FMG (EU) Combo Fund gained +5.1% in the 3rd Quarter of 2017

The FMG (EU) Combo Fund had yet another strong quarter given the favourable macro picture for global equities.  Emerging Markets remain slightly overweight at 49%, continuing to benefit the fund. Strong GDP growth from the largest economies in the world, low inflation and continued low-interest rates all add up for the good quarter and year-to-date performance.  Emerging market equities trade on average at a 30% discount to developed markets.

The best performance for the quarter came from Brazil with an outsized gain of 22%.  Russia gained 15% benefiting from good oil prices for Russia and the economy is growing at nearly 2% despite harsh sanctions. China A shares (domestically listed stocks) gained mid-single digits while India was up only 2% given strong gains in the first half of the year. The MENA markets were flat for the quarter.

The developed market part of the portfolio, making up approximately 43% of the assets, posted gains of around 4%.  European equities were slightly ahead of the US, removing the uncertainty of the important German election where Angela Merkel will lead the country (and Europe) for another four years despite a weakened position post-election.

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