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I would not do that Yozzi. Will give you some figures out my head. Coronation's revenue is highly geared to the markets performance and the market has not been doing too well lately. This is the last quarter before the years final results and I don't see the volatility diminishing.
This quarter's AUM increased less than normal adding to the above problem. This was perhaps due to the closure of new institutional investments and the exchange rate.
March 2012- 6M results. HEPS up by 6%.
Sept 2012- 1Y results. HEPS up 12%. AUM up 37% compared to 35% for 2011 and 28% for 2010.
These were mediocre results and less than expected causing a first ever correction in CML although the increase in AUM was high.
March 2013- 6M results. HEPS up by 72%. This caused a surge in CML's price. Up from its average of 65%pa to 130%pa.
September 2013- 1Y results. The AUM already up in June by 28% and projected to 34% by end September. Due to the market I cannot forsee an increase of more than 5% in HEPS taking last years figures and market performance into account.
So going long on CML with borrowed money will not be wise.
Thanks Orca point taken do you think that today's CML price of just under R65 is about as low as it will go now?
