STANLIB Global Science and Technology Fund has closed and merged into STANLIB Global Equity Feeder Fund.

Fund Review
The fund had a good first quarter of 2013, rising by 7% in dollar terms (versus 6.6% for the MSCI Global Index) and an impressive 17.6% in rand terms, with the help of rand depreciation of 9% against the dollar, 6.4% against the euro and 0.5% against the pound. This was the first complete quarter under Threadneedle Investments' management. For the year to end March, the return was 6.2% in dollars (mostly under Origin's management) and 27.9% in rands, as the rand fell 17% against the dollar. The portfolio has benefited from its overweight in the US (55% versus 46% for the benchmark) and also its underweight in emerging markets (7.4% versus 12.6% for the benchmark). The US S&P 500 Index had a total return of 10.6% in dollars in the first quarter, while the MSCI Emerging Markets Index lost 1.6%. Also the portfolio is underweight Europe, excluding the UK (13.1% versus 15.9%). An underweight in Japan hurt the portfolio (7.2% versus 7.6%) as the Japanese market produced the second best dollar return of the big markets (10%).

As far as sectors go, the portfolio is very overweight in Consumer Discretionary (15.6% versus 10.8% for the benchmark) and in IT (15.9% versus 11.9%) and underweight in Financials (16.6% versus 21.4%) and Energy (7.3% versus 10.4%), marginally so with Materials (mostly mining, at 7% versus 7.2%). The five biggest shares in the portfolio are Samsung (IT), Toyota, Novartis (health care), AON (Financials) and Pfizer (healthcare), although these five only constitute in total 10.7% of the portfolio, while the top ten constitute 20.2%. There are 78 shares in the fund and Google , Unilever and JP Morgan are in the top ten. The fund has reached a new record high in rand terms.

Looking Ahead
US equities, which comprise around 46% of the MSCI World index, reached a record high in early April and still offer decent value, assuming the US economy continues to grow around 2%. Japanese equities are picking up nicely in line with their economy, so it is Europe and the UK that are struggling a bit. Overall we still prefer equities and listed property offshore to bonds. Could this be one of the few years when the May to August period is positive rather than negative for risk assets like equities?