STANLIB Press Releases

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STANLIB Press Releases Week ending 2 July 2004
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Recent Press Coverage (rolling) Sunday Times
Business Times Money Retail Bonds a new way to
23 May 2004 make money Sunday Times
Business Times Money Go on, be a bull - it
works 23 May 2004 Business Day Company
News Pangbourne helps beef up
25 May 2004 iFour
portfolio Business Day Company News ApexHi
buys up Corbett to 26 May 2004 increase
retail share Business Report National Heres
a one-stop shop for 31 May 2004 the
fixed-interest investor Sake Rapport Eeindoms
trusts roep halt 23 May 2004 Sake
Volksblad SA beleggers moenie van
27 May 2004 buiteland af weghardloop Leader
ship Spotlight
01 May 2004
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STANLIB Press Releases Week ending 2 July 2004
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STANLIB Press Releases July 2004
Business Report
Sake Rapport
Sake Volksblad
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Leadership
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STANLIB Press Releases July 2004
23 May 2004
30 May 2004
Sunday Times Business Times Money
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STANLIB Press Releases July 2004
25 May 2004
26 May 2004
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Business Day Company News
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STANLIB Press Releases July 2004
31 May 2004
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Business Report National
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STANLIB Press Releases July 2004
23 May 2004
Sake Rapport
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STANLIB Press Releases July 2004
30 May 2004
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Sake Volksblad
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STANLIB Press Releases July 2004
01 May 2004
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Leadership
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Sunday Times Business Times Money
23 May 2004
Retail bonds a new way to make money   RETAIL
bonds a first for South Africa which you can
buy from tomorrow offer consumers an
alternative medium- to long-term interest-earning
option. Ordinary bonds which the government
issues to pay for it budget deficit are traded
on a daily basis on the bond exchange.  The price
of these bonds change daily, just as share prices
change, so there is always a risk that you might
have to sell an ordinary bond for a lower price
than you paid for it.  On the upside, it could be
sold for more than the original purchase price. A
retail bond is protected from price fluctuations
as it is not traded on the bond market, so your
initial capital outlay is guaranteed. However, if
you decide to cash in the new retail bond before
its maturity date, you will forfeit a percentage
of the interest.  All the interest will be lost
if you cash it in within its first year, and even
this is only allowed under extraordinary
circumstances. One of the National Treasurys
aims is to encourage South Africans to save.  It
hopes the bonds will attract new savers. Retails
bonds differ from ordinary bonds in that you do
not need large amounts to be able to invest
just R1 000 will do. The interest rates differ
depending on the duration of the bond you choose
two, three or five years.  The rates currently
range between 9.25 for a two-year bond and 10
for a five-year bond. The bonds interest rates
are set with reference to market interest rates,
particularly the rate at which the South African
government borrows. Interest is paid out twice a
year. When your retail bond matures, you can
either reinvest for another term or have the
proceeds paid out You cannot borrow against
retail bonds and you cannot sell or transfer them
to another person. Retail bonds can be purchased
from the National Treasurys offices in Pretoria,
any branch of the Post Office, or at
www.rsaretailbonds.gov.za. As with other savings
instruments, retail bonds have their advantages
and disadvantages. After you buy a retail bond,
it pays a fixed interest rate for the duration of
the bond, regardless of what happens to the
interest rate set by the Reserve Bank. The
interest rate on a money market account, in
contrast, changes daily.  So if rates rise, money
markets earn more interest and vice versa if the
interest rate falls. However, money market
accounts tend to require a far higher minimum
investment than R1 000, or alternatively, only
pay interest starting at a minimum amount. Unlike
ordinary bonds or the unit trusts that invest in
them, retail bonds have no fees or commissions.
Kevin Lings, Stanlib Asset Managements
economist, says your investment in a money market
or unit trust is monitored by a manager, who
ensures that you get the best return possible.
This would be difficult to do on your own.  The
downside is that there is a management fee that
you have to pay. He adds, however, that if you
pick the right institution, it will be well
managed. Lings says some people are hesitant to
approach institutions, and would prefer the
retail bond.  It provides the market with
another instrument and it may encourage more
saving, he says.
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Sunday Times Business Times Money
23 May 2004
Go on, be a bull it works Share market pays
dividends to those with cast-iron stomachs,
writes CHRIS NEEDHAM   SOMETIMES it pays to be a
diehard equity bull.  Those investors with strong
stomachs who kept investing in shares while
markets around the world took a lengthy tumble
from early 2000 to their lows in April last year
have had their faith rewarded. Yet with stock
indices such as the JSE Securities Exchange SAs
All Share index having rebounded by about 33
from the bottom set a little more than a year
ago, following overseas markets, the question is,
where to next for equities? Colin Woodin, chief
executive of the Association of Collective
Investments (ACI), says there is no question that
local investors have missed the boat in terms of
buying when shares were cheap.  They missed the
opportunity of diversifying their investments
into offshore markets by using their R750 000
allowance or by buying rand-based unit trusts.
Peter Lucas, global strategist for Ashburton
Investment Managers, takes a regional view.  He
sees Asia as offering the best opportunity,
whatever the investment time frame. Lucas says
although spotting value is crucial when buying
equities because cheaper assets provide a
better long-term return than overpriced ones
market timing is still a factor. He sees equities
in developed markets as having moved in a
range-trading pattern for several years.  Lucas
believes stocks are moving towards the top of
that range and in the longer term he sees a move
lower starting towards the end of this year and
lasting 12 months. In the shorter term, Lucas
predicts Western equities are going to rally in
the northern hemisphere summer.  However, he
has a warning for investors There will be a
major need to get out of Western equity markets
in the fourth quarter of the year. Quaniet
Richards, head of global investment trends at BoE
Private Clients, sees value in Japan, which is
experiencing what appears to be a sustained
economic recovery after a prolonged recession in
the 1990s. He says Trade with China has been
the main driver of exports.  We are bullish on
Japanese equities as earnings continue to be
upwardly revised (on the back of a pickup in
Japanese domestic demand and a rise in exports).
Of Western shares he says On a fundamental
earning yield analysis, relative to global bonds,
equities still offer value.  Richards says BoE
Private Clients is still bullish on the global
economic recovery this year but aware of the
threat of heightened geopolitical risks. Patrick
Mamathuba, executive director of International
Investments at Stanlib Asset Management, says
Our view of global equities is that they are in
fair-value territory after their recent
pull-back. He says Stanlib does not foresee any
big negative economic influence.  By region,
Stanlib still sees value in local equities and
they have a neutral weighting to European
equities, as Asia has a better story to tell
than Europe at the moment.
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Sunday Times Business Times Money
25 May 2004
Reuters reports Hank Herrmann, chief investment
officer at Waddell Reed Financial Services,
noted that US stocks had been moving lower for a
couple of months, but the rally appeared ready to
resume.  But the rosy outlook does not address
what I consider the wild card, which is the
Middle East and terrorism. However, chartists
say European stocks may have peaked. Eric
Lanteigne of stockbroker Collins Stewart said
Weve got maybe one or two more good weeks
before shares start to drift lower over the
northern hemisphere summer.  Charts show
Britains FTSE 100 index is pointing to a move
down almost 10 below current levels. SA
investors seem not to have used the strong rand
to diversify offshore.  ACIs Woodin says
rand-denominated foreign funds attracted only
R134-million in the last quarter.  Domestic funds
were vastly more popular but only R4.8-billion
went into equity and asset allocation funds while
R6.6-billion entered fixed-interest fund.  The
general consensus is that equities are likely to
be the better place to be in the next few years
but are not likely to experience the same
significant growth that weve seen recently,
Woodin says.  In a nutshell, diversification is
the key.
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Business Day Company News
25 May 2004
Pangbourne helps beef up iFour portfolio   Propert
y sale increases retail exposure LISTED property
loan stock company Pangbourne Properties has sold
a portfolio of properties housed in a special
purpose vehicle called Sipan to fellow property
loan stock iFour Properties for R289m.
Pangbourne, which has a stake of about 48 in
iFour, manages iFours property portfolio.
Pangbourne CEO Athol Campbell said yesterday that
with a number of new property listings on the JSE
Securities Exchange SA in recent months, there
had been increasing competition to acquire
properties. Pangbourne bought the properties for
cash using its loan facilities. We brought the
buildings into Pangbourne effective from January
1 this year.  IFour could then at its leisure
raise the capital as it can go to institutions
and say the purchase of the portfolio is
definite.  Usually the sale is conditional, said
Campbell. In order to purchase the properties
iFour has issued listed units underwritten by
Pangbourne. IFour CEO Anthony Diepenbroek said
the property deal would boost its market
capitalisation to about R869m and increase its
property portfolio size to about R1,9bn.
Diepenbroek said the objective of the
acquisitions was to improve the quality of the
portfolio with better leases, tenants and a
greater exposure to retail.  Of the eight
properties purchased, 60 are retail, 20
high-tech industrial and warehousing, and 20
call centre-related office space. We again have
grown the portfolio without diluting the yields
to unitholders, he said. Diepenbroek said that
through the deal the company had also removed
speculation about iFours financials results for
the year ended June 30. In iFours announcement
on the Stock Exchange News Service yesterday, the
company said its distribution to unitholders for
the year would be 78c compared with 75c in the
previous year.  It also forecast distributions of
82c for the year ending June 30 next
year. Diepenbroek said that another reason for
the deal with Pangbourne was that it eliminated
the risk of diluting iFours distributions. 
Dilution could emerge as a result of slow
transfers caused by delays in obtaining rates
clearance certificates from city councils. With
Pangbourne paying cash there was no impact on
having staggered transfers, Diepenbroek said. He
said iFour would take possession of the
properties on June 28 subject to unitholder
approval and approval from the Competition
Commission. Mariette Warner, who is the fund
manager of the Stanlib Property Income Fund, said
that the deal was a very good way for iFour to
have cash available to assemble a portfolio.
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Business Day Company News
26 May 2004
ApexHi buys up Corbett to increase retail
share   PROPERTY loan stock company ApexHi
Properties, one of the 11 listed property funds
with a market capitalisation over R1bn, has
increased its exposure to retail properties with
a R122,5m acquisition. ApexHi said yesterday it
had bought the Corbett Portfolio of properties
from Century Retail Developments.  The
acquisition boosts the companys retail component
to 40 of its portfolio and puts it in a stronger
position to take advantage of the retail property
boom. The purchase, which includes five
buildings, will be funded with R74m in cash and
by issuing new units in the fund.  It is the
first major acquisition since ApexHi announced
its intention earlier this month to buy R500m
worth of properties over the next year. Mariette
Warner, fund manager of Stanlib Property Income
Fund, said the acquisition diluted ApexHis
exposure to large tenants in CBD offices.  It
spreads the risk and it is positive, she
said. The buildings in the Corbett Portfolio
include a shopping centre in Botshobelo in the
Free State, two in Hazeyview outside Nelspruit
and a further centre in Kathu in the Cape.  The
remaining building is an office block located in
Nelspruit with retail space on its ground floor. 
Vacancies in the buildings average about 1, the
company said. Half of ApexHis portfolio is
office space, while 10 is industrial.
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Business Report National
31 May 2004
Heres a one-stop shop for the fixed-interest
investor   Flexibility is something of a modern
obsession.  You can negotiate flexible repayment
schedules, flexible staffing solutions, even
flexible office space. In a business environment
where change is constant, flexi is sexy.  In the
investment industry, the concept has even been
brought to fixed interest instruments.
Historically, fixed-interest instruments like
long- and short- dated bonds and gilts were
considered a relatively staid segment of the
investment field. The tempo has picked up in
recent years, however.  For example, over the
last 10 years, bonds have been one of the best
performing asset classes in South Africa,
achieving an average return of about 16 percent a
year. At the same time, the range of instruments
has widened considerably.  The government and
various parastatals still bring their paper to
market, of course.  But so do many blue-chip
corporates. Even companies whose credit ratings
fall a little below the super-solid
classification now issue bonds, as it can be a
cheaper way to raise capital than a loan. A
little more risk may attach to some corporate
bonds, but the yield is commensurately higher.
The promise of good returns, the environments
increased complexity, greater volatility across
all markets and marked differences in the yield
potential of various fixed-interest products have
turned this into an extremely competitive sector.
Fixed-interest teams now have to react more
quickly to market developments while drawing on a
wide range of sophisticated tools to assess risk
and return profiles. To optimise the yield, they
must create the appropriate balance of
fixed-interest products and money market
instruments.  Timing is also vital.  The review
process is therefore constant.  Historically,
such reviews and revised allocations across
instruments were the responsibility of investors
and their financial advisers.  The asset manager
had a mandate directing him into the money
market, bonds or cash. The flexibility to move
between instruments as the market moved was
denied to him. This changes with the creation of
the flexible income fund a way of bringing
cost-effective flexibility to the fixed-interest
arena. The fund rules enable the manager to move
between an array of fixed-interest instruments
and income funds to optimise the investors
returns. Timing issues and adroit reactions to
market changes are left to the professionals. A
financial adviser does not have to arrange a
review session with a client every time market
sentiment changes. The flexible income fund
becomes a one-stop shop for the fixed-interest
investor. This product type presupposes that
canny investors will be prepared to give
substantial freedom to the fund manager a level
of trust that is possible only when a managers
track record is well documented and well into
positive territory.
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Business Report National
31 May 2004
This is certainly the case with the latest
addition to the product landscape
multiaward-winner Henk Viljoen heads the
management team of the latest flexible income
fund. This new development appears to be
confirmation that local investors are still wary
of the risks of equity investment and are
interested in alternatives, or in products that
put a built-in cap on equity exposure. In recent
years, for example, weve seen huge growth by
absolute return funds, and some multimanager fund
of funds structures proclaim their low-equity
status is extremely popular. Does this mean
anti-equity sentiment is now entrenched in the
retail investment market? In the nine months
between Easter 2003 and New Year 2004, local
equity markets saw a 50 percent rise in
value. asset investment at Stanlib, puts normal
demand for new bond issues at about
R30bn/years.                  
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Sake Rapport
23 May 2004
Eiendomstrusts roep halt Dit lyk of die tydperk
van sterk groei in die opbrengste op
eiendomseffektetrusts (EETs) begin afplat. 
Hoewel die kapitaalopbrengs op dié beleggings kan
daal namate rentekoerse styg, is dit nog nie tyd
om bekommerd te raak oor die inkomste-opbrengs
nie. Tot begin vandeesmaand was die 17 aandele op
die JSE Sekuriteitebeurs wat die hoogste
opbrengste gelewer het, almal eiendomsverwant en
kenners raai aan dat beleggers hul blootstelling
behou, al sal die stygende opbrengskoerse op
effekte beteken dat die eenheidsprys van EETs
daal. In tydperke waar rentekoerse en die
inkomste-opbrengs op EETs daal, styg die
eenheidspryse daarvan, en die omgekeerde gebeur
wanneer opbrengte op effekte n stygfase
binnegaan. Sedert laat in Januarie het die
eenheidspryse van EETs stelselmatig gestyg, en
effektekoerse het ook gestyg.  Nou begin dit lyk
of die volgehoue styging in effekte se
opbrengskoerse die eenheidspryse van EETs begin
afdruk. Die afgelope week het die eenheidspryse
van EETs gedaal, soos wat portefeuljebestuurders
reeds geruime tyd waarsku. Dit is nog te vroeg om
erg bekommerd te raak oor dié beleggings, sê mnr.
Sean Segar, portefeuljebestuurder by Stanlib.
Beleggers wat die hoër inkomste nodig het wat
EETs bied en bereid is om n mate van
kapitaalverlies te aanvaar, kan gerus hul
beleggings behou.  Een rede is dat opbrengskoerse
op effekte tot billike waardes gestyg het. 
Volgens Stanlib lyk koerse van meer as 10 nog
aanloklik vergeleke met verlede jaar se 8,8. Die
groot vraag is of die stygings in opbrengskoerse
hier gaan eindig.  Mnr. Murray Morrison van JP
Morgan verwag koerse kan styg van die huidige
10,1 tot 11, en mnr. Herman Steyn van Prescient
Investments Management verwag koerse kan met nog
100 basispunte styg.  Op groter stygings as dit,
sal beleggers begin geld verloor, sê Steyn. Segar
sê inkomste-uitrekings van EETs sal nog groei. 
In die meeste gevalle is die huurooreenkomste
(teen hoër koerse) reeds gesluit, wat beteken die
inkomste-uitrekings van die belegging sal beter
groei. Met die laer rentekoerse is die
finansieringskoste van eiendomsmaatskappye ook
laer en as dié koerse vir lang tydperke vasgestel
is, sal n verhoging in rentekoerse nie
onmiddellik n uitwerking op eiendomsmaatskappye
hê nie. Volgens Segar is dit nie nou die ideale
tyd vir n nuwe belegging in dié sektor nie,
omdat dit onwaarskynlik is dat die opbrengskoerse
van 30 van verlede jaar herhaal sal word.
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Sake Volksblad
27 May 2004
SA beleggers moenie van buiteland af
weghardloop Ondanks sterk rand, olie-skokke en
Irak is daar nog waarde. uid-Afrikaanse beleggers
wat hul blindstaar teen die gebeure in Irak en
die stygende olieprys, is straks besig om te
oorreageer. Verskeie kenners het vandeesweek
gewaarsku dat daar nog waarde in internasionale
markte is, ondanks die hoë olie-pryse en die
negatiewe gebeure in Irak. Selfs die sterk rand
is gn rede om all jou beleggings aan die
buiteland te onttrek nie.  n Gebalanseerde
beleggingsportefeulje behoort n element van
buitelandse aandele of beleggings te bevat.
Pensioentrekkers (om maar net een groep beleggers
te noem) is deesdae blootgestel aan markte en
risikos.  Die meeste pensioenfondse se
bestuurders stuur elke kwartaal oorsigte en
ontledings aan hul lede en dit sou verbaas as
portefeuljebestuurders nie n deel van die
portefeuljes in internasionale markte belê het
nie. Daar is goeie redes hiervoor. Mnr. Anthony
Katakuzinos, hoof van Stanlib se effektetrusts,
wys daarop dat hoewel die rand teenoor die dollar
versterk het, is dit nie noodwendig die geval as
beleggings in ander geldeenhede bereken word nie.
Hy sê die rand se waarde het die afgelope drie
jaar met 15 teenoor die euro verswak en in
dieselfde tyd was die verswakking meer as 10
teenoor die Britse pond. Katakuzinos wys ook
daarop dat daar beleggings in VSA-portefeuljes is
wat goed gevaar het ondanks die swakheid van die
dollar.  Beleggers wat in gebalanseerde
portefeuljes belê het en wat blootgestel was aan
die Britse, Europese en Asiatiese markte, het
baie goed gevaar, sê hy. Mnr. Neels van Schaik
van PSG sê die daaglikse negatiewe gebeure in die
buiteland behoort nie beleggers af te skrik nie. 
Hy is positief oor die ekonomiese groei in Europa
en daar is tekens van herstel in die
winsgewendheid van Europese maatskappye.  Hy
twyfel of die olieprys op die huidige hoë vlakke
gehandhaaf kan word. Hy sê die invloed van die
skerp styging in die pryse van kommoditeite op
die inflasiekoerse in die buiteland is nie so
hewig soos wat soms gemeen word nie. Hy voorsien
nie dat die styging in kommoditeitspryse
(oliepryse ingesluit) internasionale inflasie
gaan laat handuit ruk nie. Indien Van Schaik se
voorspellings reg is, behoort dit soos
Katakuzinos se siening rede tot gerusstelling te
wees. Suid-Afrikaanse beleggers wat n gewoonte
daarvan maak om elke dag na die warde van hul
beleggings te kyk, sou waarskynlik geskrik het
angesien Mei nie n goeie maand is nie. Die
tradisionele Amerikaanse waarskuwing sell in
May is vandeesmaand bewaarheid.  Baie mense
beskou dit bloot as n bygeloof, maar daar is
ander wat baie waarheid aan die gesegde heg.
Suid-Afrikaanse moet in ag neem dat die
Suid-Afrikaanse ekonomie baie klein is in die
wêreldekonomie. Katakuzinos sê die
Suid-Afrikaanse ekonomie verteenwoordig net 0,5
van die wêreldekonomie.  Om all jou beleggings in
so n klein land te hê, is nie baie wys nie.
Onthou jou huis en ander beleggings is
blootgestel aan die Suid-Afrikaanse mark.  Dit
maak dus sin om na die buiteland te
diversifiseer. Op lang termyn is dit n gesonde
beleid.  Beleggers in Suid-Afrika neig soms om
paniekerig te raak wanneer sake in die buiteland
verkeerd loop.
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Leadership
01 May 2004
Economic growth of the magnitude of that of China
and Russia many times faster than South
Africas must have an impact on resource demand
and hence on investment in offshore funds, no
matter the state of the rand, says Paul Hansen. 
All thats necessary is an old-fashioned
virtue. The 2002 merger of the Standard Bank and
Liberty asset management companies predictably
resulted in StanLib offering a number of unit
trusts that were almost identical. When the
merged entity compressed 73 funds into 49 earlier
this year, however, the Standard Bank
International Conservative fund of funds, was not
amongst them. While the Liberty deal has added a
slew of new choices for clients wanting
international exposure, The Fidelity managed fund
continues to do what it says on the box.
According to Paul Hansen, director of retail
investments at Stanlib and fund manager of the
Standard Bank International Conservative fund of
funds, the aim is to provide a vehicle for the
conservative local investor, who seeks some
exposure to foreign markets.  It is only
permitted to hold a maximum of 10 percent in
equity with a minimum 90 percent in fixed
interest. The fund is for the very cautious
investor looking for just a little more than
money market returns and wanting professional
management of currencies, which means being in
the right currencies and out of the wrong ones
most, if not all, of the time, said Hansen. By
contrast, the recently launched StanLib Global
Focus fund is equity-only with much higher risk
and, potentially, a much higher return.  Hansen
believes, however, that both funds will benefit
as South African investors cautiously look toward
diversifying their portfolios into offshore
markets again.  A strong rand and the regulation
of offshore holdings mean any turnaround is
likely to take place over a lengthy period of
time. Most investors are not only treading
carefully, but at the moment (late March 2004),
there are seven investors on average per day
bringing their money back from offshore (via
Standard Bank Offshore unit trusts) versus an
average of one investor going offshore, said
Hansen. We are seeing many individual investors
selling out of our asset swap unit trusts
(rand-based unit trusts that invest offshore),
almost entirely offset, however, by the
occasional very big investor placing funds in
these unit trusts often R10 million to R25m at
a time. The Standard Bank International
Conservative fund of funds invests in different
unit trusts, unlike a multi-manager, which places
funds with different fund managers according to a
mandate. 
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Leadership
01 May 2004
Hansen manages the fund using Fidelity unit
trusts therefore he decides how much to have in
bonds, equities, currencies, and which specific
currencies, bonds or equities to hold.  Fidelity,
however, picks the actual offshore shares or
individual bond through its unit trusts. The
fund currently holds six different Fidelity unit
trusts and that is probably about average, said
Hansen.  We like Japan for equities and we have
just raised our holding in these to five percent
of the fund, which is high as we can only hold a
maximum of 10 percent in equities. He makes
special mention of the Fidelity European Growth
(a three percent holding), which holds
predominantly medium to smaller cap shares in
both Europe and the UK.  Such shares are not
typically as affected by strong currencies, as
are the big shares. On the bond side, Hansen
likes high-yield bonds and has eight percent of
the fund invested in the Fidelity Euro High Yield
fund and 6.5 percent invested in the US High
Yield fund.  Both pay about six percent interest.
We like the high-yield bond funds because
companies that issue these funds typically
those with more debt do better in times like
now where the economy is growing nicely as cash
flows improve and profits grow.  These bonds are
not that sensitive to movements in government
bonds. Hansen prefers the euro and sterling
among the currencies because of their high
yields, but is mindful of the big knock that the
dollar has already taken.  The fund is currently
holding dollar cash short-term to benefit from
its current rally.  Officially, the SB
International Conservative fund of funds is
mandated to long-term growth of capital and
income.  According to Hansen, however, it
unofficially aims for absolute return a
positive return every year in the base currency,
US dollars. This implies keeping the risks low,
he said.  In turn this has led to us holding
very little in offshore bonds over the past 18
months because of our concern that the bond cycle
could be turning offshore as the economies and
stock markets turned upwards. By maintaining a
heavy under-weighting in government bonds, the
fund is currently carrying a lower risk profile
than its benchmark.  Hansen believes it has been
successful in meeting its objective, which is to
generate a positive return in dollars every year
and to outperform money markets. The fund has
averaged 6.7 percent per year in dollars over the
past three years (to end January 2004), including
the bear market in equities, he said.  In 2003,
the fund did 12.6 percent in dollars, which was
higher than expected because of catching the big
run in the euro versus the dollar and the pound. 
The 10 percent invested in equities helped a lot
too, as this part of the portfolio appreciated by
some 50 percent in dollars. Hansen concedes,
however, that the funds return for South African
investors has been sharply affected by the
extraordinary strength of the rand.  In the three
years to end January 2004, the fund generated a
small positive annual rand return of 3.4
percent. Another contributing factor was the
relative under-performance of the Fidelity
flagship equity fund,
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Leadership
01 May 2004
although Hansen is quick to point out that a
number of Fidelitys other funds were top
performers.  Stanley has 31 fidelity funds on its
offshore platform and eight on its onshore
platform. Fidelity manages most of Stanleys
International retail unit-trust product, but the
institutional product is all provided via Liberty
Ermitage, which also manages all Liberty Lifes
insurance funds offshore. While this arrangement
can create some confusion, it was the inevitable
consequence of merging the asset management
businesses of Standard Bank and Liberty.  Of the
49 merged funds 30 have been branded StanLib
while 19 are under the umbrella of the StanLib
multi-manager range. Since inception, StanLibs
share of the unit-trust market has grown from 15
to about 18 percent.  No amount of branding,
however, can compensate for the effects of a
fluctuating currency and Hansen is critical of
the rand.  Yes, the rand has structural
problems, such as inflexible labour laws which
make us uncompetitive with countries like India,
China and others, he said.  The Aids epidemic
is clearly a negative, as is the Zimbabwean
crisis. The Stanlib house view is the rand is 15
percent overvalued relative to major trading
partners currencies such as the euro, sterling,
yen and US dollar.  Hansen predicts that may
unwind as 2004 progresses.  He is mindful of the
positive effect on the rand of the commodity boom
and of the big gap between local interest rates
and those of our large offshore trading
partners.  He is excited by other foreign indices
exhibiting a great deal of market dynamism. 
Some large economies have been growing at five
to nine percent a year about three times faster
that were growing, he said. China and Russia
must have an impact on resource demand.  We cant
see global forces of this magnitude being
cancelled out by the rand. Hansen has the
following sage advice for retail investors
considering the relative merits of investing in
offshore funds I think investors need to be
patient when investing in offshore funds like
this one, at least as far as expecting a good
rand return goes.  Usually patience pays off in
investing, whether in houses, shares, unit
trusts, most things at times ones patience can
be stretched, but inevitably is rewarded.
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