NAV on 2019/01/16
|NAV on 2019/01/15
|52 week high on 2018/08/30
|52 week low on 2019/01/04
|Total Expense Ratio on 2018/09/30
|Total Expense Ratio (performance fee) on 2018/09/30
Boutique Collective Investments (RF) (Pty) Ltd.
South African--Multi Asset--Flexible
CPI + 4% p.a.
RCI MET Flexible Managed comment - Sep 13
We identify two major long-term drivers for the South African economy:
1. The demand for resources from China (which would be aided by a weaker rand), is under pressure as the new Chinese government has yet to decide how strongly it will stimulate infrastructure spending. It is vital that metal prices remain fairly high. The South African government's policies on BEE, mining royalties, labour practices and licence uncertainties, added to the intransigence of labour unions and problems with electricity supply and transport makes this a very difficult sector to earn good returns or shareholders at the moment.
2. Growth in the emerging middle class, benefiting retailers, banks and infrastructural spending.
Our economy is experiencing sluggish and patchy growth, aggravated by strikes. However, increased employment from Government and high wage increase in both public and private sector, as well as increasing numbers on welfare, led to buoyant retail sales growth up to 2012. Due to diminishing tax revenues, increases will be muted so retail sales growth is expected to slow in 2013. This has led to an abrupt fall in retail share prices which had run too far. 2013 should be a 'muddle through' year.
With the above drivers being weak, most of the action has occurred in the large rand hedge shares such as Naspers, British American Tobacco and Richemont. On the positive side, growth in the US economy should pick up and some cash is being diverted to shares from cash deposits and bonds. This should result into a spillover into all emerging markets including South Africa. We expect both market and rand volatility over the next few months which might provide some buying opportunities. We have a reasonably high level of cash (about 15%) and will nibble at opportunities during market weakness.
The portfolio is managed with the aim of delivering positive returns over the medium term in excess of CPI plus 4%. We hope to achieve this by actively managing the asset allocation of the portfolio to reduce downside risk. The portfolio invests in a mix of shares listed on recognised exchanges, gilts and liquid assets. The bulk of the portfolio is invested in 20 to 30 shares picked from a pool of the 100 most marketable shares on the Johannesburg Securities Exchange. Up to 25% may be invested in offshore shares, the bulk of which will be in consumer related shares where the demand for their products
is largely unaffected by economic conditions. The manager makes the investments decisions based on a combination of market behavioural analysis, fundamental analysis and quantitative analysis.