NAV on 2019/09/13
|NAV on 2019/09/12
|52 week high on 2019/07/31
|52 week low on 2018/11/01
|Total Expense Ratio on 2019/06/30
|Total Expense Ratio (performance fee) on 2019/06/30
STANLIB Collective Investments (RF) Limited
South African--Interest Bearing--Short Term
STeFi Composite Index
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.
In addition to investment knowledge, Jennifer brings valuable experience and diversity to the team and it is expected that she will contribute at the highest level. Jennifer joined the team from Standard Bank Group Securities where she was an Equity Analyst covering Media, Electronic and IT stocks. She has over seven years of investment experience and has been highly rated in her area of expertise.
STANLIB MM Enhanced Yield comment - Mar 19
Global markets turned dovish during the quarter on the back of slowing growth in the US and Europe. Global bond yields therefore fell as the US Fed moved from two prospective hikes to no hikes. As a result of the dovish statements from the two regions, the US 10-year government bond repriced from 2.68% in December to 2.41% at the end of March, while German bond yields fell from 0.24% to -0.07%. South African fixed income assets followed the trend, as the 10-year government bond rallied from 8.87% to 8.60%. SA bonds returned 3.8% driven largely by the long end of the curve where the 12+ area was up 4.0%. SA cash returned 1.7%, and like bonds, 6- and 12-month NCDs outperformed short-dated instruments, rallying 1.8% and 1.9% respectively.
Pleasingly, the Fund delivered a 2.2% return for the quarter and 8.9% over the 12-month period on a gross basis. All of the underlying managers outperformed the STeFI Composite. In an environment where long-term yields have been declining, income-oriented managers with longer duration have delivered good performance. Both Aluwani and STANLIB have more income-oriented mandates, with both producing good alpha. STANLIB’s alpha has been driven by good placement on the curve and yield pick-up.
Prescient’s more cash-plus type mandate produced reasonable returns with a low duration position reducing alpha. Within the market context both the Investec and STANLIB money market funds produced satisfactory results.
The Fund continues to perform in line with peers.
Portfolio positioning and outlook
The Fund continues to be overweight income-oriented managers. This should continue to benefit investors in a contained interest rate environment. 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 and continued low growth in SA, the underlying managers reflect a more positive view on SA bonds. Having said that inflation seems well under control, the escalating oil price and above inflation electricity increases granted to Eskom by NERSA pose a threat to the inflation outlook. The FRA curve, however, does not seem to be concerned about inflation and is pricing no changes to interest rates this year and a small probability of interest rate cuts in 2020.
The Fund is an enhanced cash plus solution that invests in short-term interest earning and money market instruments. It is diversified across different types of money market, enhanced yield and income type strategies to ensure that the Fund is conservative, liquid and competitive in the ASISA Interest Bearing Short Term sector.
The Fund is benchmarked against the STeFI Composite Index, with the aim of delivering regular income distributions and performance in excess of money market return.