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Welcome to the Sharenet Daily Equity Report
 Issue: 26 January 2011 20:00

Another look at offshore versus local

Asset Class returns per calendar year

Source: Investec

A graphical format of various asset class returns such as this produced by Investec, provides a very clear picture of the range and variance of returns over any 12 month period.

At the same time, by colour coding the best and worst asset class in each particular year, we do see that returns occasionally bunch together, so that in 2002 to 2007, listed property was the star performer, while for the years 2003 to 2010, except for 2008, offshore cash was the worst performer.

What is not so obvious from this table is the fact that offshore equities produced a far superior return compared to local equities in the period 1991 to 2001, despite only being the top performer in 2 years, compared to 4 years for the local equities.

From the beginning of 1991 to end of 2001 offshore versus local would have been as follows:

• investment in foreign equities - a cumulative 1172%
• Local equities – a cumulative 416%.

As we all know this reversed completely over the following 9 years as global equities declined from their expensive levels to more attractive prices, while at the same time South African investors experienced the impact of a firming rand as it reversed from extremely oversold levels to far more expensive levels.

From the beginning of 2002 to the end of 2010 offshore versus local would have been as follows:

• investment in foreign equities - a cumulative loss of 15%
• local equities – a cumulative gain of 300%

SA Equities relative to US Equities (S&P500)

The chart below reflects the price to earnings of the local JSE to that of the US market. It is quite clear that relative valuations oscillate around some mean (which will also naturally change with time).

At times local equities tend to be more expensive when compared to global developed equities and vice versa.

Since 1990, there have been 3 distinct periods when US equities were cheaper – 1994, 2005/2006 and at current valuations

These periods are indicated by the circled peaks on the chart below, where relative valuations move beyond 1 standard deviation.

Source: Inet

Clearly investors have been very disappointed with the returns from offshore over this last decade, after a boon in the 1990’s. Investors at the time should have simply looked at such a relative valuation chart and they would have seen that offshore was expensive relative to local at the time.

The current scenario is however establishing itself as a wonderful starting point for excess returns from global equities over the next 10 years, given the relative valuations and the firm level of the local currency.

This is not to say that local investors should sell all local equities, but there is a sound case for a strong tilt to offshore.

Investment presentation in Jhb

There are a few seats still available. please contact Myrna on details below

- Market overview in 30 minutes. Ian de Lange: CA(SA)

- How to position your retirement portfolio. Vincent Heys: Actuary

Date: 15 February 2011
Time: 5:30pm for 6:00pm
RSVP: 8 February 2011 myrna@seedinvestments.co.za
Venue: Regus
2nd Floor West Tower
Nelson Mandela Square
Maude Street


Ian de Lange

021 9144 966

Wed, 26 Jan 2011

Impala Platinum, the world's second-largest producer of the precious metal, said on Wednesday its first-half earnings likely increased by up to 65 percent, lifted by stronger sales and higher prices.  Full story
Mass protests in Egypt, one of the darlings of African and Middle Eastern investors, sharply increase the risks that international investors will withdraw funds from some other economies in the region.  Full story
Remigius Okafor's hair-care products distributors used to risk theft by carrying thousands of dollars into Sierra Leone's ramshackle capital to pay him for supplies.  Full story
South Africa's Barloworld said on Wednesday its October-December results showed strong improvement, helped by demand for equipment from the mining industry.  Full story

16h30 South Africa's Harmony Gold said it will resume late on Wednesday operations at its Bambanani mine, which were halted last week. . .  Full story
15h22 Air Mauritius will fly direct to China from July in a move it hopes will help boost tourism in the Indian. . .  Full story
12h15 Maize deliveries to South African silos rose to 11.747 million tonnes in the week to Jan 21, up from 11.733 million. . .  Full story
09h23 South Africa's rand steadied against the dollar on Wednesday, with some dealers seeing it struggle to go firmer than 7.00 on. . .  Full story

Trading Statistics


Major Moves Up
SharenameSaleMove% MoveVolume
1 MASONITE  32502407.97.%1000
2 MMG  220167.84.%94049
3 BAUBA  226146.60.%16937
4 BRAIT  23001004.55.%299011
5 CMH  1400503.70.%9301
6 VERIMARK  17063.66.%175318
7 SHOPRIT  93302803.09.%4563908
8 SPAR  94252702.95.%467936
9 CERAMIC  146004002.82.%2600
10 MONDILTDP  56521522.76.%164074
11 CITYLDG  72501902.69.%124967
12 ANGLO  353009252.69.%4363342
13 METOREX  546142.63.%1888167
14 MRPRICE  58991482.57.%1478582
15 AFRO-C  16542.48.%22108
16 JUBILEE  37492.47.%990932
17 GBGOLD  1767422.43.%4042
18 BILLITON  275536492.41.%4570196
19 RANGOLD  30572.35.%8574
20 ABSA  138013012.23.%516305

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Major Moves Down
SharenameSaleMove% MoveVolume
1 IPS  111-19-14.62.%6000
2 ILIAD  800-63-7.30.%5281
3 LONAFRIC  200-10-4.76.%3100
4 DIGICOR  301-14-4.44.%15000
5 CROOKES  3999-186-4.44.%900
6 RAINBOW  1625-73-4.30.%15574
7 PALLINGHT  416-17-3.93.%256994
8 SACOIL  145-5-3.33.%901918
9 PHUMELELA  1150-35-2.95.%1578
10 SILVERB  165-5-2.94.%15000
11 CASHBIL  9000-250-2.70.%2851
12 RAUBEX  2306-64-2.70.%103366
13 ARB  305-8-2.56.%11315
14 AMA  205-5-2.38.%159000
15 GOLDONE  220-5-2.22.%112012
16 SPURCORP  1380-30-2.13.%7450
17 PETMIN  295-6-1.99.%52408
18 NEDCOR  13020-220-1.66.%481187
19 PINNACLE  675-11-1.60.%88759
20 OCEANA  3690-60-1.60.%1500

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New Highs
SharenameSaleHighMove% MoveVolume
1 VERIMARK  17017563.66.%175318
2 CERAMIC  14600146004002.82.%2600
3 CBH  36036851.41.%29904
4 FREEWORLD  1167125080.69.%16335
5 BARWORLD  67506869450.67.%2380490
6 URONE  42544330-14-0.33.%28675

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New Lows
SharenameSaleLowMove% MoveVolume
1 CITYLDG  725070101902.69.%124967

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Spot Prices
NameTimeRPMove% Move
JSE Overall17:0031965.24308.610.97%
JSE Top 4017:0028647.40313.281.11%
JSE Gold17:002510.989.070.36%
JSE Financial17:0021558.5950.180.23%
JSE Industrial17:0031751.74227.290.72%
JSE Indust 2517:0026350.29204.570.78%
JSE Resource17:0056807.59886.031.58%
DJ Futures19:3211936.0014.000.12%
DJ Ind19:4111992.7415.550.13%
SP 50019:461296.385.200.40%
FTSE 10018:355969.2151.500.87%
All Ords25/014909.0020.900.43%
NZSE 5006:263354.72-4.35-0.13%
NameTimeRPMove% Move
Gold/R kg19:5630318429490.98%
Brent Crude19:5696.641.841.94%
Rand / Dollar19:597.09100.04340.62%
Rand / Pound19:5511.22360.09350.84%
Rand / Euro19:559.69890.04370.45%
Rand / NZD19:585.42060.00640.12%
Rand / AUD19:557.05350.02050.29%
Yen / Dollar19:5482.45000.26000.32%
Euro / Dollar19:550.7307-0.0001-0.01%
Dollar / Euro19:571.3683-0.0001-0.01%
Pound / Dollar19:550.6296-0.0023-0.36%

Click here for the Sharenet Spot Price page
Index Summary
Index NameRPMove% Move
Top 4028,647.40313.281.11%
Mid Cap42,193.59117.930.28%
Small Cap32,732.9923.970.07%
Resource 2056,807.59886.031.58%
Industrial 2526,350.29204.570.78%
Financial 158,166.9621.690.27%
Financial & Ind. 3029,732.09194.770.66%
All Share31,965.24308.610.97%
Oil & Gas 26,919.58-138.01-0.51%
Mining 37,441.24695.361.89%
Gold Mining2,510.989.070.36%
Platinum Mining80.76.560.70%
Oil & Gas Producers 14,474.16-74.21-0.51%
Basic Materials 31,463.65547.951.77%
Chemicals 13,586.7154.680.40%
Forestry & Paper 13,097.94122.120.94%
Industrial Metals 29,458.0259.300.20%
Industrials 29,590.56108.030.37%
General Industrials 77,575.79503.960.65%
Consumer Goods 25,933.61185.970.72%
Automobiles & Parts 2,819.25.000.00%
Household Goods147.0621.18%
Health Care 32,376.45231.680.72%
Beverages 80,307.381141.341.44%
Food Producers 48,069.99-185.88-0.39%
Index NameRPMove% Move
Personal Goods 400.30.200.05%
Consumer Services 52,248.86696.891.35%
General Retailers 39,304.58281.890.72%
Travel & Leisure 4,077.679.440.23%
Media 84,464.921141.151.37%
Support Services 2,544.26-44.13-1.70%
Telecommunications 62,376.22203.950.33%
Financials 21,558.5950.180.23%
Banks 40,648.17-14.19-0.03%
Non-life Insurance 30,328.3475.170.25%
Life Insurance 15,692.0083.150.53%
General Financial 2,351.5413.710.59%
Technology 20,501.45-34.56-0.17%
SHARIAH TOP40 3,219.70441.38%
FTSE/JSE SHARIAH ALL3,284.91411.27%
COAL MINING20,817.27770.37%
FTSE JSE Fledgling 4,753.11-3-0.06%
FTSE/JSE Alt X 1,114.82-6-0.51%
RESOURCE 31,253.254871.58%
DIVIDEND PLUS173.3900.24%
FTSE/JSE RAFI 406,660.99590.89%
Capped Top 4014,862.541400.95%
Capped All Share16,057.131440.90%

Click here for the Sharenet Index Summary page
Latest Consensus Changes**
CodeCompany NameStatusUpdated
Results Expected**
ExpectedCompany NameFin. Date
25 Jan 2011SPESCOMMarch 2011 (Interim)
26 Jan 2011CBHDecember 2010 (Interim)
28 Jan 2011HUDACONovember 2010 (Final)
31 Jan 2011CAPITALDecember 2010 (Final)
02 Feb 2011GIJIMADecember 2010 (Interim)

Recent Dividends**
Share NameDec-DateLDTPay-DateAmount
FOORDCMPS11-01-2011-02-0411-02-14R 0.5385
DIALOGUE11-01-1311-02-1811-02-28R 0.1238
SBRJSEP1110-12-1511-03-0411-03-15R 1.4100
WINHOLD10-11-2911-02-1111-02-21R 0.1000
UCS10-11-2311-02-0411-02-14R 0.0500
Ex Div**
Share NameDec-DateLDTPay-DateAmount
CLICKS10-10-2111-01-2111-01-31R 0.7570
FREEWORLD10-11-2411-01-2111-01-31R 0.0700
NAMPAK 6.510-12-0911-01-2111-01-31R 0.0650
NAMPAK 6%P10-12-0911-01-2111-01-31R 0.0600
REUNERT5.511-01-0511-01-2111-01-31R 0.0550

Upcoming AGMs**
CodeCompany NameDateStatus
NCANew Corpcapital Ltd26/01/2011Confirmed
SDHSecureData Holdings Ltd26/01/2011Confirmed
RINRedefine Properties International Ltd26/01/2011Confirmed
LHCLife Healthcare Group Holdings Ltd27/01/2011Confirmed
AIPAdcock Ingram Holdings Ltd27/01/2011Confirmed

Stock Exchange News Service
26/01/201117:22 IFCA Technologies Limited - Board Restructure
26/01/201117:18 PSG Group Limited - Dealing in securities by the PSG Group Limited
26/01/201117:00 Impala Platinum Holdings Limited - Trading statement
26/01/201116:54 EOH Holdings Limited - Dealings in securities by director
26/01/201116:10 S A French Limited - Further cautionary announcement
26/01/201116:07 Sasol Limited - Replacement of announcement sent at 14h00 - Listing of
26/01/201116:02BAW/ BAWP - Barloworld Limited - Results of the annual general meeting
26/01/201116:01 Country Bird reports significant growth at interim stage
26/01/201116:00 Country Bird Holdings Limited - Interim results for the period ended 31
26/01/201115:50 RMBH - Updated timetable for the proposed RMBH restructuring
26/01/201115:33 Alert Steel Holdings Limited - Further cautionary announcement
26/01/201115:30 Redefine Properties International Limited - Results of Annual General
26/01/201115:11 Cashbuild Limited - Change to the board of directors
26/01/201114:50 Securedata Holdings Limited - Results of annual general meeting
26/01/201114:42 Platfields - Acquisition of claim in respect of Prospecting Rights over
26/01/201114:21 Capitec Bank Holdings Limited - Resignation of a non-executive
26/01/201114:05 EOH Holdings Limited - No change statement and notice of annual general
26/01/201114:00 Sasol - Listing Of Sasol Bee Ordinary Shares on the Bee Segment of the
26/01/201112:30 Barloworld Limited - Trading update
26/01/201111:56 Wits Gold - Wits Gold Reports Seismic Survey Results
26/01/201111:50 Jubilee Platinum PLC - Jubilee acquires 51% of shares and claims in
26/01/201111:11 Pioneer Food Group Limited - Dealing in company`s shares by a director
26/01/201109:58 John Daniel Holdings Limited - Company Secretary Update Announcement
26/01/201109:00 Marshall Monteagle Holdings Societe Anonyme - Circular to shareholders
26/01/201108:30 Growthpoint - Renewal of cautionary announcement
26/01/201108:17 Resgen - Quarterly Report for the three months ended 31 December 2010
26/01/201108:00STX40 - SATRIX 40 - Listing of additional Satrix 40 securities
26/01/201107:05 BHP Billiton Plc - Transaction in shares

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