Newsletter:

Subject:	'Recovery' taking place against a backdrop of weak fiscal positions and excess cash
Date:	25 Jan 10

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Many of the the current articles on our website seem to be preoccupied with the tension between signs that the recession is ending, and that fact that this 'recovery' is taking place against a backdrop of weak fiscal positions and excess cash.

Our Intervest investment team warns that the current favorable investment environment may well result in equity markets that overshoot fair value. Heiko van Wyngaarden gives a list of concerns that could rattle markets. You can read the report by clicking here

There are a few articles that examine investor and fund manager behavior in 2009. Prieur du Plessis asks which funds were chosen by investors during 2009 and Liz Still attempts to distinguish between value fund managers who benefitted from the ‘once in a generation’ buying opportunities and which ones got side tracked by the pessimistic global mood.

Looking to 2010 and beyond, Peter Brooke of OMIGSA warns investors to save more and to be realistic about equity and bond returns over the next five years.

And lastly, retirement annuity season is nearly upon us. Investors have until the end of February to boost their RA investments, or invest in a new RA.

As Equinox clients will know by now, the process of investing in a RA using our platform could not be simpler. If you are boosting an existing RA, all you have to do is complete our additional contribution form (available on our public website) and submit to us via fax or email. You then deposit the money to be invested into your RA into our nominee account.

If you wish to invest in a new RA before the end of February, the same process will apply, except we need an RA application form and FICA details. In order to invest in the current tax year, we must receive the forms, money and FICA details if applicable, by 23rd of February 2010.

If you have any queries, please call our offices on 0860 378 466.

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The global investment environment is currently a mix of troubled government finances and excess liquidity: Adrian Saville
Adrian Saville, CIO of Cannon Asset Managers writes that there is evidence of growth in the global investment environment, but growth should be seen against a backdrop of weak fiscal positions and excess liquidity.

More at http://www.equinox.co.za/article_2431.html

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Which unit trusts did investors back in 2009, asks Plexus.
Prieur du Plessis, Chairman of the Plexus Group writes that global credit crisis in mid-2007, 2008 and the start of 2009 caused high investor risk aversion. Unit trust investors moved large sums of money to the so-called safe-haven investments such as money-market and fixed-interest funds.

More at http://www.equinox.co.za/article_2433.html

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Did some value fund managers fail investors in 2009?
Some analysts described the 3rd March 2009 price lows, when the JSE All Share index was at 17 953 as 'the buying opportunity of a generation'. So which fund managers actually went to the sale and loaded up their trolleys? And how do results compare if we also throw in those fund managers who say they sail their ships under the colours of value investing?

More at http://www.equinox.co.za/article_2427.html

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Save more, expect lower returns and don't listen to daily investment news for the next five years: Peter Brooke
Investors should start getting used to the idea that real returns will be lower over the next few years, says Peter Brooke, head of Macro Strategy Investments at Old Mutual Investment Group SA. He was speaking at a media briefing earlier this week.

More at http://www.equinox.co.za/article_2430.html

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Debt is never free: Duncan Artus
Duncan Artus, portfolio manager at Allan Gray writes that governments around the world are engaged in significant fiscal and monetary stimulus. But there is some doubt about whether their efforts will improve the real economy sustainably, and it is unclear what effect they will have on equity valuations.

More at http://www.equinox.co.za/article_2434.html

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Investing 2010: Sober thinking required
Lance Vogel, CIO of Analytics Investments writes that while guarded optimism seems to be widespread as we head into 2010, it does not take long to identify possible storm cells on the horizon that may have an unwelcome, disruptive influence on investment markets.

More at http://www.equinox.co.za/article_2423.html

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Best Regards
The Equinox Team

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