ASX's September Hiccup Winners

Over the last week since the end of August, the ASX has fallen 4.5.

That’s a reasonable fall for less than two weeks’ trading.

We look forward to these market falls to help position portfolios for the next group of market-leaders.

In the recent market fall, companies from large ones like Commonwealth Bank (CBA), Macquarie (MQG) and Oil Search (OSH) to Cochlear (COH), fell.

Small market leaders from Aristocrat (ALL), Blackmores (BKL), Elmo Software (ELO), Fisher & Paykel Health (FPH), Lend Lease (LLC) and Liquefied Natural Gas (LNG) to Xero (XRO), also all took considerable hits to their share prices.

This begs the question: “are there any companies that have performed well?”

Yes, these companies are:

CHORUS LIMITED [CNU]

CAPILANO HONEY LIMITED [CZZ]

DEXUS PROP [DXS]

ENERO GROUP LIMITED [EGG]

THE CITADEL GROUP LIMITED [CGL]

FREEDOM FOODS GROUP LIMITED [FNP]

INDUSTRIA REIT [IDR]

Although picking top performing names in this case is simply reporting on a change in numbers.

The greatest insight from markets falling is what we call the “Beta-Drive”; it has three distinct phases:

1. When the markets turn, money floods into markets with more speed and less tact – often going to the largest names; the companies with the highest Beta;

2. Somewhere from 2-5 days after the turn, the smaller companies join the rally and move up;

3. Normally between 7-10 days after the rally has started, the high Beta companies start to flatten out, or fall back down. This leaves only the stronger companies to keep rising in price.

Throughout this process, the next market-leading trends are identified in what we call 'rising from the ashes'.

Watch Talking Stock to see the leading companies and themes identified.