6 January 2020

Remuneration Report Analysis and Commentary: PortfolioDirect scores annual remuneration reports from ASX listed companies against a consistent analytical framework designed to help assess which reports are most worthy of shareholder support. 
Contents

Where are we in the Cycle?
Of the five PortfolioDirect cyclical guideposts, two are ‘red’ and three ‘amber’.  The cyclical positioning has been classified as ‘trough entry’ with lowered global growth expectations, a loss of output momentum in China, the largest national user of metal, a persistently high US dollar and less supportive policy settings acting as headwinds to  speedier cyclical progress.       More...

Market Directions
The overall market picture resembles the late 1990s during which time modest sector gains occurred in the midst of sometimes highly disruptive macro conditions and strong headline equity indicators. Global growth momentum is improving but the balance of near term risks to sector investment returns remains negative with equity prices in the leading US market, stoked by favourable monetary policy settings, now overvalued and the global growth outlook still insufficient to absorb growing mine supplies to create more buoyant expectations. Oil price risks are biased to the upside but the balance of metal market risks point to continuing weakness in cyclical conditions.          More...

Portfolio Performance and Positioning
Net gains were made in all three development categories during December with the small end of the market benefitting from end of the year seasonal factors. The market leaders have benefitted from generally favourable equity market conditions. No changes have been made to portfolio models which remain biased to the Phase I stock category.  Phase I stocks are likely to show less leverage to cyclical weakness than they have done in past cycles and positive leverage to a sustained improvement in sentiment toward the sector which would accompany stronger global growth.     More...

Stock Reviews and Rating Analysis 
PortfolioDirect rating reports analyse the quality and risk attributes of proposed mineral developments.  Rating criteria apply to mining and oil and gas stocks at any stage of development.  PortfolioDirect uses a five point rating scale to measure the risk adjusted quality of proposed mineral developments or companies.    
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The 'Steak or Sizzle' blog provides summary judgements on the top performing ASX-listed resources stocks. More...

Although the statements of fact in this report have been added from and are based upon sources the authors of the report believe to be reliable, their accuracy is not guaranteed and any such information may be incomplete or condensed.  To the extent permitted by law, the authors of the report are not liable for any loss or damage arising as a result of reliance placed on the contents of this report.  

All opinions and estimates in this communication constitute judgments by the authors at the report date and are subject to change without notice.  The report publisher is under no obligation to make public any change in view about any matter referred to in this document.    

No references to past investment performance should be taken to indicate anything about future performance.

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