September proved an exceptional month for global equity markets, with the MSCI World returning 4.8% as the possibility of the Fed tapering its quantitative easing programme waned. This, in turn, led the JSE higher with gains across most sectors-the JSE SWIX ended the month 5.6% higher including dividends. In this context, the fund delivered returns in line with the broader market and has now returned 14.7% since inception (SWIX: 15.2%) despite a tough start in April/May. By far the biggest contributor to the funds' performance during the month was Steinhoff, which rose by 22% on the back of better than expected FY13 results. Despite these gains, this share continues to offer great value at a forward 7.5x PE multiple-importantly, further Rand weakness should provide a 15% tailwind to FY14 results and we think the odds of a European listing of the group's non-SA operations in the next 6-12 months are high. As a result, we added to our Steinhoff position during the month. Other key gainers included Aspen, Naspers, Atterbury, Dawn and Italtile, while relative laggards included BHP Billiton, Sasol and Spur Corporation. Atterbury (now re-named "Attacq"; 6% of the fund), is due to list on the JSE mid-October and has already risen a further 11% in the OTC market post month-end-we expect a listing price of ~R15/share, while our fair value for this stock is closer to R17. During the month, we marginally increased our offshore cash weighting and have identified a potential new investment in a US-listed retailer.

Following an exceptional performance in May (+6.7%), the JSE SWIX index gave back much of these gains in June with a decline of 4%. This was led by resources, with the RESI 20 index declining by 13.5% during the month. Overall, while volatility remains high the SA market remains fairly range-bound and has delivered a paltry total return of 2.3% year-to-date (as measured by the JSE SWIX index).

In this context, while the fund lagged the market's stellar May performance, its decline in June was significantly less than the overall market. This was largely due to our low resource exposure given continued concerns of unsustainably high profit bases in the diversified miners in an environment of growing supply. In addition, some of our industrial holdings performed very well-Aspen, for example, rose by 9% during the month following the company's announcement of significantly earnings-accretive corporate activity. Notable changes to the fund during the month included the sale of Bidvest (bought as a trade following weak share price performance relating to the Adcock bid) as well as reducing the holding in Ellies. We also added Omnia, Brait SE and Old Mutual plc as new holdings to the fund during the month.