NAV on 2019/07/22
|NAV on 2019/07/19
|52 week high on 2018/09/04
|52 week low on 2019/01/04
|Total Expense Ratio on 2019/03/31
|Total Expense Ratio (performance fee) on 2019/03/31
STANLIB Collective Investments (RF) Limited
South African--Multi Asset--High Equity
FTSE/JSE SWIX Index, BEASSA ALBI Index, STeFI Call Deposit, FTSE/JSE SAPY Index, MSCI AC World IMI Index, Barclays Global Multiverse Index, 50% Overnight Dollar Libor Rate, 50% Overnight Euro Libor Rate
Malcolm Holmes has 11 years investment experience and has been a portfolio manager in his own right, which makes him the perfect candidate to oversee the evaluation of the underlying managers and their portfolios. As the head portfolio manager, Malcolm is the key person responsible for product development and design at STANLIB Multi-Manager. He is responsible for ensuring that our products meet their investment objectives and that the underlying managers meet their mandates.
STANLIB Multi-Manager was established in 1999 and is the centre of excellence for multi-managed solutions within STANLIB. The investment team, led by Chief Investment Officer Joao Frasco, consists of an experienced team with a diverse set of investment skills. We have offices in Johannesburg and London, and currently have mandates in excess of R90 billion under stewardship.
STANLIB Multi-Manager Funds are designed to deliver superior investment returns more consistently than through a single asset manager or mandate. Our approach allows investors’ to outsource the fund / manager selection decision, which includes the ongoing due diligence of managers and construction of portfolios, to meet pre-defined objectives over time.
Risk management is a fundamental component of our investment philosophy and process and is therefore approached holistically. It permeates every part of our investment process, requiring participation and accountability from all individuals involved in the process.
Naweed joined the STANLIB Multi-Manager Research and Development Team at as a Quantitative Analyst. Prior to STANLIB, Naweed was a Portfolio Risk Analyst at Eminence Partners, a Johannesburg-based long/short equity hedge fund operated under the Peregrine fund platform.
Stanlib MM High Equity FoF Comment - Mar 19
Global equities returned 12.6% in rand terms, driven by the positive impact of trade talks and the dovish US Fed tone. European equities bucked the global trend, retreating 0.8% in US dollar terms on the back of a broad economic slowdown in the region. SA markets rallied 3.9%, driven primarily by resources, which gained17.8% and in particular, iron ore, palladium and platinum.
The SA 10-year government bond rallied from 8.87% to 8.60%. As developed market central bankers started implying that there would be no interest rate hikes in 2019, foreign investors bought up $0.5 billion of SA bonds. SA cash gained 1.7% for the quarter. Following a dismal 2018 the listed property market enjoyed a welcome bounce back in January. Disappointingly, the momentum faded, and listed property finished the quarter up only 1.3%. Portfolio review
The Fund returned 5.8% on a net basis for the quarter. This is a reasonable return considering the bounce in domestic equity and listed property in January, albeit short-lived in the property space. The Fund is 1.5% behind peers over the year but has a pleasing longer-term track record.
The Fund is constructed using underlying STANLIB Multi-Manager building blocks to gain exposure to various asset classes. Going into the quarter, the local bond building block was slightly short the long end of the curve, thus underperforming the ALBI for the quarter. It still managed to deliver alpha of 1.3% ahead of the benchmark on a gross basis over the 12-month period. The cash building block delivered a quarterly return of 1.93%, outperforming the benchmark by 0.15%.
The absolute income building block returned 2.1% for the quarter after fees. Over the three-year period, it returned 8.7% per annum, well ahead of income fund peers at 7.7%, and 3.9% above inflation. Its conservative positioning and avoidance of high allocations to property were the largest contributors to the stellar performance. The property building block returned 1.4% for the quarter, well ahead of peers at 0.7% and outperforming the All Property Index (ALPI) benchmark.
STANLIB Multi-Manager Global Equity underperformed the benchmark for the quarter due to overweight positions in emerging markets (EM) and financials that dragged on performance. Sands produced another positive quarter of alpha, with stock selection contributing strongly. STANLIB Multi- Manager Global Bond performed in line with the benchmark for the quarter. Exposure to credit and EMs contributed, while developed markets lagged. During February, we replaced Capital with PIMCO.
Portfolio positioning and outlook
We caution that global equity markets are back to their highs, presenting some vulnerability especially as US economic activity is losing momentum. We will use rand weakness opportunities to trim the Fund’s overweight exposure to global equity. On the positive side, our underlying managers continue to see value in domestic shares and we therefore have a small overweight exposure to this asset class. From an economic point of view, many of the Fund’s underlying managers have indicated that inflation is expected to remain firmly within the 3% - 6% band, with the SARB targeting more the middle of the band. For this reason, as well as the continued low rate of growth in SA, the underlying managers maintain a more positive view on SA bonds.
The Fund adopts the specialist approach whereby exposure to each asset class is gained via a multi-managed building block. It is well diversified across domestic and foreign asset classes. Its main objective is to provide long-term growth of capital and modest income, with a low probability of capital loss over the long term. The Fund aims to achieve CPI+6% p.a over 6-year rolling periods.
The Fund is exposed to multiple best-of-breed managers, investment styles, asset classes and strategies providing investors with additional diversification benefits. The tactical exposure to each asset class is actively managed - expected total equity content of between 65% and 75%. The Fund is regulation 28 compliant.