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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 30/Sep) 6.0 8.2 4.5

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-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.

Top 10
Security description Asset class Market Portfolio weight %
Aspen Equity ZA 5.1
RSA 10.5% (R186) Gov bonds ZA 4.8
Naspers "N" Equity ZA 4.2
RSA 8.0% (R2030) Gov bonds ZA 4.0
NewGold Commodity ZA 3.5
Anheuser-Busch Equity ZA 2.9
Alphabet Inc Equity US 2.8
FirstRand Equity ZA 2.8
Prosus "N" Equity ZA 2.6
BHP Group Equity ZA 2.5
Commentary

Monthly Commentary – September 2021

  • Global equities (-4.1%) fell after seven straight months of gains—slowing global economic growth amid growing uncertainties around new COVID-19 variants, Evergrande contagion, energy supply issues in Europe and China, and global supply chain difficulties giving rise to higher inflation all dampened enthusiasm
  • Developed market bond yields rose on worries that rising global inflation may not be as transitory as first believed—while Chairman Powell continues to walk a fine monetary policy line, it is becoming increasingly probable the US Fed will begin its bond tapering program within the next two months and we continue to expect a lift-off in rates sometime in 2022
  • Industrial commodities iron ore (-24.9%) and copper (-6.2%) fell on concerns of a slowdown in Chinese economic growth compounded by Chinese power supply constraints as oil (+7.6%), gas (+87.5%) and coal (+53.4%) rose sharply as alternatives—precious metals platinum (-4.8%), palladium (-22.6%), silver (-10.5%) and gold (-3.3%) moved lower on US dollar strength, with palladium impacted by continued auto production problems
  • Foreign assets (-0.3% in rands) detracted marginally as the fall in global equities was offset by the weakening currency—the US S&P 500 market index hedges provided some protection while resources stocks such as Freeport McMoran (-10.6% in dollars) and the fund’s Chinese holdings detracted
  • The FTSE/JSE Capped All Share Index (-3.1% in rands) was dragged lower by the resources sector (-9.3%) and industrials (-0.8%) with financials (+1.7%) pulled up by select banks and life insurance companies—healthcare company Aspen (+39.5%) contributed meaningfully as the company continued to re-rate from an oversold position
  • The All Bond Index (-2.1%) fell as yields across the curve moved higher in line with rising global bond yields—the core holding in the short and medium-term sector (-0.6%) outperformed as longer dated maturities suffered steeper losses
  • The rand (-3.8% vs the US dollar) weakened on broad-based dollar strength and negative emerging market sentiment with investors now more actively positioning for a moderation of the prevailing accommodative US monetary policy and the subsequent rise in interest rates—the currency remains vulnerable as the short-term platinum group metals price terms of trade bonus starts to dissipate
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.

WHAT IF YOU HAD INVESTED WITH US IN THE PAST?


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

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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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