Petri Redelinghuys, founder of Herenya Capital Advisors, provides analysis of Harmony Gold, Anglo-Gold Ashanti, Raubex, and Naspers.

Harmony (HAR) & Anglogold (ANG)

We are looking at taking a relatively medium-term position trade where we long on Harmony Gold (HAR) and short on Anglogold Ashanti (ANG), and essentially, this is not a play on the price of gold or anything of the sort. This is rather a look at the ratio of correlation between Harmony and Anglo, and how that has shifted apart over time. We are taking a trade based on the assumption that the correlation will return to normal. We are taking this trade with equal exposure on both sides since there is a close relationship between these two. At the beginning of the year, these two instruments were very much in line, and now they have drifted apart. Our idea is that these two will come back together again at some point, as they have done in the past.

Raubex (RBX)

Is a construction business that is supported by Sanral-related work, and recently the Australian segment has weighed on earnings. We are looking at a market that is already skittish and has just received some less-than-pleasing news, resulting in the extraordinary move you see in the chart. In the last two weeks, we have seen a consistent downward movement of about near 20% in total. We think this is a little exaggerated, and from other technical points, we see this as a good opportunity for a long trade. We see the possibility for this chart to go back to R52 if not higher, so now would be a good time to enter with a stop loss set at R46.50. Before recent world events, we saw a strong upward momentum, and we believe that with markets stabilising, we will most likely see that trend start once again.

Naspers (NPN)

South Africa has recently been more interested in Chinese technology than its American counterparts, and we have noticed this. We recently bought into KWEB, which is the Chinese Tech ETF, and another way to get exposure to eastern tech is through Naspers (NPN) and Prosus (PRX). Tencent (700) recently came out with an announcement for an AI assistant, which was received well by the market. The performance of Tencent has a direct influence on the performance of Napers and Prosus through the holdings each company has. Naspers is a strong company, and it has been under undue pressure for some time. We have already seen a change of momentum recently, and it is on track to meet the 200 Day moving average. We see this as a low-risk trade. Another thing to consider is that as the Middle East conflict continues, we see more people move away from US-based tech, which is facing uncertainty and moving towards more stable competitors, the biggest being China, so this all bodes well for Naspers.

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