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Foord Flexible Fund of Funds

For unconstrained investors seeking long-term inflation-beating returns

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INVESTMENT OBJECTIVE

Exploiting the benefits of global diversification, the fund aims to provide investors with an after-fee return of 5% per annum above SA inflation.

FOR SOUTH AFRICAN INVESTORS

•    With a moderate risk profile
•    Seeking long-term inflation-beating returns over periods exceeding five years
•    Requiring balanced exposure to South African and global investments.

Performance

Returns
Year Fund Return % Benchmark Return % SA Inflation %
2008 (from 01/Apr) -8.5 9.1 5.4
2009 15.1 11.3 6.3
2010 19.7 8.5 3.5
2011 16.7 11.1 6.1
2012 29.9 10.7 5.7
2013 40.7 10.4 5.4
2014 9.3 10.3 5.3
2015 21.9 10.2 5.2
2016 -3.7 11.8 6.8
2017 5.4 9.7 4.7
2018 -1.2 9.5 4.5
2019 13.7 9.0 4.0
2020 16.4 8.1 3.1
2021 (to 31/Mar) 3.7 2.6 1.4

Characteristics
Benchmark

CPI +5% per annum, which is applied daily using the most recently available inflation data and accordingly will be lagged on average by 5 to 6 weeks

Time horizon

Longer than five years.

Inception date

1 April 2008

Minimum investment

R50 000 lump sum or R1 000 per month

Significant restrictions

None. The fund is unconstrained.

Income distributions

End-February and end-August each year.

Income characteristics

Low to medium income yield depending on the asset allocation strategy employed as the foreign asset component is invested in roll-up funds which do not distribute their income. Income distributions are reduced by the annual service charge, which varies with the relative performance of the fund against the benchmark.

Portfolio orientation

Exploiting the benefits of global diversification, the portfolio continually reflects Foord’s prevailing best investment view on all available asset classes in South Africa and around the world.

Foreign assets

Foreign asset exposure is obtained predominantly via Foord International Fund (a conservative, multi-asset class fund) and Foord Global Equity Fund Luxembourg (a portfolio of global shares and cash). Both funds are sub-funds of Foord SICAV domiciled in Luxembourg and are priced in US dollars.

Risk of loss

Lower than that of a pure equity fund. High in periods shorter that six months, lower in periods greater than one year.

Top 10
Security description Asset class Market Portfolio weight %
RSA 10.5% (R186) Gov bonds ZA 5.5
RSA 8.0% (R2030) Gov bonds ZA 4.1
NewGold Commodity ZA 3.3
Anheuser-Busch Equity ZA 3.0
Aspen Equity ZA 2.9
BHP Group Equity ZA 2.8
Naspers "N" Equity ZA 2.8
Alphabet Inc Equity US 2.7
RSA 9.0% (R2040) Gov bonds ZA 2.5
Extended Stay America Inc Equity US 1.9
Commentary

Monthly Commentary – March 2021

  • Global equities (+2.7% in US dollars) rose on expectations for accelerating global growth following vaccine rollouts, further stimulus measures and ongoing accommodative monetary policy—developed market equities (+3.3%) outperformed while the emergence of more virulent COVID-19 strains weighed on emerging markets (-1.5%)
  • Developed market bond yields rose again on higher inflation expectations—even as the US Federal Reserve downplayed inflation risks and reiterated its commitment to accommodative policy until unemployment and inflation exceeded its targets
  • Within the global funds, US agriculture company FMC (+9.2%), retail pharmacy chain CVS (+10.4%), Scottish energy multi-national SSE (+9.9%), Chinese insurer PICC P&C (+14.8%) and US hospitality play Extended Stay (+23.4%) contributed the most to fund performance—Wharf Real Estate (-4.6%) and US miner Freeport McMoran (-2.9%) detracted while investment in Chinese tech names and the S&P hedges were the biggest detractors this month
  • The FTSE/JSE Capped All Share Index (+2.0% in rands) rose on broad-based strength—industrials (+1.9%), financials (+1.7%) and resources (+1.2%) all posted positive returns after Q4 2020 economic growth surprised and on expectations for robust economic growth this year
  • The fund’s SA equities gained, with Anheuser-Busch InBev (+6.4%), The Foschini Group (+17.0%), Spurcorp (+17.4%) and FirstRand (+4.9%) contributing most—partially offset by BHP Group (-7.4%) and the NewGold ETF (-4.2%) on the stronger rand and weaker commodity prices
  • The All Bond Index (-2.5%) declined with the yield curve steepening as longer maturity bond yields followed US Treasury yields higher—the SA listed property sector (+1.2%) rose with fund staple Capital & Counties (-4.2%) retracing after its rapid rise (+26.1%) last month
  • The rand (+2.3% vs the US dollar) bucked emerging market currency weakness as Q4 2020 GDP growth surprised—the lack of competitiveness and strained public finances continue to make the currency vulnerable over the longer term
  • Global equities (+2.7% in US dollars) rose on expectations for accelerating global growth following vaccine rollouts, further stimulus measures and ongoing accommodative monetary policy—developed market equities (+3.3%) outperformed while the emergence of more virulent COVID-19 strains weighed on emerging markets (-1.5%)
  • Developed market bond yields rose again on higher inflation expectations—even as the US Federal Reserve downplayed inflation risks and reiterated its commitment to accommodative policy until unemployment and inflation exceeded its targets
  • US agriculture company FMC (+9.2%), retail pharmacy chain CVS (+10.4%), Scottish energy multi-national SSE (+9.9%), Chinese insurer PICC P&C (+14.8%) and US hospitality play Extended Stay (+23.4%) contributed the most to fund performance—Wharf Real Estate (-4.6%) and US miner Freeport McMoran (-2.9%) detracted while investment in Chinese tech names and the S&P hedges were the biggest detractors this month
  • The FTSE/JSE Capped All Share Index (+2.0% in rands) rose on broad-based strength—industrials (+2.3%), financials (+1.6%) and resources (+2.0%) all posted positive returns after Q4 2020 economic growth surprised and on expectations for robust economic growth this year
  • The fund’s SA equities gained, with Anheuser-Busch InBev (+6.4%), The Foschini Group (+17.0%), Spurcorp (+17.4%) and FirstRand (+4.9%) contributing most—partially offset by BHP Group (-7.4%) and the NewGold ETF (-4.2%) on the stronger rand and weaker commodity prices
  • The All Bond Index (-2.5%) declined with the yield curve steepening as longer maturity bond yields followed US Treasury yields higher—the SA listed property sector (+1.2%) rose with fund staple Capital & Counties (-4.2%) retracing after its rapid rise (+26.1%) last month
  • The rand (+2.3% vs the US dollar) bucked emerging market currency weakness as Q4 2020 GDP growth surprised—the lack of competitiveness and strained public finances continue to make the currency 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.

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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.

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