The flexible nature of the fund has provided substantial advantages for investors in these volatile markets.

The fund managers are particularly excited about the markets at the moment, as we are about to enter a period of great uncertainty, which will provide the fund managers with excellent buying opportunities.

The funds local portfolio has performed well, and the fund managers have in fact started to sell some of the funds winning stocks. The reason for this approach is not that the stocks are expensive, but that there are many investment opportunities from which to choose. For example, a one-year NCD will currently provide 13.75%, and some of the heavyweight stocks that the fund managers have ignored now look attractive.

The fund manager's tactical asset management for the quarter was superb. Going into the quarter the fund was overweight financials, and at the peak of the run the fund manager's exited. Interestingly, financial stocks went to below levels at which the fund manager's introduced them to the fund. As a result, the fund manager's selectively bought back. This is an example of how the irrationality of the markets is providing us with great buying opportunities.
Over the quarter, the fund manager's two disappointments were Discovery and Bidvest. With regard to Discovery, the fund manager's ignored one of their golden rules ie tackling Government. This leaves the fund manager's with an interesting dilemma in terms of Amplats as they take on Government regarding the mineral bill. In the case of Bidvest, it was just bad luck that they missed out on the Brake Brothers acquisition. Nevertheless, the fund manager's success in other stocks, such as Wesco, HLH, Avis, Foschini, and the fund manager's favourite, OZZ, added significantly to performance.
Looking forward, overseas markets appear difficult, with local markets looking far more attractive, and in particular Media and Telecommunications. Investors can expect the fund manager's to invest quite heavily into these sectors, as well as into some technology stocks.

Since inception (March 1999), the fund has delivered a return of approximately 90%. The key advantage of this fund is its flexible mandate, allowing for free movement between asset classes. In addition, investors in the fund understand the need for patience in achieving their long-term investment goals.
In the short term, the fund manager expect the Rand to strengthen, and for performance to come from the domestic market. Currently, the fund has 40% exposure offshore and little exposure to domestic commodity stocks.
Looking ahead, the fund manager believes that 2002 will continue to be a difficult year for investments. The fund manager will maintain the current portfolio until he is convinced in the sustainability of the global recovery. In the interim, the fund manager will evaluate all opportunities in search of those shares that will deliver excellent long-term performance.

Walter Aylett, fund manager, says the effective use of Coronation Optimum Growth's flexible mandate enabled it to be only 50% to 60% invested over this period. Coronation Optimum Growth has achieved a 74% unit price appreciation since its launch in Mar 1999.