Monthly Commentary

For the month of November 2013, the FTSE/JSE All Share Index (ALSI) lost -1.1%, while the FTSE/JSE Shareholder Weighted All Share Index (SWIX) lost -1.6%. Over the month, the resource sector lost -2.1%, while industrials gained 0.1% and financials lost -3.1%. Large caps lost -1.1%, mid-caps lost -1.0% and small caps lost -0.7%.

Within the resources sector, we continue to have a bias towards the large diversified and high-quality mining companies, as they are typically low-cost producers with diversified income streams across various commodities and geographies. We also hold selected single-commodity shares in businesses that we believe have a competitive position in their respective industries.

In the South African industrial sector, we have reduced the fund's exposure to a few of the domestic consumer industrials as they have now reached full value. With the proceeds, we have slightly increased exposure to selected, high-quality and better-value rand-hedge industrial shares. We have also purchased some great quality mid- and small cap local industrial businesses that are trading at attractive valuations.

Within financials, based on our company valuations, we retain a preference for selected banks and we have recently been increasing our banking holdings further.