938 is AI the new dot-com, selling winners, property post-budget + more

Glen James (0:06)

Today on the show, we are answering your questions as per my last email, and I'm coming to you live from Melbourne, not live, pre-recorded. Hey, we'll date Stanford anyway. Recording this on the 8th of September, it's going up on the 22nd of September, joined by Owen Rask from Rask. Welcome, Owen, to your own studio.

Owen Rask (0:26)

Thank you, mate. It's great to be here. Thanks for having me.

Glen James (0:28)

Yeah, you fit right in here.

Owen Rask (0:29)

Thank you.

Glen James (0:29)

It's really bizarre. So, look, a couple of housekeepingy things. We're going to run this episode. Owen's going to top and tail it and put it up on the Australian Finance Podcast. So, if you're like listening to white guys in middle ages with receding hair and all that, you can check out the...

I've just shaved my head, Owen, by choice, everyone. You can check out the Australian Finance Podcast, and we're going to get right into it. When to sell down high-performing satellite ETFs? I have a few like Asia and semiconductor ETFs that have grown by more than 200%.

Should I sell half, put in my core, to reduce risk? What are you... Like, you're in this investing world.

Owen Rask (1:20)

Yeah.

Glen James (1:20)

Actually, I think I've seen last time we talked about selling winners.

Owen Rask (1:24)

I think we talked about someone like...

Glen James (1:26)

Someone had a gold with 80%.

Owen Rask (1:28)

Yeah. And I can't remember what we said is the answer. So forgive us.

Glen James (1:31)

Yeah. Buy more.

Owen Rask (1:32)

Yeah. Go hard. It's working.

Glen James (1:34)

Yeah.

Owen Rask (1:36)

I would just say, like all good in good things in finance, if you have some sort of end in mind, it tends to be an easier journey for you, right? Yeah. So like 200% that's Semiconductor ETF. The Asia, I think when they say Asia, I think they're referring to Asia Technology Tigers, which is the ETF from Betashare that invests in tech companies out of predominantly China.

Glen James (2:00)

So maybe, because yeah, I have a few like Asia, which would be the one that you're talking about and Semiconductor.

Owen Rask (2:07)

Yeah. So Semi is from GlobalX.

Glen James (2:09)

That's the Robo advice or is there a Robotic? What's the Robo, R-O-B-R?

Owen Rask (2:13)

R-B-T-Z. There's two. There's Robo and then there's R-B-T-Z. But Semi is the one that, as it sounds, invests in Semiconductor stocks.

Glen James (2:23)

Stonks.

Owen Rask (2:24)

Stonks.

Glen James (2:24)

Yeah.

Owen Rask (2:25)

Well, and if you were to say real quick answer, which one of my would, would I be more concerned about having gone up so far? It would be the Semi one that has absolutely monstered it. But the reason I'd be more concerned is many of those companies, while their share prices have gone up, they are kind of earlier in their journey. And the reason they've gone up is because of the AI thematic.

Whereas Asia Technology Tigers, it's just standard tech companies.

Glen James (2:51)

But this was, I mean, similar, but not the turn of the century, the dot-com thing, mouse could walk across a keyboard, start a website and be worth millions of dollars. But it's only getting lifted because that's not to say that Semiconductor and these companies are doing well. But when we have this hyper growth in sectors, it's all good until it isn't.

Owen Rask (3:13)

Yeah, oh yeah. And there's a very strong cohort of really respectable people saying that we are firmly into bubble territory right now. The one thing to keep in mind, yeah, like you said, mouse is on keyboards and that. I think one of the big differences is whether or not people went to pets.com and they got paid. Basically, the company of the era was pets.com as this amazing modern company that was literally just a URL. And if they got clicks, they got billions of dollars in market capitalization or valuations. That's very different to a company now.

That's got substance.

SPEAKER_3 (3:50)

Yeah, it's actually doing something.

Owen Rask (3:52)

Yeah, it's actually doing something. And we know that while the internet was a great thing, it ultimately became democratized through open protocols. The way the internet runs, no one owns the internet, so to speak, although the US could probably shut it down.

Whereas with AI, it is very much like you need memory, you need compute, you need electricity, you need semiconductor chips, all this sort of stuff. For this type of portfolio, and anyone's portfolio that has a core in satellite, it's just having predetermined rules around how much do you want in a satellite. I find a lot of people that end up in these things often do so because they didn't have an end in mind. They weren't like, oh, well, I'm just going to have 20 to 30% in my satellite and the rest is core. And you've got to honor your earlier person to say, I'm not just going to let this thesis creep, I'm actually going to sell.