on for many many years later.
24:44
Speaker 2: And in fact people often use it upon their passing,
24:48
Speaker 2: which there's a thing in the way tax works is
24:51
Speaker 2: quite interesting. If you were lucky enough to buy your
24:55
Speaker 2: Common Warf Bank shares at five dollars. We always pick
24:58
Speaker 2: on the Common Warf Bank as such well run institution,
25:01
Speaker 2: I should say. And if on your passing your state
25:05
Speaker 2: was then holding those shares, then all things being equal,
25:09
Speaker 2: if your a state sold those shares, there would be
25:13
Speaker 2: a massive capital gain that the state would have to pay. However,
25:18
Speaker 2: if you had donated, if you donate those shares through
25:22
Speaker 2: your will to a foundation, say that was in existence already,
25:29
Speaker 2: then there's no tax to the state at all, and
25:32
Speaker 2: the foundation then will not pay tax because the foundation
25:36
Speaker 2: is a tax free vehicle. So it's a magnificent way
25:40
Speaker 2: for people who have stored wealth beyond their needs, beyond
25:44
Speaker 2: what they want to provide for their children, and still
25:47
Speaker 2: don't want to pay tax. I love the idea of
25:49
Speaker 2: not paying tax even when I die.
25:53
Speaker 1: Yes, no, I imagine many people would aspire to do that, Chris.
25:57
Speaker 1: And it's a terrific It's a terrific structure. And it's
26:00
Speaker 1: not an accident. Folks that I've I have that have
26:03
Speaker 1: had at least once or twice a year brought up
26:05
Speaker 1: this because to me, as a with an investor's mind,
26:09
Speaker 1: this structure and by the way, to be fair, APS
26:11
Speaker 1: is of course not the only operation in this area,
26:14
Speaker 1: but it is one of the biggest, and it's a
26:17
Speaker 1: very smart way, a kind of professional way to approach
26:22
Speaker 1: philanthropy in a more strategic and tax effective manner. Why
26:26
Speaker 1: why not do that if you do that in every
26:28
Speaker 1: other area of life. Just briefly, Chris, So, the big fund,
26:32
Speaker 1: the APS Fund, what was how much did you say
26:35
Speaker 1: it has under management?
26:36
Speaker 2: Now? Okay, So the APS Foundation, the public ansigtery fund
26:41
Speaker 2: we run is around about the four hundred million dollar mark,
26:45
Speaker 2: so it's large. I think by the end of this
26:47
Speaker 2: decade it'll be a billion dollars probably, So it's a
26:51
Speaker 2: large and growing investor.
26:54
Speaker 1: So I want to tell the listeners what's in it.
26:56
Speaker 1: You know, what you do, so they get a picture
26:58
Speaker 1: of what goes on with the money. So the so
27:00
Speaker 1: the allocation folks inside this one's really interesting. It's a
27:02
Speaker 1: bit like when you can look into the future fund.
27:04
Speaker 1: You know, it's very useful. So how it works is
27:06
Speaker 1: twenty two percent in shares local, seventeen percent in shares international,
27:12
Speaker 1: a pretty chunky seventeen percent in private equity, then thirteen
27:17
Speaker 1: percent in what they call interest bearing securities. The rest
27:20
Speaker 1: then is scattered between property, venture capital, and what they
27:25
Speaker 1: call miscellaneous growth assets and liquid's been seven percent. Okay now, Chris,
27:30
Speaker 1: seventeen percent of this fund is private equity. Can I
27:34
Speaker 1: just ask you, a lot of people on the shore
27:36
Speaker 1: are every day investors are only getting to know private equity,
27:38
Speaker 1: and it's been put in front of them for the
27:39
Speaker 1: first time. It's been put in front of them at
27:42
Speaker 1: this time for a variety of reasons. This sense that
27:46
Speaker 1: the banks are withdrawing. I don't know if that's completely true.
27:50
Speaker 1: There's a sense that the hybrid market has been is
27:52
Speaker 1: being wound up, and so people are looking for income
27:55
Speaker 1: and they're putting private equity funds have been put in
27:57
Speaker 1: front of people in a listed form. How do you
28:01
Speaker 1: think the uninitiated should approach this very important area that
28:05
Speaker 1: takes like seventeen percent of your successful fund, which, by
28:08
Speaker 1: the way, folks, is just to give you an idea
28:11
Speaker 1: of how it's going. It has a target return, very
28:14
Speaker 1: like at the future fund to see inflation plus four
28:17
Speaker 1: percent is what it looks for. And for instance, like
28:19
Speaker 1: last year the one year did thirteen. But private equity, right,
28:23
Speaker 1: we'd all love to be in it in a successful manner.
28:27
Speaker 1: But I worry Chris, that kind of lead to the
28:29
Speaker 1: party for a lot of everyday investors and they're going
28:31
Speaker 1: to go into second red stuff.
28:34
Speaker 2: Yes, there's a couple of things you said that James,
28:37
Speaker 2: which I'll pick up on. First of all, you said
28:39
Speaker 2: it's a bit like a major superannuation fund the way
28:42
Speaker 2: we've we sort of have a target return. So for
28:46
Speaker 2: this big portfolio, I'm trying to get a return of
28:50
Speaker 2: inflation plus four percent per annum measured over rolling seventy
28:55
Speaker 2: year periods. You won't get that every year. Some years
28:58
Speaker 2: will be negative, some years will be twice as much.
29:00
Speaker 2: But I'm trying to do it over rolling seven year periods,
29:04
Speaker 2: and so far that's been successful. So if you're trying
29:08
Speaker 2: to get inflation plus four percent, you're not going to
29:11
Speaker 2: get that by investing in term deposits. You have to
29:14
Speaker 2: take a growth approach and you have to have time
29:18
Speaker 2: on your side. So this pool of money is a
29:21
Speaker 2: growing pool. People have parted with their money already into
29:25
Speaker 2: it to get the tax duction and to give to charity.
29:28
Speaker 2: They can't take the money back, so we know it's
29:31
Speaker 2: a long term growing pool. So that means with a
29:35
Speaker 2: rolling a target of rolling seven year periods and very
29:40
Speaker 2: patient capital. On the other side, I can be very
29:43
Speaker 2: patient in the way I invest. Now you talked about
29:47
Speaker 2: private equity. There, I think in the portfolio you'll see
29:51
Speaker 2: two segments that are reasonably large. You'll see private credit
29:56
Speaker 2: and private equity. Private credit I might mention quickly first
30:01
Speaker 2: and then come on to the equity because I know
30:04
Speaker 2: you talk about private credit a bit on your show.
30:07
Speaker 2: Private credit is a very important sector now. I think
30:11
Speaker 2: it's sort of had a bad name at the start
30:13
Speaker 2: a bit that. Of course, it really evolved from property
30:17
Speaker 2: development and construction, which is risky the best of times,
30:21
Speaker 2: but can be very risky when interest rates arising and
30:24
Speaker 2: the economy is not doing well. But private credit is
30:27
Speaker 2: very wide now across very white array of sectors. There's
30:32
Speaker 2: many managers in Australia there as well over one hundred managers.
30:35
Speaker 2: And you've got to understand if you looked at the
30:38
Speaker 2: banks twenty years ago, two thirds of their borrowing book
30:43
Speaker 2: the money they lend were to businesses and one third
30:46
Speaker 2: to home owners. These days it's the reverse they like.
30:50
Speaker 1: So they really have with drawn Chris, they really.
30:52
Speaker 2: Have drawn out of the market and the appet yeah,
30:57
Speaker 2: but the appetite for a business to borrow doesn't change.
31:01
Speaker 2: They just have to go to a different group and
31:03
Speaker 2: probably pay a bit more to be able to access
31:06
Speaker 2: the capital they need to expand. So private credit very
31:10
Speaker 2: important sector, very important to be to understand what the
31:15
Speaker 2: fund is invested in, and the experience of the investment
31:19
Speaker 2: team is really vital, and including how many securities they
31:24
Speaker 2: have in their portfilo is very vital. These inevitably, some
31:29
Speaker 2: loans will go bad, just like they do in banks.
31:32
Speaker 2: That's why banks provided for loans, so they do go
31:35
Speaker 2: Some of them do go bad, but good. A well
31:37
Speaker 2: run private equity fund is a cornerstone in my portfilo always,
31:44
Speaker 2: and you can't catch your normally in those things. They're
31:47
Speaker 2: not liquid like money in the bank. You know, if
31:51
Speaker 2: you want to get your money out of a private
31:53
Speaker 2: equity fund, it's at best you could do it quarterly.
31:57
Speaker 2: Maybe some of it, maybe not all of it. We
32:00
Speaker 2: shouldn't think of it as highly liquid, but it's somewhat liquid.
32:04
Speaker 2: The position is very different with private equity, so to
32:08
Speaker 2: be clear to those listeners of yours that don't know
32:11
Speaker 2: private equity by its nature. Instead of buying shares on
32:15
Speaker 2: the stock market, these are shares in companies that don't
32:19
Speaker 2: trade on the stock market. And generally speaking I do
32:22
Speaker 2: that through managers who specialize in that area. But the
32:27
Speaker 2: general way they will go about it is that they
32:30
Speaker 2: will launch a fund and they'll lock your money up.
32:33
Speaker 2: You commit to it, they'll lock it up for about
32:36
Speaker 2: ten years, could be less, and they spend half their
32:39
Speaker 2: time investing the money and the other half selling it down.
32:43
Speaker 2: But what we do see in the numbers all the
32:46
Speaker 2: time is that private equity isn't that good on average.
32:50
Speaker 2: You have to be with the top quartile manager to
32:54
Speaker 2: make good returns there. And the trouble with that for
32:57
Speaker 2: most on the street people, if I call it, is
33:01
Speaker 2: that the minimums are too high so they can't get
33:04
Speaker 2: in those funds. But the minimums have been coming down.
33:07
Speaker 1: Yes, I've been waiting for someone to I take Olipse
33:10
Speaker 1: that on the show and that is it. That is it,
33:14
Speaker 1: And I said, led to the party at the start forks,
33:16
Speaker 1: but I met. What I meant was that that everyone
33:19
Speaker 1: will stand up and they'll give presentations and how terrific
33:21
Speaker 1: private equity has been, And of course it has if
33:25
Speaker 1: you happen to be, you know, a multi millionaire that
33:27
Speaker 1: was with an extremely expensive financial advisory who got you
33:31
Speaker 1: in the early days to the best ones. But as
33:33
Speaker 1: Chris says, outside that top quarter, different business altogether.
33:37
Speaker 2: Very hard. We hope, you know, we were lucky in
33:40
Speaker 2: this fund. You hope every now and then, in these
33:43
Speaker 2: private companies you own, you might hit a little gold mine.
33:48
Speaker 2: You know, you might hit a canber. You might hit
33:50
Speaker 2: a canber. If your listeners know it a great Australian
33:54
Speaker 2: success story. It's already up two hundred and fifty times
33:58
Speaker 2: what we paid for it. I wish we had a
34:01
Speaker 2: lot more.
34:02
Speaker 1: Yeah, but I bet you there was two hundred and
34:04
Speaker 1: forty nine that didn't do.
34:05
Speaker 2: It exactly right. Private credit is very liquid and as
34:11
Speaker 2: just a repeat again, you really do have to be
34:13
Speaker 2: with a well regarded manager, and you know, the style
34:18
Speaker 2: of how they invest is very important. And a lot
34:20
Speaker 2: of these private equity groups they've got almost too big,
34:24
Speaker 2: so they keep investing bigger and bigger amounts. You know.
34:28
Speaker 2: That might suit some of them, but I prefer those
34:31
Speaker 2: that are more in what I call the mid market,
34:34
Speaker 2: where I think you can actually add a lot of
34:37
Speaker 2: value and not just value with leverage. Often private credit
34:42
Speaker 2: is criticized quite rightly that they often will invest in
34:47
Speaker 2: a business that's got good cash flows and they'll leverage
34:51
Speaker 2: up the business, which is fine until it's not fine.
34:55
Speaker 2: It's not fine when interest rates are eyes interesting.
34:58
Speaker 1: All right, folks, we're going to take a short break.
35:00
Speaker 1: We are running out of time, but because it was
35:01
Speaker 1: an easter, I thought we could go a little bit longer.
35:04
Speaker 1: We'll be back with Chris. We're just going to have
35:06
Speaker 1: one or two questions which I'd really like to hear
35:08
Speaker 1: what he has to say back in the moment. Hello,
35:21
Speaker 1: Welcome back to the Money Puzzle podcast. James Kirby here
35:24
Speaker 1: with Chris Cuff. All right, now a couple of co questions, Chris,
35:28
Speaker 1: just to hear what your instinctive reaction to these, So
35:32
Speaker 1: Raymond asks. Basically, he says, we had talked about how
35:37
Speaker 1: it was good not to be hedged. It was certainly
35:39
Speaker 1: not good not to be hedged during the most recent
35:43
Speaker 1: American drop where they had that desperate day where they
35:47
Speaker 1: had the worst day since twenty twenty because of the
35:50
Speaker 1: weaker Australian dollar. But as he makes the point that
35:54
Speaker 1: when things turn around, an on hedged position exposes Australians
35:59
Speaker 1: to a strength Australian dollar, even when market sentiment improves
36:04
Speaker 1: and you have increasing international equities across the board, both
36:09
Speaker 1: private investors and institutional vestors. So he says, hedging isn't perfect,
36:13
Speaker 1: but it reduces exposure to currency fluctuations. I imagine you
36:16
Speaker 1: don't have anything to disagree with that. We've more or
36:19
Speaker 1: less covered that at the start of the show. There,
36:21
Speaker 1: all right, Andrew has two really good questions. The first one,
36:24
Speaker 1: he says, Chris, is at the beginning of a global
36:28
Speaker 1: at the beginning of a global market meltdown, before the
36:32
Speaker 1: interest rates have been cut, is it broadly a good
36:36
Speaker 1: or bad time to consider bonds or bond dtfs? WHOA Now,
36:40
Speaker 1: you see when people like you talk about bonds, you're
36:43
Speaker 1: talking about bonds in this sense of buying them one
36:46
Speaker 1: by one and selecting them. But for everyday investors, their
36:50
Speaker 1: way into bonds really as bond dtfs and bond dtfs
36:55
Speaker 1: have not been great really in this market for a
36:58
Speaker 1: variety of reasons, for most years of recent years. What's
37:02
Speaker 1: your What do you say to everyday investors wh'll see
37:05
Speaker 1: I should have bonds on my way in as ETFs?
37:08
Speaker 2: Well, I guess the first thing was interesting that Andrews says,
37:11
Speaker 2: at the beginning of a global market meltdown, would it
37:14
Speaker 2: be good to do this stuff? If someone could ring
37:17
Speaker 2: the bell we know when the beginning is story about
37:22
Speaker 2: all the mice gathering round and saying if we just
37:26
Speaker 2: tie the bell to the cat's neck will know when
37:28
Speaker 2: it's coming. Of course, no mouse is going to be
37:32
Speaker 2: game to do that, so I look, I'm not a
37:36
Speaker 2: fan at all of pulled vehicles for bonds, which include ETFs.
37:43
Speaker 2: Now others may think differently. I'm just not a fan
37:47
Speaker 2: because I feel in those areas you your health is
37:51
Speaker 2: very dependent on the other people in the fund with you.
37:55
Speaker 2: If they start to panic and want to come out
37:57
Speaker 2: of the farm, there could be unintended cap gains because
38:01
Speaker 2: the manager of the fund might have to sell bonds
38:04
Speaker 2: and that might realize losses as well as gains. I
38:08
Speaker 2: just don't like the idea of holding hands in these things,
38:11
Speaker 2: so I always prefer to buy. If I want to
38:15
Speaker 2: be in fixed intra securities down in this sort of area,
38:20
Speaker 2: I like to buy them individually and own them individually,
38:24
Speaker 2: and probably in the main think about holding them until
38:28
Speaker 2: they mature, so I don't have to worry about the
38:33
Speaker 2: you know, the market value of these things going up
38:35
Speaker 2: and down. But of course, so your.
38:38
Speaker 1: First approach is to buy it as for its running yield.
38:41
Speaker 2: Yes, that's definitely right. But Australia has a very immature
38:46
Speaker 2: market in this sense, so it's very hard to sort
38:49
Speaker 2: of do that, particularly for investors with smaller amounts. If
38:53
Speaker 2: you're a large investor like UNI Super or Australian Super,
38:57
Speaker 2: you can go into the market, buy Australia in bonds
39:00
Speaker 2: or international bonds one by one and tuck them away
39:04
Speaker 2: and just enjoy receiving the coupon every quarter or six
39:09
Speaker 2: months or whatever it is. But for Australia based Australian investors,
39:13
Speaker 2: I think the better thing, or easier in my mind
39:16
Speaker 2: at least, is probably just lock into some term deposits
39:20
Speaker 2: if you really want to be in that area, because
39:22
Speaker 2: you'll understand the term deposit. They're not traded on the market,
39:26
Speaker 2: you don't see their value going up and down, and
39:29
Speaker 2: you're generally forced to keep them until they mature. It's
39:32
Speaker 2: very hard. You can break a term deposit, but there's
39:34
Speaker 2: usually a break fee, so we don't. Particularly, and particularly
39:39
Speaker 2: with the hybrid market disappearing, it's quite hard to find
39:43
Speaker 2: securities around that you can just sort of buy and hold.
39:47
Speaker 2: There are some, but it's not easy to find.
39:50
Speaker 1: That's terrific answer, thank you, And I think folks, that's
39:52
Speaker 1: worth's hearing from someone who's actually on the board of
39:54
Speaker 1: a big super fund. It really is okay because it's
39:57
Speaker 1: because it's that helicopter view. So I think that is
40:00
Speaker 1: a very interesting point and it never ends right about
40:04
Speaker 1: the whole thing about bonds and should you have bonds?
40:05
Speaker 1: But we've had more than one person on the show,
40:08
Speaker 1: from financial advisors who are just dealing with their clients
40:12
Speaker 1: to people who manage very large amounts of money saying
40:14
Speaker 1: that at TDS that is term deposits. You know, government
40:18
Speaker 1: guaranteed may serve that purpose more for most people most
40:23
Speaker 1: of the time.
40:23
Speaker 2: Okay.
40:24
Speaker 1: And finally, Andrew asks, when the market has a meltdown,
40:27
Speaker 1: isn't that just another way of saying that there is
40:29
Speaker 1: now a stack of cash and liquidity waiting to invest
40:33
Speaker 1: at a later stage. Yeah, yeah, sure, Andrew. A thing
40:37
Speaker 1: is when? Okay, because in two o eight they didn't
40:41
Speaker 1: come back for a long time into what they came
40:45
Speaker 1: back pretty fast in COVID.
40:46
Speaker 2: What do you think of that one, Chris Well, I
40:49
Speaker 2: have to smile too when I heard that question earlier,
40:54
Speaker 2: because again, we never know when the meltdowns kind of start.
40:58
Speaker 2: And people, you know, sun men, I have to say,
41:02
Speaker 2: although I've mixed with them for many years that they're
41:05
Speaker 2: very good marketers. I say, now's a buying opportunity. But
41:08
Speaker 2: of course we don't all just have cash sitting on
41:11
Speaker 2: the side waiting. I mean, you can It's like a
41:14
Speaker 2: clock that's broken, you know, but it's actually right twice
41:18
Speaker 2: a day if you think about it. You know, the
41:20
Speaker 2: clock's stall, but it's right twice a day. And sometimes
41:23
Speaker 2: people will sit there with a lot of cash waiting
41:27
Speaker 2: for something to happen and miss out on the opportunities
41:31
Speaker 2: or the good days in the more risky markets, so
41:34
Speaker 2: to speak. So I never quite understand the buying opportunity
41:38
Speaker 2: type of logic unless you do, you know, have cash,
41:42
Speaker 2: and you've got some fantastic way of knowing that this
41:46
Speaker 2: you're at the end of the meltdown. Because you know
41:49
Speaker 2: that adage about trying to catch a falling knife. It's
41:53
Speaker 2: very hard to know when things are going to stop
41:57
Speaker 2: going down. And I remember in the glow or financial crisis,
42:01
Speaker 2: where things ground on for ages down month after month
42:06
Speaker 2: for a long time, and I remember after about three months,
42:09
Speaker 2: I thought, I'm smart. Now I'm going to put money
42:11
Speaker 2: in the market. And you know, I tried to catch
42:13
Speaker 2: what I can now look back at. So it was
42:16
Speaker 2: definitely a falling knife and cut a few fingers off
42:18
Speaker 2: along the way. So it's not easy. I prefer a
42:22
Speaker 2: strategy that says set yourself for an all weather market
42:26
Speaker 2: upsow downs. That's you know, sit with a good advisor,
42:30
Speaker 2: work out how you want your money placed across different sectors,
42:35
Speaker 2: well diversified portfolio, enough cash to live on if you're
42:39
Speaker 2: drawing it down, and just gritch your teeth and stay
42:43
Speaker 2: away from knee jerk reactions, which we're all prone to do. That's,
42:48
Speaker 2: you know, if I had my time again as an
42:50
Speaker 2: investment professional, the first thing I should should have studied
42:54
Speaker 2: at university is behavioral science, not financial science, because people
43:00
Speaker 2: react in the investment markets with emotion first. The best
43:05
Speaker 2: investment managers in my career I've seen are often those
43:08
Speaker 2: who are slightly on the spectrum. They can be completely emotionless.
43:14
Speaker 1: Terrific. I imagine that is exactly true. That they all
43:17
Speaker 1: understand the finance. Everyone understands the finance, right, So all
43:20
Speaker 1: these people with the qualified they're all qualified. They understand
43:23
Speaker 1: the finance. But who understands human emotion? All right, we
43:26
Speaker 1: leave it there. That was terrific, Chris, Thank you very much,
43:29
Speaker 1: Chris Coff.
43:30
Speaker 2: Love it to have you on My pleasure. I love
43:32
Speaker 2: being on James.
43:33
Speaker 1: Great to have Chris Coff on the show. Folks, Okay,
43:36
Speaker 1: have a good break, have a good easter. We will
43:38
Speaker 1: be back very quickly. We're not taking a break. We
43:41
Speaker 1: motor on. Keep the questions Commons ruling the money puzzle
43:45
Speaker 1: at the Australian dot Com dot Au. Today's show was
43:48
Speaker 1: produced by Leah Sam mcglue and she's not taking a
43:50
Speaker 1: break either. Don't you soon, fo,