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Equity unit trusts in South Africa |
10 Aug 2011. Over the last 10 days I've had a front row seat to the greatest show on earth, watching stock market reactions to Washington theatrics. The US government is finally joining the global deleveraging party, and the dominoes are falling. Pointedly, the S&P has cut the USA's credit rating from AAA to AA+, saying that Washington's rescue package isn't enough (consider that the US has had a AAA rating since 1941). Clearly the US is going to have to cut taxes and raise expenditure by even more, sucking even more money from the world economy.
Most markets have fallen dramatically, but South Africans have been shielded from the worst by Rand weakening. When there's big movements going on I keep a close eye on relative values, to see whether there are any opportunities arising. Here's how the Allan Gray Funds have seen their value changing from the 1st July 2011 to the 5th August 2011 (almost all of the changes occurred in the last week):
Equity |
Balanced |
Stable |
Optimal |
Bond |
Orbis Equity |
Orbis FoF |
Orbis Optimal |
-5% |
-2% |
2% |
1% |
3% |
-7% |
-1% |
1% |
Note that I've rounded off without showing any decimal places, as I'm not going to switch between funds based on decimal point differences, so avoid the information overload. Global equities are looking a tiny bit more attractive (but there are some problems in gaining exposure there due to a bout of paternalism from our couldn't-care-less regulators - I'm still waiting for a response from them in case you were wondering).
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