Global equity markets had their worst quarterly performance in 15 years with the US and European markets crashing 18% and the MSCI World Index loosing $2.7trillion of its value. The third quarter 2002 was characterised by a crisis of confidence in Corporate America, declining economic and profit growth prospects, poor investment sentiment and war talk.

In line with the mandate, the fund continued to be fully invested in Global Equity markets : 58% in the US, 28% in Europe and 12% in Asia Pacific. The fund did not escape the woes of the market and declined by 12.3% over the quarter. Some of the worst performing sectors included IT Consumer stocks (down 46%), specialist financials (down 28%) and Airlines (down 32%).

Although global equity markets are now trading 30% lower than the start of the year, market volatility is expected to remain as deflationary pressures, war talk and economic uncertainty continues. The fund is well positioned to offer the investor diversified exposure to all developed equity markets of the World and will be a major beneficiary when the global economic and market recovery happens.

As the fund remains to be fully invested in Global Equity markets, SA rand movement against global currencies, will continue to have an effect on rand performance numbers. Since the end of March 2002, the rand appreciated by more than 10% against the US Dollar, 4% against Sterling and but lost 1% against the Euro.

The fund is positioned to capture the performance of Global equity markets in total without taking specific views on certain sectors or regions. The fund managers expect this fund to perform very much in line with the MSCI World Equity Index and the focus remains on developed equity markets. Investors in this fund will benefit from growth in global equity markets and will be invested in a diversified portfolio of stocks in North America, Pan Europe, Japan and some other Pacific countries.

Investors in this fund will largely be exposed to the US$, Euro and Pound and the rand hedge qualities of this fund makes it very attractive. The rand component will vary between 5% and 10% of total fund assets.

The International Fund of Funds under-performed the peer group over the quarter. The rand strengthened by more than 5% against the US$ over the quarter. Because of the rand’s strength against major currencies, the fund delivered negative returns.

The fund is positioned to capture the growth of global equity markets in total without taking specific views on certain sectors or regions. The fund manager expects this fund to perform very much in line with the MSCI World Equity Index and the focus remains on developed equity markets.

Investors in this fund will benefit from growth in global equity markets and will be invested in a diversified portfolio of stocks in North America, Pan Europe, Japan and some other Pacific countries.

Investors in this fund will largely be exposed to the US$, Euro and Pound and the rand hedge qualities of this fund makes it very attractive. The rand component will vary between 5% and 10% of total fund assets.

The portfolio of the Sanlam International Fund of Funds has been radically changed in the fourth quarter of 2001, with holdings in all six regional and specific in sector funds replaced by four index tracker funds. Given the relatively poor performances of many foreign general equity funds, this strategy might appeal to investors who prefer a passive asset management style.