Stocks to buy now QE3 is over

Chairman, Wilson Asset Management
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Key points

  • The end of QE3 could mean further volatility but the US is in a much better shape than before.
  • Its end removes a source of upward pressure on the Aussie dollar, which could fall towards $0.75.
  • Companies like Aristocrat Leisure, Ansell and Brambles will benefit from a lower Aussie dollar.

 

After five years of quantitative easing in the US and after $US4.5 trillion of liquidity entered the market, the aggressive "pump priming" from America is over.

What does this mean for an investor?

The first thought that comes to my mind is concern. The extra liquidity that has been pumped into the system has been forcing up asset prices across the globe, particularly in the stock market. Since the US market bottomed on 6 March 2009 at 666, the S&P 500 Index is up over 200%. However it hasn’t been smooth sailing.

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