Money

Issue No. 37 - October/November 2007

Prime time to buy blue chip: Gobbett

by Darryl Gobbett

Australian investors who blindly follow the “US-obsessed share market herd” risk missing out on good buying opportunities among local stocks.

That is the view of wealth management and stockbroking firm Prescott Securities, which is optimistic about the outlook for the Australian share market despite the volatile vital signs.

Speaking out in the midst of turmoil shortly after news of the American sub-prime disaster broke, Prescott Securities Chief Economist, Darryl Gobbett, said the US-based mortgage issues that spooked many local investors did not signal the start of a major bear run on the world’s stock markets.

Events have proved him right, and other financial experts concurred the sub-prime effect would be limited outside financial sectors. According to ANZ guru Saul Eslake, the crisis would have the benefical effect of widening the margin between high-risk and low-risk investments, which had grown alarmingly narrow.

“The share market herd is o...

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