After correction, the European market has recovered due to the anticipation of a significant intervention by the ECB. Most commodities have continued to decline further over the same period.
We maintain a positive performance over the year, despite a weakness in the last quarter. Our performance in the second half of 2014 is mainly explained by our increasing allocation to commodities (between 10% and 20% of our current portfolios).
We averaged down our exposure to commodities with low cost producers benefiting from a strong balance sheet. We expect positive earnings from our acquisitions, even if the unfavorable environment persists in 2015.
Our core holdings accumulated in recent years are performing well and we continue to take our profits. The contribution of our hedge is marginally positive, thanks to a rebound in volatility.
Our wealth creation goal leads us to acquire assets significantly undervalued by the market. We successfully achieved this in 2009, in 2011 and will continue to guide our partners into expected capital gains soundly covering the risks. As always our patience plays a major role in our ability to accumulate neglected stocks.