18 May 2012 GLOBAL ASSET ALLOCATION We have battened down the hatches from a tactical asset allocation perspective over the past few weeks. In a crisis, we have learnt that if you need to panic, it is best to have panicked first! Those asset allocators who have issued statements this week that they are sitting out this volatility are generally overweight global equity and do not have much choice. But are we nearing the end of the secular bear market in developed world equities?

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11 May 2012 WHAT IS A FRIEND WORTH? As many of our readers are probably aware, Facebook (FB) is about to come to market in the coming days; this will probably be the largest IPO (Initial Public Offering) of a stock ever. The IPO is estimated to raise approximately $10 billion, valuing the company at between $77 and $96 billion at launch. To put this into context, if the upper end of this range is achieved, FB will be half the size of Google and would rival the market value of Amazon.com and Cisco Systems Inc.

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4 May 2012 SWIP SACKS HALF OF FUND MANAGERS FOR ROBOTS There used to be an old adage that you didn’t buy a life company policy, you were much better off buying the shares of the life insurance company. Well a similar idea is that instead of buying what fund management companies are promoting, sometimes aggressively, you should look at how the fund management companies are positioning themselves for the future. Driven by client demand, Scottish Widows Investment Partnership (SWIP), the Lloyds Bank subsidiary recently announced some major changes to their business model, which sparked headlines “SWIP sacks half of fund managers for robots”.

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20 Apr 2012 GLOBAL WEEKLY COMMENT In the last few weeks markets have woken up to the likelihood of an eventual Spanish default/ restructuring. They have recognised what every first year economics student should know: when interest rates on government debt are higher than nominal growth rates for a protracted period, the debt can simply not be repaid. Bond holders know full well that for principal to be repaid, economic growth (rather than austerity) is required. Similarly, a floating exchange rate and not a fixed exchange rate is needed (see Argentina 1998-2000). Thus, when an IMF-style austerity program is put in place, bond rates will soar while growth craters— exactly what we are seeing now in the Euro zone. Spain currently finds itself stuck between a rock and a hard place as far its finances are concerned. If it does not announce austerity cuts, yields will rise, as has been the case since the 2nd March, when the Spanish Government announced it won’t meet its deficit target this year. However, if the Spanish government does announce austerity measures that are too draconian, bond investors will be concerned that cuts will push the economy further into recession and prevent the Spanish from repaying their debt, i.e. a debt trap. Spanish banks are not helping matters either. They are going to need more funding as they are forced to raise their Tier1 Core Capital ratios, not to mention the potential new capital that will be needed as bad debts start rising. Government recapitalisation will only add fuel to their debt crisis.

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GLOBAL COMMERCIAL REAL ESTATE - Finweek article by Scott Campbell International commercial real estate as an asset class has provided quite the roller coaster ride over the past 10 years. The leveraged boom almost a decade ago provided the opportunity for multiple promoters of listed and open-ended investment vehicles to raise capital for dubious (at best) schemes. The most important decision when investing in this asset class is choosing the type of investment vehicle that owns the actual underlying commercial property. There are vastly different liquidity, valuation, costs, short-term performance and other due diligence divergences in this sector.

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MitonOptimal opens Singapore Office and announces two key appointments. MitonOptimal, the specialist global multi asset management business, announces the opening of its new region headquarters in Singapore. Located in Amoy Street near the Central Business District, the office will be responsible for the Asian Independent Financial Adviser (IFA), private bank sales and support plus the regional push into the institutional and family office market.

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MitonOptimal to launch institutional asset consulting business and announces a key hire. MitonOptimal, the specialist global multi asset management company with a presence in Guernsey, South Africa and Asia today announces the launch of its South African institutional asset consulting business. MitonOptimal has an impressive 15 year track record of global multi asset management in very adverse conditions. We have built a 5 year track record in the domestic South African retail (Collective Investment Schemes) space and are well positioned to become a leader in implemented consulting and other business growth opportunities. We are delighted to announce the appointment of Professor Evan Gilbert as a director and Head of Institutional Asset Consulting from 1 September.

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