The Fairtree Bond Prescient Fund will aim to deliver a return in excess of the FTSE/JSE All Bond Index, after fees, over the long term, which comprises a reasonable level of income, as well as capital performance relative to the benchmark. The portfolio will invest in interest bearing and non-equity securities (including, but not limited to, government or quasi-government bonds, corporate bonds, cash deposits, money market and other interest-bearing securities), as well as listed and unlisted financial instruments in line with appropriate regulations. The investments are actively managed and will change over time to reflect a macro fundamental outlook including the interest rate cycle, business cycle, default cycle, as well as other cyclical and credit factors. The portfolio will make active duration decisions that reflect the outlook for the level and shape of the bond yield curve and opportunities in credit markets. The portfolio will predominately invest in South African markets, but is however permitted to include investments in offshore jurisdictions subject to prevailing regulations.
The portfolio will be subject to the Prudential Investment Guidelines for South African Retirement Funds, being Regulation 28 of the Pension Funds Act, or such other legislation published from time to time.
The portfolio may, apart from assets in liquid form, also include participatory interests, exchange traded funds or any other form of participation in portfolios of collective investment schemes or other similar schemes. Where the aforementioned schemes are operated in territories other than in South Africa, participatory interests or any other form of participation in these schemes will be included in the portfolio only where the regulatory environment is to the satisfaction of the manager and trustee and is of a sufficient standard to provide investor protection at least equivalent to that in South Africa.
Nothing in the supplemental deed shall preclude the manager from varying the ratios of securities, to maximise capital growth and investment potential in changing economic environments or market conditions or to meet the requirements, if applicable, of any exchange formally recognised in terms of legislation and from retaining cash or placing cash on deposit in terms of the Deed and any Supplemental Deeds thereto; provided that the manager shall ensure that the aggregate value of the assets comprising the portfolio shall consist of securities of the aggregate value required from time to time by the Act.
The Trustee shall ensure that the investment policy set out in the supplemental deed, the Deed and in all Supplemental Deeds thereto is carried out.
For the purpose of this portfolio, the manager in consultation with the investment manager shall reserve the right to close the portfolio to new investors on a date determined by the manager. This will be done in order to be able to manage the portfolio in accordance with its mandate. The manager may, once a portfolio has been closed, open that portfolio again to new investors on a date determined by the manager.