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MARCH 2012 PERFORMANCE REVIEW

The net asset value of the Emerging Resources Company Share Fund fell by 5.10% in March. Between the inception of the Fund and the end of March, the value of the Fund increased at an annualised rate of 7.28%.

General equity market conditions continued to improve in March but background market conditions specific to the resources sector deteriorated.

· The S&P 500 index of U.S. equity prices rose 3.1% and the S&P/ASX 300 stock price index increased 0.8%. The resources component of the Australian market indicator fell by 4.3%.

· Prices of all the main daily traded nonferrous metals fell between 1.4% (for copper) and 12.5% (for nickel).
· Prices of silver (-6.2%), gold (-3.8%) and platinum (-2.9%) declined.

· Crude oil prices (WTI) dropped 3.7%.
Of the 19 stocks in the portfolio, the prices of nine increased and the prices of 10 declined. The Manager sold one stock – Tap Oil. Net sales of securities were equivalent to 1.9% of the opening value of the Fund. At the end of the month, cash holdings were equivalent to 18.5% of the Fund’s assets.

During the March quarter, the Fund exited two stocks and reduced positions in Sundance Resources, Red 5 and Horizon Oil after each had made relatively strong share price
gains, leaving the Fund with still significant positions in each of the latter three companies. The Manager has completed its analysis of several new potential investment
opportunities for which the available funds can be used.

These include a new listing in which the Fund has been offered an opportunity to participate subject to hareholder approval and a global capital raising to be completed in mid April.

The background to the sale of Tap Oil was referred to in the February monthly report for the Fund. Tap Oil reduced its relative investment attractiveness by selling assets
producing current income leaving its valuation more reliant on future exploration success. In positioning the portfolio, the Manager is targeting nearer term production, as in the case of its recent purchase of Black Mountain Resources, to ensure a continuing flow of new projects for investors in the Fund and less risky valuation upside.

Welcome signs of a breakdown in the correlation between stock price movements and macroeconomic conditions have permitted company specific events to play a larger role
in share price movements so far in 2012.

Kasbah Resources made the largest positive contribution to Fund performance with lesser contributions from Pluton Resources and Black Mountain Resources.

· Kasbah Resources reported a 150% increase in its Moroccan tin resource as well
as financing and offtake agreements involving Toyota Tsusho.

· Pluton Resources was approaching the deadline for financing its Irvine Island iron ore project.

· Black Mountain Resources confirmed it is likely to commence silver production in 2012 at two sites rather than one.

Aguia Resources subtracted most from the investment performance with lesser losses
coming from Mirabela Nickel and Overland Resources.

· Aguia Resources reported disappointing drilling results from its Atlantic potash project in Brazil.

· Mirabela Nickel faced falling nickel prices after failing to meet its cost targets.

· Overland Resources announced a resource upgrade but missed its previously foreshadowed target date for submitting a mining plan to the relevant Yukon
government authorities. It also abandoned an option to invest in a copper project in British Columbia.
Other companies in the portfolio announced significant development milestones.

· Carrick Gold announced the acquisition of additional gold resources near its existing development site in the Kalgoorlie area.

· Woodside Petroleum announced that its Pluto LNG project had reached start-up.

· Nucoal Resources announced that it had expanded its footprint in the Hunter Valley through the acquisition of an advanced exploration project which would have synergies with its proposed Doyles Creek mine.

Of the five commodity segments into which the Fund is divided, only the steelmaking minerals and coal companies made a positive return (+4.3%). The other segments - oil
and gas (-1.4%), nonferrous metals (-10.1%), industrial minerals (-12.5%) and gold (- 17.0%) - subtracted from the investment outcome

Largest Holdings

Kasbah Resources

Moroccan tin mine developer
Horizon Oil PNG & Chinese oil and gas developer

Pluton Resources
WA iron ore mine developer

Coeur d'Alene Mines
International silver producer

Orocobre
Argentine lithium deposit developer

% of total assets 32.0%
Total portfolio holdings 18

Fund at a Glance
Additions Deletions
Tap Oil

http://www.eimcapital.com.au/monthly%20reports/2012-03_ERCSF.pdf

There you go an impartail post from me !

Happy Easter

Hoot