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-21.66  /  -0.55%

3919.75

NAV on 2019/07/19
NAV on 2019/07/18 3941.41
52 week high on 2018/09/05 4226.7
52 week low on 2018/12/24 3250.23
Total Expense Ratio on 2019/03/31 0.86
Total Expense Ratio (performance fee) on 2019/03/31 0
NAV Incl Dividends
1 month change -1.99% -1.56%
3 month change 1.77% 2.22%
6 month change 13.4% 13.9%
1 year change 11.33% 12.35%
5 year change 14.41% 15.73%
10 year change 18.56% 19.68%
Price data is updated once a day.
  • Sectoral allocations
Offshore 5099.93 100.00%
  • Top five holdings
APPLE 184.85 3.62%
MICROSOFT 175.86 3.45%
AMAZON.COM 151.54 2.97%
FACEBOOKINC 81.66 1.6%
JOHNSON&JOHN 76.79 1.51%
  • Performance against peers
  • Fund data  
Management company:
Sygnia Collective Investments RF (Pty) Ltd
Formation date:
2008/04/01
ISIN code:
ZAE000249546
Short name:
U-DBTRUSA
Risk:
Unknown
Sector:
Regional--Equity--General
Benchmark:
MSCI USA index
Contact details

Email
info@sygnia.co.za

Website
www.SYGNIA.co.za

Telephone
021-446-4940

  • Fund management  
db x-trackers (Proprietary) Ltd.


  • Fund manager's comment

Sygnia Itrix MSCI US ETF - Comment Mar 19

2019/06/07 00:00:00
FUND PERFORMANCE
Markets were driven higher over the first quarter thanks to improved support from central banks and governments despite the downward trajectory of economic growth. China has surprised to the upside with fiscal stimulus, while the Fed has stopped raising interest rates, reduced quantitative tightening and shifted its monetary policy towards an average inflation target. The ECB announced another round of quantitative easing, and emerging-market central banks are able to accommodate lower interest rates due to stronger currencies. The recovery in risky assets year-to-date reflects expectations of economic green shoots in the second half of the year thanks to this additional liquidity; however, bond markets are disagreeing with this view and are extrapolating current disappointing growth to the second half of the year. The US yield curve inverted, suggesting a recession is imminent, while the German 10- year Bund yield went negative for the first time in three years. Meanwhile, emerging market currencies are pricing another crisis, following the Turkish Lira's plunge.
Real gross fixed capital formation contracted for the fourth consecutive quarter in 2018 across all sectors which bodes poorly for future growth. The RMB/BER business confidence index (BCI) plunged to levels last seen during 2009's global recession. Confidence was further weakened as President Ramaphosa confirmed that the ANC will nationalise the South African Reserve Bank. Meanwhile, NERSA's tariff increases, the lack of tax relief in the budget, higher oil prices, and renewed stage four load shedding have all contributed to low consumer confidence. CPI remained lacklustre at 4.1% in March and the SARB kept rates on hold. Despite the higher tariffs, Eskom's liquidity position remains dire and it is the biggest risk to SA's economic growth and credit rating, although Moody's kept South Africa's rating outlook unchanged at stable. On the stock front, Aspen fell over 50% intraday after disappointing results with spiralling debt the main concern.
The Fed delivered a significantly more dovish outcome at its March meeting than expected, with the committee downgrading growth and inflation projections in line with recent data. US employment showed only slight growth, manufacturing slowed more than expected and consumer confidence dropped well below expectations. US consumer prices experienced the smallest increase in nearly two-and-ahalf years. As a result, the Fed effectively called an end to its hiking cycle with no hikes forecast this year. In addition, the committee announced that quantitative tightening will be lowered in May before being halted completely in October, effectively ending US quantitative tightening. The Fed is also willing to tolerate an overshoot of their inflation goal. However, despite this, the gap between the three-month treasury bill rate and the benchmark 10-year yield inverted for the first time since 2007. An inversion of that portion of the yield curve is seen as a reliable warning of a potential recession within the next year or two. The US trade deficit reached a 10-year high in 2018 on record imports from China, which continues to highlight the risks of the trade talks which are set to continue into April.
March's Eurozone manufacturing index fell to a near six-year low and investor confidence remained negative for the fourth consecutive month. The ECB downgraded growth and inflation forecasts and in recognition of the poor outlook, announced dovish policy changes. Rates are now expected to stay unchanged throughout 2019 and a third series of quarterly targeted longer-term refinancing operations (TLTRO-III) will be implemented.
Theresa May put forward a stripped-down version of her twice-defeated Brexit divorce deal to a vote in parliament, however, lawmakers rejected May's Brexit deal for a third time. May had announced she would resign if her deal went through. As a result, the EU's extension of the Article 50 period will only run until 12th April. Britain now needs to convince the EU it has an alternative path or exit without a deal, and the UK parliament's indicative votes process is set to start on the 1st of April.
The composite PMI rose to 53.8 indicating acceleration in activity. However, geopolitics remains a concern as tensions increased between India and Pakistan over the disputed Kashmir region, after an Indian MiG-21 fighter jet crashed near Pakistan. The pilot, who had safely ejected before the crash, was later paraded on Pakistani television. India heads for national elections in April.
Turkey entered its first recession in a decade at the end of last year and the Turkish central bank's net reserves slid $6.3 billion in the first two weeks of March to $28.5 billion, raising speculation that it was intervening to support the currency. As a result, the Lira sold off and the cost to borrow liras overnight rose above 1000% as Turkey's government attempted to support the currency. The Turkish lira fell after President Erdogan's ruling party lost control of key cities during the local elections on the 31st of March.
Core Machine Orders fell -5.4%, far below expectations, while output at Japanese manufacturers fell at the fastest pace in almost three years. The Bank of Japan held its monetary policy steady and predicted the economy is likely to continue its current moderate expansion.
China's industrial production grew at the slowest pace in nearly two decades in the first two months of the year and China's exports tumbled 20%, the biggest fall in three years. China lowered its official goal for economic growth in 2019 to a range of 6 - 6.5%, however, it announced several growth supportive measures, including US$298.31 billion in tax cuts. In addition, China said it will invest 800 billion yuan in railway construction and 1.8 trillion yuan to build roads and waterway projects. Fiscal policy is increasing steadily, including local bonds to the general public deficit, the total is a massive 6.5% of GDP. Initial March data indicates domestic demand is improving on the back of policy support.
Oil prices hit their highest levels of 2019 after OPEC committed itself to further output cuts and sanctions on Venezuela and Iran reduced supply.
The Sygnia Itrix MSCI USA Index ETF delivered 12.9% for the quarter in Rand terms, in line with its benchmark, the MSCI USA Index. The Fund benefitted from exposure to Apple Inc, Microsoft Corp and Amazon.com Inc, while its exposure to AbbVie Inc, CVS Health Corp and Biogen Inc detracted from performance.
There were several changes to the tracked index’s constituents over the period, including the addition of KKR & Co Inc, Tableau Software Inc and Elanco Animal Health Inc, and the removal of PG&E Corp, SCANA Corp and Capri Holdings Ltd.
The Fund remains true to its investment objective of delivering returns that mirror those of the MSCI USA Index.
  • Fund focus and objective  
ETF - Local CIS with 100% investment in foreign equities as approved by the FSB
The investment policy of the portfolio shall be to track the Index as closely as possible.
The portfolio shall not buy or sell constituent securities, any other securities or financial instruments for the purpose of making a profit, nor for any purpose other than tracking the Index.
As a secondary objective, securities held by the portfolio from time to time may be utilised to generate income for the benefit of investors, provided that such activities do not conflict with the investment policy as stated in the clauses above.
Investors can obtain participatory interests in the portfolio by acquiring participatory interests on the secondary market or subscribing for participatory interests in the portfolio. In order to achieve this object the manager may, subject to the Act and the Deed create and issue an unlimited number of participatory interests in the portfolio.
The portfolio will not be managed according to traditional methods of active management, which involve the buying and selling of securities based on economic, financial and market analysis and investing judgment. Instead the investment objective and style will be full replication of the Index. As a result the financial or other condition of any company or entity included from time to time in the Index will not result in the elimination of its securities from the portfolio unless the securities of such company or entity are removed from the Index itself.
The portfolio shall also be entitled, in its discretion, to employ such investment strategies as will most effectively give effect to the investment policies of the portfolio.
The composition of the portfolio will be adjusted periodically to conform to changes in the composition and weighting of the securities in the Index so as to ensure that the composition and weighting of the scheme's portfolio are a reflection of the composition and weighting of the securities contained in the Index.
The portfolio will hold securities purely for the economic rights and benefits attaching thereto, and accordingly if a takeover bid is made for shares of a company included in the Index, the portfolio will not tender shares in respect thereof. Securities held by the portfolio which are subject to a takeover bid will only be surrendered if such surrender is mandatory (and then only to the extent of such mandatory surrender) in terms of applicable law or under the rules of a regulatory authority or body having jurisdiction. If a takeover bid results in a company no longer qualifying for inclusion in the Index, any shares of the company held by the portfolio after the takeover bid will be disposed of by the portfolio, and the proceeds will be applied in effecting the appropriate adjustments to the portfolio.
To the extent necessary for the purposes of achieving its investment policies, the portfolio may hold assets in liquid form. Any assets held in liquid form may be invested in short?term investments such as banker's acceptances and certificates of deposit.
The portfolio's ability to replicate the price and yield performance of the Index will be affected by the costs and expenses incurred by the portfolio.
Any material change in the investment policy of the portfolio shall constitute an amendment of the Deed, and shall be subject to the provisions of clause 65 of the Deed, in which event investors shall be given reasonable notice to enable them to redeem their participatory interest prior to implementation of the change.
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