The Australian index also lost 8.75% on a currency-adjusted basis. Although the NESTOR Australia fund performed better, it also shed over 5%, with the Aussie dollar making a sizeable contribution with a drop of nearly 4%.
Within the NESTOR Australia fund, lithium stocks were closed out at high prices – this theme remains very interesting, but the sector was overvalued. Only the long-term position in Mineral Resources will be retained. At the end of the quarter, a number of non-resources shares such as Bingo Industries and Origin Energy were also sold to increase the cash position. A takeover bid was reluctantly accepted for the large, very long-standing position in Finders Resources.
The situation is currently very confused – rising interest rates (usually positive for the commodity markets) are up against highly politicised stock exchanges. Threats of US trade restrictions are weighing on the good sentiment in major economies, while Russian sanctions are creating unusual volatility in commodity markets. Rising nationalist tendencies in many countries are increasing the risks, not only in the commodities sector. We generally remain positive about metals. However, growing uncertainty and slightly inflationary tendencies in some markets are making us more and more interested in gold mines.