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● International Politics, p.03 ● Everything about Stock Markets, Data, Analysis, Opinion, p.05-09 ● World Trends in Investments, p.10 ● The Wealth of Nations by Adam Smith, p.11 ● The Big Portrait: Peter Lynch, p.12

CALENDAR WORLD Monthly Finance Review QUICK FACTS TIMELINE FOR AUGUST 2019 ✓Aug.1 MARKETS ● US President Donald Trump an- nounces in a tweet that Washington will impose import tariffs of 10% on Angeliki Frangou US$ 300 billion worth of Chinese ex- JACK MA ports starting Sept. 1. Navios Group CEO Alibaba Chairman ✓ A visionary woman in the Aug. 2 The founder of the e-commerce ● The US formally withdraws from shipping industry Page 04 giant steps down Page 04 the Intermediate-Range Nuclear Forces Treaty with Russia. Monthly Edition ⎥ Volume II ⎥ Issue 12 ⎥ September 2019 ⎥ Freely Distributed ● Saudi Arabia grants women the right to travel without permission from a male guardian. page 02

The energy component registered decline in August as crude oil fell with demand concerns outweighing ongo- ing supply risks. By contrast, precious metals like gold posted robust returns as investors moved into perceived safe haven assets. CRUDE OIL BREND $/bbl 59.3

GOLD $/toz 1,500.0 IsIs thethe page 08 GeopoliticalGeopolitical Investors have benefitted from ChessboardChessboard electronic trading Thomas Peterffy, the billionaire and founder NowNow Digital?Digital? of Interactive Brokers, who is sometimes re- Geopolitics is based on the nature of politics and relations defined by the real spaces in which we ferred to as the father of live. Over time thanks to technology these spaces have changed and have become much closer. The digital trading, believes that “ investors have benefitted from elec- seas that used to make a ground invasion impossible have become much smaller on a planet where Authored on Aug. 14, 2019 a nuclear strike could hit any location in the world in a matter of hours or some would speculate tronic trading, but he’s not a fan of via The Strategic Culture everything that has changed because Tim Kirby minutes. Technology has also opened up new spaces onto which a geopolitical logic can be applied. Foundation Independent In fact there is a surprising correlation between the layout of the world’s current military landscape of it. “Overall, the transactions costs journalist and its digital geopolitical landscape and this is not by some bit of random chance. have diminished greatly, However, it could be better.” ” page 09

K.Balkoudi Editor-in-chief MSCI WORLD Enduring growth he times when investors were able to enjoy a quiet summer seem to be EQUITY INDEX over. The escalation of tensions be- T tween the US and China, the sudden devaluation of the Chinese yuan, weak eco- concerns trigger a nomic data, electoral developments, increas- ing political uncertainties, an inversion in a The broad equity index that repre- closely watched part of the U.S. Treasury yield curve for the first time since 2007 and sents large and mid-cap equity mounting worries about a slowing economy performance across 23 developed “risk-off”reaction curbed investors’ risk appetite. August was markets countries declined by awful for stocks but September traditions 2.0% in US dollar terms in Au- could mean that more pain is still gust. World equity markets had a tumultuous August to come. page 05 page 05

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2 September 2019

EDITORIAL & German economy shrinks in Q2 2019, experts warn of the risk of recession. If the Germany economy stutters, the rest of Europe does and subsequently the rest of the world feels it. Graph Source: Destatis

CALENDAR Note from the Editor

Timeline for August 2019

A look at the big events around the world in the past month in politics, business, he International Day of Peace, years, the average level of global peace- economy, international relations, armed observed annually on Sept. 21 fulness has deteriorated by 3.78%. Vio- conflicts, attacks, disasters and more is a United Nations-sanctioned lence destabilises countries, impedes holiday. The awareness day was economic progress, and destroys civil- ✓ Aug.3 created via unanimous UN resolution in ian’s freedom to their basic human rights ●At least 22 people are killed and 24 others injured in 1981. Since then we have seen the face and dignities. The promotion of arms a mass shooting at a Walmart in El Paso, Texas, USA. of conflict change time and time again. sales and heavy spending on aggressive ✓ Aug. 4 Unfortunately, even between 2018- 2019, military capabilities is also heightening ●Iran seizes a foreign tanker reported to be Iraqi, in armed wars and violence wiped out world tensions, weighs on government the Persian Gulf, according to Iranian state media. decades of development gains across the budgets and burdens taxpayers. So it ●A mass shooting occurs at a bar in the Oregon His- world. According to the Global Peace seems rather superficial to solely dedicate toric District of Dayton, Ohio, USA. Nine people are Index (GPI) 2019 report the average level a single day for considerations of peace. killed and at least 27 others are injured. of global peacefulness improved very Every one of us can choose to make so- Source: Alert 2019! Report on conflicts, human rights and ✓ Aug. 5 slightly in the 2019 GPI. Over the last ten ciety more peaceful or more warlike. peacebuilding by Escola de Cultura de Pau, Spain ●China lets its currency drop to its lowest reported level since 2008 and also asks its state-owned compa- nies to halt imports of U.S. agricultural products. In response the U.S. Treasury Department designates China as a currency manipulator. OPINION ●In Hong Kong anti-extradition bill protests begin with citizens calling for a city-wide general strike. Over 200 flights were cancelled and the Hang Seng Index dropped sharply. Personalities and companies moving international finance ✓ Aug. 7 ●The death toll of a heat wave in Japan rises to 57. ✓ Aug. 8 Despite the summer slow- the combined group -but a separate subsidiary in the $283 million in funding to led the US$28 million in- ●Matteo Salvini, Italian Deputy Prime Minister, an- down, August, a month that less than 30% of the total next five years," Ambani develop an oil and gas vestment in the company. nounces the collapse of the coalition government with historically has proven to voting rights with Thomson told shareholders. project located offshore SmartNews, which has 200 the Five Stars Movement, opening the possibility of be full of surprises for the Reuters holding a 15% Trinidad and Tobago. Total employees, intends to hire holding a snap election. markets, was not short on stake. Commenting on the Deutsche Bank investment in the Ruby more and invest further in ✓ Aug.12 major deals. Aramco's transaction, David Schwim- invests €14.6mn Project, in which the US, where it said the ●After Argentine President Mauricio Macri comes move to acquire a 20% mer (pictured), CEO, LSE, BHP holds a app’s audience is increas- second in Argentina's primary elections, the coun- stake in India's Reliance said: "With the acquisition in Romania 68.5% stake, ing sixfold annually. Dr Ken try's peso loses 15% of its value against the US dollar. Industries' refining and of Refinitiv, we will trans- Deutsche Bank invests a is estimated Suzuki, a former researcher ✓ Aug.13 petrochemicals business form our position as a lead- further € 14 .6mn in DB to cost ap- at the University of Tokyo, ●The United States Trade Representative announces made news headlines and ing global Financial Markets Global Technology, the Ger- proximately started SmartNews in 2012. a delay until December 15 on a significant number of so did LSEG's acquisition Infrastructure group.” man lender's technology $500m. First SmartNews won numerous products affected by 10% import tariffs announced on of Refinitiv. Let's have a centre in Bucharest, to fur- production is expected in the “App of the Year” awards. August 1 and set to be imposed in September. look at who else moved Aramco to ther develop its business in 2021 calendar year and is ✓ Aug. 21 markets last month. acquire 20% Romania. The centre which estimated to increase pro- OTP acquires ●In the US, the Congressional Budget Office forecasts opened almost 6 years ago duction by ~16,000 barrels Mobiasbanca stake in RIL's develops financial applica- a deficit of $1 trillion next year. of oil per day (bop/d). "Ruby Hungary's OTP bank, Cen- ✓ petro arm tions for the bank's global Aug. 19 LSEG buys aligns well with our strategy tral Europe’s largest inde- ● operations. Mihai Ionescu, After fifteen days of raging fires in the Amazon For- Refinitiv in a $27 Saudi Aramco, the world’s of maximising value from pendent lender, purchased Chief Country Officer est in Rondonia, thick smoke clouds cover the Brazil- biggest oil producer will ac- our existing assets, bringing 96.69 per cent of the shares bn deal Deutsche Bank Romania ian city of Sao Paulo in darkness. quire a 20% stake in India's competitive near term value of Mobiasbanca, a Societe commented on the capital ✓ Aug. 23 The London Stock Ex- Reliance Industries’refining and volume growth," BHP Generale’s subsidiary in increase where he stated ●China retaliates on the United States' latest tariff de- change Group (LSEG) has and petrochem businesses president operations petro- Moldova. OTP acquired that it “reaffirms Deutsche cisions by imposing tariffs of up to 25% on some agreed to buy financial-in- for $15 billion. leum Geraldine Slattery the Chisinau based bank Bank’s commitment to American goods. President Trump announces an in- formation provider Refini- RIL is India’s said. through a number of trans- Romania, an economy that crease in the tariffs set to take effect on September 1, tiv for $27bn. The deal largest private actions. The Hungarian has confirmed and exceeded October 1 and December 15, from 10% and 25% to comes ten months sector com- Japan's Smart- lender first bought the our initial estimates regard- 15% and 30%, respectively. after private pany. Chair- news becomes shares with foreign capital ing the potential of the IT in- ✓ Aug. 26 equity group man Mukesh from French investment dustry, the existence of a unicorn ●Group of Seven leaders hold their yearly meeting Blackstone Ambani, Asia’s richest man, bank Societe Generale and robust flow of skilled spe- Japanese news discovery in Biarritz, France. acquired a announced the proposed then the remaining percent- cialists and a superior qual- app Smart News an- ✓ Aug. 27 majority stake transaction at the company’s age from Romania's BRD ity of the IT infrastructure.” nounced a new investment ●Poland anounces a planned national budget with zero in London-based 42nd annual general meet- bank, which is part of So- valuing the business at US$ deficit for the first time in 30 years. Refinitiv from Thomson ing. “Saudi Aramco will in- ciete Generale Group, for a BHP approves 1.1 billion. Japan ●Tropical Storm Dorian, the most powerful tropical Reuters Corp, valuing the vest in Reliance for a 20% total investment of almost Post Capital, a cyclone on record to strike the Bahamas estimated to business at the time at $20 stake in oil-to-chemicals di- 74.7 million lei. The deal $283m inves- fund man- have left behind an exceptional $7bn in property dam- billion including debt. vision at an enterprise value has been approved by the ment project aged by the age, is expected to grow stronger as it reaches Puerto Under the deal Refinitiv of $75 billion for the oil-to- National Bank of Moldova Australia based mining national mail Rico. shareholders will ultimately chemicals (O2C) division, (NBM). ✓ Aug. 28 hold around a 37% stake in which will be demerged into company BHP approved conglomerate, ●Pretoria, the administrative capital of South Africa, experiences widespread looting and violent attacks by rioters focused on foreigners. ●UK Prime Minister Boris Johnson asks Queen Eliz- ●Commerce Registry Code: ●Editor-in-chief: WORLD MARKETS ● abeth II to suspend Parliament until October 14. Fol- J40/12206/2016 Tel: +40 Kyriaki Balkoudi ● lowing precedent, the constitutional monarch ISSN 2668-1552 314.228.321 Emails: Publishing Consultant: ● approves the request. General Enquiries: Emanuel A. Kretikos ✓ [email protected] ●Accounting: Aug. 29 ● Published by ● ●China announces that it will not immediately retali- Advertising: Diplomat Conta Srl EuropaProPress Srl [email protected] ●DTP and Printing: ate on the latest U.S. import tariffs. ISSUE 12 SEPT. 2019 SEPT. 116 Constantin Brancoveanu Bd. ●Subscriptions: Triantafyllopouloi Bros LLP ●Oleksiy Honcharuk becomes the new Prime Minister Ap.138, District 4, Bucharest-Romania [email protected] Athens, Greece of Ukraine. WM 12FINAL_Layout 1 10/7/19 12:19 PM Page 3

September 2019 3

Plato (427-347 BC) Greek philosopher Around 2500 years ago, Plato, who was born to an aristocratic and influential POLICIES & family, could have chosen the affluent and powerful life of a politician. Instead, he chose to become a philosopher because he felt that this was the best way to serve the greater good. “There will be no end to the troubles of states, or of humanity itself, till philosophers become kings in this world, or till those we now call kings and rulers really and truly become philosophers, and political power and philoso- phy thus come into the same hands.” The Republic

COUNTRIES POLICIES PRIVATISATION & PUBLIC PRIVATE PARTNERSHIPS FDI inflows Regulations & Top 5 host Croatia hands economies 2018 Legislation out six onshore Imposition of currency controls, IN or many of the world’s exploration licences companies, the best in- lift of capital controls, FOCUS vestment opportunities Croatia awarded permits to four companies for gas aren’t always located within monetary stimulus promise and oil exploration on six blocks in the country’s flat their own domestic borders. In his column provides an international overview northern areas. Croatia’s largest energy group INA, 2018, total foreign direct invest- of new regulations and legislation, keeping local firm Crodux Derivati Dva, Vermilion Zagreb ment (FDI) was $1.3 trillion you ahead of developments so you can be able Exploration (part of Canada-based Vermilion) and globally, according to UNC- to make more efficient plans for your business. Last Aspect Croatia (the subsidiary of US oil company TAD’s World Investment Report Politician of the Aspect Holdings) are expected to invest some 78 month, Argentina’s imposition of currency controls 2019. million euro in exploratory activities. came just a week after Greece lifted its own restric- Month This represents the lowest level tions on moving money around. Meanwhile, China “This was the largest campaign to be launched for the exploration and exploitation of hydrocarbons in since the financial crisis and un- pledged more stilumus to support its economy and derlines the lack of growth in in- Kenya’s CBK approved NBK’s acquisition. Croatia in the last 20 years,” said the country’s min- ister of environmental protection and energy, Tomis- ternational investment this lav Ćorić. decade. If factors such as tax ARGENTINA The four companies have submitted bids for six of a reforms,megadeals and volatile Currency controls to total of seven blocks stretching over an area of financial flows are stripped out, 14,272 square km all located in Croatia’s Pannonian FDI over the past decade aver- prevent capital flight basin that were offered in a tender opened in late Oc- aged only 1% growth per year, Latin America’s third-largest economy, imposed currency tober 2018. Croatia’s prolific Pannonian basin is compared with 8% between controls on Sunday (Sept. 1) amid a debt crisis that has bat- well-known and has a long history of producing oil 2000 and 2007, and more than tered the peso. and gas fields. 20% before 2000. FDI is often Companies will have now to seek Central Bank of Argentina considered a win-win that (BCRA) permision to sell pesos to buy foreign currency and brings new capital and jobs to to make transfers abroad. Individuals looking to buy US dol- Egypt to offer nations, while simultaneously lars will be subject to a limit of 10,000 dollars a month. If Brazil rejects creating opportunities for corpo- they wish to buy more, they need BCRA permission. The stakes in two state- rations and investors. In 2019, measure does not limit companies or individuals from with- G7 offer FDI is expected to recover in drawing dollars from their bank accounts. The new measures owned companies developed economies, accord- will remain in place until the end of this year. On Aug.30 ing to the UNCTAD Report the peso slid another 1.74 pesos against the dollar, devaluing of $22m aid Egypt’s government is gearing up to implement the a total of 33.2% compared with August 2018. second wave of Initial Public Offerings (IPO) in which supports policymakers by monitoring global and re- GREECE JAIR BOLSONARO September which will include new sectors that do 38th President of Brazil not exist on the Egyptian stock exchange. Minister gional FDI trends. Capital controls lifted (1 January 2019 – present ) of the Public Business Sector Hisham Tawfik told Egyptian daily newspaper Al Ahram that prepara- 1. USA Greece fully lifted capital controls on September 1, follow- The Brazilian government through tions are underway to offer stakes in two state- ing four years of restrictions on international transfers by President Jair Bolsonaro said in Au- owned companies, including Banque du Caire companies and individuals. Athens imposed capital controls gust that is open to accepting financial (CBE). Official sources say that the government will in June 2015. At the time, the European Central Bank de- aid from organisations and foreign also offer a share of 10 to 15 percent of E- cided to pull the plug on emergency funding to Greek countries to help fight wildfires in the finance, which operates the government's financial Inflows in the US declined, lenders, forcing a three week shutdown of banks and a 60 Amazon rainforest on the condition network. The IPO programme is scheduled to be euro per day cap on cash machine withdrawals. Most re- that the funds must be under the fully implemented within three to five years over 23 by 9% from $277bn in 2017 cently, firms needed permission from Greece’s central bank country's control. Bolsonaro also re- companies and banks in various sectors, including to move sums greater than 100,000 euros per day outside the 2. CHINA iterated rejection of G7 money to as- real estate, services, petroleum, and chemicals. country, while individuals could transfer up to 4,000 euros sist the efforts unless French every two months. “In cooperation with the Bank of Greece, President Emmanuel Macron apolo- we are completely abolishing capital restrictions and restor- gised to him personally for perceived ing normality to capital flows,” the Greek Prime Every month this Minister Kyriakos Mitsotakis said in Parliament on August insults. The largest developing economy 26. column keeps you Tensions over up to date about FDI recipient, attracted $139 bn, CHINA an increase of 4%. Amazon fires September 2019 elections around More support to economy the world 3. HONG KONG The French president's office accused ▶ On Aug.31, the State Council of China issued a statement Bolsonaro of lying when he down- GERMANY saying that the Commerce Ministry of China had been look- played concerns over climate change State elections in Saxony were held on 1 September 2019, as required by the state constitution. On the same day ing to introduce further monetary stimulus on top of pre-ex- at the G20 summit in June. Paris also a state election also took place in Brandenburg. CDU isting fiscal supports. threatened to block a major trade came top in Saxony with 32%. In Brandenburg SPD won Besides, the State Council of China added in its Sept.1 state- deal between the EU and South with 26.2%. The special administrative re- ment that the upcoming monetary stimulus for Chinese America's Mercosur unless Brazil did gion achieved third place and in economy would involve robust investments regional devel- more to fight the fires. ▶ TUNISIA 2017 with $111bn opment alongside infrastructure project. The State Council The Brazilian leader has accused Presidential elections will be held on Sept.15. There are also added that the Chinese government had been seeking France and Germany of trying to buy 26 presidential candidates. If no candidate receives a ma- 4. SINGAPORE to roll out a prudent strategy to integrate the nation’s mone- Brazil's sovereignty after the G7 jority of the vote in the first round, a second round is held tary, financial alongside fiscal policies, to open up its finan- made a $20 million aid offer at the between the top two candidates. cial sector further and to introduce a sweeping capital market Biarritz summit hosted by Macron. overhaul. ▶ ISRAEL G7 members UK and Canada also Snap legislative elections will be held on Sept.17 to elect KENYA separately pledged additional mil- the 120 members of the twenty-second Knesset, the uni- In 2017, the island-state attracted lions in aid. "Brazilian sovereignty is cameral national legislature of Israel. $76bn CBK approves not negotiable," said Bolsonaro's spokesperson, according to the ▶ AFGHANISTAN 5.NETHERLANDS National Bank acquisition Reuters news agency. Politics and Presidential elections will be held on Sept.28. Seventeen men will contest the twice-delayed election. The Central Bank of Kenya (CBK) has approved the acqui- feelings aside, forest fires have sition of 100 per cent shareholding of National Bank Limited charred the Amazon in Brazil, which ▶ AUSTRIA (NBK) by KCB Group PLC. NBK was incorporated in 1968 accounts for more than half of the Legislative election will be held on Sept. 29 and will elect as a wholly-owned government entity but over the years had world's largest rainforest. The Brazil- the 27th National Council. The election was called fol- The completion of a number of shed its shareholding. The bank is listed on the Nairobi Se- ian space agency INPE has registered lowing the collapse of the governing coalition between megadeals resulted in higher flows curities Exchange and owns two subsidiaries: NBK Insur- 72,843 fires this year, the highest the Austrian People’s Party (ÖVP) and the Freedom Party to the country (up 20%) ance Agency Limited and Natbank Trustees and Investment number since records began in 2013. of Austria (FPÖ). WM 12FINAL_Layout 1 10/7/19 12:20 PM Page 4

4 September 2019

Angus Deaton (born 1945) Economist, Nobel laureate 2015 BUSINESS & Scotland-born economist and academic Angus Deaton won the Nobel Prize in Economic Sciences for a string of landmark findings on the study of consumption, poverty and welfare. Here are three quotes by him. On eco- nomic growth: “Economic growth is the engine of the escape from poverty and material deprivation.”On poverty measurements: “Poverty lines are as much political as scientific constructions.” On business: “Business have moved from doing business to doing lobbying, and I think that's a very bad thing.”

ECONOMIC VIEW LISTED COMPANIES NEWS Top 10 coun- LEADERSHIP Don’t blame Rio Tinto returns $3.5B tries by GDP Jack Ma steps to shareholders Growth 2019 Economics,blame Anglo-Australian multinational miner Rio Tinto an- down amid trade nounced it would be returning $3.5 billion to its share- holders, including an interim dividend of $2.5 billion ata from the Interna- public policy and a special dividend of $1.0 billion. The dividends tional Monetary Fund war uncertainty decision followed a half-year performance where Rio tells us that developing Public policy can- Asian and African coun- earned $20.7 billion in consolidated sales revenue, a ack Ma has officially not be learnt just by tries lead with fastest studying and real 9% increase over H1 2018. stepped down from the GDP growth in the world. J life cases are position of chairman at The Gross Domestic needed, argues Ri- the company he co-founded ex- Zalando books record Product of a country can cardo Hausmann, a actly 20 years ago. The announce- be defined as the total Venezuelan born ment was made a year ago, and Ma orders in Q2 monetary value of the economist in his remained in the role until Sept. 10, Europe’s largest online fashion retailer's customer base goods and services pro- post titled “Don’t 2019 to ensure a smooth transition. has grown to record highs. Zalando said active cus- duced within its borders in Blame Economics, In a letter to customers, employees and shareholders Ricardo tomer numbers now stands at 28.3 million across its 17 a year. It will be interest- Blame Public Pol- dated Sept.9, 2019, the charismatic entrepreneur, said Hausmann markets in Europe. The positive results prompted the ing to see how they all icy” published on he will be succeeded by Daniel Zhang, a former ac- Prof. at the Harvard German startup to raises its profitability outlook to the fare ten years from now. Sept.1 on Project countant and 12-year veteran at the company who be- Kennedy School of upper half of the adjusted EBIT range of €175 million Syndicate. came its CEO in 2015. Ma will stay on the Government & Director of to €225 million. Zalando's three co-CEOs - Robert GHANA Alibaba board of directors until the 2020 annual share- ausmann the Harvard Growth Lab Gentz, David Schneider, and Rubin Ritter - stand to rake in a combined €507m if they can more than triple holder meetings are concluded. He will also remain a w r i t e s member of the Alibaba Partnership. H that Public Policy needs to have a rela- the share price to €144.58 and roughly double the sales Ma, a former English teacher, has previously said he tionship to Economics like Engineering within five years. Zalando employs around 14,000 peo- will turn his attention to philanthropy, focusing on ed- has to Physics. It needs to teach like Medical ple from more than 130 countries. S.SUDAN ucation in rural areas. “The one thing I can promise Schools do. everyone is this: Alibaba was never about Jack Ma, but For that, it needs “teaching hospitals”, like the Har- Xiaomi to buy back up Jack Ma will forever belong to Alibaba.” Ma wrote in vard Growth Lab, which works to understand the the letter. dynamics of growth and to translate those insights to $1.5B of its shares Alibaba which listed in the New York stock exchange into more effective policymaking. “It is now cus- Smartphone giant Xiaomi announced it will buy back in 2014 in the largest IPO to date, has a market capi- tomary to blame economics or economists for up to HK$12 billion (S1.5B) worth of stock in its DOMINICA talisation of $460bn. The company's stock is up nearly many of the world’s ills. biggest equity repurchase. The move is Xiaomi's Critics hold economic theories responsible for ris- 30% year-to-date, despite the US-China trade war. The biggest equity repurchase plan since it got listed in ing inequality, a dearth of good jobs, financial two countries have set tariffs on hundreds of billions Hong Kong last year. In the second quarter of 2019, the fragility, and low growth, among other things. But of dollars of each other’s goods. Last November, Ma company is the fourth largest smartphone vendor in the although criticism may spur economists to greater called the US-China trade war the "stupidest thing in efforts, the concentrated onslaught against the pro- world, shipping 32.3 million units of handsets globally. RWANDA the world.” fession has unintentionally diverted attention from That was a year-on-year decline of 0.2 percent. Xi- a discipline that should shoulder more of the aomi's revenue growth also slowed down during the blame: public policy. Economics and public policy quarter ended in June 2019. are closely related, but they are not the same, and Angeliki Frangou, should not be seen as such. Kenya's Equity to buy Economics is to public policy what physics is to ETHIOPIA engineering, or biology to medicine. While physics majority stake in BCDC the visionary CEO is fundamental to the design of rockets that can use Kenya's Equity Group directors have approved the bank’s energy to defy gravity, Isaac Newton was not re- entry into a non-binding agreement to buy a controlling sponsible for the Challenger space shuttle disas- stake in Banqué Commerciale du Congo (BCDC), the sec- of Navios Group ter...Public-policy schools essentially stop teaching ond-largest lender in the Democratic Republic of Congo. COTE D'IVOIRE avios Maritime Holdings students after their first two years of mostly in- Although the value of the transaction has not been re- Inc. (NYSE: NM), a class education, and (aside from PhD programs) vealed, Equity Group announced that the deal will involve N global seaborne ship- do not offer the many additional years of training the exchange of cash for the controlling stake in BCDC. ping and logistics com- that medical schools provide. Equity Group Holdings Plc is one of the leading banks in pany, on Sept. 5 reported financial Yet the teaching-hospital model could be effective the East African region, with close to 14 million cus- results for the second quarter and in public policy, too.” tomers. BANGLADESH six month period ended June 30, 2019. Angeliki Frangou, Chairman and Chief Executive Officer, stated, “I am pleased with the August is usually quite a quiet month; stuck in the middle of the period that journalists often results of the second quarter of 2019 for which we re- call “silly season” a quiet period when there isn’t much to report. Not this year. Investors ported revenue of $147.2 million and Adjusted endured a volatile month. Uncertainty regarding trade between the US and China escalated EBITDA of $62.6 million.” fears of an already evident slowdown in economic growth. In turn, central banks expressed INDIA Navios Holdings, headquartered in Piraeus (Greece) their concerns and offered various plans to stimulate their respective economies. went on to make history as the first dry-bulk shipping company listed on a stock exchange. Ms. Frangou whose family has been in shipping for five generations, was born in Kardamyla on the island of Chios, Greece, a village with a long maritime history and homeland SENEGAL of many Greek shipowners. Armed with a degree in mechanical engineering and after a few years on Wall Street as a financial analyst Ms Frangou transitioned to shipping. Through her offensive of M&As together with her ability to raise capital, the group is valued more than CAMBODIA $4 billion. “I learned that in an industry filled with as- sets [and] vessels, the most precious asset of all was human resource. After all, it is the judgement of peo- ple, whether to buy or sell or repair or scrap, that had the most fundamental impact on the company” Ms. Frangou told European CEO in January 2018. We couldn't agree more. According to Lloyd’s List, she is Source: the first woman among the top 20 most influential peo- World Economic Out- ple within shipping industry in the world. Ms Frangou look (WEO) database received the 2019 Hellenic American Maritime Visio- April 2019 nary Award. WM 12FINAL_Layout 1 10/7/19 12:20 PM Page 5

September 2019 5

Victor Sperandeo (born 1945) Trader, index developer, financial commentator TRADING & Texas-based “Trader Vic” is renowned for having 'predicted' the stock market crash of 1987. According to him, the discipline of keeping your emotions under control is what makes or breaks a trader. “The single most important reason that peo- ple lose money is that they don't cut their losses short. It is a curiosity of human nature that no matter how many books talk about this rule, and no matter how many experts offer this advice, people keep making the same mistake."

MONTHLY MARKETS REWIEW MARKETS EXPERTS BROKERAGE FIRMS news Enduring growth Will September be a bumpy LIQUIDNET concerns trigger a month for stocks? IN Investors are still catching their breath from “risk-off” reaction the stock market’s characteristically wild % FOCUS swings in August. Let's see what markets ex- 12 perts have to say about what lies ahead as the Liquidnet, the US broker that Kyriaki I. Balkoudi Editor-in-chief September effect is not limited to US stocks. helps fund managers trade large blocks of shares, an- orld equity markets peers. Indian stocks shed about 3% Samuel Stovall nounced a new half year record posted their second lo- as a dispute with Pakistan resulted in Chief market strategist CFRA (USA) with volume traded in the Asia W sing month of 2019 in the suspension of bilateral trade. Pacific region increasing by August, a historically Southeast Asian markets weakened. Stock market investors may 12% compared to the same troublesome month. Escalation of In Thailand, the Philippines, Indone- be glad to see August go, first half period of the previous tensions between the US and China, sia and New Zealand central banks but September poses its year. Strong results were espe- the sudden devaluation of the Chi- cut their respective benchmark inte- own challenges. “If you cially evident with Hong Kong nese yuan, demonstrations in Hong rest rates as they stepped up efforts thought August was bad, and Australia. Kong, Brexit uncertainty, weak eco- to counter the economic impact history says September can nomic data especially in Germany, from the intensifying trade war. In Hedge fund be worse because not only is electoral developments in Argentina Hong Kong, the equity market fell it the month with the largest average decline, and worries about a slowing world sharply as escalating civil unrest in industry but is the only month to fall more frequently C. SCHWAB economy unnerved investors and the region weighed heavily on than it rises,” Samuel Stovall, chief market curbed their risk appetite. shares. strategist CFRA told CNBC. “If history re- performance peats itself we could see a selloff in September Americas Europe and then we have some sort of capitulation,” Major U.S. stock indexes declined European equities retreared as data negative in said Stovall. “We’re in the midst of what I call 20 % a pullback.” as August lived up to its reputation showed Germany, Europe’s largest According to Charles Schwab’s as the worst month for the market economy, is now on the verge of a August latest SDBA Indicators Report over the past decade. The tone of recession. The country issued nega- Aggregate monthly perform- Vikas Khemani ance for the hedge fund indus- only 20% of Self-Directed Bro- August was set on its first day with tive-yielding 30-year bonds for the Founder, Carnelian Capital (INDIA) kerage Accounts a tweet from the US president Do- first time. In the UK, where Queen try slipped into the red in Khemani has said one needs (SBDA) participants worked nald Trump who said that he would Elizabeth II granted Prime Minister August at -0.31%, the second to navigate the markets with an advisor; however, those impose a new round of tariffs on Boris Johnson’s request for a sus- negative month the industry has while having a perspec- who did had an average ba- Chinese imports starting Sept. 1. pension of Parliament in September, seen this year (May was the tive in the long term along lance of $448,515 nearly twice Shortly after, the People’s Bank of second-quarter GDP shrunk by 0.2% first), data from the research with an eye on the day-to- as much as the $234,673 held China let the yuan sink below 7 as Brexit is already weighing on the firm eVestment, a part of Nas- day developments. In an in- by non-advised participants. against the US dollar for the first economy. U.K. 30-year yields fell to daq, showed. terview with ETNOW on time since 2008. The White House all-time lows. Year to date (YTD) 2019 in- Aug. 22, he said: “Markets can tend to be lit- quickly punched back, formally la- dustry performance sits at tle bit more volatile, especially given that in- beling China a currency manipula- Emerging markets +6.97%. In spite of a mix of ternationally things are also reasonably tor. Washington's announcement of positive and negative monthly INTERACTIVE The emerging markets were hard hit volatile. I would say from now to next three- new tariffs also triggered retaliatory returns among hedge fund last month as trade tensions once four months of this calendar year, it would be measures from China. Latin Ameri- types in August, almost all seg- again sparked an investor flight from interesting to systematically build the portfo- can markets also declined, pressured ments of the industry are in the riskier assets. The MSCI EM Eu- lio because right now the distress is visible by a massive sell-off in Argentine green for performance YTD, rope, Middle East, and Africa Index highlighting the continued but recovery would happen. A lot of bad busi- 90% equities, which dropped over 40% dropped 7.29%, led by declines in nesses have exited, consolidation has hap- after the national primary election comeback of the industry from Turkey and S. Africa. South African pened, strong players are becoming stronger. Interactive brokers LLC is one results showed that the current go- 2018, when the industry and al- markets experienced their worst Au- You know when the recovery comes, you will of the fastest-growing, large vernment could lose power in Octo- most every segment ended the gust since 1998. not get these stocks at these prices. I would broker-dealers and has seen ber. year in the red. Managed Fu- tures funds were the big per- say over the next three-four months, it is a client accounts grow 16% per The times when investors were able formance winners in August, good time to buy. A great value is emerging year over the past six years and Asia-Pacific to enjoy a quiet summer seem to be returning +4.40% last month. in many sectors and stocks and so I would re- 20% in 2018. IBKR has man- Developed Asian markets were over. August was awful for stocks but And with YTD performance at main positive but you have to deal with the aged to grow its top line by broadly negative, but Japanese September traditions could mean +12.74%, Managed Futures volatility during this time. One does not need roughly 90% since 2015 or a stocks outperformed many of their that more pain is still to come. funds are among the big per- to extend a lot, one does not need to leverage CAGR of around 18% per year formance winners for the year a lot, one has to be systematically and pa- despite a non-volatile financial ◆ GRAPH of the Month so far as well. tiently investing. If a little bit correction market. IBKR has over 1,200 comes, one should be okay to live with that.” employees and is providing ac- Other figures cess to 120 markets in 31 coun- tries and 23 currencies all from Index Returns for in the data Dr Shane Oliver a single account. China-focused hedge funds Chief Economist AMP Capital (AUS) August 2019 (%) dipped into the red in Au- The Reserve Bank of Aus- Source: gust, returning -0.73%, but tralia (RBA) kept interest MSCI, FactSet, J.P. Morgan Economic with YTD performance at rates unchanged at a Research, J.P. Morgan, Asset Management. +15.14% they are the record low of 1% on DEUTSCHE BANK strongest performing hedge Sep. 3. Australian shares INDEX GBP USD JPY EUR LOC fund segment eVestment slipped fractionally fol- tracks. Russia and Brazil-fo- Equities (MSCI) lowing the announcement. cused funds are performing The central bank is still “waiting to see 800 MSCI World -1.5 -2.0 -4.2 -0.9 -1.9 well YTD as well, at what sort of boost to growth the rate cuts of +14.89% and +11.37% s o far June and July and the Federal Govern- MSCI USA -1.2 -1.7 -3.9 -0.7 -1.7 staff this year. India focused hedge ment’s tax cuts for low and middle income MSCI Europe -1.2 -1.7 -3.9 -0.6 -0.8 funds continued to suffer in earners provide,” Shane Oliver, head of in- Deutsche Bank is set to transfer MSCI UK -4.1 -4.7 -6.8 -3.6 -4.1 August, with returns at - vestment strategy and chief economist at up to 800 staff and its hedge MSCI Japan -0.5 -1.0 -3.2 -0.1 -3.2 5.95% for the month and rack- AMP Capital, wrote in a note following the fund-servicing prime brokerage MSCI AC Asia -3.8 -4.4 -6.5 -3.3 -3.3 ing up -9.69% returns YTD. RBA’s decision. “While these will help unit to BNP Paribas in a deal This continued the pain thes e avoid recession we doubt that they will be expected to be worth tens of bil- MSCI EM L.Am. -7.6 -8.1 -10.2 -7.1 -1.0 funds experienced in 2018, enough to generate decent growth and the lions of euros, the FT reported. MSCI EM -4.3 -4.8 -7.0 -3.8 -2.5 when India focused funds saw evidence from July is not that encourag- (Data as of 31 Aug. 2019) Aug. 31(Dataof as performance at -16.23%. ing,” Oliver added. WM 12FINAL_Layout 1 10/7/19 12:20 PM Page 6

6 September 2019

TRADING VENUES Bob van Dijk ( Group CEO of Prosus and Naspers ) Prosus (PRX), one of the largest technology investors in the world, was listed on Sept. 11 on Euronext Amsterdam. Prosus will become Europe’s largest listed consumer internet company by asset value. In addition to its listing on Euronext Amsterdam, Prosus will have a secondary listing on the JSE. “The listing of Prosus is an exciting step forwards for the group, giving global technology investors direct access to our unique and attractive portfolio of international consumer internet busnesses” said van Dijk.

-2.60% -1.81% -1.72% 0.22% -0.67% -0.70% -5.00% -2.05% -1.76% 1.57% -2.69% -3.06% NASDAQ S&P 500 DJIA TSX COMP BOVESPA CAC40 FTSE 100 DAX IBEX35 MOEX FTSE/JSE ASI ASX200 (USA) (USA) (USA) (CANADA) (BRAZIL) (FRANCE) (UK) (GERMANY) (SPAIN) (RUSSIA) (S.AFRICA) (AUSTRALIA) World's largest stock markets major indices performance August (Change % during previous month’s trading)

hance investors’ participation in the ■ CHILE - SANTIAGO Nigerian capital market. The launch ( Santiago Exchange ) will take place at the 2019 NSE Mar- ket Data Workshop taking place on Pioneering Sept. 11, 2019 . X-Mobile is de- signed to provide market partici- blockchain- pants, especially retail investors, convenient, faster and real-time ac- based stock cess to The Exchange’s activities. It trading in features market snapshots, stock prices, market analytics, financial ■ AUSTRALIA - SYDNEY, ( ASX) L. America news, dealing members directory and ■ DOHA, QATAR ( QE ) trade simulation. Commenting on the The Santiago Stock Exchange, the launch of app, Jude Chiemeka, the Central Securities Depository (DCV) FTSE Semi-Annual ASX, DA, VMware Divisional Head, Trading Business, and Global Trade Directory (GTD) will at NSE, noted: “The app will support form a blockchain association for sta- Index Review join forces on DLT our efforts at financial literacy and bilising the Chilean stock market and inclusion by bringing the capital mar- Qatar Stock Exchange announced that the results of The Australian Securities Exchange (ASX) has signed luring in domestic and international in- ket to the fingertips of market enthu- FTSE Semi-Annual Index Review published on August a three-party memorandum of understanding (MOU) vestors. siasts and spark new interest from 23rd 2019 will be effective on 19th September 2019 with Digital Asset (DA) and VMware to work together The association agreement, which was potential investors”. (after the close). The details of the semi-annual review on distributed ledger technology (DLT) initiatives in announced on Aug. 27 will allow the are as follows: Reclassifications: Qatar Fuel: reclassified Australia and New Zealand. creation of a consortium for the devel- ■ MOSCOW, RUSSIA from FTSE Mid Cap Index to Large Cap Index. Under the principles in the MOU, ASX plans to pro- opment of various Blockchain-based Barwa Real Estate: from Large Cap to Mid Cap. Al vide its DLT offering with the support of DA and applications for the financial market (MOEX) Meera: from Mid Cap to Small Caps Additions and dele- Vmware. DA is a world leader in DLT. VMware is a and is the first such initiative in Latin tions: Al Salam International: Addition to FTSE Micro New York Stock Exchange-listed server virtualisation America. Russian stock Cap Index. Qatar Oman Investment Company: Addition and cloud computing software provider. The agreement foresees the creation of to FTSE Micro Cap Index. Islamic Holding Group: Peter Hiom, ASX Deputy CEO, said: a Business Blockchain Network within market gained Deletion from FTSE Micro Cap Index. Qatar National “This new partnership is a very positive development 18 months: a new infrastructure meant Navigation and Transport Deletion from FTSE Micro that will help us support a wider range of DLT solu- to connect local and international stock 30% YTD Cap Index. It should be noted that the companies’ inclu- tions developed by the industry. market clients via a collection of nodes Russia’s stock market rallied in the sion and reclassification in global indices are subject to It confirms our belief in the potential of DLT as we re- that will provide access to the differ- second quarter of this year, up some various criteria, the most important of which are the size main on track to deliver the CHESS replacement sys- ent applications running on the Hyper- 30% since January. “Russian stocks of the company's investable capital and market capital- tem in March-April 2021.” ledger- based platform. The Exchange are among the best performers YTD ization, liquidity and turnover rates. has several markets, which currently across EM. The MSCI Russia has Periodic index reviews, carried out by international index trade over USD 2 billion a day in equi- gained +30% YTD, holding its posi- providers are among the main factors influencing the in- ties, fixed income securities, money tion as one of the leaders in the EM vestment appetite of international investors and portfolio market instruments, investment fund space. The RTS index tested the 1,400 managers. shares and foreign securities. level in June, returning to the area near our base case YE19F target of 1,250 in ■ NEW YORK, USA August. We keep that target un- BUCHAREST, ROMANIA (BVB) (NYSE) changed, since the biggest drivers of Russia’s outperformance, corporate Romania gets promoted governance improvements and sanc- Home to tions sentiment dissipation, lack fur- to EM status WARSAW, POLAND (GPW) technology ther triggers,” VTB Capital said in a Romania is promoted to Emerging Market from Frontier note. This year is turning out to be “a Market status, FTSE Russell announced on Sept.26. The innovators game of two halves” for the financial decision came after Romania has been retained on the Three Seas region NYSE raised $12.3 billion in tech pro- markets, according to VTBC. “The Watch List for three consecutive years. The reclassifica- ceeds from 11 tech IPOs, representing first half of the year tion from Frontier to Emerging status will become effec- exchanges launch 75 percent of all tech proceeds raised featured a decent equity market per- tive in September next year.The Bucharest Stock in the U.S. “In the biggest first half for formance, bolstered by expectations Exchange (BVB) has 84 companies listed on the Main CEEplus index capital raising since 2007, the NYSE of an early resolution to trade disputes Market alone, with a combined capitalization of EUR 36 furthered its leadership in tech listings, and above-trend growth. The billion. The upgrade to Emerging Market will allow the The heads of exchanges in the Visegrad Group coun- raising 75 percent of all U.S. tech IPO sell-off in the second half of the year Romanian capital market and the Romanian economy to tries (Poland, Czech Republic, Slovakia, Hungary), proceeds,” said Stacey Cunningham, was triggered by the Fed’s unclear ap- absorb new funds and send a strong signal to state-owned Croatia, Romania and Slovenia have signed a letter of President, NYSE Group. “Leading proach to looser policy and the in- as well as privately held companies that they have sig- intent concerning the publication of a new Three Seas technology companies consistently creased trade tensions that are raising nificant room to grow by using the stock exchange. region exchange index CEEplus. look to the NYSE to help raise capital, global recession risks,” VTBC said in The launch of the CEEplus index was officially an- increase visibility, provide liquidity for a note on the equity market outlook. nounced in the presence of the Polish Minister of In- ULAANBAATAR, MONGOLIA (MSE) early investors and employees, and es- vestment and Economic Development Jerzy tablish a currency for future mergers ■ HONG KONG (HKEX) Kwieciński at the 29th Economic Forum in the moun- and acquisitions. Importantly, this also H1 2019 report tain town of Krynica Zdrój, Poland. enables everyday investors to partici- Home Credit The Warsaw Stock Exchange (GPW) will be respon- pate in the success of these innovative highlights sible for the calculation and publication of the new gets green light companies.” index. The index portfolio will include more than 100 The Mongolian Stock Exchange (MSE) in H1 2019 of the largest and most liquid stocks listed on the ex- ■LAGOS, NIGERIA (NSE) to IPO traded total of 376.9 million shares worth MNT 82.3 bil- changes of the V4 countries and Croatia, Romania and Hong Kong Stock Exchange Listing lion on primary and secondary markets while 79.8 thou- Slovenia. committee has given the green light to sand units of Government bonds worth MNT 7.9 billion The participating stocks will have to meet the liquidity New app to Czech billionaire Petr Kellner's Home on secondary market. In total, the market turnover criterion: an average value of trading per session of at boost Credit to IPO. The consumer lender reached MNT 90.2 bn which showed an increase of 16.1 least 90,000 euro over a six-month period .CEEplus applied for a listing on the HKEX in percent or MNT 12.5 bn y-o-y. will be published daily, based on closing prices con- investors July. The offering was, however, sub- The market capitalization grew by 4.83 percent to MNT verted at the exchange rate of the National Bank of participation ject to the approval of the HKEX a 2.6 trillion as compared to the previous year. MSE ex- Poland for local currencies, the euro, and the US dol- final decision by the Home Credit perienced the record number of IPOs, 4 new issues in a lar. The launch of the new index is another step to- The Nigerian Stock Exchange (NSE) Group and the Home Credit BV half year, in the reporting period. The primary market wards unlocking CEE region's economic potential and is set to launch X-Mobile, a dynamic (HCBV) unit, market conditions, as trades amounted to MNT 42.5 billion which indicates a further strengthen its capital markets. and user-friendly mobile app, to en- well as various other factors. three-fold growth. WM 12FINAL_Layout 1 10/7/19 12:20 PM Page 7

September 2019 7 Data published on these pages, including prices, are indicative and not appropriate for trading purposes. Therefore they should not be relied upon when making an investment decision, they are for information purposes only.

Mark Peterson ( NZX CEO ) INDICES PRICES NZX has forecast funds under administration (FUA) in its investment platform could hit $50 billion by 2023. The NZX funds arm – covering superan- nuation and KiwiSaver provider SuperLife, and ETF business, Smartshares – re- ported about $3.5 billion under management as at June 30, up almost 20 per cent year-on-year. Mark Peterson, NZX chief, said in the group’s half-year report that the “steady move to low-cost, passive funds and growth in KiwiSaver” supported ongoing expansion for Smartshares and SuperLife.

-0.24% -1.58% 0.51% -7.39% -3.80% -2.80% -1.90% -0.85% -0.40% -5.88% -0.97% -3.33% SMI SSEC SSZSC HANGSENG NIKKEI 225 KOSPI TWII NIFTY 50 SENSEX STI JSX SETI (SWISS) (CHINA) (CHINA) (HONK KONG) (JAPAN) (S.KOREA) (TAIWAN) (INDIA) (INDIA) (SINGAPORE)(INDONESIA) (THAILAND)

1. AFRICA 63.BRAZIL Sao Paulo B3, General Index: -0.75% 1. ALGERIA Algiers SGBV BOVESPA: -0.67% 116.CZECH REPUBLIC Prague IPOs 2. ANGOLA Luanda BOVIDA 64.CHILE Santiago SSE, IPSA: -3.38% PSE, PX: -1.84% Most important list- 65.COLOMBIA Bogota BVC, 3. BOTSWANA Gaborone BSE 117.DENMARK Copenhagen NASDAQ, ings during H12019 4. CAPE VERDE Mindelo BVC COLCAP: -0.17% OMXC20: 3.27% 5. CAMEROON Duala DSX 66.ECUADOR Quito BVQ 118.ESTONIA Tallinn NASDAQ, 6. COTE D'IVOIRE Abidjan, BRVM, 67.HONDURAS Tagucigalpa BVC OMXT: -1.67% USA BRVM Composite: -2.66% 68.PARAGUAY Asuncion BVPASA 119.FINLAND Helsinki NASDAQ, 7. EGYPT Cairo EGX, 69.PERU Lima BVL, S&P Lima OMXHPI: -2.03% General: -4.26% EGX30: 10.77% 120.FRANCE Paris EURONEXT, LYFT ( NASDAQ ) 8. ETHIOPIA Addis Ababa ECX 70.URUGUAY Montevideo BVM CAC40: -0.70% 9. GABONE Libreville BVMAC 71.VENEZUELA Caracas BVC, 121.GERMANY Frankfurt FWB, 10.GHANA Accra GSE 3. ASIA PACIFIC DAX: -2.05% 11.KENYA Nairobi NSE, NASI: -0.45% 72.AUSTRALIA Sydney ASX, 122.GIBRALTAR Europort GSX $2.3bn 12.LESOTHO Maseru MSM ASX200: -3.06% 123.GREECE Athens ATHEX, 13.LIBYA Tripoli LSM 73.BANGLADESH Dhaka DSE, General Index: -3.5% Technology and transportation net- 14.MAGADAGASCARAntananarivo mex DSEX BROAD: -0.84% 124.HUNGARY Budapest BSE, work company Lyft raised over $2.3 15.MALAWI Blantyre MSE 74.BHUTAN Thimphu RSEBL BUX: -2.39% billion 16.MAURITIUS Port Louis SEM, 75.CAMBODIA Phom Penh CSX 125.ICELAND Reykjavik NASDAQ, MDEX: 0.08% 76.CHINA Shanghai SSE, OMXIPI -3.32% CHINA 17.MOROCCO Casablanca CASA Composite: -1.58% 126.IRELAND Dublin EURONEXT, SE, MASE: 0.81% 77.CHINAShenzhen SZSE, ISEQ: -3.79% 18.MOZAMBIQUE Maputo BVM Composite: 0.51% 127.ITALY Milan BORSA ITALIANA, 19.NAMIBIA Windhoek NSX, FTSE 78.HONG KONG Hong Kong HKEX, FTSE MIB: -0.35% CHINA EAST NSX OI: -4.09% HANG SENG: -7.39% 128.LATVIA Riga NASDAQ, ( HKEX ) 20.NIGERIA Lagos NSE, ASI -0.69% 79.INDIA Mumbai NSE, NIFTY50: OMXR: -1.65% EDU 21.RWANDA Kigali RSE - 0.85% 129.LITHUANIA Vilnius NASDAQ, 22.SEYCHELLES Victoria SSE 80.INDIA Mumbai BSE, SENSEX: OMXV: -0.90% 23.SOMALIA Mogadishu SSE -0.40% 130.LUXEMBOURG Lux/urg City 435.8m 24.SOUTH AFRICA Johannesburg JSE, 81.INDONESIA Jakarta IDX, LUXSE World FTSE/JSE ASI: -2.69% Composite: -0.97% 131.MALTA Valletta MSE China East Education raised over 25.SOUTH AFRICA Johannesburg, A2X 82.JAPAN Tokyo TSE, NIKKEI225: 132.MONTENEGRO Podgorica MNSE, $600bn in world's largest education 26.SOUTH AFRICA, Johannesburg, 4AX -3.80% MNSE10: -0.35% IPO by selling 435.8 million shares Markets 27.SOUTH AFRICA, Johannesburg, 83.LAOS Vientiane LSX 133.NETHERLANDSAmsterdam ZAR X 84.MALAYSIA Kuala Lumpur BM, EU RONEXT, AEX: -2.40% 28.SUDAN Khartoum KSE FTSE KLCI: -1.39% 134.NORTH MACEDONIA Skopje ITALY 29.SWAZILAND Mbabane SSX 85.MALDIVES Male MSE MSE,MBI10: 3.17% Dashboard 135.NORWAY Oslo OSLO BORS 30.TANZANIA Dar Es Salaam DSE, 86.MYANMAR Vientiane LSX DSE 0% 87.NEW ZEALAND Wellington NZX, EURONEXT, OBX: -0.37% One stop-shop 31.TUNISIA Tunis BVMT, TUNINDEX: NZX50: -0.93% 136.POLAND Warsaw GPW, NEXI 1.60% 88.NEPAL Kathmandu NEPSE WIG20 (PLN): -6.24% (BORSA ITALIANA) for Market 32.UGANDA Kampala USE 89.PAKISTAN Karachi PSE, 137.PORTUGAL Lisbon EURONEXT, 33.ZAMBIA Lusaka LUSE KSE100: -7.10% PSI20: -2.46% Watchers 34.ZIMBABWE Harare ZSE, 90.PHILIPPINES Manila PSE, 138.ROMANIA Bucharest BVB, BET (RON): 0.34% € 2.3bn INDZI: -11.34% PSE: -0.80% See at a glance the monthly 91.SINGAPORE Singapore SGX, 139.RUSSIA Moscow MOEX MOEX 2. AMERICAS 1.57% Private-equity-backed Italian pay- performnce of the main in- STI: -5.88% ment services firm Nexi SpA 35.BAHAMAS Nassau BISX 92.SOUTH KOREA Busan KREX, 140.RUSSIA Saint Petersburg dices of world stock markets. floated on the Italian stock ex- 36.BARBADOS S. Michael BSE KOSPI: -2.80% SPB Exchange All figures below refer to the 37.BERMUDA Hamilton BSX 141.SERBIA Belgrade BELEX, change following a €2.3bn private performance of August (MoM 93.SRI LANKA Colombo CSE 38.CANADA, Toronto CSE 94.TAIWAN Taipei TPEX,TWII -1.90% BELEX15: -0.33% placement change %). World Markets un- 39.CANADA, Toronto NEO 95.THAILAND Bangkong SET, 142.SLOVAKIA Bratislava BSSE, dertakes all reasonable efforts 40.CANADA Toronto TSX, SETI -3.33% SAX: -0.09% GERMANY to ensure the data included in TSX Composite: 0.22% 96.VIETNAM Ho Chi Minh City HOSE 143.SLOVENIA Ljubljana LJSE, this section was correct at the 41.CANADA Toronto TSX Venture SBITOP: -1.80% 42.CAYMAN ISLANDS Grand SXE 4. EURASIA 144.SPAIN Madrid BME, time of publication. 43.DOMINICAN REPUBLIC 97. ARMENIA Yerevan AMX IBEX35: -1.76% TRATON S.Domingo BVRD 98. AZERBAIJAN Baku BSE 145.SWEDEN Stockholm NASDAQ, 44.EL SALVADOR S. Salvador BVES 99. GEORGIA Tbilisi GSE OMXS30: -1.43% (DEUTSCHE BOERSE) 45.GUATEMALA G. City BNV 100.MONGOLIA Ulaanbaatar MSE 146.SWITZERLAND Zurich 46.JAMAICA Kingston JSE, JSE 101.KAZAKHSTAN Almaty KASE SIX -0.24% Index: -14% 102.KAZAKHSTAN Astana AIX 147.TURKEY Istanbul BORSA $1.5bn 47.MEXICO Mexico City BMV, 103.KYRGYSTAN Bishkek KSE 148.ISTANBUL, BIST100: -5.25% 104.TAJIKISTAN Dushanbe CASE IPC: 4.31% 149.UA Kiev UX Volkswagen’s manufacturer of com- 105.UZBEKISTAN Tashkent UZSE 150.UK London LSE, FTSE 100: 48.MEXICO Mexico City BIVA, FTSE -5.00% mercial vehicles which raised more BIBA: 4.32% 5. EUROPE 6. MIDDLE EAST than $1.5 billion made a lacklustre 49.NICARAGUA Managua BVDN 106.ALBANIA Tirana ALSE 151.BAHRAIN Manama BHB start on its debut. The stock opened 50.PANAMA Panama City BVP 107.AUSTRIA Vienna WIENER 152.JORDAN Amman ASE, 51.SAINT KITTS Basseterre ECSE at 27 euros, before slipping to trade BORSE, ATX : -2.47% All Share-2.84% as much as 2.4 percent lower. 52.TRINIDAD/TOBAGO TTSE 108.BELARUS Minsk BCSE 153.IRAN Tehran TSE, TEDPIX:11.7% 53.USA New York NYSE,DJIA:-1.72% 109.BELGIUM Brussels EURONEXT, 154.IRAQ Baghdad ISX, ISX 54.USA New York NYSE, BEL20: -3.53% Index: -1.43% BRAZIL S&P500: -1.81% 110.BOSNIA-HERZEGOVINA Banja 155.ISRAEL Tel Aviv TASE, TA35: 55.USA New York NASDAQ, Luka BLSE, BIRS: -4.12% 3.84% Composite: -2.60% 111.BOSNIA-HERZEGOVINA 156.KUWAIT Kuwait City BK NEOENERGIA (B3) 56.USA Boston NASDAQ BX Sarajevo SASE 157.LEBANON Beirut BSE 57.USA Chicago NYSE Chicago 112.BULGARIA Sofia BSE, 158.OM MAN Muscat MSM 58.USA Chicago CBOE SOFIX: -2.28% 159.PALESTINE Ramallah PEX For corrections 59.USA Miami MIAX 113.CHANNEL ISLANDS Guernsey 160.QATAR Doha QSE, QE -2.59% $1bn send an email at: 60.USA New York NASDAQ ISE TISE 161.SAUDI ARABIA Riyadh 61.USA Philadelphia NASDAQ PHLX Brazilian energy leader Neoener- [email protected] 114.CROATIA Zagreb ZSE, CROBEX: TADAWUL, TASI -8.16% 62.ARGENTINA Buenos Aires BCBA, -2.00% 162.UAE Abu Dhabi ADX, gia SA raised nearly $1bn. MERVAL: -41.49% 115.CYPRUS Nicosia CSE, General -2.86% WM 12FINAL_Layout 1 10/7/19 12:21 PM Page 8

8 September 2019 Data published on these pages, including prices, are indicative and not appropriate for trading purposes. Therefore they should not be relied upon when making an investment decision, they are for information purposes only.

Performance for U.S. Dollar Index, Euro/USD, British Pound/USD and Chinese Yuan/USD PRICES & during August 2019.The Yuan slided past the level of 7 per USD for the first time since 2008

●FUNDS World Government ● ETFs

NOTE: World funds performance during August 2019. • Direxion Daily Gold Miners (FXI) (EZU) Source: Investing.com Bear 3X Shares (DUST) Highest:41.5100 Lowest: Highest: 38.89 Lowest: 36.34 10-Year Bond Yield Highest:10.09 Lowest: 5.78 37.6600 Change:-4.81% Change: -1.48% Change: -33.75% • iShares MSCI Brazil Capped Change: 2.39% • iShares MSCI Japan (EWJ) ■ EUROPE • Energy Select Sector SPDR (EWZ)Highest:45.2850 Low- ■ AFRICA •Pimco Total Return ■ Argentina* Highest: 55.05 Lowest: 52.33 •Allan Gray Balanced •Amundi 12 M I (XLE) Highest: 62.300 Low- est:38.5100 Change: -7.88% Fund Institutional Highest: 33.46 Lowest: 28.38 Change: -0.79% Fund A(0P0000IR01) (0P0000P0VQ) est: 55.550 Change:-8.32% • iShares MSCI EAFE (EFA) Class (PTTRX) Change: 0.19% • VanEck Vectors Russia Highest: 103.751 Highest: 107,081.563 • Financial Select Sector SPDR Highest: 65.065 Lowest:61.260 Highest: 10.59 (RSX) Lowest: 101.431 Lowest:107,033.883 ■ Australia (XLF) Highest:28.4200 Low- Change: -1.92% Lowest: 10.40 Highest: 23.48 Lowest: 21.45 Change: 0.89% Change: 0.003% Highest: 1.212 Lowest: 0.850 est:25.9150 Change:-4.70% • iShares MSCI Emerging Change: 2.52% Change: -5.32% •Sanlam Namibia Ac- •Dws Deutschland Lc Change: -24.3% • Invesco QQQ Trust (QQQ) Markets ETF (EEM) Highest: •Prudential Total Re- • Vanguard FTSE Developed tive Fund A (0P00000CT1) ■ Belgium Highest:194.98 Lowest:179.20 42.1000 Lowest:38.7200 turn Bond Fund - Markets (VEA) Highest: 41.22 (0P0000JZKG) Highest: 216.810 Highest: 0.000 Lowest: -0.396 Change:-1.90% Change: 3.78% class Z (PDBZX) Highest: 11.256 Lowest: 200.150 Change: 186% • iShares China Large-Cap • iShares MSCI Eurozone Lowest: 38.79 Change:-1.88% Lowest:11.197 Highest: 15.11 Change: -2.2% Lowest: 14.83 ■ Brazil Change: 0.49% •Allianz Europe Highest: 7.700 Lowest: 7.100 Change: 2.31 Equity Growth Ct Change: 2.6% ■ AMERICAS •Schwab® S&p 500 Eur (0P00009QB4) ● CURRENCIES • American Funds Index Fund Highest: 245.160 ■ Canada Capital Income (SWPPX) Lowest: 232.320 Highest: 1.513 Lowest:1.083 NOTE: Major FOREX rates performance during August 2019 Builder® Class A Highest: 45.65 Change: -1.4% Change: -21% (CAIBX) Lowest: 43.95 •NN Euro Obligatie ■ China ■ AFRICA 0.7296 Lowest: 0.7181 US Dollar - Highest: 0.01580 Highest: 60.86 Change: -1.58% Fonds - P Highest: 3.194 Lowest: 3.015 • EGP/USD - Egyptian Pound ■ AMERICAS Lowest: 0.01490 Lowest: 59.64 •T. Rowe Price Blue (0P00000BA3) Change: -3.6% US Dollar - Highest: 0.06090 • PLN/USD - Polish Zloty US Change: -0.11% US Dollar Index Futures - Chip Growth Fund Highest: 37.210 ■ France Lowest:0.05985 Dollar - Highest: 0.2603 Low- • DFA US Large Cap Dec 19 (DX) - Highest: (TRBCX) Lowest: 36.330 Highest: 0.000 Lowest: -0.454 • ZAR/USD - South African est: 0.2500 Value Portfolio Insti- 98.970 Lowest: 96.980 Highest: 117.05 Change: 2.6% Change: 123% Rand US Dollar - Highest: tutional Class Lowest: 111.53 • USD/CAD - US Dollar ■ MIDDLE EAST (DFLVX) ■ MIDDLE ■ Germany 0.06990 Lowest:0.06455 Canadian Dollar - Highest: • TRY/USD - Turkish Lira US Change: -1.72% EAST • GHS/USD - Ghanaian Cedi Highest: 36.08 •Vanguard 500 Index Highest: 0.000 Lowest:-0.728 1.3346 Lowest: 1.3175 Dollar - Highest: 0.1837 Low- Lowest: 34.09 •Emirates Global Change: 59% US Dollar - Highest: 0.1886 • MXN/USD - Mexican Peso est: 0.1707 Fund Admiral Shares Sukuk Fund Change: -4.11% Lowest: 0.1810 US Dollar - Highest: 0.05230 • JOD/USD - Jordan Dinar (VFIAX) (LP65135728) ■ India • Dodge & Cox Inter- • USD/NGN-US Dollar Lowest: 0.04935 US Dollar - Highest: 1.4187 Highest: 272.84 Highest: 16.304 Highest: 6.639 Lowest: 6.296 national Stock Fund Nigerian Naira – Highest: • ARS/USD - Argentinian Lowest: 1.4090 Lowest:262.71 Lowest: 16.024 Change: 2.93% (DODFX) 307.500 Lowest:306.300 Peso US Dollar - Highest: • KWD/USD - Kuwaiti Dinar Change:-1.58% Change: 1.7% ■Indonesia Highest: 40.35 0.02280 Lowest: 0.01570 US Dollar - Highest: 3.3005 •Hsbc Amanah Saudi Highest: 7.729 Lowest: 7.227 ■ ASIA Lowest: 38.19 ■ ASIA • BRL/USD - Brazil Real US Lowest: 3.2793 Equity Fund Change: -0.32% • JPY/USD - Japanese Yen Change: -3.11 •Templeton Global Dollar – Highest:0.2625 Low- • ILS/USD - Israeli Shekel Total Return Fund (0P0000I27T) US Dollar-Highest: 0.00957 •Fidelity® 500 Index ■ Italy Lowest: 0.00915 est: 0.2384 US Dollar - Highest:0.2881 A(mdis)sgd Highest: 28.02 Highest: 1.829 Lowest: 0.929 Fund (FXAIX) Lowest: 26.85 • HKD/USD - Hong Kong Lowest: 0.2813 (0P00009VE7 Change: -33% ■ EUROPE Highest: 102.74 Change: -4.69% Dollar US Dollar - Highest: Lowest: 98.92 Highest: 9.590 • EUR/USD - Euro US Dollar ■ OCEANIA Lowest: 8.990 ■ Japan 0.1279 Lowest: 0.1274 - Highest: 1.1251 Lowest: • AUD/USD - Australian Dol- Change: -1.58% ■ OCEANIA Highest: 0.000 Lowest: -0.289 Change: -6.54% •Amp Capital En- • INR/USD - Indian Rupee 1.0963 lar US Dollar - Highest: •First Eagle Global Change: 77.4% US Dollar - Highest: 0.01452 Fund Class I (SGIIX) •Jpmorgan Japan hanced Index Internt • GBP/USD - British Pound 0.6869 Lowest: 0.6676 ■ Mexico Lowest: 0.01384 Highest: 58.06 Low- (yen) (acc) - Jpy Share (LP65021265) US Dollar - Highest: 1.2309 • NZD/USD - New Zealand Highest: 7.560 Lowest: 6.940 • KRW/USD - Korean Won est: 56.51 (0P00001DU1) Highest: 1.513 Lowest: 1.2015 Dollar US Dollar - Highest: Highest: 36,417.000 Change: -7.2% US Dollar - Highest: Change: -0.84% Lowest: 1.464 ■ Poland • EUR/CHF - Euro Swiss 0.6587 Lowest: 0.6283 •Franklin Income Lowest: 34,457.000 Change: 0.2% 0.000843 Lowest: 0.000817 Franc - Highest: 1.1024 Low- • FJD/USD - Fiji Dollar US Highest: 2.255 Lowest: 1.693 Fund Class A1 Change: -2.72% •Magellan Global • SGD/USD - Singapore Dol- est: 1.0834 Dollar – Highest: 0.4670 (FKINX) •Sun Life Mpf Hong Fund (0P00009H7Y) Change: -15.8% lar US Dollar – Highest: • RUB/USD - Russian Ruble Lowest: 0.4480 Highest: 2.29 Low- Kong Equity Fund A Highest:2.565 ■ Russia est: 2.24 (0P00008ST8) Lowest:2.450 Highest: 7.510 Lowest: 7.100 Highest: 6.301 Change: -1.30% Change:2.2% Change: -1.91% Lowest: 5.840 •Metropolitan West •Anz Kiwisaver- ■ South Africa COMMODITIES Change: -4.69% ● Total Return Bond growth Highest: 8.485 Lowest: 8.195 •Nomura India Eq- Fund Class I (0P00009UU2) Change: -1.1% Note: Monthly Average (Aug.2019) uity (0P0000A072) (MWTIX) Highest: 2.164 Highest: 23,533.000 ■ South Korea Source: World Bank Commodities Price Data (The Pink Sheet) Highest: 11.16 Lowest: 2.100 Lowest: 22,778.000 Highest: 1.410 Lowest: 1.147 Lowest: 10.96 Change: 0.03% Change: -1.01% Change: -6.9% ■ ENERGY ■ PRECIOUS $2.78/kg • Rice, Thailand 5% ■ Spain • Coal, Australia METALS • Coffee, Robusta $430.0/mt $1.56/kg • Rice, Vietnam 5% Highest: 0.330 Lowest: 0.023 $65.6/mt • Gold $1,500/toz Change: -47.7% • Coal, South Africa • Tea, Colombo $362.4/mt • Platinum $859/toz $2.84/kg • Sorghum $147.9/mt ■ Sweden $60.4/mt • Silver $17.2/toz CRYPTOCURRENCIES • Crude oil, Brent • Tea, Kolkata • Wheat, US HRW ● Highest: 0.000 Lowest: -0.353 $2.75/kg $181.1/mt $53.9/bbl ■ RAWMATERI- NOTE: Leading cryptocurrencies exchange rates during August Change: 6.4% • Tea, Mombasa • Wheat, US SRW • Crude oil, Dubai ALS TIMBER 2019 Source: Investing.com ■ Switzerland $2.13/kg $197.5/mt $58.9/bbl • Logs, Cameroon Highest: 0.000 Lowest:-1.132 • Crude oil, WTI $389.4/cum ■ FOOD-OILS ■ OTHERFOOD BTC/USD, Bitcoin US Dollar BSV/USD -Bitcoin SV US Dollar Change: 34% $54.8/bbl • Logs, Malaysia & MEALS • Meat, beef $4.60/kg Highest:12,291.9 Lowest: 9,343.0 – Highest: 160.00 Lowest: ■ Taiwan $280.2/cum ETH/USD -Ethereum US Dollar- 120.61 • Natural gas, Eu- • Coconut oil$719/mt • Meat, chicken Highest: 0.700 Lowest: 0.630 • Plywood Highest:237.47 Lowest: 106.01 XLM/USD - Stellar US Dollar - rope $3.68/mmbtu • Fishmeal $1,437/mt $1.90/kg Change: -1.44% ¢513.9/sheets XRP/USD - Ripple US Dollar - Highest: 0.08427 Lowest: • Natural gas, US • Groundnuts • Oranges $0.53/kg • Woodpulp Highest: 0.33075 Lowest: 0.06046 ■ Turkey $2.22/mmbtu $1,252/mt • Shrimp $13.05/kg $875.0/mt 0.24016 LEO/USD - LEO US Dollar - Highest: 16.500 Lowest:14.300 • Natural gas, LNG • Groundnut oil • Sugar, EU $0.36/kg USDT/USD- Tether US Dollar - Highest: 1.3471 Lowest: 1.1161 Change: 5.2% Japan $10.13/mmbtu ■ OTHER RAW $1,458/mt • Sugar, US $0.57/kg • Palm oil $586/mt Highest: 1.0094 Lowest: 0.9976 ADA/USD - Cardano US Dollar - • Sugar, World ■ UK ■ METALS & MATERIALS • Palmkernel oil BCH/USD - Bitcoin Cash US Highest: 0.06024 Lowest: $0.27/kg Highest: 0.632 Lowest: 0.405 • Cotton $1.56/kg $619/mt Dollar- Highest: 358.95 Lowest: 0.04326 MINERALS ■ FERTILISERS Change: -21% • Rubber, RSS3 • Soybean meal 270.67 XMR/USD - Monero US Dollar - • Aluminum ■ USA $1.50/kg $337/mt • DAP $292.9/mt LTC/USD - Litecoin US Dollar - Highest:97.72 Lowest: 65.71 $1,741/mt Highest: 2.061 Lowest: 1.443 • Rubber, TSR20 • Soyabean oil • Phosphate Rock Highest: 106.384 Lowest: 58.552 TRX/USD - Tron US Dollar - • Copper $5,709/mt Change: -25% $1.31/kg $793/mt $78/mt EOS/USD - EOS US Dollar - Highest: 0.023366 Lowest: • Iron Ore $93.1/dmt • Potassium Chlo- • Lead $2,045/mt ■AGRICULTURE • Soyabeans $363/mt Highest: 4.5665 Lowest: 3.0622 0.015065 *1-Year Bond Yield ride $265.5/mt BNB/USD - Binance Coin US HT/USD - Huobi Token US Dol- • Nickel $15,749/mt &BEVERAGES ■ GRAINS Note: Performance during Au- • TSP $275.0/mt Dollar - Highest: 31.7830 Lowest: lar - Highest: 5.3500 Lowest: • Tin $16,609/mt • Cocoa $2.10/kg • Barley $136/mt • Urea, E. Europe gust 2019 21.1701 3.7704 • Zinc $2,273/mt • Coffee, Arabica • Maize $163.6/mt $262.5/mt WM 12FINAL_Layout 1 10/7/19 12:48 PM Page 9

September 2019 9

Ray Dalio (born 1949) Hedge fund manager Bridgewater Associates founder Ray Dalio is worried that the cur- MARKETS OPINION & rent landscape is starting to resemble Depression-era conditions that could hammer investors. In a LinkedIn post on Aug. 28 he said high levels of debt and central banks’ ineffectiveness are two of the key factors that need watching. “If/when there is an economic downturn, that will produce serious problems in ways that are analogous to the ways that the confluence of those three influences pro- duced serious problems in the late 1930s.”

OPINION ANALYSIS INVESTMENT FLOWS THROUGH Trading is an Volfefe index IPOs H1 2019 industry in crisis measures impact IN of Trump’s tweets WORLD Kyriaki I. Balkoudi Editor-in-chief FOCUS on markets eth Merrin, the founder and CEO of Liquidnet, a New York-based company which develops and Traders know that when United deploys financial technology solutions for institu- States President Donald Trump takes to Twitter, he Investment flows through IPOs tional asset managers, warned that the trading industry is fell by 19.3% at the end of H1 in crisis. “I don't think it's an understatement to say that can move financial markets. But analysts at JPMorgan Chase & 2019 compared to H1 2018, we're an industry in crisis” Seth Merrin told The Finan- according to the WFE’s statis- cial News in an interview. “Before the financial crisis, OPINION Co. have created the "Volfefe" index - a nod to "covfefe", the mysterious tics. This was due to a decline anywhere that you looked inside of investment banks, or Josh in investment flows in Asia-Pa- inside of assent management it was just high margin, word coined by Trump in an unfin- Younger, ished 2017 tweet -to gauge the impact cific and a greater decline in high profit. That’s just not the case today. Both sides of Analyst at JP the EMEA region. The Ameri- of President’s tweets on U.S. interest the fence are under severe margin compression” said the Morgan cas region recorded an in- rates. “Trade and monetary policy serial entrepreneur who has won several awards for his crease in investment flows. innovation and influence in the financial services indus- have become an increasing focus for the executive try. According to Merrin, Deutsche Bank's decision to branch, and everything from casual sentiments to seem- exit the stock sales and trading business, was a “really ingly formal policy intentions have been disseminated, ASIA PACIFIC defining moment” for the industry. In July, the Frankfurt- globally and instantaneously, via this carefully scruti- headquartered bank announced it would drop its stock nized social media platform,” JPMorgan analysts led by sales and trading unit as part of a plan to exit more Josh Younger (pictured) and Munier Salem wrote. volatile investment banking activities. “Never before in “In response, a broad swath of assets, from single-name history has a major bank pulled out of equities trading. stocks to macro products, have found their price dynam- Never” said the Liquidnet boss. ics increasingly beholden to a handful of tweets from Despite the decline in invest- Tougher regulation like the Markets in Financial Instru- the commander in chief.” The president - or aides - have ment flows, Asia-Pacific region ments Directive (MiFID) II rolled out last year, has also averaged roughly 10 tweets a day since the start of held the lion’s share of global weighed on the industry. Investors have 2016, with 10,000 tweets sent since his inauguration in IPOs, drawing almost 60% of Mifid I was orginally introduced in 2007 and provided 2017, according to JPMorgan’s analysis. Trump's most IPOs worldwide. HKEX harmonised regulation for investment services across the benefitted market-moving tweets dwell on trade, and, to a lesser recorded the highest number 31 member states of the European Economic Area. Its extent, monetary policy - with the words "China", "bil- of IPOs in the region main focus was on stocks, but Mifid II brought other from electronic lion", "products", "dollars", "tariffs" and "trade" making (63). Some major IPOs In the asset classes into scope, including fixed income, deriva- the top list. It just remains to be seen if the Volfefe Index region were Hansoh Pharma- tives and exchange-traded funds. The rules require that trade is effective. ceutical Group (HKEX). fund managers pay brokers and banks separately for re- search and trading services, rather than just one combined Thomas Peterffy, the billionaire founder of Interactive Brokers, be- fee for both activities in a bid to avoid conflicts of inter- AMERICAS lieves that investors have benefit- est. The changes have prompted warnings that some ana- ted from electronic trading, but lysts could lose their jobs. he’s not a fan of everything that MARKET RESEARCH has changed because of it. “Over- Reinventing how all, the transactions costs have Wall Street can work diminished greatly,” the Hungar- EMs success- ian-born trading pioneer told IPO investment flows in the Merrin founded Liquidnet, of one of the largest independ- Quartz. “However, it could be bet- Americas region were up de- ent brokers on Wall Street, in 1999 and prior to that was ter.” fully navigate spite the decline in the number co-founder of VIE Systems Inc, a financial services ap- Peterffy, who is sometimes re- of listings thanks to several plication integration software company. The first com- ferred to as the father of digital the volatile large IPOs, such as technology pany he established was Merrin Financial, in 1985, trading says his experience in the and transportation network launching the industry’s first order management, compli- market-making business has given environment company Lyft (Nasdaq), that ance and electronic order routing systems for asset man- him insight into how modern trad- raised over 2.3 Billion USD; pet agers which was acquired by ADP in 1996. Prior to ing works. “In my view, market Negative sentiment by sovereign wealth funds (SWF) food company Chewy (NYSE), 1985, Merrin was a risk arbitrage trader for CIBC Oppen- structure hasn’t changed much, it’s toward equities mostly faded in the second quarter, with that raised over 1 Billion USD; heimer and. As an intern on Wall Street in the early just been speeded up,” he demand for passive emerging market (EM) equity ex- and utility/energy company 1980s, he had a unique view of how the financial epicen- said. ”That makes it harder to posure increasing, data from the research firm eVest- Neoenergia (B3), that raised ter operated and saw a way he could change it for the bet- know what’s going on, compared ment, a part of Nasdaq, showed. nearly 1 bn USD. In H1 2019, ter. .Merrin is also the author of “The Power of Positive with the floor trading days. It was Passively managed equity funds outside the United the NYSE was the market that Destruction: How to Turn a Business Idea Into a Revolu- more visible. Things are the same States took in $1.77 billion from sovereign investors recorded the highest amount of tion” a book which reveals how to start a new business, now, just much faster.” during the quarter, while emerging-market passive eq- fund raised through IPOs in the Peterffy was born in Hungary in disrupt an industry, and adapt to changing environments uity funds brought in $1.92 billion during the same pe- Americas region, accounted 1944 and arrived in America in by leveraging technology and a new mindset. Liquidnet riod. for 16.8 Billion USD. 1965 at age 21. In 1977 he bought connects more than 700 of the world’s leading asset man- Meanwhile, strong performance of EM hedge funds ex- a seat on the American Stock Ex- agers to large-scale equity trading opportunities in 43 eq- tended the prior quarter’s record level of total EM cap- change (AMEX) and becames a uity markets across five continents. ital to end 2Q at $239.3 billion an increase of $5.3 EMEA member, trading as an individual billion from 1Q, data from HFR Emerging Markets PHOTO: Seth Merrin, founder and CEO of Liquidnet market maker in equity options. He founded Interactive Brokers in Hedge Fund Industry Report from HFR showed. EM 1993. hedge fund performance was led by the HFRI EM: The online brokerage company’s Russia/Eastern Europe Index, which surged +15.9 per- second-quarter revenues ticked cent YTD through July, topping all global hedge fund down 7 percent year-over-year, to strategy indices for 2019. Despite Brexit uncertainty's $413 million. Profits came to $32 Other EM regions also successfully navigated the negative influence on the million, compared with $41 mil- volatile currency and fixed income trading environ- number of listings and invest- lion in the same period a year ago. ment, as the HFRI EM: ment flows in the EMEA re- The company employed about Latin America Index surged +14.5 percent YTD gion, the London Stock 1,400 worldwide at the end of through July, while the HFRI EM: China Index ad- Exchange Group (LSEG) 2018. vanced +13.0 percent. Hedge fund focused on the Mid- listed 32 IPOs, which raised Peterffy is the 65th richest person dle East, as well as those focused on developed Asia nearly 5.9 Billion USD. These in the entire world with $16.7bil- have also gained on the year, with the HFRI EM: included some of the largest lion, according to Bloomberg Bil- MENA Index advancing +5.5 percent, and the HFRI IPOs globally, such as Nexi. lionaire Index. Japan Index adding +4.7 percent YTD. 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10 September 2019 AFRICA

Jack Bogle (1929-2019) SPECIAL ECO- Founder of Vanguard Group INVESTORS & The American investor, business magnate, and philan- NOMIC ZONES thropist who is credited with creating the first index fund, is widely seen as having changed how ordinary people invest their money. “Your success in investing will de- 237zones pend in part on your character and guts and in part on your ability to realize, at the height of ebullience and the depth of despair alike, that this too, shall pass.” The growing number of special economic zones (SEZs) could become an- other factor in drawing in- vestment to the continent in the coming years, accord- PENSION FUNDS ing to UNCTAD. There are WORLD TRENDS IN an estimated 237 SEZs in Africa, with the highest number in Kenya (61). Top 20 pension Investment trends are an im- minus long-term interest rates - AMERICAS portant indicator of how any - compared with the mid-2 industry is doing. range in London and 1-some- funds’ AUM declines This column offers insights thing in New York. into major players in capital ssets under management (AUM) at the total portfolio ap- REAL ESTATE markets like sovereign wealth Franklin Tem- the world’s 300 largest pension funds proach and universal funds, financial firms and oth- pleton to use fell in value by 0.4% to a total of ownership gain trac- ers helping investrors pinpoint US$18 trillion in 2018, in sharp con- tion in these organisa- winning strategies and tactics blockchain trast to a 15.1% gain in 2017, according to the tions, they influence 37% that create and cement com- for new fund latest World 300 research from the Thinking the whole market. It’s petitive edge. Bob Collie, Head International investors made California-based Franklin Tem- Ahead Institute (TAI). The research shows that particularly notable of Research for the direct acquisitions totaling Australian pleton Investments filed a pre- the value of the top 20 pension funds’ AUM fell that a majority of the Thinking Ahead $21.3 billion in H1 2019 in liminary prospectus with the by 1.6% in 2018, equating to 40.7% of the total largest funds are now Group the the US but sold a little bit Super, OTTP U.S. Securities and Exchange AUM in the rankings. This is the first year since highlighting the impor- more at $21.4 billion, ac- to invest in NIIF Commission on September 3rd, 2012 that the top 20 funds’ share of the total tance of sustainability. ESG factors are now sig- cording to Real Capital An- for a money market fund whose AUM has fallen.However, the top 20 funds’ nificant financial considerations. Beyond that, India’s sovereign wealth fund alytics. In Q2 alone, shares would be recorded on growth rate of 4.7% during the period 2013 to there’s also an evolving recognition of the role manager National Investment acquisitions dropped 37% the Stellar blockchain. The 2018 remained higher than the growth rate of large investors play within society, and the re- & Infrastructure Fund Ltd from a year ago. fund will be primarily com- 3.9% for the top 300 funds during the same pe- sponsibility that comes with it ”Bob Collie, (NIIF) said Ontario Teachers’ prised of government securities, riod. Head of Research for the Thinking Ahead Pension Plan (OTTP), one of cash, and repurchase agree- Group, said. Canada’s largest single-profes- Investment & ASIA ments which are fully collater- North America remains the largest region in sion pension plans, and Aus- alised by either government Responsibility terms of AUM and number of funds, accounting tralianSuper, Australia’s securities or cash. Investments “A tougher market environment in 2018 meant for 45.2% of all assets in the research, followed biggest retirement fund, will entail shares that are is- AUM growth paused, but the underlying trend by Asia-Pacific (26.2%) and Europe (24.9%). STARTUPS planned to invest a total of $2 sued, transferred, and managed remains one of growing pension markets world- On a weighted average for the top 20, assets are billion in its Master Fund. Both on a blockchain, but no cryp- wide. The pace of change in the investment predominantly invested in equities (44.5%) fol- Ontario Teachers’ and Aus- tocurrencies will be involved. world is a challenge, and scale is a huge advan- lowed by fixed income (37.2%) and alternatives tralianSuper have each signed $246m The prospectus says Franklin tage in a lot of ways. Many of the most interest- and cash (18.3%). The Thinking Ahead Institute agreements for investments of Templeton believes blockchain- ing and important developments start with the (TAI) was established in January 2015 and aims up to $1 billion in the fund, Startup investment in Viet- based shares provide trans- largest funds, and as new investment ideas like to “change investment for the better”. NIIF said in a statement. Aus- parency for shareholders but nam hit $246 million this tralianSuper and Ontario warns they come with their year through June on 56 Teachers’ will now join the own risks, including hacking deals, according to joint re- Government of India (GOI), and loss of funds. Franklin search by ESP Capital and Abu Dhabi Investment Author- INVEST IN YOURSELF Templeton ranks among the top Cento Ventures. Invest- ity (ADIA), Temasek, HDFC 35 mutual fund managers. ment is expected to top Group, ICICI Bank, Kotak $800 million by the end of Mahindra Life Insurance and China to boost Self-investment the year. Axis Bank as investors in the fund. The Master Fund has a investment AUSTRALIA tenure of 15 years and is de- and why it's worth it nominated in Indian rupees to in Hong Kong suit the requirements of the in- China has called on its largest eople talk all the time about investing spiritually and finan- frastructure sector. state-run companies to take a money. In today’s volatile world, mar- cially, will allow you to Investing FDI more active role in Hong Kong, kets can crash, stocks and bonds can become the best version in Humans Overseas including stepping up invest- be lost, material possessions can burn. of yourself. When you investors dive ment and asserting more con- Whether you are an investor, an entrepreneur or put money in most in- In October 2018, A$3.5tn trol of firms in the financial an employee, if you invest in yourself, you can vestment vehicles, you the World Bank into Japan's hub, Reuters reported citing ex- earn returns that will last your lifetime. Your may or may not realize released the Human Foreign economies had a ecutives familiar with the mat- knowledge, skills, and experience remain with a return, no matter how Capital Index total of A$3.5 trillion in- property market ter. At a meeting held in you even when you have lost everything. By im- safe the bet seems, and aimed at encourag- vested in Australia at the Major property deals are taking Shenzhen, the city bordering proving your talents and abilities, you’re invest- no matter who else ing more meaning- end of 2018. The US and place across the world, with the Hong Kong, senior representa- ing in something that you will always have; might be making the ful investment in UK are the biggest in- total value of deals rising 4% tives from nearly 100 of nobody can tax it or take it away from you. You same investment. There people to acceler- vestors in Australia, fol- from the previous quarter to China’s biggest state firms are the most valuable asset you will ever own, is simply no vehicle ate economic growth and equity. lowed by Belgium, Japan $174 billion worldwide for pledged to invest more in key the one with the highest profit potential and also more certain to provide Forms of invest- and Hong Kong. April to June, according to JLL, Hong Kong industries includ- the greatest opportunity for improvement. As a return that exceeds the a financial and professional ser- ing real estate and tourism in a quoted by one of the most famous investors of investment you make in ment in human vices firm that specialises in bid to create jobs for local citi- all time, Warren Buffett, “ultimately, there’s one yourself. Investing in capital include EUROPE commercial real estate serv- zens and stabilise financial investment that supersedes all others: Invest in oneself isn’t an easy increased wages, ices and investment manage- markets. yourself.” There are plenty of ways to invest in road, even after you education and ment. Japan's property market Hong Kong in September en- yourself. Here’s a look at a few worthwhile in- make the decision to training, improved FINANCIAL is drawing particular interest tered its fourth month of mass vestments that can produce excellent rewards: commit. There will al- healthcare. because of the Bank Of Japan's protests. An extradition bill that Meditation, fitness, education, reading more ways be distractions INVESTMENTS negative-rate policy. Prime would allow suspects to be sent books, taking care of your health, spending time and ways to spend your time elsewhere, but it’s Tokyo office buildings offer a to mainland China, triggered in nature, creative pursuits, taking courses, de- crucial to take some time to invest in your own 2.9 percentage point yield unrest and threw the former veloping good habits and breaking bad ones. In- health, social relationships, and overall emotional $318m spread -- the investment yield British colony into crisis. vesting in yourself emotionally, physically, well-being. FDI in the Ukrainian econ- omy grew by $840 million to $33.7 billion in equity capital Booking Deadline for your Advertisment 10 December 2019 during the first six months of SPECIAL EDITION 2019, a 2.6% increase com- pared with the correspon- Coming out ding period of last year. The highest share of foreign in- Jan. 12th 2020 vestment ($318.5 million) went to the financial and in- surance sector. 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Branco Milanovic Economist “Market and the invisible hand indeed turn out to be the almost mira- culous contraptions. They transform this landscape of hard men, in- ured to bleakness, pursuit of self-interest and cheating, into a tolerably civilized society. That way, people treat each other with consideration, at least on the surface. But, I think, there is no doubt to anyone who has read the Wealth of Nations that this is only a veneer. Once it cracks, we are quickly back in the animal kingdom, as we indeed got there during wars, colonial conquests or crusades.” you HAVE

ON WEALTH BOOKSTORES: Amazon: $24.83 Barnes & Noble: $24.35 Waterstones: £ 22.99 T h e We a l t h o f N a t i o n s

"An Inquiry into the Nature and Causes of the Wealth of Nations"

"No society robably the most influential book on market economics ever can surely be flour- written, "An Inquiry into the Nature and Causes of the Wealth ishing and happy, of of Nations"—commonly referred to as simply "The Wealth of Nations" (1776) by Adam Smith, was published, with neat co- which the far greater incidence, in the very year that history's greatest capitalist nation declared part of the members its independence. This strange fact lends added significance to the Scot- tish philosopher's prediction that the Americans “will be one of the fore- Edinburgh: are poor and mis- most nations of the world”. Printed for erable." Adam Black, Five editions of The Wealth of Nations were published during Smith's lifetime: and William in 1776, 1778, 1784, 1786 and 1789. The original volume was published as five Tait, and separate books in a collection. Book I: Of the Causes of Improvement Longman, in the productive Powers of Labour Rees, Orme, Book II: Of the Nature, Accumulation, and Employment of Stock Book III: Of Brown, and the different Progress of Opulence in different Nations Book IV: Of Systems of Green Adam Smith political Economy Book V: Of the Revenue of the Sovereign or Commonwealth London The first edition sold out in six months, shocking its publisher. Numerous editions M.DCCC.X A Brief Biography of Adam appeared after Smith's death in 1790. Smith's biographer John Rae contends XVIII Smith (1723-1790) that The Wealth of Nations shaped government policy soon after it was pub- Born in 1723, Adam Smith was lished. The year following its publication Smith was the son of a customs official in appointed commissioner both of customs and of salt duties for Scotland. With The division of labour Kirkcaldy, Scotland. At 14, he 36,331 citations, the massive work of almost 1,000 pages, is the second most entered the University of Glas- cited book in the social sciences published before 1950, Another central theme was that productive capacity rests on the division of gow to study moral philosophy. behind KarlMarx's Das Kapital and is regarded labour. How wealthy a country becomes depends more than anything on the or- After graduating, he attended as the foundation of economics and the ganisation of its labour force, specifically, as he put it, the “skill, dexterity, and Oxford in England. In 1748 he intellectual cradle of capitalism. The judgment with which its labour is generally applied”.Smith’s third theme is that began giving public lectures in book was based on Smith's exhaus- a country’s future income depends upon the accumulation of capital that such Edinburgh, and in 1751 was ap- tive research and personalobserva- activity makes possible. The more that is invested in better productive processes, pointed to a chair of logic, later tions and offers one of the world's the more wealth will be created in the future. Smith provides moral philosophy, at Glasgow first collected descriptions of a simple recipe for how countries can become wealthy, which begins with their University. He published The what builds nations' wealth. citizens being good savers. These savings are then invested toward productive Theory of Moral It introduced new economic ends. The other avenue by which countries could grow rich is trade. Sentiments in 1759, em- principles—principles that bodying some of his Glas- continue to govern the world Government itself must be limited gow lectures. Following in today. A fourth theme is that this system is automatic. Where things are scarce, his father’s footsteps, in people are prepared to pay more for them, 1778 he was appointed Where there is a glut, prices and profits are low But the system is automatic only commissioner of customs Self- when there is free trade and competition. When he writes about free trade, Smith in Edinburgh. interest& is reacting against the dominant form of economics in his time, which was called He died in 1790, well mercantilism. Smith attacked government intervention in the economy arguing regarded by all who prosperity that stringent regulations imposed on commerce are knew him. At the heart of The Wealth of ill-founded and counterproductive. The Wealth of Nations says that competition Nations is the suggestion that and free exchange are under threat from people's need to fulfill natural governments granting subsidies or monopolies or other privileges to favoured self-interest results in greater producers. However Smith argued that some things can't possibly function well prosperity. “By pursuing his in the free market, so they need to be run by the government for the sake of the own interest he frequently promotes greater good. Smith insisted there were only a few areas where government that of the society more effectively should have a role: Protecting a society from invasion. Protecting citizens “from than when he really intends to the injustice or oppression of every other member of it” with a corresponding promote it" Smith wrote. He judicial system. Building and maintaining public works and institutions that are believed that people pro- too expensive for a single individual to undertake, but would benefit society mote public interest greatly as a whole. Promoting education. through economic choices—a free-market Our opinion force that became known Smith’s ideas influenced the politicians and changed events. He did for econo- as the "invisible hand." mics what Newton did for physics and Darwin did for biology.His ideas led to In his view, economic trade treaties, tax reform, and an unwinding of tariffs and subsidies that in turn freedom was not a mere unleashed the great nineteenth-century era of free trade and growing world pros- end in itself, but rather perity. Smith’s world was very different to ours, of course. the indispensable means He took the outdated, received wisdom about trade, commerce, and public policy, to a greater end, namely and re-stated them according to completely new principles, giving us a vision of that of promoting plenty and freedom for all. We can still rediscover his wisdom as he leaves us human flourishing in with a powerful set of solutions to modern day problems. His work provides a its economic, politi- rationale of inestimable importance for practical economic policy. cal, and moral dimen- But the question remains why there is no will to use and apply his ideas for the sions. prosperity of all? WM 12FINAL_Layout 1 10/7/19 12:49 PM Page 12

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The Big Portait is a page dedicated to people in business, finance, investment, academia, technology, science, public administration and more who excel in their field and with their personality, work and theBIGportrait achievements empower and inspire others.

● Famous Investors ● Peter Lynch, a Chameleon Investor

legend in the mutual fund industry, Peter Lynch, was born on 19 January 1944 in Newton, Massa- chusetts, USA. His father died when he was 10 A and when he was 11 he took the small job of a Golf Caddy at Brae Burn Country Club outside Boston where he met people who had a good knowledge of stocks and investments. His caddying earned him a financial aid scholarship and got graduated in Finance from Boston Col- lege in 1965. He further earned a Master’s degree in Business Adminis- tration from Wharton School of the University of Pennsyl- vania. In 1966, Lynch was hired as an intern with Fidelity Investments, partly because he had been caddying for Fi- delity's president, D. George Sullivan, (among others) at the golf club. In 1969 he was permanently hired by Fidelity as the Research Analyst. In 1974, Lynch graduated to the position of the Re- search Director of the Fidelity. He held that position till 1977. This was the milestone year of his life. He was made the Head of the Magellan Fund where he generated returns of approximately 29% annually, creating fortunes for investors along the way. During his tenure between 1977 and 1990, assets under man- agement increased from $18 million to $14 billion and Mag- ellan was the best-performing mutual fund in the world. His most famous investment principle is, "Invest in what you know," popularising the economic concept of "local knowl- edge". Lynch is also the author of the bestselling investment books One Up on Wall Street (1989) and Beating the Street (1994). Though he continues to work part-time as vice chairman of Fidelity Management & Research Co. Lynch focuses a great deal of time on philanthropy. His Lynch Foundation supports education, religious organi- sations, medicine, and more.

“Investing without research is like playing stud poker and never looking at the cards.”