The Sunares Fund
SUNARES is an actively managed fund that offers an important alternative to the majority of equity and index funds. The fund invests in companies outside of the financial arena and concentrates on those sectors we think are entering a durable structural uptrend. These include areas such as agriculture, energy, alternative energy, food, water, forestry, raw materials and precious metals. Investors should be aware of the following key points:
- No exposure to the financial sectors
- No derivative exposure
- No currency hedging
- No performance fee
The Investment Case
The 20th century saw the biggest increase in the world’s population as a result of industrialisation, medical discoveries, agricultural advances and the humble refrigerator. Global population is eventually expected to plateau, but not before we see further substantial growth (rising from the current level of 7 billion to 9.3 billion by 2050 and then on to 10.1 billion by 2100 – source United Nations 3.5.2011).
This presents the world with difficult choices in terms of managing the limited existing resources at our disposal. A global decline in oil supplies (peak oil) would be devastating in itself but we are also confronted with the need to produce more food – which, in turn, focuses attention on the availability of useable water. Solutions to these and other problems are needed in order for mankind to live in a sustainable fashion and companies will play a major role in meeting this challenge. It is these companies that SUNARES concentrates on.
At the same time there is a strong “bull case” that supports an ongoing boom in the development of infrastructure in emerging economies such as China and India. This echoes the Marshall Plan implemented in Europe after the 2nd World War – or perhaps more closely the industrialisation of Japan – and will help to drive the current market for global equities. Furthermore, the desire of countries such as China, Japan, Russia, Taiwan and Norway to enhance the returns on their growing foreign exchange reserves underpins the demand for global equities and commodities.
This equity bull market coincides with the current commodity boom as well as a maturing multi-decade downtrend in bond yields. These trends are exerting an inflationary influence which makes the preservation of purchasing power of major importance.