Funds GreatLink - Great Eastern Life

GREATLINK GLOBAL VALUE EQUITY FUND report as at 31 December 2005
FUND FACTS
Inception Date 25 March 2002
Offer Price S$ 1.140
Bid Price S$ 1.083
Fund Size
S$ 65.14 mil
Fund Manager
Lion Capital Management
(wef 26 Sep 2005)
Sub Fund Manager
Capital International, Inc.
Bid-Offer Spread 5%
Fund Management Fee
1.50% p.a.
Valuation Frequency
Daily
Currency of Fund
Singapore Dollar
CPF Approved
CPFIS – OA
Risk Category
Higher Risk / Broadly Diversified
Mercer Fund Rating as at 31 Dec 2005 ★★★★
S&P Fund Stars as at 31 Dec 2005 ★★★
FUND OBJECTIVE & INVESTMENT STRATEGY
The fund objective is to achieve capital appreciation through
the continuous management of a diversified portfolio of transferable
securities consisting primarily of common stocks, researched and
selected on a world-wide basis.
PORTFOLIO WEIGHTINGS
Pacific ex Japan
3%
FUND PERFORMANCE SINCE INCEPTION
Price Indexed
Europe
30%
Japan
19%
Emerging Markets
2%
Cash
5%
North
America
41%
Performance Review (Mar 2002 to Dec 2005)
130
125
+21.92
120
115
110
105
100
+14.48
95
90
85
80
75
70
65
60
Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec
02 02 02 02 03 03 03 03 04 04 04 04 05 05 05 05
––––– Greatlink Global Value Equity Fund ––––– Benchmark Index
Source: Northern Trust prior to 1 November 2004. Bank of New York thereafter, S$ bid to bid performance.
Benchmark: MSCI World Index with net dividends reinvested
For Top 10 Investments refer to page 86.
MARKET REVIEW
It was a good year for global equities, supported by strong
profit growth. Global economic growth was good and inflation
remained subdued. The best results among developed markets
came from Japan. Resource rich countries such as Canada were
also strong. Commodity indices registered a fourth-straight year
of increases, helped by strong demand.
Energy stocks led the markets for the first three quarters
and had the best returns by far for the year fuelled by soaring oil
prices. Crude oil futures reached a peak of US$67.9 in the third
quarter then eased back below US$60 towards the end of the
year. Cyclical stocks took the lead in the fourth quarter, with
materials and industrials ending the year with large gains. Financials
also had good results thanks to record profits. Mergers and
acquisitions occurred at a feverish pace, with global deal volume
up 38% from 2004, according to preliminary year-end data. Private
equity transactions also ran high as well as underwriting, with
many high profile IPOs outside the US. The telecommunications
services sector was the weakest by far. Investors grew increasingly
concerned about bleak growth prospects (in developed markets),
pressure on profit margins and fears that cash-rich operators
would overpay for acquisitions.
Current account imbalances showed no sign of correcting.
Despite this, the US dollar defied conventional wisdom and rose,
thanks to higher interest rates. Despite many doubters, the U.S.
economy remained strong in the face of high energy prices, natural
disasters, concerns about US consumers, and rising interest rates.
The Federal Reserve raised the federal funds rate from 2.25% to
4.25%, though their stated goal is not to achieve a tight monetary
policy, but rather, to move from an accommodative policy to a
neutral one.
The European equity markets rallied throughout most of
2005 and finished the year with good annual returns. There were
signs that an economic recovery was beginning to take hold in
the eurozone, and, in a move that was widely anticipated in the
market, the European Central Bank raised interest rates by a
quarter percent to 2.25% on 1 December. In the UK, the government
reduced its economic growth forecast for 2005 and 2006.
The gradual economic recovery in Japan gained believers as
the year progressed. The stock market surged. Reforms regained
momentum after the prime minister’s landslide victory in a snap
parliamentary election which reinforced his mandate for reform
including the proposed privatization of Japan Post.
Currencies played a major role over the year with rising
interest rates in the U.S. helping to support the dollar which
strengthened 15% against the euro, 12% against the British pound
and 15% against the Japanese yen.
PERFORMANCE ON BID-BID BASIS (%)
3mths 6 mths 1 year 3 years 3 years Since Inception Since Inception
(annualised)
(annualised)
Greatlink Global Value Equity Fund 4.74 11.88 12.34 57.41 16.33 14.48 3.66
Benchmark Index 1.43 8.65 11.52 60.27 17.03 21.92 5.40
20 NOTE: This factsheet is compiled by Great Eastern Life. The information presented is for informational use only. The performance of the Fund is not guaranteed and the value may increase or
decrease in accordance with the future experience of the Fund. Past returns are not necessarily a guide to future performance.