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 The Sharenet Daily 
Tuesday, 28 February 2012 - 20:00
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)

Hedge funds - The Alternative Asset Class

In the minds of most investors the word hedge fund doesn’t inspire confidence. Hedge funds unfortunately have a bad reputation, which is mostly due to the sensational headlines that get published about some of the offshore funds that went bust. The news stream is one way as legislation prohibits hedge funds from marketing themselves in South Africa.

South Africa’s first hedge fund was started in 1998 due to demand from institutional pension funds that wanted an asset class that would be able to provide a stable cash plus return that wasn’t highly correlated with the markets. This is still the overall objective of most of the SA based hedge funds.

Hedge funds have a few additional tools available that long only and unit trust managers don’t have. Hedge fund managers are able to short instruments (sell assets they’ve borrowed) and use leverage (invest more than R100 for each R100 contributed). If a manager believes that the share will increase in value he will buy it, and sell it when he believes that the share has reached its fair value. If the manager believes that a share is overpriced he will short it, i.e. he will borrow the share and then sell it. After the share has gone down in value he will buy it back at the lower price and return it to the institution that he borrowed it from at a profit. If the share price goes up he’ll make a loss.

The graph below shows how the same fund manager was able to unlock additional returns by correctly deploying these tools.

The blue line shows the cumulative return of a unit trust and the red line the cumulative return of a hedge fund managed by the same manager. The funds have the same investment strategy and process, with the major difference being that the manager is able to make use of shorting and leveraging in the hedge fund.

As with unit trusts you get different types of hedge funds. The three main strategies employed are Long Short, Market Neutral, and Fixed Income. Long Short funds try to profit by buying companies that they like and shorting those that they don’t. Market Neutral funds aim to remove the market risk from funds, by pairing long and short positions. Fixed Income funds make use of fixed income instrument like bonds, interest rate swaps, interest rate futures, etc.

The table below shows how hedge fund returns compare to other indices. The returns of this hedge fund index are compiled by a local asset manager of hedge funds that partake in their monthly survey. The returns are cumulative until the end of January 2012.

The hedge fund strategies might not outperform the ALSI over all periods, but are more consistent in their returns. From the graph below you can see that over a 5 year period hedge funds were able to provide comparable returns to the ALSI at a much lower risk levels.

There are some drawbacks to hedge funds. Hedge funds are not FSB approved, but hedge fund managers must have an FSB Category IIB license to manage a hedge fund. The fund managers try to overcome this hurdle by providing transparency in their dealings, independent custodians, administrators, and compliance. The entry point for hedge funds is higher than unit trusts as the minimum investment is generally R1m. Most hedge funds trade on a monthly basis and might have notice periods for disinvestments.

Hedge funds aren’t suitable for every investor, but can provide an excellent building block in your asset allocation. Hedge funds are not highly correlated with other assets. They provide more stable returns than most asset classes and are able to provide some capital protection in bear markets.

Kind regards,

Gerbrandt Kruger
021 9144 966

Tue, 28 Feb 2012
Top News
Impala Platinum, the world's second-largest platinum producer, said on Tuesday the costs of an illegal strike at its key Rustenburg operation in South Africa have reached 100,000 ounces and a loss of income of 2 billion rand.  Full story

South African stocks rose on Tuesday, reversing the previous session's slump as strong results from FirstRand lifted other financials and a fall in the oil price boosted global shares and domestic miners.  Full story
A British photographer wounded in a Syrian army bombardment of Homs was smuggled safely into neighbouring Lebanon on Tuesday, but the fate of other journalists trapped with him was unclear.  Full story
The young Japanese woman clutches a beige blanket tight around her shoulders as she stares into the distance. Behind her hulks twisted metal and splintered wood left by the tsunami that devastated Ishinomaki, her hometown.  Full story
Sonia Gandhi, the head of India's ruling Congress party, has travelled abroad for routine medical checks six months after undergoing surgery in the United States, a spokesman for the party said on Tuesday.  Full story
Gold prices rose 1 percent toward $1,800 an ounce on Tuesday on an expected injection of cheap money from the European Central Bank,. . .  Full story
Britain's FTSE 100 crept into positive territory on Tuesday, with miners tracking metal prices higher as the anticipation of cheap European Central Bank loans. . .  Full story
Stocks rose on Tuesday as strong U.S. consumer confidence data lent traction to Wall Street's rally, while the euro climbed ahead of. . .  Full story
European shares edged up on Tuesday as investors braced for the next round of the European Central Bank's (ECB) injection of cheap cash. . .  Full story

U.S. stocks rose on Tuesday on strong U.S. consumer confidence data, but gains were capped after a report showed a drop in. . .  Full story
European shares reversed losses and briefly turned positive again on Tuesday in choppy trading after U.S. consumer confidence readings came in better than expected.. . .  Full story
U.S. stocks opened little changed on Tuesday after a report showing a sharp drop in durable goods orders cut into upbeat sentiment a. . .  Full story
European shares rose on Tuesday on optimism the European Central Bank's (ECB) move to inject cheap cash would help banks manage their balance. . .  Full story
SA Business
Shares of Santam jumped over 4 percent after the South African insurer declared a special dividend and investors shrugged off an. . .  Full story
South Africa's economic growth accelerated more than expected in the fourth quarter of 2011, driven by rising consumer demand caused by. . .  Full story
South Africa plans to allocate more funds towards the construction of nuclear power plants as it aims to boost electricity supply. . .  Full story
Africa-focused miner Petra Diamonds said first half earnings fell as unrealised foreign exchange losses wiped out improved revenues earned from a. . .  Full story

South Africa's maize output is likely to rise by 13 percent this year as higher prices boost plantings of the staple. . .  Full story
South Africa will solicit international bids for 128 billion rand worth of train coaches and locomotives as early as next month,. . .  Full story
FirstRand, South Africa's No.2 bank, reported a 26 percent rise in first-half profit on strong loan growth, and said it would. . .  Full story
South Africa's FirstRand is unlikely to see a further earnings boost from improvements in bad debts, the chief financial officer of. . .  Full story

Impala Platinum, the world's second largest platinum producer, is seeking high-level talks with the Zimbabwean government which on the weekend gave it 2 weeks to surrender a 29.5 percent stake in. . .  Full story
FirstRand would not want to spend more than 10 percent of its capital on new acquisitions, the chief executive of South Africa's second-largest lender said on Tuesday.. . .  Full story
South Africa's rand firmed against the dollar on Tuesday, and looked set to launch another assault on a strong resistance level at 7.52 on the back of higher appetite for riskier. . .  Full story
Company News
Shareholders are advised that the annual report for the year ended 30 September 2011 was dispatched on 28 February 2012 and. . .  Full story
Implats has previously communicated to shareholders about the illegal work stoppage at its Rustenburg mine. The strike has now entered its. . .  Full story
Shareholders are referred to the announcements dated 13 June 2011 and 19 July 2011 regarding the acquisition by AMAP's wholly owned. . .  Full story
Companies are required to publish a trading statement as soon as they are reasonably certain that the financial results for the. . .  Full story

Grindrod Ltd. shareholders are advised that the final results for the twelve months ended 31 December 2011, are expected to be released on 29 February 2012. Grindrod is holding a final. . .  Full story
The board of directors of Stefanutti Stocks announce the appointment Zanele Matlala as an independent non-executive director of the company and as a member of the Audit, Governance and Risk Committee. . .  Full story
According to Business Report, Afgri Poultry has been appointed as supplier to the KFC chicken chain restaurants owned by Yum. Afgri Poultry, the broiler producing and processing arm of Afgri, will. . .  Full story
Company Results
Revenue grew substantially to R9.1 billion (December 2010: R6.9 billion) and gross profit grew to R3.3 billion (December 2010: R2.8 biilion).. . .  Full story
Revenue for the interim period grew by 15.1% to R67.3 million (2010: R58.5 million). Trading profit increased by 14.9% to R3.2. . .  Full story
Revenue increased to R4.8 billion (R4.4 billion) for the six months-ended 31 December 2011. Operating profit grew by 20% to R905. . .  Full story
Revenue for the interim period ended 31 December 2011 increased to R218.6 million (2010: R160.2 million). Operating profit rose to R46.2. . .  Full story
World Markets (Spot Prices)
NameTimeRPMove% Move
JSE Overall17:0234214.53343.211.01%
JSE Top 4017:0030484.34324.071.07%
JSE Gold17:002769.447.510.27%
JSE Financial17:0224560.31274.211.13%
JSE Industrial17:0036704.83302.310.83%
JSE Indust 2517:0030788.02267.110.88%
JSE Resource17:0053796.14650.051.22%
DJ Futures19:5012993.0024.000.19%
DJ Ind19:4513014.3232.810.25%
SP 50020:001372.494.900.36%
FTSE 10017:025924.999.440.16%
All Ords07:424351.20-3.30-0.08%
NZSE 5006:463309.806.350.19%
NameTimeRPMove% Move
Gold/R kg20:0043250524400.57%
Brent Crude19:56123.64-1.83-1.46%
Rand / Dollar19:587.5319-0.0170-0.23%
Rand / Pound19:5511.92330.01030.09%
Rand / Euro19:5510.13020.01780.18%
Rand / NZD19:576.3065-0.0350-0.55%
Rand / AUD19:558.1055-0.0130-0.16%
Yen / Dollar19:5880.51000.02900.04%
Euro / Dollar19:550.7431-0.0032-0.43%
Dollar / Euro19:581.34500.00580.43%
Pound / Dollar19:550.6296-0.0022-0.35%

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The JSE Today

Trading Statistics
* Includes all listed instruments on the JSE
Major Moves Up
SharenameSaleMove% MoveVolume
1 FAIRVEST  120109.09.%15000
2 SANTAM  163009075.89.%100712
3 S-OCEAN  180105.88.%65000
4 ROLFES  371205.70.%93883
5 HUGE  12065.26.%240962
6 PBT  205105.13.%10000
7 HOLDSPORT  40471724.44.%147895
8 EXXARO  207807553.77.%449073
9 JUBILEE  19473.74.%772344
10 INDEQTY  300103.45.%2110
11 COAL  863283.35.%479941
12 GBGOLD  739212.92.%800
13 JDGROUP  49331312.73.%133377
14 ADCORP  2783732.69.%38265
15 AFROX  1910502.69.%670805
16 INVPROP  1150302.68.%145951
17 STEINHOFF  2700692.62.%6112387
18 RMIH  1604382.43.%1589805
19 RBPLAT  61711462.42.%36709
20 BELL  2150502.38.%2850

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Major Moves Down
SharenameSaleMove% MoveVolume
1 BEIGE-PR2  120-27-18.37.%1256
2 HWANGE  340-50-12.82.%190
3 CAPEVIN  9500-500-5.00.%1100
4 ITLTILE  515-25-4.63.%263770
5 WESIZWE  133-6-4.32.%4231756
6 LITHA  322-13-3.88.%1286226
7 ARB  385-15-3.75.%39594
8 AVUSA  1925-74-3.70.%16858
9 MMG  310-10-3.13.%3126
10 MVELASERV  1149-36-3.04.%56559
11 CADIZ  241-7-2.82.%4135
12 VERIMARK  107-3-2.73.%396105
13 CARGO  907-23-2.47.%100
14 O-LINE  125-3-2.34.%313282
15 AMECOR  225-5-2.17.%7580
16 DCENTRIX  460-10-2.13.%15333
17 GROUP-5  2741-59-2.11.%377203
18 AFRO-C  265-5-1.85.%1740
19 DRDGOLD  589-11-1.83.%2551687
20 AQUARIUS  1635-30-1.80.%481566

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New Highs
SharenameSaleHighMove% MoveVolume
1 SANTAM  16300164009075.89.%100712
2 EXXARO  20780207807553.77.%449073
3 STEINHOFF  27002701692.62.%6112387
4 NASPERSN  41000411228802.19.%1000231
5 REMGRO  13182131852822.19.%661762
6 ASSORE  25405261505412.18.%62610
7 GROWPNT  20702089401.97.%4168606
8 ASPEN  10704107041801.71.%466276
9 IMPERIAL  14275144171991.41.%541300
10 RMBH  31683200361.15.%1238672
11 WOOLIES  44004416501.15.%3095652
12 DISCOVERY  48304858350.73.%1207391
13 PPC  3156319360.19.%1341698
14 ABIL  3889394150.13.%3657392
15 CALGRO  4305000.222993
16 PETMIN  3353450.288747
17 AMA  274282-1-0.36.%526775

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New Lows
SharenameSaleLowMove% MoveVolume
1 WESIZWE  133130-6-4.32.%4231756
2 VERIMARK  107100-3-2.73.%396105

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Index Summary
Index NameRPMove% Move
Top 4030,484.34324.071.07%
Mid Cap46,722.99356.560.77%
Small Cap35,093.00126.740.36%
Resource 2053,796.14650.051.22%
Industrial 2530,788.02267.110.88%
Financial 159,335.98105.751.15%
Financial & Ind. 3034,537.42337.320.99%
All Share34,214.53343.211.01%
Oil & Gas 30,379.55289.070.96%
Mining 34,670.10417.291.22%
Gold Mining2,769.447.510.27%
Platinum Mining62.95.620.99%
GENERAL MINING8,667.03123.881.45%
Oil & Gas Producers 16,334.52155.430.96%
Basic Materials 29,544.22353.861.21%
Chemicals 15,285.19161.591.07%
Forestry & Paper 13,853.3818.640.13%
Industrial Metals 32,276.67589.461.86%
Industrials 31,898.91439.961.40%
General Industrials 89,045.141654.101.89%
Consumer Goods 31,539.9161.020.19%
Automobiles & Parts 4,947.84-22.65-0.46%
Household Goods177.4652.63%
Health Care 38,042.67249.350.66%
Beverages 104.44-.81-0.77%
Index NameRPMove% Move
Food Producers 57,212.78645.541.14%
Personal Goods 460.434.991.10%
Consumer Services 62,349.25802.131.30%
General Retailers 51,744.61574.001.12%
Travel & Leisure 3,681.45-4.51-0.12%
Media 89.961.842.09%
Support Services 2,442.8513.110.54%
Telecommunications 66,875.44790.201.20%
Financials 24,560.31274.211.13%
Banks 46,436.64489.301.06%
Non-life Insurance 39,526.022199.395.89%
Life Insurance 19,684.78275.241.42%
General Financial 2,350.8116.290.70%
Technology 27,258.00344.421.28%
SHARIAH TOP40 3,200.31391.24%
FTSE/JSE SHARIAH ALL3,287.36391.20%
COAL MINING27,847.239023.35%
FTSE JSE Fledgling 5,203.07-20-0.38%
FTSE/JSE Alt X 1,359.62251.85%
RESOURCE 29,740.993471.18%
DIVIDEND PLUS196.2421.02%
FTSE/JSE RAFI 407,167.33761.07%
Capped Top 4016,067.261671.05%
Capped All Share17,301.951721.00%
JSE TABACO 4,842.95-12-0.25%

Click here for the Sharenet Index Summary page
Latest Consensus Changes**
CodeCompany NameStatusUpdated
Results Expected**
ExpectedCompany NameFin. Date
29 Feb 2012BRIMST-NDecember 2011 (Final)
29 Feb 2012BRIMSTONDecember 2011 (Final)
29 Feb 2012CAPCODecember 2011 (Final)
29 Feb 2012DELTADecember 2011 (Final)
29 Feb 2012FERRUMDecember 2011 (Interim)

Recent Dividends**
Share NameDec-DateLDTPay-DateAmount
SANTAM12-02-2812-03-1512-03-26R 3.5500
FIRSTRAND12-02-2812-03-1512-03-26R 0.4400
SANTAM12-02-2812-03-1512-03-26R 8.5000
BIDVEST12-02-2712-04-0412-04-16R 2.8000
SUNINT12-02-2712-03-1512-03-26R 0.9000
Ex Div**
Share NameDec-DateLDTPay-DateAmount
PALAMIN12-02-0612-02-2412-03-05R 2.0700
ZURICH SA12-02-0612-02-2412-03-05R 2.0000
RESILIENT12-02-0812-02-2412-03-05R 1.2135
BHPBILL12-02-0812-02-2412-03-22R 0.5500
NEPI12-02-0812-02-2412-03-05R 0.1048

Upcoming AGMs**
CodeCompany NameDateStatus
TFXTop Fix Holdings Ltd.29/02/2012Confirmed
JDHJohn Daniel Holdings Ltd.02/03/2012Confirmed
EOHEOH Holdings Ltd06/03/2012Confirmed

Stock Exchange News Service
28/02/201217:42 Grand Parade Investments Limited - Swap of the GPI SPV Trust and The GPI
28/02/201217:34DIA/DIB - Dipula - No Change Statement and Notice of Annual General Meeting
28/02/201217:25 Pinnacle - Revised Trading Statement
28/02/201217:19 BSI Steel Limited - Dealing in Securities by Directors
28/02/201217:12 Racec Group Limited - No change statement and notice of Annual
28/02/201217:00 Implats - Implats update on Illegal Strike in Rustenburg
28/02/201216:45 Taste Holdings Limited - Directors` dealings in securities
28/02/201216:45 Labat Africa Limited - Appointment of independent non-executive
28/02/201216:43SGA/SGB - Synergy - Proposed Acquisition of Property Portfolio and Renewal Of
28/02/201216:39 Amalgamated Appliance Holdings Limited - Finalisation announcement
28/02/201216:34BIFR1 - FirstRand Bank Limited - Listing of New Financial Instrument
28/02/201216:31 Exxaro - Trading of Exxaro Ordinary Shares on behalf of the Exxaro
28/02/201216:24 Iliad Africa Limited - Trading Statement
28/02/201216:00 London Finance & Investment Group P.L.C - Trading Statement
28/02/201215:50 Metmar Limited - Metmar secures increased trade lines
28/02/201215:23 PSG Group Limited - Donation of PSG Group Limited shares by a director
28/02/201215:21CLN000117 - The Standard Bank Of South Africa Limited - Interest Rate
28/02/201214:48 Calgro M3 - Dealings in securities by directors
28/02/201214:45 Resilient Property Income Fund Limited - Dealing in securities by an
28/02/201214:43FFA/FFB - Fortress Income Fund Limited - Dealing in securities by company
28/02/201214:35NDP - Grindrod - Final Results
28/02/201214:25 Santam Limited - Audited abridged financial report for the year ended 31
28/02/201214:18 Stefanutti Stocks Holdings Limited - Changes to the board as an
28/02/201214:04 Curro Holdings Limited - Reviewed group results for the financial year
28/02/201213:59BIRP - Real People Investment Holdings (Proprietary) Limited - Interest
28/02/201213:58 Curro Holdings Limited - Declaration announcement of the Curro rights
28/02/201213:00 Poynting Holdings Limited - Unaudited condensed consolidated interim
28/02/201212:52NAI/NAN - New Africa Investments Limited - Change in directorate by Non-
28/02/201212:04STAN40 - Stanlib Top 40 Fund - Partial Delisting of Stanlib40 Securities
28/02/201211:18BIIIPL - iNguza Investments (Proprietary) Limited - Listing of Tap Issue
28/02/201210:33 Massmart Holdings Limited - Trading of Massmart ordinary shares on
28/02/201210:07 Acucap Properties Limited - Dealing in securities by the company secretary
28/02/201210:00 Purple Capital Limited - Dealing in securities by directors: grant of
28/02/201210:00 ARB Holdings Limited - Renewal of cautionary announcement
28/02/201209:37 RGT Smart Market Intelligence Limited - Directors` Dealings and
28/02/201209:24 Distell Group Limited - Dealings in securities by a director
28/02/201209:04SCIB - The Standard Bank of South Africa Limited - Issue of stock warrants
28/02/201209:03 Blackstar Group SE - TR-1: Notification of major interest in shares
28/02/201209:02 Metmar Limited - Announcement regarding related party transactions entered
28/02/201209:00 African Eagle Resources Plc - Mokambo Exploration Update
28/02/201209:00 ZCI Limited - Cautionary announcement
28/02/201208:07 RBPlat - Audited Abridged Results for the year ended 31 December 2011
28/02/201208:00FSR/FSRP - FirstRand - Unaudited Interim Results and Cash Dividend
28/02/201208:00ESR - Esorfranki Limited - Further cautionary announcement
28/02/201207:10 Anglo American plc - Treasury Shares - Transfers
28/02/201207:10 British American Tobacco p.l.c - Transaction in own shares
28/02/201207:10SYN903 - Synthesis Funding Limited - New Financial Instrument Listing
28/02/201207:07GPT15 - Growthpoint Properties Limited - New Financial Instrument Listing
28/02/201207:05 South Ocean Holdings - Audited abridged results announcement for the

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