Monthly, we update our wholesale investors on what’s happening in the market. Running what’s probably the only late-night trading desk from New Zealand, we’re well-positioned to feel the pulse of the market’s direction.
I had dinner with a friend recently who showed me his portfolio: all US tech, well over $2 million. He’d leveraged a commercial property to buy in further. This month has been tough on him, and he asked me to take a look.
I told him: ‘Well, if things turn around, you have major upside. The danger is that this rotation out of high-priced tech keeps running.’
The restaurant was full of beautiful people, and the ‘Italian’ food was priced like a Nasdaq growth stock. They still asked for a tip. It was a reminder that markets, like menus, can demand a premium that isn’t always justified.
Source: Holger Zschaepitz / X
July proved to be an ideal month for value-scroungers.
The on-again, off-again nature of the Iran conflict created pockets of volatility. Enough for some investors to lose their nerve and sell down, especially those covering margins.
John and I were happy to back up the truck and add value across our key growth and income targets. Windows were small, with prices flexing back quickly on any sign of happier times.
From the rearview mirror, three forces defined July:
1) Rotation away from tech / AI
Investors are questioning how and when capital expenditure will pay off. High-priced tech has become vulnerable to sentiment shifts. When you pay a lot for something, the line of patience can soon wear thin.
2) Rising oil prices on geopolitical tension
This has shifted the interest-rate story back toward potential increases. Here in New Zealand, a diesel price surge of more than 70% effectively burst the inflation dam. And some of that pressure traces back to political choices, including Labour’s decision to shut down the Marsden Point refinery. That helped set the stage years before, didn’t it?
3) Strengthening of the Kiwi dollar
New Zealand’s 4.1% inflation print on 21 July did afford one trading advantage. It boosted the currency. A stronger Kiwi dollar gave us better offshore buying power. A welcome tailwind during bouts of volatility.
Of course, this has also contributed to some drawdown across existing portfolios — invested offshore but denominated in NZD.
Meanwhile, our energy exposure and increased buying into the sector — including a new opportunity — positions us well for the future.
Strong holdings in value financials and resources should also benefit from any further interest-rate uncertainty.
When the war ends and fuel flows again unrestricted, we expect our real-estate positions to jump. These have provided excellent buying lately.
Managed Account performance*
For the month of July 2026, we were down –2.73% across the composite portfolio (total aggregate TWR return across all portfolios following the strategy).
Our average annualised return since inception is 13.51% p.a.
Please see our performance chart for more details.
Benchmarking
Our MSCI EAFE benchmark was up 1.16%.
The S&P 500 benchmark was up 0.09%.
Our blended MSCI EAFE/S&P 500 benchmark was up 0.10%.
Looking ahead
The market remains cautious, rotational, and inflation-sensitive. Patience is in short supply.
In our view, this is an ideal environment to accumulate value for the future.
As for my friend, he’s a skilled businessperson. He may well be right long-term on some of the tech names he holds. But in the portfolios we build, we want to protect the downside and compound income along the way.
Regards,
Simon Angelo
Editor, Wealth Morning
*Past performance is not an indicator for future performance. Your actual portfolio will differ from the composite portfolio mentioned. The information contained in this document does not constitute an offer to sell or a solicitation to buy an investment, nor should it be construed as investment advice. Wealth Morning Managed Accounts are available to Eligible Investors and Wholesale Investors (not to Retail Investors) as defined in the Financial Markets Conduct Act (2013).
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John is the Chief Investment Officer at Wealth Morning. His responsibilities include trading, client service, and compliance. He is an experienced investor and portfolio manager, trading both on his own account and assisting with high net-worth clients. In addition to contributing financial and geopolitical articles to this site, John is a bestselling author in his own right. His international thrillers have appeared on the USA Today and Amazon bestseller lists.