Foord Balanced Fund
For long-term investors in South African retirement fund products
INVESTMENT OBJECTIVE
Managed to comply with the statutory investment limits set for retirement funds in South Africa, the fund aims to grow retirement savings by meaningful, inflation-beating returns over the long term.
FOR SOUTH AFRICAN INVESTORS
• With a moderate risk profile
• Seeking long-term, inflation-beating returns
• Over periods exceeding five years
• From a South African retirement fund investment product (Reg 28).
| Year | Fund Return % | Benchmark Return % | SA Inflation % |
|---|---|---|---|
| 2002 (from 01/Sep) | 6.1 | 0.7 | 3.1 |
| 2003 | 15.3 | 16.1 | 0.3 |
| 2004 | 23.8 | 25.5 | 3.4 |
| 2005 | 45.8 | 30.6 | 3.6 |
| 2006 | 35.9 | 26.2 | 5.9 |
| 2007 | 12.1 | 12.5 | 8.9 |
| 2008 | -5.9 | -5.6 | 9.5 |
| 2009 | 18.0 | 17.7 | 6.3 |
| 2010 | 17.2 | 10.8 | 3.5 |
| 2011 | 10.9 | 6.0 | 6.1 |
| 2012 | 24.4 | 14.9 | 5.7 |
| 2013 | 24.2 | 21.2 | 5.4 |
| 2014 | 11.0 | 8.9 | 5.3 |
| 2015 | 10.5 | 8.0 | 5.2 |
| 2016 | 0.4 | 1.7 | 6.8 |
| 2017 | 8.0 | 11.6 | 4.7 |
| 2018 | -3.1 | -4.5 | 4.5 |
| 2019 | 12.2 | 8.7 | 4.0 |
| 2020 (to 30/Sep) | 5.6 | -0.9 | 2.6 |
| Benchmark |
The market value weighted average total return of the South African – Multi-Asset – High Equity unit trust sector, excluding Foord Balanced Fund. |
| Time horizon |
Longer than five years. |
| Inception date |
1 September 2002 |
| Minimum investment |
R50 000 lump sum or R1 000 per month |
| Significant restrictions |
Maximum equity exposure of 75%: maximum offshore exposure of 30%; complies with pension fund investment regulations (Regulation 28). |
| Income distributions |
End-February and end-August each year. |
| Income characteristics |
Medium yield, approximately double that of a general equity fund. Income distributions are reduced by the annual service charge, which varies with the relative performance of the fund against its benchmark. |
| Portfolio orientation |
Medium to high weighting in JSE shares and includes exposure to listed property, commodity securities, bonds, money market instruments and foreign assets. |
| Foreign assets |
Foreign asset exposure is obtained predominantly via Foord International Fund (FIF) and Foord Global Equity Fund Luxembourg (FGEFL), sub-funds of Foord SICAV domiciled in Luxembourg and Foord Global Equity Fund (FGEF) domiciled in Singapore. FIF is a conservative, multi-asset class fund. FGEF and FGEL comprise portfolios of global shares and cash. All funds are priced in US dollars. |
| Risk of loss |
Lower than that of a pure equity fund. High in periods shorter than six months, lower in periods greater than one year. |
| Security description | Asset class | Market | Portfolio weight % |
|---|---|---|---|
| Foord Global Equity Fund | Foreign assets | LU/SG | 21.1 |
| Foord International Fund | Foreign assets | LU | 14.5 |
| RSA 10.5% (R186) | Gov bonds | ZA | 12.0 |
| NewGold | Commodity | ZA | 4.8 |
| BHP Group | Equity | ZA | 4.4 |
| Naspers "N" | Equity | ZA | 3.8 |
| Anheuser-Busch | Equity | ZA | 3.1 |
| Aspen | Equity | ZA | 3.0 |
| CF Richemont | Equity | ZA | 2.8 |
| FirstRand | Equity | ZA | 2.7 |
Monthly Commentary – September 2020
- Global equities (-3.2% in US dollars) fell for the first time in six months, weighed down by benchmark-heavy tech stocks—on worries that high unemployment levels and expiring stimulus measures could weigh on growth
- Global developed market sovereign bond yields fell modestly—at its mid-month meeting the US Federal Reserve signalled continued dovishness with no rate hikes expected until 2023
- The US dollar strengthened against most majors, weighing on emerging markets and commodities—gold (-4.1%) retraced some of its recent gains and oil (-9.6%) tumbled on lower demand
- The FTSE/JSE Capped All Share Index (-1.2% in rands) was led lower by resources stocks (-3.4%) on lower prices while financial counters (+2.3%) rallied from oversold levels—investments in FirstRand (+9.0%), British American Tobacco (+5.4%) and Spar Group (+17.3%) contributed to returns while Aspen (-12.1%) and brewer Anheuser-Busch Inbev (-7.8%) detracted
- The All Bond Index was unchanged, but SA listed property stocks (-3.0%) fell again—the fund’s large holding in the mid-duration R186 bond (+1.5%) again outperformed the ALBI but UK property counter Capco (-12.8%) was a big detractor
- The rand (+1.1% vs the US dollar) gained materially against the dollar but lost ground latterly on risk off sentiment as fears of renewed European COVID-19 lockdowns mounted—foreign assets (-5.5%) were the biggest detractors from performance in the month
The fee is a performance based fee that varies around the at-benchmark fee rate as disclosed on the fact sheet. The daily fee rate is adjusted up or down based on the portfolio’s one-year rolling return relative to that of its benchmark. Minimum fee rates apply. Fees accrue in the Foord global funds as disclosed.
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