Core Insights - The article draws parallels between the speculative excesses of the 17th-century "projectors" in England and today's AI-driven market euphoria, highlighting the risks associated with blind faith in technological progress and the dominance of passive investing strategies [21] Historical Context - England's late 17th-century economic prosperity was fueled by good harvests, foreign trade, and an influx of skilled immigrants, leading to a boom in joint-stock companies and speculative investments [3][4] - The term "projectors" initially referred to individuals promoting beneficial schemes but became associated with fraudulent activities during economic downturns [4][5] Market Dynamics - The current stock market is experiencing extraordinary gains driven by AI, reminiscent of the late 1990s internet bubble, but with significantly higher levels of global debt, which has increased from $64 trillion in 2000 to $338 trillion today [6] - Global stock market capitalization has grown from a peak of $44 trillion in March 2000 to $132 trillion as of September 2025, indicating a substantial increase in market size [6] Passive Investing Trends - Passive investing has gained dominance, with global ETF net inflows reaching nearly $2 trillion in 2024, while actively managed funds faced record outflows of $450 billion [10] - The rise of passive investment strategies has led to increased stock co-movement and reduced diversification, as these strategies are indifferent to fundamental information [8][11] Valuation Concerns - Current valuations in the stock market, particularly for the S&P 500, are significantly higher than historical averages, raising concerns about sustainability [13] - The article emphasizes that many companies' stock prices may not be justified by their ability to generate sufficient income, suggesting a potential misalignment between market prices and fundamental values [13][19] AI Investment Landscape - The six leading technology companies (NVIDIA, Microsoft, Apple, Alphabet, Amazon, and Meta) account for over a third of the S&P 500's market value, raising concerns about market concentration and vulnerability [15] - Despite significant investments in AI, a report from MIT found that 95% of organizations are not seeing returns on their AI investments, highlighting potential limitations in the scalability of AI technologies [17] Future Outlook - The article warns that the current market's optimism may be misplaced, as historical patterns suggest that high valuations may not be sustainable in the long term [20] - Investors are cautioned to focus on fundamental analysis and avoid speculative investments, particularly in the context of rising competition from Chinese firms in the AI sector [16][21]

Group 1 - Tokenised stocks have been launched globally in May, now available to South Africans through Luno, starting with over 60 US stocks and ETFs [1] - This development provides both retail and professional investors with instant access to major global companies such as Apple, Meta, Alphabet, Amazon, and Tesla [1] Group 2 - Historically, trading stocks required physical interaction with stockbrokers and traders, creating significant barriers to participation for most individuals [2] - The Johannesburg Stock Exchange (JSE) transitioned to digital stock certificates in 1999, reducing settlement times from two weeks to five days, while Nasdaq was the first fully digitised stock market [3] Group 3 - There has been a notable increase in market demand for stock investments, with a study indicating that the monthly share of individuals under 40 transferring funds to investment accounts has more than tripled over the last decade [4] - The 2022 Federal Reserve Survey of Consumer Finances reported that direct stock ownership among families rose from 15% in 2019 to 21% in 2022, marking the largest increase since 1989 [4] Group 4 - In South Africa, investment patterns have remained relatively stable over the past decade, but there has been a slight increase in equity investments since 2020 [5] - The share of equity and investment fund shares relative to total assets in South African households increased from 20.8% to 25.7% during this period, indicating a growing interest in stock market investments [5]

Market Overview - The third quarter was strong for the stock market, driven by AI enthusiasm, particularly in the information technology sector [3][4] - The ClearBridge Dividend Strategy profited from AI exposure but lagged the S&P 500 due to a disciplined risk management approach and underweighting in the IT sector [3][10] Market Concentration - The IT sector represents over 30% of the total market, with the top 10 companies accounting for more than 40%, both at all-time highs [4][9] Investment Strategy - The company maintains a traditional approach to diversification and risk management, benefiting from technology investments while reducing potential losses from AI market fluctuations [10] - The strategy focuses on dividend-paying stocks without rigid yield thresholds, allowing for flexibility in capital allocation [14][15] Performance Highlights - Positive contributions came from positions in Broadcom and Oracle, both of which are significant players in AI [16] - Defense holdings like Northrop Grumman and RTX performed well amid geopolitical tensions, while consumer staples lagged in a risk-on market [17] New Positions - New investments were initiated in Marsh & McLennan and Old Dominion Freight Line, with the former seen as undervalued and the latter recognized for its strong financials [18][19] Earnings and Valuation - Earnings are currently impacted by a weak volume environment, presenting attractive entry points for investment [19] - The outlook for the economy is mixed, with high valuations restraining capital appreciation potential [21] Dividend Growth - Dividend growers are viewed as ideal investments, providing income and preserving purchasing power in inflationary environments [25][24] Portfolio Performance - The ClearBridge Dividend Strategy underperformed the S&P 500 during the third quarter, with sector allocation being a primary driver of this underperformance [26][27] - Positive contributions came from Oracle, Sempra, and TE Connectivity, while Nvidia and Apple detracted from relative returns [28]

Group 1 - High net worth individuals (HNIs), family offices, and institutions are increasingly investing in AI and space technology over the past 12-18 months [1][5] - Platforms like Forge Global and Nasdaq Private Markets (NPM) are facilitating the buying and selling of unlisted shares, with NPM hosting shares of about 15,000 private firms and reporting $60 billion in trading volumes [2][5] - The global private secondary market has expanded to a $100 billion segment, with Forge's Private Market Index climbing 67.9% year-to-date [5] Group 2 - OpenAI's valuation has surged from $80 billion to nearly $500 billion within a year, while SpaceX's valuation increased from $210 billion to $350 billion [5] - As of the latest data, OpenAI shares were trading at $723.12, Anthropic at $162.15, and Databricks at $180 [5] - The performance of the "Magnificent Seven" stocks, including Apple, Microsoft, Nvidia, Alphabet, Amazon, Meta, and Tesla, remains a significant reference point for investors [5]

Google lost a US Supreme Court bid to pause major changes to its Google Play app store in an antitrust case filed by Fortnite-maker Epic Games https://t.co/1zB0yTxr7n ...

Core Viewpoint - Magnite's stock declined significantly due to the antitrust ruling favoring Google, which is perceived as a setback for competitors in the adtech space [1][4]. Group 1: Stock Performance - Magnite's shares fell 16% in September, reflecting investor concerns following the antitrust ruling that allowed Google to retain ownership of Chrome [2]. - The stock experienced a brief spike after Magnite filed a lawsuit against Google, but overall, it mostly trended downward throughout the month [3]. Group 2: Legal Actions - Magnite filed a lawsuit against Google on September 16, claiming financial damages and remedies for Google's alleged anticompetitive practices in the ad exchange and ad server markets [5]. - This lawsuit positions Magnite as the third supply-side platform (SSP) to take legal action against Google in recent months, indicating ongoing tensions in the industry [2][5]. Group 3: Market Context - Google remains a dominant force in the digital advertising industry, and its legal and operational decisions significantly impact competitors like Magnite [4]. - Despite the overall growth in the digital advertising market, Magnite's revenue only increased by 6% in the second quarter, highlighting challenges in achieving robust growth [8].

Core Viewpoint - The article discusses the historical performance of large-cap versus small-cap stocks, emphasizing that while large-cap stocks, particularly the "Magnificent 7," have dominated returns in the past decade, this dominance may not be permanent and could present an opportunity for small-cap investments [1][2][12]. Historical Performance - Over the last decade, the S&P 500 gained nearly 300%, with the Magnificent 7 stocks gaining 2585%, while small-cap stocks only gained 134% [1]. - The dominance of large-cap stocks is highlighted by their contribution of about one-third of the total gains of the S&P 500 [1]. Behavioral Bias and Asset Allocation - Investors have shown a tendency towards home country bias, favoring large-cap stocks due to their media coverage and perceived glamour [3]. - Since 2015, the average allocation to small-cap stocks in mutual funds and ETFs has decreased from 12% to 8%, indicating a potential over-reliance on large-cap stocks [2]. Importance of Market Cap vs. Style - The article explores whether it is more important for investors to focus on market cap or investment style, revealing that consistently choosing the correct market cap has historically yielded better performance than style selection [12]. - A study from January 1979 to August 2025 shows that large-cap stocks gained 12.3% per year compared to 11% for small-cap stocks, with a tracking error of 10% [8]. Valuation Trends - A decade ago, small-cap stocks traded at a PE multiple of 27x earnings compared to 19x for large-cap stocks; this valuation has since flipped, with small stocks now at 19x and large stocks at 27x [14]. - Small-cap earnings have grown by 9.5% per year, while large-cap earnings have grown by 8%, suggesting that small caps may now be undervalued relative to large caps [14]. Conclusion and Recommendations - The article suggests that investors may be under-allocated to small-cap stocks and over-exposed to expensive large-cap stocks, recommending a reconsideration of asset allocation strategies before potential market shifts occur [14].

You can just ask Google to break it all down and even ask follow ups. So you can keep up with every twist, turn, and sibling rivalry. Spoiler alert, it doesn't end well. ...

(Bloomberg) -- The US Supreme Court declined a chance to open social media companies to lawsuits over content recommended by their algorithms, turning away an appeal that accused Meta Platforms Inc.’s Facebook of radicalizing a man who killed nine South Carolina churchgoers. The rebuff ends a lawsuit filed by the daughter of Reverend Clementa Pinckney, one of the nine people murdered by white supremacist Dylann Roof in 2015 at a historically Black church in Charleston, South Carolina. Two lower courts had ...

Industry Trend - Self-driving cars are becoming increasingly common [1] - Google's Moonshots is ahead of the curve by sticking to their fail fast mantra [1] Innovation and Technology - Google's Moonshots @astroteller will share upcoming plans [1]