Foord Conservative Fund
For conservative, medium-term investors in South African retirement fund products
Managed to comply with the statutory investment limits set for retirement funds in South Africa, the fund aims to provide conservative, medium-term investors with inflation-beating returns over rolling three-year periods.
FOR SOUTH AFRICAN INVESTORS
• With a conservative risk profile
• Close to or in retirement
• Seeking medium-term, inflation-beating returns
• Over time horizons of less than five years.
• From a South African retirement fund investment product (Reg 28).
|Year||Fund Return %||Benchmark Return %||SA Inflation %|
|2022 (to 30/Apr)||-1.1||3.1||1.9|
CPI +4% per annum, which is applied daily using the most recently available inflation data and accordingly will be lagged on average by five to six weeks.
Shorter than five years.
2 January 2014
R50 000 lump sum or R1 000 per month
Maximum equity exposure of 60%: maximum offshore exposure of 45%; complies with pension fund investment regulations (Regulation 28).
End-March and end-September each year.
Typically more than double that of the FTSE/JSE All Share Index dividend yield. The income yield is affected by the level of performance fees accrued.
Typically a medium to low weighting in JSE shares and includes exposure to listed property, commodity securities, bonds, money market instruments and foreign assets.
Foreign asset exposure is obtained predominantly via Foord International Fund (a conservative, multi-asset class fund), sub-fund of Foord SICAV domiciled in Luxembourg and Foord Global Equity Fund (a portfolio of global shares and cash), domiciled in Singapore. Both funds are priced in US dollars.
|Risk of loss||
Medium in periods shorter than six months. Low in periods greater than one year.
|Security description||Asset class||Market||Portfolio weight %|
|Foord International Fund||Foreign assets||LU||18.5|
|RSA 10.5% (R186)||Gov bonds||ZA||13.6|
|Foord Global Equity Fund||Foreign assets||SG||13.0|
|RSA 8.0% (R2030)||Gov bonds||ZA||4.2|
|RSA 8.875% (R2035)||Gov bonds||ZA||3.8|
|RSA 8.25% (R2032)||Gov bonds||ZA||3.6|
Monthly Commentary – April 2022
- Global equities (-8.0% in US dollars) fell on US Federal Reserve comments suggesting larger than expected interest rate increases in the months ahead — protracted hostilities between Russia/Ukraine and the economic ramifications of widespread COVID-19 lockdowns in China also spooked global bourses
- Oil (+1.3%) was marginally up but volatile intramonth and is +31% higher since the beginning of the year on supply concerns while industrial commodities were broadly weaker on growing economic slowdown fears — gold (-2.0%) fell on weaker expected Chinese jewellery demand but the physical gold ETF investment contributed positively on the much weaker rand
- Bond market investors (-5.6%) incurred losses as developed market bond yields rose — the US 10 year treasury yield shifted up meaningfully on steep inflation prints and the increasingly hawkish Fed comments
- The FTSE/JSE Capped All Share Index (-3.6% in rands) fell on broad-based weakness with resources (-4.8%), industrials (-1.7%) and financials (-5.5%) in negative territory — investments in Omnia (+10.9%) and British American Tobacco (+7.7%) contributed positively while Naspers (-3.3%) and Aspen (-14.4%) detracted
- The All Bond Index (-1.7%) moved lower as the yield curve steepened on rising inflation expectations and net foreign selling — the core R186 holding (-0.1%) in the 3 to 7-year bucket outperformed as longer dated maturities underperformed
- SA listed property (-1.4%) fell on economic growth concerns as rising inflation and interest rates present headwinds to consumers — new investment in Fortress A (+0.1%) contributed positively while Capital & Counties (-2.4%) detracted despite rand weakness
- The rand (-8.1% vs the US dollar) sharply retraced some of its recent gains in line with other ermerging market commodity exporters and broad based US dollar strength — the currency is vulnerable to a reversal in the commodity export-driven terms of trade support
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, but no fees are levied when the annual net return falls below zero. Fees accrue in the Foord global funds as disclosed.
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