The Elstree Enhanced Income Fund returned a negative performance for November 2008 of -13.46%, bringing their 12 month performance to -33.59%.
The manager noted that the ASX All Ordinaries accumulation index was down one point during the month as much a 16%, and the hybrid market in which they invest followed the equity market lower. However due to the lag with which hybrid securities frequently exhibit, they did not participate in the equity market rally over the last few days of the month.
Looking forward the manager is expecting the banks to commence issuing equity to replenish damage caused by credit losses. Noting that the banks have yet to raise equity, the manager is expecting them to do so, reminding investors that during the 1990's the major banks lost around 16% of shareholders equity and around 1% of assets, while dividends fell by around 45%.
