NAV on 2019/11/11
|NAV on 2019/11/08
|52 week high on 2019/11/11
|52 week low on 2018/12/28
|Total Expense Ratio on 2019/06/30
|Total Expense Ratio (performance fee) on 2019/06/30
Satrix Managers (Pty) Ltd.
MSCI World Equity Index (Developed Markets)
Johann has 24 years investment experience of which 14 years was spent as an equity analyst. The last 10 years were spent as a portfolio manager.
He was one of the founder members of the large cap team and played a role in designing the large cap investment process.
He is currently a member of the equity selection group at Sanlam Investment Management.
Satrix Investment Team
Satrix MSCI World Equity Index Feeder Fund-Sep 19
In Quarter 3, the MSCI EMEA index (which includes South Africa) fell 7.02%, which was worse than the returns of that of the MSCI Emerging Markets (EM) at -4.25% and far behind the MSCI World’s 0.53%. Year to date, the picture do not change much with the MSCI EMEA at 5.13%, relative to the MSCI EM return of 5.89% and way behind the 17.61% for the MSCI World.
The Federal Reserve and the European Central Bank both eased policies to offset signs of weaker global growth. The US economy has weakened but is not in a recession mainly due to fiscal support offsetting the adverse impact of the trade war. The inversion of the US yield curve is perceived as tolling the bell for a near-term global recession whilst Draghi also added to the call for fiscal easing.
Adding to that, commodity prices took a dive with key iron ore benchmark prices plunging some 20% in a matter of weeks and the key industrial metal, copper, hitting two-year lows. The key global manufacturing indices have also dived and are at fiveyear lows - but was at least stable over the last two months.
In the UK, Eurosceptic Boris Johnson has become the prime minister after being elected as leader of the Tories. There appears a greater likelihood of a no-deal Brexit or, at the very least, yet another postponement of the October decision deadline. The market has discounted this in large part with a weaker Sterling. As business decisions get postponed, the UK could dip into a technical recession.
Our feeder fund buys and sells units in a “parent fund” called the Satrix MSCI World Index fund, which tracks 23 developed countries with more than 1600 shares included in the index. We track this index through a process of optimization with an ex- ante tracking error varying around 15 basis points.
The MSCI World Index (in Rand terms) managed a return of about 8.1% (0.53% in USD terms) over the past three months. This difference in return was mainly due to the rand weakening by close to 7% against the US Dollar over this period.
For the year to date the Rand return for this index was around 23.9% (17.6% in USD terms), with rand depreciation playing a major role.
As the economy drifts lower as a result of lower manufacturing production, the Fed may have more urgency to intervene. Non-farm payrolls remain resilient, which points to the fact that the US is not on the brink of a recession. It remains key that core goods inflation remains stable around 3% to give room to the Fed to cut rates. It’s becoming clear that a trade war has negative consequences for US growth and core inflation.
The objective of the Satrix MSCI World Equity Index Feeder Fund is to provide an investment vehicle for investors wishing to track the movement of the MSCI World Equity Index (Developed Markets) by investing in securities of global companies which are primarily constituents of the MSCI World Equity Index (Developed Markets).
The portfolio will apart from assets in liquid form, invest in participatory interests of the Sanlam World Equity Tracker Fund established under the Sanlam Universal Funds PLC approved by the Irish Regulator in August 2011. The Sanlam World Equity Tracker Fund will employ replication, sampling and optimisation techniques and, subject to the limits and within the conditions laid down by the Central Bank of Ireland, may use financial derivative instruments for efficient portfolio management purposes to track the performance of the MSCI World Equity Index (Developed Markets), rather than attempting to hold all of the securities in the MSCI World Equity Index (DevelopedMarkets). The Sanlam World Equity Tracker Fund may also invest indirectly in such securities through quoted investment vehicles, such as Exchange Traded Funds, and holdings in UCITS funds domiciled in a Member State and other open-ended collective investment schemes that satisfy the requirements of the Central Bank of Ireland.