What got the team talking this week - Firetrail Investments

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What got the team talking this week

May 22, 2025

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Built, but not bought

Inventory of unsold homes in the US continues to rise, now at 120k units – up 50% from the prior peak. But demand isn’t keeping pace. Mortgage rates remain elevated, and data from the University of Michigan shows that 44% of consumers believe it is a bad time to buy a house because of high mortgage rates and tight credit conditions.

Number of unsold homes is rising:

Source: U.S. Census Bureau, U.S. Department of Housing and Urban Development (May 2025)

Mortgage rates remain elevated:

Source: Freddie Mac, BEA, Bloomberg, Apollo Chief Economist (May 2025)

AI that can understand, think and act…

The NVIDIA keynote at COMPUTEX spotlighted the next evolution of artificial intelligence – agentic AI. While “one-shot” AI refers to models that perform a task after a single prompt (like generating an image or completing a sentence), agentic AI is a different beast entirely. Agentic AI systems can make decisions and take actions autonomously, much like a human agent, to achieve specific goals. But that intelligence comes at a cost—agentic AI requires 100 to 1000 times more compute than traditional one-shot models.

Source: NVIDIA (May 2025)

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Disclaimer

This article is prepared by Firetrail Investments Pty Limited (‘Firetrail’) (ABN 98 622 377 913, AFSL 516821) as the investment manager of the Firetrail Australian High Conviction Fund (ARSN 624 136 045), the Firetrail Absolute Return Fund (ARSN 624 135 879), the Firetrail Australian Small Companies Fund (ARSN 638 792 113) and the Firetrail S3 Global Opportunities Fund (ARSN 653 717 625) (‘the Funds’). Pinnacle Fund Services Limited ('PFSL') (ABN 29 082 494 362, AFSL 238371) is the product issuer of the Fund. PFSL is not licensed to provide financial product advice. PFSL is a wholly-owned subsidiary of the Pinnacle Investment Management Group Limited (‘Pinnacle’) (ABN 22 100 325 184). The Product Disclosure Statement (‘PDS’) and Target Market Determination (‘TMD’) of the relevant Fund are available via the links below. Any potential investor should consider the PDS and TMD before deciding whether to acquire, or continue to hold units in, the Fund.

Links to the Product Disclosure Statement: WHT3810AU, WHT5134AU, WHT3093AU, WHT7794AU

Links to the Target Market Determination: WHT3810AU, WHT5134AU, WHT3093AU, WHT7794AU

For historic TMD’s please contact Pinnacle client service Phone 1300 010 311 or Email service@pinnacleinvestment.com

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