The Sharenet Daily 
Thursday, 05 May 2011 - 20:00
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Top News
SA Business
Company News
Company Results
World Markets (Spot Prices)
JSE Today
JSE Trading Statistics
Major Moves
Index Summary
Latest Consensus Changes / Results Expected
Recent Dividends / Ex Div
Upcoming AGMs
Stock Exchange News Service (SENS)

Sell in May and Go Away?

Before I start the report today, Seed has a Facebook page for those investors that would like to be directed to, and informed of, current investment news. Click here to head to our Fan page and click ‘Like’ at the top of the page in order to get access to this news.

There is an old adage in the investment industry that goes along the lines of “Sell in May and Go Away”. The theory goes that investors are better off if they sell their shares at the beginning of May; put the money in the bank (cash), and then only look to buy again at the end of October. In this way they would be in the market for 6 months and in cash for 6 months of each year.

With the ALSI down over 4% on the first three trading days of May, I got thinking about this saying.

Is there any truth in the tale?

Before going any further, any analysis not based on fundamental logic/reasoning can’t be taken seriously. The below analysis should merely be seen as an observation, not some kind of investment strategy. As Nassim Taleb (author of Fooled by Randomness and The Black Swan) says, humans have a way of creating patterns in places where none exist.

I took a look at return data of the local All Share Index over the past 41 years (starting in 1970). When comparing the returns of the market from 1 May – 31 October (bad months) to the rest of the year we can see that there is a marked difference between the two.

We can further see from the chart above that the ALSI still manages to beat cash in the bad months, and investors would therefore still be better off keeping their money in the market (albeit with significantly more volatility than cash). Global markets seem to follow the same trend of a better November to April period (23 years of data).

The average return is a full 6.5% higher in the November – April (good months) when compared to the bad months. Taking a look at the outlier years, we see that both periods still both experienced high maximum and low minimum returns. This adage therefore doesn’t work all of the time. In fact, the bad months had a ‘better than average return’ in 18 of the 41 years (44% of the time)

When breaking down the returns into the individual months we can see that these 6 monthly returns are particularly skewed by a few outlier months, namely December (historically a good month) and June (historically a bad month).

In fact, if we shifted the bad months to 1 June – 30 November there would be an even greater difference in the return profiles.

It is clear that over the past 41 years investors generally received a better return in the period 1 November – 30 April than 1 May – 31 October. What is less clear is whether this will be the case going forward.

Remember that it is fairly straight forward (when armed with some Excel skills) to mine and manipulate data to show trends, it is another matter altogether to make sensible conclusions from these trends.

If successful investing was as simple as investing in the ALSI for the 9 months when markets have historically given you cash beating returns and sitting in cash for the other three months, everyone would be able to quit their day job. One would need to look deeper at the reasons for the disparity in the returns in order to make any sensible conclusion.

At Seed we continue to look at the fundamental value of the various asset classes before making decisions to buy or sell the assets.

Take care,

Mike Browne
021 9144 966

Thu, 05 May 2011
Top News
South African assets took a beating on Thursday as a combination of lower metal prices, worries about global growth and a rising dollar hurt sentiment.  Full story

South African group Harmony Gold fell short of market expectations with a 32 percent rise in quarterly profit after a slow restart following its annual Christmas shutdown led to a drop in production.  Full story
Commodities plunged for a fourth day on Thursday, dragging down stocks and fueling demand for safe-haven assets, after new data cast more doubts on the strength of the global economic recovery.  Full story
A car bomber killed more than 20 people and wounded 80 Thursday at a police building in the mainly Shi'ite city of Hilla, an official said, as Iraq braced for revenge attacks after U.S. commandos killed Osama bin Laden.  Full story
In 2003 or 2004, Pakistani intelligence agents trailed a suspected militant courier to a house in the picturesque hill town of Abbottabad in northern Pakistan.  Full story
The Dow and S&P 500 dipped on Thursday after a weak labor market report, but losses were capped as a steep drop in. . .  Full story
European shares fell on Thursday, with disappointing results weighing on banking stocks, while heavyweight mining firms tracked a pullback in commodity prices on growing. . .  Full story
Silver plunged 7 percent on Thursday, heading for its biggest weekly loss since 1983 and dragging gold 2 percent lower, as panic selling. . .  Full story
Sliding commodity prices thumped energy stocks and miners while Lloyds Banking Group led financials down, pulling Britain's top share index lower on Thursday, with. . .  Full story

Disappointing results from European banks dragged stocks lower on Thursday while investors waited for the European Central Bank to give hints on the. . .  Full story
European shares fell on Thursday, led by banks after weak earnings news from companies including Lloyds, and with investors cautious ahead of the. . .  Full story
Hong Kong shares ended at a five-week low as persistent weakness in energy counters offset gains by some financials, while index futures signalled. . .  Full story
Australian shares rose 0.3 percent on Thursday, boosted by a rally in National Australia Bank after its record earnings beat forecasts, and more broadly. . .  Full story
SA Business
South Africa's business confidence index fell to 86.9 points in April from a 30-month high of 88.3 in March, the South African Chamber of Commerce and Industry (SACCI) said on Thursday.. . .  Full story
South Africa's rand firmed against the dollar in early Thursday trade as commodities looked to recover but retreated further away from a tough resistance area tested earlier in the week.. . .  Full story

South Africa produced 1.43 million tonnes of wheat during the 2010 season compared with 1.958 million tonnes in 2009, the country's. . .  Full story
Government support for renewable energy must end gradually and in tandem with cuts in fossil fuel subsidies, say investors and lobbyists who complain. . .  Full story
The global supply of platinum is expected to rise slightly this year, with upcoming wage talks in top producer South Africa. . .  Full story
Aquarius Platinum said it would boost its resource base by nearly a quarter as it announced a mineral rights acquisition that. . .  Full story
Company News
The group has had a strong performance for the first six months to 31 March 2011, with Headline earnings per share. . .  Full story
Further to the trading statement released on SENS on 14 March 2011, shareholders are advised that the group's basic and diluted. . .  Full story
Vukile linked unitholders are referred to the announcement published on SENS on 11 April 2011 regarding the acquisition of Giyani Plaza. . .  Full story
Holders of securities in Trencor are advised that Textainer Group Holdings Ltd (NYSE: TGH), in which Trencor has a 60.9% (31. . .  Full story

Shareholders are referred to the circular to Simmers shareholders dated 2 March 2011 ("the circular"), the circular to Village shareholders dated. . .  Full story
The Lewis Group advises that, for the year ended 31 March 2011, its earnings per share and headline earnings per share. . .  Full story
Shareholders were advised that at the annual general meeting held on 5 May 2011, all resolutions were passed with the requisite. . .  Full story
Shareholders are referred to various announcements released on SENS of the JSE Ltd ("JSE") and the circular to shareholders dated 9. . .  Full story
Company Results
Revenue increased marginally to R22.8 billion (R22.3 billion) and earnings before interest, tax, depreciation and amortisation (EBITDA) rose to R2.1 billion. . .  Full story
Rent received amounted EUR1.7 million (February 2010: EUR 291 000) for the company's full-year results as at 28 February 2011. Results. . .  Full story
Total revenue for the interim period rose to R1.678 billion (2010: R1.481 billion). Net operating income increased to R1.222 billion (2010:. . .  Full story
Revenue for the period increased to R85.6 million (2010: R79.9 million) . Gross profit rose to R47 million (2010: R43.9. . .  Full story
World Markets (Spot Prices)
NameTimeRPMove% Move
JSE Overall17:0031582.14-274.50-0.86%
JSE Top 4017:0028324.46-251.81-0.88%
JSE Gold17:002581.50-24.65-0.95%
JSE Financial17:0021258.00-202.86-0.95%
JSE Industrial17:0032427.78-108.01-0.33%
JSE Indust 2517:0027163.03-77.05-0.28%
JSE Resource17:0054067.84-755.92-1.38%
DJ Futures19:4612630.00-49.00-0.39%
DJ Ind19:4112661.97-61.61-0.48%
SP 50020:001342.43-4.89-0.36%
FTSE 10017:355919.98-64.09-1.07%
All Ords08:374828.9015.100.31%
NZSE 5007:123501.393.130.09%
NameTimeRPMove% Move
Gold/R kg20:00318968-11911-3.60%
Brent Crude19:56112.78-7.85-6.51%
Rand / Dollar19:596.71630.03630.54%
Rand / Pound19:5511.03090.04970.45%
Rand / Euro19:559.8086-0.0929-0.94%
Rand / NZD19:585.29010.01530.29%
Rand / AUD19:557.1595-0.0075-0.10%
Yen / Dollar19:5880.1900-0.4600-0.57%
Euro / Dollar19:550.68670.01271.88%
Dollar / Euro19:591.4559-0.0263-1.77%
Pound / Dollar19:550.60870.00280.46%

Click here for the Sharenet Spot Price page
The JSE Today
Trading Statistics

Major Moves Up
SharenameSaleMove% MoveVolume
1 AFRIMAT  360205.88.%108877
2 INVICTA  42502055.07.%12440
3 LEWIS  80703704.81.%383736
4 GRANPRADE  314144.67.%56141
5 URONE  29991324.60.%135913
6 VERIMARK  14664.29.%800
7 PLATMIN  577173.04.%1600
8 STEFSTOCK  1220352.95.%46701
9 PINNACLE  730202.82.%141704
10 AMA  18352.81.%68287
11 EASTPLATS  789212.73.%277139
12 MONDIPLCP  65711712.67.%2127623
13 EHSV  53001302.51.%46884
14 COMAIR  22552.27.%10043
15 BATS  297115912.03.%1493673
16 BRIMST-N  688131.93.%80000
17 WESIZWE  23341.75.%777035
18 TELEMASTR  12721.60.%1500
19 DISTELL  72001101.55.%340
20 SASFIN  3395451.34.%28500

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Major Moves Down
SharenameSaleMove% MoveVolume
1 ROLFES  152-18-10.59.%820
2 TRUSTCO  110-10-8.33.%188000
3 ALTRON  2899-216-6.93.%28221
4 SILVERB  140-10-6.67.%50000
5 AFRO-C  185-10-5.13.%14354
6 SACOIL  158-7-4.24.%2317503
7 OPTIMUM  3000-130-4.15.%375298
8 SENTULA  278-12-4.14.%370128
9 ACUCAP  3442-136-3.80.%166828
10 PBT  128-5-3.76.%22400
11 PREMIUM  1635-55-3.25.%2119
12 EXXARO  16300-500-2.98.%1510705
13 FREEWORLD  1180-36-2.96.%700
14 COAL  862-26-2.93.%170999
15 ANOORAQ  622-18-2.81.%92562
16 IMPLATS  18415-505-2.67.%3837684
17 JUBILEE  296-8-2.63.%225848
18 LONMIN  17090-452-2.58.%54690
19 ELBGROUP  1950-49-2.45.%86841
20 STEINHOFF  2390-60-2.45.%5391709

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New Highs
SharenameSaleHighMove% MoveVolume
1 BATS  29711297525912.03.%1493673
2 MVELARES  425447-3-0.70.%2350397
3 OCEANA  39904050-35-0.87.%63120
4 CAPCO  18651977-24-1.27.%714863

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New Lows
SharenameSaleLowMove% MoveVolume
1 INVPROP  10251025-5-0.49.%47000

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Index Summary
Index NameRPMove% Move
Top 4028,324.46-251.81-0.88%
Mid Cap41,486.90-360.86-0.86%
Small Cap32,160.33-24.25-0.08%
Resource 2054,067.84-755.92-1.38%
Industrial 2527,163.03-77.05-0.28%
Financial 158,029.13-73.44-0.91%
Financial & Ind. 3030,293.35-144.43-0.47%
All Share31,582.14-274.50-0.86%
Oil & Gas 26,870.22-524.57-1.91%
Mining 35,555.66-468.41-1.30%
Gold Mining2,581.50-24.65-0.95%
Platinum Mining70.27-1.67-2.32%
Oil & Gas Producers 14,447.62-282.05-1.91%
Basic Materials 30,056.78-358.79-1.18%
Chemicals 13,439.05-165.84-1.22%
Forestry & Paper 14,304.88171.441.21%
Industrial Metals 28,865.05-99.16-0.34%
Industrials 27,445.86-153.35-0.56%
General Industrials 75,586.52-434.62-0.57%
Consumer Goods 26,804.36-100.84-0.37%
Automobiles & Parts 3,192.8933.971.08%
Household Goods151.89-4-2.45%
Health Care 31,800.15-89.25-0.28%
Food Producers 47,363.11-529.99-1.11%
Index NameRPMove% Move
Personal Goods 416.48-1.80-0.43%
Consumer Services 52,789.82-398.15-0.75%
General Retailers 41,338.65-272.87-0.66%
Travel & Leisure 3,724.99-17.57-0.47%
Media 81.97-.78-0.94%
Support Services 2,370.266.740.29%
Telecommunications 69,267.63178.890.26%
Financials 21,258.00-202.86-0.95%
Banks 39,599.23-550.88-1.37%
Non-life Insurance 31,567.4743.650.14%
Life Insurance 15,891.22-57.61-0.36%
General Financial 2,224.39-22.53-1.00%
Technology 20,512.94-153.78-0.74%
SHARIAH TOP40 3,154.85-33-1.04%
FTSE/JSE SHARIAH ALL3,217.00-33-1.01%
COAL MINING22,049.63-726-3.19%
FTSE JSE Fledgling 4,505.15-16-0.36%
FTSE/JSE Alt X 1,016.68-5-0.46%
CAPPED PROPERTY 310.21-1.13%
RESOURCE 29,871.05-418-1.38%
DIVIDEND PLUS167.45-1-0.85%
FTSE/JSE RAFI 406,596.71-59-0.88%
Capped Top 4014,771.05-127-0.86%
Capped All Share15,901.14-136-0.85%

Click here for the Sharenet Index Summary page
Latest Consensus Changes**
CodeCompany NameStatusUpdated
Results Expected**
ExpectedCompany NameFin. Date
06 May 2011FINBONDFebruary 2011 (Final)
06 May 2011METMARFebruary 2011 (Final)
06 May 2011MIRANDAFebruary 2011 (Interim)
09 May 2011ASTRAPAKFebruary 2011 (Final)
09 May 2011ASTRAPAKPFebruary 2011 (Final)

Recent Dividends**
Share NameDec-DateLDTPay-DateAmount
ALTRON11-05-0411-06-2411-07-04R 1.0800
ALTRON PP11-05-0411-06-2411-07-04R 1.0800
REDEFINE11-05-0411-05-2011-05-30R 0.1600
BARWORLD611-05-0311-05-2711-06-06R 0.0600
REDEFINTL11-05-0311-05-0911-05-26R 0.0203
Ex Div**
Share NameDec-DateLDTPay-DateAmount
PHUMELELA11-04-0811-04-2811-05-09R 0.2500
VIVIDEND11-04-0811-04-2811-05-09R 0.0996
ZEDER11-04-1111-04-2811-05-09R 0.0400

Upcoming AGMs**
CodeCompany NameDateStatus
MNDLPMondi Ltd05/05/2011Confirmed
MNDMondi Ltd05/05/2011Confirmed
WEZWesizwe Platinum Ltd05/05/2011Confirmed
NBKONedbank Ltd05/05/2011Confirmed
NBKPNedbank Ltd05/05/2011Confirmed

Stock Exchange News Service
05/05/201117:03ABCD01 - ABSA Bank Limited - Notice of expiry and maturity
05/05/201117:00BAW/BAWP - Barloworld Limited - Trading Statement
05/05/201116:58 Jasco - Update to changes to the board previously announced
05/05/201116:58 Cadiz Holdings Limited - Trading Statement
05/05/201116:56 Vukile Property Fund - Further announcement regarding the acquisition of
05/05/201116:53 1time holdings Limited - Dealings in securities by directors
05/05/201116:52 Finbond Group Limited - Audited results for the 12 months ended 28
05/05/201116:45 British American Tobacco p.l.c - Notification of transactions of
05/05/201116:40 Intertrading Limited - Revised Trading Statement
05/05/201116:19 Trencor Limited - First quarter update
05/05/201116:18 Sea Kay Holdings Limited - Sale of Silver Falcon (Pty) Limited, Seriso 474
05/05/201116:07SIM/VIL - Simmer & Jack Mines Limited/Village Main Reef Limited - Update on
05/05/201115:37 Consolidated Infrastructure - Update in respect of the consolidation of
05/05/201115:30 Lewis Group Limited - Trading Statement
05/05/201115:00 Wesizwe - Results of the Annual General Meeting
05/05/201114:44 Trading of Exxaro ordinary shares
05/05/201114:10CCO - Capital & Counties Properties Plc - Results of Placing
05/05/201113:36SCIB/SBR003 - The Standard Bank Of South Africa Limited - Interest Rate
05/05/201112:18EXT - Extract Resources Limited - Update regarding possible offer for Kalahari
05/05/201112:00MND/MNP - Mondi Limited and Mondi plc - Annual general meetings
05/05/201112:00CLRP - Clover Industries Limited - Dealing in securities by director
05/05/201111:46CUL/CULP - Cullinan Holdings Limited - Unreviewed condensed consolidated
05/05/201111:00SCIB - Standard bank of South African Limited - Notice of rollover of
05/05/201110:43 Ingenuity Property Investments Limited - Announcement regarding the
05/05/201110:30 AECI - No Change Statement and Notice of Annual General Meeting
05/05/201110:22UCS - UCS Group Limited - Finalisation announcement regarding the dates and
05/05/201110:22 Business Connexion Group Limited - Fulfilment of conditions precedent
05/05/201109:51SCIB - The Standard Bank of South Africa Limited - Issue of share instalments
05/05/201109:50RES - Resource Generation Limited - Change of Director`s Interest Notice
05/05/201109:49 Resource Generation Limited - Notice of initial substantial holder
05/05/201109:48 Resgen - Change of Director`s Interest Notice
05/05/201109:30 African Oxygen Limited - Quarterly Results of Linde AG
05/05/201108:33 BRC DiamondCore - BRC Diamondcore announces Financing
05/05/201108:32 Wesizwe Platinum Limited - Total financing solution for the
05/05/201108:07 Lonrho - Lonrho reports 37% Growth in revenue in Q2 and Profit
05/05/201108:01CCO - Capital & Counties Properties PLC - Placing to fund acquisition
05/05/201108:01 Harmony - Press release: Harmony continues to drive its growth strategy
05/05/201108:00CCO - Capital & Counties Properties Plc - Interim Management Statement for the
05/05/201108:00MND/MNP - Mondi - Interim Management Statement
05/05/201108:00 Harmony - Results for the third quarter and nine months ended 31 March
05/05/201108:00 African Eagle Resources plc - Director Appointment
05/05/201108:00 Metair Investments Limited - Announcement to shareholders
05/05/201107:21 BHP Billiton plc - Transaction in shares
05/05/201107:05WWR/ GDO - White Water Resources/ Gold One - Finalisation data relating to the

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