Category: The Slack Way

Ride that Horse! – October 2025 End of Month Update

Calgary Sun

Slack Investor reads a lot of finance news each week. Sadly, there now seems to be a portion of the finance news that seems to come from AI sources. However, there is still a lot of good stuff by real people – and he came across an excellent article by Carl Capolingua that had some great investor truths that apply to the current market.

A disciplined investor doesn’t fight the market – they respect it. They accept the market is responsible for their investing outcomes, win, lose or draw. They also accept that they have absolutely no control over the market or the outcomes it delivers. – Carl Capolingua, Livewire Markets

The original article focuses on the difficulty of letting go of investments that have shown a loss. Slack Investor is still searching for this zen state and has written about his own troubles with selling stocks that have had a sudden fall. However, the quote above sums up ‘the bargain’ that Slack Investor has made with stocks and their volatility. I don’t know when the next correction (or worse!) is coming … but I know it’s coming.

World Markets are Expensive at the Moment

Although Slack Investor collects his own data on relative market value using CAPE numbers, the remarkable Ashley Owen has produced a great graphic showing the relative size of the world markets and how expensive they are at the moment in terms of PE and Yield. Clearly, the US market looks over ripe and any corrections here will historically influence all other markets.

World markets plotted by PE Ratio and Yield – From the very erudite Ashley Owen of Owen Analytics

Short-term Returns are Volatile

The chart below shows that the S&P 500 returns for a calendar year are all over the place, but if you just hung on, and didn’t sell the S&P 500 when times were tough, you would be rewarded with an average annual return of 12.2% over 30 years. Not Bad. Australian shares have returned an average yearly gain of 11.5% from 1900 to 2020.

Yearly Returns of the S&P 500 (green columns) and 15-yr rolling returns (blue line) – From T. RowePrice

What to do when the Correction comes

‘If you have trouble imagining a 20% loss in the stock market, you shouldn’t be in stocks.‘ – Vanguard founder – John C. Bogle

Slack Investor has had no real luck in timing the markets – despite a disciplined 21-yr project trying to do this. There are those that can, Marcus Padley and his investment team have gone to 100% cash and reported this on 21 October 2025. Slack Investor hasn’t the knowledge, or gumption, to confidently predict market exits and entries – and yet, has done OK in the investing business without too much angst.

Slack Investor knows that for an ordinary person, the stock market is the place with best long-term returns with minimal transaction costs. The bargain – to accept volatility in return for long-term gains – is accepted.

  • He has his stable income pile to keep the dogs from the door.
  • He tinkers with his Investment Portfolio of predominantly growth shares, but mostly he leaves it alone.
  • He will not sell his shares after a correction and convert to cash.
  • He has elevated his cash position slightly (6% cash, 94% invested) in case some bargains come up post-correction.

These are choppy times and there is an uncertain near-term future – situation normal in the stock market. Some of his portfolio (e.g. CSL, WTC, TLX) have had big falls lately. However, Slack Investor has had a look at future revenue predictions and has not completely given up on these stocks. Though, CSL is losing its shine as a growth company in Slack Investor terms.

He will keep riding that stock market horse … and push to the forefront of his mind the pleasant times at the rodeo bar with his cowboy mates … reflecting on our glorious achievements.

October 2025 – End of Month Update

Slack Investor is IN for Australian index shares, the US Index S&P 500 and the FTSE 100.

The S&P 500 (+2.3%) and the FTSE 100 (+3.9%) have continued their strong monthly growth. Slack Investor is pleased to stay on board but there he remains nervous about the US markets. For the ASX 200, (+0.4%) a flat month with plenty of volatility.

All Index pages and charts have been updated to reflect the monthly changes – (ASX Index, UK Index, US Index).

The Minutia of Investing – Portfolio Tracking and Tax Reporting

Slack Investor has just finished the inputs for his family tax returns and our SMSF tax return. All Good – and he was pleased that it was a painless procedure. After many years of investing, he has got himself organized.

A lot of the tax-time pain has been erased because of his disciplined rituals. As soon as he gets a communication about his shares (usually email) it is downloaded to one of Slack Investor’s Finance folders on his PC. The Finance folder has two sub-folders one for Transactions (Buy/Sell contract notes from Brokers) and, another for communications from Share Registries labelled DIVIDENDS_TaxStatements. He then saves items in these folders with specific notation Account_StockSymbol_Type of document_Date of issue (YYYY-MM-DD). For Tax Statements, Slack Investor will allocate the date for the end of tax year that the statement covered. After completing tax returns, Slack Investor will archive the files to the folder for the previous tax year – and start again for the current year.

Slack Investor’s Portfolio Tracking

Microsoft Money Sunset

Slack Investor will also enter any transactions or income events into his portfolio tracking software. He uses the retired but excellent (and free) ‘Sunset’ International English version of Microsoft Money downloaded from Gareth J. M. Saunders site. There is also a UK Version, and a US Version.

To automate share price updates it is necessary to use a service like  MSMoneyQuotes. The latter is not freeware but the $US10 lifetime licence is money well spent. MS Money is now a 20-yr old bit of software and is a bit clunky but there is a good installation guide at TechFinitive that will help you through – including some registry changes to work with windows 10/11. Slack Investor loves MS Money, and the many support sites, e.g. View from the Potting Shed which has a free support pdf available, Ameridan’s Blog and moneymvps.org. He has been using versions of MS Money for 30 years!

For those who don’t want to wander through the complications of the Microsoft Money path, it is really important to track your portfolio for capital gains and performance, and at least some sort of portfolio tracking is recommended. Slack Investor cannot stress this enough. The ATO will want information when you sell stocks. They require your sell date and price, and the harder to find, buy date and initial cost of your shares/ETF’s – in order to calculate any capital gains tax. This procedure can get complicated when you buy shares in different lots or, participate in a dividend re-investment program as the ATO require a cost-basis for each parcel. It will make your life easier if you have a portfolio manager or, at least, a capital gains tracker.

Portfolio Tracking with Monthly Fees

For Australians, the slickest products involve an annual/monthly cost as good financial software requires constant development.

Sharesight

A highly-rated financial portfolio tracker that includes tax statements and capital gains tracking for $228 annually for one portfolio or $348 annually for up to 4 portfolios. Sharesight used to have a free version that included tax reporting for one portfolio with under 10 shares. However, they have now dropped tax reporting privileges for free accounts.

Navexa

Another nice looking and highly-rated product. A financial portfolio tracker that includes tax statements and capital gains tracking for $240 annually for one portfolio or $300 annually for up to 3 portfolios.

Snowball

This is a US-based portfolio tracker so it will not help greatly with your Australian tax reporting. However, it is a highly-rated and a good looking way to track your Australian and US shares for around $130 AUD annually for one portfolio or $230 AUD annually for up to 10 portfolios.

Finance Tracking without Monthly Fees

Down at the budget end we have products that require a bit more work. There are a few other alternative finance products that are discussed in Whirlpool – but Slack Investor presents a few solutions below.

Yahoo Finance

This is a very basic tracker that can track your overall portfolio performance if you enter your buys and sells and dividends manually. Slack Investor uses Yahoo Finance to keep an eye on the day to day movements of his portfolio plus watchlists. There is no tax reporting or help with capital gains, but Yahoo Finance is a free portal to track your portfolio and it will have your buy and sell information in one place.

Stock Profit

An excellent free alternative to portfolio tracking is the google sheets based Stock Profit. There is a bit of a effort in setting it up but it will track your performance and capital gains with ease. This really is a good product.

Capital Gains Tracker

If you are not worried about portfolio tracking you will make your life easier at tax time if you have some means of tracking capital gains and the free web-based but locally stored cgtracker will supply you with capital gains information and tax statements. Capital Gains Tracker is free to use but you must enter all your buy/sell information.

Personal taxes and Mytax

Firstly, a ‘Hats Off’ to the ATO who have made their online tax returns (MyTax) a very simple process with the ‘pre-filling’ of wages, dividends and distributions. Slack Investor usually waits till September to allow all the pre-filling documents time to trickle in to the ATO. It is now incredibly easy to fill in a tax return yourself and only those with very complex tax affairs should need an accountant.

If your tax affairs are relatively straightforward, MyTax is a fast, free and effective way to lodge your return online. It puts control in your hands, provides instant access to pre-filled information, and helps you get your refund sooner. – Tax Window

By September, all of Slack Investor’s personal tax information was pre-filled, including the distributions from ETF’s that often have internal capital gains and foreign income. He had additional capital gains from share selling and opted to use their Capital Gains Worksheet which was part of MyTax – it already had the small ETF internal capital gains prefilled and he just had to add buy dates and costs for each lot of shares sold. Slack Investor had all of this information on MS Money – but any capital gains tracker would have this information in one place. For advice on any problems with MyTax, he went to the ATO community rather than the official ATO site – which often has opaque, or vague, solutions to your problems.

SMSF Tax Return

Slack Investor started the process in October when his provider (Esuperfund) prompted him to allocate categories to each of the transactions for his SMSF Bank account. All the dividends and distributions were pre-filled but he needed to label the type of contributions (concessional/non-concessional) and the relevant member of the SMSF. Also, he had to determine from which pension account any withdrawals came from. There was some head scratching to make sure the minimum amount withdrawal requirement (5% age 65–74, 4% age under 65) from each pension account had been fulfilled.

Slack Investor had to assure Esuperfund that he hadn’t bought any exotic assets outside of their monitored banks/brokers. He also had to upload Tax Statements from each of the ETF’s in the SMSF portfolio. Luckily, they were all in one place in my Dividends_Tax Statements folder. He submitted the checklist and now have to wait a long ~7 months – till May 2026. By which time, Esuperfund will have obtained an Auditor’s review and will present the trustees with the 2025 SMSF Tax Return to sign.

Bogleheads and Vanguard Annual Chart – August 2025 End of Month Update

Slack Investor Hero John ‘Jack’ Bogle with a fitting ‘HOLD’ mantra.

Bogleheads and Vanguard

Slack Investor has paid tribute to the contribution that Jack Bogle has made to the investing world. He started Vanguard Investments in 1974. Bogle’s philosophy wasn’t about trying to beat the index and charging high costs – instead, he would offer a low-cost alternative fund based on the US index. Mr Bogle’s pioneering work with these low-cost funds has led to the popular low-cost Exchange Traded Funds (ETF’s) that proliferate today. Astonishingly, there are now more ETF’s listed in the US (4300) than actual companies (4200).

Slack Investor can well remember the days when a fund manager would charge you 4% of your capital for entry and then lift a further 2-3% in annual fees for the privilege of investing your money – that was not the ‘good old days’.

‘Bogleheads’ are a group of mainly US followers of Jack Bogle’s philosophy and they strive for long-term growth through low-cost, diversified index funds while minimizing fees. They are generally ‘Buy and Hold’ investors. One of their strategies is the three-fund portfolio – where investing is simplified into three low-cost funds – one for the local share market, one for international shares and one for bonds. For the US, the conservative recommended proportions are, your age defines the % in Bonds and the remainder percentage is split so that roughly 20% is in international equities.

In Australia, such a portfolio is a little more complicated as you need to cover yourself for currency risk – and hedge your international exposure for any fluctuations in the Australian dollar. Exposure to emerging markets is also recommended as a diversifier of risk. A Bogleheads type of portfolio is possible using 5 Vanguard funds.

AUD based equitiesVAS  (MER: 0.07%)(Australian equities)
VGAD  (MER: 0.21%)(Developed world ex-Australia equities – hedged to AUD)
Non-AUD based equitiesVGS  (MER: 0.18%)(Developed world ex-Australia equities)
VGE  (MER: 0.48%)(Emerging Markets)
BondsVAF  (MER: 0.10%) (Aggregate bond fund)
The 5 ETF’s for an Australian Bogleheads portfolio. Management Expense Ratios (MER) ar shown for each ETF. For a younger person, Australian Bogleheads suggest proportions VAS: 20%, VGAD: 20%, VGS: 40%, VGE: 10% and VAF: 10% – From Passive Investing Australia.

Slack Investor can see the attraction that Bogleheads have in passive investing and, when he loses his mojo, will opt for a more simplified Boglehead-approved passive exposure to growth and cash/bond assets. Stockspot also offer diversified portfolios using just 5 ETF’s – with excellent performance so far.

Vanguard Financial Year Total Returns for major asset classes

Every August, Vanguard produces a summary brochure focusing on the last 30 years of finance data. It is a reminder that the top performing asset class for each year (green) is seldom the top performer the year after. A lesson in diversification.

Extract from the FY 2025 Vanguard Index Chart Brochure showing the total returns for each asset class for the financial years since 1996. Top performing asset class for the year is highlighted in green and the worst in pink.

Vanguard Annual Chart

It is now time for Slack Investor’s favourite chart – a succinct demonstration of long-term investing. The essence of successful investing is to be invested at least somewhere in appreciating assets – and then, let time do its work. Below is an extract from the Vanguard 2025 long-term investing chart. The numbers on the right are the results of investing $10,000 in the Index funds of the indicated asset classes for 30 years.

Extract from the 2025 Vanguard Index chart (Just the 2007-2025 portion is shown) – the dollar values on the right are the results of investing $10,000 in index funds in each asset class for 30 years (since July 1995). – Check out the full 30-year glory of the Vanguard 2025.PDF chart – Click image for the whole 30-yr chart.

August 2025 – End of Month Update

Slack Investor is IN for Australian index shares, the US Index S&P 500 and the FTSE 100.

The S&P 500 (+1.9%) continues its progress. Slack Investor is pleased to go with the flow but remains nervous for the US markets. For the ASX 200 (+2.6%) and the FTSE 100 (+0.6%), also some monthly gains.

The latest reporting season has brought a few shocks to the Slack Portfolio. Big falls in Botanix (BOT), Telix Pharma (TLX), and CSL. Not so worried about CSL, but looking to reduce holdings in the less established companies (BOT, TLX) when things settle down. Next blog, Slack investor will go into detail how he is dealing with a few sudden drops in individual stocks.

All Index pages and charts have been updated to reflect the monthly changes – (ASX Index, UK Index, US Index).

Financial Year 2025 – Full Slack Results

‘In God we trust; all others bring data.‘

W. Edwards Deming Statistician/Consultant (1900–1993)

Slack Investor likes to measure things, especially long-term results. In the world markets, for FY 2025, the FTSE 100 Total Return Index was up 10.8% (FY 2024 up 11.8%). Dividends helped the Australian Accumulation Index to be up 9.0% for the financial year (FY 2024 +12.2%). The S&P 500 Total Return Index is again the top performer – and was up 15.2% (FY 2024 +24.2%). All of these Total Return Indices include any accumulated dividends.

Slack Investor has stuck to his strategy of mostly investing with growing companies that are profitable (Return on Equity >15%), have an established earnings record and, not too expensive (forward P/E ratios <50). He expects a bit of volatility in his growth oriented investment portfolio. He is reassured that, despite the odd negative year in the Slack Fund, the dividends and his separate Stable Income portfolio are doing what they should – keeping Slack Investor with enough cash to ‘keep the wheels on’ the Slack lifestyle – should the stock market sour.

Slack Portfolio Results FY 2025

All Performance results are before tax. The Slack Portfolio is Slack Investor’s investment portfolio. He is glad to report an annual FY 2025 performance of +18.1%. Full yearly results with Australian benchmarks are shown in the table below. Slack Investor realises that only long-term results really count.

For property values, Slack Investor is using the Home Price Index supplied by PropTrack. The Index uses median values for each city – I would have preferred calculations that include the net rental yield, but this will have to do. Of course, the real estate industry avoids true measurement of real estate performance by collecting figures only on gross price changes – they ignore the significant transfer costs involved (Stamp Duty, Conveyancing, Bank Fees, etc) and, the costs of any home improvements and renovations.

For FY 2025, the Australian Share market Total Return Index (ASX200 Acc) was up 9.0%. The Vanguard Diversified Growth ETF (VDGR), comprising International shares (42%) and Australian Shares (28%), increased by 12.7%. Inflation is now within the Reserve Bank target – with the CPI at +2.1%.

The Cash rate of 4.3% is above inflation. Cash is important – but not a way to grow your wealth. The average readily available cash rate of return since 2010 is 2.6% and, for cpi measured inflation, it is 2.7%.

Yearly Performance (%) results since 2010

The Slack Fund yearly Internal Rate of Return (IRR) vs BENCHMARKS. The Median Balanced Fund (41-60% Growth Assets), Vanguard Growth Fund, ASX 200 Accumulation Index, PropTrack Home Price Index in both Brisbane and Melbourne, and Cash (Australian Super Cash Fund) and Consumer Price Index (CPI). AV. YEARLY is the annual mean of all the data since 2010.

5-yr Average Annual Performance

Although Slack Investor collects yearly figures, the 5 and 10-year compound annual performance gives me a much better idea about how things are really going. Long-term results will smooth out any dud (or remarkable!) yearly figures. The Slack Fund is still ahead of most Benchmarks – but running a close second is Brisbane Residential real estate over a five-year period.

The Slack Fund average 5-yr compound yearly return vs BENCHMARKS in chart form.

10-year compound annual rate of return

The Slack Fund has been around a while and generating some good long term data (10-year compound ‘rolling’ annual rate of return). Over this time frame, the Slack Fund has been performing very well. For FY 2025, a 10-year annual rate of return of over 17% – Go Slack Fund! The 10-yr data is shown below in table and chart form.

It is useful to note that, the 10-yr rates of return for the Median Balanced Fund, Vanguard Growth fund, ASX200, and residential property in Brisbane and Melbourne are also good long-term investments. These appreciating assets generate a 10-yr compound annual rate of return in the region of 6-9% p.a.

The Slack Fund average 10-yr compound yearly return vs BENCHMARKS in table form. Prior to 2022, 10-yr Vanguard Growth fund figures were not available. AV. YEARLY is the annual mean of all the data since 2019.

Although Cash is necessary to add stability and flexibility to a portfolio. From the chart below, Cash as a long-term investment vehicle, is a poor choice.

The Slack Fund average 10-yr compound yearly return vs BENCHMARKS in chart form.

15-year compound annual rate of return

Perhaps because Slack Investor is showing signs of age, he notices that there is enough accumulated data for rolling 15-yr rates of return. Happy to report solid long-term results.

The Slack Fund average 15-yr compound yearly return vs BENCHMARKS in table form.

Growth of a $10 000 Investment Since 2009

The beauty of compounding with a succession of good performance results can be seen in the chart below showing the growth of an initial investment in June 2009 of $10 000.

The growth of $10 000 invested in the Slack Fund vs BENCHMARKS. The Median Balanced Fund (41-60% Growth Assets), Vanguard Growth Fund, ASX 200 Accumulation Index, PropTrack Home Price Index in both Brisbane and Melbourne, and Cash (Australian Super Cash Fund).

The Slack Fund has exceeded my expectations. Also, the chart shows that investing in either shares or residential property has been a solid way of growing your money over the long term.

Market Timing Experiment – Update

Apologies for intruding into your inbox. I like to keep the Slack Investor blog folly to twice a month. But these are unusual times.

The Slack Investor Market Timing Experiment

Slack Investor started his ‘index-timing’ strategy in 2004 with the ASX Index, UK Index, US Index. An earlier version of Slack Investor thought that by monitoring the market at weekly and monthly intervals and setting ‘stop losses’ to know when to sell the index. To know when to buy, he used a momentum indicator called the Directional Movement Index.

Although, there was some initial success over the ‘buy and hold’ strategy, the benefits work out to be quite small on a yearly basis. For example, for the Australian Index there is a 1.2% p.a. outperformance for Slack market timing strategy over ‘buy and hold’.

These relatively small gains would have probably been offset by earned share dividends if I was using the alternative ‘buy and hold’ strategy. Market timing works well when there are sustained periods of bull and bear markets and the changes between the two are not too rapid. The short transitions and the speed of market fluctuations in the last 20 years has forced a bit of a rethink on Slack Investor’s timing the markets strategy.

Instead of monitoring the markets monthly, he has been looking for weekly changes as well. He is also taking the current market value and recent trends into account. Slack Investor is a man of routine and he has now decided to keep the experiment going for 25 years (till 2029). After this, he will probably go for the more appropriate Slack Investor method of doing nothing and adopting a ‘buy and hold’ technique for index funds (ASX Index, UK Index, US Index).

US Index – Slack Investor is OUT

Monthly chart S&P 500 up until Friday April 4 2023 – incrediblecharts.com

At the end of the past week, Slack Investor conducted a review of the Index charts and noted that the US Index price has slipped below the stop loss (thick red line). As the trend is still downward, and the market is overvalued (see below), it is time to get out. As part of this experiment, I will sell my small holding of S&P 500 Index tomorrow and update the US Index page.

US CAPE values – up till the end of March 2025 showing the index is still overvalued (at March 31). The CAPE ratio is above the green zone.

What about the rest of the Slack Portfolio?

Deep down, Slack Investor doesn’t believe he is very good at timing the markets. The bulk of the Slack Portfolio (97%) is not in index funds, but in growth companies – that are taking a bit of a beating at the moment. That’s what the stock market does in times of uncertainty.

Mostly, Slack Investor will be doing nothing. He will try and distract himself from the self-destructing behaviour of Trump. I cannot remember a time where the whole world was so united in its resolve against the USA. Slack Investor knows that good times (and prices) will return. Slack Investor has his Stable Income Portfolio if he needs cash.

The worst thing to do, from a long-term wealth perspective, is to convert shares to cash in a down market – Slack Investor (and other wise investors!)

On the back burner is my project to sell some of the Slack Investor owned companies with a relatively low Slack Factor – and invest more in those with a high Slack Factor.

The Slack Factor – March 2025 End of Month Update

A WordPress AI generated weird image that reassuringly does not make any physical sense.

Reporting Season

During February, most companies report on their progress up to the end of December. There is a similar reporting season in August for the period up to 30 June. Once all the analyst projections for future earnings are in, it is a good time to update the state of play for companies in the Slack Portfolio.

It took a while for Slack Investor to understand that a company could come in with a great report on the business and still, the price of the shares might go down. This is because reporting season is all about expectations. If a company was expecting an increase in earnings of 22% – and they ‘only’ achieved 20%, the share price is likely to get knocked down on the announcement.

As the Slack Portfolio consists of mostly growing stocks with a relatively high Price to Earnings Ratio. The growing stocks usually have high prices as the company’s growth is priced in. These stocks can get punished severely when an earnings target is missed – price falls of 10-20% are not uncommon. But, it is long term results that really count and Slack Investor is willing to endure any short-term pain for a growing company. This period of ‘Trumpenomics’ is an example of such a time.

Slack Investor uses the excellent Market Screener site (requires email registration) to get information from the Financials tab for each company. Analyst information is not available for ETF’s so, only data on the individual companies that are in the Portfolio is gathered.

In the table below, information is listed for the forecast P/E Ratio (PE 2027), the forecast Return on Equity (ROE 2027), the forecast Earnings Per Share Growth (EPSG 2025) (EPSG 2026) (EPSG 2027) and the average of the three Earnings Per Share Growth figures (EPSG AV). There is some fudging of the figures as some of the forecast EPSG figures were unavailable. Also, for some of the companies that are new to profit, their EPSG figures are skewed – I have limited the EPSG (AV) to a maximum of 50. I have ranked the companies in order according to their Slack Factor.

The Slack Factor

What is the Slack Factor? It is well known that Slack Investor likes

  • Profitability – measured in terms of the forecast Return on Equity – ROE 2027
  • Growth – measured as the average forecast Earnings Per Share Growth – EPSG (AV) for the three years 2025, 2026 and 2027.

It is well known that Slack Investor does not like

  • High Price to Earnings Ratios – measured in terms of the forecast Return on Equity – PE 2027. Sometimes, great companies are just too expensive.
ROE is the forecast ROE (ROE 2027), EPSG is the forecast EPSG for the next three years (EPSG AV) and, PE Ratio is the forecast PE Ratio (PE 2027).

So, things he likes go on the top line and the things that he doesn’t like go on the bottom line. This reduces a lot of the complicated information in Slack Investor’s tiny brain to one number. He has made no attempt to scale (normalise) each input into the Slack Factor. It is just a simple way to rank companies with qualities that he thinks are good. The bigger the number, the more likely the company has attributes that Slack Investor likes – profitability, growth and a price tag that is not too expensive. With these traits … surely good things are more likely to happen?

The fast growing Telix Pharmaceuticals (TLX) is a company that Slack Investor is a fan of, and it has a high Slack Factor of 52. The growth dullard Commonwealth Bank (CBA) has a Slack Factor of only 3 – and, is of no interest to Slack Investor.

NameSymbolPE 2027ROE 2027EPSG 2025EPSG 2026EPSG 2027EPSG (AV)SLACK FACTOR
Telix PharmaceuticalsTLX252623070305052
REA GroupREA40329811174234
CodanCDA19232023182025
Alphabet (US)GOOGL15251214161423
Supply NetworkSNL29382314151723
MegaportMP15019-9160405019
Pro MedicusPME115534042303717
WiseTech GlobalWTC42203238343517
Technology OneTNE48341820191913
CSLCSL20181215161413
Goodman GroupGMG1811 34122012
Coles GroupCOL1832-2175712
RPM HoldingsRUL38181025402512
XRF ScientificXRF20181711111312
CAR GroupCAR28153518122212
ResMedRMD2023910111012
WesfarmersWES24333139811
Nick ScaliNCK1529-282914510
CochlearCOH342515716139
Macquarie GroupMQG15136188119
Botanix PharmaBOTNotRanked–NotEnoughInfo

Over the next quarter, I will try and sell some of the Slack Investor owned companies with a relatively low Slack Factor – and invest more in those with a high Slack Factor. For homework, using Market Screener, try to work out the Slack Factor for some of the companies in your own portfolio.

March 2025 – End of Month Update

The current ‘Trump Slump’ in stock prices can be attributed to the largest upheaval to global trade since the Second World War – Thanks Donald! All followed markets fell this month. The ASX 200 down 4.0%, the FTSE 100 down 2.6%, and the S&P 500 down 5.8%. For now, each Index remains above their stop losses. Slack Investor remains IN for the FTSE 100, the ASX 200, and the US Index S&P 500.

Slack Investor took the opportunity to tighten up his stop loss values for the FTSE 100 and the ASX 200. On the UK Index chart below, by drawing a black wavy line under the monthly minimum values, it can be seen that some new ‘higher lows’ have been established. It made sense to move up the stop loss to the most recent ‘higher low’.

Monthly price chart for the FTSE 100 – incrediblecharts.com

All Index pages and charts  have been updated to reflect the monthly changes – (ASX Index, UK Index, US Index). The quarterly updates to the Slack Portfolio have also been completed.

Intergenerational Wealth Transfer and December 2024 – End of Month Update

The incomparable cartoonist David Rowe capturing Donald Trump in the Australian Financial Review taking the Republican party for a swim in the sewer.

The Clown in Chief – Stable Genius? Great Investor?

Far be it for Slack Investor to disparage the wisdom of the majority of voting Americans that have just elected Donald Trump for four years as their president. Despite Trump declaring himself as a ‘stable genius’, my mother wisely used to say that ‘Self-praise is no recommendation’.

“I built what I built myself” – Donald Trump 

PolitiFact disputes the extent of this claim. There is no doubt that Donald’s path to being a billionaire was helped by intergenerational wealth transfer. Around 1974, his father lent him $140 million in today’s dollars – most of which was never paid back.

“Fred Trump actually lent him at least $60.7 million, or $140 million in today’s dollars.” – New York Times: Special Investigation

There is some contention on how much was available in ‘free cash’ but, if the available amount was invested in S&P 500 stocks in 1974, PolitiFact estimate that it would be worth at least $3 bil­lion today. Using different initial estimates, the National Journal estimates that passive investing in stocks could have enriched Donald by $US8 billion. So, it seems that Donald was destined to be a billionaire – whether investing in real estate – or the stock market.

“Bloomberg puts Trump’s current net worth at $2.9 billion, Forbes at $4.1 billion. The National Journal has worked out that if Trump had just put his father’s money in a mutual fund that tracked the S&P 500 and spent his career finger-painting, he’d have $8 billion.” – Source: National Journal

To further harp on about the miracle of compound interest , there are huge advantages in starting to invest at an early stage. The chart below contrasts the case of Investor 1 at age 25 and investing $5000 per year for 10 years – then stopping, and allowing the compounding interest to do its work. Investor 2 doesn’t start his investing quest till the age of 35, and invests $5000 per year for 30 years. He never catches up to Investor 1.

Source: Federal Reserve Bank of St Louis

Of course, Slack Investor is all about personal empowerment and the chart above rings the bell on starting your investment journey as soon as possible. In the journey of life, you may be one of the lucky ones to receive a gift or inheritance along the way – this advantage is huge! Slack Investor acknowledges his privilege and was given a gift from his grandfather’s estate equivalent to 30% of a year’s salary in his early thirties. The gift went straight on my mortgage.

This makes Slack Investor ponder about the help that a monetary gift can bring. Slack investor is all for self improvement, through education or travel. However, if given a gift of money, he would recommend, at least, using a good portion of it to reduce any debt – or invest. But do it now.

December 2024 – End of Month Update

OK, someone must have been naughty! The year closes and there was no December ‘Santa Rally’ this month. All followed markets fell. The ASX200 down 3.3%, the FTSE100 down 1.4%, and the S&P500 down 2.5%. Slack Investor remains IN for the FTSE100, the ASX200, and the US Index S&P500.

I haven’t yet done the maths on the market yearly gains that include dividends. In raw terms, for calendar year 2024, the ASX 200 was up 7.5%, the FTSE 100 up 5.7%, and the S&P 500 up 23.3%.

All Index pages and charts  have been updated to reflect the monthly changes – (ASX Index, UK Index, US Index). The quarterly updates to the Slack Portfolio have also been completed.

Money Makes Money – and November 2024 – End of Month Update

My Dad was an amateur finance bloke and would often spend the quiet hours of the night with a notebook and reading matter that would usually have the theme of unlocking great wealth for his family. One of his sayings was:

‘Money Makes Money’ – My Dad

We were from a large family and there were always sufficient ‘outgoings’ to make sure that my Dad never really got to test the theory on his own funds. But, he believed that if only he could amass a chunk of money, then this could be invested wisely and, it would keep on growing and, he would never have to worry about money, ever again!

He had seen many examples of the rich getting richer. People with money increasing their wealth in a seemingly effortless fashion e.g. A Sydney harbourside home bought for $10 million selling for $26 million four years later. He was also a fan of Noel Whitaker and bought one of the first editions (in 1987!) of Noel’s great book Making Money Made Simple. My Dad understood the simple truth of saving more than you earn, investing these savings and letting the compounding do its work over time. Although it takes more time than harbourside investing, Noel’s advice still holds up.

I have since learned that my Dad might have got the ‘money’ quote from Benjamin Franklin who, expresses the full beauty of the compound interest process.

“Money makes money. And the money that money makes, makes money.” – Benjamin Franklin 

So, it is not only the money that you invest, but all the earnings are earning too.

The one-eyed political investor

Let’s suppose you were such a committed US political investor that you only had funds in the market when ‘your president’ was in power – and, quickly withdrew your investments when the other team got in. Using 70 years of S&P 500 data shows that you might be better off if you were a Democratic investor. However, your gains would be tiny compared to the situation where you were more relaxed and just kept your money in the market – regardless of President. The lesson is, that time in the market is the key.

Investing in the US S&P 500 index from Jan 1953 to September 2024- Source Financial Synergies

It is time in the market that matters – not who you vote for!

The following pair of charts presents another way of looking at the effects of one-eyed political investing, either Democrat or Republican, over a 10-yr time frame and also, a 70-yr period. The time periods are different to the above chart and hence the different final dollar totals.

If you invested ONLY when your political party was in power, you would be much worse off.

Using S&P 500 and proxy data for 10 years and 50 years till December 2023 – Source: Steelpeak Wealth

Slack Investor has seen the shape of the green curve on the right hand side before. It echoes the hundreds of compound interest charts that I have looked at for inspiration. It starts flat and then rapidly increases with time.

“Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn’t, pays it.” – attributed to Albert Einstein

Let’s say you managed to save $10 000 per year and you invested the money with an average return of 10%.

The blue line indicates the value of investing $10 000 p.a. and, compounding over 30 years. The green circle is where your interest earnings start to exceed the amount of your own money invested – Source: A Wealth of Common Sense

The brown line shows savings of $10 000 p.a., for 30 years, amounting to $300 000 of your money. The grey line represents the total compound interest on your investments. For the first 15 years you think you are getting nowhere – then the compounding kicks in with the help of time – your money plus earnings on that money plus time. Using the above assumptions, the total accumulated amount would be over $1 660 000.

The 10% earnings seems a little wishful. Although, past 30-yr averages for US shares, International shares, Australian stocks and Australian Listed property are, respectively, 11.1%, 8.2%, 9.1%, 7.8%. If your investments averaged 8% p.a., the total value of your investments would be $1 233 449 – Not Bad! However, life is not really like an Excel spreadsheet.

Slack Investor’s case study of compounding

A real-life example of compounding returns can be found in Slack Investor’s own tracking of Net Worth. He has diligently tracked his Net Worth (Assets – Liabilities) for 34 years since 1990 using the free software Microsoft Money Sunset International Edition. There is no magic in this chart – except for the miracle of compounding! As a family, we achieved a savings rate (including superannuation) that varied between 20% and 45%p.a. of take home salaries. During this time we have had home loans and have always been investing.

Slack Investor’s (+Ms SI) Monthly Net Worth Chart over the 34 years of saving and investing since 1990 – Microsoft Money

Even though Slack Investor is familiar with the concept of compounding interest – he is continually astonished with the spectacular gains in net worth over the latter years.

My Dad was right … Money makes Money! Start saving and investing now and get on this ride!

November 2024 – End of month update

Slack Investor is IN for Australian index shares, the US Index S&P 500 and the FTSE 100.

To Slack Investor’s bewilderment, in what can only be described as a ringing endorsement for Trump economic policies, the S&P 500 raged ahead by 5.7 % in November.

For the ASX 200 (+3.4%) and the FTSE 100 (+2.2%) – it has also been a great month.

Slack Investor feels it is time to tackle another valuation of the markets next post.

All Index pages and charts have been updated to reflect the monthly changes – (ASX Index, UK Index, US Index).

Lessons in Going Down – and October 2024 – End of Month Update

Dramatic falls in a stock price … are not very nice. However, they are part of the game when investing in growth stocks. These falls usually come during reporting season. This is sometimes known as ‘confession season’.

ASX-listed companies are all required to report their earnings within two months of June 30 and December 31. The half-year reports are usually floated into the market during August and February – and this is the main time that the confessions come in. ASX companies can also give quarterly updates and, they are strictly bound by ‘Continuous Disclosure’. This is where they are obliged to promptly announce any new information that may affect the stock price.

Once an entity becomes aware of any information concerning it, that a reasonable person would expect to have a material effect on the price, or value of the entity’s securities, the entity must immediately tell ASX that information – ASX Continuous Disclosure Guide

When bad news comes in, there will be an announcement and there is usually a fall in stock price. Most of the time, bad news comes in the form of an earnings forecast not being met – an earnings downgrade. It is time for Slack Investor to get off the couch.

Slack Investor is not a ‘Day Trader’ and, also Slack! This means that he doesn’t get wind of a dramatic fall in one of my holdings till the end of the day. Sometimes it is even days after the event.

This gives him time to think about what to do next, and there are two schools of thought.

  1. Accept the loss and sell the stock to employ your funds elsewhere – as bad news often comes as a series.
  2. Reassess the numbers on the company and ask ‘Would you invest in this company today at the current price?‘

Experience tells Slack Investor that he is usually better off with option 1 – and investing the proceeds with a, hopefully, price increasing stock.

Recent Case Studies from the Slack Investor Rogue File

Megaport (MP1)

1-YR Chart Megaport – From Yahoo Finance

This was a sudden fall from grace as it was bought in August 2024. There was an earnings downgrade and it was an easy decision to get out – as no ‘love’ had been developed for the company. Slack Investor was wrong on his understanding of this companies earnings growth.

Webjet (WEB,WJL)

This is a complex one. Slack Investor recently bought Webjet (WEB) at around $9 on the basis of their fast growing internet business WebBeds – and its seemingly good projected numbers. In September 2024, Webjet went through a demerger that split the business into its retail Travel Agent (Webjet Group – WJL.ASX) and its global Business to Business booking site, mostly WebBeds, (WEB Travel Group – WEB.ASX). Webjet announced a profit warning on 14th October and the share price plummeted 35% in a day. Whoops!

1-YR Chart WEB Travel Group – From Yahoo Finance

Slack Investor planned to sell WJL, the retail travel agent part of the business (not a high growth sector), and keep the growing (+22% CAGR) demerged WebBeds (WEB). This might be a good business one day – but the big 35% drop spooked him and he sold them both for a combined price of $4.80. Ouch!

Codan (CDA)


5-YR Chart CODAN – From Yahoo Finance

Slack Investor thinks this is a good growing business but they had some revenue shortfalls that caused a 19% 1-day price drop in 2022. He probably should have got out then. However, he has grimly stuck with them and, after 2 years of falling stock prices, they seem to be on the right track. It remains in his portfolio.

Dicker Data (DDR)

5-YR Chart Dicker Data – From Yahoo Finance

After a 16% fall in a day in May 2024, Slack Investor reassessed the numbers on this stock – a projected 2026 PE of 16 and an ROE of 39%. The numbers looked pretty good – and he held on. However, the last two years of revenue growth have been 2% and 4% respectively. Slack Investor is not sure what is going on … but this company has not been growing. He sold at $8.69 this week.

Taking a loss … and moving on

This is a real skill – that doesn’t come easily – but is essential for managing a portfolio of growth stocks. Slack Investor is better at this than he used to be. Usually, growth stocks will come with a high Price/Earnings ratio as the future earnings growth will be factored into the price of the stock. These type of companies are particularly susceptible to a rapid decline in price when bad news emerges that might affect future earnings.

  “Some people automatically sell the ‘winners‘— stocks that go up— and hold on to their ‘losers‘— stocks that go down— which is about as sensible as pulling out the flowers and watering the weeds” – Peter Lynch – One Up On Wall Street

Slack Investor tries to adhere to the Peter Lynch philosophy when tending to his garden of stocks. He doesn’t always get these decisions right – but he does find it ‘cleansing’ to get rid of the bad performers. With experience, he has found that, more often than not, if there is a dramatic 1–2 day fall in a stock price (>15%) – it often takes a while to recover! Slack Investor is usually happy to take the loss and move his funds elsewhere. There is ‘opportunity cost’ in staying with a stock that is going nowhere.

Despite these bad performers, he doesn’t beat himself up about them. It is just part of investing. He takes solace that his whole portfolio is up about 8% in the 4 months of this financial year – and he does have good long-term results.

With the money raised from selling the dud investments, he bought into quality earnings with half the proceeds topping up his Supply Network (SNL) holding. The rest went into a new stock that he has been watching for a while – the logistics software business WiseTech (WTC).

The company had a price drop over a saucy scandal involving the founder and CEO Richard White. He resigned and Slack Investor is betting that these private-life dalliances should not interrupt the fine profitability (ROE 2026 20%) and established revenue growth (1-yr 2024 CAGR 20%) of this great Australian company.

1-YR Chart WiseTech Global – From Yahoo Finance

October 2024 – End of Month Update

Slack Investor is IN for Australian index shares, the US Index S&P 500 and the FTSE 100.

All markets drifted down slightly. As many of the big market crashes have occurred in September and October, Slack Investor is always relieved to get past this time of year.

For October, the ASX 200 (-1.3%), the FTSE 100 (-1.5%) and the S&P 500 (-1.0%).

All Index pages and charts have been updated to reflect the monthly changes – (ASX Index, UK Index, US Index).

Slack Investor goes to the Market

Fish Market (1574) – Joachim Beuckelaer

The takeover of Altium (ALU) has been done and Slack Investor had some cash at his disposal. At the end of April 2024, he went through the Slack Process of deciding which stocks to buy with the money that Altium was about to provide. In the spirit of this great company, he concentrated mostly on growth stocks and presented the list below.

The list of growth companies that Slack Investor would like to buy – after a filtering process that I carried out April 2024

Topping up existing stocks

Some of the stocks that Slack Investor owns are like old friends. He is always looking to add to ‘tried and true’ stocks with a good track record of growth and good management. All of the above were considered. However, as REA was already a large holding (7.9%), Slack Investor passed on REA. He did buy some TLX and also added to his holdings of TNE, SNL, NDQ, CAR and PME.

New Holdings

Profitability and Growth are two things that really impress. Slack Investor has been looking for smaller companies that have some potential. The newer stocks usually come from the financial press, newsletters and email subscriptions.

One thing he insists on however, is that they have a pleasing income chart that shows both historical growth (Black bars) and projected growth (Grey bars) – from Marketscreener.

Income growth and projected growth for XRF Scientific – From MarketScreener – Financial tab

As well as increasing income, Slack Investor likes his stocks to be profitable – a projected ROE (in 2026) to be more than 15%. He also wants them to be not too expensive – a projected P/E ratio (in 2026) of less than 40-50. Of course, he also screens for growth, using the 3-yr CAGR – and hope that it is also above 15%.

Slack Investor is not sure how any of these stocks will fare – but if you get the numbers right, good things will happen on most occasions. The 3-yr CAGR for Nick Scali is low at 8%, but past results were affected by COVID 19. Slack Investor has bought some NCK as they have just expanded into the UK and, if anyone can make this work, it will be the crack management team at Nick Scali.

CompanyTickerROE 2026P/E 2026CAGR 3-yrBuy Price Price 9/10
MegaportMP1253735 $9.03 $7.39
Nick ScaliNCK36138 $13.73 $16.13
XRF ScientificXRF182024 $1.55 $1.70
Betashares Diversified GrowthDHHF––– $34.01 $34.78
Botanix PharmaBOT2718– $0.37 $0.37
Betashares NextGen NASDAQJNDQ––– $15.47 $15.80
WebjetWEB/WJL162216 $9.03 $7.89
RPM HoldingsRUL15 (?)3918 $2.57 $2.86

These newer stocks are in the Slack Investor ‘nursery’ for now. Sometimes a company looks good on paper – but fails to keep growing for a number of reasons (often these reasons are opaque to Slack Investor)! While in the nursery, Slack Investor keeps a weekly watch and if they fall below the buying price by around 15%, he will usually cut his losses and sell.

This happened to Megaport (MP1). He sold the holding a few weeks ago for around $7.90. Webjet (WEB) has just gone through a stock split into WEB and WJL – and is on a close watch.

Slack Investor is off on holiday to Thailand tomorrow … and, has pushed this post out early (before his usual mid-month burst of activity).