The Anchor BCI Equity Fund ended 2019 up 7.7%, against the benchmark FTSE/JSE
Capped Swix, which closed the year 6.8% higher. The “phase 1” trade deal between China
and the US helped catalyse a rally in emerging market (EM) stocks and currencies, dragging
the rand (+4.7% in December) and the benchmark (FTSE/JSE Capped SWIX Index [Capped
SWIX] +3.1% in December) with them. Pla..num shares were again leading the way, up
another 20% to cap a year in which their share prices tripled! Gold shares con..nued the
rollercoaster bouncing back from a double digit sell-off in November to post a double-digit
gain in December, leaving gold stocks up 120% for the year. Gold and pla..num shares
accounted for 80% of the Capped SWIX performance in 2019 and almost half of
December’s performance. Naspers was the other key contributor in December as it
combined with Prosus to end the month up 8%, in aggregate, helped by rand strength and a
rally in Chinese shares. Sasol finished an otherwise disappoin..ng year with a strong
performance, up 15% as it was buoyed by a rally in the oil price and the hope that it may
avoid a capital raise.
Our posi..oning has remained balanced throughout the year, with the lack of domes..c
growth pain..ng a frustra..ng backdrop for the domes..c equity market . However, a..rac..ve
valua..ons have kept our alloca..on to domes..c cyclicals at around 35%, with the balance
split between businesses with li..le to no opera..ons in South Africa and mining companies.