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    Recap at the start of 2011

    Compliments of the season at the start of 2011. From all of us at Seed Investments, we trust that you have a prosperous year ahead in every respect. Please don’t hesitate to contact us at any stage to discuss your investment portfolio and investment planning.

    As a recap, let’s look at what happened last year across some markets
    The map below gives a colour coded indication of good indication of market performance over the last year. This colour coded map reflects gains in green and losses in red across the global stock markets in 2010.

    Source : Emerginvest

    Generally 2010 proved to be a solid year for most stock markets across the globe.

    Stock market gainers over 2010
    • Russia gained 22,5%
    • Germany up 16,1%
    • UK’s FTSE100 up 9%
    • SA’s FTSE/JSE gained 19%

    While China continues to grow into a superpower economy, with tentacles across the world, the market lost 14,3% in 2010.

    The little red dot in the middle is Greece. The Athex composite is down 38% over the last year.

    With the strong rand, in dollar terms the local JSE gained 32,4%, outperforming the MSCI World equity in dollar terms of 12,3%

    Within the local market there was however a big disparity in returns from the 3 main sectors. The best performer was the Industrial 25 index, which gained 26,5%. Then came the Financial 15 index up 14,7%, then came the Resources 20 up 12,3%

    Looking broader than just global markets, the big gainers in 2010 were a range of commodities. The chart below reflects performance over 3 months of various markets and asset classes.

    Source: finviz.com

    The big gains however were across commodities. With strong performances from cotton, palladium, coffee, corn, oats etc. The chart above is a 3 month chart across various commodities and markets. Commodities have continued to move up strongly over the last few months.

    Gold has been a very good performer in dollar terms over the last 10 years.

    US Treasury bonds have come under pressure over the last 3 months as long term interest rates moved up from very low levels.

    While commodity prices are firmer, it was then disappointing that local resources were the worst performer of the 3 main indices. Much of this has to do however with the strong rand, which moved up to a 3 year high in December against the US dollar.

    While there remains a lot of enthusiasm for the growth potential of emerging markets, it is not a given that these markets will outperform the developed markets in 2011.

    Kind regards

    Ian de Lange
    Seed Investment Consultants
    021 9144 966

    Permalink2011-01-11, 17:14:49, by ian Email , Leave a comment
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