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How to transition your portfolio after the SCF collapse

August 31, 2010

The failure of South Canterbury Finance will have very clear investment implications:

1.) Government bond yields will rise.

2.) Current high yielding NZ Debt Securities will decrease in yield as the $1.7bn worth of SCF funds are redeployed in a matter of weeks.

3.) The NZ Share Market will remain weak.

Logic Fund Management has been recommending and currently recommends the following NZ fixed income bonds:

NZ Fixed Income YTM/Reset Maturity Date Reset Date
ANBHA 8% Perpetual April 2013 & 2018
BISHA 8.6% Perpetual March 2013 & 2018
CASHA 16% Perpetual December 2012
WKS 010 15% 2 yrs NA

We recommend taking advantage of this situation immediately because the opportunity to lock in high yielding, secure fixed interest within New Zealand is evaporating daily.

Please contact Logic Fund Management if you would like any more information or would like assistance taking part in this opportunity.  Disclosure statements are available upon request.

Sincerely,

Greg Marshall

Disclaimer:

The information and any opinions herein are based upon sources believed reliable, but Logic Fund Management and its directors make no representations as to its accuracy or completeness.  All opinions reflect our judgment on the date of this report and are subject to change without notice.  The information contained in this publication should not be used as a basis for making an investment decision about any particular company. Professional investment advice should be taken before making an investment.  Past performance is not a reliable guide to future performance.

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