Allan Gray Balanced Fund has been placed 33rd in its sector for the three month period ending Sep 01. Although this is unusual for Allan Gray, Simon Marais is neither surprised nor worried about the recent development. He believes that by sticking with the strategy of protecting capital the fund will produce solid and consistent long-term returns. The fund has moved into smaller-cap stocks which is in keeping with the group's investment philosophy of seeking shares trading at below intrinsic values.

The Allan Gray Balanced Fund turned 2 years old on the 1 October 2001. The fund was placed first in its category with a performance of 30.3% per annum over the past two year.

Allan Gray Balanced fund has performed well in an atmosphere of uncertainty and disillusionment. One reason is management’s ability which has been challenged by market volatility which looks to continue.

The fund manager, Simon Marais, is effectively balancing returns with the caution current market conditions demand. By reducing equity exposure from 72% in the third quarter of 2000 to 53% by December and 25% by March 2001, Marais has successfully locked in these equity returns. Money-market and long-term fixed-interest assets have been used to offset the lower equity content.

Market conditions remain fragile and this calls for depth of investment experience and skills, Allan Gray has that. It's of particular importance to those investing with long-term retirement funding as an objective.

(Source: Financial Mail, May 11, 2001)