NAV on 2019/01/18
|NAV on 2019/01/17
|52 week high on 2018/09/05
|52 week low on 2018/02/12
|Total Expense Ratio on 2018/09/30
|Total Expense Ratio (performance fee) on 2018/09/30
Sanlam Collective Investments
South African--Multi Asset--Low Equity
25% SWIX, 55% ALBI, 20% SteFi
No email address listed.
No website listed.
Steve has a B.Sc. (Engineering), B.Com (Hons.) and an MBA degree, all from UCT.
He began his career in 1988 as small cap portfolio manager at Old Mutual. He moved to Investec Asset Management as head of equity portfolio management in 1991 and in 1992 moved to Norwich Investments as their chief investment officer.
In 1995 he became MD of Brait Asset Management (then Capital Alliance Asset Management). In 1997 he became the CIO of Fleming Martin Asset Management, and he moved over to Mercury Specialised Fund Managers in the same role in 1999.
He joined SIM in November 2001 and is currently head of portfolio management. He is also head of alternative investments and collective investment portfolios.
Joined Fleming Asset Management in August 1997. Alex was previously a quantitative analyst and economist at Capital Alliance. He has specialised in fixed interest for the past two years.
Counterpoint SCI Cautious Fund - Sep 18
The third quarter of 2018 saw a continuation of the 'risk-off' trend of previous quarters. The US Equity market bucked the trend, led by the Tech heavy Nasdaq which maintained strong positive momentum.
The growing disparity across markets and economies intensified over the quarter even though trade war rhetoric and related actions waned slightly. The Fed maintained their commitment to quantitative tightening, which bouyed the US Dollar and maintained pressure on Emerging Markets.
The CBOE Volatility Index (VIX) held steady, with a slight downward bias from the spike in February. Volatility has been relatively stable since the significant turbulence in early 2018. Heightened investor complacency and apparent lack of fear remain a worry - a repeat of the VIX spike in February will lead to sudden and deep drawdowns in risk assets.
Another feature of the quarter was the stability of higher risk-premia across various asset classes. Securities prices have not rebounded quickly, as was the case in previous cycles. Emerging market securities are declining at slower rate but the synchronized global narrative no longer provides support.
Global Bond yields rose across the board. Emerging market bonds were the hardest hit, with a 10.4% decline in dollars. US Bonds were once gain the most resilient. Turkish bonds declining by 21.6% and Brazilian bonds by 15.7%.
For the quarter, most major asset classes declined with relatively few safe havens. Gold declined by --8.3%. The US Dollar strengthened based on relative yield considerations and an underlying growth narrative.
The MSCI World Index appreciated by 5.1% compared to the MSCI Emerging Market Index which declined by 0.9% over the quarter.
Global property, as measured by the iShares Developed Market Property Yield ETF which tracks the FTSE EPRA / NAREIT Developed Index had an uneventful quarter with slight decline of 0.15%
On the domestic front, a significant driver of returns was the weakness of the rand as a consequence of sustained US dollar strength and EM weakness.
The performance of fixed income securities was surprisingly resilient. The All Bond Index managed a positive return of 0.80% and inflation-linked bonds, as measured by the JSE CILI Index followed suit with a 0.60% return. Cash, as measured by the STeFI index, returned a steady 1.70%. The JSE Preference Share Index has a solid quarter with a positive return of 2.59%. Listed Property continued to struggle with a decline of 1.03% which takes the year to date decline to 22.16% and the sector is now firmly in a bear market.
The All Share Index declined by 2.2% to reverse some of the previous quarter's gains. SA Resources led the way, with a 5.2% return, followed by Financials with 2.8%. SA Industrials were the hardest hit and caused the drag on the entire index, with a decline of 7.8%.
Emerging Market contagion persisted, albeit at lower intensity. Domestic Policymakers and leadership have demonstrated a resolve and ability to address the structural impediments in the fiscus and critical institutions. The process is underway and will take time. The decline in domestic assets has led to less euphoric valuations and represents an opportunity for investors to participate in the recovery on a more rational basis.
The probability is high that equities, as an asset class, could continue to muddle through. Risk assets remain extremely vulnerable to either a recession or a sudden increase in bond yields.
For that reason, we continue to advocate caution and conservatism, with adequate diversification across portfolio's.
The Fund appreciated by 1.75%, well ahead of the average fund and the rare achievement of being the best performing fund in the sector on a year to date basis. Performance was more than satisfactory in a quarter when many asset classes experienced fairly significant declines.
The fund navigated a volatile third quarter incredibly well. Our intentional bias towards diversification and conservatism came to the fore as preference shares, cash and off-shore equities generated positive returns and dampened the downside volatility in domestic assets.
The net result was above-average performance for the quarter and builds on the excellent relative performance of the Fund since the middle of 2017.
Our stock selection discipline and asset allocation experience enabled us to maintain our trend of avoiding or averting the worst performing securities and sectors. Our underweight in domestic bonds and listed property added significant value. In equities, our reduced exposure to the domestic consumer added value, as general retailers declined significantly.
In domestic equities we had solid results for the quarter. Stock selection was reasonable and enabled the fund to hold up better than the average fund. In addition, the lower allocation added value in terms of asset allocation.
Our global equities performed well in absolute terms due to good stock selection and provided both diversification and a currency tailwind. The solid dollar performance of our global equities was augmented by Rand weakness and added significant value over the quarter. Our overweight allocation to Global Equities more than compensated for the lower domestic equity weighing.
Above-average cash provided a drag on performance over the quarter.
The fund positioning and strategy remains virtually unchanged.
We remain marginally under-weight equities and within equities, we favour quality and global. Our foreign exposure is remains high, due to rand weakness and market movements.
We re-configured our domestic equity exposure during the quarter as value re-emerged after an extended sell-off. We increase our listed property exposure and we anticipate moving to overweight in future.
Our Fixed Income exposure is inherently conservative, lower duration and adequately diversified. We increased our government bond exposure during the sporadic declines during the quarter. We have no parastatal or SOE debt exposure.
Cash is a residual outcome of our investment process. Cash balances declined marginally over the quarter as we found new opportunities to deploy capital. It is likely that cash will reduce even further. The decline in domestically oriented asset classes (bonds & equities) over the quarter has led to more reasonable valuations and attractive opportunities for diversification.
In order to achieve this objective the investments to be acquired for the portfolio will cover the full spectrum of securities, and include equities, participatory interests in collective investment schemes in property, loan stock listed on exchanges, non-equity securities, preference shares, bonds, money market instruments and assets in liquid form. The Manager may make active use of listed and unlisted financial instruments to reduce the risk that a general decline in the value of equity markets may have on the value of the portfolio. The manager may from time to time invest in participatory interests in portfolios of collective investment schemes registered in the Republic of South Africa and which are consistent with the portfolio's primary objective. The equity limits will be aligned with that of the Asisa Fund Classification: SA - Multi Asset - Low Equity. The use of derivative strategies may be pursued actively and will only be limited by the statutory limitations placed on the inclusion of financial instruments in portfolios. The Manager shall be permitted to invest on behalf of the portfolio in offshore investments as legislation permits. The portfolio will be managed in accordance with regulations governing pension funds.