I hope you had a fantastic weekend, filled with friends and fun and probably some sport. Formula 1 is my sport of choice, though much of the Monaco Grand Prix made me wonder why. Probably the most entertaining part was that Vettel looks increasingly like someone who quit his job and moved to Noordhoek a year ago to start a small-scale lentil business.
Now, I am well aware that your portfolio has taken some severe pain in the past few months. With markets behaving badly, investors tend to look for additional sources of return and diversification. Westbrooke Alternative Asset Management is hosting a webinar on 24 June 2022 in which they will discuss the Westbrooke Yield Plus private debt fund. The minimum investment size is GBP100,000 so this clearly isn't for everyone. With a trailing 12-month return of 6.7% in GBP, this product is a good example of what becomes available to investors with larger balance sheets. If you have that kind of money, read more here and register for the webinar. If you don't, then keep doing what you're doing - by being here and reading Ghost Mail, you are on that wealth creation journey!
Moving on, the subject of this morning's mailer means I am showing my age here. "Getting your mack on" was high school slang (at least in my years there) for making a move on someone you fancy. With some liberal spelling, getting your MAC on becomes dealmaking slang for trying to wriggle out of a deal.
During the pandemic, Barloworld tried to get out of the Ingrain acquisition from Tongaat Hulett. They invoked the Material Adverse Change (MAC) clause to give themselves flexibility to try and walk away from the deal if need ed, though that did not happen in the end.
In my previous weekly Ghost Mail publication, I wrote about the MAC clause at that time. This is an escape hatch for dealmakers and is worth understanding more about. It is one of those legal clauses that makes your eyes glaze over, yet it can become the most important clause in the deal if things start to go wrong. To explain how this works in practice (and with Barloworld as the example), I fished out the article from the archives. Get your MAC on at this link.
A few of your senses can be tickled this morning. In addition to the articles, I have also got brand new podcasts for you and a video.
In Ghost Bites, I covered all the news from the JSE on Friday. It was another busy day, with a variety of companies like Pepkor, HCI, Gemfields, Nedbank and Finbond releasing updates.
There was an incredible nugget of information in the Pepkor update that is worth highlighting here: "While global supply chain uncertainties persist, it seems that shipping costs have stabilised and may trend downwards."
If you have been carefully following the markets and seeing the impact of supply chain pressures on companies, you will find that fascinating. Read the rest of the updates in Ghost Bites and remember that all of these shares can be bought at a low cost on the EasyEquities platform.
For an insightful read on South African infrastructure spend and where we rank globally as a percentage of GDP, Chris Gilmour has delivered a balanced view and perhaps even a message of hope. Read it here.
On the podcast front, I was a guest on the excellent Honest Money show hosted by Warren Ingram. We chatted about active vs. passive investing, an age-old debate in investing that I tried to bring fresh perspectives to. Give this great podcast a listen here.
I would also like you to listen to Episode 77 of Magic Markets, in which we hosted Petri Redelinghuys of Herenya Capital Advisors to talk about how to survive bear markets. There were many great insights in this show, along with a discussion on broader themes like uranium, resources and banks. If you are serious about growing your skills as an investor or trader, then the insights on Magic Markets are invaluable. Listen to the episode here.
For those of you who are interested in small- and mid-caps on the JSE, Unlock the Stock offers a wonderful platform that lets you engage directly with management teams and ask them questions. Last week, we hosted Calgro M 3 and there was a vibrant Q&A session. The recording is already available in case you missed it. If you are curious about this company, be sure to watch the video here.
Before unleashing you into the wild this week, we get more context on the markets from Wichard Cilliers, Head of Markets Risk at TreasuryONE:
"We start the week off with the local currency on firmer footing. The broad-based USD weakness has helped most emerging market currencies trade firmer. US equity markets ended last week off with a strong rally with the Nasdaq ending the day up over 3%. There is not too much on the data front early in the week, as it is Memorial Day in the US and they are out of the markets today. We do end the week off with US non-farm payrolls which could cause some volatili ty."
There is plenty to keep you busy this morning. Thanks for being here and for trusting me to deliver you a curated set of market insights that will help you on your wealth creation journey.
Have a lovely Monday!
