In 2014, S&P 500, Hang Seng Index and HS300 rose 11.4%, 1.3% and 51.7% respectively. Asynchronized global economic recovery and "The Fourth Industrial Revolution (All-Intelligent, Low-Carbon)”defined by Midas Research in 2013 are on-going. The market expects Fed to enter the interest-rate hiking cycle as early as June 2015 while China entered interest-rate down-cycle already in 4Q14. China's economy is slowing down but expected to land softly on a "new norm". Midas International Group (MIG)'s brother private fund house in mainland, i.e. Midas Investments China (MIC) achieved 116.7% growth in itsequity fund and ranked 2nd among Chinese PE Fund houses in the same category.
MIG's equity fund achieved 12.9% growth in 0.58 year and beat S&P500 by 7.7ppts by April 10th 2015. NAV of MIG increased 19.9% including income from advisory services. Our HK holdings outperformed and overall short-term growth was in-line with management's expectations. MIG's management also invested millions into US startup Luvo Inc. in March 2014. Luvo successfully attracted Goldman Sachs' affiliate company, Broad Street Principal Investments to become its strategic investor and invest US$ 45mn in 1Q15.
Mainland China has been issuing new relaxations on cross-border investment restrictions to Hong Kong since 2014. The "Barbarians" from the north are increasingly flooding through the "gate", and they are not likely to stop.