NAV on 2019/01/17
|NAV on 2019/01/16
|52 week high on 2018/01/25
|52 week low on 2018/10/23
|Total Expense Ratio on 2018/09/30
|Total Expense Ratio (performance fee) on 2018/09/30
Prescient Management Company Ltd. (PIM)
FTSE/JSE Shareholder Weighted All Share Index (SWIX)
Prescient Equity Income comment - Sept 18
Trade war rhetoric was once again the primary source of market volatility last month. Initially, markets were buoyed by lower than expected tariffs placed on imports by both the US and China, as the trade war was then deemed to be less severe than initially expected. At the same time, the US invited China to further trade talks, on which practitioners were most likely placing a high probability of a promising outcome. At the drop of a dime, this quickly changed when China called off the talks, which sent emerging markets into a tailspin. The MSCI World index added 4.53% in Q3 as demand for quality assets rose. Conversely, the MSCI Emerging Markets index lost -2.02% over the same period as risk off sentiment took its toll. US and EU markets were mostly up over the quarter with the S&P 500 and the CAC40 indices closing 7.20% and 3.19% up respectively. The DAX index lost -0.48% in Q3 as fears grew that Germany was next in line to face the wrath of Trump's nationalist policies. Domestically, SA officially entered a recession, which caught markets off guard to some extent. To counter this, President Ramaphosa released plans to ignite domestic growth, which was well received by markets. Nevertheless, the JSE All Share index ended the third quarter -2.17% in the red. This was driven largely by the Industrials sector, which shed -8.25% over the quarter. The Resources and Financials sectors on the other hand proved to be more resilient and ended up 4.60% and 4.20% respectively. The Prescient Equity Income Fund returned -0.41% ahead of the benchmark (-4.55%) for the month.
Contributors to Performance
The positions that contributed most to the performance of the fund were Kumba Iron Ore (+21.08), Anglo American PLC (+7.77%) and African Rainbow Minerals (+8.09%).
Detractors from Performance
The largest detractors from the months' performance were AVI Ltd (-8.38%), Imperial Holdings (-13.25%) and Life Healthcare Group (-7.88%).
INVESTMENT AND RETURN OBJECTIVE
The Fund aims to provide an income from dividends that is greater than the FTSE/JSE Africa Shareholder
Weighted Index by investing in shares that offer an attractive yield relative to the benchmark. It further aims to outperform the benchmark over the long-term.
The Fund uses quantitative techniques to build a high income equity portfolio which aims to deliver superior dividend income and performance relative to its benchmark. The selection process targets those shares that offer an attractive dividend yield but screens out high dividend yield shares that is out of favour. A further screen ensures that the portfolio is scalable and maintains high liquidity.