Hello and welcome to the rules of investing, brought to you by Livewire Markets. I’m your host David Thornton.

A year ago I sat down with Oscar Oberg, lead portfolio manager at Wilson Asset Management. His thesis then was that small caps were beaten down and due some mean reversion.  

Alas, small caps haven’t done much since then, with the Small Ords returning 3.91%. Yet Oscar’s thesis also remains unchanged. In fact, it’s gotten stronger!

Not only is he positioning for a rebound in smalls and microcaps, he’s doing it with overweight exposure to consumer discretionary, a sector that has been tarred and feathered by today’s macroeconomic landscape of high inflation and high rates. As Oscar puts it, “there’s no mean reversion without consumer discretionary.”

In the upcoming episode, Oscar lays out this thesis and the companies that make it up. He also discusses the relationship between the tech rally and small caps, generating return with short-term tactical trades, how he deals with low liquidity, and the primed aged care stock currently under takeover.  

Here’s a taste of what you can expect.