The first edition of our fortnightly email newsletter for 2009 has been sent to subscribers on Tuesday 13th January.
In this edition we:
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consider the benefit of Australian share income over time,
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take a look at the ASX 200 contituent list,
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provide a summary of the movements in markets over the past fortnight including 3, 5 and 10 year return history,
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look at whether the beginning of 2009 is the time to be considering a more conservative superannuation investment allocation,
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introduce a new online forum - The Fama/French Forum,
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provide links to Scott's latest Eureka Report article, and
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update the 3 Factor Model in Action graphs to the end of December 2008.
If you would like to be added to the mailing list please click the following link to be taken to the sign up page - The Financial Fortnight That Was Sign Up Page.
The following is the market news section for the latest newsletter:
ASX P/E Ratio and Dividend Yields
The P/E ratio is a common broad indicator of the price of shares. It is a calculation of the price of shares compared to expected earnings. A higher ratio indicates that share prices are more expensive. The historical P/E ratio for the ASX has been between 14 & 15. The dividend yield is the calculation of dividend payments divided by the market capitalisation of the company or index. The historical average in Australia is around 4%.
As of January 6th the P/E ratio for the S&P/ASX 200 was 8.76. The dividend yield was 6.28%.
Volatility Index (VIX)
Another index we are keeping an eye on in the USA is the CBOE Volatility Index. This index purports to be a key measure of market expectations of near term volatility conveyed by the S&P 500 share index. The higher the level of index, the higher are expectations for volatility in the S&P 500 index. For more information on how the VIX is calculated please take a look at - www.cboe.com/micro/vix/introduction.aspx
As at the 12th of January the index closed at a level of 45.84. This is significantly down from the 80.1 level it had reached at its peak.
Market Indices
This year we have tabulated the index results and included extra time frames for returns.
|
|
Since last ed. |
Since Start of 2009 |
1 Year |
3 Year |
5 Year |
10 Year |
|
Australian Shares |
|
|
|
|
|
|
|
S&P - ASX 200 |
7.04% |
0.36% |
-38.63% |
-8.22% |
2.50% |
NA * |
|
International Shares |
|
|
|
|
|
|
|
MSCI World - Ex Australia |
6.02% |
0.16% |
-35.87% |
-9.99% |
-0.80% |
-0.80% |
|
MSCI Emerging Markets |
10.41% |
2.08% |
-43.69% |
-2.92% |
7.52% |
11.38% |
|
Property |
|
|
|
|
|
|
|
S&P - ASX 200 REIT |
3.79% |
4.80% |
-51.63% |
-21.16% |
-8.94% |
NA * |
|
S&P/Citigroup Global REIT - Ex Australia - World - AUD |
-1.02% |
-4.87% |
-22.80% |
-11.65% |
2.05% |
5.97% |
|
Currency |
|
|
|
|
|
|
|
US Exchange Rate |
9.77% |
2.05% |
-19.85% |
-2.09% |
-1.82% |
1.09% |
|
Trade Weighted Index |
6.32% |
2.88% |
-16.37% |
-3.32% |
-2.52% |
0.54% |
* - Data unavailable as ASX 200 only commenced on 31st March 2000
General News
Since our previous edition, The Australian Bureau of Statistic has released the latest employment data to the end of November 2008. The figures show that seasonally adjusted unemployment had grown to 4.4% over the month due to a decrease in part time employment of 24,400 yet there was also a rise in full time employment of 8,800.
