Tag Archives: Stocks

Saxo Bank And ICAP Shipping Involved In World’s First Electronic Container Freight Swap Settled In USD

Saxo Bank, the trading and investment specialist, and ICAP Shipping, the shipping arm of ICAP plc, announced on Thursday that they were involved in the execution of the world’s first electronic, voice-assisted trade of a container freight swap agreement settled in US dollars.

The counterparties to the trade were Saxo Bank in Denmark as the buyer and a Netherlands-based trading house as the seller. ICAP Shipping was the broker of the trade. The container freight swap agreement was executed on ICAP’s Webtrader platform, with manual input from ICAP Shipping brokers and cleared by LCH.Clearnet.

The trade was executed by rugby star Lawrence Dallaglio during ICAP’s 19th annual Charity Day. On ICAP Charity, all ICAP revenues are donated to a selection of 200 charities and celebrity patrons are invited to help close deals. Mr. Dallaglio attended ICAP Charity Day in support of Cancer Research and Great Ormond Street Hospital.

Container freight swap agreements lock in the freight exposure for standard containers transported from Asia to Europe, Mediterranean countries and the United States. Cash flow for this sort of freight exposure has been unpredictable for retailers, importers and logistic companies in the past and the concept of pricing container freight against indices and using swap agreements to manage the risk has attracted many industry participants over the last year. Screen execution with the added surety of voice broker assistance was a key requirement of customers.

Henry Liddell, CEO ICAP Shipping said: “The execution of the world’s first electronic container freight swap agreement is an important milestone in the on-going development of the container swaps market. This youngest segment in the shipping industry has seen a rapid growth over the last decade and will become an even more important risk management tool in the current economic environment. Container swaps are a hedging tool for the container industry to manage the price volatility of the physical market.”

Johan Gade, Freight & OTC Derivatives, Saxo Bank said: “We fully support electronic freight derivatives trading and believe that going forward container swaps will be a valuable addition to the electronic dry bulk and tanker freight derivatives offering we are about to launch.”

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Saxo Bank Announces Half Year Results

Saxo Bank reported a net profit of DKK 346 million for the first six months of 2011. The result which is in line with expectations represents an increase of 375% over the second half of 2010, and a decrease of 37% compared with the first six months of 2010, where market activity and volatility were unusually high.

– Operating income DKK 1,772 million (DKK 1,992 million)
– Profit before tax DKK 474 million (DKK 729 million)
– Net profit DKK 346 million (DKK 551 million)
– Solvency ratio 12.3% (19.2%)
– Clients’ collateral deposits DKK 32,855 million (DKK 26,590 million)
– Assets under management DKK 32,357 million (DKK 24,606 million)

Saxo Bank saw a significant increase in average monthly volumes traded in CFD stock indices, single stocks and commodities, cash stocks, FX options and futures compared to the same period last year. Monthly FX volumes averaged approximately DKK 1.2 trillion in the first half of 2011, with lower trading volumes in the first quarter and a pick up in the second.

While the overall trader and investor activity level was moderate in the first half of 2011, the Bank saw continued growth in clients’ collateral deposits and assets under management, which are the foundation for future business and profits. Total assets under management in Saxo Bank’s trading business increased from DKK 31.2 billion as of 31 December 2010 to DKK 32.4 billion as of 30 June 2011. Clients’ collateral deposits in Saxo Bank’s asset management business increased from DKK 31.3 billion as of 31 December 2010 to DKK 32.9 billion as of 30 June 2011.

Operating income for the first six months of 2011 reached DKK 1,772 million for the Group. This is lower compared to the same period in 2010, but represents an increase in trading-related income following on from the second half of 2010.

Kim Fournais and Lars Seier Christensen, co-founders and CEOs of Saxo Bank, said in a joint statement: “Saxo Bank achieved a satisfactory half-year net profit fully in line with expectations, despite general market conditions which reduced risk appetite in the economy and dampened capital market activities. While keeping a close eye on overall cost developments, Saxo Bank will keep its focus on expanding our products and services as well as optimising the efficiency and profitability of our operations. Overall, we believe the Group has a solid foundation for current and future operations and we expect to continue to create value for our stakeholders.”

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Saxo Properties and Resolution Property Form a €250 Million Joint Venture

Saxo Properties, the property investment arm of Saxo Bank, the Copenhagen-based trading and investment specialist, has entered into a joint venture with Resolution Real Estate Advisers LLP “Resolution Property”, the pan European real estate fund, whose investors include some of the major US universities such as Harvard and Yale and foundations, currently has €1.5 billion of assets under management.

The Joint Venture will focus on co-investing up to approximately €250 million in the central business district of Copenhagen, targeting residential and mixed use, residential and commercial buildings which will benefit from the application of intensive asset management, including refurbishment and the repositioning of occupiers. With an in-house team of 15 highly skilled property professionals and a facilities management arm, Saxo Properties is well positioned to identify off market opportunities, and implement an asset management programme of improvements resulting in significantly enhanced returns for investors.

The new venture, which is already targeting its first purchases, will have a life of three to five years with the emphasis on income growth and capital gains.

Jesper Damborg, Chief Executive of Saxo Properties said: “We are delighted to have teamed up with Resolution Property, one of the leading pan European real estate investors, with assets across Continental Europe. The Joint Venture will seek to take advantage of carefully selected opportunities which have the potential to produce above average returns in the medium term.”

Robert Laurence, Chief Executive of Resolution Property said: “The stability of the underlying economy in Copenhagen, coupled with the opportunity to acquire good quality assets at levels representing a significant discount to their peak values, is of great appeal to us. Our Joint Venture with Saxo Properties provides a highly experienced property team at local level with an established track record of achieving good returns and an exciting opportunity for us to develop our value add real estate strategy in a new market place.”

Saxo Properties is a wholly owned subsidiary of Saxo Bank and was launched in March 2010 to provide closed end funds for both high net worth clients and institutional investors, focusing on residential, office and retail property in Central Copenhagen.

Originally founded in 1998, Resolution Property, backed by a shareholder base including international private equity investors, pension funds and major US universities and foundations, is invested across continental Europe including France, Poland, Germany, United Kingdom and Switzerland. With a €808 million capital raising completed in 2007, Resolution Property is targeting a portfolio size over €2.6 billion.

de Morgan & Company of London, acted on behalf of Saxo Properties in the negotiations and Resolution Property was represented by Whitmarsh Holt Young along with local advisers including Plesner and Sadolin & Albæk.

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Saxo Bank Scoops Six Awards at the Euromoney Annual FX Survey 2011

Saxo Bank has picked up no less than six awards at the Euromoney annual FX survey 2011. The categories in which the online trading and investment specialist was voted into the top spot for are:

– Best Improved Overall Market Share By Volume ($10bn – $25bn)
– Best Improved Overall Market Share By Volume ($5bn – $10bn)
– Best Speed of Execution
– Best Research and Analytics
– Best Effective Risk Management and Execution Strategies
– Best Integrated Workflow and Compliance Solutions

Albert Maasland, Senior Vice President and Chief Executive of Saxo Bank London said at the awards ceremony in London last night: “These awards are an accolade to Saxo Bank’s experience in the online trading business and its recognition in the market place. Saxo Bank received more award wins this evening than ever before in our history. This follows our best full-year results ever. I am honoured to accept these awards on behalf of our two founders and my colleagues. All six awards reflect our ongoing commitment to respond to our broad client base and provide the FX market with consistent competitive pricing and leading value-adding products and services.”

The Euromoney annual Foreign Exchange survey is in its 22nd year. The survey is the industry’s leading review of FX trading, research and e-business capabilities and is widely considered as the benchmark league table for the FX market. The awards are a reflection of the efforts of the wider FX industry to provide the tools and functionality that make trading FX more efficient. Results are based on qualitative responses from thousands of companies around the world. Last year over 11,700 votes were cast in the survey, including those of treasurers, traders and investors.

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Saxo Bank First To Offer Direct Online Trading In Brazilian Market

Saxo Bank, the specialist in online trading and investment, has launched four futures that will, for the first time, offer investors who are not residents in Brazil direct access to the Brazilian market. The products include the Bovespa Index and USD/BRL cross and enable investors to gain exposure to one of the currently most buoyant economies and hedge risks in their portfolios.

With this launch, Saxo Bank provides investors with four futures investment instruments – the BOVESPA Index, IBOVSPA Index Mini, BMF US Dollar Future and Mini BMF US Dollar – that are available on all of the bank’s platforms (SaxoTrader, SaxoWebTrader and SaxoMobileTrader).

Moreover, Saxo Bank expands its coverage to over 20 futures markets and more than 80 trading venues which can be accessed via a product range comprising more than 22,000 financial instruments.

In a statement, Pedro Brigham, director of the Latin region for Saxo Bank, said: “The rise in commodity prices has put Brazil on investors’ radars. Its excellent economic growth, political stability and a liquid market where over 3.5 billion US dollars are traded on a daily basis have made the country the clear leader in Latin America at a time when investors increasingly demand greater access to emerging markets”.

Claus Nielsen, executive vice president and head of markets at Saxo Bank, added: “The launch of futures trading in Brazil marks a significant milestone for Saxo Bank, and we are proud to be able to offer our global client base access to this vibrant economy. We look forward to expanding the list of available instruments in Brazil and to further add trading venues in emerging countries to our platform.”

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TradingFloor.com Releases Video on the German Economy

TradingFloor.com, the home of Saxo Bank’s trading commentary, financial research and analysis, has released the video ‘Why the German economy continues to outperform in Eurozone’.

Despite a minor correction in industrial orders in December, the German economy continues to stand out from the rest of the Eurozone members in terms of growth. In the video Mads Koefoed, macro strategist at Saxo Bank’s Tradingfloor.com, discusses the performance of Europe’s largest economy versus the 16 other Eurozone members.

Mads Koefoed discusses two main reasons why he believes the Germany economy is continuing to outperform other countries in the Eurozone. Germany is turning part of its foreign exports away from other countries in the Eurozone and towards Asia. While Germany still continues to do a lot of trade within the Eurozone, by turning to Asia, where more solid growth is taking place, it is doing better than other Eurozone countries that have not moved some of their trade overseas.

Southern countries such as Spain, Portugal and Italy have also seen higher cuts on public spending than have happened in Germany, meaning Germany should recover much stronger.

Mads is optimistic that the economic growth of Germany will continue throughout 2011 and hopefully into 2012, because while Germany is cutting costs, it is not doing it as harshly as other countries.

Northern areas of the Eurozone such as the Netherlands and France are expected to catch up with Germany first, though it looks doubtful whether the southern countries will make real advance any time soon. Mads mentions that other countries outside of the Eurozone, such as the UK, should catch up fairly quickly as well. While the UK may see a weak first half due to the rise in VAT and the public spending cuts, the second half of 2011 should see a strong rebound.

The Eurozone economy video is available to view on the Saxo Bank TradingFloor website.

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Saxo Bank Releases Quarterly Outlook For Q4 2010

In its economic outlook for the fourth quarter of 2010, Saxo Bank recognises growing optimism in recent months due to a strong earnings season but the state of the US economy still overshadows these results. Saxo Bank, the trading and investment specialist, expects final sales to remain weak in the second half of 2010 and into 2011 and the unemployment rate to continue to hover just below 10% in the fourth quarter.

Commenting on the outlook, David Karsbøl, Saxo Bank’s Chief Economist said: “With the S&P 500 currently trading around the same level as it did at the beginning of the year, and with the lack of investments due to a weak housing market, the ongoing trouble in Southern Europe, and most developed economies, Saxo Bank fears that a cold front will stall, bringing more challenges and adversity going into 2011.”

Equities rely on the notion that the impressive earnings growth rates, recorded in earlier quarters, can be sustained. According to the Bank, the trouble is that earnings growth currently comes almost exclusively from one source: margin expansion, and while productivity gains can only take income to a certain level, sales growth must soon step up to the challenge.

The Bank predicts that spending at state and local levels remains a downward trend as policymakers scramble to balance their budgets. Despite the fact that the recession is generally perceived to have ended in the summer of 2009, it is still very much a reality at state and local levels.

“Double dip fears re-emerged over the summer as the deceleration in the US economy progressed as predicted in our 2010 Yearly Outlook. We expect growth to come to a complete halt in the fourth quarter of 2010 as consumption deleverages, the manufacturing sector will slow down, and investments will be negatively affected by the weak housing market. Unfortunately, the risk of a double dip, within the next few quarters, is substantial in our view.” Karsbøl added.

The Quarterly Outlook Q4 2010 focuses on the following areas: general market comment, macros forecast, FX outlook, equity outlook, commodity outlook and policy rates.

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Saxo Bank Acquires A 40% Stake In Initto

Saxo Bank, the online specialist in trading and investment, has announced the acquisition of a 40% stake in Initto, the Danish owned software and IT services provider. Initto has around 200 employees based mainly in India and Ukraine and the acquisition of Initto will enable Saxo Bank to continue to support and speed up the development of its trading systems.

Saxo Bank Acquires A 40% Stake In Initto

Designed to meet the varying needs and demands of financial investors and traders, Saxo Bank has developed four specialised and integrated trading platforms; the downloadable SaxoTrader, browser-based SaxoWebTrader, compact SaxoMiniTrader and phone-based SaxoMobileTrader.

Mikael Munck, CEO of Initto, commented: “Initto provides a wide range of customized IT services and software engineering solutions to clients. We have been very successful in offering and integrating our services into the organisation of our clients. We offer access to a wide range of international specialists that focus entirely on delivering high quality solutions to our clients’ allowing them to focus on core competencies, freeing up time for innovation and value creation. This is the secret of our success which we are certain Saxo Bank also will benefit from”.

Since its establishment in 2003, Initto has grown by an average of 50% per year and expects to enhance its service offerings with the support of Saxo Bank as a strong financial partner. Initto is headquartered in Ballerup near Copenhagen with a representative office in Oslo. Initto will continue to develop software and provide services to its existing client base.

In a joint statement, Kim Fournais and Lars Seier Christensen, Co-CEOs and co-founders of Saxo Bank, said: “We are thrilled to have acquired this stake in Initto, which has great synergies with Saxo Bank and fit perfectly with our business model. The acquisition is in line with our ambition to acquire fully developed businesses and utilize their expertise to develop and strengthen Saxo Bank’s products and services. Over the next few years, we will be working with Initto to further increase the value we offer our own clients. Initto’s current and future client base will also benefit from our commitment as client and shareholder. We want to remain a first class service provider and we believe Initto can help us achieve this goal.”

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Is An Investing Book Worth $799?

The author is not even dead . . . yet! Better to gain ‘know-how’ than gold. But is a book worth $799? An immodest ‘yes’. Sushi Zen Restaurant, Times Square – A statuesque, charming Senior Analyst for an Chicago-based investment journal magazine, showed me a remarkable sight on her laptop.

Incredible! But there it was. Imagine my astonishment when I saw used copies of my previous book The Profit-Taker Breakthrough; selling on www.amazon.com for the price of $799.00.

Is it a joke? Is it clever merchandising? You tell me. Certainly I confess to a twinge of pride. I was flattered.

The ‘Breakthrough’ . . . the proven, rapid, money-maker in good and bad markets . . . is the detailed ‘good news’ text and workbook for Profit-Taker Strategies.

The two entrepreneurs book sellers are highly regarded five star dealers – Motor City Books of Michigan and The David Bean Books of California. Good luck to them!

I was enheartened as a writer when The Chicago Tribune headlined their review to my book with the “PROFIT- TAKER: SOLID ADVICE ON THE STOCK MARKET”, but this is special. Selling my book at $799!

Although I’m 78 years old, I’m still committed to living. They forgot I’m still breathing.

In fact, on my SCOREBOARD on www.profittaker.info which is totally free and transparent, the annualized profits are registering up to 382%.

Like most authors, no doubt, I had a few new copies of my book lying around my study. So I added a current 2009 revision. Subsequently I placed them on www.Ebay.ca at the original price for the world to see.

Professor Don Abrams

Author and Inventor of the The Profit-Taker
www.profittaker.info
profsmarba@aol.com

Prof. Don Abrams is the author of a number of published financial books, including the international bestseller…The Profit-Taker: the Proven Rapid Money-Maker in Good and Bad Markets.

P.S. Notification of The Profit-Taker Breakthrough selling on the internet at $799.00 is located at:

http://www.amazon.com/gp/offer-listing/0969821603/ref=dp_olp

The $22.95 Version is located at:
http://books.shop.ebay.ca/?_from=R40&_npmv=3&_trksid=p3910.m38.l1313&

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New Forex Strategy To Strengthen Portfolios And Reduce Volatility

Trading Floor has unveiled a new Forex Portfolio Model created by Saxo Bank’s strategy team. The Portfolio model offers a way to reduce total portfolio volatility in the wake of the stock market rally that saw many investors turn away from Forex trading.

“Many investors are staying out of the Forex market – either because they lost money and have given up, or because they simply don’t know where to put their money,” said David Karsbøl, Chief Economist at Saxo Bank and Trading Floor commentator. “The Saxo Bank Forex Portfolio Model is a way of re-activating this idle money by applying them in a low-cost and relatively low risk fashion.”

The portfolio model is based on the Saxo Bank Fundamental Indices that measure the underlying economic strength (contraction or expansion) of 10 currencies: NZD, AUD, CAD, JPY, EUR, GBP, USD, CHF, SEK, and NOK. This should give a theoretical 45 possible currency crosses, but the model subtracts the12 most illiquid and expensive to trade and looks at 33.

The allocation signals are generated by the spreads in the fundamental indices and the idea is to always allocate more capital to the currencies with a relatively strong economic activity (and positive rate outlook) and fund the positions by going short on the currencies with weak economic activity (weak rate outlook).

The model allocates capital after changes in the spreads between the fundamental indices. For example, if the Eurozone Fundamental Index suddenly drops relative to the US Fundamental Index, the model (everything else being equal) would reduce exposure to EURUSD. Additionally, positions are scaled up or down according to the volatility of the currency crosses in question so that the expected risk-adjusted return for positions in EURCHF is the same as for positions in EURCAD.

“The model is always well diversified and is always in the market,” said David Karsbøl. “It is therefore not exposed to timing issues.”

The model doesn’t use stops, since the overall volatility of returns tends to be low (especially on single leverage). One particularly interesting feature is that returns tend to be almost completely uncorrelated to returns in stock markets (correlation = 0.1) and other risky asset classes (correlation to the CRB Index is 0.11).

In back testing since 1991, the model has produced annual returns of 5.34% using single leverage, 10.58% using double leverage and 15.67% with triple leverage.

“Therefore, if the back-testing is indicative of future returns, it would make a lot of sense to use part of one’s portfolio to allocate to the FX Model and thereby decreasing overall portfolio volatility without lowering returns too much or at all, depending on the leverage used.”

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Saxo Banque Wins Banking Innovation Award 2009

Saxo Banque, the French division of the online trading and investment specialist Saxo Bank, has been awarded the “Prix de l’Innovation 2009” (Banking Innovation Award), by the Investment Forum for its TradeMaker service. The innovative and free-of-charge service enables the bank’s customers to translate an idea into an order, to be kept informed of opportunities, and to compare results from trading ideas proposed by analysts.

The Award ceremony took place on 10th October at the Palais des Congrès, in Paris. Each year, a panel composed of financial journalists and editors from publications including La Tribune, Le Revenu and Investir are convened by the Forum’s organizers to present the innovation award. In the category of ‘Informed Investors’, the panel awarded the 2009 prize to Saxo Bank’s new TradeMaker facility.

TradeMaker was developed in response to two of the obstacles facing both futures traders and more general investors. Firstly, TradeMaker addresses the feelings of confusion that often arise from an overwhelming abundance of information. Secondly, TradeMaker facilitates the application of this information, allowing the investor to employ the resultant data in their trading.

TradeMaker publishes the results of proposed trading ideas. Customers can subsequently choose the issuer with the best performance for a given product. TradeMaker then uses text and graphics to explain trading ideas before pre-completing order forms which include such considerations as Stops and Limits. Relevant trade data, which is not always easy to assimilate, is translated into an order by the issuer. The customer need simply choose the value of his or her investment before validating the order with a click of the mouse. Advice, Trading Assistance and Transparency are the three major advantages of the TradeMaker tool.

Pierre-Antoine Dusoulier, CEO of Saxo Banque, declared: “It is a real honour for Saxo Banque to win an award such as this. It is reward in particular for our engineers who work hard all year on the development of new services to grow the platform and deliver increasingly innovative solutions to our customers. Saxo Banque is an independent bank, we create our own products by way of a dedicated technology research unit.”

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Positive Economy Growth For Late 2009 Predicted by Trading Floor Expert

Trading Floor columnist and Saxo Bank chief economist David Karsbol says the American economy will return to positive GDP growth in the second half of 2009; however, the reliance of the recovery on government spending and inventory re-stocking may mean the growth is not sustainable.

Karsbol says consumer deleveraging will continue and demand will remain subdued. US unemployment will continue to rise over the coming months, further hindering debt repayments and consumption.

Saxo Bank’s fourth quarterly financial outlook for 2009 is available for download on the Trading Floor site, which has been running since May 2009. Trading Floor gives daily and quarterly outlook and trading analysis of Forex, Equities, FX options, CFD trading, and commodities.

The Saxo Bank quarterly report is put together by the bank’s strategy team of chief economist David Karsbol, chief equity strategist Christian Blaabjerg, consulting FX strategist John Hardy and market strategist Mads Koefoed.

The quarterly outlook predicts that monetary stimuli and government deficits are likely to continue, leading to a ‘Japanisation’ of financial markets – higher price-to-earnings ratios and lower yields on both corporate bonds and treasuries.

Karsbol added: “Because Western economies are more flexible and able to embrace the necessary changes, we do not think that things will get as bad as was the case in Japan.

“However, it is increasingly evident that the current scenario in the West bears a close resemblance to post-1990 Japan, and it looks progressively like we have entered a new regime in which everyone assumes that large companies will be bailed out. This means that default risk is ‘priced out’, and we see higher price-to-earnings ratios and lower yields on fixed income.”

With maximum stimulus in the rear view mirror and austerity and exit strategies increasingly on the menu, Forex trading as a whole may begin to shift away from the rosier recovery projection that is already priced in. This could likely mean the exhaustion of many of the trends that are currently in place in FX, where so many trades are aligned along the ubiquitous risk appetite axis.

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The Japanization of Financial Markets

Saxo Bank predicts that monetary stimuli and government deficits are likely to continue, fostering a “Japanization” of financial markets, whereby the market will see higher price-to-earnings ratios and lower yields on both corporate bonds and treasuries.

Chief Economist at SaxoBank, David Karsbøl, commented: “Because Western economies are more flexible and able to embrace the necessary changes, we do not think that things will get as bad as was the case in Japan. However, it is increasingly evident that the current scenario in the West bears a close resemblance to post-1990 Japan, and it looks progressively like we have entered a new regime in which everyone assumes that large companies will be bailed out. This means that default risk is ‘priced out’, and we see higher price-to-earnings ratios and lower yields on fixed income.”

In its fourth quarter outlook, the Copenhagen-based investment specialist predicts that the American economy will return to positive GDP growth in the second half of the year, but warns that the sustainability of this growth is questionable and will be largely due to government spending and inventory restocking. US unemployment will continue to rise over the coming months, and that this will further hinder debt repayments and consumption.

David Karsbol believes a USD short seems to be a vote for the global recovery and has become the, newer and better carry trade. “The very low US’s yields and need for external financing and increasing reluctance from China to buy greenbacks is a toxic cocktail that could drive the currency even weaker in the near term,” Karsbol said.

Looking towards the end of the year, market dynamics indicate a shift from this year’s equity market rally. Global equity markets rallied 59% from the March lows through to August, and looking ahead, dynamics indicate a shift in performance towards micro trends and sector-specific growth and valuation stories.

Karsbol added: “Most indicators of economic activity are stabilising, but at very depressed levels. We believe investors should continue to take cyclical risk through regional allocations, with particular emphasis on emerging markets over Europe and the US, where it will be difficult to maintain and improve growth.”

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St Peter Port Capital Limited, An AIM Listed Investment Company Announces Its Preliminary Results For Its Second Year Of Investment

St Peter Port Capital Limited (the “Company” or “St Peter Port”), the AIM listed investment company whose aim is to generate value by investing predominantly in growth companies shortly before an initial public offering (“IPO”) or other exit event, announces its preliminary results for its second year of investment..

St Peter Port Capital Limited

Highlights

• 36 investee companies at year end

• realised to date, £22.5m in cash f r o m investee companies, generating a gain on investment of 39%

• following the year end, a further £5.67m invested in five companies, two of which are new to the portfolio

• NAV of 105.6p per share, up 3.1% over the year

• profit of £877,000 (2008: £3.69m), eps of 1.2p (2008: 4.9p)

Bob Morton, Chairman of St Peter Port, said:
“I am pleased to report that the Company has weathered the storm and maintained the net a s s e t value of the portfolio. We believe that many of the companies within the portfolio have considerable upside potential in a portfolio of high risk/high reward companies.”

Tim Childs, Chief Executive of St Peter Port Investment Management Limited, said:
“As at the 14 July 2009, we had £16.6m to invest in new opportunities and follow-on investments. Competition is limited and we are therefore being offered these on attractive terms.”

St Peter Port Capital Limited floated on AIM on 16 April 2007, raising £75m in new equity. The Company is a Guernsey registered closed-ended investment company. The Company’s objective is to achieve returns f r o m the uplift on or shortly after IPO, but the exit f r o m the investment could also be a trade sale. The universe for investment is principally companies across a broad range of sectors and geography expecting to conduct an IPO or achieve a trade sale or other liquidity event in the months after the Company’s investment. However, in current conditions, it may also include companies which are already public whose value is not properly recognised by stock markets. The initial focus is on companies targeting UK, US and Commonwealth stock markets although pre-IPO companies looking to float on other exchanges will also be considered. The Company appointed St Peter Port Investment Management Limited, a joint venture between Broughton Investments Group Limited (“Broughton”), a company in which Tim Childs is interested, and Shore Capital Limited (“Shore Capital”), the absolute return fund management specialist which currently manages approximately £1.4 billion, to act as its investment manager (“the Investment Manager”).

Learn more about Shore Capital :
Google: Shore Capital share price info –
Linkedin:Shore Capital information –
FT: Shore Capital Profile –
Puma Hotels:Shore Capital

Chairman’s Statement

Introduction

Although our second year of investment was a year of unprecedented difficulty for financial markets around the world, I am pleased to report that the Company has weathered this storm well. It has maintained the net a s s e t value of its portfolio which includes a number of companies with considerable upside potential.

Investment Environment and Portfolio Composition

St Peter Port was relatively fully invested at the start of 2008/9, having invested most of the funds raised at flotation in the previous year. A number of companies in which we had invested were coming to market shortly or otherwise close to a liquidity event such as a trade sale. The portfolio accumulated in the first year was weighted its towards three sectors: oil and gas exploration and production; mining and resources and renewable energy/clean technology, reflecting suitable opportunities which had been identified for St Peter Port’s strategy. At the start of 2008/9 St Peter Port held stakes in 41 companies.

During the earlier part of 2008/9, commodity prices remained high, giving rise to a number of flotations and other exit opportunities. Wherever possible, as described in the report below, the Investment Manager took full advantage of these to release cash. Over the same period the Company redeemed nearly all its hedge fund holdings other than one much reduced holding in a third party fund of funds which has staged redemption arrangements. However, after the banking crisis became extreme in September 2008 the opportunities for achieving exits vanished and only began tentatively to return since the year end.

Given the extent of the turmoil in financial markets, and its impact on the global economy, the Company refrained f r o m making any further investments in the second half of 2008/9. This reflected the conditions for a number of months in which markets – were unable to find any sort of equilibrium.

Investments and Realisations during the Year

During the first half of 2008/9, the Company invested a further £14.9m in nine companies, two of the investments being follow-ons. The focus of these investments shifted f r o m a possible exit through flotation to investments where there was a credible expectation of a liquidity event in any form within a relatively short period, such as a trade sale or repayment of a loan.

To date the Company has realised over £22.5 million through disposals (over £22 million in 2008/9), generating a gain on investment of 39 per cent. This was largely derived f r o m six investments which were wholly or substantially realised during the year and one other which was partially realised.

Share Buy-Back

Shortly before the year end the Company bought back 1.95m of its own shares at 30p per share. These shares are currently being held in treasury. As discussed below, the effect of this buy-back was to enhance net a s s e t value per share.

Basis of Valuation for Financial Results

Determining the Company’s financial results for the year is an exercise largely dependent on an assessment of the fair value of each investment held. Where investments are now quoted, there is an external basis for determining fair value and we have valued holdings at the bid price of the shares. Where this is not available IFRS rules require us to select a fair value.

Values of our oil and gas and resource stocks are influenced by a number of factors, including company progress, exchange rates and commodity prices. Where we have invested in a mining or petroleum project, when the company receives positive results f r o m drilling geological investigation this should lead to a rise in value. We report in sterling but many of our investments were made in foreign currency. Even where this was not the case, the value of the investment is frequently determined by reference to dollar values rather than sterling. We have also taken account of any pre-defined uplift on a liquidity event; in some cases we have written investments down heavily and in others written them up.

Financial Results

The Company made a profit in the year of £877,000 (2007/8: £3.69m), generating earnings per share of 1.2p (2007/8: 4.9p). Income arose largely f r o m the net gains in fair value of investments of £2.51m (2007/8: £4.57m).

Net a s s e t s at year end were largely unchanged f r o m the previous year at £77.13m (31 March 2008: £76.84m). However, net a s s e t value per share increased by 3.1 per cent to 105.58p (31 March 2008: 102.45p), largely as a result of the share buy-back.

Balance Sheet

As at 31 March 2009, the Company held £54.3m in investments in companies, being equity investments and loan instruments (31 March 2008: £55.9m). Nearly all of the remaining balance sheet was in cash, £22.6m (31 March 2008: £12.5m – including commercial paper), the principal difference being that £8.7m was held in hedge funds at 31 March 2008, which was reduced to £130,000 at the year end.

Activity since the Year End

Since the year end conditions have become more stable and the Company has resumed making new investments, described below in the Investment Manager’s report. Three of these investments are follow-ons into companies in which we were already shareholders and the other two are new investments. The pricing of each of these reflects the depressed market conditions which currently prevail and offer the prospects of significant uplifts on exit.

As a result of these investments since the year end, the Company, as at the 14 July 2009, held £16.6m in cash and available for investment. We therefore have the cash to cherry pick f r o m the best of our existing portfolio and new opportunities at a time when many potential participants are illiquid.

The investment climate has become less volatile and commodity prices have recovered substantially since their lows around the turn of 2008. Competition in our area f r o m other funders is limited. We believe that many of the companies within the portfolio have considerable upside potential in a portfolio of high risk/high reward companies. The Board views the future with confidence.

Bob Morton
Chairman

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Securities Based Funding, Inc. Announces A Unique Financing Advantage To Borrowers Against The Value Of Their Securities Portfolio

Securities Based Funding, Inc. announces a unique financing advantage to borrowers against the value of their securities portfolio at below-market, simple interest, fixed rate loans ranging from 2.5% to 4.5%. These non-recourse loans will assist buyers, sellers and developers of properties worldwide. The loan proceeds can be used for any purpose except to buy securities or carry securities in a margin account.

Securities Based Funding, Inc.

Despite the credit crunch and while access to liquidity through traditional capital markets is difficult in today’s uncertain economy, security-based loans enable borrowers to access liquidity at below-market rates by pledging the securities they own as collateral for the loan.

Eligible securities are publicly trades stocks, bonds, tradable mutual funds, unit investment and real estate investment trusts as well as foreign positions on international exchanges. Ineligible securities include, privately held stocks, securities held in retirement accounts, such as, IRAs and 401Ks. The borrower retains all upside market appreciation and receives any dividends or interest to which the securities are entitled. Loan to security values (LTV) range from 35% up to 80%. The more liquid and actively trades the securities, the higher the LTV.

Securities Based Funding, Inc. represents a full-service, private, nonpurpose, direct lender that specializes in securities-based lending with investors in need of prompt funding. Terms are based on the evaluation of the risk and future performance associated with the stocks, bonds or U.S. Treasuries to be pledged as collateral to maximize and maintain complete yet proprietary flexibility of the equity-loan process.

Successful stock-lending transactions have been executed involving the American Stock Exchange, NASDAQ National Stock Market, NASDAQ Small-Cap Stock market, New York Stock Exchange, Over-the-Counter Bulletin Board and foreign exchanges.

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Equity Mix Remains Top Choice For Pension Investments

Prudential has reported that more than one in three people retiring within the next 10 years say they would prefer their pension to be invested partly in the stock market and the remainder in other types of investments, according to new research*.

Equity Mix

The nationwide study shows that consumer confidence in the stock market continues despite recent market and economic upheavals.

Prudential asked 1002 men aged 55 to 64 and women aged 50 to 59 who have a pension how they would want their pension fund invested if they could choose:

– 35% said partly in the stock market and the remainder in other investments (40% men, 29% women)
– 29% said only in cash or very low-risk investments (29% men, 30% women)
– 22% said they did not know (18% men, 28% women)

Since the FTSE 100 index of leading shares hit a five-year low of 3530 in the week of 2nd March this year, it has climbed back up. Currently the FTSE is at 4615 w/c 27 July 2009, compared to 4413 w/c 26 July 2008 so is 202 points higher than this time five years ago.**

Andy Brown, Prudential’s director of investment funds, said: “Despite immense volatility in the stock market over the past year or so, there is still evidence of consumer confidence in equities to deliver a promising return for pension investments over the long-term.

“What is certain as well is that many people have been spooked by the recent economic maelstrom and, unsurprisingly, would prefer their pension to be in cash or lower risk investments as they near retirement.

“We’ve seen a marked increase in the numbers of people looking for a home for their money which they can trust, knowing that it has a solid capital base and a long-standing history which will stand it in good stead for the future.

“I think investors can feel confident in stock market opportunities if they are given a decent choice in how they access real assets such as the equity market. Investors can really capitalise on the markets if they can access funds across a number of asset classes and sectors from a range of different investment managers allowing diversification across assets and manager styles.”

* Survey conducted by Research Plus among 1,002 UK males aged 55-64 and UK females aged 50-59 between 23 and 30 April 2009 using an online methodology
** Source: Yahoo finance FTSE 100 charts – correct as at date of issue: 27th July 2009

About Prudential:
“Prudential” is a trading name of The Prudential Assurance Company Limited, which is registered in England and Wales. This name is also used by other companies within the Prudential Group, which between them provide a range of financial products including life assurance, savings and investment products, such as a bond investment and pensions, including advice on company pensions.

Registered Office at Laurence Pountney Hill, London EC4R 0HH. Registered number 15454. Authorised and regulated by the Financial Services Authority.

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