Thursday, 30 June 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
Lies, Damned Lies, and Statistics For regular investment news and opinion pieces follow Seed Investments on Facebook by ‘Liking’ our Page. Click here to view our page.
The investment world is a complicated environment. It is filled with professionals who have dedicated many years of their lives looking at and analysing numbers. While these professionals are able to analyse these numbers to come to conclusions, explaining the reasoning to someone who isn’t as versed in number crunching can prove quite difficult.
As such there are numerous ratios and statistics that have been developed over the years to help investors reach conclusions from reams of data (read numbers - returns). Unfortunately incorrect conclusions are sometimes inferred from these statistics, which leads to poor decision making.
Today we’ll take a look at the difference between correlation and return profile. Often investors assume that assets with a high correlation will have a similar return profile and vice versa. While this can happen, it’s not always the case!
Below is a chart of the performance of the ALSI and Gold (both in ZAR) over the past 10 years. It is evident that their returns are almost identical, their monthly correlation, however, is only 5%!
You will notice that although gold and ALSI often move in different directions over the past 10 years they have both delivered excellent real returns.
The next two charts compare the MSCI World with the MSCI Emerging Market. The first chart is one that we often see, with the MSCI Emerging Market thoroughly outperforming the MSCI World. With this type of return profile most investors would assume they have a low correlation, but this couldn’t be further from the truth! Over the past 10 years there has been a correlation of over 90% between these two indices. Having a look at the second chart of the two we can see why this case. Here we’ve put the two indices on different axes and we can see that the direction of their returns are very similar (what correlation measures), but the final result is very different.
An important point is that correlation is not necessarily the same as return profile, and extending this further is to be wary of any conclusions drawn from methods that you don’t understand.
While correlation is a tool that we look at in an attempt to smooth returns, we believe that it is more important to get a variety of return drivers together when constructing a portfolio. In many cases assets with different returns drivers will have a low correlation, but you won’t find us excluding assets purely because they have a high correlation.
The investor who excluded emerging market assets from his portfolio over the last decade on the basis of them having a high correlation with developed markets wouldn’t be a happy investor!
Take care,
Mike Browne
info@seedinvestments.co.za
www.seedinvestments.co.za
021 9144 966
Thu, 30 Jun 2011
Top News
South African stocks rose for a fourth straight day on Thursday, tracking global equities higher after Greece took further steps to avert a default, and ending a turbulent second quarter on a positive note. Full story
Nigeria's planned adoption of international accounting standards next year should boost foreign investment and valuations for the best-managed companies, analysts said. Full story |
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The Greek parliament passed a second austerity bill on Thursday, opening the way for the EU and IMF to release a 12 billion euro (10.8 billion pound) loan instalment which Athens urgently needs to stave off bankruptcy. Full storyRussia accused France on Thursday of committing a "crude violation" of a U.N. weapons embargo by arming Libyan rebels, a stance which could also cause unease within the Western alliance bombing to remove Muammar Gaddafi. Full storyA U.N.-backed tribunal seeking the killers of statesman Rafik al-Hariri handed indictments and arrest warrants to Lebanon on Thursday that officials said accused members of the militant Hezbollah group of involvement. Full story |
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Markets | Wall Street rose for a fourth
consecutive session on Thursday in an end-of-quarter rally that
was boosted by a surprisingly strong economic report. . . Full story | | European shares hit their highest
level in almost four weeks on Thursday after Greece's parliament
passed a final vote on austerity measures, boosting. . . Full story | | World stocks rose to their
highest level in month and the euro surged on Thursday as
Greece approved the final austerity measures needed. . . Full story | | Britain's top shares rose
sharply on Thursday after the Greek parliament passed a second
austerity bill to secure emergency funds, with riskier assets
such. . . Full story |
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| World stocks and the euro hit
three-week highs on Thursday after Greece took a step closer to
avoiding a default in the short. . . Full story | | Australian shares jumped 1.7
percent on Thursday, the biggest one-day percentage gain in
seven months, as top banks and large miners jumped in. . . Full story | | The Nikkei average ended slightly
higher on Thursday though it pulled back after hitting a fresh
seven-week peak, partly encouraged by strong. . . Full story | | Hong Kong shares were set to
recover on Thursday following a bounce in overseas markets
prompted by a return to risky assets after. . . Full story |
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SA Business | South Africa's trade deficit narrowed to 1.0 billion rand in May -- in line with forecasts -- from a 2.4 billion. . . Full story | | The possibility of a systematic banking crisis emanating from Europe cannot be dismissed, South African Reserve Bank Governor Gill Marcus said. . . Full story | | | | Growth in credit demand by South Africa's private sector slowed to 5.18 percent year-on-year in May compared with a slightly downward. . . Full story |
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| South African banks may face big hurdles to meet new Basel III global banking regulations.. . . Full story | | South African banks may
face big hurdles to meet new Basel III global banking
regulations.. . . Full story | | Rates for panamax dry bulk
carriers on key Asian freight routes are expected to fall next
week on limited Chinese coal demand and. . . Full story | | Gold rose on Wednesday after
the Greek parliament approved debt austerity measures, that
fueled investor appetite for commodities and other riskier
assets and boosted. . . Full story |
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| South Africa's rand gained slightly on Wednesday while yields on government debt climbed in a volatile session driven by global markets.. . . Full story |
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Company News | At the annual general meeting of Trencor held today, all the ordinary and special resolutions proposed at the meeting were approved. . . Full story | | BCX and UCS shareholders are referred to the announcements released by each of the companies on SENS of the JSE Ltd. . . Full story | | Further to Keaton Energy's preliminary summarised audited group results for the year ended 31 March 2011, published on SENS on 22. . . Full story | | Further to the announcement made on 10 September 2010 titled "Possible conversion of further furnaces at Machadodorp Works"; ARM and Assore. . . Full story |
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| Blue shareholders are referred to the trading update released on the SENS on 28 June 2011, and were advised that the. . . Full story | | Further to Acucap's audited group results for the year ended 31 March 2011, released on SENS on 9 June 2011, the. . . Full story | | Shareholders are advised that the company's annual report, incorporating the audited financial statements for the year ended 31 March 2011, was. . . Full story | | Shareholders were advised that the company expects that the loss per share for the twelve months ended 28 February 2011 will. . . Full story |
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Company Results | Revenue for the six months ended 31 May 2011 went up by 26% to R1.4 billion (2010: R1.1 billion) and gross. . . Full story | | Revenue for the year ended 31 March 2011 increased to R142.8 million (2010: R139.9 million). Gross profit decreased to R63.3 million. . . Full story | | Revenue rose to R557.6 million (R353.9 million). Gross profit more than halved to R25.7 million (R58.5 million) and a loss from. . . Full story | | Kibo Mining plc the mineral exploration and development company focused on gold and nickel projects in Tanzania, announce its maiden unaudited. . . Full story |
World Markets (Spot Prices)
Name | Time | RP | Move | % Move | JSE Overall | 17:05 | 31864.54 | 138.24 | 0.44% | JSE Top 40 | 17:05 | 28551.82 | 123.10 | 0.43% | JSE Gold | 17:00 | 2382.17 | -15.98 | -0.67% | JSE Financial | 17:05 | 21565.71 | 63.19 | 0.29% | JSE Industrial | 17:00 | 33034.05 | 192.92 | 0.59% | JSE Indust 25 | 17:00 | 27749.40 | 171.40 | 0.62% | JSE Resource | 17:00 | 53932.54 | 203.88 | 0.38% | DJ Futures | 19:40 | 12315.00 | 104.00 | 0.85% | DJ Ind | 19:31 | 12384.06 | 122.64 | 1.00% | SP 500 | 20:00 | 1318.63 | 11.22 | 0.86% | Nasdaq | 20:00 | 2770.78 | 30.29 | 1.11% | FTSE 100 | 17:35 | 5945.71 | 89.76 | 1.53% | DAX | 18:00 | 7376.24 | 82.10 | 1.13% | CAC40 | 17:46 | 3982.21 | 57.98 | 1.48% | Nikkei | 08:26 | 9816.09 | 167.11 | 1.73% | Shanghai | 12:22 | 2762.08 | 33.60 | 1.23% | Hang-Seng | 10:32 | 22398.10 | 336.32 | 1.52% | All Ords | 09:33 | 4659.80 | 80.00 | 1.75% | NZSE 50 | 07:26 | 3448.35 | 7.34 | 0.21% |
| | Name | Time | RP | Move | % Move | Gold | 19:59 | 1501.13 | -10.29 | -0.68% | Gold/Rand | 20:00 | 10150.19 | -115.88 | -1.13% | Gold/R kg | 20:00 | 326329 | -2032 | -0.62% | Silver | 19:59 | 34.5480 | -.2770 | -0.80% | Platinum | 19:53 | 1720.25 | .55 | 0.03% | Palladium | 19:58 | 756.50 | 9.50 | 1.27% | R157 | 17:00 | 7.50 | .01 | 0.13% | R204 | 17:00 | 8.30 | .01 | 0.06% | Brent Crude | 19:56 | 112.08 | .12 | 0.11% | Rand / Dollar | 19:59 | 6.7617 | -0.0292 | -0.43% | Rand / Pound | 19:59 | 10.8363 | -0.0568 | -0.52% | Rand / Euro | 19:59 | 9.8167 | -0.0028 | -0.03% | Rand / NZD | 19:58 | 5.5923 | -0.0121 | -0.22% | Rand / AUD | 19:59 | 7.2498 | -0.0153 | -0.21% | Yen / Dollar | 19:58 | 80.5900 | -0.1900 | -0.24% | Euro / Dollar | 19:59 | 0.6885 | -0.0040 | -0.58% | Dollar / Euro | 19:59 | 1.4517 | 0.0085 | 0.59% | Pound / Dollar | 19:59 | 0.6219 | -0.0004 | -0.06% |
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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 |
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30/06/2011 | 236 | 116 | 73 | 425 | 370,600,712 | R13,768,593,101 | 104596 | 1645309 | 29/06/2011 | 235 | 102 | 78 | 415 | 275,539,044 | R12,480,755,484 | 97455 | 1675558 | 28/06/2011 | 234 | 86 | 74 | 394 | 268,579,526 | R11,882,121,405 | 96798 | 1757624 | 27/06/2011 | 159 | 169 | 78 | 406 | 243,185,782 | R11,483,560,630 | 86968 | 1579010 | 24/06/2011 | 220 | 108 | 69 | 397 | 276,851,828 | R14,165,604,557 | 106252 | 1990628 |
Index Summary Index Name | RP | Move | % Move | Top 40 | 28,551.82 | 123.10 | 0.43% | Industrial | 33,034.05 | 192.92 | 0.59% | Mid Cap | 42,170.15 | 182.52 | 0.43% | Small Cap | 32,151.52 | 175.25 | 0.55% | Resource 20 | 53,932.54 | 203.88 | 0.38% | Industrial 25 | 27,749.40 | 171.40 | 0.62% | Financial 15 | 8,128.26 | 26.48 | 0.33% | Financial & Ind. 30 | 30,834.03 | 154.38 | 0.50% | All Share | 31,864.54 | 138.24 | 0.44% | Oil & Gas | 26,953.81 | 225.69 | 0.84% | Mining | 35,376.66 | 93.31 | 0.26% | Gold Mining | 2,382.17 | -15.98 | -0.67% | Platinum Mining | 69.54 | -.38 | -0.54% | Oil & Gas Producers | 14,492.57 | 121.35 | 0.84% | Basic Materials | 29,993.47 | 95.51 | 0.32% | Chemicals | 13,868.00 | 207.26 | 1.52% | Forestry & Paper | 14,538.40 | 159.90 | 1.11% | Industrial Metals | 29,918.25 | 166.65 | 0.56% | Industrials | 28,045.22 | 54.42 | 0.19% | General Industrials | 76,270.71 | 169.91 | 0.22% | Consumer Goods | 27,327.00 | 36.12 | 0.13% | Automobiles & Parts | 3,441.98 | 45.29 | 1.33% | Household Goods | 146.11 | 2 | 1.06% | Health Care | 33,340.56 | 30.13 | 0.09% | Beverages | 83.72 | .67 | 0.81% | Food Producers | 47,746.10 | 152.12 | 0.32% |
| | Index Name | RP | Move | % Move | Personal Goods | 440.15 | -4.20 | -0.95% | Consumer Services | 53,528.23 | 697.80 | 1.32% | General Retailers | 41,831.06 | 617.49 | 1.50% | Travel & Leisure | 3,741.30 | 7.26 | 0.19% | Media | 84.22 | 1.37 | 1.65% | Support Services | 2,442.25 | 8.37 | 0.34% | Telecommunications | 69,764.12 | 612.31 | 0.89% | Financials | 21,565.71 | 63.19 | 0.29% | Banks | 40,253.85 | 90.05 | 0.22% | Non-life Insurance | 31,766.31 | .00 | 0.00% | Life Insurance | 15,878.91 | 72.11 | 0.46% | General Financial | 2,266.77 | 14.52 | 0.64% | Technology | 21,825.24 | 190.99 | 0.88% | SHARIAH TOP40 | 3,154.77 | 13 | 0.41% | FTSE/JSE SHARIAH ALL | 3,218.10 | 13 | 0.40% | COAL MINING | 23,608.37 | 224 | 0.96% | FTSE JSE Fledgling | 4,554.14 | 50 | 1.11% | FTSE/JSE Alt X | 1,069.65 | -0 | -0.05% | SA LISTED PROPERTY | 381.55 | | -0.20% | CAPPED PROPERTY | 316.83 | | -0.16% | RESOURCE | 29,751.65 | 101 | 0.34% | DIVIDEND PLUS | 167.73 | 1 | 0.55% | FTSE/JSE RAFI 40 | 6,647.23 | 31 | 0.48% | Capped Top 40 | 14,892.37 | 63 | 0.42% | Capped All Share | 16,053.52 | 70 | 0.44% |
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Click here for the Sharenet Index Summary page
Latest Consensus Changes** Code | Company Name | Status | Updated | NED | NEDBANK GROUP LTD | SELL | 28 Jun | SBK | STANDARD BANK GROUP LIMIT... | SELL | 28 Jun | AIP | ADCOCK INGRAM HLGS LD | HOLD | 28 Jun | LHC | LIFE HEALTHCARE GRP HLDG ... | BUY | 28 Jun | EQS | EQSTRA HOLDINGS LTD | HOLD | 28 Jun |
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Results Expected** Expected | Company Name | Fin. Date | 01 Jul 2011 | AH-VEST | March 2011 (Final) | 01 Jul 2011 | BEIGE | March 2011 (Final) | 01 Jul 2011 | BEIGEP | March 2011 (Final) | 01 Jul 2011 | BEIGEPREF2 | March 2011 (Final) |
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Recent Dividends** Share Name | Dec-Date | LDT | Pay-Date | Amount | HUDACO | 11-06-29 | 11-08-12 | 11-08-22 | R 1.3000 | AMECOR | 11-06-29 | 11-07-15 | 11-07-25 | R 0.0800 | PRIMESERV | 11-06-29 | 11-07-15 | 11-07-25 | R 0.0250 | TRUSTCO | 11-06-28 | 11-07-15 | 11-08-12 | R 0.0200 | NASPERS-N | 11-06-27 | 11-09-16 | 11-09-26 | R 2.7000 |
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Ex Div** Share Name | Dec-Date | LDT | Pay-Date | Amount | TIGBRANDS | 11-05-30 | 11-06-24 | 11-07-04 | R 2.8100 | VODACOM | 11-05-16 | 11-06-24 | 11-07-04 | R 2.8000 | ACUCAP | 11-06-09 | 11-06-24 | 11-07-04 | R 1.3888 | ALTRON PP | 11-05-04 | 11-06-24 | 11-07-04 | R 1.0800 | ALTRON | 11-05-04 | 11-06-24 | 11-07-04 | R 1.0800 |
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Upcoming AGMs** Code | Company Name | Date | Status | MZR | Mazor Group Ltd | 30/06/2011 | Confirmed | TED2 | Trencor Ltd | 30/06/2011 | Confirmed | TRE | Trencor Ltd | 30/06/2011 | Confirmed | MOB | Mobile Industries Ltd | 30/06/2011 | Confirmed | RBA | RBA Holdings Ltd | 30/06/2011 | Confirmed |
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