Published on 21 July 2022
By Tui Eruera, CEO and Founder of Jaaims
The weeks ahead will be critical for investors – and the upcoming reporting season will see Jaaims showcase the power of AI.
The past few months have seen sharemarkets rocked by volatility. These bouts of rapid ups and downs are normal in the overall scheme of sharemarket activity. But they often see investors react by bailing out or buying up to take advantage of perceived discounts.
So, it’s been interesting to see that Jaaims has taken a very different approach.
After several weeks of sitting tight, Jaaims has just started to open positions. The algorithm is particularly interested in companies that can pass on costs such as Woolworths here in Australia, and Johnson and Johnson (listed on the US market).
This reflects the view we recently expressed that an inflationary environment can deliver opportunities. Now is certainly a time for investors to consider how well sectors and individual companies are able to adjust their pricing ahead of inflation, or whether they are price resilient.
However, it is the upcoming reporting season that will truly highlight Jaaims’ ability to rapidly analyse – and act on – immense volumes of data.
The company reporting season approaches
The company reporting season is a key date on the investment calendar.
ASX-listed companies are required to report their financial results to shareholders within two months of their financial year-end. Most listed companies have a 30 June balance sheet date, so the main reporting season is in August.
That’s when we’ll be inundated with companies providing details of their profits – or losses – for the 2021/22 financial year.
In some cases, companies give a heads-up that past or future results won’t be as good as anticipated. BHP’s CEO Mike Henry for example, recently flagged a cautionary outlook based on inflationary pressures, a tight labour market and ongoing supply chain issues[1].
Traditionally though, the reporting season offers a rich vein of information on which to base investment decisions.
The downside is the sheer volume and complexity of information available. Anyone who has ever pored through a company’s annual report will know they don’t make for light reading.
Rapid annual report analysis – and bias-free stock recommendations
Reporting season will highlight the value of Jaaims’ technology. And it’s going to be a particularly interesting reporting season this year as we learn how companies are navigating rising interest rates, inflationary pressures and managing continued disruption to supply chains.
The Jaaims advantage is not just about speed of analysis. Importantly, Jaaims makes stock recommendations free from human bias.
Research tells us for instance, that investors can spend as little as 15 minutes thumbing through a company’s annual report – and it can be the photographs and imagery contained within a report that influence an investor’s views [2].
Fortunately, glossy photos and other curated images are not something Jaaims takes into account when making stock recommendations.
We’ll keep you posted on how Jaaims is making sense of the current sharemarket opportunities – especially as we head into the upcoming reporting season.
Any advice provided is general in nature and does not take into account the viewer’s specific needs and circumstances. You should consider your own financial position, objectives and requirements to determine the type of advice and products to best suit your needs. Jaaims Australia is an Authorised Representative of Jaaims Technologies, AFSL 519985.
[1] https://cdn-api.markitdigital.com/apiman-gateway/ASX/asx-research/1.0/file/2924-02543130-3A597390?access_token=83ff96335c2d45a094df02a206a39ff4
[2] https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.980.1789&rep=rep1&type=pdf