NAV on 2019/09/16
|NAV on 2019/09/13
|52 week high on 2019/06/21
|52 week low on 2019/01/02
|Total Expense Ratio on 2019/06/30
|Total Expense Ratio (performance fee) on 2019/06/30
Sanlam Collective Investments
South African--Multi Asset--Low Equity
ASISA South-African Multi-Asset Low Equity category
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GraySwan SCI* Cautious Fund of Funds - Jun 19
During May there was weakness in risk assets brought on by the US-China trade dispute, but due to the strong performance in June we finished the quarter positively and continued the good run for the year so far. The US Federal Reserve held rates steady in June at a target range of 2.25-2.5%. Fed Chair Jerome Powell indicated that the case for accommodative policy increased as the global economy slowed. Traders are pricing in a 100% chance of at least a 0.25% cut in July. Powell also emphasized the Fed's independence even as President Trump reportedly considered demoting the Chair for the Fed's inaction earlier this year. MSCI US Index returned 1.3% for the quarter in Rand terms
Other International equities underperformed the US, even as the US Dollar weakened. Developed markets in Rand terms, as measured by the MSCI EAFE Index, rose 0.9% for the quarter, driven by Germany 4.2%, France 3.6%, and Switzerland 5.5%. The UK disappointed with -1.8% due to uncertainty surrounding Brexit and Prime Minister May's announced resignation.
Emerging market shares had a volatile second quarter and is still lagging behind developed markets. For the year ending in June 2019 the MSCI EM Index underperformed the MSCI World Index (developed markets) by 6.3%.
US-China trade tensions were rekindled in May as talks unexpectedly broke down and both sides implemented new tariffs. However, hopes for a resumption of talks post the G20 summit in June and rising expectations that the US Fed will cut interest rates, proved supportive later in the period. Emerging markets, as measured by the MSCI EM Index in Rand terms, fell 2.1% for the quarter. China, the best performer last quarter, fell 6.6% on slowing data and trade tensions. In 2019, the standout performer has been Russia, with a 13.7% rally in Q2, a 29.2% rise for the year. A YTD rebound in oil coupled with a lower likelihood of US sanctions drove the emerging market economy's stock market and currency soaring.
The FTSE/JSE ALSI rose 3.9% in the quarter bringing it to 12.2% for the year. The financials sector gained 5.4%, while the industrial sector gain 4.0%. In June, SA equity markets followed global markets higher and ended the month 4.8% up. Resources were the largest contributor to returns in the month. The Resources sector soared 10.2% in the month on higher gold prices. The dollar price of gold increased by 7.9% in the month, responding to investors seeking protection against rising uncertainty. The dollar price of platinum picked up 2.5% in the same period.
The SA 10-year government bond yield increased by 30 basis points in June and ended the month at 8.7%. SA Fixed Rate Bonds (ALBI) lifted 2.2% in the month, while the SA Inflation Bonds (ILBI) underperformed with -0.1%. Meanwhile, the SA Listed Property increased by 2.2% in June bringing it to 6.0% for the year.
The portfolio will consist of a mix of collective investment scheme portfolios investing in equity, bond and property markets and money market instruments. The portfolio shall adhere to the multi asset: medium equity classification requirements as set out by the Asisa standard: fund classification for South African regulated collective investment scheme portfolios. Investments to be included in the portfolios will, apart from assets in liquid form, consist solely of participatory interests in portfolios of collective investment schemes registered in the Republic of South Africa or of participatory interest in collective investment schemes or other similar schemes operated in territories with a regulatory environment which is to the satisfaction of the manager and trustee of a sufficient standard to provide investor protection at least equivalent to that in South Africa.
The Manager shall be permitted to invest on behalf of the three portfolios in offshore investments as legislation permits.
The portfolios will also be allowed to invest in listed and unlisted financial instruments (derivatives) as allowed by the Act from time to time.