WorldWide Markets with Simon Brown

Commodity Market Analysis Oil prices are on the rise, currently trading around $89 per barrel, indicating both demand and supply factors at play. Factors affecting oil prices include supply disruptions from Russia and Saudi Arabia's production cuts through OPEC+. Concerns about inflation are reflected in the rising price of gold, which is currently trading at all-time highs above $2300 per ounce. Despite uncertainty, inflation is not expected to decrease soon, especially with increasing energy costs Discussion on the delayed rate cuts by the US Federal Reserve and the global outlook on inflation. Implications of Goldfield's Chilean Mine Production Goldfield's Chilean mine is expected to produce gold at significantly reduced costs in the coming years, potentially impacting global gold supply. Analysis of the time taken for new mines to commence production, highlighting the challenge of meeting future demand. Tax Collection Insights from SARS SARS reports an additional R10 billion in tax receipts, contributing to a total of R1.7 trillion in tax collections. While individual tax collections saw an increase of 8.2%, company tax declined by 9%, reflecting challenges faced by various sectors, including retail and mining. Performance Review of ETFs (full list here) Top performing ETFs in the first quarter of 2024 include those focused on international markets, particularly in technology and Japanese sectors. Conversely, local ETFs, especially those tied to South African markets, experienced declines. Analysis of factors influencing the performance of specific ETFs and their compound annual growth rates (CAGRs). Simon Brown

Old Mutual Results: Surprisingly strong results from Old Mutual. Despite stagnant GDP growth and population decline, Old Mutual shows strong growth, indicating market share acquisition. Expansion into banking sector questioned due to market saturation. Stock analysis: Trading around 1184, showing potential support at 1150 and resistance at 1240-1280. Considered cheap with PE ratio around 7.7 and dividend yield over 7%. Market consensus predicts an average price target of 14.81. Skepticism remains regarding the bank launch and overall upside potential. MTN Results and Analysis: MTN's earnings affected by Naira devaluation in Nigeria. Earnings per share down 72%, impacted by tax issues and currency devaluation. Stock analysis: Chart showing positive signs, with potential for short-term growth. Market consensus includes three strong sells, five holds, and four buys. Telco sector struggles due to price pressures and constant capital expenditure. Limited upside potential for telco stocks, including MTN. ADvTech* Results and Operational Leverage: ADvTech demonstrates strong operational leverage. Operational margins increase due to improved student occupancy rates. Revenue up 13%, HEPS up 19%, and dividend per share up 45%. Stock analysis: Notably increased in value but still offers potential growth. Expectations for around 15% growth in the future. Simon Brown expresses satisfaction as a long-term shareholder in ADvTech. Monetary Policy Committee (MPC) Meeting Insights: MPC meeting concludes with no change in rates. Governor's hawkish stance indicates possible rate cuts later in the year. Inflationary pressures expected to persist due to global factors. Delayed rate cuts expected due to inflation concerns. SALTA Awards Highlights (full details here): Simon Brown attends the SALTA Awards. Satrix emerges as the big winner with 10 awards. People's Choice Awards highlight popular ETFs, with Satrix Top 40 winning for the seventh consecutive year. Introduction of a new award category for foreign ETFs. Importance of industry events in highlighting the significance of ETFs and listed trackers. Simon Brown * Simon holds ungeared positions.

Market Updates: Recent news on Markus Jooste's fine and tragic passing prompts reflection on justice and mental health awareness. Telkom's sale of its towers business for R6.75 billion highlights strategic shifts and potential opportunities in the telecom sector. Ongoing rise in oil prices raises concerns about inflationary pressures and global economic impacts. Market Analysis and Insights: Gold's Surge: Gold prices hit new all-time highs above $2200, reflecting investor concerns and market sentiment following Jerome Powell's recent statements on inflation and monetary policy. Gold mining companies show varied responses, with Pan-African, Goldfields, DRD, and Anglogold Ashanti experiencing gains. Interest Rates and Economic Outlook: Powell's announcement of no immediate rate cuts and a projected total of three cuts for the year signals a cautious approach towards inflation. Rising interest rates pose challenges for companies with significant debt burdens, while those with ample cash reserves stand to benefit. Inflation and Monetary Policy: CPI data reflects higher-than-expected inflation rates, prompting speculation about potential rate cuts in South Africa and implications for economic recovery. Abenomics, Japan's economic policy experiment, demonstrates the effectiveness of unconventional monetary measures in stimulating growth and combating deflation. Company Updates and Reflections: Remgro Results: Remgro's net asset value growth raises questions about the effectiveness of its management strategy, despite trading at a significant discount. Remgro has grown its NAV per share by 5% p.a. since 2010. Over the same period, the ALSI TR index has done 12% p.a. If you expect this underperformance to continue (and nothing in their recent capital allocation decisions indicates otherwise), then a fair discount to NAV is… — Piet Viljoen (@pietviljoen) March 19, 2024 Contrasting performance with Sabvest Capital highlights the importance of superior returns and effective capital allocation in investment decisions. Sun International: Strong financial results from Sun International underscore challenges and opportunities in the leisure and hospitality sector, amid shifting consumer behaviors and economic uncertainties.

Retire well, we're chatting with retirees about what they've learnt and any tricks they can pass on. US Inflation Trends: US inflation has remained stagnant at 3.2% since June of the previous year, defying expectations. Despite initial projections, inflation has not reached the anticipated 4% mark, staying just above 3%. Discussion on potential implications for the economy and monetary policy, including the possibility of a mid-year rate cut. Local Property Market Concerns: Review of recent challenges facing Pick n Pay and its impact on property stocks and landlords. Analysis of Hyprop's trading update and its implications for the broader property sector. Discussion on potential strategies for landlords facing challenges from tenant closures and renegotiations. Quantum Food and Market Speculation: Examination of recent market speculation surrounding Quantum Foods and its stakeholders. Evaluation of market reactions to news events and projections for future stock performance. Get 10% off your first KoyFin order Financial Sector Insights: Analysis of ABSA's poor financial results and the broader challenges facing the banking sector. Comparison of valuation metrics and performance across various banking stocks. Preview of upcoming industry event focusing on financial education and market insights.

Shoprite* Results and Market Comparison Discusses the recent Shoprite results, emphasising excellent performance against a high base. Highlights Shoprite's significant CapEx spending, customer savings, and market share gains. Compares market cap of Pick n Pay and Shoprite, pointing out the latter's cash reserves. Reflects on the historical revenue comparison between Shoprite and Pick n Pay over the past 20 years. Shoprite's Competitive Position and Stock Analysis Questions whether Shoprite is always destined to be an expensive stock. Analyzes the current PE ratio, forward PE, and 10-year mean, suggesting that the stock may not be as expensive as perceived. Shares consensus forecasts and target prices for Shoprite, indicating a potential undervaluation. Expresses the belief that Shoprite at ±R270 might not be as expensive as it appears, drawing parallels with the valuation of Nvidia. Shoprite's Success Factors and Pick n Pay's Struggles Explores the factors contributing to Shoprite's success, including central distribution centers and efficiency. Contrasts Shoprite's strategy with Pick n Pay's challenges, noting a decline in consumer satisfaction. Mentions Pick n Pay's recent financial struggles, including a rights issue and debt increase. Gold and Bitcoin at All-Time Highs Addresses the unusual situation of both gold and Bitcoin reaching all-time highs simultaneously. Discusses the fears driving gold prices, such as inflation, interest rates, conflicts, and global elections. Highlights gold's potential target of $2,500 and the positive impact on gold mining profits. Shares the performance of various gold mining stocks over the past three years. Canal+ Offer for MultiChoice Updates listeners on Canal+'s revised offer of R125 per share for MultiChoice, which is currently trading at R113.50. Discusses the time value and risk value of the deal, expressing the view that this might be the final offer. Finance Costs and Corporate South Africa Examines the increase in net finance costs for Sea Harvest, attributed to higher interest rates. Acknowledges the challenges faced by Corporate South Africa, including Eskom issues, logistic challenges, and rising interest rates. Assures listeners that some of these challenges may start to fade away in the future. * Simon holds ungeared positions.

Nikkei 225 reached a new all-time high after 35 years Historical context: peaked in December 1989, 82% drawdown by March 2009. Factors contributing to the 80s crash: Yen protection, low rates, speculative bubble. Current challenges: aging population, economic complexities, recent inflation. Investment options: Sygnia JP (SYGJP) - JSE-traded, and Investec's structured product. Warren Buffett's Annual Letter Warren Buffett's annual letter to shareholders released. AGM scheduled for May 4th, details about screening yet to be announced. Historical and informative; available on BerkshireHathaway.com. City Lodge Results City Lodge results: Revenue up 10%, dividend up 20%, HEPS up 10%. Occupancy at 61%, pricing power at 65%. Challenges in margins due to increased focus on food and beverage. Comparison with other hospitality stocks: Sun International, Southern Sun. MultiChoice Canal+ Offer Canal+ acquires 35.01% of MultiChoice voting rights, triggering a mandatory offer. Takeover Regulation Panel ruling. Speculation on Canal+ offer price, potential sweetening of the deal. Bitcoin and Bitcoin Halving Bitcoin trading around $59,884, near all-time highs. Upcoming Bitcoin halving in April and its potential impact. Local perspective on Bitcoin and its role in the market. Bitcoin in ZAR trading over a million, emphasising its volatility. Discussion on Bitcoin's market cap compared to traditional stocks. Pick n Pay* Update Pick n Pay's disappointing update: debt doubled, sales going backward. Market's negative reaction reflected in the stock price. Potential exit strategy if weekly close falls below 2022. * Simon holds ungeared positions.

Budget 2024 panel. For the last many years AJM Tax has done a post budget panel which includes Simon Brown and this year was no different. Hosted in Cape Town the panel was; Karyn Maughan, senior legal journalist at News24 Dr Albertus Marias, Director AJM Tax Azhar Varachhia, Managing director Alpha plus Capital Simon Brown, Just one Lap and MonewebNOW Below is the AJM Tax one pager of budget highlights.

Pick n Pay* Chart Analysis Resistance zone around 26, potential to touch 26.70 Higher highs, higher lows, horizontal resistance Target: 30 bucks to fill the gap Comments on Pick n Pay's potential under Sean Summers No need for a rights issue, potential market spook if it happens Simon's position: Started building, considering more Current status: Down 1.7%, trading at 25.30 Pick n Pay close 13Feb24 (daily) Transaction Capital and WeBuyCars Transaction Capital planning to list WeBuyCars Unbundling process expected in March Valuation: 7.5 billion rand Key information: Founders' put option on Transaction Capital is off the table WeBuyCar's strong performance in January with a record 14,000 cars sold Market Cap of Transaction Capital: R6.5 billion Opportunities and challenges in SA Taxi business Overall assessment: Looking not too bad Current stock level: 850c Expectation of pro rata shares for Transaction Capital holders Timing details expected in the circular Gold Price Movement Gold weaker despite US and UK inflation data Current gold price and chart analysis Simon's position in Anglogold Ashanti* Observations on unexpected weakness in gold price after inflation data Gold daily chart 14Feb24 Canal+ Offer for MultiChoice MultiChoice facing a 105 rand Canal+ offer Market sentiment: Canal+ likely to come back with a better offer Current stock price: 104.63 Speculation on possible offer prices: 120, 135, or even 160 Market confidence in Canal+ making a mandatory offer Global Market Trends and Dollar Strength Dollar strength in global markets DXY trading at 104.87 Money flowing into the US due to fear and concerns Impact on Rand: Trading at 19.07 Market skepticism about inflation concerns DXY (US$ index) 14Feb24 (daily chart) Inflation Analysis Recent US and UK inflation data Market reaction to inflation numbers Central bank concerns about reaching inflation targets Jerome Powell's cautious approach and potential rate cuts Local inflation expectations and potential rate cuts in South Africa The challenge of getting back to the inflation target * I hold ungeared positions.

Disney results: Last week's big story was about tech, starting with Disney, a stock recommended here back in September at ±$80. Key financials: Linear networks revenue up 9%, Direct-to-consumer up 12%, Parks up 16% Direct-to-consumer still incurred a loss of $400 million Consumer products, content sales licensing, and ESPN performance discussed Overall, not a knockout result but not terrible; I remain a satisfied shareholder Big move in streaming sports! ⚾️🏀🏈 Disney, Warner Bros., and Fox are joining forces to create the ultimate sports streaming app, merging ESPN, TNT, and Fox Sports (WSJ). ESPN alone was 18% of Disney's latest quarter revenue.$DIS $FOX $WBD pic.twitter.com/xSPBko0cMO — App Economy Insights (@EconomyApp) February 6, 2024 Meta (formerly Facebook) Earnings: Advertising revenue up 24% year on year to 38.7 billion Other segments discussed, including Reality Labs (MetaQuest) Net profit $14 billion, up 35%; stock surged 20% Mark Zuckerberg's dividend income from the declared 50-cent dividend discussed Positive sentiments about Meta's performance, particularly in comparison to other tech giants Canal+ Offer for MultiChoice: Canal+ made an offer for MultiChoice at 105 Rand per share Market reaction, initial excitement, and stock movement Simon's caution about potential risks and timing of the deal MultiChoice's response: Board concluded the offer significantly undervalues the group Canal+ continued to buy MultiChoice shares, now owning 35.1% Discussion on the mandatory offer threshold and potential scenarios Regulatory considerations: Foreign ownership rules and competition commissions The price of the mandatory offer must be equal to; (i) identical to, or where appropriate, similar to the highest consideration paid by the bidder for those acquisitions and (ii) accompanied by a cash consideration, at not less than the highest cash consideration paid if the shares that carry 5% or more of the voting rights were acquired for cash. Simon's conclusion: Canal+ likely to succeed, potential challenges, and market dynamics Simon Brown

Breaking News: Canal+ Offer for MultiChoice: Canal+, French TV business, offers 105 rand per share for MultiChoice minorities. Synergies between the two businesses. Legal considerations regarding foreign media ownership. MultiChoice closed at 75 rand; market likely to respond positively. Market Updates: Hyprop reports positive festive trading for its tenants. Transaction Capital plans to list WeBuyCars in March; potential value unlock. Evergrande declared bankrupt with over 300 billion dollars in debt. Hong Kong economy expanded 3.2% in 2023. China overtakes Japan as the world's top car exporter. Cristal Challenge Stock Picks: Richemont*: Luxury brand with potential in a recovering economy. [caption id="attachment_41062" align="aligncenter" width="849"] Richemont weekly chart close 31Jan24[/caption] Calgro M3*: Debt under control, potential dividend, well-managed company. [caption id="attachment_41063" align="aligncenter" width="849"] Calgro M3 weekly chart close 31Jan24[/caption] AngloGold Ashanti*: Gold as insurance; geopolitical concerns. [caption id="attachment_41061" align="aligncenter" width="849"] Anglogold Ashanti weekly chart close 31Jan24[/caption] Zeda: New listing, unbundling, potential growth. [caption id="attachment_41065" align="aligncenter" width="849"] Zeda weekly chart close 31Jan24[/caption] Mr. Price*: Positioned well in the retail sector, positive trading update. [caption id="attachment_41064" align="aligncenter" width="849"] Mr Price weekly chart close 31Jan24[/caption] Closing Remarks: Reminder to sign up for email alerts before live sessions. Host: Simon Brown * Simon holds ungeared positions. Host: Simon Brown Date: 1 February 2024

dd Introduction: JSE Direct Episode 571 for January 25, hosted by Simon Brown. Simon introduces the idea of transitioning the podcast to a live format using Riverside, allowing viewers to see charts and interact during recordings. Market Updates: Richemont*: Stock surged 10% on better-than-expected trading update. Identified as an opportunity last year when it pulled back to R2,500. Trading at R2,653 at the time of the recording. AVI: AVI delivered a strong update, but struggling with I&J. AVI focuses on defending margins, willing to lose volumes for profitability. Potential sale or listing of INJ discussed. Woolies*: Mixed trading update. Struggles in Australia, especially with David Jones, while food segment remains strong. Concerns about the performance of the clothing segment. Clicks: Mostly a strong update, struggles in UDP (wholesale drug distribution). Selling price inflation averaged 7.5%, higher than the previous period. Clicks achieved highest-ever daily sales in late December. Economic Updates: December spending records discussed with BankserveAfrica. Expectations for rate announcements from local and European central banks. Hawkish tone expected from local governor; questions about Jerome Powell's stance. Global Market Highlights: All-Time Highs: S&P 500, Nasdaq, Dow Jones hit all-time highs. Russell 2000 still 20% off its highs, considered in bear market territory. India's stock market surpasses Hong Kong, becoming the world's fourth-largest share market. China in trouble, is it over? Should we be worried? Simon reflects on recent data and developments in China. Population decrease and aging population noted. Speculation on a potential $278 billion spending spree to support the market. Concerns about state-directed capitalism and common prosperity policies. Recent crackdowns in gaming, education, and potential implications for healthcare. China's focus on national defense and potential impacts on Taiwan. China's shift towards a more inward-looking and self-focused path. Conclusion: Speculation on the impact of China's changes on global growth, commodity prices, and investments. Simon announces plans to start recording the podcast live, with notifications on social media and newsletters. Acknowledgment of the podcast's longevity (571 episodes) and a request for reviews. Closing: Simon Brown signs off, encourages reviews, and mentions future live recordings. Reminds listeners to take care of themselves and others. * Simon holds ungeared positions.

In this episode of JSE Direct, Simon Brown discusses various market topics, including the bleak outlook of the Hang Seng Index due to Chinese GDP results. Positive news for Grindrod with the Maputo Port Development Company's impressive performance. The rise in uranium prices driven by increasing demand for nuclear power plants, he found two US listed ETFs benefiing from this trend. [caption id="attachment_40966" align="aligncenter" width="849"] Spot uranium price[/caption] The approval of 11 Bitcoin ETFs by the SEC. When does the JSE get a crypto ETF? Do elections matter for markets? Upcoming elections in 2024 across 70 countries. Simon explores the question of whether elections truly matter for investors, emphasising historical examples where market reactions were short-term and highlighting the importance of focusing on long-term investment strategies amid political volatility.

Now for the eleventh year in a row, we kick off the new year with a prediction show. Marc Ashton, Keith McLachlan and Simon Brown put their heads on the block with three wild and woolly predictions for the markets for 2024 followed by a call on the Top40 and ZAR for the year ahead. Importantly we start each show with a review of the previous year's predictions and you'll find the 2023 predictions show here.

Position your portfolio for 2024. Top local ETFs for 2023. Simon Shares Transaction Capital (JSE code:TCP) results swung into a massive loss, no surprise. SA Taxi loss making but overall H2 was better then H1 in all three divisions. Purple Group* (JSE code: PPE) results also swung into a loss. But as a discretionary consumer business, why is everybody so surprised? Average client has 1.45 products. This seems low, very low. Philippines not yet regulated, but they not giving up. Project delays. Tigerbrands (JSE code: TBS) show a tough environment and RFG (JSE code: RFG) may offer better value. Local Q3 GDP at -0.2%. Gold at all-time highs. Charts by KoyFin. Get 15% off a two-year subscription * I hold ungeared positions. Simon Brown

Share buybacks and stock compensation, the bad and the ugly Share buybacks are good right? The company uses their free cash to buyback shares which reduces the number of remaining shares such that each share has a higher claim over future profits which adds to their value. Further they're tax efficient in that paying dividends results in dividend tax. BUT; Firstly, in cyclical stocks you need to be buying back at lows, not highs and the companies usually have no free cash at lows, so either they don't buy back or they do so at highs when they have the cash. Horrid value destruction. Secondly, some companies are buying back but also issuing new shares to staff, at times at a rate faster or similar to what they're buying back. This is then effectively an underhand salary to staff. This is especially an issue with large tech stocks, see examples below. Thirdly, new share issues are considered non-cash, but ultimately they are cash as you gave somebody real shares that have future claim on profits. Fourthly, often acquisitiosn are done with stock increasing the outstanding shares. Many will see this as a free deal as shares don't cost. But they do cost as they reduce every other shares value and if the company has been buybacks, well then they paid cash for those shares, just indirectly. Locally we do see buybacks, but share issues are relatively small so the impact is less shares and more value per share. Using IFRS accounting diluted HEPS uses the share count of all outstanding shares PLUS all promised shares not yet delivered. These are basically options that could become shares and gives a way better reflection of the profit, even thugh not yet issued they will potentially come to makret and be issued. Apple (Nasdaq code: AAPL) has been buying back shares and as such over the last decade it's outstanding shares is down about 38%. Apple shares outstanding Meta (Nasdaq code: META) has also been buying back, but they also issue shares at such a pace that over the last decade shares outstanding is basically flat. Meta shares outstanding Charts from Koyfin 15% discount for first 2 years Simon Shares US October CPI was 3.2%, down from 3.7% in September (after peaking at 9.1% in June 2022) and markets absolutely loved the data. Expectations for Fed rates is now no more raising and cuts starting maybe as soon as the 19-20 March or 30 April - 1 May meeting. Shoprite* (JSE code: SHP) trading update shows they still knocking it out of the park and taking market share. Woolies* (JSE code: WHL) trading update had more excuses tha a five-year old caught eating all the picnic ice cream. Decent Stor-Age* (JSE code: SSS) results with ±10% yield and discount to NAV of ±25%. The yield is nice, but you can get the same in cash right now. But when rates start coming down the yield is more impressive and lower rates could see higher valuations. A global luxury ETF Simon Brown

The problem with telcos I have long said that telcos such as MTN (JSE code: MTN) and Vodacom (JSE code: VOD) is that they are essentially utilities and should be priced as such. But actually that statement is wrong. Sure voice (who still calls using voice?) and data are utilities like water and electricity. BUT the telcos have a problem, capex. Yes we're using more and more data but prices keep coming down, I recently bought an effective 80 GB for little over R400. And all that while capex is increasing. They're busy rolling out 5G but as soon as that's done it'll be tine for 6G. It's a never ending tread mill. Simon Shares Brent oil is weak and telling us a story about global growth Clicks (JSE code: CLS) vs. Dis-Chem (JSE code: DCP) results contrats. REITs unloved and cheap, time to buy? Simon Brown

Updating minister Gordhan's portfolio Public Enterprises Minister Pravin Gordhan has declared his holdings, we reviewed his portfolio last time in April and there are some interesting changes, he is fairly active in buying and selling. Most notable is the total value is up almost R2million? Simon Shares Purple Group* (JSE code: PPE) have introduce a platform fee. Certain behaviours will see the fee waived and I speak to Charles Savage on my MoneywebNOW show Thursday morning. Renergen* (JSE code: REN) results show a loss, LNG output for phase 1 ±40% and helium on stream by year end. Phase 2 has been split into two parts and the conditions of the $750million is not a Nasdaq listing but rather a capital raise with a listing for part two of phase 2. MTBPS was bleak as expected and we could see some tax hikes in February. Gold almost had its highest ever monthly close for October. * I hold ungeared positions.

Living small, an update Back in 2017 Simon and his wife down scaled into a small (relative) apartment and also got rid of one of their cars again. As they now move again Simon updates in their experience of living small. Simon Shares Famous Brands (JSE code: FBR) results. Revenue up and HEPS lower. TigerBrands (JSE code: TBS) loses their CEO and posts a decent trading update. Jamie Dimon said central banks' forecasts have been "100% dead wrong". Sasol (JSE code: SOL) trading update, lots of movingp arts, but the market not trusting management? That said stock is cheap and we're seeing some upward movement on price.

hh Renergen* (JSE code: REN), now what? Late September the price started breaking down and end September a Tweeter started posting about them. I'm not going to defend every point raised, that's the job of the company and after an initial poor response, Monday saw a more detailed SENS. Paid research. Ultimately all research is paid for. Sometimes it is paid for by the company and here the issue is disclosure. I think the bigger issue is a complete lack of disclosure in our industry. By FinTwit or the fancy analysts, albeit assume the latter is always talking their book, which is fair. Perhaps the biggest point from this last few weeks is; Know your stock. Like really know it. When I buy a new holding I put together a lis of 3-5 things I like and 3-5 risks. I may be wrong on any of them, but it makes me do the digging and at least have a decent view of both sides of the story. Careful of "new" news. It may be accurate (or it may not), but it also often lacks detail which maters. This was mostly the case with the Twitter news on the stock. Now what for Renergen Results next Friday. LNG is flowing. Helium is not, but company has said they expect the leak repaired this month. In short they are in the same place as they were before all this started. BUT. They need to do a US capital raise and list in the Nasdaq. A low share price makes this much more dilutive. How this will play out I have no idea. I hold and continue to hold Renergen*. It was never going to be smooth sailing and the risks are real. Yes they have the gas and helium in the ground, phase one is half working but phase two is large, complex and expensive with real risks. Simon Shares Middle East war could get really bad for inflation and rates if oil prices rise markedly. Decent Calgro M3* (JSE code: CGR) results. Horror Pick n Pay (JSE code: PIK) results. Local ETF total returns over the last five years. * I hold ungeared positions.

There are bold traders. here are old traders. There are no bold and old traders.Bold traders What is a bold trader and why do they die out? Wild swings for the fence No position size management Stop loss for losers Enter outside of system and process Simon Shares Famous Brands (JSE code: FBR) trading update, Spur (JSE code: SUR) really has taken the mantel of best QSR/restaurant business on the JSE. Very strong US jobs and upward revisions from previous month. But wage inflation only 0.2%. So market was confused but ended happy. Tuesday also saw US 10-year yields moving lower which excited everybody. But I am sceptical, this is only one data point and I think the FOMC hikes at their 31 Oct/01 Nov FOMC meeting. Water crisis. This is going to hurt and it not going away any tine soon. Which businesses get hurt most? We found a US government bond ETF paying monthly.

US 10-year yields highest since 2007 Bad news all round (unless you buying). Almost 40% of US government debt expires in the next four years and will be re-issued at markedly higher rates, 9x higher in some cases. Money flowing into US bonds for yield. This sees less money entering the stock market Sees a stronger US$ (check DXY strength, all currncies weaker against US$) Hits valuations lower as higher rates makes cash worth less in the future, but so far the market has ignored this fact. Simon Shares The Top40 closed negative for the year on Tuesday. This after being almost +12% in late January and trading at all-time highs. Top40 close 26 September 2023, negative YTD Fed and SARB hold rates steady - but very hawkish. StatsSA "South African hotels recorded an occupancy rate of 47.3% in July 2023, up from 45.8% in June and 45.5% in May.". But still below the ±50% pre-pandemic occupancy levels.

Simon Shares Shoprite* (JSE code: SHP) results "2023 was extraordinary". Chart by Koyfin 15% discount for first 2 years Richemont (JSE code: CFR) getting interesting, let's see if support holds. [caption id="attachment_40005" align="aligncenter" width="849"] Richemont weekly ~ 07Sep23[/caption]Nampak (JSE code: NPK) nil paid letters are trading, code NPKN. Remember either sell them or take up the rights. Calgro M3* (JSE code: CGR) trading statement, HEPS +20% for the first six months ending August. The latest PMIs out of Europe all quite weak, not only declining from the previous month, but lower than the preliminary numbers from the middle of last month Profit from the Longevity Boom with Healthcare ETFs The tax ABCs of buying a property Simon Brown * I hold ungeared positions.

Simon Shares Bidcorp - excellent AvdTech* - really good, stock at all-time highs Stadio - good student growth Motus - poor HEPS, good dividend Woolies* - not bad, but wow only got R1.1billion for David Jones Sasol - impairments galore Adcock Ingram - capacity utilisation is weak Aspen - good second half KAP - tough out there Super Group - strong numbers * I hold ungeared positions.

dd Spur and Calgro M3, two stocks I have been watching and both have seen their prices break higher. Calgro M3 (JSE code: CGR) builds lower income housing and after a few troube years os back on track. Latest results were for year ending February 2023. PE ±2.5% Cash on hand ±R172million, market cap is ±R440million NAV 951c (including unused land valued at ±30% of NAV) while share price 365c Spur (JSE code: SUR) sells fast casual food and the pandemc hurt. Latest results have some base effect as they are for six months ending June 2023. Forward PE ±5x Dividend yield ±14% Spur remains their key brand. Simon Shares Thungela (JSE code: TGA) results saw HEPS down 67% which is the same as the price of coal over the last year. UBS cuts China's GDP growth forecast for 2023 from 5.2% to 4.8% CoreShares ETFs name change to 10X. Local inflation for July was 4.7%, a really strong number and better then the market expected, this even as administrative prices kicked in during July. Transport was negative for the period. Charts by Koyfin 15% discount for first 2 years

China in trouble as economic data keeps on disappointing? Chinese data keeps disappointing, every since the -7.5% export data from April. Expected was a strong rebound after they lifted zero-covid restrictions. But not happening. Just this week; Among 70 Chinese cities, 49 saw a fall in new home prices month-on-month in July from 38 cities the previous month. China suspends youth unemployment data after record high. Over the last decade they've halved the number of indicators they publish. Retail sales lower Industrial production lower fixed asset investments lower Simon Shares MTN (JSE code: MTN) results had an interesting update on their fintech business. reports were they would list it, but for now Mastercard has taken a stake valuing the business at ±R100billion while MTN market cap is ±R250billion. Satrix is shutting down three of the ETFs they got from Absa. They are the Volatility Managed ETFs. They two small and not core to teh Satrix startegy. If you hold them on close 29 September you'll be paid out the NAV. The three are; STXMEQ STXDEQ STXGEQ Buying the Nasdaq local or offshore? Which is better? Every time is actually different How to double your retirement fund Koyfin 15% discount for first 2 years

Aspen looking cheap? Aspen (JSE code: APN) announces a acquisition in Latin America for US$290m on a price/sales of ±3x and PE of ±5x. This is a classic Stephen Saad sort of deal. Strong cash generation to pay down the debt. After having gone quiet when the balance sheet case under serious pressure (with debt of ±R50billion) Aspen is back? Chart looking good for a break higher. Forward PE of ±12x is below 1 standard deviation over last twenty years and looking cheap. Charts by KoyFin, click here for 15% off a two year subscription. Simon Shares FOMC raised 0.25% as expected last week. In the press conference Powell suggested no recession coming and with inflation for June at 3% has the fed successfully threaded the inflation needle without any serious repercussions (so far)? MTN (JSE code: MTN) trading update, 169c cost for 'currency moves' likely the Nigerian Naira devaluation. Prosus (JSE code: PRX) agrees to sell part of PayU to Rapyd for $610m. They'll keep the Indian market part of the business. How is your crypto taxed? Nominal vs effective interest rate, know the difference.

Central bakers have very few tools to achieve their mandates around inflation (and in some cases also protecting a currency and aiding GDP growth). Interest rates have a blunt lagged effect and their only other tool is what they say and we need to understand this central banker speak. Last week it was the South African Reserve Bank MPC rate announcement that left prime unchanged for the first time since November 2021. The vote was close and the governor spent a lot of time saying they had not finished hiking, this was just a pause. The Federal Reserve FOMC has been saying the same about pausing before more hikes. But any hikes will surely be data dependent which is what they always say. So the threat of more hikes is central bak speak for don't get too excited. Simon Shares Shoprite* (JSE code: SHP) trading update shows just why they are the best food retailer in South Africa, even probably the world. This as they had to spend R1.1billion on diesel for the 52 weeks. This will hurt margins, but they're still profitable. The Rand is on a tear, and this time it is not US$ weakness nor commodities booming. It's just good old fashioned people buying our Rand. Global luxury ETF, better than buying the watch Reducing tax on interest earned * I hold ungeared positions.

As expected Local CPI for June came in at 5.4%, lowest in twenty months and well within the 3%-6% target range from the South African Reserve Bank. Yes base effect as June last year was the first +7% inflation print of this cycle. When do we start talking rate cuts? Truthfully not yet, a pause would be nice eve as the gov always targets 4.5% not the range. Simon Shares MPC is Thursday, I expect no raise and can we start talking about rate cuts yet? USDZAR currency forecasts from Goldman Sachs: End 2024: 16.00 End 2025: 15.00 End 2026: 14.00 Decent UK inflation as it dropped to 7.9% for June vs. expected 8.2%. But still highest in Europe. Italy 6.9%, Germany 6.4%, Netherlands 5.7%, Euro area 5.5%, France 4.5% & Spain 1.9%. Pick n Pay (JSE code: PIK) very poor update. "SA sales declined 0.3% (0.0% like-for-like)" while "internal selling price inflation" was 9.5%, so they went backwards at a fairly alarming rate ArcelorMittal South Africa (JSE code: ACL). Monday CFO quit after just two weeks and then Tuesday a horror update. Transnet selects a private port operator to run the container terminal in Durban. Koyfin 15% discount for first 2 years The Indian Nifty 50 at all time highs and we have an ETF for that.

Simon Shares US inflation for June was 3.0%, expected was 3.1% and previous 4.0%. Next FOMC meeting is 25/26 July. I think they still do a 0.25% rate hike, but then maybe pause for good, well until cuts start next year. Nasdaq100 special rebalance to cut the 'Magnificent Seven' to "address over concentration in the index by redistributing the weights." Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia and Tesla are the magnificent seven. They account for 55% of the index. Effective close 21 July Done twice previously; December 1998 and May 2011. The combined weight of the five stocks with the largest market caps will be set to 38.5%, currently it is 46.7%. Nasdaq100 is a modified market capitalisation index. So market capitalisation is not the only consideration, albeit is the biggest contributor. Overall this has already seen some selling in the big five, and buying in those that are expected to be weighted higher. Final weightings will be announced after close in Friday 14 July. The Four Horsemen of Big Tech A phrase coined in the late 1990s for Microsoft, Intel, Cisco Systems and Dell Computer as they stormed higher in the dot com craze. All had horrid collapses and took o a decade plus to recover their dot com levels and Cisco and Intel have been modest investments at best with Dell delisting. Are we seeing the same with the magnificent seven? Yes, no, maybe. It is different this time, they all have real tech and make real profits. But have they gone wild on the AI bonanza? Absolutely. Now sure, AI will only get better and all seven have a real chance of be the real leaders in the space (in different ways). But valuations are stretched and this current earnings season is important as are the next few as well. Simon Brown

Two-pot system is confirmed, here all the details Starts 1 March 2024 All future reg28 and pension contributions will be split into two pots One third savings Two thirds investments You can withdraw the savings component before retirement Tax still payable Existing funds will convert automatically into the new two-pot system Of existing funds R25,000 will be transferred into the savings pot Concerns about everybody taking out their R25,000 and crashing the market are over done. Simon Shares Top ETFs so far in 2023, so +50% returns in just six months. New-vehicle sales in SA +14% for June. But last year June Toyota Durban was still closed after flooding. But still a decent number. Pep (owned by Pepkor) has started offering credit to customers, they own Capfin so have experience in lending. China will control exports of some metals used in the semiconductor industry. Gallium and germanium are considered "minor metals." They're not rare but costly to produce and China supplies ±80% SARB says fight to tame inflation monster is paying off. First time he has even hinted that maybe inflation is coming down. Simon Brown

SA Inc watch list. Building a list of stocks that are cheap, very cheap, and could give good return n the next year or three. Criteria; Must be profitable, so positive PE ratio Must be cheap, so PE below 8x Small as in market cap under R8billion No REITs Using Koyfin I get 46 stocks including REITs and detail them in the podcast. I'll create a watchlist on Google docs and share that link in time. What about just the mid cap ETF from FNB? FNBMID. Sixty stocks but problem is the top holdings are; Sibanye-Stillwater*, Discovery*, Nedbank, Bidvest and Remgro. That's already ±25% of the ETF and none really for my requirements as above. Simon Shares Local crypto exchange, Revix, suspends trade or withdrawals on 24% of client crypto assets as their South Korean partner has issues with a provider. Naspers (JSE code: NPN) & Prosus (JSE code: PRX) plan to remove the complex web of cross holdings to a simple structure whereby Naspers owns 47% of Prosus who owns the stake in Tencent (Hong Kong code: 700). Good Invicta (JSE code: IVT) results. Rand all over the place. Brent weak, surely suggesting the global economy is weak. But so far the promised 2023 recession has not arrived, remember the hard vs. soft landing debate of late 2022? * I hold ungeared positions. Simon Brown

Local CPI 6.3% for May (lowest since April 2022) from 6.8% in April and vs expected 6.5%. A very good number and we should see June below 6% as June last year was the first +7% in this cycle at 7.4%. Simple base effect should put some serious pressure on inflation over the next few months. So is inflation largely over locally? Probably. Can we start talking about when the MPC starts cutting rates? The next MPC rate announcement is July, the day after we get June inflation and we'll see that the governor says. But cuts are maybe fourth quarter fo this year, at soonest. Standard Bank thinks another 0.25% hike later this year and consensus is cuts only starting next year. Simon Shares UK core inflation rises from 6.8% to 7.1% and CPI 8.7%. They are in trouble. Standard Bank (JSE code: SBK) trading update. Very much two parts, bad debts are ugly and profts are lookign great. They also expect a 0.25% rate increase in the second half of the year? Afrimat (JSE code: AFT) deal to buy Lafarge for ±R1billion. String vertical intergration and potential to boost profits to essentially be paying around a 3x PE. They also say that it looks lie constructions has bottomed in 2022. Omnia (JSE code: OMN) results. Agri struggling with margin pressure, ining booming while chemicals slips. But overall good and stock si cheap. Transaction Capital (JSE code: TCP) secures funding for Gomo. Securing the capital was a major market concern and now they have a bak using their balance sheet and they earn a margin. Good deal but market still selling. How to Diversify Your Commodity Exposure With the PICK ETF Dividend portfolio paying monthly

dd Disappearing dividends Just this week Spar (JSE code: SPP), MultiChoice (JSE code: MCG) and Telkom (JSE code:TKG) have all cut dividend to zero. We had big dividend payer Coronation (JSE code: CML) drop theirs to provision for the SARS fine and historically good dividend payer Pick n Pay (JSE code: PIK) reduce theirs. This shows the pain that companies are experiencing, not all, but certainly some, It perhaps also shows quality, for example Shoprite* (JSE code: SHP) increased their dividend. The problem is we love dividends for cash flow and they tend to grow ahead of inflation, sometimes well ahead of inflation. They're also taxed better than traditional income from bonds or cash (albeit not as low as CGT). But the downside is that any dividend can disappear at any time. For investors such as myself, reduced dividend is not a big problem. I like the cash flow but don't need the income for expenses. For those living on dividends the pain is real. If the income is required you need a good amount of bond and cash investments and REITs that aside from the pandemic pay consistently, albeit REITs reduced over the last 5 or 6 years. Another option is something like dividend aristocrats (we have a local and offshore ETF for these). Here we have companies with decade long track record of paying dividends, but remember Steinhoff (JSE code: SNH) was in the local dividend aristocrat ETF, so even this is not guaranteed. But a basket or ETF works well. Simon Shares US CPI for May 4.0%, lowest since March 2021. Latest IEA global oil market outlook: peak oil combustion by 2028? Petrol demand to peak this year Road transport oil demand peak 2025 All transport by 2026 Overall oil for combustion peak 2028 ZAR 18.33 Massive moves expected in Richemont (JSE code: CFR) on Thursday 15 June as the index rebalances. Could see ±R4billion of selling. * I hold ungeared positions. Simon Brown

Simon Shares SEC sues Binance and CEO for U.S. securities violations. SEC Charges Coinbase for Operating as an Unregistered Securities Exchange, Broker, and Clearing Agency. First quarter GDP was 0.4% and we avoid a technical recession. Pepkor (JSE code: PPH) price slide. Tigerbrands (JSE code: TBS) horror results. Oceana (JSE code: OCE) results knock it out the park. Sun City visit. Excellent resort, but very quiet which many commentators suggest is because it's a random weekend in June? I sent this past weekend at Sun City, vacation club. Some thoughts. The resort is world class, well maintained with a ton to do for kids and adults. 1/n pic.twitter.com/29yaV2GP8b — Simon Brown (@SimonPB) June 5, 2023 Buying SA Inc. Not yet but building a watch list with the plan being to buy 10-15 stocks over the months ahead. Why? Inflation comes down Rates decrease Load shedding ends (Renewable Energy Grid Survey points to 66 GW development pipeline in South Africa). Government finds a way out of the ICC Putin arrest warrant mess. Rand improves (already 100c better than the R20/US$ of last week) I hold ungeared positions. Simon Brown

Simon Shares MPC raised rates by 0.5% makes prime 11.75%, highest since 2009. The aim I suspect was to protect the rand, and that totally did not work as the currency hit its worst ever levels. Where will the rand go next? Does it ever strengthen again? RSA Retail Bond rates reset this morning and I expect the 5-year fixed to potentially increase by a full 15% and the CPI linked also reset and I also expect an increase there.. Will have update on the website. Tsogo Sun Gaming (JSE code: TSG) announced in their results last week they had acquired a ±10% stake in City Lodge (JSE code: CLH). Why? Also those were good results, much cheaper than other in the space. Zeda (JSE code: ZDD) results were poor. I was looking for FY 400c of HEPS, that's now seems a long shot. Debt is large, no dividend and short-term vehicle rentals is only a little above a quarter of pre-pandemic levels. I was holding and have sold. TigerBrands (JSE code: TBS) results were a shocker but not unsurprising? Volumes flat while revenue was +16%, hello inflation. Got some debt, but totally manageable. Load shedding hurting, consumer broken and inflation all over. But the stock trades at ±1.5x book value (see chart here), last tine this happened was 1998 when prime hit 26%. Spar (JSE code: SPP) trading update, ouch. Is Shoprite* (JSE code: SHP) eating everybody's lunch? Don't forget to action your Purple Group* (JSE code: PPE) rights issue. You have until Tuesday to either sell the rights or take them up. Meta (Nasdaq code: META) fined Euro1.2billion by the EU, but stock rises on the day. These fines, even large ones, are just a cost of doing business for the mega large cap tech stocks? Nvidia (Nasdaq code: NVDA) gets all the AI hype and love to a trillion dollars. * I hold ungeared positions.

Simon Shares Bond ETFs yielding ±10%. That's chunky and they can go in a tax-free account. New INCOME ETF from CoreShares. Purple Group* (JSE code: PPE) rights issue. If you held the share yesterday at close on Tuesday 23 May you will see PPEN in your account. 10.20567 for every 100 Purple shares you held. Each PPEN (letter of allocation or LOC as some are calling it) entitles you to buy 1 new Purple share at 81c. You can take up that right and buy, or You can sell them in the market If you do NOTHING by 6 June they disappear with ZERO value Sanlam will take their R45m and of the R105m public offer they will take up to ±R76m of the R105m if nobody else does. Existing large shareholders have promised to take up their rights at ±R28m. So at the end of the day they will get the R105m. Simon Brown * I hold ungeared positions.

Simon Shares I have been talking about a cracking (broken?) consumer for a few months now. Two recent surveys show exactly this data. BankservAfrica's five-year review of Take-home Pay and Private Pensions in South Africa for February 2018 – February 2023 "The average nominal salary Take-home Pay Index, increased from R12,573 to R15,438, +22.8%." But CPI was 26.6% and take home pay had kept track until last year. Debt Busters Debt Index | Q1 2023 survey "Nominal incomes were 2% higher than 2016 levels, however when cumulative inflation growth of 40% is factored in for the same seven-year period, consumers' purchasing power diminished by 38% over this period.". Rand trades at worst level ever on Friday, R19.5169/US$. Transaction Capital (JSE code: TCP), last week I sad the worst may be behind them. Well with the ZAR collapsing equalling more inflaiton and rates and petrok increases. Maybe not for SA Taxi or WeBuyCar. Purple Group* (JSE code: PPE) rights issue. Full details on 18 May. It will be R105m from Purple Shareholders and R45m from Sanlam at Easy Equities level. Total R150m Local PGM production down 14% in Q1. Calgro M3 (JSE code: CGR) results saw HEPS just above 150c while the stock trades at ±300x. Value or value trap? Sold my Sun International (JSE code: SUI) as price go backwards and I protecting profits. Excluding dividends ±70% return since November 2021. OpenAI Sam Altman goes before US Congress to propose licenses for AI. Pulling the ladder up behind you to stop others. I have been using ChatGPT via Bing and Google Bard. For investors they mostly useless. Octodec (JSE code: OCT) results. Large discount to NAV and DY ±14%. Investing in mega trends * I hold ungeared positions. Simon Brown

Simon Shares Transaction Capital (JSE code: TCP) results where pretty much as expected. Management have essentially thrown the kitchen sink at everything. H2 will be tough but likely a little better. FY24 a clean slate. But market does not agree with me. Nutun doing good WeBuyCars under pressure, no surprise, consumer cracking SA Taxi real ugly, but as detailed in trading update US unemployment 3.4%. April CPI 4.9%. The end of the US$ Bretton Woods essentially created teh US$ as a reserve currency Now all commodities trade in US$ The end of the US$ is as old as time, really kicked off with the advent of the Euro in 1999. But who take over? China, no? BRICS, that's only China. Euro, but they don't want a strong Euro and the world doesn't want the Euro either. That said, the US$ will lose influence over time. It has been and will continue to do so. One day it may well be over, but we're a very long way from that.

Simon Shares Implats (JSE code: IMP) trading update saw production down and costs up. That's squeezing margins and going to hurt. Kumba (JSE code: KIO) nice boost in production, but iron ore prices are falling. Will hurt Afrimat (JSE code: AFT) as well. Combined Motor Holdings* (JSE code: CMH) results sees them on a PE of under 5x and DY of ±13%. But return will be mostly from dividends, ±650c over next thirteen months = ±22%. Renergen* (JSE code: REN) results. Smaller loss, but no profit as they ramp up Phase 1. A deal with Timelink for LNG and contracts with Consol & Italtile most of Phase 1 LNG (±50 tons a day) is under contracted sale. MTN (JSE code: MTN) update from Ghana and Nigeria look good. On PE ±11x, stock is cheap, albeit not without risks (always for MTN). All my index trades have been stopped out. * I hold ungeared positions. Simon Brown

Simon Shares Coronation* (JSE code: CML) trading update, aside from the massive SARS judgement (and hence no dividend), not bad. But not yet time for buying as sellers persist. Purple Group* (JSE code: PPE) results saw a loss for the six months ending February 2022. But lots of extra one off expenses (expected for a growth business) and a tough market and they still have excellent growth potential. I continue to hold. * I hold ungeared positions. Simon Brown

Simon Shares Local CPI 7.1% for March up from 7.0% in February. Expected was 6.9%. Core inflation 5.2% vs expectations of 5.1%. Rates higher for longer. Reviewing Minister Pravin Gordhan's portfolio. Too many stocks, why not more ETFs? Platinum at all-time highs in rands. This as it trades at more than 50% off the all-time US$ highs from 2008. Still long all my index trades. Time to sell Capitec* (JSE code: CPI) as results show them as ex-growth? Return in Equity (RoE) 26% Cost-to-income (CTI) 39%. Impairments +80% and worrying the market But my worry is it is priced +2x valuations of the other four big banks and it is now largely a mature bank. Sure low cost base, but I do not think it deserves that high valuation so am likely exiting after holding since 2009. * I hold ungeared positions.

Simon Shares US inflation for March at 5.0%, better then expected and initial response form markets was to jump higher. Big wait now is for first week of May and the next FOMC rate decision. Current open trading positions, long everything My 7/21 trading system has me long all the indices I trade as below; Nasdaq 22Mar23 @ 12,740 S&P500 21Mar23 @ 4,056 Euro Stoxx 50 03Apr23 @ 4,317 ASX200 05Apr23 @ 7,240 FTSE100 11Apr23 @ 7,793

Simon Shares Combined Motor Holdings* (JSE code: CMH) strong trading update puts the stock on a PE of under 5x and a dividend yield of ±15%. A great well run company, but what will get the price moving higher or do we just live off dividends? * I hold ungeared positions. Strong first quarter returns Q1 2023 return[/caption] Top40 stocks, top and bottom performers pic.twitter.com/zwZlJkRpwX — Simon Brown (@SimonPB) April 3, 2023

Simon Shares MPC announcement Thursday. Purple Group* (JSE code: PPE) git the 120c bottom of the range, but has suddenly rallied. Steinhoff (JSE code: SNH), we now know what as the "Board agrees on a radical draft plan to enter into an insolvency process with creditors". The problem with dividends - they not tax efficient. They are great But tax. Dividend Withholding Tax (DWT) is 20%. The maximum Capital Gains Tax (CGT) is 18% after the annual R40k exclusion. And DWT you pay along the way, eroding your return over time whereas CGT you only pay at the end. Warren Buffett Berkshire Hathaway has never paid a dividend and he says they never will. Rather sell he says, more tax efficient. Share buys backs are more efficient, but done at high valuations destroy capital. No easy answer, but maybe we should temper our love? * I hold ungeared positions. Backup power on a budget Is the spread important when buying an ETF? Simon Brown

Simon Shares Federal Reserve FOMC raises 0.25% and the market drops as Fed says almost at the top. Local CPI comes in slightly higher at 7.0%. MPC meets next week, hold on rates or another +0.25%? Credit Suisse 'sold' to UBS. Steinhoff (JSE code: SNH) votes against the debt deal, now what? Bankruptcy surely? Transaction Capital (JSE codeL TCP) bounces, where's the value?

Simon Shares Silicon Valley Bank collapse, does this put a pause on US rate increases? FOMC next Tuesday/Wednesday. "Moody's cuts outlook on U.S. banking system to negative, citing 'rapidly deteriorating operating environment'" Miss expectations and get slammed Transaction Capital Absa MTN Multichoice Hold winners, ditch laggers. Sun International (JSE code: SUI) vs. City Lodge (JSE code: CLH). ff * I hold ungeared positions.