Here’s what you need to know today

• The whole of the investing world was watching as Nvidia reported its third-quarter earnings. The result was a mixed bag. The positive? Revenue up 94% and profit more than doubled, with quarterly profit now larger than big-tech peers Amazon and Meta. The negative? Revenue growth is slowing, the past 3 quarters have seen year-on-year revenue growth of 122%, 262% and 265%, followed by 94% this quarter and projecting 70% for the next quarter. (CNBC | NY Times)
  
  

• Australia’s Future Fund, the $230 billion sovereign wealth fund, has been independent and apolitical since creation in 2006. Yesterday, Treasurer Jim Chalmers stepped very close to that line after directing the fund to prioritise investments in housing, renewable energy and infrastructure. This is the first time in the fund’s history that the government has prescribed specific asset classes the fund must consider. (AFR)
  
  

• The Australian government has introduced its law banning social media for Australians under the age of 16. The proposed law will fine social media platforms including Snapchat, Reddit, Instagram, TikTok, Twitter (X), and Facebook up to $50 million for failing to comply. The Opposition has said it will support the bill, meaning it could pass before Parliament breaks for summer. (Daily Aus)
  
  

• Bitcoin has reached a new high, crossing US$97,000 per coin. Bitcoin is now up 43% since Trump’s election and up 172% in the past 12 months. (CNBC)
  
  

• The Murdoch’s have successfully beaten the News Corp shareholder motion to remove the dual-class structure that gives the family 41% of the voting power with just 14% of the shares. At the company’s annual meeting yesterday, it was announced the proposal had been defeated (as was expected given the Murdoch’s voting power) (Guardian)
  
  

• Gautam Adani, India’s second richest man, and seven other Indian businessmen have been charged with securities and wire fraud by American prosecutors in connection to a solar-energy project. Prosecutors allege $250 million in bribes were paid to Indian officials and then the business made “false statements about bribery and corruption” as it tried to raise money from American investors. (ABC News)
  
  

• A few days after the US lifted restrictions on Ukraine using long-range missiles inside Russian territory, America has now agreed to supply Ukraine with anti-personnel landmines, something it previously had resisted. Humanitarian groups are outraged, pointing to the prohibition of anti-personnel landmines under the 1997 Mine Ban Treaty that 160 nations, including Ukraine, signed. (BBC)
  
  

• Hundreds of workers at a Hennessy plant in France went on strike as they protest luxury giant LVMH’s plan to move some bottling to China. LVMH’s plan is intended to circumvent China’s new tariffs on European brandy, imposed after Europe imposed tariffs on Chinese-made electric vehicles. (NY Times)

What the…?

Forbes 30 under 30 remains undefeated. Some of the biggest frauds of our generation have graced the Forbes list including Sam Bankman-Fried, Martin Shkreli and Elizabeth Holmes. (Read more on the Forbes Curse)

Now we can add another name to the list after founder of AI education startup and 30 under 30 alum Joanna Smith-Griffin was this week arrested and charged with securities fraud, wire fraud and identity theft. (Quartz)

Investing is a lifelong journey

Here’s what you can learn today.

This is an excerpt from our conversation with Cameron Blanks titled Expert: Cameron Blanks – 3 key lessons from 20 years of private equity deals (Apple | Spotify)

Question: Private equity outperformance. Let's start with the numbers. How has it outperformed public markets?

Over a very long period of time, it's outperformed somewhere between five and 10% on average. Obviously there's some sectors within the industry that have even done better than that, but just as a general rule, public equities over the long term have delivered something like 7 to 8% returns to invest. Volatility is in those numbers and private equity is typically about 5 to 10% above that and with less volatility as well.

In the area we focus most on - late stage buyouts -  there are three different things that differentiate and enable that outperformance.

1. Alignment. So this is getting alignment all the way from shareholders, through the board and into the management teams around incentives and strategy and execution. 

2. It’s really about active management. And what that means is spending time with the management teams as a private equity firm to make sure that they're executing the strategy and then helping them to execute that strategy. So that may be some analysis that helps with M&A or bringing in other specialists for other areas of the business.

3. We can take a long-term approach in private equity. We'd like to sell our businesses after three to five years, but if we need to, we can hold on for longer than that depending on market conditions or where we are on the business execution. So we have that flexibility, that long-term flexibility that doesn't really exist in the public markets. There's always a six month or quarterly reporting that needs to be done and it drives short-termism.  

So we'd put those three aspects down as the reason why particularly late stage buyout outperforms the public markets by a considerable margin.

Listen to the full interview wherever you listen to podcasts, or watch the interview on YouTube:

Today’s sponsor is First Sentier Investors

The pursuit of quality from the Australian share market

Some Aussie companies are leaders in efficiency. Others innovation. Some have mastered both and risen to global market leadership positions.

First Sentier Investors believe quality companies across the ASX 100 have what it takes to grow through market cycles. 

In pursuit of quality from the Australian share market, First Sentier Investors has geared quality ASX 100 companies since 1997.

Given the elevated risks of gearing, the team puts ‘quality first’ by pursuing liquid stocks with strong balance sheets.

Discover our best ASX candidates for gearing 

Want more Equity Mates?