NAV on 2019/01/17
|NAV on 2019/01/16
|52 week high on 2018/01/25
|52 week low on 2019/01/02
|Total Expense Ratio on 2018/09/30
|Total Expense Ratio (performance fee) on 2018/09/30
Sanlam Collective Investments
South African--Multi Asset--Medium Equity
South African Multi Asset Medium Equity Category
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GraySwan SCI* Cautious Fund of Funds - Sep 18
Over the third Quarter of 2018 the U.S. has dominated capital market headlines, amid strong corporate earnings and solid economic growth. U.S. equity markets hit a series of new record highs during the quarter. During the third quarter the S&P 500 returned 7.7%, while the MSCI ACWI ex US could only manage a return of 0.7% in dollar terms.
US equities have done exceptionally well since the global financial crisis, while the recent Trump/Republican pro-growth agenda has extended this booming economy and earnings outlook, but may now also be sowing the seeds for the end of the cycle as the Fed is forced to raise rates and tighten policy in a more deliberate manner.
European stocks rose modestly amid solid corporate earnings growth and signs of higher inflation. European markets were tempered by investors worries about slowing economic growth and the negative impact of global trade tensions on Europe’s trade-dependent economy. Overall, the MSCI Europe Index gained 1% in local currency terms and the Euro slipped 1% against the U.S. dollar.
Tighter US monetary policy, concerns about the impact of global trade tensions and the slowing pace of Chinese credit growth have been the main headwind for developing economies. The combination of rising U.S. interest rates and dollar strength triggered a sell-off in Turkish and Argentine assets and raised questions about the vulnerabilities of other developing countries. Several currencies fell to all-time lows against the U.S. dollar.
The recent selloff in emerging markets has restored a lot of value, which is increasing the already large discount relative to developed markets. The uncertainty around trade will most likely continue, but a lot of this uncertainty has already been priced into the market. We see opportunity in emerging markets on the back of strengthening fundamentals.
In the domestic markets we have been faced with additional headwinds from general political uncertainty leading to low levels of confidence and weak growth. During the ongoing Zondo commission investigations Finance Minister Nhlanhla Nene has reportedly asked President Cyril Ramaphosa to relieve him of his duties after he disclosed he had meetings with the Gupta family. This paved the way for Tito Mboweni, South Africa’s sixth Finance Minister since December 2015. Investor can take solace in the fact that Mboweni is not new to the financial sector as he was at the helm of the Reserve Bank for 10 years.
Asset class performance in ZAR: Q3 | Year-to-date: Local Cash 1.8% | 5.4% Local Nominal Bonds 0.8% | 4.8% Local Inflation Linked Bonds 0.6% | -0.7% Local Equities -3.3% | -8.0% Local Listed Property -1.0% | -22.2% Foreign Bonds 2.1% | 11.6% Foreign Equity 7.5% | 18.7% USD/ZAR 3.1% | 14.4%
The portfolio will consist of a mix of collective investment scheme portfolios investing in equity, bond and property markets and money market instruments.
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.