NAV on 2019/07/19
|NAV on 2019/07/18
|52 week high on 2019/06/28
|52 week low on 2018/08/01
|Total Expense Ratio on 2019/03/31
|Total Expense Ratio (performance fee) on 2019/03/31
Sanlam Collective Investments
South African--Multi Asset--Income
Stefi + 1% per annum
No email address listed.
No website listed.
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.
Sam has been appointed head of the Unconstrained Strategies team at Momentum Asset Management and brings 16 years' of domestic and global investment experience to the firm. Sam was at Investec Asset Management until September 2011, where he held the positions of director, head of South African equities and portfolio manager in the Global Contrarian team. He started his career in the investment management industry at Allan Gray and moved to Abvest (now ABSA Asset Management), where he fulfilled the roles of portfolio manager, chief investment officer and, ultimately, chief executive officer, before leaving to join Investec Asset Management in early 2006. He headed a team of investment professionals responsible for well over R100 billion in equities across the full spectrum of portfolios, from pure equity to multiasset mandates. He was the lead portfolio manager and key decision maker for close on R40 billion in client assets, including the Investec Global Franchise Fund and Investec Cautious Managed Fund. He also managed the Discovery Equity Fund from its inception in November 2007.
Counterpoint SCI Enhanced Income Fund - Mar 19
The first quarter of 2019 was characterised by three events of primary importance for the domestic fixed interest market. The first, and probably the most impactful, was the lowering of interest rate expectations in the United States of America. Data indicating a slowing economy under a benign inflationary environment caused the Fed to issue a dovish FOMC statement at their March meeting. The market has since revised downwards its expectations of US interest rates cuts to a flat trajectory over 2019 after expecting two-to-three 25 b.p. hikes from the Fed at the beginning of the year. This caused US and global bonds to rally strongly and gave support to global fixed interest markets overall. The German 10y bund dipped into negative territory once again, and the South Africa government R2030 bond rallied to end the quarter at 9.15% after starting the quarter at 9.39%.
The National Budget in February was another key event. Finance minister Tito Mboweni reminded parliament that the time for austerity had come, and symbolised this by parading a bitter Aloe ferox plant to parliamentarians. The South Africa fiscus has the challenge of squaring enormous expectations with a revenue pool that is under pressure given the weak economy. It must also manage down its ballooning wage bill, and appears compelled to support the troubled state-owned institutions which continue to consume resources. Business and consumer confidence continues to fall, and with it government revenues, whose projection over the medium term is for debt to GDP to breach the 60% level. The picture has worsened since budget day. SARS has just released preliminary tax figures for the 2018/9 fiscal year, and its headline collections data showed a net tax revenue shortfall of R14.6bn relative to the 2019 budget estimates, which should push the government’s budget deficit top 4.6% of GDP for the current fiscal year.
No less important was Moody’s rather puzzling decision not to release a ratings review for South Africa on its scheduled rating date (29... March). In a follow-up credit opinion, it left the country’s domestic currency credit rating unchanged at Baa3 with a stable outlook. Despite Moody’s complicated ratings methodology, this rating assessment puzzled those economists expecting a change in outlook to negative from neutral. It is possible that Moody’s is giving weight to older data in its fiscal strength assessment, as the fiscal metrics have certainly deteriorated markedly since South Africa was first given the current rating. For the moment, South Africa has been granted some grace; there is a wait-andsee attitude on the part on both the credit rating agency and investors to see whether the government follows through with its intent to implement strict governance measures and reforms after the May elections. Much volatility can therefore be expected in the domestic fixed interest market before clarity is achieved on this front.
The Counterpoint Enhanced Income fund continues to attract investors, having grown its AuM from R697m to R804m over the quarter, an increase of 15.5%. The fund returned 2.11% after costs over Q1 2019, which compared favourably to cash (1.73%), inflationlinked bonds (0.50%) and property (1.45%) over this period, but underperformed SA bonds (3.76%), which benefitted from a tailwind from US interest rates and a reprieve from Moody’s despite a faltering credit underpin.
The steady performance of the fund has found favour with investors, but flows into the fund has admittedly also benefitted from asset allocation decisions swinging away from more volatile asset classes which have not performed well over the past few years. The upcoming elections as well as geopolitical complications (Brexit, US-China trade negotiations etc.) should keep the SA fixed interest market in a higher than usual volatility band in Q2 2019. Given the anticipated bumpy investing landscape, the fund will stick to its cautious investment profile over the coming quarter, availing itself of opportunities as they arise.
Investments to be included in the portfolio will, apart from assets in liquid form, consist of non-equity securities, fixed interest instruments (including, but not limited to, bonds, cash deposits and money market instruments), preference shares of an income nature and listed property securities as well as any other income enhancing securities which are considered consistent with the portfolio's primary objective and that the Act or Registrar may allow from time to time. In order to achieve the portfolio objective, the portfolio's asset allocation and instrument selection will be actively managed and will continually reflect the portfolio Manager's view of the relative attractiveness of the property shares, property related securities, loan stock listed on exchanges, non-equity securities, bonds, money market instruments and preference share markets. Apart from achieving the primary objective of generating high income, the portfolio will actively invest in bonds and/or property securities in order to achieve the secondary objective of long term capital growth. The portfolio's property exposure will be aligned with that of the Asisa Multi Asset Income portfolios category. The portfolio may also invest in listed and unlisted financial instruments in accordance with the Act as well as in offshore investments as permitted by legislation. The Manager may also include participatory interests and other forms of participation of local and global 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 and which is consistent with the portfolio's primary objective.