NAV on 2019/03/22
|NAV on 2019/03/21
|52 week high on 2018/09/05
|52 week low on 2018/03/26
|Total Expense Ratio on 2018/12/31
|Total Expense Ratio (performance fee) on 2018/12/31
STANLIB Collective Investments (RF) Limited
Global--Interest Bearing--Variable Term
90% Citi Eurodollar Bond index; 10% Alexander Forbes Money Market index
After completing his articles at Alex Aitken and Carter he joined UAL Merchant Bank in 1979, initially assisting as a portfolio manager and later working as an investment analyst. After completion of a full time MBA he relocated to the USA where he spent nine years as a stockbroker/financial consultant, mostly with Shearson Lehman Bros. He returned to South Africa in 1992 and joined Old Mutual Invesments with involvement in portfolio management and client report backs. He joined SCMB Asset Management division in 1995, after a stint in portfolio management at RMB Asset Management. Paul Hansen is responsible for managing the onshore portion and Fidelity Investment Managers the offshore portion.
Brandywine Global Investment Management
STANLIB Global Bond Feeder Fund - Sep 18
The Fund’s return for the third quarter was 2.25% in rand terms compared to the benchmark return of 3.71%. The fund returned 10.66% for the year to date, compared to the benchmark year to date return of 11.81%. In dollar terms the fund outperformed the benchmark by 0.18% for the quarter. The year to date outperformance can mainly be attributed to the weakening of the Rand against the US Dollar. The Rand closed the quarter off at R14.14 to the US Dollar after trading at R13.73 at the end of June 2018. This resulted in the fund making positive returns in rand terms. The Rand is still volatile due to economic uncertainty and a low growth environment in South Africa.
The fund increased in size from R825 million at the end of the first quarter to R827 million at the end of September 2018.
Performance during the third quarter began to stage partial recoveries from the relative drawdowns that took place in the second quarter. Despite coming under pressure in August amid a broader selloff in emerging market assets and currencies, the Mexican peso recovered strongly in the wake of a new trade deal with the U.S. and Canada. However, Mexican government bond yields were higher across the yield curve for the quarter, and the portfolio’s exposure to longer-dated Mexican bonos detracted from results. Attribution was positive against the yen and euro as well, owing to our underweights relative to the benchmark. Interest rate differentials between the U.S. and Japan, a hawkish Federal Reserve, and trade uncertainty sent the Japanese yen lower against the U.S. dollar. Reduced European growth expectations and Italy’s rising political risks, including a surprise move by the new government approving a significant increase in Italy’s budget deficit, weighed on the euro. Accordingly, lack of exposure to Japanese and Italian bonds benefited the portfolio during the quarter. Our decision to overweight the front end of the U.K. bond market was positive as longer-dated gilts sold off and yields rose amid ongoing uncertainty around Britain’s withdrawal from the EU. Although primarily utilized for cash management, U.S. investment grade corporate bonds contributed to quarterly results. These gains were offset by marginal declines across our emerging market (EM) currency positions. Trade tensions, weakening global growth, and a stronger U.S. dollar all weighed on emerging markets during the quarter. In particular, August witnessed a sharp selloff that began with Turkey and Argentina. These markets triggered a broader rout and a general shift among investors toward risk-off behaviour mid-quarter. Exposure to Turkish bonds and the lira detracted from overall results, as did unhedged sovereign bond positions in South Africa and Indonesia. The Turkish lira fell victim to U.S. sanctions and concerns over the efficacy and independence of the central bank. South African yields were modestly higher for the quarter due to selloffs triggered by weak economic data and emerging market spill over effects.
Heading into the final quarter of the year, the portfolio largely retains its overall structure: underweight global duration but with duration concentrated mainly in select emerging markets. Heavy weightings continue in Mexico, Brazil, South Africa, and Indonesia with underweights to the U.S. dollar, the euro, and the yen in favour of the emerging world.
The commentary gives the views of the portfolio manager at the time of writing. Any forecasts or commentary included in this document are not guaranteed to occur.
The STANLIB Global Bond Feeder Fund will be a specialist feeder fund portfolio. The Manager will
seek to achieve an investment medium for investors, which shall have as its main objective longterm
growth of capital and income. Apart from assets in liquid form, it will consist solely of
participatory interests in a single portfolio of a collective investment scheme operated in territories
with a regulatory environment which is to the satisfaction of the manager and trustee of a sufficient
standard to provide investor protection at least equivalent to that in South Africa, namely the
STANLIB Global Bond Fund.