This website uses cookies. Read more. Okay

Foord Conservative Fund

For conservative, medium-term investors in South African retirement fund products

INVEST NOW

INVESTMENT OBJECTIVE

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).

Performance

Returns
Year Fund Return % Benchmark Return % SA Inflation %
2014 9.6 9.3 5.3
2015 10.4 9.2 5.2
2016 1.4 10.8 6.8
2017 8.1 8.7 4.7
2018 1.8 8.5 4.5
2019 13.8 8.0 4.0
2020 10.5 7.1 3.1

Characteristics
Benchmark

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.

Time horizon

Shorter than five years.

Inception date

2 January 2014

Minimum investment

R50 000 lump sum or R1 000 per month

Significant restrictions

Maximum equity exposure of 60%: maximum offshore exposure of 30%; complies with pension fund investment regulations (Regulation 28).

Income distributions

End-February and end-August each year.

Income characteristics

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.

Portfolio orientation

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 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.

Top 10
Security description Asset class Market Portfolio weight %
Foord International Fund Foreign assets LU 14.4
Foord Global Equity Fund Foreign assets SG 14.0
RSA 10.5% (R186) Gov bonds ZA 6.6
RSA 8.875% (R2035) Gov bonds ZA 4.0
NewGold Commodity ZA 3.4
Naspers "N" Equity ZA 3.2
Anheuser-Busch Equity ZA 2.5
BHP Group Equity ZA 2.4
Aspen Equity ZA 2.2
RSA 8.0% (R2030) Gov bonds ZA 2.1
Commentary

Monthly Commentary – December 2020

  • Global equities (+4.2% in US dollars) again reached new highs on the first COVID-19 vaccine approvals by US, UK, and EU regulators and the passage in the US of a $900 billion pandemic relief bill—emerging markets (+7.2%) outperformed on the improving global economic sentiment
  • European sovereign bond yields trended lower on reaccelerating COVID-19 infections and US yields edged higher on a modest improvement in US employment and COVID-19 vaccine approvals—the US dollar continued to weaken against most major and emerging market currencies
  • Industrial commodities including oil (+8.9%), copper (+2.7%) and iron ore (+25.1%) rose on expectations that COVID-19 vaccines may result in higher global growth in 2021—precious metals gold (+6.6%) and silver (19.6%) rebounded after three months of retreat
  • The FTSE/JSE Capped All Share Index (+4.9% in rands) was buoyed by the positive global emerging markets sentiment and net foreign buying—resources (+9.5%) and financials (+8.3%) advanced while industrials (-1.0%) lagged
  • The fund’s JSE equity investments underperformed given the low allocation to listed property (+13.7%) and the resources sector although core holding BHP Group (+9.6%) contributed meaningfully—the investment in FirstRand (+12.2%) was positive while the allocation to large cap rand hedges Anheuser-Busch InBev (-0.1%), Richemont (+1.0%) and British American Tobacco (+2.1%) underperformed on rand strength
  • The All Bond Index (+2.4%) advanced as positive emerging markets sentiment resulted in lower long bond yields and a flatter yield curve—the fund’s core investment in the 3-7-year sector (+2.5%) again contributed meaningfully to returns and is still the managers’ preferred yield curve position
  • The rand (+5.0% vs the US dollar) gained on broad-based dollar weakness and positive emerging markets sentiment on COVID-19 vaccine news and expectations for accelerating global economic growth in 2021—despite recent dollar weakness, the rand (-5.0%) is weaker over 2020 and remains vulnerable over the longer term
Fees

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.

WHAT IF YOU HAD INVESTED WITH US IN THE PAST?


Experience the compounding phenomenon of a sustained, long-term investment with Foord.

Calculate
Currency
Using rand returns of Foord’s best investment view South African funds. ? In calculating the current value of your hypothetical investment, we have applied the returns of Foord Asset Management’s retirement fund track record from 1 January 1990 to 31 March 2008 (gross of fees) combined with the net returns of the Foord Flexible Fund of Funds from 1 April 2008. Any information provided is not intended nor does it constitute financial, tax, legal, investment, or other type of advice, and the suitability or potential value of any information or particular investment source is not guaranteed. Performance may be affected by changes in the market or economic conditions and legal, regulatory and tax requirements. Distributions may be subject to mandatory withholding taxes. Foord does not provide any guarantee either with respect to the capital or the performance return of investments.
Using US dollar returns of Foord’s best investment view global fund. ? In calculating the current value of your investment, we have applied the long-term returns of the Foord International Trust. These returns are calculated net of fees. Past performance is no guarantee of future performance. Foord Asset Management (Singapore) Pte. Limited disclaims any liability for any loss, liability, or damages (whether direct or consequential) of any nature whatsoever that may be suffered as a result of, or which may be attributable, directly or indirectly to the use of or reliance upon the information provided.
Value Today: R0
Annualised Return: 0%
The annualised return is the effective annual percentage return achieved over the term of the investment. Results for an investment term of less than one year should be treated with caution.

Insights

21 Jan 2021

The cupboard is now bare

It is difficult to remember the heady days of the 2010 Soccer World Cup and the general sense of national euphoria and ‘gees’ we experienced. Business development manager Nick Curtin writes how the national mood is…

Read more

14 Jan 2021

Year in review

We will remember 2020 as the year COVID-19 dramatically impacted our lives. Portfolio manager Mike Townshend looks at the year that was.

Read more
newsletter subscription