The Brexit And UK-Exposed Australian Listings

This story features PLATINUM ASSET MANAGEMENT LIMITED. For more info SHARE ANALYSIS: PTM

By Michael Gable 

Last week saw the S&P/ASX 200 Index hit our downside target by closing at 5145. It then bounced from that support yesterday as fears of Brexit eased slightly. If our market cannot close above the previous swing low of 5278, then our opinion is that we now in a messy 4th wave which implies one more test of levels 5100 or lower. With the current volatility, it pays to be patient. This also applies for trying to make a nice profit out of the Brexit result. If the UK votes to leave, and we should start to be certain of this by about lunchtime Friday, then we can step back into Gold or the US dollar. If they decide to stay, then there are a range of stocks that could benefit.

We have had a look at the charts and valuations, and the three that stand out are Henderson Group ((HGG)), CYBG Plc ((CYB)), and Platinum Asset Management ((PTM)). HGG has already jumped so it is advisable to wait for short-term profit taking. PTM is still looking quite good here and we have put a chart of PTM in today's report. It is also worth mentioning that HGG and PTM pay a decent dividend with the next ex date at the end of August. Our advice is to wait till Friday at the earliest. If you can't get set at a good price, then something else will come along. There's no point chasing it.
 

We saw a very bullish candle (circled) in early March when the shares rallied over 10% in the space of a week. They have come back since then, but correcting back for three months and not being able to overcome only a week's bullish price action is therefore a positive sign. Levels here near $6 represent a buying opportunity, as PTM seems poised to springboard higher. We can see resistance near $6.50 and then $7.25.
 

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Michael Gable is managing Director of  Fairmont Equities (www.fairmontequities.com)

Michael assists investors to achieve their goals by providing advice ranging from short term trading to longer term portfolio management, deals in all ASX listed securities and specialises in covered call writing to help long term investors protect their share portfolios and generate additional income.

Michael is RG146 Accredited and holds the following formal qualifications:

• Bachelor of Engineering, Hons. (University of Sydney) 
• Bachelor of Commerce (University of Sydney) 
• Diploma of Mortgage Lending (Finsia) 
• Diploma of Financial Services [Financial Planning] (Finsia) 
• Completion of ASX Accredited Derivatives Adviser Levels 1 & 2

Disclaimer

Michael Gable is an Authorised Representative (No. 376892) and Fairmont Equities Pty Ltd is a Corporate Authorised Representative (No. 444397) of Novus Capital Limited (AFS Licence No. 238168). The information contained in this report is general information only and is copy write to Fairmont Equities. Fairmont Equities reserves all intellectual property rights. This report should not be interpreted as one that provides personal financial or investment advice. Any examples presented are for illustration purposes only. Past performance is not a reliable indicator of future performance. No person, persons or organisation should invest monies or take action on the reliance of the material contained in this report, but instead should satisfy themselves independently (whether by expert advice or others) of the appropriateness of any such action. Fairmont Equities, it directors and/or officers accept no responsibility for the accuracy, completeness or timeliness of the information contained in the report.

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