Philo Research

Philo’s comprehensive market, economic and investment research capability supports each of its 4 key areas of expertise:

  • portfolio construction and asset allocation
  • investment selection and blending
  • managed accounts
  • implementation support and consulting

Philo produces independent research which it makes available to its clients.  Given the commercial value of that research we can only reproduce a small sample of it on our public web site. However, we are keen to share some of our insights and so we offer a “Chart of the Month” with accompanying commentary that is pertinent in the prevailing market conditions.

We also provide an overview of the different research publications we offer, an outline of our processes for selecting investments and the chance to sample a selection of reports. 


Chart Of The Month - February 2015

 Australian Stocks - Nominal & Real Dividend Yields

Chart Commentary

Over the past seven decades in Australia the level of ‘real’ dividend yields across the market has provided a pointer to broad stock market rallies ahead.

The ‘nominal’ dividend yield is the aggregate level of dividends for the market over the most recent 12 month period divided by the current market index level. The ‘real’ dividend yield is the ‘nominal’ dividend yield less the current or most recent annual inflation rate. A similar measure also works for the US market. The chart shows the Australian market since 1980 noting the booms and busts.

When the real dividend yield reaches 2.5% the market rallies for the next several quarters. This measure pointed to all of the rallies through the 2000s credit/mining boom, the GFC, the sovereign debt crisis and QE boom, and it has also worked in all prior cycles since WW2 (except in the high-inflation 1970s).

In 2014 the Australian market was flat but at the end of 2014 the real dividend yield once again reached 2.5% indicating the market was likely to rally, and it has indeed rallied strongly. At the end of February the real dividend is still 2.5% (4.2% nominal yield less 1.7% inflation), providing support for our bullish stance.

1. Research Publications

Philo produces a number of regular research papers that are tailored to the needs of our clients. Common to each of these papers is Philo’s commitment to thorough analysis and attention to detail that sets it apart from its peers. 

Quarterly Review (Dynamic Asset Allocation Updates)

Philo’s flagship research report is its Advisers Quarterly Portfolio Review (‘the Quarterly Review’).  The primary purpose of the Quarterly Review is to update target asset allocations recommendations used within Philo’s portfolio construction framework.  This includes asset class and sub asset class recommendations for portfolios across a broad risk spectrum. 

The Quarterly Review methodology uses our proprietary process and models to build an in-depth analysis of macro-economic conditions accompanied by a ‘detailed review of asset class valuations and outlooks for the coming quarter and beyond.  This is overlaid by analysis of potential scenarios that could develop from the current situation and identifies the implications for each asset class.  We consider the probability of each outcome and develop portfolio recommendations accordingly.  The Quarterly Review also tracks the performance of prior recommendations via comprehensive attribution analysis.   

The result is a detailed recommendation of new target asset allocations for Philo’s model portfolios with full supporting rationale.  In our opinion it is the most comprehensive analysis of portfolio allocations published in the Australian market. 

The Quarterly Review is produced by the Philo team and reviewed by the Philo Portfolio Construction Committee which then approves the quarterly asset allocation targets as well as confirming portfolio construction rules, investment processes and classification schemes used within Philo. This committee has both internal and external members. For more information on Philo's investment committees, click here.

Samples of our Quarterly Review are not available via the website, but a comprehensive briefing can be arranged to explain our services and walk you through samples of our quarterly asset allocation reports as well as detailed fund and security reports.

Market Monitor

Early in every month Philo provides client firms with our house view on markets and economies via our Market Monitor publication.  This is a brief document that comments on topical issues, provides a view on market valuation and a brief assessment on the outlook for long run returns. 

Samples of the last 3 years of Market Monitors are accessible by clicking here.

Fund & Security Research & Profiles

Philo produces detailed reports that set out our views on individual managed funds and securities across the range of asset classes used within Philo portfolios.  We also produce summary profiles on a range of funds and securities.  There are no samples of these research documents available on this website, but samples are provided to parties undertaking a full review of Philo’s services.  The processes used to carry out our fund and security research are described elsewhere in this section of our website.

Vantage Point

Vantage Point is a research paper series intended for serious long term investors interested in understanding big picture events, developments and structural shifts and their impact on investment markets. This publication does not make asset weight or other recommendations but, rather, focusses on making sense of history and bigger economic trends. Vantage Point is distributed on a monthly basis via firms using Philo services to their clients. Samples of Vantage Point are accessible by clicking here.

Tales from the Trenches

Tales from the Trenches is a weekly commentary on market events, earnings announcements, AGMs and other important issues related to listed investments.  These can be found in the Philo Blog (Click here) where you can review articles and leave your own comments.

Stock Updates

Philo provides adviser firms with a brief summary and analysis of stock-specific announcements that occur during reporting season for Australian listed securities or at the time of some other material event.  This service is very popular amongst advisers as the commentary provides a snapshot of the key numbers, market reaction to the announcement and impact on client’s portfolio together with the rationale for holding (or divesting) the security.  There are no samples of these research documents available on this website, but samples are provided to parties undertaking a full review of Philo’s services.


2. On Balance… Philo’s White Paper Series

“On Balance…” is the name given to the white papers Philo produces from time to time.  Our goal in producing these papers is to stimulate industry debate on matters to do with portfolio construction and management and so we publish them here on this site as well as distributing them to those on our mailing list.  Click here to access available white papers.


3. Philo’s Blog

Philo produces a blog on this website that is designed to provide interested parties with access to succinct ideas and insights on investment related matters.  Anyone can register to receive Philo’s blog.  Please click here to go to the Philo blog home page.


4. Philo Research Methodology 

Philo’s research in listed securities and managed funds is conducted in accord with proprietary processes.  There is some variation in process depending on the type of investment being researched.  An overview of each major process variation is provided below, via the relevant link.  Research recommendations are reviewed by our Approved Investments Committee and, once approved, are added to Philo’s Approved Investments List. More information on our Investment Committee is available by clicking here.  As an indication of the level of scrutiny applied in our investment selection processes:

  • over the last 2 years, our listed research team has reviewed 85 securities in detail with only 8 being approved
  • over the year to 30 June 2013, our unlisted research team undertook a desk review of 125 funds, carried out an in depth review of 59 funds and ultimately approved 6 funds

To learn more about our proprietary research processes, please click on the relevant arrow heading below:

Listed Securities Overview

Listed Company Research Process

Listed Property Research Process

Listed Interest Rate Securities Research Process

Managed Funds

Compliance and our research process


5. Sample Our Research

A sample Vantage Point research report can be viewed by clicking on the corresponding PDF icon below.

Report Choices:
Title Subject Matter Released Link
Chasing the Dragon: Kicking the Tyres in China

We outline the main themes and findings from Philo's latest series of meetings across China to assess the outlook for China and its implications for our portfolios

 September 2014 Report initial pages
 Why rising US bond yields should be good for US shares

There is a widely held belief, supported by theory, that rising bond yields should be bad for share prices. But is this true in real life?

 December 2014
Report initial pages
US Deficits & Debt Three Roosevelts, three turning points and the current crisis  March 2013 Report initial pages
Buy & Hold or Buy & Hope? Separating fact from fiction for investors in the Australian stock market August 2012 Report initial pages
Follow the Leader Does the Australian stock market play "Follow the leader" to the US? If so, how and why? August 2012 Report initial pages
Good as Gold We answer some of the big questions about gold March 2012 Report initial pages
Japan’s March 2011 earthquake, tsunami and nuclear crisis – some thoughts for Australian investors Likely impact of crisis for investors over short,medium and long term Mar/Apr 2011 Report initial pages
Politics and Markets Market performance comparison under Liberal and Labor goverments Oct 2010 Report initial pages
The return of 30-year Australian government bonds: feast or famine for investors? Issues and opportunities around long term bonds Aug/Sep 2010 Report initial pages
Will Bricks and Mortar Turn to Water? Outlook for Australian house prices May/Jun 2010 Report initial pages
Have shares bounced back too quickly and too far? Self Explanatory Feb 2010 Report initial pages

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Please contact our Privacy Officer at the address below if you wish to access, update or correct your personal information, or if you have a complaint about how we have handled your details. We have a compliance process for dealing with complaints and we undertake to deal with your complaint as quickly as possible, and to keep you informed of its progress. 

Further information

You can obtain further general information about your privacy rights and privacy law from the Office of the Australian Information Commissioner by:

  • Calling their Privacy Hotline on 1300 363 992; or
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The Australian Information Commissioner
GPO Box 5218
Sydney NSW 1042


The Australian Information Commissioner
enquiries @ 


We may make changes to information handling and privacy policies and practices and this privacy policy. We will publish important changes on our web site and if necessary update this policy.   

Privacy Officer

Attention: the Privacy Officer
Philo Group

Level 11

37 York Street
Sydney NSW 2000

Tel: 1300 303 323

or send a message on Contact Us page


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This website is published by Philo Capital Services Pty Ltd ABN 91 154 859 284 and is operated by Philo Capital Services Limited and other companies that are associates of Philo Capital Services Pty Ltd including Philo Capital Advisers Pty Ltd ABN 70 119 185 974 AFSL 301808  (referred to collectively as the Philo Group).

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