U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare...
Transcript of U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare...
![Page 1: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/1.jpg)
Enduring the Global Financial Crisis
www.usfunds.com
U.S. Global InvestorsSearching for Opportunities, Managing Risk
Frank E. HolmesCEO and Chief
Investment Officer
John Derrick, CFADirector of Research
Brian Hicks, CFAPortfolio Manager
October 16, 200808-723
Evan Smith, CFAPortfolio Manager
Romeo Dator, CFAPortfolio Manager
Jack DzierwaGlobal Strategist
![Page 2: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/2.jpg)
2www.usfunds.com
Fund Recognition
Winner of 26 Lipper Fund Awards and certificates since 2000
Investment
leadership results
in performance
![Page 3: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/3.jpg)
3www.usfunds.com
*SWOT analysis (Strength, Weakness, Opportunity, Threat). Alpha is a measure of the difference between a fund’s
actual returns and its expected performance, given its level of risk as measured by beta.
Multidisciplinary Focus
![Page 4: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/4.jpg)
4www.usfunds.com
Our Strategy for Enduring a Credit Crisis
Goal: Stabilize volatility of funds
Reasons: Massive headwinds from billions of dollars of
hedge fund redemptions
Government response has not generated
confidence in the plan
Credit contraction has gone global
Tactics: Raise cash levels, utilize covered writing until
our proprietary macro indicators turn positive
![Page 5: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/5.jpg)
5www.usfunds.com
What is a Financial Crisis?
• Financial crisis can be divided into:• Banking crisis• Currency crisis• Twin crisis
![Page 6: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/6.jpg)
6www.usfunds.com
Crisis Frequency
Source: CLSA
![Page 7: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/7.jpg)
7www.usfunds.com
1. Wholesale price
2. Retail price
3. Fairytale price
Three Price Levels When
Valuing Derivatives
![Page 8: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/8.jpg)
8www.usfunds.com
Derivatives-Weapons of Mass
Destruction (WMDs)-Proliferate
5 Times Bigger In Five YearsTrillions
Source: U.S. Global Research
Warren Buffett 2002
![Page 9: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/9.jpg)
9www.usfunds.com
Derivatives-Weapons of Mass
Destruction (WMDs)-Proliferate
Trillions
Source: Bank for International Settlements
![Page 10: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/10.jpg)
10www.usfunds.com
As Seen on TV
![Page 11: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/11.jpg)
11www.usfunds.com
Balanced Thought Process
![Page 12: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/12.jpg)
12www.usfunds.com
Government Policy Model —
Precursor for Change
![Page 13: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/13.jpg)
13www.usfunds.com
U.S. Broad Money Growth
Source: CLSA
![Page 14: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/14.jpg)
14www.usfunds.com
M3 vs Crude Oil
Government will continue to printmoney, like the recent bailout ofFannie Mae and Freddie Mac, tosupport the economy
![Page 15: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/15.jpg)
15www.usfunds.com
No Triangle, No Conflict
![Page 16: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/16.jpg)
16www.usfunds.com
Blame Game
![Page 17: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/17.jpg)
17www.usfunds.com
Blame Game — Who Pays?
![Page 18: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/18.jpg)
18www.usfunds.com
80:20 Rule — Did You Know?
![Page 19: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/19.jpg)
19www.usfunds.com
Convergence and Unexpected Consequences
![Page 20: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/20.jpg)
20www.usfunds.com
Picking Bottoms is Challenging
Source: UBS estimates
![Page 21: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/21.jpg)
21www.usfunds.com
S&P 500 2002-2004 — U Bottom
Source:Merrill Lynch Market Analysis, Bloomberg
![Page 22: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/22.jpg)
22www.usfunds.com
S&P 500 1990-1992 — U Bottom
Source:Merrill Lynch Market Analysis, Bloomberg
![Page 23: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/23.jpg)
23www.usfunds.com
S&P 500 1987-1989 — U Bottom
Source:Merrill Lynch Market Analysis, Bloomberg
![Page 24: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/24.jpg)
24www.usfunds.com
S&P 500 5 Day Rate of Change
Source: Bloomberg
![Page 25: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/25.jpg)
25www.usfunds.com
S&P 500 52 Week Rolling Return
Source: Bloomberg
![Page 26: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/26.jpg)
26www.usfunds.com
S&P 500 Rolling 8 Year Weekly
Source: Bloomberg
![Page 27: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/27.jpg)
27www.usfunds.com
Recent Energy Downcycles
Source: Tudor Pickering, Holt & Co., Bloomberg
![Page 28: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/28.jpg)
28www.usfunds.com
Baltic Dry Index
Source: Bloomberg
![Page 29: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/29.jpg)
29www.usfunds.com
Cash Flow Multiples
The source of this graph is Tudor Pickering, Holt & Co. The securities identified in the graph
were selected for inclusion by Tudor Pickering, Holt & Co. and may or may not be held by
portfolios managed by U.S. Global Investors, Inc., whose holdings may change daily.
![Page 30: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/30.jpg)
30www.usfunds.com
S&P 500 Energy Index vs
Its Forward P/E Ratio
Source: Bloomberg
![Page 31: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/31.jpg)
31www.usfunds.com
Copper Approaching Marginal Cost
Source: Credit Suisse, Barclays Capital and Bloomberg
![Page 32: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/32.jpg)
32www.usfunds.com
Copper Approaching Marginal Cost
Source: Brook Hunt, Merrill Lynch Research
![Page 33: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/33.jpg)
33www.usfunds.com
China’s Oil Demand
Source: UBS estimates
![Page 34: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/34.jpg)
34www.usfunds.com
China’s Oil Demand
Source: China National Bureau of Statistics, Reuters, China Customs, UBS
![Page 35: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/35.jpg)
35www.usfunds.com
Oil Consumption
Source: BP, BCA Research
![Page 36: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/36.jpg)
36www.usfunds.com
Developing Nations’ Per Capita Income is at a
Level Where Oil Demand Begins to Grow Rapidly
Source: PIRA
![Page 37: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/37.jpg)
37www.usfunds.com
Mexico’s Oil Production Decline
Source: UBS, Pemex
![Page 38: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/38.jpg)
38www.usfunds.com
Russia’s Oil Output Slide
Source: UBS, Reuters
![Page 39: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/39.jpg)
39www.usfunds.com
Mismatch Between Oil Reserves and Economic
Systems (Proven Reserves vs. Level of Access)
Source: PIRA
![Page 40: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/40.jpg)
40www.usfunds.com
MSCI ex Japan 10-year Oscillator
Source: Bloomberg
![Page 41: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/41.jpg)
41www.usfunds.com
Performance of Hong Kong
Source: Datastream, CLSA Asia-Pacific Markets
![Page 42: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/42.jpg)
42www.usfunds.com
CPI Trending the Right Way
Source: CEIC Data, CLSA Asia-Pacific Markets
![Page 43: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/43.jpg)
43www.usfunds.com
Positive Policy Moves
Source: People’s Bank of China, CLSA Asia-Pacific Markets
![Page 44: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/44.jpg)
44www.usfunds.com
Compare Financial Strength 1997 to 2008
Current account balance (US$bn)
Source: CLSA Asia-Pacific Markets
![Page 45: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/45.jpg)
45www.usfunds.com
Infrastructure: Has something changed?
• Infrastructure related stocks havenot escaped the rout of themarkets this year
• Postponement and cancellationof some projects due toregulatory impediments
• Expectation of a global slow-down in infrastructure spendingdue to tighter credit conditions
• Lower commodities pricesdo not bode well forinfrastructure creation
![Page 46: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/46.jpg)
46www.usfunds.com
Delay vs Destruction of Construction
• Infrastructure assets are reaching theiruseful life
• Governments, including both U.S.presidential candidates, remaincommitted to infrastructure spending
• Recent renewal of tax credits for solarand wind in the USA should supportthe theme
• Sale of Midway Airport in Chicagolast month (at a high multiple of ~35x07 EBITDA) illustrates an attraction ofquality infrastructure assets
Chicago Midway Airport
![Page 47: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/47.jpg)
47www.usfunds.com
So how to play it now …
• We continue to believe in a diversifiedportfolio of infrastructure assets.
• In light of the current market conditionswe may be more focused on the U.S.
• Concentrate on steady cashflows andhigh dividend yields of traditional assetssuch as power utilities, selected airportsand toll-roads.
• Valuations in the construction &engineering space have fallensubstantially – one year forward P/E ofaround 12 vs. 25 at the end of 2007.
We search selectively for opportunities.
![Page 48: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/48.jpg)
48www.usfunds.com
We are aware of the risks
• Will emerging markets, including China,continue to grow/support commoditiesin light of a slowdown in the West? Yes.
• Although recent data from Chinaillustrates that the economy is slowing, astimulus package is already underway
• Will investors have access to sufficientcapital in light of tighter creditconditions? Uncertain outcome.
• Watch backlogs of construction &engineering companies for signs of ameaningful slowdown in demand – nextsix months will be critical
![Page 49: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/49.jpg)
49www.usfunds.com
6 Billion People-Tipping Point
![Page 50: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/50.jpg)
50www.usfunds.com
• EMEs hold 70% of global foreign-exchange reserves
• Less prone to contagious crises than before
• Unlike the U.S. and other developed nations, EMs are net creditors,
with improving debt ratings and foreign currency reserves
• 40% of EM debt now rated investment grade vs 3% a decade ago
Long Term Bullish is a Sustainable Paradigm
Source: Merrill Lynch
![Page 51: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/51.jpg)
51www.usfunds.com
Long Term Bullish Drivers for
Commodities in Infrastructure Spending
Source: Morgan Stanley Research, World Bank, Global Insight e=Morgan Stanley Research estimates
![Page 52: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/52.jpg)
52www.usfunds.com
Disclosure
Please consider carefully the fund’s investment objectives, risks, charges and expenses.
For this and other important information, obtain a fund prospectus by visiting
www.usfunds.com or by calling 1-800-US-FUNDS (1-800-873-8637). Read it carefully
before investing. Distributed by U.S. Global Brokerage, Inc.
Foreign and emerging market investing involves special risks such as currency fluctuation and less public
disclosure, as well as economic and political risk. By investing in a specific geographic region, a regional fund’s
returns and share price may be more volatile than those of a less concentrated portfolio. Because the Global
Resources Fund concentrates its investments in a specific industry, the fund may be subject to greater risks and
fluctuations than a portfolio representing a broader range of industries. All opinions expressed and data
provided are subject to change without notice. Some of these opinions may not be appropriate to every investor.
The S&P 500 Stock Index is a widely recognized capitalization-weighted index of 500 common stock prices in
U.S. companies. The S&P 500 Energy Index is a capitalization-weighted index that tracks the companies in the
energy sector as a subset of the S&P 500. The Baltic Dry Freight Index is an economic indicator that portrays an
assessed price of moving major raw materials by sea as compiled by the London-based Baltic Exchange. The
Hang Seng Composite Index is a market capitalization-weighted index that comprises the top 200 companies
listed on Stock Exchange of Hong Kong, based on average market cap for the 12 months. The Hang Seng China
Enterprises Index is a capitalization-weighted index comprised of state-owned Chinese companies (H-Shares)
listed on the Hong Kong Stock Exchange and included in HSMLCI index (Hang Seng Mainland Composite
Index). The following securities mentioned in the presentation were held by one or more of U.S. Global
Investors Funds as of 9/30/08: Freeport McMoRan. 08-722
![Page 53: U.S. Global Investors · · 2014-05-14in performance. 3 *SWOT analysis (Strength, ... Compare Financial Strength 1997 to 2008 Current account balance ... The excess return of the](https://reader034.fdocuments.in/reader034/viewer/2022051802/5aea012c7f8b9a6d4f917dc3/html5/thumbnails/53.jpg)
53www.usfunds.com
Disclosure
Alpha is a measure of performance on a risk-adjusted basis. Alpha takes the volatility (price risk) of a mutual
fund and compares its risk-adjusted performance to a benchmark index. The excess return of the fund relative to
the return of the benchmark index is a fund's alpha. The MSCI Asia ex-Japan Index is a free float-adjusted,
capitalization-weighted index measuring the performance of all stock markets of China, Hong Kong, Indonesia,
Korea, Malaysia, Philippines, Singapore, Taiwan and Thailand, India and Pakistan. The Nasdaq Composite
Index is a capitalization-weighted index of all Nasdaq National Market and SmallCap stocks. Red chips are
Chinese companies that trade in Hong Kong and are incorporated in Hong Kong. The Russian Trading Systems
Index is a capitalization-weighted index that is calculated in USD. The index is comprised of stocks traded on
the Russian Trading System. The following securities mentioned in the presentation were held by one or more
of U.S. Global Investors family of funds as of 9/30/08: Agnico-Eagle (Gold and Precious Metals Fund 3.71%,
World Precious Minerals Fund 2.94%); Hyflux (Global MegaTrends Fund 1.83%); Randgold Resources (Gold
and Precious Metals Fund 4.84%, World Precious Minerals Fund 7.83%); Yamana (Gold and Precious Metals
Fund 4.05%, World Precious Metals Fund 3.90%, Global Resources Fund 0.84%, Holmes Growth Fund
0.02%); Mechel (Eastern European Fund 1.99%); Royal Gold (Gold and Precious Metals Fund 4.26%, World
Precious Minerals Fund 1.66%); Kinross (Gold and Precious Metals Fund 5.47%, World Precious Minerals
Fund 0.68%); Goldcorp (Gold and Precious Metals Fund 6.20%, World Precious Minerals Fund 9.16%, Global
Resources Fund 1.79%); Newmont Mining (Gold and Precious Metals 3.77%, World Precious Minerals Fund
1.35%); Aurelian Resources (World Precious Minerals Fund 2.67%); Peabody Energy (Global Resources Fund
1.72%); Freeport-McMoRan (Gold and Precious Metals Fund 1.07%, World Precious Minerals Fund 0.90%,
Global Resources Fund 1.02%, Holmes Growth Fund 0.95%, Global MegaTrends Fund 0.93%); ExxonMobil
0.00%; British Petroleum 0.00%; HSBC 0.00%; Mitsubishi 0.00%. 08-723