Solar power stocks shine

Oppenheim Investment Managers had another stellar month and Irish Life made a comeback, writes Caroline Madden

OPPENHEIM INVESTMENT Managers continued to dazzle in the Rehab Great Investment Race in March, delivering yet another stellar performance despite the inclement trading conditions.

In a month when the Irish market sank by 3.71 per cent, Oppenheim maintained its strong upward trajectory, growing its race fund by 17.6 per cent. This brings its total return since the race got under way last summer to a remarkable 177.3 per cent, with the result that its original €100,000 investment now stands at an extremely healthy €277,342.

With a gap of over €178,000 between Oppenheim and its nearest rival, overall victory looks increasingly likely for the current leader.

The secret to Oppenheim's success remained broadly the same as last month - astute stock-picking by fund manager Stephen Hynes, who continued to favour the green energy sector, including solar energy companies Renosola and Evergreen Solar.

However, Hynes deviated slightly from his previous strategy by dipping into commodities, accessing the gold and silver markets through exchange-traded funds. But he offloaded these before the end of the month, and held over just four stocks into April - Xsunx, Evergreen, LDK Solar and Renesola.

Irish Life Investment Managers succeeded in reversing its fortunes last month, recovering from a weak performance in February to produce an impressive return of 7.8 per cent. This brought its race pot up to €99,136, just under its original level, and moved Irish Life to second place.

Fund manager Séamus Magner's active trading style paid off, and he netted gains by taking short-term positions on Fannie Mae and Hypo Real Estate. Interestingly, Magner's most significant gain was generated by a gamble on Anglo Irish Bank the day after St Patrick's Day, when the company suffered heavy losses.

Magner had pared back his portfolio to just two shares by the end of the month - Iona, which performed well for him last month, and Expro International. Interestingly, the two contestants to make money last month were also the only two to trade their portfolio actively.

After rebounding somewhat in February, KBC Asset Management succumbed to difficult trading conditions last month, shedding 5.8 per cent from its race fund. Fund manager Noel O'Halloran now has just €92,133 out of the original €100,000 left at his disposal.

Once again O'Halloran resisted the temptation to adjust his portfolio even slightly, continuing to hold just five stocks - CRH, Smartrac, Acciona, Tele Norte Leste Participcoes and Cia de Saneamento Basico.

AIB Investment Managers emerged as the worst performer of the month, losing 11.3 per cent from the value of its race fund, which now stands at a much diminished €73,516. This brings the total loss sustained so far to 26.5 per cent.

Despite his dwindling race fund, manager Keith Johnstone kept his nerve and stuck with his buy-and-hold strategy. He continued to hold just four stocks in his portfolio - Nintendo, National Oilwell, Flir Systems and footwear company Crocs.

"The main reason for the decline in the fund in March was a 31 per cent decline in Crocs and a 10 per cent decline in National Oilwell," commented Johnstone. "Nintendo was down 3 per cent and Flir Systems was up 1 per cent. Crocs suffered as investors in the US sold retail stocks on concerns over falling consumer confidence."

Languishing at the bottom of the league table once again was Bank of Ireland Asset Management (BIAM) which, having lost 30 per cent of its fund to date, will have to produce a spectacular turnaround to catch up with the rest of the field.

In March alone, its fund fell by a further 6.1 per cent to €69,952. Despite the severe losses incurred so far, fund manager Pat Cunningham once again resisted making any change to his compact portfolio. He continued to hold just four stocks - infrastructure group MacQuarie; Sonic Healthcare, an Australian medical diagnostics company; Hong Kong property developer Sun Hung Kai; and French services company Vallourec.

Fortunately the losses sustained so far by four of the contestants have been more than compensated for by Oppenheim, and so the overall profit raised so far now stands at €112,079. Any profits made from the Rehab Race will be used to help autistic children and their families in Ireland.