Here’s what you need to know today

• Good news for Australian emissions. Australia has celebrated its largest annual drop in emissions (outside the COVID shutdown years). Emissions dropped 2.2% in the last financial year driven by a record amount of renewable energy generation coming online. Early forecasts for the September quarter suggest an even larger annual drop of 2.8%. (ABC)
  
  

• Black Friday breaks records. The data emerging from Black Friday suggests that consumers are holding up alright. In the US, spending was up 5% on last year, with online shopping growing at 5.3%, slightly faster than the overall number. Data hasn’t been released for Australia yet, but expectations are of a similar story. (Reuters)
  
  

• US market recovers. So much for that market fall. At one stage in November, the S&P 500 was down 4% for the month. But a strong last two weeks saw the S&P 500 grow 0.1% in November. This marks the 7th successive month that the US market was up. (AFR)
  
  

• Corporate Travel Management in serious trouble. The Australian company was found to have ripped off its British customers (including the UK Government) to the tune of £80 million (A$162 million). Corporate Travel Management has A$148 million cash in the bank and has been in a trading halt since August after new auditors found “material errors” in its accounts. (AFR)
  
  

• Airport chaos as Airbus grounds planes. Airports around the world were scrambling this weekend as Airbus announced a “significant number” of its A320 aircraft would need to be grounded for a software update. In Australia, Jetstar reported 34 planes were grounded, affecting more than 90 flights. (Reuters)
  
  

• Australia’s huge round of regulatory reform. Australian Treasurer Jim Chalmers and his state and territory counterparts have agreed to a huge range of regulatory reform. This includes extending the ‘right to repair’ to agricultural machinery, legislating the ban on non-compete clauses, streamlining approval pathways for data centres, and harmonising standards for household electrical consumer goods. These were all suggestions that came from the government’s Economic Reform Roundtable held earlier this year. (Capital Brief)
  
  

• Microsoft wants more Australian data centres. Data Centres Australia, a new Microsoft-led lobby group in Australia, has launched with grand plans to put Australia at the centre of the AI infrastructure conversation. Key members include Microsoft, Amazon, NextDC, CDC Data Centres and AirTrunk, who together account for 80% of Australia’s data centres. (Capital Brief)
  
  

• Japan and China relations continue to deteriorate. The recent spat started when Japanese Prime Minister Takaichi Sanae, told Parliament that a Chinese invasion of Taiwan would be a “survival threatening situation” that would justify use of Japan’s self-defence force. China has responded aggressively, including this comment from China’s counsel-general in Osaka, “If you stick that filthy neck where it doesn’t belong, it’s going to get sliced off”. (The Economist)
  
  

• Ukraine’s corruption scandal grows. President Zelensky’s chief of staff Andriy Yermak was forced to resign after anti-corruption agents raided his home. Yermak had been a powerful player in Ukraine’s wartime government and was leading the peace negotiations with Russia. (Bloomberg)
  
  

• Eight arrested over Hong Kong apartment fire. This comes as the death toll of the Hong Kong apartment fire has risen to 128 people. The eight people arrested were linked to renovation works at the site, as authorities pointed to styrofoam panels used during renovations as a key reason for the fire spreading. Hong Kong authorities have also pledged to end the use of bamboo scaffolding in the aftermath of the horrific tragedy. (ABC)

What the…?

Gustav Klimt’s ‘Portrait of Elisabeth Lederer’ has recently become the most expensive piece of art created in the 20th century. It sold at auction for US$236.4m (A$366.4m). Overall, it is the second highest price paid for any artwork, behind Leonardo da Vinci’s ‘Salvator Mundi’ which sold for US$450m (A$697.5m) in 2017.

That wasn’t the only high-priced piece of art sold at Sotheby’s that evening. A solid-gold sculpture of a toilet, titled ‘America’, made with almost US$10m of gold sold for US$12.1m. The toilet was reportedly plumbed to flush, but the auction house didn’t have a ‘try before you buy’ policy. (ABC)

Investing is a lifelong journey

Here’s what you can learn today

Community question: Should I invest more in ETFs or individual shares?

Bryce and Ren help a community member with whether they should invest more in ETFs or individual shares in the Equity Mates Investing episode titled ‘Buffett’s big mistake, Bryce’s 10-bagger quest & your portfolio construction questions, answered.’ (Apple | Spotify | YouTube)

Sheridan: Hi, my name's Sheridan. I've been listening about 12 months, started investing into shares six months ago. I invested right before the market fell—great timing—but it seems to have recovered. I've got a core portfolio of ETFs—eight of them—and a separate portfolio of 14 ASX-listed companies. I can't decide whether to keep investing into ETFs or pick more individual shares. If this was your portfolio, what would you decide and do differently?

Ren: Thanks for the question Sheridan. Bryce, if this was your portfolio, what would you do—with the caveat we don’t know your goals, time horizons, or risk tolerance.

Bryce: With my goals—long-term, financial independence, high risk—I’d start by simplifying the ETF portfolio. Without knowing which eight ETFs, I’d aim to reduce to four or fewer for broad-based index exposure. Any more than that would likely be thematic—I’d keep an eye on those. The 14 listed companies? Classic core-satellite approach. Nothing wrong, just check there’s not overlap with your core—e.g., don’t hold ASX 200 plus BHP, Commonwealth Bank separately. Also ensure you have strong theses for all 14. It doesn’t have to be ETFs vs. stocks. You can DCA into your ETF core and still buy individual shares when there’s opportunity.

Ren: Yeah. I’d ask what weight you want between core and satellite—maybe 80/20, 60/40, but at least the majority in core. Then allocate cash based on your target weighting. Eight ETFs feels high—what are 6, 7, 8 doing? If they have a purpose, fine. On the satellite side, your overall portfolio is already diversified, so don’t worry about diversifying your satellite. Focus on companies you think will grow faster than your core—where you have high conviction.

Bryce: Also, look at other markets. 14 ASX-listed is great, but there's a whole world out there. If you’ve got access to international markets, get around it.

Ren: Yeah, thanks Sheridan. You can ask us a question at equitymates.com/contact

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