The Imalivest Flexible Fund will change it's name to Imalivest MET Flexible Fund, effective from 10 December 2012.

Adhering to our investment philosophy, we divide our holdings into 4 categories.

Our Core Holdings are holdings in shares which we believe have strong and defendable franchises and understandable business models. These shares must also exhibit above average return on equity ratios and sustainable earnings power. Investments in this category make up 33.5% of our Fund and include British American Tobacco, Famous Brands, Hudaco, Richemont and SAB Miller.

The 'Margin for Error' category comprises shares that trade at a reasonable discount to their intrinsic values. Currently 25.6% of the portfolio is invested in this category.

Regulated entities would normally enjoy great security in their business models. However, pricing and other critical variables are changed by regulators who are often working on political agendas. Their, sometimes politically driven decisions, can harm the profitability of these companies. We therefore make sure that we only invest in these companies when they allow for a significant margin for error. Currently 8.2% of the fund is classified as Regulated Holdings.

The special opportunities category consists out of shares whose valuation we cannot justify using historical performances, but we have a strong conviction of their future earnings potential. 10.4% of the Fund's assets are currently invested in this category.

The Fund also has international exposure via its 21.4% investment in the Imalivest Worldwide Flexible Fund. The Worldwide Fund follows the same investment philosophy as the domestic Fund and hence we invest in it to get exposure to our international identified core holdings.

In addition, the investment in the Worldwide Fund gives the Fund a 0.7% exposure to foreign cash. In total the Fund currently has 1.6% in cash.

Adhering to our investment philosophy, we divide our holdings into 4 categories.

Our Core Holdings are holdings in shares, which we believe, have strong and defendable franchises and understandable business models. These shares must also exhibit above average return on equity ratios and sustainable earnings power. Investments in this category make up 34.0% of our Fund and include British American Tobacco, Famous Brands, Hudaco, Reinet, Richemont and SABMiller.

The 'Margin for Error' category comprises shares that trade at a reasonable discount to their intrinsic values. Currently 19.9% of the portfolio is invested in this category.

Regulated entities would normally enjoy great security in their business models. However, pricing and other critical variables are changed by regulators who are often working on political agendas. Their, sometimes politically driven decisions, can harm the profitability of these companies. We therefore make sure that we only invest in these companies when they allow for a significant margin for error. Currently 7.8% of the fund is classified as Regulated Holdings.

The special opportunities category consists out of shares whose valuation we cannot justify using historical performances, but we have a strong conviction of their future earnings potential. 10.0% of the Fund's assets are currently invested in this category.

The Fund also has international exposure via its 22.1% investment in the Imalivest World wide Flexible Fund. The World wide Fund follows the same investment philosophy as the domestic Fund and hence we invest in it to get exposure to our international identified core holdings.

In addition, the investment in the World wide Fund gives the Fund a 1.2% exposure to foreign cash. In total the Fund currently has 7.4% in cash.

Another excellent month of -0.97% from the fund vs. -4.3% from its benchmark. The fund's defensive qualities proved resilient in what can only be described as an extremely challenging period.

Ben Benanke initially delivered "the goods" with Operation Twist, but unfortunately included the words "significant down side risks" in his FOMC speech. Markets decided to focus on the negative and with disappointing data from the US and Europe, they sold off. Investors clearly started factoring in a possible recession in the US and Europe. This time, EM market currencies felt the brunt and sold off sharply as investors took cover in the US dollar.

We believe that the US will avoid an outright recession while Europe's fate will be highly dependant on their politicians.

Within the portfolio we added Anglo American, Firstrand and Capital Shopping Centres at attractive levels. AVI was introduced as a new holding while reducing our weighting in EOH.
A cautious stance remains a priority given the fragile conditions in the global economy, while our focus remains on inflation beating returns over the longer term.