Valugro General Equity comment - Jun 10 - Fund Manager Comment03 Sep 2010
In previous commentaries we have mentioned that we favour the diversified miners within the resource sector. Exxaro and African Rainbow Minerals were both included during the 2nd quarter after coming up as buys on our Forward Valuation models. Whilst the diversified miners did not have the best of performances during the last quarter, they remain one of our favoured sectors as we believe that they are well geared to the global recovery and are currently pricing in commodity prices 40-60% below spot prices. An extremely attractive discount.
During the quarter we also reduced this fund's exposure to consumer service stocks. The sector has had a phenomenal 6 month performance and whilst we do not dislike the sector, our valuations were beginning to look stretched and the decision was made to take profits on selected shares. We did however replace Foshini and Truworths shares for Clicks, a decision that worked out well for us in recent months.
Please refer to our 3rd quarter houseview for Valugro's views on the global economy and our thoughts on the state of the SA consumer. This fund will be managed in line with this view during the 3rd quarter of 2010.
Valugro General Equity comment - Mar 10 - Fund Manager Comment22 Jun 2010
The month of March saw the JSE ALSI returning 7.9% largely driven by the resource sector and financials. The general mining sector delivered 12.4% with Anglo's one of the top performing stocks for the month (up 15%). Despite the strong run in March Anglo's remains the fund's biggest holding and we continue to see plenty of upside as earnings upgrades continue to come through. Many analysts have yet to factor in the recently settled coking coal and iron ore quarterly contracts.
Retailers had another strong month finishing March up 10% (retailers have now returned 17% for the year to date). Truworths has been one of the funds top 10 holdings for the past 6 months and we have discussed our outlook for the stock (and indeed the sector) in past fund commentaries. Truworths has now returned 22% year-to-date and while the dividend yield remains attractive, during the month we cut down on our holding on the current strength as the retail sector rerated on what seemed to be predominantly foreign buying. The fund has maintained its holdings in Foschini, Shoprite and Spar but will selectively take profits on continued strength.
Valugro General Equity comment - Dec 09 - Fund Manager Comment15 Feb 2010
2009 was both a "challenging" and "interesting" year for global equity investors, both locally and abroad. Whilst equity indices have recovered nicely since their lows on the 9th March 2009 (with almost all global equity indices closing positively for the full 2009 year), it has most certainly not been an easy period for decision-makers as much of the recovery has been "artificially led" vs "normal" or "fundamentals" economic growth. Never before has the world economy experienced government bail-out packages of this magnitude.
As 2009 ends, a few points are worth noting:
- The best performing equity market index for 2009 was that of Brazil.
- Their IBov Index returned 83% (excluding dividends).
- Other strong performing equity indices were India's Sensex Index returning 81% and China's Shanghai Index returning 80%.
- The gold price on the 1st of January 2009 was $856/oz. By the 31st of Dec 2009, gold traded at $1084/oz - an appreciation of 27%. Platinum appreciated by 59% (in US Dollars), whilst the price of brent crude oil appreciated by 105% to close at $77.20 per barrel.
- The JSE All Share Index rose 29%, and this was after being down 14% after the first 2 months of the year.
- The best performing sector on the JSE was healthcare sector which returned 76% for the year. Aspen (+119%) being the main contributors the healthcare sector's performance.
- The rand appreciated against all major developed country currencies including the US dollar (+27%), Euro (+24%), Pound Sterling (+15%) and the Japanese Yen (+31%). The rand however did depreciate against a few currencies, such as the Brazilian Real (-4.81%) and Australian Dollar (-0.36%).
- For 2009 the Fund returned 19%.