Glacier Int Multi-Currency Comment- Mar 09 - Fund Manager Comment20 May 2009
Performance review
The fund returned 9.8% for the year, slightly behind the benchmark return of 11.06%. The portfolio currently invests in all maturities over the very short end of the yield curve on all deposits. The portfolio provides investors with an ideal hedge against rand depreciation and access to a well diversified portfolio of developed market currencies.
Market review
The Rand appreciated against all the major currencies during the month. US dollar 3 month deposit rates traded in a range between 0.80% and 1.35% during the month. The FOMC decided to leave interest rates unchanged on the 18th of March at 0.25%. Expectations are that the FOMC will keep interest rates unchanged at the next meeting taking place on the 29th of April 09. The money market fund invested in money market fixed deposits in the very short end of the money market curve.
EUR 3 month deposit rates traded in a range between 1.45% and 1.69% during the month. The ECB decided to cut interest rates with 50 basis points to 1.50% while the next ECB meeting will take place on the 2nd of April. Expectations are that the ECB will cut interest rates with another 25 basis points.
The GBP 3 month deposit traded in a narrow range between 1.52% and 1.90% The BOE decided to cut interest rates with 50bp on the 5th of March to 0.50%, while the next meeting will take place on the 9th of April 09. We expect that the BOE will keep interest rates unchanged at 0.50%.
Glacier Int Multi-Currency comment- Dec 08 - Fund Manager Comment18 Mar 2009
Performance review
The fund returned 35.3% for the year outperforming the benchmark return of 33.9%. The portfolio currently invests in all maturities over the very short end of the yield curve on all deposits. The portfolio provides investors with an ideal hedge against rand depreciation and access to a well diversified portfolio of developed market currencies.
Market review
US dollar 3 month deposit rates came down from 2.25% in the beginning of the month to as low as 1.44% at the end of December. Rates came down on the back of slower growth concerns. The FOMC decided to cut interest rates on the 16th of December from 1% to 0.25%. Expectations are that the FOMC will keep interest rates unchanged at the next meeting taking place on the 28th of January 09. Maturities could only be reinvested in the very short end of the yield curve.
EUR 3 month deposit rates came down from 4.73% to 3.78% on the back the global risk of a slowdown in growth. The ECB decided to cut the lending rate with 50bp on the 6th of November from 3.75% to 3.25%. The next meeting will take place on the 4th of December. Market expectations are that the ECB will cut interest rates with another 50 basis points. Currently we invest in all maturities in the 3 month area of the yield curve.
The GBP 3 month deposit came down from 3.91% to 2.68% on the back of worldwide growth concerns. The BOE decided to cut interest rates with 100bp from 3% to 2% on the 4th of December. The next meeting will take place on the 8th of January 09. We expect that the BOE will cut interest rates with another 50 basis points from 2.00% to 1.50%.