The Market Wrap 31-5-13

By Jason Fittler

Another down week for the market but we are not alone with market across the globe all down as well.

The falling markets can be traced back to the comments last week from Ben Bernanke that the Federal Reserve will be reducing their monetary policy assistance of buying bonds.

Given the reaction to this announcement I expect that we will see weakness in the market for some time providing opportunity to pick up some quality companies at more reasonable price.

We are starting to see the slowdown of the yield investor coming out of cash and into the banking sector.

The bigger end of the market (fund managers) will be looking to position themselves before the Federal Reserve starts to slow down the monetary policy. This will cause continued volatility in the market place, which provides opportunity.

It is always tempting to cash up and try picking the market moves but this strategy is high risk.

We continue to hold companies with high yields, strong cash and low debt.

We continue to look for buying opportunities in out of favour companies to add to the portfolio.