A year ago I sat down with Oscar Oberg, lead portfolio manager at Wilson Asset Management. His thesis then was that small caps were beaten down and due some mean reversion.
Alas, small caps haven’t done much since then, with the Small Ords returning 3.91%. Yet Oscar’s thesis also remains unchanged.
In fact, it’s gotten stronger!
Not only is he positioning for a rebound in smalls and microcaps, he’s doing it with overweight exposure to consumer discretionary, a sector that has been tarred and feathered by today’s macroeconomic landscape of high inflation and high rates. As Oscar puts it, “there’s no mean reversion without consumer discretionary.”
In today’s episode, Oscar lays out this thesis and the companies that make it up.
He also discusses:
Note: This episode was recorded on Tuesday July 20, 2023.
Timestamps
0:00 - START
1:50 - When will small caps bottom?
4:30 - No small cap rally without consumer discretionary
6:30 - Profit taking
7:30 - Why large cap tech matters to small caps
10:14 - 30-40% rally is not out of the question
14:30 - Harvey Norman's (ASX: HVN) property backstop
16:00 - Wearing the volatility
17:00 - Industrials
20:20 - Going tactical
24:15 - Mermaid Marine
26:30 - Body language matters
27:30 - City Chic (ASX: CCX) was a mistake
29:20 - Managing liquidity in small caps
32:45 - Takeover target
34:50 - Balance sheets look good
36:55 - Going public too early
40:25 - The classifieds company for the bottom drawer
Chris Stott’s 5 high conviction stock ideas for the new bull market
Christopher Joye: No margin for error for risk junkies craving rate cuts
Why Ben Clark is taking profits on growth stocks (and where he's putting that money to work)
Trailer: Ben Clark, TMS Capital
The next 10 years in ETF growth could be dominated by this asset class
Warryn Robertson’s guide to picking the best infrastructure stocks on the ASX and abroad
The policy overhaul Shane Oliver would make to secure Australia's fortunes
Where Soul Patts is investing for long term growth and dividends
How Hyperion unearths rare but exceptional growth companies (plus two that pass their filters)
How to invest $1 million in 2024
The lead indicator for Dion Hershan’s best trades (and two high quality stocks for the ”slow grind” ahead)
Ben Griffiths’ small cap playbook as animal spirits awaken
2 killer growth stocks (and why culture is key to successful small caps)
Trailer: Qiao Ma, Munro Partners
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Invest in what you know, avoid what you don’t: Lessons from a Hall of Fame fund manager
Emma Fisher: Why it pays to be bullish (and the most outstanding idea on the ASX today)
Matthew Kidman: Get ready to run with the bulls
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Bob Desmond names his ”forever” stock
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