MQG - Macquarie Group

[Garpal Gumnut]

Re: MBL - Macquarie Bank

Cheers Joe, it's been a dramatic fall out.....

I expected some fairly heavy selling, but MBL is where it was some two years ago in four weeks. I was expecting 70 as a first target, not 62. I also expected it would take a lot longer! Still, it's not the heaviest sold of investment bank - BNB and AFG have actually fared worse, and I much prefer BNB model from an operational perspective from MBL's.....

Interestingly, MBL have been the only ones not saying a thing about their exposure to the liquidity crisis - any rally IMO is a selling op, I would have thought there is more bad news to come from the "house that debt built"!

All the best guys, difficult trading conditions for anyone but the short seller ATM.

Cheers

I couldn't agree more.

The house that debt built.

Enclosed is a chart showing previous support and resistance in the low 40 level.

I wouldn't be surprised if it tested that again in the next few weeks.

Garpal

 

[Ken]

Re: MBL - Macquarie Bank

I think MBL will be a mess around $58 to $65 untill it builds again.

$40 out of MBL will not happen.

 

[Garpal Gumnut]

Re: MBL - Macquarie Bank

I think MBL will be a mess around $58 to $65 untill it builds again.

$40 out of MBL will not happen.

I bet you a meat pie it does. Its a debt play. Debt is not fashonable at present. It has inflated assets and overpaid staff. I like mine with peas.

Garpal

 

[Ken]

Re: MBL - Macquarie Bank

You're on.

Just a steak meat pie.

No sheppards pie.

If MBL goes to $40 you should be shorting it.

Are you currently shorting MBL? I think there is too much support around $60.00.

If it breaks down through $55 then $40 is more likely... cause theres no support at $50 or $45.

 

[Garpal Gumnut]

Re: MBL - Macquarie Bank

You're on.

Just a steak meat pie.

No sheppards pie.

If MBL goes to $40 you should be shorting it.

Are you currently shorting MBL? I think there is too much support around $60.00.

If it breaks down through $55 then $40 is more likely... cause theres no support at $50 or $45.

After watching London this evening and the first 1/2 hour of NY tonight and djia and ftse heading north it looks like I may have to buy you that pie. Lets see how it pans out.

Garpal

 

[Ken]

Re: MBL - Macquarie Bank

Well I need it cause I got MBL at $62 and sold out.

But the market is a funny place. There is no way the gains will hold on the US.

The market was up 600 points effectively in 2 days.

Thats some monster profits they will be taking.

But I do believe we are fairly close to bottom.

The effects of the sell off could mean when volatility stops the stocks ma drift back down a little.

Everyone is bargain hunting now but if the market rockets back up past 6000, you would think we are just in for more big sell offs...

All in all the volatility has spooked a lot of people.

I think the problem is real. As small miners will struggle to float companies now as it would suggust with AXE being over subscribed heavily but falling by 60%.

Adelaide uranium company has cancelled its float.

The market needs to settle, so dont over pay for the stocks that have fallen.

MBL will probably trade between $60-70 for a while.

Much like RIO traded between $70-$80.

Who knows? But not much has really changed. The housing problem in the US has been known for a while, the media have done a big job of ramping it.

If the market fell for no reason then it wouldn't be the stock market.

The media have to write something....

 

[Mofra]

Re: MBL - Macquarie Bank

Interestingly, MBL have been the only ones not saying a thing about their exposure to the liquidity crisis - any rally IMO is a selling op, I would have thought there is more bad news to come from the "house that debt built"!

reece55,

There is a simple reason why they wont comment on their exposure to the liquidity crisis.

They don't know.

Their overseas mortgage operations are safe (they do not offer low docs outside of Oz) and their existing securitised mortgage book in Aust. (AUS $20b+) is protected, as you have alluded to in earlier posts it is their ability to raise capital & conduct M&A that will be the primary activity curtailed by the recent volitility.

Basically, their fall has been very much a speculative one, the market guessing what the likely impact will be. With so much debt funding either complete or effectiovely passed on to investors, the short term picture doesn't seem anywhere near as gloomy as one would think. The medium term picture is where the interest lies.

Not often MBL is considered a yield play...

 

[reece55]

Re: MBL - Macquarie Bank

reece55,

There is a simple reason why they wont comment on their exposure to the liquidity crisis.

They don't know.

Their overseas mortgage operations are safe (they do not offer low docs outside of Oz) and their existing securitised mortgage book in Aust. (AUS $20b+) is protected, as you have alluded to in earlier posts it is their ability to raise capital & conduct M&A that will be the primary activity curtailed by the recent volitility.

Basically, their fall has been very much a speculative one, the market guessing what the likely impact will be. With so much debt funding either complete or effectiovely passed on to investors, the short term picture doesn't seem anywhere near as gloomy as one would think. The medium term picture is where the interest lies.

Not often MBL is considered a yield play...

Hi Mofra......

I'm more worried about their exposure to their trading arm.... Per their annual report, they 15.5 Bil held as trading assets - that's 2x net equity. In addition, they say Maximum daily value at risk is 15.22 Mil - however, this of course is based on 95% of market conditions - so my question is that in a situation that has occurred where we have conditions that are essentially black swan events happening all over the world, how have they fared? One stat I draw your attention to is the notional amount of their derivative contracts outstanding - $0.8 Billion Dollars AUD in March 07- a wrong move here could be deadly! Surely by now they know how they have fared in relation to trading instruments (in fact, they should be able to mark to market it on a daily basis). Or are they having problems mark-to-marketing their books because some of their investments no longer have a liquid market.

I think that if you review the chart, you will see that something is fundamentally wrong here. Is this a correction for MBL, or the beginning of a downtrend? In reference to your yield play comment, is it really a yield play if net profit is down 30% next FY, which it could very well be (especially if there are any impairment issues)? As the payout ratio is fixed (or relatively fixed), this would mean that the yield really would be exactly what it was at $90 at our now deflated price of $60.

I am also thinking about the medium term and the medium term is that debt is going to be a hell of a lot more expensive. Cheap debt and hot equity markets are what have made MBL a good (paper profit) business - lets see how the model lasts in the conditions we will be exposed to over the next couple of years.

Put it to you this way - if it rallies to above or about $75, I will be shorting the *&^* out of the stock. Just my independent view however.

All the best

 

[chops_a_must]

Re: MBL - Macquarie Bank

black swan events

Why oh why is our state's emblem blamed for everything?

Oh I see, bit of revenge for my SA jibe Lol!

Some of these managers need a good taste of Popper if you ask me...

 

[makybe_05]

MBL

Hey,
This is my first post on this forum and what I've seen so far it looks like a good place to hang around. Anyway, heres my dilemma. Ive got about $700 saved up through my part time job and i thought that i moswell invest it into the sharemarket seeing that ive had a few good experiences lately and its better than it sitting in the bank. Thing is that i want to sell these shares in at the end of the year for my motorbike. I am thinking Macquarie atm at maybe 68 if i can get it that low??. Just wondering what everyones thoughts are. Thanks so much in advance too by the way, glad that theres a few people that i can bounce some ideas off.

Also if i was to buy macquarie bank what do you think i should set my buying price at? Ive had a look at the market depth and by what ive seen it looks like it might be heading in the north direction again tomorrow, or i could just be completely wrong.

 

[Nyden]

Re: MBL

Hey,
This is my first post on this forum and what I've seen so far it looks like a good place to hang around. Anyway, heres my dilemma. Ive got about $700 saved up through my part time job and i thought that i moswell invest it into the sharemarket seeing that ive had a few good experiences lately and its better than it sitting in the bank. Thing is that i want to sell these shares in at the end of the year for my motorbike. I am thinking Macquarie atm at maybe 68 if i can get it that low??. Just wondering what everyones thoughts are. Thanks so much in advance too by the way, glad that theres a few people that i can bounce some ideas off.

Also if i was to buy macquarie bank what do you think i should set my buying price at? Ive had a look at the market depth and by what ive seen it looks like it might be heading in the north direction again tomorrow, or i could just be completely wrong.

Since you only have $700, and it's taken you a while to save that up - I would certainly advise in keeping it out of the market at the moment. Especially since (at least I believe?) you're inexperienced.

$700 into a relatively safe stock won't make you a lot of money, especially within a few months; even with current volatility, and at the moment, a spec (risky) stock is probably too risky.

Even if you manage to make 30% in a matter of months, your brokerage fees & tax would eat a lot of that up, as you're investing with a low amount.

Personally, I would keep the $700 in a savings account; at least until the market settles down, & you have a little more to invest.



But, it's great that you're thinking ahead, & saving for something you want!

 

[makybe_05]

Re: MBL - Macquarie Bank

Yea thanks for the advice. I think I'm going to buy say 10 MBL shares in the next couple of days. Ive got about $1000 worth of QBE, and I'm extremely pleased after todays profit results. Any other stocks that you would recommend?

 

[Mofra]

Re: MBL - Macquarie Bank

Hi Mofra......

I'm more worried about their exposure to their trading arm.... Per their annual report, they 15.5 Bil held as trading assets - that's 2x net equity. In addition, they say Maximum daily value at risk is 15.22 Mil - however, this of course is based on 95% of market conditions - so my question is that in a situation that has occurred where we have conditions that are essentially black swan events happening all over the world, how have they fared? One stat I draw your attention to is the notional amount of their derivative contracts outstanding - $0.8 Billion Dollars AUD in March 07- a wrong move here could be deadly! Surely by now they know how they have fared in relation to trading instruments (in fact, they should be able to mark to market it on a daily basis). Or are they having problems mark-to-marketing their books because some of their investments no longer have a liquid market.

I think that if you review the chart, you will see that something is fundamentally wrong here. Is this a correction for MBL, or the beginning of a downtrend? In reference to your yield play comment, is it really a yield play if net profit is down 30% next FY, which it could very well be (especially if there are any impairment issues)? As the payout ratio is fixed (or relatively fixed), this would mean that the yield really would be exactly what it was at $90 at our now deflated price of $60.

I am also thinking about the medium term and the medium term is that debt is going to be a hell of a lot more expensive. Cheap debt and hot equity markets are what have made MBL a good (paper profit) business - lets see how the model lasts in the conditions we will be exposed to over the next couple of years.

Put it to you this way - if it rallies to above or about $75, I will be shorting the *&^* out of the stock. Just my independent view however.

All the best

Howdy Reece,

Fair points - structure wise, the outstanding derivative contracts include hedging activity (the $15.22m at risk funds are the net risk from their trading activities after derivative positions are considered). As for not knowing the full impact of the recent volitility, this is more in relation to their system of asset valuation determining mangement fees drawn from subsidieries - up to date asset valuations would be cumbersome if done on such a regular basis. Treasury would know about positions & funds at risk up to the minute.

I still like the business model overall, yes there could be difficult times ahead but their core business is in reality risk transferance which can still profit in difficult market conditions. As for the yield play comments, no it was not a serious comment (three dots used to denote irony) but I'm sure the "click on commsec reserach, look at the PE & Div Yield, buy" crowd would be rubbing their hands together with glee.

Cheers

 

[barnz2k]

Re: MBL - Macquarie Bank

Yea thanks for the advice. I think I'm going to buy say 10 MBL shares in the next couple of days. Ive got about $1000 worth of QBE, and I'm extremely pleased after todays profit results. Any other stocks that you would recommend?

Id have to agree with Nyden. Though If you'd bought on Friday you might have made almost 10% yesterday , but its still crazy at the moment. Dual anns, 1 on either side - that another of their investments was hit, but new plans for funding helped the big recovery. So still going either way now. Of course I hope it goes straight up as im below my entry point now, but be cautious..

Example, currently Stgeorge is offering 6% on their dragon direct account - no term deposists, no fees etc. not much but better than nothing or negative.

 

[56gsa]

Re: MBL - Macquarie Bank

is this an inverted H&S??? although with descending neckline probably not to be trusted - could see a run to the 78-79 resistance - if high volume breakthough at that level then MBL may have turned?


from http://www.incrediblecharts.com/technical/head_and_shoulders.htm

Inverted Head and Shoulders

With inverted head and shoulders the neckline is drawn through the highest points of the two intervening peaks. A downward sloping neckline signals continuing weakness and is less reliable as a reversal signal.

The extent of the breakout move can be estimated by measuring from the top of the middle trough up to the neckline. This target is then projected upwards from the point of breakout.

Volume Confirmation
High volume on the first trough,
Moderate volume on the second trough,
High volume on the second peak,
Low volume on the third trough, and
A sharp increase in volume at the breakout.

Trading Signals
Go long at breakout above the neckline.
Place a stop-loss one tick below the last trough.

There is frequently a correction back to the neckline, which then acts as a support level. Go long on a reversal signal and place a stop-loss one tick below the support level.

Never trust an inverted head and shoulders pattern where the neckline is clearly descending (the second peak being lower than the first). The more level the neckline, the more reliable the pattern.

 

[Fab]

MBL

I am not sure if there is an existing thread on MBL as I could not find one when doing a search (surprising so). Please merge if this is the case.
MBL looks surprisingly cheap at current level. Recommendation from ABNAMRO remains at $110. It is currently trading at $77. There is a large possible upside there. I am wondering if anyone has done any technical analysis on this stock and how it looks like in the short term. Looking at some CFD trading on it.

 

[zt3000]

Re: MBL - Macquarie Bank

MBL From low of $70 on the 10th sept has moved to nearly $84 today. 18.5% gain.

Are we due for a "breather" before the next bolt?

Technical and Fundamental analysis welcome Thanks

 

[shares]

Re: MBL - Macquarie Bank

has anyone else received the 'explanatory memorandum'?

"proposal to restructure the macquarie group which will result in a new non operating holding company macquarie group limited becmong the ultimate listed parent entity of the group"

it is a 200 page restructure booklet outlining key issues surrounding the restructure. 1 current mbl share (record date 12 Nov) will equal 1 macquarie group limited share if the memorandum is passed.

 

[barnz2k]

Re: MBL - Macquarie Bank

If i have been sent it I wont see it cause im overseas..
This could be good or play havoc on the share price.
Would "MGL" then encompass more of their divisions or something?

 

[Awesomandy]

Re: MBL - Macquarie Bank

The restructure is basically to get around the current regulations that it has to have a certain amount of capital on the balance sheet before it can make acquisitions. Just think of it as MBL borrowing money to buy itself. There's nothing to worry about, really. If MBL was based overseas in the first place, the regulations there would mean they don't need to do this to get around the Australian regulations.