Sifting through the enormous streams of data is something similar to seeing the trees from the forest. There was a time not too long ago (and I’m certainly no old-timer) when life and all of its rather minute details seemed so insignificant. Mind you, I’m talking about a time when a young boy would break through the doors of his grade 6 school at 4pm and make some difficult (but important) decisions: Play ball at the park or ride a bike while trying to keep up with his father’s daily jogging routine or fiddle around with Nintendo’s RBI Baseball. In any case, the point is quite clear: There is just too much information in our world today. As was made very clear to me by my brother Sean not very long ago, the first news ticker dawned on the world sometime around the first Gulf War. Since then we’ve been inundated with an abundance (and at times, overload) of both useful and useless information. For the most part, I’d say the information has been utterly useless. Case in point: while checking email on my Yahoo! account I was given the link to how Victoria Beckham, of the Spice Girls fame, keeps her perfect posture. (I must admit, I did read the article).
Ms. Beckham and all of her posture-perfect poses aside, the Ambroise Investment Value Fund likes to sift through all the “gristle” and get straight to the “meat” of the matter. The meat in this case refers to what matters most when investing: the cold hard facts. That’s the truth, Ruth!
Speaking of which, let’s get down to business. Throughout this rather tumultuous month the AIVF looked like a two-headed beast. On the one shoulder lay a portfolio that followed the risk-weighted trends that saw worldwide stocks get hammered by the warnings coming out of Greece, the constant reminder that the world economy is tip-toeing the fine recovery line, that the consumer led (or the supposed need for one) is none existent and so on. On the other lay a well-balanced, healthy portfolio of stocks that are reporting steady (if not growing) profits. So what gives? What can one make from all this inconsistency in the general public along with the bountiful progress that well selected companies are enjoying? Stay the course….
International Portfolio: Let’s get started with our Star selection for the month. Great Eagle Holdings, who announced their Annual Results on 2/24, pulled in an impressive 11.4% return. The Hotel and Office real estate company showed in its earnings higher core profits, lower interest costs and a steady dividend payout. Way to go Eagle! The Link Reit, a shopping mall owner and manager, showed up with a healthy 6.4% return on the month. GZI Reit, which houses a number of office and shopping properties in Greater China, reported a small gain of 1.3%. We should have Year-end results by the end of March for GZI. Rounding out the portfolio was Standard Chartered Bank with a negative return of 2.2%. The Bank will be reporting Year-end results on 3/3.
Canadian Portfolio: The Canadian portfolio didn’t see much action this month with very little in the way of upward or downward movement. In fact, this month’s returns were quite boring – except for those lovely, happy dividend payments. Oh, there was one star that sprung loose: Yellow Pages Income Fund. With Online Revenue increasing and Expenses remaining flat, Pages gathered steam with a pleasant 14.5% return on the month. Their results on February were also helped by the announcement that Pages will maintain a healthy dividend throughout the 2011 transition to corporation status. I think I’ll paint my office yellow!
United States Portfolio: The US portion of the Fund was active throughout the month. Many of the companies within the US sector reported earnings. While Q4 and the Fiscal Year weren’t blowouts by any means, the sector held up quite well – this is to be expected with their “bread and butter” characteristics. Carnival Cruise, a strong indicator of consumer’s appetite to spend and vacation, shot through the roof on the final few days of the month. Overall, the stock pulled in a 4.8% gain coming on the back of increased summer pricing. Others that followed in Carnivals path were LS Starrett (9.2), Colonial Properties Trust (9.5) and HRPT Trust (1.6). Cedar Shopping Centers, which has seen its stock price increase over the last several months, took a breather (mind you, a deep breath) with a losing month of 9%. Rounding out the portfolio was Suntech Power Holdings with a small 1.6% loss. Cedar and Suntech will report Year-end results on 3/3.
Final Thoughts: The Fund began a slow and steady climb into the back seat of Toyota Motor Corps US shares. Although Toyota is going through a plethora of troubling issues at present, we feel that the company is still sound and sports a healthy balance sheet. (By the way, have you counted how many cars are still on the road tagging those Toyota logos?). The month of March will see the Fund take its first few incremental steps into the Forex market with the purchase of the Chinese RMB. We will continue to update you, the investor, on any significant purchases made within the Fund.
