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0.02  /  0.02%

101.21

NAV on 2019/11/18
NAV on 2019/11/15 101.19
52 week high on 2019/10/31 101.85
52 week low on 2019/01/11 100.08
Total Expense Ratio on 2019/09/30 0.69
Total Expense Ratio (performance fee) on 2019/09/30 0
NAV Incl Dividends
1 month change -0.33% 0.7%
3 month change 0.14% 2.3%
6 month change 0.14% 4.49%
1 year change 0% 0%
5 year change 0% 0%
10 year change 0% 0%
Price data is updated once a day.
  • Sectoral allocations
Fixed Interest 939.44 32.38%
Gilts 1857.92 64.04%
Liquid Assets 30.73 1.06%
Real Estate 72.96 2.52%
  • Top five holdings
U-RMBINPL 563.24 19.41%
U-NEDCSHP 325.51 11.22%
U-SYGPROP 72.96 2.52%
U-NEDCSHP 35.88 1.24%
U-SYGMMF 14.80 0.51%
  • Performance against peers
  • Fund data  
Management company:
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Contact details

Email
info@sygnia.co.za

Website
www.SYGNIA.co.za

Telephone
021-446-4940



  • Fund manager's comment

Sygnia Enhanced Income Fund - Jun 19

2019/08/29 00:00:00
MARKET PERFORMANCE
Developed-market central-bank policy easing has contributed to the longest-ever economic expansion - over 10 years. Global monetary policy easing reached new highs as the universe of negative-yielding bonds jumped to a record $13tn, gold to six-year highs and the S&P500 to all-time highs. Both the US Fed and ECB vowed to cut rates if necessary. The Bank of Japan has continued to ease monetary policy, because, on the back of trade tensions, global-manufacturing confidence indices have fallen into contraction, Citi's Global Economic Surprise Index has experienced the longest period of disappointing economic data on record and the Brent crude oil price dropped 20%. Amid escalating disputes, the World Bank downgraded its global growth outlook to the weakest pace in three years, forecasting 2.6% this year. The largest threat to the economic outlook is U.S. President Donald Trump's trade and tech wars, the latter being of particular concern, as 27% of the S&P500 Tech sector's revenue is exposed to China. Trump has an incentive to keep the market buoyant with 2020 elections around the corner, but the risk of miscalculation is high when using untested tools. Trump said that his meeting with China's President Xi Jinping at the G20 leaders' summit in Osaka went far better than expected and that he would not increase tariffs. He added, however, that he was 'in no hurry' to cut a trade deal.
South Africa's Q1 GDP fell the most in a decade, down 3.2% on the back of loadshedding issues. Seven of nine areas of the economy are in decline: agriculture declined a massive 13%, with farmers still unsure of their property rights, and mining was down 10% on power concerns. The rand lost considerable ground, breaking above R15 to the USD, and the yield curve rose to its steepest levels on record in response to a statement by ANC Secretary-General Ace Magashule that the organisation had decided to change the Reserve Bank mandate and begin 'quantity' easing. The ANC's economic transformation head, Enoch Godongwana, SARB governor Lesetja Kganyago, Finance Minister Tito Mboweni and President Cyril Ramaphosa confirmed that the party would not seek to nationalise the central bank nor expand its mandate. The South African Chamber of Commerce expressed concern that the government is 'at war with itself'. The debt market is concerned about continuing to fund state-owned enterprises, after Ramaphosa announced more front-end loaded support for Eskom in his State of the Nation address. Inflation rose to 4.5% in May, but the SARB's forecasting model suggests there is room for interest rate cuts. The IHS Markit US manufacturing purchasing managers index (PMI) declined to 50.1, its lowest level since September 2009, and consumer confidence is at two-year lows. The Fed cut its inflation forecast and suggested a rate cut could happen as early as July unless trade tensions and economic data improve. The 10-year Treasury note yield fell below 2% as US rates markets moved to price in roughly three rate cuts from the Federal Open Market Committee (FOMC) in 2019. This aggressive move is normally only associated with an economic recession, but the Fed is changing the reaction function that will encourage an inflation overshoot.
Eurozone inflation expectations plunged to a record low (1.1% on the five-year forward rate) as investors worry that the economy is slipping into 'Japanification', an inescapable period of stagnant growth and low interest rates. Unsatisfied with the market's view, Mario Draghi, President of the ECB, announced possible interest rates cuts and a fresh round of bond purchases. The TLTRO-III stimulus programme will start in September, and tax cuts have been announced in some of the major economies.
After three years of political deadlock over Brexit, the ruling Conservative Party is picking a new leader. Boris Johnson is the favourite to succeed Prime Minister Theresa May, and the new prime minister should be in place by the end of July. Johnson vowed to deliver Brexit with or without a deal. Brussels has underlined that it will not reopen Britain's EU withdrawal deal, stressing that the next prime minister should honour the deal that Theresa May brokered.
China's central bank added 500 billion yuan ($72 billion) to the financial system, the second-largest injection on record. The financial support was required after the government's first seizure of a bank in more than two decades drove up funding costs. The Chinese services sector is holding up well despite a slowing manufacturing sector (Chinese factory output slowed to its weakest pace on record), and infrastructure investment is being encouraged in order to ensure growth does not slow beyond the government's 'reasonable range'.
India's central bank cut its benchmark interest rate for the third time this year, to 5.75%, the lowest level in nine years, and signalled the possibility of further easing in a bid to support growth. However, the central bank suffered a blow to its credibility after the resignation of deputy governor Viral Acharya.
Russia's central bank cut the key interest rate and hinted at future reductions. Australia's central bank cut interest rates to a record low of 1.25%.
Fitch and Moody downgraded Mexico's credit rating against the backdrop of rising trade tensions. Fortunately, President Trump 'indefinitely suspended' his plans for U.S. tariffs on Mexico, removing the threat of a 5% tariff on Mexican imports.
Turkey's opposition party, the Republican People's Party, secured 54.2% of the vote in a re-run Istanbul mayoral election, striking a blow to President Tayyip Erdogan.
FUND PERFORMANCE
In June the ECB announced a pushing back of its first rate hike post the 2011 euro debt crisis until at least mid-2020, citing continued geopolitical uncertainties, protectionism threats and vulnerabilities in emerging markets. ECB President Mario Draghi offered to pay banks to borrow cash from the central bank and pass it on to households and firms. Meanwhile, the Fed held its rates steady while leaving the door slightly open to future rate cuts (with equal votes favouring one cut this year versus maintaining the status quo, and one outlier vote wanting a hike). The Fed Chairman, Jerome Powell, indicated that some officials believe the case for accommodation has strengthened.
In South Africa, President Ramaphosa delivered his SONA, acknowledging soft growth prospects for this year following a dismal Q1 GDP. He reaffirmed the SARB’s constitutional mandate to protect the value of our currency in the interest of balanced and sustainable growth. These factors strengthen the likelihood that the SARB will cut interest rates in its upcoming meetings, which should provide a positive boost for business confidence.
The Fund strategy continues to soundly navigate these volatile markets, accessing attractive yields and protecting investor capital through the cycles.
  • Fund focus and objective  
The Sygnia Enhanced Income Fund is multi-asset portfolio that invests in a wide spread of investments in the equity, bond, money market and real estate markets with the primary objective of maximising return at a low level of risk. The effective equity exposure (including foreign equities) will always be below 10%. The Portfolio will not exceed exposure to listed property of 25%. The portfolio may also invest in listed and unlisted financial instruments, including derivatives, in accordance with the provisions of the Collective Investment Schemes Control Act and applicable legislation, as amended from time to time, in order to achieve the portfolio's investment objective.
Apart from the above, the portfolio may will also invest in participatory interests in portfolios of collective investment schemes registered in the Republic of South Africa or of participatory interest in collective investment schemes or other similar schemes operated in territories with a regulatory environment which is to the satisfaction of the manager and the trustee of a sufficient standard to provide for investor protection which is at least equivalent to that in South Africa.
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