Managed Accounts First Quarter 2010 Letter To Clients
Dear Client
Dear Client
There is no denying that we have found it hard to make money for our managed accounts in the first quarter. We had a number of successful trades, one loss in Lihir Gold and the QHL share price faded as we wait for the formal signing of the contract for the Joint Strike Fighter Project (due at the end of the current quarter). All of these events combined saw an overall slight decline (2.5% approx) in the value of our portfolios. A disappointing result, but one we are working tirelessly to rectify.
Some of our clients have expressed their disappointment with the quarterly result, which we understand completely. We strive to make the best risk adjusted return possible for our clients each year, and in flat markets such as these there is certainly the incentive to add more risky positions simply to try to generate a return. Rest assured we certainly won't do that just to satisfy the desire to show a quarterly result each quarter.
Having said that this quarter has gotten off to a much better start, our positions have started to perform well and have shown good resilience to selling pressure on down days. All of our positions were entered at excellent entry prices and we anticipate locking in profits on some if not all of these trades at some point during the quarter.
With the recent announcement of the downgrading of Greece's sovereign debt to 'junk' by S & P we may see increased volatility come into the market in the coming weeks. While this announcement was largely expected it was enough to send overseas markets down more than 2% on the news. As volatility increases so too do opportunities to buy quality stocks in the low end of their current trading ranges. We will be keeping a keen eye on the market as the story develops.
Thanks for your patience in receiving this quarterly report, and thanks also for your continued support.