The IS Global Balanced Feeder Fund outperformed its peer benchmark, returning minus 3.40% vs minus 5.01% for the year.

The following commentary relates to the direct offshore fund and does not take into account the conversion to rands.

Contrarius continued its extraordinary bounce in returns, outperforming by over 15% for the quarter. During this period, the fund slightly increased its net equity exposure to 39%, which is still well below the average of the fund's history and reflects the cautiousness of the manager. Most of the strong performance came from its large overweight to Materials, specifically precious metals. A few familiar South African names are now creeping into the top 10, with counters such as Anglo American Platinum and Impala Platinum, as the manager is finding strong upside potential, especially in US dollars. Coronation also experienced a strong quarter, clawing back some of the underperformance of recent times. The performance came mainly from the stocks that have hurt in the past, such as the Brazilian holdings (increased probability that the president will be impeached), Urban Outfitters (improved operational performance), Harley Davidson, Discovery Communications and a few of the alternative asset managers. The high allocation to Property stocks also benefited as these performed very well over the quarter. IVA ended the quarter ahead of the benchmark, but almost flat in absolute terms. Its good stock picking and Gold ETF returns were largely offset by the fixed-income and currency losses. In almost all regions, equities finished ahead of their respective indices, with strong-quality companies such as Berkshire Hathaway, Oracle, Samsung and Hyundai yielding superior returns. Gold was up 15.9%, contributing 0.8% to the portfolio. The exposure to Gold increased from 4.6% to 5.8% through appreciation and additional investment. The exposure to fixed income decreased from 7.9% to 3.7%, mainly by reducing short-dated bonds denominated in Singapore dollars, as Singapore is in what it believes may be a "bad neighbourhood". The Nedgroup Fund struggled the most during the quarter, finishing over one percent in the red. Citigroup and Bank of America were among the biggest culprits for the fund, but this was used as an opportunity to increase the holdings of these stocks as the investment thesis has not changed. The equity exposure remains comparatively high, with the corporate bond allocation increasing to 4.9%. The Foord International Trust performed much in line with the benchmark and was largely unchanged during the quarter. Equities were slightly increased during the period but the fund remains cautiously positioned. The shares in the portfolio are concentrated in companies that generate higher returns than their global peers while operating with less leverage. The high cash weighting was maintained and seen as an option for any opportunity volatility will bring. It is predominantly invested in US dollars - first-mover advantage in interest-rate increases and faster growth will likely result in higher yields and currency appreciation against its peers. The Gold position is retained as this is typically an uncorrelated asset class offering diversification in times of volatility and geopolitical risk.