HEADLINES [click on headline to view story]:

Family Money

Personal Directions

The Doctor's Consultation by Dr. Iain Corness

Agony Column

Camera Class by Snapshot

Recipes from Rattana

Wine Column

Family Money: Sitting in Judgment - (Part 1)

By Leslie Wright,
Managing director of Westminster Portfolio Services (Thailand) Ltd.

The threeyear global stock market slump has focused attention on the ability of fund managers and other investment professionals to manage money effectively. Central to the debate is how to judge performance.

Most investment funds are measured against a benchmark, usually a stock market index. If a fund beats the benchmark, it gets trumpeted in the fund managers’ advertising, as in: “Fund X outperformed its benchmark in four out of the last five years!” The implication is that benchmarks are there to be beaten, otherwise what a lousy fund it is that you’ve chosen.

But we should be sceptical of claims of benchmarkbeating performance. To flatter investments fund managers have always manipulated variables, from time frames to the actual benchmarks used. Why compare your UK equity fund with the FTSE350 index when the FTSE100 makes it looks better? For instance, Fund X may have outperformed an index in four out of the last five years, but it could equally have underperformed the same index in 6 out of the last 10 years. Fund Y may have beaten its peer group average by 10%, but the group as a whole has lost 30% over the past five years. Given that cash deposits showed a positive return of 20% over the same period, Fund Y can hardly be said to have been a good investment. Relatively better, maybe, but not good. And so on.

If benchmarks can be manipulated, should we instead judge all investments against more solid neutral benchmarks such as cash and government bonds? Perhaps we should go to the opposite extreme and assess all funds and investments against major stock market indices such as the FTSE100, S&P500, and MSCI World? The inability of most fund managers to beat these indices over the long term has brought into question just how effective (or complacent) the retail fund industry has become. Perhaps investors should follow the example of the hedge fund industry, and focus on “absolute returns” – the ability of an investment to make positive returns regardless of wider market conditions? Pinpointing winning funds and getting the timing right is extremely hard!

Fundamental questions

When looking to invest in a fund, among the first questions to ask are which benchmark is being used, and is it an appropriate one? How does it compare to, say, the major stock indices or the return from cash deposits?

Some benchmarks can be terribly confusing. Fund managers usually pick benchmarks that match the investment style of a fund: a broadly diversified large-cap US equity fund is more aptly compared with a similarly broad index like the S&P500, while a smaller-company fund will be matched with a smallcap index. A fund that is looser in its investment style might be measured against a whole-market index – for instance, the US Wilshire 5000, which is based on 6,500 US stocks and loosely replicates the entire US stock market; the S&P500 represents only 75% of market capitalisation.

But even if a suitable benchmark is used, you’d be wise to track wider measures too. Some fund management houses may claim to have come out consistently on top of their peer group, which sounds impressive until you find out that their peer group amounts to just a handful of funds, each of which, including the supposedly stellar one, performed averagely against a wider benchmark. Outperforming a benchmark that itself is underperforming the total market is not much to boast about. For instance, if a large-cap stock fund returned 20% in 1998, that sounds good – but the S&P500 returned 29% that year.

Misleading predictions

Perhaps the fundamental flaw with looking for benchmarkbeating performance is that, on average, it is almost always a mirage in the long run. One fund analysis company looked at how the best performing US equity funds for 1991 performed in subsequent years. Not one of them replicated their strong early performance. The most consistent performer, 10th in 1991, could only manage 993rd 10 years later. Most of the rest fell even further down the performance tables. Consistently, research has shown that a fund’s past performance bears almost no relation to future performance.

(Continued next week)

Personal Directions: Yes we can. No we can’t. Well, maybe we can...

By Christina Dodd,
founder and managing director of Asia Training Associates

“Yes we can, but - wait a second - we need to put it to the committee and let you know once they’ve come up with a decision.”

“When will that be?”

“I’m not sure, perhaps next week. Someone will get in touch with you...”

Heard any of this before? What does it tell you?

Loads of indecision and huge doses of its equally disruptive partner - procrastination - exist in many businesses today, despite the fact that we all realize and acknowledge how difficult it is do business with these negative and counter-productive characteristics at play.

The simple fact of the matter is that many of us find it difficult to be decisive and to make a decision! No matter whether it is a simple decision or a more complicated one. This behavior can literally “drive people up the wall” if they are on the receiving end of it and it is the kind of behavior that can lead many customers to “make a decision” to change to another supplier or another bank or another gas station!

A rare quality indeed is the one where a decision can be well thought out and delivered in a timely fashion with confidence and commitment. An even rarer quality is the one where a decision can be made in a short space of time, to a deadline and under stress, and be a decision that hits the spot and gets the task at hand completed. Phew! Where are these decision makers? They do exist - I have actually met some - and those companies who are fortunate enough to have them on staff have an invaluable resource to say the least!

The all-too-common scenario of not being able to make a decision or of procrastinating until you “drive people to murder”, is nothing new and you might ask, why should we draw point to it? Well, to my mind attention needs to be drawn to it so that we can understand the important part it plays in forming the “mark of a business”, as to how that business operates and whether or not that business achieves. It is the basis of good business that leads to successful business.

On a personal level, it forms the mark of a capable individual, someone who has got it together and is able to cope with all sorts of situations that may arise. By the way, it is okay to go to pieces sometimes, as we are only human, but there are times when having someone around who can cope with making tough decisions in awkward moments is an absolute Godsend.

So many people I know have lost precious time and precious money waiting for decisions to be made. Most of us I’m sure have quite literally agonized over a situation where no decision has been forthcoming and we’ve lost sleep, worried ourselves sick, lost tempers with loved-ones, cancelled other engagements because the decision might come through at the same time and what if you were unable to take the call! We have all been affected by indecision or a lack of decision-making at some time or another and so we all know first-hand the frustration that comes with it.

A few weeks ago I was taking a group of rather senior managers through a workshop and the time came to form groups. Fifty percent of them had no problems with this basic task, but the other fifty percent took much longer in making the decisions of who would go where - and this was despite the fact that certain conditions had been set to make the task simple. As we proceeded, having eventually formed groups, the time came to select a group leader to represent them for the duration of the program. Well, this was a real adventure for some and the looks of exasperation on their faces was quite surprising. It was almost as if they were begging me to choose their leader for them. To decide their leader would involve making another decision!

It is extraordinary how we behave when it comes to making a decision - to being put on the spot and having to come up with something.

What goes on inside our minds when a decision has to be made? How strong and accurate are our powers of being able to analyse a situation and to measure it accordingly to produce the correct response, or an acceptable response? What is the real issue here?

I think a lot of our problems with decision-making lie in the fact that a lot of us are afraid of the acceptance factor. Will the decision be accepted by those whom it will affect? If we know someone is going to be pleased to receive something from us, then we are very happy to go about our way to make sure they get it. We have no fear of rejection. The task is easy and causes no anguish, poses no threat. But if we know that someone is not going to like what we are about to give them, then this opens up a whole different set of emotions which may cause us to hesitate and procrastinate because we are afraid that the outcome will not be accepted.

In the simple activity of forming groups, those participants who found it difficult to decide which group they would be in were probably afraid that their colleagues might not accept or like the choices they were about to make. When it came to selecting a leader, this emotion also raised its head and fuelled the fire of indecision. The acceptance factor is hard for some people to come to terms with and to overcome, and needs to be dealt with on an individual level.

Some people believe that you have either got it or you haven’t when it comes to ability and when it comes to having the ability to make decisions. I believe that there are a great many things that we are capable of learning, a great many abilities that we have but just don’t know how to use. Through coaching and personal and professional development, humans can astonish and amaze each other with their skills - it is all the desire to achieve and perform better, and the method and level of application.

For more information on this and other subjects of personal and professional development, please contact me at [email protected]

Until next time have a wonderful week.

The Doctor's Consultation by Dr. Iain Corness: Cholesterol control - is it really the answer?

by Dr. Iain Corness

Sometimes I find it amazing that there are still folk out there who are not convinced that diet and cholesterol are the key factors in heart disease. However, I should not be too hard on these people, after all, it took the medical world 81 years to accept that fact.

The cholesterol story began in 1913 with a Russian pathologist called Anitschkow and his pet rabbits. (No, I am not making this up!) Way back in the days of button-up boots and before the advent of ballpoint pens and cling wrap, Anitschkow demonstrated that raised cholesterol levels produced hardening of the arteries supplying the heart muscle (the coronary arteries). That really was 1913 and Anitschkow’s work was done on his bunny rabbits, but medical science was not convinced that what happened to Bugs Bunny would actually happen to us. After all, we are not really large rabbits!

However, his work was not in vain, because 47 years later a huge study was done in America (the Framingham Study by a Dr. Kanel) and the initial results were published in 1960. This appeared to show that cholesterol and heart disease were intimately connected. But the medical world is notoriously slow to react to change, I’m afraid, and Kanel’s words fell onto some stony ground. But there were a few believers. (I actually met Dr. Kanel in the early 1970’s and I am glad to say he convinced me.)

The believers continued the research and it was in 1994 that the Scandinavian 4S study proved the concept and the need to lower cholesterol, to in turn reduce heart disease, became universally accepted. That’s 81 years after Anitschkow pointed the scientific finger at cholesterol.

Since the 4S study, the world has been looking at different ways of reducing cholesterol, from diet all the way through to some special drugs called ‘statins’. Now considering that all drugs have a certain ‘risk’ attached to them, for my simple mind, we should at least start with dietary measures. Non-dangerous stuff! I have given you the 10 Dietary Commandments before (from Australian Cardiologist, David Colquhoun). Cut out this article and laminate and stick on the refrigerator!

1. Eat bread every day, preferably multigrain.

2. Eat some fruit every day.

3. Never eat cream or butter again.

4. Eat more fish and eat less meat.

5. Use olive oil every day.

6. Eat some vegetables every day.

7. Eat a handful of nuts every day.

8. Use more fresh herbs and garlic.

9. Have a glass of wine with food every day.

10. Eat in a relaxed way and enjoy your food.

Now all that looks fairly easy and the glass of wine with it all suits me down to the ground, I must say. However, note that that was a glass of wine, not a bottle of wine! It is also a diet that is very easy to follow in Pattaya, where fish and fruit abounds. Just look at Thai food and how it fits in - herbs, garlic, vegetables, little meat, more fish, no dairy products, substitute rice for multigrain and you have a wonderful recipe for a healthy cholesterol reducing diet.

So what’s your cholesterol level? Do you have to do something about it? Until you know your level, you won’t know what your relative risk is. Have it checked!

Agony Column

(Hillary has been away this week, so she has sent in some of her favourite letters from previous columns.)

Dear Hillary,

My doctor has told me I have to give up drinking for my health’s sake. Unfortunately I work in the public entertainment industry, so this is a bit hard. What do you suggest I do?


Dear Ken,

It’s easy. Change your doctor. Always remember that the definition of a true alcoholic is someone who drinks more than their medical advisor.

Dear Hillary,

I am 17 years old and have just arrived from Down Under and I was wondering if you think there would be any jobs in the bar and entertainment industry for someone like me? I have experience in bars and worked for a while in McDonalds after school. I have met a young lady here and I would like to stay here to go with her. Is this going to be easy, or should I look at something else?


Dear Adam,

You certainly have come down in the last shower, haven’t you my petal. That line of work is very hazardous for foreigners in this country, and experience at asking someone if they’d like some fries to go with that is just not good enough, I’m afraid. I’m afraid I think the romance will be a “to go” item. Never mind, you’ll soon be old enough to drink in Oz as well. Better luck next year.

Dear Hillary,

They are doing alterations in my office building, and there is a little man coming in every day with a jackhammer and it sounds as if he is drilling his way through to Singapore. It is going on forever and it is giving me a giant headache. What can I do about this? Who should I complain to? Is this normal in this country?


Dear Headache,

You do have a bunch of questions, don’t you petal. No it is not normal. Most people when going to Singapore just catch a plane. Honestly, though, just talk to whomever ordered the work. Can the alterations be done at night? Can you take a week off work? In the meantime, wear ear muffs and smile a lot. Get a perverse pleasure out of making them think you like it.

Dear Hillary,

I have provided for my wife for the past six years of our marriage. She has never had to want for anything. I am a model husband, good looking, never play up, only drink in moderation, in perfect health, a witty intelligent companion, and considered by everyone as a “good catch”. This week she calmly announced that she wants a divorce. I can’t get it out of her as to why - just that she wants a divorce. Why, Hillary, why?


Dear Confounded,

It’s probably because she has found after six years that she is married to a smug, self-satisfied, arrogant, pompous twit. I think I’d divorce you too, but it wouldn’t have taken me six years.

Dear Hillary,

I am an American who was over your way in December last year. I went out with a girl from a bar. She really seemed to like me and I took her to Phuket and everywhere around Thailand for the month I was on holiday. I helped her out with some money to get some surgery done before I come back this year (she wanted to have her nose re-modelled). Since then I have been writing to her, but she has never replied. Do you think she has got my letters, or what? Could you see if she did? Her name is Noy.


Dear Bob,

Sorry, but I think you’ve been led up the garden path by the carrot. Hillary gives advice to the lovelorn, she is not a Missing Persons Bureau or the Pattaya branch of the Pinkerton’s. I think your Noy will have moved on by now. Sorry, but there’s a lot of Noy’s out there.

Dear Hillary,

I suppose you must get letters like mine all the time, but you are the only person I think I can turn to in this situation. I came to Thailand last year for a holiday and met a wonderful girl. I had never met anyone like her before. (The girls here in the UK just ignore me because I am only 5 foot 5 inches tall, but in Thailand I fit in wonderfully!) I am coming out again this year, but when I wrote to my girlfriend and told her to expect me at Xmas she wrote back and said it was not really suitable and she could be away up country. Hillary, am I getting the cold shoulder? What do you think?


Dear Jason,

This may come as a shock, Jason my petal, but unattached Thai girls can have more than one boyfriend. Whilst you may be pining for your Lek, Noi or Toy, she may be pining for her Jack, Jacques, and Jorgen as well as her Jason. You have to remember you are here for four weeks. She is here for 52! Relationships over here are a bit like Snakes and Ladders - you just went back several places!

Camera Class: It’s in the bag! Or even the case!

by Snapshot

If you are a true photography enthusiast, you will have a little more than just a point and shoot compact camera. You will have an SLR (or two), some lenses, some filters, a flashgun and even a tripod.

So what should you really aim to have? And why? The following is a list of what Harry Flashman carries, which should be a reasonable guide. My equipment has been enough for me to photograph professionally in many countries, so should be considered adequate for a ‘serious’ amateur.

Firstly, you do need a good camera - a 35 mm SLR (single lens reflex) at least. The first pointer is to select a good brand. There are many to choose from, but if you look at the pros who are out shooting oodles of feet of film every day you will find the same names on the camera cases. I make no secret of the fact that I use Nikon - bulletproof and quality lenses. Others such as Canon, Pentax, Olympus, etc., are also excellent brands, all of which have interchangeable lenses too, so your basic system can be enlarged upon over a period of time, and your original lenses will still be good.

The SLR is the centre of your equipment. It is this camera that will allow you to be creative in your shots. It is this camera that will win you awards and recognition. It will be expensive, so choose wisely. For my money, the ideal “starter” SLR would be a Nikon FM2n. A mechanical camera that allows you to make all the decisions. Yes, I do have one. No, it is not for sale. Despite the digital advances, you will learn about photography by using a manual camera.

Now you look at lenses. The “standard” lens that will come with your SLR will most likely be a 50 mm. Buy firstly a wide-angle lens. Around 28 or 24 mm is good, or even 20 mm for very dramatic shots, but the distortion problem can be a little much at this wide angle. The next lens you should buy is around the focal length of 135 mm - the ideal lens for portraits.

Remember that you are wanting to produce sharp photographs. The camera is only as good as the piece of glass the light comes through. This is why I use “prime” lenses which are optically perfect - no zooms. Zoom lenses also make for lazy photographers. Instead of walking in to compose the subject, the photographer zooms in. The depth of field is lost, the flash is too far away and the chance of a perfect shot is lost.

What else? A good quality flash, ‘dedicated’ to your SLR is the best, and another reason why I use all the same brand equipment, or top of the line gear that adapts to my camera system. (My flash is an old Metz 45 CT1, which is still perfect today - despite the scratches.)

Other equipment includes filters, and I will publish a separate article on this subject - but do use adaptor rings to bring all the filters to the same size. With my system, all lenses are brought up to 62 mm at the outside. Again a cost saving as you do not need one polarizer for the standard lens and another for the telephoto.

Another important item is a good quality tripod. An often ignored reason for having and using one is that it slows down your photography and makes you think about composition and just what it is that you are trying to capture. Not just a grab and gone to the next shot situation. I will write about tripods in the future too.

What else do I carry? Spare film, colour and B&W. “Gaffer” tape, a piece of flash cable around 5 metres long and a mini-tripod that can sit on tables or other surfaces. Very handy at night. Oh yes, almost forgot - a shower cap (the kind you get in hotels) to cover the camera if I am caught in the rain!

Recipes from Rattana: Fish- UK style

If there is a national dish for the UK, then Fish and Chips has to be a prime contender. However, there are some little UK trade secrets in cooking the humble fish, and this week I reveal them. The principal one is beer! This is used in a beer batter, and clever cooks will naturally drink the leftovers while cooking the chips!

Ingredients Serves 4

Potatoes 700 gms

Fish fillets (firm white) 1 kg

Vegetable oil for frying 2 litres

Lemon wedges

Malt vinegar (for serving)

Tartar Sauce

Batter Ingredients

All-purpose flour 1 cup

Salt 1/2 tspn

Pepper 1/4 tspn

Eggs, separated 2

Beer (lager or pilsner) 1 cup

Cooking Method

In a large bowl, mix the flour, salt and pepper. Add the egg yolks and beer and stir to combine. Beat the egg whites to moderately stiff peaks and fold into the batter.

Trim the fish fillets to uniform size. Dip the fish into the batter, coating them well and allowing the excess to drain off.

Heat about 5 cms of oil to 375ฐF in a deep-fryer. Now add 1-2 pieces of fish to the hot oil and fry until crisp and golden brown usually around 5-7 minutes, gently turning the pieces once or twice as they cook.

Drain on paper towels and fry the remaining fish in the same way. Arrange the fish on individual plates, each with lemon wedges and malt vinegar and tartar sauce as condiments.

Wine Column: Katnook: Cream of Coonawarra’s Crop

By Ranjith Chandrasiri

Few other areas in Australia can rival the complexity and richness of Coonawarra’s soil and climate. Four and a half hours drive from either Adelaide or Melbourne, this “odd” piece of land - widely known as the cigar-shaped Terra Rossa, owns a completely level soil which is distinctively red in colour and crumbly to touch. Forty-five centimetres under the crimson soil rests a bed of pure limestone with a constant table of pure water flowing just 1.5 metres beneath it.

Strict quality control: senior and chief Katnook Winemakers Wayne Stehbens (right) and Tony Milanowski assessing recently fermented juice.

Fruit of passionate labour: the Jimmy Watson Trophy, Australia’s most coveted award for wine was awarded to the Katnook Estate in 1998 for their Prodigy Shiraz 1997.

A lush climate comparable to the Mediterranean makes for long but cool hours of sunshine during the ripening period which allows grapes to develop intense flavours while retaining good acid levels. Coonawarra’s overall climate; lengthy warm summers, cool autumns, and cold winters is often compared to that of Bordeaux’s.

These idyllic growing conditions have been utilized mainly for fruit growing as early as the 1860s. In fact, no other land could better suit this purpose. The Scottish entrepreneur John Riddoch was fully aware of this when he began buying land at Katnook - aboriginal for “fat land” - after purchasing other properties nearby. In 1890, Riddoch formed the Coonawarra Fruit Colony, established administration headquarters in Katnook, and sold off the land in ten-acre blocks.

Riddoch planted 140 acres of his own vines. His first vintage in 1895 was a low key event in a nearby nursery shed. His second, with a much greater volume of fruit and attended by established winemaker William Salter was made in his woolshed at Katnook a year after. By the 1900s, the area was already producing large quantities of an unfamiliar kind of wine which was largely Shiraz, low in alcohol but brisk and fruity.

In 1967, the Yunghanns family purchased the Katnook and in 1969 planted their first vines. The family renamed the property Katnook Estate and formed the Coonawarra Machinery Company, known today as the Wingara Wine Group. In 1980 production of wine under both the Riddoch and Katnook Estate labels commenced in the Katnook woolshed just as John Riddoch did 84 years earlier.

Katnook Estate’s limited released wines today are widely known for their great intensity of flavour, made with fastidious attention to detail. Grown in the enviable Terra Rossa area, the wines possess concentrated flavours, fine balance and integrity of regional varietal character - hallmarks of the estate’s range of Chardonnay Brut, Riesling, Chardonnay, Sauvignon Blanc, Merlot, Cabernet Sauvignon, and Shiraz. Katnook Estate wines’ excellence and superlative quality have not gone unnoticed.

“Few Australian cabernets better Katnook for purity of varietal character, style and potential longevity,” said wine expert Ralph Kyte Powell. More so, Katnook’s 1999 Cabernet Sauvignon vintage was praised as “Possibly the finest non-flagship cabernet in the country” by the Australian Gourmet Traveller wine panel June/July 2002. This same vintage was awarded “Blue-Gold Medal” and considered among the “Top 100 Wines” at last year’s Sydney International Wine Show, and awarded “Silver Medal” at the London Wine Challenge 2002.

Previous vintages of Katnook’s Cabernet Sauvignon were equally successful. The 1998 and 1997 were awarded “Silver Medal”, International Wine Challenge 2000 and “Gold Medal” and “Jimmy Watson Trophy” 1998 runner up respectively.

Another favourite is the Katnook Estate Chardonnay with a 1999 vintage that earned a five-star rating in the Decanter UK in June, 2002 for being “... intensely complex and layered ...” This vintage was likewise awarded “Blue-Gold Medal” at the Sydney International Wine Show 2001. The 1997 vintage was highly regarded as well.

Ranjith Chandrasiri is the resident manager of Royal Cliff Grand and founder of the Royal Cliff Wine Club, Royal Cliff Beach Resort, Pattaya, Thailand. Email: [email protected] or [email protected] Website: http://www.royal