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Thursday, 19 May 2011 - 20:00
Sharenet is pleased to announce the launch of our new publication, The Sharenet Daily. We have built on the success of our Daily Equity Report, while adding more content and helpful information. The result is a publication that gives readers a quick, easy to read and informative synopsis of market activity, company results and news on the JSE for the day, as well as an overview of what transpired on important overseas markets.The Sharenet Daily includes helpful charts that give a graphical impression of events, and our news content is sourced from a number of contributors, including Reuters. In addition, Sharenet's popular price information is available in our Spot Price format which provides a snapshot of the JSE and world indices, currencies and commodities.
All the JSE trading statistics; major movers; latest dividends; upcoming AGM dates and more are provided to insure that you keep abreast of market developments. The Sharenet Daily is published at 8pm each day on the website and also distributed via email for your convenience. As always, we welcome your comments, feedback and suggestions at support@sharenet.co.za
Charts
Investing in ETFs
There is a fair amount of literature out there that recommends that investors should rather invest into ETFs (Exchange Traded Funds) than actively managed funds. The theory is that active equity managers in general fail to beat their benchmarks and that ETFs, as the low cost option, will therefore outperform. While we agree with this theory, we disagree that investors should blindly allocate their investments to ETFs.
While the cost of ETFs in most developed markets is extremely low, the costs of ETF unit trusts in South Africa, in general, are comparable with many of the actively managed equity unit trusts. Investors investing through listed ETFs need to incur buy and sell spreads on purchasing and selling the ETFs (while most unit trusts don’t have initial or exit fees anymore) and also monthly fees for their stockbroker accounts. It only becomes feasible to use the listed option when you have a fairly sizable asset base. Purely from a cost basis we can see in the chart below that even over a fairly short period (just over 5 years) the ETF unit trust underperforms the index by 10%.
Our second issue with advising uneducated investors to allocate their investments to ETFs is the fact that there are many ETFs that investors need to choose between. It isn’t merely a passive decision anymore, but rather an active choice as to which index the investor wants to get exposure to. Below we have shown the difference between two indices and their respective ETFs over the past 5 years or so. Evidently the investor choosing the Indi Fund would be significantly happier than the Fini Fund investor.
We do feel that there is a place for ETFs in the investment landscape but, just like any investment product, the investor needs to ensure that they (or a trusted advisor) understand what they are invested into.
At Seed we do make selective use of ETFs in our investment portfolios. Key for us is to understand what the ETF is tracking, what the return drivers are, what role the ETF plays in the investment portfolio, and what the alternatives (if any) are.
If you have an opinion about the usage of ETFs in investment portfolios, click through to Seed’s Facebook Fan Page and have your say under this posted note.
Take care,
Mike Browne
info@seedinvestments.co.za
www.seedinvestments.co.za
021 9144 966
Top News
![[IMAGE]](image.php@width=300&height=150&cropratio=2%253A1&image=%252Fnewsimages%252F2011-05-19T164808Z_01_AJOE74I1AOB00_RTROPTP_3_OZABS-SAFRICA-BONDS-20110519.JPG "A BANK TELLER LOOKS AT 50 AND 100 SOUTH AFRICAN RAND NOTES.") South African government bonds extended gains and yields fell to a 1-1/2 week low on Thursday as benign inflation data dented prospects of domestic interest rates rising earlier than expected. Full story ![[IMAGE]](image.php@width=300&height=150&cropratio=2%253A1&image=%252Fnewsimages%252F2011-05-19T103437Z_01_AJOE74I0TDQ00_RTROPTP_3_OZABS-GOLDFIELDS-20110519.JPG "A Gold Fields Mine company logo is seen outside the South Deep Gold mine") Gold Fields maintained its bullion output target for 2011 and said it was confident gold would stay near current prices as it posted first-quarter earnings just below market expectations. Full story |
 French Finance Minister Christine Lagarde emerged as frontrunner on Thursday to succeed Dominique Strauss-Kahn as head of the IMF after he resigned and vowed to fight charges of sexually assaulting a hotel maid. Full story  Syrian troops backed by tanks deployed in a border village on Thursday, witnesses said, ignoring growing pressure from Washington, which has imposed sanctions on President Bashar al-Assad for rights abuses. Full story  Three bombs targeting Iraqi security forces exploded near government buildings in the centre of Iraq's disputed northern oil city of Kirkuk Thursday, killing 27 people and injuring scores, health authorities said. Full story |
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Markets |
Discouraging U.S. housing and
factory data weighed on oil and other commodity prices on
Thursday while a lackluster day on Wall Street was. . . Full story |
European shares rose in a broad
market rally on Thursday but ended off their highs after mixed
U.S. economic data, and some strategists. . . Full story |
Energy and banking stocks
propelled Britain's FTSE 100 higher on Thursday as commodities
trading giant Glencore made its London Stock Exchange debut.. . . Full story |
Gold fell on Thursday as the euro
edged up against the dollar and oil prices firmed, but prices
were still set for a. . . Full story | |||
Wall Street stocks were set
for a higher open on Thursday after weekly jobless claims data
suggested the labor market was on track. . . Full story |
European shares rose on Thursday,
led by commodity stocks after the initial public offering of
Glencore helped sentiment in the sector, but ongoing. . . Full story |
Australian stocks rose 1.3
percent on Thursday to a 5-day high, driven up by heavyweight
miners, banks and energy companies as commodity prices. . . Full story |
The Nikkei average slipped on
Thursday as Tokyo Electric tumbled, dragging down other
utilities after the government's chief spokesman said its
shareholders will be. . . Full story | ||||
SA Business |
South African power utility Eskom said on Thursday it would auction up to 400 million rand of its ES23 bond on. . . Full story |
South Africa's maize futures recorded sharp gains on Thursday, in line with higher prices on the Chicago Board of Trade (CBOT),. . . Full story |
South African investment bank and asset manager Investec Ltd posted a surprise 5 percent decline in full-year profit, hit by a. . . Full story |
A looming power crunch in South Africa is likely to push global platinum prices higher by increasing costs for miners and. . . Full story | |||
Dominique Strauss-Kahn has resigned as head of the International Monetary Fund after his arrest at the weekend on charges he sexually. . . Full story | The "long-term play" mantra
that accompanies equity investing in frontier Africa is wearing
decidedly thin.. . . Full story | Dominique Strauss-Kahn has resigned as
head of the International Monetary Fund after his arrest at the
weekend on charges he sexually assaulted a. . . Full story | South Africa needs to start the international procurement for its planned nuclear plants early next year so it can build the. . . Full story |
Swaziland, one of Africa's
poorest countries and its last absolute monarchy, is near
financial collapse, with a budget deficit of 14.3 percent of GDP
and rapidly dwindling foreign reserves, the IMF said.. . . Full story | South Africa's Investec may need to raise as much as 75 million pounds in new capital to meet up-coming UK banking regulations, the lender's managing director told Reuters.. . . Full story |
Company News |
Further to the detailed terms announcement released on the Securities Exchange News Service of the JSE Ltd ("JSE") on 21 April. . . Full story |
ARM would like to provide clarification on recent media coverage reporting on the performance of the Kenya Stock Exchange which has. . . Full story |
Discovery announced that it is set to revolutionise SA's short-term insurance market. Highlights include:
* Discovery leverages Vitality, its proven behavioural economics. . . Full story |
Resgen has received strong interest from financiers following a process to secure debt funding for the construction of its Boikarabelo mine. . . Full story | |||
AngloPlat announced the appointment of Albertinah Kekana as an independent non-executive director, effective 1st July 2011. Her appointment brings the total number of independent non-executive directors on the AngloPlat board to. . . Full story |
Since the last company announcement dated 29 March 2011, the company together with other industry stakeholders have held four meetings with the South African Department of Water Affairs ("DWA"). The purpose. . . Full story |
Shareholders were advised that PSV is currently finalising its results for the year ended 28 February 2011 and anticipates that the group will reflect a basic loss per share of between. . . Full story | |||||
Company Results | Sales. . . Full story | Revenue increased to R243.5 million (R211.5 million). Gross profit rose to R70.1 million (R62.3 million). Net attributable profit declined to R29.1. . . Full story | Revenue increased to USD19.4 billion (USD18 billion) while operating profit rose to USD3.1 billion (USD2.6 billion).Profit attributable to equity shareholders. . . Full story | k. . . Full story |
World Markets (Spot Prices)
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Click here for the Sharenet Spot Price page
The JSE Today
Trading Statistics| Date | Adv. | Decl. | Unch. | Actives | Volume | Value | Trades | Orders |
|---|---|---|---|---|---|---|---|---|
| 19/05/2011 | 193 | 127 | 90 | 410 | 262,007,068 | R11,069,387,714 | 87617 | 1985181 |
| 17/05/2011 | 127 | 213 | 75 | 415 | 313,772,839 | R13,420,246,840 | 104943 | 2189249 |
| 16/05/2011 | 154 | 162 | 83 | 399 | 240,222,858 | R10,809,816,699 | 88615 | 2006548 |
| 13/05/2011 | 233 | 109 | 82 | 424 | 272,874,593 | R11,830,088,101 | 91675 | 1964298 |
| 12/05/2011 | 83 | 236 | 79 | 398 | 264,465,126 | R13,048,737,068 | 96422 | 1997646 |
Major Moves Up
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Major Moves Down
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New Highs
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New Lows
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Index Summary
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Click here for the Sharenet Index Summary page
Latest Consensus Changes**
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Results Expected**
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Recent Dividends**
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Ex Div**
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Upcoming AGMs**
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Stock Exchange News Service
| Date | Time | Headline |
| 19/05/2011 | 17:40 | Thabex Limited - Summarised audited results for the year ended 28 February |
| 19/05/2011 | 17:25 | Resilient Property Income Fund Limited - Dealing in securities |
| 19/05/2011 | 17:07 | 1time holdings Limited - Dealings in securities by a director of a major |
| 19/05/2011 | 16:55 | Exxaro Resources Limited - Trading of Exxaro ordinary shares on behalf of |
| 19/05/2011 | 16:37 | The Bidvest Group Limited - Directors` dealings in securities |
| 19/05/2011 | 16:25 | Old Mutual Plc - Form 8.3 |
| 19/05/2011 | 16:22 | Iliad Africa Limited - Results of Annual General Meeting |
| 19/05/2011 | 15:54 | Hosken Consolidated Investments - Reviewed consolidated results for the |
| 19/05/2011 | 15:30 | Old Mutual plc - Total voting rights and shares in issue |
| 19/05/2011 | 15:15 | African Oxygen Limited - Results of Annual General Meeting |
| 19/05/2011 | 15:14 | Sentula Mining Limited - Posting of the circular to shareholders in |
| 19/05/2011 | 15:01 | Gold Reef - Change in directorate |
| 19/05/2011 | 15:00 | Gold Reef Resorts Limited - Reviewed consolidated financial results for |
| 19/05/2011 | 14:59 | GEN - FTSE/JSE Africa Index Series - Wesizwe Platinum (South Africa): Shares in |
| 19/05/2011 | 14:31 | Metmar Limited - Audited abridged financial results for the year ended |
| 19/05/2011 | 14:30 | MAS PLC - Notice of final dividend |
| 19/05/2011 | 14:29 | Sappi - Sappi Fine Paper Europe announces cessation of coated graphic |
| 19/05/2011 | 13:56 | W G Wearne Limited - Trading Statement |
| 19/05/2011 | 13:43 | African Rainbow Minerals Limited - Clarification on recent media |
| 19/05/2011 | 11:50 | Mercantile Bank Holdings Limited - Company Announcement |
| 19/05/2011 | 11:42 | Discovery Holdings Limited - Discovery set to revolutionise SA Short- |
| 19/05/2011 | 11:35 | New Europe Property Investments plc - Update regarding NEPI`S prospective |
| 19/05/2011 | 11:32 | IQuad Group Limited - Dealing in securities |
| 19/05/2011 | 11:30 | Resource Generation Limited - Update on debt funding |
| 19/05/2011 | 11:24 | Gold One International Limited - Results of Gold One 2011 annual general |
| 19/05/2011 | 10:47 | SCIB/PPCSTF - The Standard Bank of South Africa Limited - Dividend announcement |
| 19/05/2011 | 10:46 | SCIB - The Standard Bank of South Africa Limited - Issue of stock warrants |
| 19/05/2011 | 10:32 | Country Bird Holdings Limited - Dealings in securities |
| 19/05/2011 | 10:07 | Resilient Property Income Fund Limited - Change to the board of directors, |
| 19/05/2011 | 09:48 | Brikor - Renewal of Cautionary Announcement regarding Disposals |
| 19/05/2011 | 09:39 | Anglo American Platinum Limited - Change to the board of directors |
| 19/05/2011 | 09:20 | Metmar - Correction to Trading Statement |
| 19/05/2011 | 09:10 | O-line Holdings Limited - Notification of Share Dealing by O-line |
| 19/05/2011 | 09:01 | INLP - Investec Bank Limited - Reviewed preliminary condensed consolidated |
| 19/05/2011 | 09:00 | INP/INL - Investec plc/Investec Limited - Unaudited combined consolidated |
| 19/05/2011 | 08:43 | O-line Holdings Limited - Notification of Share Dealing by Directors |
| 19/05/2011 | 08:05 | SABMiller Plc - SABMiller plc announces the appointment of two new non- |
| 19/05/2011 | 08:00 | SABMiller Plc - Preliminary Announcement |
| 19/05/2011 | 08:00 | Infrasors - Reviewed Condensed Group Consolidated Results for the year |
| 19/05/2011 | 08:00 | Gold Fields Limited - Costs contained despite seasonal decline in |
| 19/05/2011 | 08:00 | Central Rand Gold Limited - Interim Management Statement |
| 19/05/2011 | 07:32 | Compagnie Financiere Richemont SA Depositary Receipts - Richemont |
| 19/05/2011 | 07:31 | Compagnie Financiere Richemont SA Depositary Receipts - Richemont |
| 19/05/2011 | 07:30 | Compagnie Financiere Richemont SA Depositary Receipts - Richemont, the |
| 19/05/2011 | 07:15 | Anglo American plc - Treasury Shares - Transfers |
| 19/05/2011 | 07:12 | British American Tobacco p.l.c - Transaction in own shares |
| 19/05/2011 | 07:11 | British American Tobacco p.l.c - Notification of transactions by |
| 19/05/2011 | 07:10 | British American Tobacco p.l.c - Transaction in own shares |
| 19/05/2011 | 07:06 | BHP Billiton Plc - Transaction in shares |
| 19/05/2011 | 07:05 | Oando PLC - Oando earnings forecast for the second quarter ending |
| 19/05/2011 | 07:05 | BHP Billiton Plc - Transaction in shares |
| 19/05/2011 | 07:05 | Old Mutual plc - Form 8.3 |
| 19/05/2011 | 07:05 | CCO - Capital & Counties Properties PLC - Notification of major interests in |
| 19/05/2011 | 07:05 | PSV Holdings Limited - Trading Update |
Click here for more SENS news