|
|
Sasfin International Flexible Fund - News
|
|
|
|
|
Sasfin International Flexible comment - Mar 10
|
|
Thursday, 27 May 2010
|
Fund Manager Comment
|
The quarter saw highly contrasting performances despite little change on the indices over the period. Equity markets hesitated between new positives (corporate earnings and signs of a recovery) and concerns at the consequences of growing public debt and the measures taken to prevent the crisis from worsening. What's more, Greece again raised doubt over the strength of the euro. In this climate, we maintained our equity investments over the quarter with net exposure in the order of 75%. Modified duration was also able to contribute to performance in the wake of the widespread fall in returns. In regional terms, we maintained our bias for European equities. The most targeted theme remains equities that provide high yield and strong visibility. Financial stocks have been under-weighted. The fund's NAV gained 2.04 % between December 31, 2009 and March 31, 2010.
|
| |
|
Sasfin International Flexible comment - Dec 09
|
|
Thursday, 27 May 2010
|
Fund Manager Comment
|
Week after week, the equity markets kept within a narrow trading range, torn between hopes of an economic recovery, the speed of the rebound and fears of a change in monetary policy.
Finally, at the very end of the period, the market has taken off, favouring the idea that the economic statistics and corporate results harbour good surprises. The only flat note is that interest rates began to rise again, particularly in the United States. The Dubai crisis and downgrade in Greece's rating have revived concerns in some parts about the quality of sovereign issues.
More interesting, the equity market rebound has not resulted in a weakening dollar, but has led instead to an increase in its value.
In this climate, we remained invested in the equity market and have taken full advantage of the uptrend. We have now begun to gradually reduce the equity market overweighting given the massive rebound that has been underway since last March. Most of the portfolio is invested in high visibility stocks that offer a relatively high return.
|
| |
|
Sasfin International Flexible comment - Sep 09
|
|
Tuesday, 15 December 2009
|
Fund Manager Comment
|
Despite a painful beginning, the third quarter ended wonderfully with equity markets yet again stepping up the pace of their rebound. Publication of better-than-expected corporate earnings - thanks to highly reactive cost cutting - set the tone from mid July. Then, ever more tangible data on the rebounding economy, removing all concern of a sudden switch in monetary policy, convinced even the most stubborn investors to return to the equities markets.
The recovery in risk appetite was reflected by an impressive drop in spreads on corporate bonds and a new round of dollar weakness. In this climate, we remained positive throughout the period over the medium term outlook for equities, anticipating signs of a recovery. After capturing the uptrend very ably through to the end of August, we gradually took some of the profits. The exposure rate remains relatively high, however, at around 85%. A fund playing on a rebound in Value equities, that we invested in last year, was sold in exchange for a new fund investing in the theme of Restructuring.
|
| |
|
Sasfin International Flexible comment - Jun 09
|
|
Wednesday, 23 September 2009
|
Fund Manager Comment
|
The second quarter of 2009 witnessed one of the strongest market rebounds in history. The reverse psychology behind this is linked both to the belief that systemic banking risk has been eliminated and to the belief that economic recovery is linked to the scale of implemented recovery plans. Along with the sharp rebound in securities, interest rate markets also suffered with the exception of corporate rates which benefited from the reduction in spreads. June went, very marginally, against the current of the initial movement of the markets. The quarter ends, however, with a slow down in the recovery, rising commodity prices, notably oil, and tensions in government bond markets following 3 months of unrestrained rebound. In this context, the portfolio benefited from its equity exposure while maintaining a defensive bias in the fund including under-exposure in financial stocks. The NAV of SASFIN has increased by 15.72% in the second quarter.
|
| |
|
Sasfin International Flexible comment - Mar 09
|
|
Thursday, 11 June 2009
|
Fund Manager Comment
|
The beginning of the year was marked by particularly high volatility in equities as well as on the fixed income and currency markets. Equity markets experienced virtually no respite until the beginning of March. Realisation of the extent of the crisis, which spread to all regions and sectors, took most markets down to levels last seen in 2003. News of an improvement in bank operating margins and the publication of more positive economic indicators in the United States (for real estate and consumer durables) produced a strong equity rebound starting on March 10. This was sustained by the news of further support measures from the Federal Reserve, especially the decision to buy up long Treasury bonds, as well as Timothy Geithner's contribution to the bank rescue plan. Overall, the quarter was negative for equities, however, with the MSCI World index dropping 7.8% in local currency. In this climate, we maintained our equity exposure so as to capture the market rebound. In the equity compartment, we have remained cautious and overweighted Value stocks mainly at the expense of financials. The sectors that we are overweighting are chiefly healthcare and telecoms.
Sasfin lost 8.71% over the quarter while its benchmark dropped 9.44%.
|
| |
|
Sasfin International Flexible comment - Dec 08
|
|
Wednesday, 4 March 2009
|
Fund Manager Comment
|
In this climate, we gradually reduced the equity market under-weighting towards a neutral position by the end of October. The overweighting in the healthcare, consumer basics and industrial sectors was maintained. We have, however, remained under-weighted in financials and discretionary consumer goods and services.
|
| |
|
Sasfin International Flexible comment - Sep 08
|
|
Friday, 14 November 2008
|
Fund Manager Comment
|
The quarter was full of contrasts. After a very difficult start, equity markets put in a fine rally, particularly in financials, from July 15 to the end of August. Alas, misgivings about the health of the financial system once again broke records in September. This was reflected in the collapse of Lehman Brothers and more generally the doubt cast on investment banks without a network. It also meant additional pressure on bank financing levels and running further risks in financing the economy in the months ahead. However, the public authorities have intervened massively, inflation has declined sharply and equity valuations have already priced in a flood of bad news. In this market climate, we kept the regional focus on Europe and a defensive orientation overweighting the energy, industrials and basic consumer goods sectors. Nevertheless, increasingly attractive valuation levels prompted us to gradually reduce the equity underweighting against the index.
|
| |
|
Sasfin International Flexible comment - Sep 07
|
|
Monday, 12 November 2007
|
Fund Manager Comment
|
After beginning the quarter with a rise, equity markets were heavily shaken from the end of July on. Investors feared that the US real estate crisis would have more impact on growth than initially anticipated. The correction was intensified because the liquidity crisis also impacted dynamic treasury funds.
The equity markets rebounded in mid-August and then in mid-September following the Federal Reserve's interest rate cuts, which helped to obscure underlying concerns about the economy in the months ahead. The race between a worsening economic situation and the speed of the remedy (interest rate cuts) will probably continue to animate the markets for some time.
Given this environment, we reduced the fund's equity weighting over the period. We are continuing to target European and Asian equities in preference to those in the United States, reflecting our confidence in the fact that the impact of the US slowdown on the rest of the world will be more restrained than in recent cycles.
Over the quarter, Sasfin International Fund posted a performance of 4.34% while the benchmark's was 4.49%.
|
| |
|
Sasfin International Flexible comment - Jun 07
|
|
Wednesday, 12 September 2007
|
Fund Manager Comment
|
Most equity markets gained during the quarter on a tide of sound corporate earnings and financial transactions. However, there were two corrections in June, both of brief duration. The first was the result of concerns that the US economy would rebound too rapidly and result in strong interest rate hikes; the second the outcome of fears of a financial crisis arising from the punctured US real estate bubble by means of CDO's and hedge funds.
We believe that the world economy will maintain its momentum despite the slowdown in US growth resulting from the correction in the real estate sector, and are therefore equity overweighted, particularly in Europe.
We strengthened the equities during June. Over the quarter, the fund gained 5.38% while its benchmark rose 4.61%.
|
| |
|
Sasfin International Flexible comment - Mar 07
|
|
Monday, 21 May 2007
|
Fund Manager Comment
|
Equity markets began the year with a modest gain. At the end of February, however, they suffered a sudden fall reflecting fears over the business cycle and the health of the financial system, following alerts concerning US loans. Since then, they have been climbing again, but remain very nervous.
The correction did not call our scenario into question. World growth is continuing, even if the real estate slowdown in the United States will still impact the US economy. Corporate earnings will continue to increase, particularly in Europe and Asia, but at a slower pace than in 2006. Finally, equities will remain within reasonable valuations. Given this environment, we have maintained our European equity overweighting. Over the quarter, Sasfin declined by 0.58%
|
| |
|
Sasfin International Flexible comment - Dec 06
|
|
Sunday, 21 January 2007
|
Fund Manager Comment
|
Sasfin's net asset value gained 6.7% during the last quarter of 2006, while its reference index rose 7.0%. During the quarter the widespread equity market rebound begun this summer continued. After the fears that dogged May and June, the markets concluded that the US economy would successfully make a soft landing, preserving corporate capacity to grow their earnings while keeping inflationary risks under control.
More stable oil prices in the fourth quarter also gave weight to the idea that US household spending would remain sustained despite the correction taking place in the residential real estate sector. In this climate, and concerned that the US slowdown could rattle the equity markets, we initially maintained the cautious stance we had adopted during the summer. We then took advantage of a brief setback in the European markets at the end of November to strengthen the equities.
|
| |
|
Sasfin International Flexible comment - Sep 06
|
|
Saturday, 21 October 2006
|
Fund Manager Comment
|
The markets are hesitating, for the last few weeks equity and fixed income markets have been gaining, but on small volumes. Some bolder trends are apparent in a number of sectors including a significant gain for technology stocks and heavy fall in oil stocks. The one thing that everyone agrees on is the fact that the US economy will grow at closer to 2.5% in 2007 rather than its current pace of 3.5% in 2006.
The principal reason for this slowdown will be the correction to real estate investment. Apart from that, opinion is divided: - Will the slowdown in the US be gentler or worse than expected? - Will its impact on the economy of other regions be as marked as in previous cycles even though the US's relative weight in world GDP has declined? - Will corporate earnings be as sensitive to this slowdown as in the past, while companies are in such exceptional health and reaping the full benefit of globalisation? - How much of the bad news flow have the markets already taken on board? It is very difficult to establish distinct views on these questions at present.
However, the supporting factors are considerable and we find them reassuring with respect to the medium term health of the equity markets at a moment when the cycle could weaken them: - Equity valuations are not very high when compared with bond valuations - even with no concern that long term rates will suddenly take off. - Long term rates have actually fallen heavily since they peaked, easing pressure on the equity markets in doing so. - Commodity prices - and those of oil in particular - have been falling steeply for the last month and so reducing inflationary risks and the pressure on corporate profit margins and household confidence.
That is why, despite our preference for equities over a 12- to 18-month horizon, we would rather adopt a more cautious stance over the short term for tactical reasons. As a result, we are currently equity-underweighted, particularly when it comes to US stocks. Sasfin recorded a performance of 0.9% for the quarter, against one of 3.7% on the part of its reference index.
|
| |
|
Sasfin International Flexible comment - Jun 06
|
|
Friday, 21 July 2006
|
Fund Manager Comment
|
Economic activity remained strong during the first semester. Along with this strength, the first signs of a return to inflation appeared, raising market concerns over central bank interest rate trends and signs of slower growth in the United States. After rising strongly for four months the equity markets fell more than 10% in three weeks. The outlook for world economic growth, however, has not been put seriously in doubt. Corporate earnings forecasts have been upgraded and their growth potential for 2007 remains real. Long term interest rates are unlikely to be a heavy burden on equity values, which remain highly attractive.
We therefore feel that the market is already anticipating a lot of bad news. That is why we strengthened our equity overweighting towards the end of the second quarter, after having reduced it at the end of April. In this environment, Sasfin posted a performance of 4.1% while its reference index gained 3.3% over the semester. Fund performance was -1% for the second quarter and the index's came to -0.3%.
|
| |
|
Sasfin International Flexible comment - Mar 06
|
|
Friday, 12 May 2006
|
Fund Manager Comment
|
The world economic activity remained very strong in the first quarter of 2006. However, the expected broadening of economic growth and reduction of deficits are slow to come. On the one hand, Japan and Europe to a lesser extent increasingly enjoy stronger economic growth. On the other hand, growth is not slowing down in the United States. Consumer spending remains steady and the current account deficit has been widening. Over the 1st quarter, we have seen continuous upward revision in GDP growth. However, the primarily investment-driven growth will have to create more jobs to be sustainable.
The first 3 months of 2006 have been good for our asset allocation, since equities, especially European, outperformed bonds. Best performances go to European equities (10.1 % for MCSI Europe in USD), mostly French (13.6 % for the CAC40 in USD) and particularly small and medium-sized firms, followed by emerging markets, Japan (4.8 % in USD) and the United States (3.7 % in USD).
The rise in European equities since the beginning of the year is nearing year-end consensus target and therefore a correction is possible. However, we believe several factors will push equity markets further.
- World activity seems to be better than expected.
- The expected earnings growths have been upgraded, mostly in Europe and, to a lesser extent, in the United States. This phenomenon seems to be decisive and could result in a PE increase. The M&A activity (which explains 2/3 of the CAC40 performance) is going on.
Today, companies are ready to spend their cash flow or to increase leverage, at historically low rates, to acquire rivals and thus improve profitability.
- The recent speech by Mr. Bernanke, Chairman of the Federal Reserve Bank, implies that long-term interest rates will not rise enough to disrupt equity markets.
Therefore, we are maintaining our main positions:
- In favour of equities up to 2/3 of our band of fluctuals
- In favour of European and Japanese equities, because of better earnings growth expectations and, at least in Europe, a more attractive valuation.
- In favour of portfolio diversification: small European capitalizations, energy, commodities and emerging markets.
- In favour of a bond allocation protecting us against a rise in interest rates. In this context, SASFIN rose 5.2% since the beginning of the year, versus 3.6% for the index.
|
| |
|
Sasfin International Balanced comment - Dec 05
|
|
Friday, 20 January 2006
|
Fund Manager Comment
|
Year 2005 ends on a revision of scénarii 's increases concerning economic growth on both sides of the Atlantic Ocean. In the second half of the year, the American growth has, once again, surprised by its resistance in the sharp increase in oil prices, in the shock of KATRINA. Europe slightly regained self-control late in the year, especially on industrial side and Japan redid surface, its return even seems to be one of the most solid of industrial nations (statement of account balancing, the recovery of the profitability of companies and debt pay down). In this very non-inflationist growth environment, the FED carried on its fed funds ' increase (+50 cents at 4, 25%) followed by the BCE which has increased of 25 cents its rates (2, 25%).
Long term rates greeted this trend by an increase on both side of Atlantic Ocean. However, they flowed back in December almost returning to their levels of the beginning of quarter. Henceforth the curve of the rates is reversed on its 0-5 years part in the United-States and still flat in the Euro zone.
Companies ' results also surprised by their sharp increase. In Europe, while a 10 %of profitable growth was anticipated at the beginning of 2005, we should end the year on more than 20 %of growth of results! It 's the same in the United States and in Japan. Markets knew an acceleration of their growth in the late year, closing with an increase of 25 %for World MSCI in Euro on December 30th, 2005. The award goes to the emergent markets and to Japan with respectively 50 %and 44 %of growth in Euro, closely followed by France and small and average capitalizations. Only United-Stated was disappointing, handicapped by the increases of the short rates and the big increase of the dollar.
The year ended in a good note of optimism. The world economy should remain very strong in 2006, though the increasing financial imbalance. The growth of the enterprises profits ' seems to be strong, on-line with the strength of the world economy. Thus, we remain very confident for the coming months and maintain our overweight on stocks especially for Japan and energy.
|
| |
|
Sasfin International Balanced comment - Sep 05
|
|
Thursday, 20 October 2005
|
Fund Manager Comment
|
During the third quarter, the strength of world growth and the fact that it remained unaffected by the hike in commodity prices were a pleasant surprise. Prior to the hurricanes, the US economy was booming and Japan had just begun to experience growth. Europe remained lackluster. In the aftermath of the hurricanes, oil prices reaching up to almost 70 dollars/barrel caused concern over inflation and an economic slowdown. The yield curve in the US has flattened out; with Fed funds and long term interest rates rising 75 and 40 cents respectively. In Europe, long term rates and ECB rates remained stable. Over the period, equity markets rose sharply, particularly in Japan (+17.2%) and Europe (+7.4%). This performance is owed to continued upward revisions of corporate earnings. Until now, concerns over high oil prices and a possible rise in interest rates have not had a negative impact on equities thanks to their attractive valuation relative to bonds.
In this context, SASFIN rose by 5.46% over the quarter, 2.13% year-to-date.
|
| |
|
Sasfin International Balanced comment - Jun 05
|
|
Monday, 25 July 2005
|
Fund Manager Comment
|
During the second quarter, fears surfaced of a sharper slowdown in the United States than anticipated following some turbulence in March. Nevertheless, good employment figures and consumer spending served to calm the concern. Across the Atlantic, Europe remained at a standstill and leading economic think tanks downgraded their growth forecasts for 2005.
The institutional crisis in Europe impacted the euro while the rate spread between Europe and the United States drifted further in the dollar's favour. In Japan, the environment has been improving though deflation remains. Certain indicators, including consumer spending, employment and investment, have sent the market positive signals, however.
Oil prices, after falling in May, hit $60 in June, having climbed 40% since the beginning of the year. Demand, still sustained, raised fears of supply shortages. In this context, the Federal Reserve continued to tighten monetary policy, taking the Fed Fund rate to 3.25%. This was the ninth consecutive rate hike since June 2004, and produced a more noticeable flattening of the yield curve. The European Central Bank maintained its interest rates despite widespread pressure from national governments arguing for a cut.
The credit market remained under pressure until mid May. Profit warnings from General Motors and Ford raised risk aversion and this produced a flight to quality. On the equity markets, the major development in the last few months was the positive earnings performance posted by European companies in the uncertain environment. This was acknowledged by the markets which have recorded contrasting performances in local currencies since the beginning of the year. European markets gained over 10% while those in the United States and Japan almost flat-lined. Given the upgrades to corporate earnings forecasts for 2005 and the fall in long-term interest rates, it seems that equity markets did not manage to solve the enigma Alan Greenspan raised regarding the relative valuation of different markets.
Since the beginning of the year, market PERs have not moved, and are still close to their 25 year low. The equity risk premium relative to bonds is close to an all time high and the yield on equities is higher than on bonds. At their current level, however, stock prices seem to have anticipated much of the bad news and we continue to believe that valuations will go back to normal.
Sasfin posted a performance of -0.45% for the quarter while its reference index lost -0.56%. The equity weighting was increased in favour of the oil sectors and luxury goods, during the quarter, as was the US compartment, in order to benefit from the rise of the dollar.
|
| |
|
Sasfin International Balanced comment - Mar 05
|
|
Thursday, 21 April 2005
|
Fund Manager Comment
|
The first quarter has confirmed US growth. The business cycle seems to be under way in the United States with recovering job creation and continuing investment. In contrast, the economic environment was disappointing in Europe and t a lesser extent in Japan, where it continues to be lack-lustre. While economic growth was living up to expectations, fears have surfaced that inflation could return, partly as a result of the oil price hikes and particularly after publication of the latest growth in US production prices. With Alan Greenspan's positive words about the business cycle, US long term interest rates increased rapidly, ending the quarter with the 10-year nope up 25 cents. At the same time, European interest rates barely moved the rate spread between both sides of the Atlantic widened. In this climate, the Fed continued to raise its interest rates gradually by 25 cents in February and in March - climbing from 2.25% to 2.75% by the end of the quarter - while the European Central Bank's was unchanged.
On the bond market, investors continued to show an appetite for risk until mid March. Emerging market and high yield bonds therefore gave the best performances. Meanwhile, the equity markets was buoyed up by takeover expectations in all sectors. In the wake of transactions such as Procter & Gamble's acquisition of Gillette, the markets have been focusing on up-and-coming deals. Consumer cyclical sectors, energy and commodities also enjoyed better performances while technology, telecoms and financials (excluding insurance) were corrected.
In March, General Motors' profit warning troubled fixed income markets which therefore sought quality at the expense of emerging market and high yield bonds. Equity markets also experienced a correction, particularly in Greece and Austria.
Since the beginning of the year, equities have climbed 3.12% on the MSCI AC World Free index, in euros. The best performance again came from small and mid caps, emerging markets and from France - where Total's weight in the index was boosted by hikes in Brent crude prices since the beginning of the year - all recording performance above 6%. Meanwhile the United States did not manage to post a positive performance in dollar terms, but the rise in the dollar's value offset the loss.
The equity compartment was re-weighted during the quarter. The portion invested in Japan was reduced in favour of the United States in order to benefit from the dollar's rise. Cyclical stocks were reduced in preference for oil stocks and consumer non-cyclicals.
We remain confident in the progress of the business cycle and in equity valuations catching up over time. As a result, we are maintaining our equity overweighing.
|
| |
|
Sasfin International Balanced comment - Dec 04
|
|
Thursday, 27 January 2005
|
Fund Manager Comment
|
Sasfin posted a performance of 4.90% for the period running from the beginning of the year to December 31, 2004, against a gain of 9.90% on the part of its reference index. The performance gap is the result of the equities portfolio being overweighted in cyclical and communication stocks and underweighted in Europe.
During the last quarter, equity markets continued the uptrend begun in mid-August, with the MSCI AC World Free gaining 11.90%, the DJ Eurostoxx rising 8.33%, the S&P 500 up 8.88% and the Topix climbing 11.28% in US dollars. The global recovery in growth in 2004 confounded financial forecasts. The year's equity markets grew less than expected despite strong upgrades to earnings forecasts throughout the second half of the year. The recovery of both the market and the economy was hampered by oil price hikes and the decline in the dollar, which caused setbacks in the United States and then in Europe.
Among the stocks that made a positive contribution to the quarter's performance were Thales (+30%), Advance Auto Parts (+23%), Liberty Media (+20%), Abbott Laboratory (+16%) and Metro AG (+14%). Negative contributions came from Freeport-McMoRan (-14%), Newmont Mining (-9%), Picc Property (-8%), FirstEnergy (-7%), ChevronTexaco (-6%) and Microsoft Corp (-4%).
Since September, the US Federal Reserve has raised its key rates twice by 0.25% while the European Central Bank (ECB) has held its at 2%. Long term interest rates in the United States started to rise, by 0.1%, over the quarter, while the increase in the value of the euro helped European long term rates to continue falling and to end the year at 3.68%.
While oil prices and the value of the US dollar were the principal causes of concern in 2004, this is unlikely to be the case in 2005, especially since companies have proved themselves able to handle such risks without putting their profitability into question. Lack-lustre growth in Europe is likely to persuade the ECB to hold interest rates steady for a number of quarters while the Fed will continue to raise rates gradually.
|
| |
|
Sasfin International Balanced comment - Sep 04
|
|
Wednesday, 10 November 2004
|
Fund Manager Comment
|
The MSCI World Free index feel 0.8% in US dollars from July 1 to September 30, 2004. While fluctuating within a single trading range since the beginning of the year, the markets hit a low in mid August. Poor economic statistics, especially very disappointing employment figures in the United States, together with soaring oil prices raised fears that growth could come grinding to a halt by the end of 2004. Comforting words from Alan Greenspan, together with new figures calming the mid August fears that helped the markets to rebound. The rally has, however, been achieved on very thin trading volumes, with no fresh news, and too little volatility.
All told, the only markets to post a positive per4formance were those of Asia excluding Japan. Japan itself gave the worst performance, with the Topix losing 8.7% in US dollars. Looking at the sectors, technology stocks were worst hit, with the Nasdaq losing 5.9%, while energy posted the best performance. Generally, yield stocks performed better than growth stocks.
Sasfin lost 0.37% in US dollars over the quarter. This more modest decline (compared with the index) was the result of the fund being equity underweighted. What's more, it is heavily invested in yield stocks - a the expense of technology stocks. Holdings in the latter were reduced after a wave of unfavourable announcement by companies in the sector.
The markets are still very edgy and oil prices remain extremely high, which requires caution over the short-term. Over the medium term, we remain confident about the business cycle and do not expect equities to fall heavily as valuations are still moderate. If oil prices fall, equity markets will probably break through current thresholds.
|
| |
|
Sasfin International Balanced comment - Jun 04
|
|
Tuesday, 20 July 2004
|
Fund Manager Comment
|
As of July 01 2004 total assets of the Sasfin International Fund were US$8,390,021.40. Performance of the fund over the quarter was down 2.1%. Over the same period the composite index was down 2.5% (-3.4% for JPM Global Bond and -1.6% for the MSCI AC World Free).
Economic developments confirmed the global and synchronized growth improvement over the last quarter, most no0ticeably in the USA and Japan. Meanwhile, financial markets behaved poorly in a trading range, most investors being worried by the prospects of a less accommodative FED stance, by rising oil prices and by the publicly announced goal of the Chinese government to restrain an overheating fixed investment cycle. Global emerging markets were most penalized by a less abundant liquidity environment, even though, from both a secular point of view and from a bottom up approach, these markets remain a very compelling story.
Looking forward, even if global economic growth appears to be peaking, it will eventually stay strong for longer than previously anticipated. On the other side, we still believe that the recent pick up in inflation was predominantly affected by transitory factors, and that further deterioration will remain well contained.
Global equity markets behavior will rely again on the prospects of interest normalization, oil prices, and the general prospects of earnings growth, which will be announced along with the second quarter results. Valuations are not excessive but earnings expectations have risen over the past months and valuation measures are not abnormally low enough to trigger a significant upside move for major indices.
At 30th of June, the modified duration of the bond portfolios was 4.1.
75% of the bonds are government bonds, 9% are financial bonds and 16% are corporate bonds.
The breakdown by ratings is 50% of AAA, 22% of AA, 22% of A and 6% of BBB; the average rating of the portfolios is AA-.
The main corporate issuers in the portfolio are BMW, DEXIA, Technip-Coflexip, NTT, Deutsche Bahn, Société générale, HBOS, Suez and Allianz, each of them represent between 2% and 3%.
|
| |
|
|
