SGIC - FIRST TRADES MAKES IT MARKET NEUTRAL

We are happy to report that SGIC took its very first trade today. Well, it took a few actually. We implemented a Market Neutral Portfolio for the club. Basically what this means is that the club took a few long positions and a few short positions; 10 of each to be exact.

We made use of our valuation model to sift through the market and find the 10 strongest and 10 weakest shares on the JSE. The strongest shares were bought (long) and the weakest shares were sold (short). This puts SGIC in a position where the two opposing exposures, being long and short, offset one another and reduces the risk profile of the portfolio. Another added bonus is that the stronger shares should continue to climb while the weaker shares should continue to struggle, putting SGIC in a favourable position.

We will be posting some more info about the Market Neutral Portfolio a little later along with the odd graph or two. Keep an eye out for our next update.