The FTSE/JSE All Share Index (ALSI) increased by 0.2% during September. FTSE/JSE Shareholder Weighted Index (SWIX) increased by 0.4% and FTSE/JSE Capped Shareholder Weighted Index (Capped SWIX) increased by 0.7%. The Rand strengthened by 0.4% during the month. Resources and Industrials decreased by 1.1% and 0.7% respectively, while Financials increased by 3.5%.

During September, Bonds increased by 0.5% and Cash returned 0.6%. The MSCI Emerging Market Index increased by 1.7% (USD), underperforming the MSCI World Index which increased by 1.9% (USD). The MSCI South Africa Index decreased by 1.2% (USD). During September Iron Ore fines increased by 5.3% to $92.5/t and Thermal Coal increased by 6.4% to $62.3/t. Brent Crude oil increased by 1.4%, ending the month on $59.3/bbl. Gold was down 3.2% to $1472/oz and Platinum decreased by 5.4% to $883/oz. Palladium increased by 9.0% to $1675/oz. Gold retracted slightly during September but will continue to be driven by continued geo-political uncertainty, trade wars and negative yielding bonds. Iron ore recovered during September, we expect the price to be well supported going into the Chinese winter season when local production are shut.

Consumers in developed markets continue to benefit from low levels of unemployment and higher real wages, whilst manufacturing output is slowing down. The risk of a global recession has increased in recent months. Most Central banks have signalled their willingness to ease monetary policy should the risk of a recession increase further. The VIX Index (Volatility or ‘Fear’ Index) decreased by 14.4% to 16.2 during September.

During September there was some retraction of industrial counters with the precious metals sectors (both gold and PGM) doing well, the fund’s performance was positively affected by positions in Impala (10.2%), Capitec (17.6%), Anglo American (7.4%) and Northam (5.7%), while positions in Anglogold (-17.9%), Harmony (-22.1%), African Rainbow (-9.7%) and Sappi (-17.0%) detracted from performance.

The fund invests in a number of focussed strategies. Amongst these strategies we are overweight Earnings Growth (Rand Hedge Consumer Discre..onary), Cyclical (Diversified Mining, Platinum), Defensive (Gold Mining) and Value (Property, Local Consumer Discretionary, Platinum & Paper).