The veteran stockpicker is so bearish on Australia’s economy that he’s looking to the powerful dynasties in Europe to drive returns.
Yogi, soccer fan and veteran stockpicker Andrew Brown has just launched a fund that mainly invests in companies that are backed by some of the world’s richest families. Brown is no trust fund baby, though. He grew up in Britain’s Scunthorpe, before landing in Sydney in 1987 as a bank analyst at Baring Securities as part of a 39-year investment career.
The fund manager has run his own investment company, East72, since 2016 which includes managing a hedge fund until it was wound up last year. He says his fascination with family dynasties and wealth protection started after he worked for the Rothschild family between 1997 and 2003.“There are studies in Europe and Canada about how family companies outperform the wider market and the reason is they have stable management and tend to be countercyclical to sell assets when times are good.
“Google and Meta are led by first generations,” he says. “But a lot of the companies we own are into fourth and fifth generations and the ethos has been passed down. One of the keys things is to make sure the next-generation family don’t fight, or have a bunch of clowns running it.”The diversified investment company of Italy’s Agnelli family, Exor, is another holding and makes up around 2.5 per cent of the fund’s net asset value.
“The amount of government money pumped in over 2020 and 2021 was massive. What the RBA should’ve done is say, ‘we need to temper this a little’, but of course they did the opposite, they fuelled it by saying ‘no rate rises to 2024’.
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