Foord Flexible Fund of Funds
For unconstrained investors seeking long-term inflation-beating returns
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.
FUND MANAGERS
| 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 | 11.0 | 10.9 | 5.9 |
| 2022 (to 30/Apr) | -4.9 | 3.5 | 1.9 |
| 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-March and end-September 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. |
| Security description | Asset class | Market | Portfolio weight % |
|---|---|---|---|
| NewGold | Commodity | ZA | 4.4 |
| Distell | Equity | ZA | 4.0 |
| Naspers "N" | Equity | ZA | 3.8 |
| Spar Group | Equity | ZA | 3.6 |
| Aspen | Equity | ZA | 3.5 |
| Anheuser-Busch | Equity | ZA | 3.4 |
| FirstRand | Equity | ZA | 3.2 |
| Prosus "N" | Equity | ZA | 2.8 |
| BHP Group | Equity | ZA | 2.8 |
| Freeport-McMoran Inc | Equity | US | 2.4 |
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 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.
WHAT IF YOU HAD INVESTED WITH US IN THE PAST?
Experience the compounding phenomenon of a sustained, long-term investment with Foord.
Insights
25 May 2022
How does Foord manage risk in the Foord Flexible Fund?
Dave Foord discusses how diversification is used to manage risk in the Foord Flexible Fund.
25 May 2022
What hedging strategies are employed in the Foord Flexible Fund especially on currency risk?
Dave Foord discusses what hedging strategies are employed in the Foord Flexible Fund, especially on currency risk.