Insights

4 words that frighten a $180 billion fund manager

AustralianSuper chief investment officer Mark Delaney shakes his head whenever he hears this at a barbecue.
The post 4 words that frighten a $180 billion fund manager appeared first on Motley Fool Australia. –

business man wearing box on his head with a sad, crying face on it representing bad investment

Mark Delaney manages one of the biggest lumps of money in Australia.

Since 2006 he has been chief investment officer for AustralianSuper, which now has more than $180 billion under management.

One out of every ten Australians rely on him to maximise their retirement nest eggs.

So Delaney knows a thing or two about investing, and has heard all the barbecue talk about how to grow your money.

So what’s the cliché that frightens him the most for retail investors?

“There’s no more dangerous words in investing than ‘this time it’s different’,” he said at the Yahoo Finance All Markets Summit.

“Every time people say ‘this time it’s different’, you should probably do the opposite.”

Is it different this time in 2020?

COVID-19 has made for an unprecedented 2020, which could well cause permanent changes to the way we live and work.

And that’s had some thinking whether the fundamentals of investment have also shifted.

Plenty of newbies have dived into the sharemarket this year, pouring in what fund manager Geoff Wilson called “non-sophisticated money”.

Financial authorities and veteran investors are worried that many are in to make a quick buck and could plunge themselves into horrible trouble.

This is why Delaney advised investors to resist this short-sightedness and go long.

“The biggest risk in investing is not that you lose money in the short term,” he said.

“But it’s that your investments don’t deliver what you want them to in the long term.”

Good times follow tough times

It’s a well-known investment axiom to stay the course during tough times.

But it’s easier said than done when emotions take over during a global recession.

Many superannuation account holders this year would have changed their investment mix to increase their proportion of cash.

For Delaney, this doesn’t make sense, because investing is for the future, not the present.

“It’s like driving your car on high beam. You’re not looking at the next bend — you’re looking at the bend after and the one after that,” he said.

“That’s what investing is, looking at what’s beyond what you can see in front of you.”

The Reserve Bank of Australia and central banks around the world have declared low interest rates will be around for many years to aid recovery.

So for Delaney, it makes sense to put your money into the inevitable recovery out of the pandemic.

“It doesn’t make any sense to invest in lower rates,” he said.

“Why don’t we invest in things that will benefit from the recovery in the economy, growth in earnings and businesses that are taking advantage of the structural changes that are taking place.”

These 3 stocks could be the next big movers in 2020

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

In this FREE STOCK REPORT, Scott just revealed what he believes are the 3 ASX stocks for the post COVID world that investors should buy right now while they still can. These stocks are trading at dirt-cheap prices and Scott thinks these could really go gangbusters as we move into ‘the new normal’.

Find out the names of our 3 Post COVID Stocks – For FREE!

*Returns as of 6/8/2020

More reading

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post 4 words that frighten a $180 billion fund manager appeared first on Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!