Sunday 21 January 2018

Swedish billionaire warns on valuations

Carl Bennet
Carl Bennet

Adam Ewing

Carl Bennet, a Swedish investor who built a $2bn (€1.75bn) fortune from a $30,000 bet made 30 years ago, says record-high stock prices are no reason to stop buying.

"There are opportunities," the 63-year-old, pictured, said in an interview in one of his Stockholm offices. "We're looking for opportunities in all the companies."

In Sweden alone, the benchmark index of the most traded stocks has soared almost 30pc in the past four months, touching a record last week. Over the same period the Stoxx Europe 600 index has surged about 20pc as record-low borrowing costs fuel demand for riskier assets. The extreme prices pose challenges for investors but shouldn't stop them hunting for good deals, Bennet said.

"I notice in some sectors they're getting more and more expensive," he said. "There's a lot of money in the market." Given the risk of paying too much, "it's important to not get carried away, which is something you have to tell yourself before going into a negotiation, because it's easy to get carried away", he said

Outside Sweden, Mr Bennet says the US remains attractive, even after the recent rally in the dollar. Sweden's krona has lost more than 20pc against the dollar in the past 12 months as the nation's central bank resorts to negative rates to fight deflation.

"Of course the dollar is reaching its fair value, but I feel it's strong, the US economy is good," Bennet said. "They have good education, they invest a lot in research and development, have flexibility in the market."

Through his holding company, Lifco, Mr Bennet has already made two acquisitions this year, UK-based Auger Torque, which makes earth drills and a Danish company that makes vehicle interiors.

Irish Independent

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