the_wise_investor20121012_1350047499

7/31/2019 the_wise_investor20121012_1350047499

1/8

Where do they stand?

Vol 6 - Issue 6 | October 2012 | Rs.3.50

Zero interest and negative interest rates are likely for

protracted period and this is never a good sign of the state

the real economy.

The U S Fed and the ECB have no idea of how to exit from t

gargantuan balance sheets that they have in place.

The monetary policy pursued will eventually lead hyperinflation.

It is tough to predict the timing of how and when this cr

ends.

The situation in Japan gets direr by the day despite 20+ ye

of fighting deflation.

Be prepared for long-lasting lifestyle changes, though it may

slow to come about.

Equities are deeply overvalued in the developed world.

In emerging markets, equities must be rented by smart trad

and not be pursued as a buy-and-hold asset class.

Gold remains a preferred asset class.

Do not be wary of staying in cash too.

Capital Preservation must be a key investment objective

investors in this macro environment.

Perspective

Source: Colonel Flick (via The Williambanza17 Blog http://williambanzai7.blogspot.in/), September

Image of the Month QE Gangnam Sty

Sundaram Asset Management The Wise InvestorOctober 2011

Over the past five years, The Wise Investor has brought to you the

views of persons who saw the global financial and economic crisis

coming and articulated approaches that could prepare investors

for what has followed since the official onset of the crisis in

August 2007.

There has been much action by the governments and central

banks in the developed world both throwing several trillion

dollars as so-called solution to the crisis.

The size of balance sheets of the U S Federal Reserve and

European Central Bank, which had a combined size of under a

trillion in 2007, today is in excess of $ 6 trillion and set to mount

further.

Nothing that caused the crisis has been solved by the actions of

the central banks and governments.Where do the fairly long list of

persons (for the best among them, check out our preferred blogs

and books published in The Wise Investor of September 2012)

who saw the crisis stand now? The sum and substance of the views

of this group is:

We are a long, long way from a genuine solution to the

problems in the developed world.

Be prepared for long periods of low and slow growth.

Throwing more debt (even if the source changes) is no

solution to the problem.

The worst is yet to come in the Eurozone. U.S situation is dire but for now has taken a backseat to the

Eurozone, which is in the limelight.

The focus of policy makers still continues to be to safeguard

big banks and private bond holders.

Periods burst of deflation is likely.

Any recovery in the economy is unlikely to be of a sustainable

nature.

Unemployment remains a far bigger problem than what is

suggested by the official numbers.


2/8


India View Bonds

Indian markets have delivered about 22% in 2012, making most

pessimists go back to the drawing board. But it is important to

note that much of this return was in brief spurts causing fear and

trepidation as to whether these returns are ephemeral.

When sentiment is poor, investment cycle will not pick up on low

interest rates alone. There has been a massive shift of money

from risky assets to bonds to protect money from volatility,

which pushed bond yields lower, sucking in more money. That

appears to have ended now and money will now have to look for

value deals in overseas markets as well.

Further, countries with global trade surpluses are also investinginto emerging markets as they find US bond yields too low.

Corporate profit growth will remain muted for some more time

on the back of higher provisioning cost in the banking system, and

the oil and gas sector having issues of their own. Capex cycle,

especially power, looks very weak and will impact equipment

suppliers.

Consumption sectors are also slowing down on account of the

high growth that we had in the past few years and a delayed

monsoon and festive season, but does not concern us as much asthe infrastructure space. The flow data seems positive and that

should help equity inflow into some of the leveraged sectors such

as power and infrastructure improving confidence significantly.

This should help grease the wheels and increase the velocity of

money. Equity assets have been shunned by all investors and will

come back in favor for want of alternatives and a willingness to

increase risk levels.

Riding the volatility through by buying the dips is an attractive

option, and a systematic investment plan a simpler option. Mid-

caps may be viewed as risky assets, but still outperform large caps

by a wide measure. Volatility is more apparent in equity markets,

while the bond markets may appear to be an oasis of calm. Equity

assets do, however, have the potential to earn more and if one

can reduce the lumpiness through a SIP, then one can take

advantage of volatility.

Satish Ramanathan

Head - Equity

India View Equity

Flow & Volatility

Outlook: The change of guard at the finance ministry has set t

ball rolling for the much needed fiscal consolidation this bod

well for the bond markets. The markets are likely to take this w

cautious optimism, as a lot needs to be done to rein in the fis

deficit to 5.3% as estimated by the finance ministry.

The game plan focuses on the meeting the divestment targets a

selling 2G waves. Lowering the expenditure of the governm

and augmenting the revenues can only resolve the interplay

current account deficit and fiscal deficit. In 2012 so far, we have h

$ 21 billion inflows on equity and deb, which helps in address

the current account woes

Liquidity in the market looks comfortable with the central ban

1% NDTL not breached and capital account flows also improv

can relieve pressure on liquidity alongside the lower credit grow

the incremental credit growth from March 2012 at 96.2% h

declined to 72.6% now.

We expect the central bank to act pro--actively to contain t

deficit within the 1% NDTL band if liquidity tightens in the b

season. We are also wary of the Rs 20000 to 30000 crore p

month cash leakage in the festivities for the nest 2 to 3 month

Going forward, inflation looks to escalate on account of revis

electricity prices and diesel price hikes. In this backdrop it will

difficult for RBI to cut rates yet in the upcoming monetary pol

at the month end but any further government action towards fis

consolidation may provide it room to ease rates.

Strategy: With the current regulation of the liquid fun

securities being marked to market with over 60 days and sect

allocation limited to 30% of the fund size, it becomes imperativemaximize the yield of the 30% of the portfolio with adequa

credit in the money market funds. On the longer-bond case

yields moving lower further looks stronger than before and

would look to remain invested for the fiscal 2013 and maint

duration with only switching securities.

Dwijendra Srivatsava

Head - Fixed Income

Liquidity eases, but...

A detailed view is available atwww.sundarammutual.com A detailed view is available atwww.sundarammutual.co


3/8


Chart of the Month

Even though the German constitutional court gave its blessing to

ECB president Mario Draghi's OMT (Outright Monetary

Transactions) program, Concerns Mount that ECB Bond-Buying

Program Is Illegal.

Concerns? What Concerns?

Concerns are in the eye of the beholder. Moreover, I have no

doubt that German Chancellor Angela Merkel knows full well

that not only is the ECB's program in violation of ECB mandates,

it is also against the German constitution.

Had Merkel made objections against the OMT, the court would

likely have struck it down. However, Merkel does not want the

disintegration of the euro on her watch and that is all that

matters.

There was no vote by German citizens. And as expected, the

German constitutional court bowed to her majesty Angela

Merkel. She was willing to sell her soul for her political beliefs and

to preserve her legacy. Merkel sold her soul alright, its her legacy

that is in question.

Concerns by the German central bank do not matter either. The

same thing happened with Fed actions in 2008 and 2009.

I wrote about this well in advance (on April 03, 2008 to be

precise), and it is one of my personal favourite posts. I havereferred to it often enough but in case you missed it, please

consider the Fed Uncertainty Principle, specifically corollary

number four.

Uncertainty Principle Corollary Number Four: The Fed [ECB]

simply does not care whether its actions are illegal or not. The

Fed [ECB] is operating under the principle that it's easier to get

forgiveness than permission. And forgiveness is just another

means to the desired power grab it is seeking.

Politicians in high power as well as central banks do not give a

damn about concerns, nor do they care about obvious illegalities.

They do what they want because they consider themselves to be

above the law.

Concerns about legalities are for peons, not the royal court. In

the end, it does not matter what the concerns are, or even what

the popular vote total is. All that matters is who gets to vote, and

more importantly, who gets to count the votes

Mike "Mish" Shedlock

http://globaleconomicanalysis.blogspot.com

The Mish Take

Concerns? What Concerns?

In the chart, I have compared correlations during the 2000-

period (bright blue) with correlations in the current environm

(dark blue). As you can see, with one or two exceptio

correlations are generally much higher now. Now, you could qu

reasonably confine this observation to the academically interest

but why should I care? category, if it wasnt for the fact that m

investors around the world continue to manage money in a w

that is deeply rooted in the Modern Portfolio Theory schoo

thought even when facts suggest that a different approach to as

allocation and portfolio construction is warranted.

Nowadays, only a handful of sovereign bonds are considered s

haven assets. Pretty much all other asset classes are now deem

risk assets and they move more or less in tandem. Even gold loo

and smells like a risk asset these days. In the 2000-03 bear mar

commodities were an excellent diversifier against equity mar

risk with the two asset classes being virtually uncorrelated (+0.0

Nowadays, the two are highly correlated (+0.69). It follows that

are not only in a low return environment at present, as evidenc

by the paltry return on equities since the end of the secular b

market in early 2000, but we cant rely on the ability to diver

risk either. Niels Jensen, Absolute Return Partne

(www.arpllp.com)

Correlations (2007-12 vs 2000-03)

Source: MPI Stylus, Absolute Return Partners

0.14

0.27

Mgd.

Futures

Global

Equities

L/S

Equity

Abs.

ReturnsIG Bonds

Corporate

HYCommod. Go

-0.15

0.17

0.34

0.19

0.05

0.69

-0.30

-0.17

0.46

0.80

0.45

0.05

-0.33

0.14

0.10

0.04

0.20

0.51

0.21

0.62

-0.04

-0.04

0.19

0.06

0.50

0.50

-0.04

0.22

0.09

-0.05

0.02

0.54

0.01

0.13

0.28

0.34

0.14

0.39

0.21

0.64

-0.09

0.23

0.59

0.81

0.12

0.76

0.07

0.26

-0.19

0.05

-0.79

0.93

-0.44

-0.01 Mar 00-Mar 03

Oct 07-Jul 12

1.00Managed Futures

Global Equities

Long/Short Equity

Absolute Return

Inv. Grade Bonds

Corp. High Yield

Commodities

Gold

1.00

1.00

1.00

1.00

1.00

1.00

1.0

The views presented by the author (s) do not necessarily represent that of Sundaram Asset Management. The article / posts have been reproduced with permissor from reports available in the public domain in order to provide readers access to a diverse range of views on the economy and asset markets.
http://globaleconomicanalysis.blogspot.com/http://www.arpllp.com/http://www.arpllp.com/http://globaleconomicanalysis.blogspot.com/http://www.arpllp.com/


4/8


This historical evidence also highlights the sheer conceit of

Billyboy (Ben Bernanke, US Federal Reserve Chairman). Hisideological faith in monetary quackery, otherwise known as

quantitative easing, assumes he can torpedo the entirely

natural human desire to deleverage in the wake of a debt

bust by forcing economic agents to take on ever more risk.

And he continues to cling to this belief despite the fact that

the evidence since 2008 is that QE does not help the real

economy, even though GREED & fear will admit there is

evidence that it does give short-term support to financial

asset prices, primary to the benefit of the well-off. Still if the

Fed chairman does go formally in this open-endeddirection, it means that the relative ugly trade between the

US dollar and the euro has become a much harder call.

It also means that the yen faces renewed upward pressure

for the reasons discussed here last week unless the Bank of

Japan responds with a radical initiative of its own, and that

would seem unlikely so long as Masaaki Shirakawa is in

tenure.

All of the above is, obviously, mega bullish for gold bullion as

GREED & fearcontinues to view gold bullion, as well as its

precious metal appendage silver, as the key beneficiaries of

the bull market in Western central bank balance sheet

expansion, which has been under way since 2008. GREED &

fearwill, therefore, add another ten percentage points to the

weighting in physical gold bullion in the global portfolio for

a US-dollar denominated pension fund by removing the

longstanding investment in Asia ex-Japan physical property,

which has been in the portfolio since November 2003.

While Asian property has been a good investment since

then and will be a beneficiary in US dollar terms of more QEin America, the reality is that it has become a much more

complicated story in recent years than it was back in 2003.

By contrast, gold bullion remains a much purer play. It will

now account for 45% of the global portfolio.

Christopher Wood, Managing Director & Strategist

of CLSA Asia-Pacific, an independent research outfit

and author of the weekly report GREED & fear.

Source: www.clsa.com

The Outside View Investment Quiz

Going for Gold1 How many mutual fund houses are there in India now?

2 What is name of the German central bank?

3 What does PIIGS denote?

4 Who is the author of Big Short: Inside The Doomsd

Machine?

5 Name the person in the accompanying picture? He too hplayed a key role in altering the

shape of equity markets in India by

donning key roles over the past

decade and a bit.

1 If a fund is treated as equity-oriented, what are the t

benefits?

No tax on long-term capital gains and dividend

2 What is the key benchmark index in Brazil?

Bovespa

3 Who is the author of Exorbitant Privilege?

Barry Eichengreen

4 This Web site started off as `Jerry and David's Guide to t

World Wide Web'. Name the website?

Yahoo!

5 Name the person in the accompanying picture? He has play

a key role in altering the shape of equity markets in India?

Ravi Narain, Managing Director & CEO. National Stock Exchang

Answers for September 2012 Quiz

Disclaimer

Mutual fund investments are subject to market risks, read all scheme reladocuments carefully. The Statement of Additional Information of SundarMutual Fund and Scheme Information Document of Schemes of SundarMutual Fund, which are available at www.sundarammutual.com. Risk FactAll mutual funds and securities investments are subject to market risks. Thcan be no assurance or guarantee that a scheme's objective will be achievNAV may rise or decline, depending on factors and forces affecting securities market. There is risk of capital loss and uncertainty of dividedistribution. General Disclaimer: The Wise Investor, a monthly publication

Sundaram Asset Management, is for information purposes only. The Wise Investonot and should not be construed as a prospectus, scheme information docum

offer document, offer solicitation for an investment and investment advice, to nam

few. Information in this document has been obtained from sources that are reliabl

the opinion of Sundaram Asset Management. Opinions expressed by authors do

necessarily represent that of Sundaram Mutual Fund or Sundaram Asset Managem

or Sundaram Trustee Company or Sundaram Finance, the sponsor.Statutory: MuFund Sundaram Mutual Fund is a trust under the Indian Trusts Act, 1882 Spon(Liability is limited to Rs 1 lakh): Sundaram Finance Limited; Investment ManaSundaram Asset Management Company Limited. Trustee: Sundaram TrusCompany Limited. Past performance of Sponsors/Asset Management Company/F

does not indicate or guarantee future performance

Mutual Fund investments are subject to market riskread all scheme related documents carefully.
http://www.clsa.com/http://www.clsa.com/


5/8


The Fantasy of Debt


Blog Picks

and the Federal government gives them

over $2,000 a month in cash benefits:

$500 rent subsidy, $600 in food stamps

and $1,000 in free medical care. As a

self-employed person, I have to earn

$3,000 a month to net the $2,100 this

family receives every month, so it's like

a magic full-time wage earner slaves

away and gives this family his entire

earnings.

Only there is no "magic worker:" the$3.8 trillion the Federal government

distributes every year is two-thirds tax

revenues and one-third borrowed. To

the degree that our government

distributes $1.3 trillion in borrowed

money every year, everyone receiving

money from the Federal government is

living off debt that draws interest and

will never be paid. Thus it is an artifice

to say that a person collecting money

from the Federal government is "debt-free": the debt they are incurring is

simply once removed.

Credit leverages income. If $10 per

month in disposable income can

leverage $100 in debt, then if disposable

income rises to $20 per month, debt

can be doubled to $200. Lowering

interest rates increases leverage. If the

interest rate is cut in half, $10/month

can leverage $200 in debt. We are now

at the end-game of these twoexpansions of leverage: incomes are no

longer rising, and interest rates have

been cut to near-zero when adjusted

for inflation (a.k.a. loss of purchasing

power).

Relying on credit to fuel "growth" in

everything only worked when incomes

were rising and interest rates could be

cut. Now that incomes are stagnant f

90% of the populace and interest rat

have been slashed, there is no way

increase leverage. Adjusted real inco

has been stagnant for the "bottom 90

for the past 40 years. The savings r

has plummeted; the brief spike up

savings triggered by the global financ

meltdown has already faded. U

households save a mere third of wh

they once put aside. Note that tsavings rate is not broken out

income; the bottom 90% probably sa

very little, and the top 10% is proba

responsible for most of the savings.

If income is flat and interest ra

already near zero, then where is t

leverage for additional debt going

come from? The answer is the game

relying on ever-expanding debt is ov

You can claim phantom assets a

income streams as collateral for a wh

but eventually the market sniffs o

reality, and the phantom assets settle

their real value near zero. Once t

collateral is gone, the debt is a

revalued at zero, and the debtor

unable to borrow more. This is t

position Greece finds itself in. Liv

within one's income (household

national income) requires mak

difficult trade-offs and sacrifices: eith

current consumption is sacrificed

future benefits, or the future bene

are sacrificed for current consumpti

You can't have it both ways once t

collateral and credit both vanish

Charles Hugh Smith

Source: Of Two Minds (Sour

http://www.oftwominds.com/blog.html)

Easy, cheap credit has created a fantasy

world where everyone "deserves"

everything right now, and trade-offs and

sacrifice have been banished as

unnecessary. Everything can be bought

and enjoyed now. In the old days when

credit was scarce and dear, buying a

better auto required substituting 1,000

brown-bag lunches for restaurant

meals: yes, four years of daily sacrifice.

Trade-offs and sacrifices were the coreof household finances for those families

that sought to "get ahead" or purchase

things that required substantial cash.

Abundant, cheap credit upended the

incentives to make adult trade-offs and

sacrifice consumption for future

benefits. Why eat 1,000 brown-bag

lunches when you can buy a new car for

$500 down and "easy" monthly

payments? Heck, you don't even need

to pay for the lunches with cash; just

charge them. Want to go to college? Just

borrow the money via student loans.

Why scrimp and save when Uncle Sam

will guarantee $100,000 in student

loans? Why choose between a lavish

vacation, a year of college or a boat?

Buy all three on credit.

This mentality has infected the entire

nation and culture. Why should we have

to choose between $600 billion military

spending and $600 billion Medicare

spending? Let's just borrow the $1.2

trillion every year to pay for both.

I know young families who are "working

poor," where the father earns less than

$20,000 a year and Mom stays home

with the two young kids--yet they own

a much nicer and newer car than I do,
http://www.gregor.us/http://www.gregor.us/


6/8


Performance Tracker Global

Source: Bloomberg; Analysis: Sundaram Asset Management; Returns is in percentage and in U.S. Dollar terms for each period and not on an annualised basis.

IndexYear-To-Date One Month Three Months Six Months One Year Three Years Five Year

Return Rank R eturn Rank Return Rank Retu rn Rank Return Rank Return R an k Return R a

S&P 500 14.6 9 2.4 18 14.6 9 8.7 4 27.3 4 36.3 8 -5.6

Dow Jones 10.0 15 2.6 16 10.0 15 9.1 3 23.1 6 38.4 7 -3.3

Nasdaq Composite 19.6 5 1.6 19 19.6 5 12.1 2 29.0 3 46.8 4 15.4

Nikkei 225 12.6 12 7.7 2 12.6 12 -2.4 10 9.4 19 -6.0 23 -43.3

Dax 22.3 3 3.5 14 22.3 3 2.5 7 31.2 2 27.2 12 -8.2

FTSE 100 3.0 23 0.5 22 3.0 23 -2.8 11 12.0 16 11.8 16 -11.2

S&P GSCI Index Spot 3.2 22 -1.4 24 3.2 22 -8.3 18 12.6 15 43.9 6 21.9

MSCI World 10.9 14 2.5 17 10.9 14 -1.8 9 18.8 8 16.4 14 -19.7

MSCI Europe 9.0 16 0.7 21 9.0 16 -3.0 12 18.1 9 9.8 17 -29.9

MSCI Asia ex-Japan 13.2 11 6.8 6 13.2 11 -9.3 19 16.7 10 13.9 15 -16.0

Crude 5.3 20 -1.9 25 5.3 20 -3.4 14 8.6 22 67.4 2 42.6

Gold 13.3 10 4.7 12 13.3 10 23.7 1 9.1 20 75.9 1 138.3

Emerging Markets (MSCI Indices)

BRIC 4.5 21 6.2 8 4.5 21 -23.7 23 8.7 21 -7.2 24 -31.0

Brazil -5.6 25 2.7 15 -5.6 25 -30.4 25 1.6 25 -17.5 25 -22.2

Russia 7.4 18 5.3 10 7.4 18 -27.0 24 13.9 14 9.8 18 -39.6

India 23.6 2 14.6 1 23.6 2 -19.1 22 5.9 24 -1.6 21 -21.0

China 5.4 19 6.0 9 5.4 19 -18.3 21 13.9 13 -5.9 22 -36.9

Korea 14.7 8 7.0 5 14.7 8 -6.2 16 21.4 7 28.1 10 -10.7

Taiwan 11.7 13 7.2 4 11.7 13 -10.5 20 11.3 17 9.6 19 -15.9

Singapore 16.4 7 1.2 20 16.4 7 -4.6 15 14.0 12 9.4 20 -22.9

Honk Kong 18.0 6 7.5 3 18.0 6 -3.0 13 24.5 5 19.0 13 -10.1

Indonesia 1.7 24 5.2 11 1.7 24 1.1 8 7.2 23 45.3 5 52.6

Mexico 20.6 4 6.8 7 20.6 4 3.8 6 31.5 1 47.9 3 9.1

South Africa 8.8 17 3.7 13 8.8 17 -7.4 17 15.5 11 28.1 11 9.1

Turkey 28.9 1 -1.3 23 0.3 1 5.5 5 10.4 18 33.6 9 11.9

Top Performer Turkey India Turkey Gold Mexico Gold Gold

Worstt Performer Brazil Crude Brazil Brazil Brazil Brazil Japan

Analysis: Sowm


7/8


Voices


The New Food Crisis: 10 years ago we entered a new era of rising resource prices after at least 100 years of steadily falling

prices. It now appears that about five years ago we also entered a period of sustained food crisis for several of the poores

countries. This situation seems likely to continue for the indefinite future. If it does, it will cause the social structure of severa

countries to break down, resulting in waves of immigration on a scale unknown in modern times, outside of major wars. In thdrive for resources, particularly food but also energy, country relationships are also likely to be destabilized, causing risks to globa

security. China, more concerned with future resource security than others, will find it particularly tempting to throw its increasineconomic and military weight around. This risk also seems to be ignored or underestimated by national governments, althoug

the military arms of several, including the U.S., seem to be exceptions. The vulnerabilities from food pressure can be easil

demonstrated and are already beginning to play out. In developed countries, food accounts for only 10 or 12% of our total budgeFor several poorer countries, food costs have risen to 40% and above of their total expenditures following the surge in globa

grain prices since 2002. Global grain prices almost tripled in the last 10 years. If they were to double in the next 20 years it would

be painful indeed even for rich countries, but simple arithmetic will show how impossible the situation becomes for those poore

countries that start with a 40% share of food in their budget.

Jeremy Grantham, GMO (Source: www.gmo.com

The Solution is the Problem: On both sides of the Atlantic, the largest contributors to the current crisis are excessive deband spending. We are now at a point where additional government stimulus measures will have negligible, if not detrimental effecton the economy and long-term growth. Debt has to be reduced, not increased by more deficits. Central planners have

demonstrated that they dont have the discipline to implement the Keynesian model of surplus in good times in order to financ

deficits in bad times. We have now reached the limit of indebtedness and need to muddle through a painful but necessar

deleveraging. The politically favoured option of financial repression and negative real interest rates has important implication

Negative real interest rates are basically a thinly disguised tax on savers and a subsidy to profligate borrowers. By definition, taxedistort incentives and, as discussed earlier, discourage savings. Also, financial institutions, which are traditionally supposed to funne

savings towards productive investments, are restrained from doing so because a large share of their balance sheets is encumbere

by government securities. The same is true for pension funds, which instead of holding corporate paper or shares, now hold a

ever growing share of public debt. Pensioners, who are also savers, get hurt in the process. The current misconception that ou

economic salvation lies with more stimulus is both treacherous and self-defeating. As long as we continue down this path, th

solution will continue to be the problem. There is no miracle cure to our current woes and recent proposals by central plannerrisk worsening the economic outlook for decades to come.

Eric Sprott, Sprott Asset Management (Source: www.sprott.com

The U.S. stock market: is simply (and correctly) discounting a much slower rate of economic growth going forward. It

currently in the 13th year of a long-term bear market, the 4th such long-term bear market since 1900. Each one of these bea

markets has been defined as a transition from high valuations at the end of a long bull market, back to low valuations. Althoughvaluations today are quite a bit lower than in 2000, the market is still in the middle of a process of becoming cheaper relative t

earnings. Just as the valuation of an individual stock goes down when its growth prospects dim, the valuation of the entire marke

has declined as the economys growth prospects have dimmed. At some point, the markets valuation will be low enough that we

be able to confidently invest in stocks knowing the market has already priced in most or all of the effects of our high debt, slowgrowth predicament, and all the money printing well likely see. In all previous bear markets, that point came at a valuation lesthan half of what we find today, so our market likely has some ways to go. As with an economy going through a deleveragin

process, these bear market cycles take a long time to complete. Fortunately, the benefits for those who wait for end-of-bear

market valuations are great enough to inspire our patience. The wait will have been worth it when the next opportunity arrive

Until then, we continue to view stocks as an asset to be rented, and only when they are in a very favorable position.

Brian McAuley, Sitka Capital (Source: www.sitkapacific.com
http://www.sprott.com/http://www.sitkapacific.com/http://www.sprott.com/http://www.sitkapacific.com/


8/8


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If undelivered please return to:Sundaram Asset Management Company Limited,

Sundaram Towers, II Floor, 46, Whites Road, Chennai-600 014.

Because todays mid-caps are

tomorrows large caps!

Published by Sunil Subramaniam on behalf of Sundaram Asset Management Company Limited, from its office at Sundaram Towers, II Floor, 46, Whites Road, Chennai 600 014.Printed by R. Velayudhan at Paper Craft, No.25, C.P.Mudali Street, Pudupet, Chennai 600 002.Editor: Sunil Subramaniam.

Mutual Fund investments are subject to market risks,

read all scheme related documents carefully.

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