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103.42

NAV on 2019/01/18
NAV on 2019/01/17 103.41
52 week high on 2018/11/30 104.15
52 week low on 2018/09/04 102.08
Total Expense Ratio on 2018/12/31 0.83
Total Expense Ratio (performance fee) on 2018/12/31 0
NAV Incl Dividends
1 month change 0.79% 0.79%
3 month change 0.31% 2.18%
6 month change 0.22% 4.01%
1 year change 0.36% 8.1%
5 year change 0.28% 7.68%
10 year change 0% 0%
Price data is updated once a day.
  • Sectoral allocations
General Equity 16.45 6.02%
Liquid Assets 256.69 93.98%
  • Top five holdings
FINANCEINSTIT 207.72 76.05%
GOVTISSUPAPER 29.49 10.8%
DOMESTICFUNDE 16.45 6.02%
PUBLENTISSPAP 12.13 4.44%
CORPDTNONCVRT 7.03 2.57%
  • Performance against peers
  • Fund data  
Management company:
PSG Collective Investments (RF) Ltd.
Formation date:
2011/09/01
ISIN code:
ZAE000159265
Short name:
U-PSGINCO
Risk:
Unknown
Sector:
South African--Interest Bearing--Short Term
Benchmark:
Stefi Composite Index
Contact details

Email
assetmanagement@psg.co.za

Website
http://www.psg.co.za/asset-management

Telephone
021-799-8000

  • Fund management  
PSG Asset Management (Pty) Ltd.
Ian Scott
Tyron Green


  • Fund manager's comment

PSG Income comment - Jun 17

2017/09/08 00:00:00
Current context
Over the last year, most fixed income asset classes have rewarded investors with above-inflation returns. Cash returned 7.6% and government bonds returned 7.9%, while inflation over this period was 5.4%. The global environment is very supportive of local currency bonds and we have seen foreigners enter the local market as substantial buyers. In addition, credit spreads for large banks are falling, indicating good demand for credit in quality names. Not all fixed income asset classes have performed well, however. As a case in point, inflation-linked bonds returned -0.1% over the last year, due to the current downward phase of the inflation cycle.
Our perspective
The environment for fixed income investors is positive, despite the political noise we witness nearly daily and the fact that South Africa is in recession. While this is negative for the economy, it means that there is a low probability of rising inflation and hikes in short-term interest rates - which are negative for fixed income assets. In fact, consumer inflation has surprised on the low side in 2017, prompting short-term interest rate markets to price for interest rate cuts over the next year. Despite the negative growth environment and falling inflation, the South African Reserve Bank’s (SARB) Monetary Policy Committee has been erring on the side of caution by not reducing interest rates. We believe this creates good opportunity for our investors to invest in instruments offering high real yields at low levels of risk. The market is giving us a window of opportunity that may change soon.
We are still finding good opportunities in cash markets. In particular, banks are paying high yields in the front end of the curve to comply with banking regulations. We also continue to find opportunities for high real yields in the one-year and longer parts of the negotiable certificate of deposit market. We deem selective credit names attractive, but the recent increase in demand for bank credit has seen spreads narrow and we believe the opportunities in that sector are less than a year ago. As such, we are searching for opportunities in other areas of credit issuance.
Government bond yields are still attractive in the medium- to longer-dated area of the yield curve, despite current political noise. We believe that building a portfolio around a single negative narrative in bonds would expose our investors to binary outcome risks, which we aim to avoid. In addition, the valuations of long-dated bonds are not merely dependent on macro drivers. Factors like the strength of South Africa’s institutions, fiscal policy and term premium play a significant role as well. We believe a lot of negative news is already reflected in the yields of longer-dated bonds. If the SARB and National Treasury maintain the current policy framework, real yields of more than 3% on these bonds are attractive in a low growth and inflation environment.
Portfolio positioning
We have been allocating capital over the various interest rate curves where they have presented high real yield opportunities. Firstly, the long end of the cash curve - where banks are willing to pay higher yields for longer-term funding - remains attractive. We have also selectively added to our government bond position in the front end of the curve. Finally, we participated in credit issues where credit spreads met our fair value criteria. We believe that the fund is well positioned for investors and savers looking for high real yields at low levels of risk.
  • Fund focus and objective  
The investment objective of the PSG Income Fund is to maximise income while achieving long-term capital appreciation as interest rate cycles allow. In order to achieve its investment objective, the portfolio will be permitted to invest in assets in liquid form, a diversified range of fixed-interest securities, including but not limited to loan stock, debentures, debenture stock, bonds, unsecured notes and derivatives, whether they have inherent option rights or are convertible, as well as any other non-equity securities which may be approved by the Registrar from time to time and which are consistent with the investment policy of the portfolio.
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