NAV on 2021/09/16
|NAV on 2021/09/15
|52 week high on 2021/08/31
|52 week low on 2020/10/30
|Total Expense Ratio on 2021/06/30
|Total Expense Ratio (performance fee) on 2021/06/30
Prescient Management Company Ltd. (PIM)
South African--Real Estate--General
FTSE/JSE Africa SA Listed Property
Prescient Equity Team
Prescient Property comment - Sep 19
The third quarter of 2019 delivered varied returns across global equity markets. The MSCI World, which has approximately 60% US weighting, and S&P500 Indices returned +0.08% and +1.19% in US dollars respectively following two consecutive rate cuts by the Fed. However, the global economic slowdown, rising trade war tensions and the strengthening US dollar have hampered emerging markets as evidenced by the MSCI Emerging Markets Index losing - 5.11% in US dollars over the quarter. For Britain, the domestic political turbulence and Brexit uncertainty hindered the FTSE 100 over the quarter, resulting in a dispiriting return of -3.52% in US dollars.
On shore, the economic burden of debt-ridden State-Owned Enterprises, faltering economic growth as well as the global market risk sentiment caused the rand to retract by -7.45% during the quarter. Consequent to this and escalating uncertainty surrounding the debt-relief bill and the National Health Insurance, the financial sector was the laggard of the quarter with the FTSE/JSE Africa Financial 15 Index losing -9.26%. From a broader market perspective, the FTSE/JSE Capped SWIX All Share and FTSE/JSE Top 40 Indices delivered -5.11% and -5.22% in ZAR respectively. This is the worst third-quarter performance since Q3 2011 on the back of a brilliant start to 2019. However, platinum miners and gold producers proved to be more resilient in the risk-off environment, with the likes of Northam (+40.88%), Impala (+36.60%) and Harmony (+36.42%) partially counteracting the underperformance of the JSE. The headlining market event of the quarter was the unbundling by Naspers Ltd. (NPN) of its internet company, Prosus NV (PRX). Both NPN and PRX had a strong start after the September 11th unbundling, however, they finished the month down -2.46% and -7.95% respectively.
The low risk enhancements that are utilised as part of the Prescient Property Equity Fund's investment process continued to add value for the quarter. The Fund returned -4.34% gross of fees, marginally ahead of the benchmark index return of -4.44% over the month. Contributors to Performance: The positions that contributed the most to the absolute performance of the Fund for the month of September were Resilient REIT Ltd (+7.53%), MAS Real Estate Inc (+14.11%) and Attacq Ltd (+11.82%).
Detractors from Performance: The largest detractors were Hyprop Investments Ltd (-6.03%), NEPI Rockcastle PLC (-1.30%) and Fortress REIT Ltd (-5.13%).
INVESTMENT AND RETURN OBJECTIVE
The Fund offers efficient and cost effective exposure to listed property as represented by the FTSE/JSE SA Listed Property Index. Tracking error to the index is minimised in the process.
The Fund is a property index fund where returns are enhanced by taking advantage of low risk arbitrage opportunities in the market. Additional benefits are gained from efficient implementation of cash flows, dividend reinvestments, management of corporate actions and index rebalancing. The Fund aims to remain fully invested in property shares at all times.