* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Download Sanlam Investment Management Small Cap Fund
Investor-state dispute settlement wikipedia , lookup
Syndicated loan wikipedia , lookup
Greeks (finance) wikipedia , lookup
Rate of return wikipedia , lookup
International investment agreement wikipedia , lookup
Systemic risk wikipedia , lookup
Corporate venture capital wikipedia , lookup
Public finance wikipedia , lookup
Private equity in the 2000s wikipedia , lookup
Mark-to-market accounting wikipedia , lookup
Private equity wikipedia , lookup
Fund governance wikipedia , lookup
Business valuation wikipedia , lookup
Beta (finance) wikipedia , lookup
Land banking wikipedia , lookup
Modified Dietz method wikipedia , lookup
Financialization wikipedia , lookup
Early history of private equity wikipedia , lookup
Private equity secondary market wikipedia , lookup
Financial economics wikipedia , lookup
Harry Markowitz wikipedia , lookup
Modern portfolio theory wikipedia , lookup
(Fund Fact Sheet) Sanlam Investment Management Small Cap Fund April 2017 Fund Objective This is a specialist equity fund which seeks to achieve maximum capital appreciation by investing in companies with small to mid - market capitalisations and who display the potential to deliver above average earnings growth. The fund may invest a maximum of 25% of assets offshore. The portfolio manager may borrow up to 10% of the market value of the portfolio to bridge insufficient liquidity. This fund is also available via certain LISPS (Linked Investment Service Providers), which levy their own fees. Fluctuations or movements in exchange rates may cause the value of underlying international investments to go up or down. Top 10 Holdings Securities Fund Strategy % of Portfolio Curro Holdings Limited 3.97 BowCalf 3.89 Astrapak 3.21 Advtech 2.97 Why choose this fund? NBS 2.92 *Small cap companies tend to outperform their large cap counterparts as a result of being able to grow their earnings faster, with higher volatility. *Due to a lack of research, there are many more undervalued and mispriced opportunities amongst small cap stocks. *Some growing/emerging industries only exist in the small cap arena. *Today’s small caps are the large caps of tomorrow. Raubex 2.76 Ascendis Health Ltd (ASC) 2.74 Adaptit Holdings Ltd 2.73 Rhodes Food Group Holdings Ltd 2.68 Dis-Chem Pharmacies Limited 2.66 Fund Information Top 10 Holdings as at 31 Mar 2017 This is an aggressive, actively managed fund focusing on small to mid cap companies with above average growth potential and which have been mispriced by the market. This portfolio may also invest in participatory interests of underlying unit trust portfolios. ASISA Fund Classification SA - Equity - Mid & Small Cap Risk profile Aggressive Benchmark Market Cap Weighted Index using, FTSE/JSE Mid Cap and FTSE/JSE Small Cap Indices Portfolio launch date 02 Jun 1997 3 year 6.73 9.71 Fee class launch date 01 Jul 2004 5 year 10.05 13.20 Minimum investment Lump sum: R10 000 | Monthly: R500 10 year 5.56 10.75 Portfolio size R559.5 million Annualised return is the weighted average compound growth rate over the period measured. Last two distributions 30 Jun 2016: 3.17 cents per unit 31 Dec 2016: 39.97 cents per unit Performance (Cumulative) as at 30 Apr 2017 on a rolling monthly basis Income decl. dates 30 Jun | 31 Dec Income price dates 1st working day in July and January Valuation time of fund 15:00 Transaction cut off time 15:00 Daily price information Local newspaper and www.sanlamunittrusts.co.za Repurchase period 3 working days Performance (Annualised) as at 30 Apr 2017 on a rolling monthly basis Retail Class 1 year Retail Class Fund (%) Benchmark (%) (0.50) 2.77 Fund (%) Benchmark (%) 1 year (0.50) 2.77 3 year 21.57 32.06 5 year 61.40 85.87 10 year 71.81 177.60 Cumulative return is aggregate return of the portfolio for a specified period Fees (Incl. VAT) Risk statistics: 3 years to 30 Apr 2017 Retail Class (%) Advice initial fee (max.) 3.42 Manager initial fee N/A Advice annual fee (max.) 1.14 Manager annual fee 1.71 Total Expense Ratio (TER) 1.75 Std Deviation (Ann) 7.89 Sharpe Ratio (Ann) 0.03 Actual highest and lowest annual returns* Highest Annual % 52.92 Lowest Annual % (39.11) Advice fee | Any advice fee is negotiable between the client and their financial advisor. An annual advice fee negotiated is paid via a repurchase of units from the investor. Obtain a personalised cost estimate before investing by visiting www.sanlamunittrustsmdd.co.za and using our Effective Annual Cost (EAC) calculator. Alternatively, contact us at 0860 100 266. Total Expense Ratio (TER) | PERIOD: 1 April 2014 to 31 March 2017 Total Expense Ratio (TER) | 1.75% of the value of the Financial Product was incurred as expenses relating to the administration of the Financial Product. A higher TER does not necessarily imply a poor return, nor does a low TER imply a good return. The current TER may not necessarily be an accurate indication of future TER’s. Transaction Cost (TC) | 0.34% of the value of the Financial Product was incurred as costs relating to the buying and selling of the assets underlying the Financial Product. Transaction Costs are a necessary cost in administering the Financial Product and impacts Financial Product returns. It should not be considered in isolation as returns may be impacted by many other factors over time including market returns, the type of Financial Product, the investment decisions of the investment manager and the TER. Total Investment Charges (TER + TC) | 2.09% of the value of the Financial Product was incurred as costs relating to the investment of the Financial Product. This monthly Minimum Disclosure Document should be viewed in conjunction with the Glossary Terms Sheet. Issue Date: 22 May 2017 Page 1 Looking back at the markets in the first quarter of 2017, the FTSE/JSE All Share Index (ALSI) gained 3.8% (all returns shown as total returns inclusive of dividends). The one-year return to 31 March 2017 for the ALSI still remains weak at 2.5%. This relatively benign All Share performance continues to mask the underlying volatility among the major sectors. For the quarter, Industrials posted a recovery, gaining 6.6% after a dismal 2016, to outperform Resources (+2.7%) and Financials (-1.1%). Property stocks gained 1.4% in the quarter. Asset Allocation Equity NSX Equities 2.68 Property International Assets 4.66 2.01 Equity Technology From a size perspective, the FTSE/JSE Top 40 Index gained 3.9% for the quarter, ahead of mid-caps (+1.1%) and small-caps (+4.5%). Over the one year to 31 March 2017, small-caps (+13.5%) and mid-caps (+8.0%) handsomely outperformed their large-cap peers (+0.7%). This divergence over one year can again broadly be attributed to the relative composition within the indices. Both the mid- and small-cap indices contained a number of high-flying resource stocks which skewed the performance of these broad indices. 7.14 Equity Financials 10.77 Equity Telecommunications 1.94 Equity Consumer Services 17.33 Equity Health Care 5.08 Equity Consumer Goods 5.29 Equity Industrials Portfolio review 25.38 Equity Basic Materials 9.60 Cash and Money Market Assets 8.12 00 05 10 15 20 25 30 Portfolio Manager(s) Quarterly Comment - 31 Mar 2017 Market review Early in April, the downgrade of our foreign currency debt rating by Standard & Poor’s (S&P) to junk status gave credence to the fears which surfaced following President Zuma’s recall of the finance minister from an overseas investor roadshow and the subsequent Cabinet reshuffle. Fitch followed suit by downgrading both our foreign and local currency rating to junk status. Unfortunately, the efforts of now former finance minister Gordhan to stave off a ratings downgrade seem to have been left in tatters at the expense of political manoeuvring. In their reports, both S&P and Fitch highlighted heightened political uncertainty, concerns over the financial health of state-owned enterprises and the abandonment of fiscal consolidation as key reasons behind their respective decisions. The local currency debt, at the time of writing, remains investment grade despite the recent downgrade by Fitch. The importance of this rating should not be underplayed or overlooked as it underpins the bulk of foreign investment flow into our capital market. Markets are forward looking and the threat to the local currency rating has intensified. The situation demands a clear and appropriate policy response. A downgrade of our local currency rating to junk without the proper policy response from government would have dire, far-reaching and long-standing consequences that would alter our economic and social landscapes. South Africa is not alone in facing these uncertainties. Globally, the frequency of sociopolitical-driven shocks is on the rise in both emerging and developed economies. The first quarter of 2017 saw global markets continue to digest implications of a British-less European Union, a Trump US presidency and the rise of populism and nationalism. However, there are positives to point to amidst the noise. The global economy has begun to offer some encouragement as we have seen an incremental pickup in production, demand and growth trends in key geographies. Local data releases during the quarter painted a somewhat mixed picture. Gross domestic product growth for 2016 was recorded at just 0.3% year-on-year (y/y), hurt by a particularly weak fourth quarter (-0.3% quarter-on-quarter (q/q)), down from 1.5% y/y in 2015. Key sectors such as mining and agriculture saw year-on-year declines while manufacturing endured a very tough second half of the year. The local growth outlook continues to remain subdued. Consumer resilience will again be tested in the coming months - in January we saw retail sales come under pressure, which reflected in the results published by some listed companies. However, on a positive note, the latest vehicle sales numbers offer some indication of improving consumer confidence. On the monetary policy front, the South African Reserve Bank (SARB) kept interest rates unchanged following both the January and March meetings as inflation moderated to move closer to the targeted band. Inflation began to taper off in the first quarter particularly as food prices moderated on the back of lower soft commodity prices. In the coming months, the SARB will have to carefully balance their dual mandate of inflation targeting and growth as the potential impact of ratings downgrades begin to manifest. The rand remains a key risk to the inflation outlook. Following the ratings downgrades and subsequent devaluation of the rand, the likelihood of rate cuts by the SARB appears to have diminished in the short term. Over the quarter the rand continued to appreciate relative to the US dollar, gaining 2% to bring the cumulative gain since the end of 2015 to 13%. Since quarter-end, however, the rand has lost 4% to the dollar, at the time of writing. Looking back at the markets in the first quarter of 2017, the FTSE/JSE All Share Issue Date: 22 May 2017 Morningstar data indicates that the SIM Small Cap Unit Trust generated a negative return of 1.59% in the first quarter of 2017 (three months ending 31 March 2017), underperforming the peer average return for the ASISA small- and mid -cap fund category of 1.12%. For the one year to 31 March 2017, the SIM Small Cap Fund generated a positive return of 5.84%, compared to the peer average return for the ASISA small- and mid-cap fund category of 8.45%. By contribution, taking into account total return (share price move and dividend received) and the size of each share within the portfolio, when analysing this past quarter, shares held within the SIM Small Cap Unit Trust that added the most to performance included: Namibia Breweries (generating a 21% total return for the first quarter of 2017), ADvTECH (+17%), Exxaro (+32%), PSG (+13%), Adcorp (+16%) and Grand Parade (+13%). The largest detractors that underperformed from a contribution perspective for the quarter were: Adapt IT (lost 24% for the 3 months ending 31 March 2017), Renergen (-23%), Ascendis Health (-12%), Bowler Metcalf (-8%) and Sygnia (15%). From a trading perspective, new positions added to the portfolio in the first quarter included Blue Label Telecoms, Datatec and Tongaat. The fund also participated in the Sea Harvest Group listing. Positions exited during the period included Spur and Taste. Risks and opportunities Against this difficult backdrop in which we face anaemic local growth and potential further downgrades from ratings agencies, the risks faced by companies in the midand small-cap area of the JSE are elevated. The mid- and small-cap area has a significantly higher exposure to local macroeconomic (‘SA Inc.’) factors relative to the more internationally diversified Top 40 Index. In challenging environments such as this, it is worth reminding investors that our investment principles are unwavering. We continue to rely on our fundamental research to identify undervalued businesses and keep the protection of our clients’ capital at the forefront of our risk management efforts. There are potentially some very dark days ahead for our country. Accompanying this could be heightened volatility in our capital markets. As long-term investors we are prepared to ride out ‘the noise’ and focus on the fundamentals. Our approach in the small- and mid-cap space is rigorous but also dynamic, allowing us to be nimble in order to capitalise on undue fear in the markets. Portfolio Manager(s) Vanessa van Vuuren BBusSc Honours, B. Com (Hons), CFA Management of Investments Risk Profile (Aggressive) Glossary Terms This is an aggressively managed, high-risk portfolio that aims to deliver capital growth over the long term (greater than 5 years). It is designed to substantially outperform the markets and therefore carries a long-term investment horizon (5 years and upwards). The portfolio will be diversified across all major asset classes with significant exposure to equities, and may include offshore equities. There may be some capital volatility in the short term, although higher returns may be expected from five years or beyond. Capital appreciation Capital appreciation is the profit made on an investment, measured by the increase in its market value over the invested amount or cost price. It is also called capital growth. Additional Information LISP (Linked Investment Service Provider) A Linked Investment Service Provider is a financial institution which packages, distributes and administers a broad range of unit trust based investments. Any investment made through these products gives an investor a single point of entry into a selection of different investments. All reasonable steps have been taken to ensure the information on this MDD is accurate,The information to follow does not constitute financial advice as contemplated in terms of the Financial Advisory and Intermediary Services Act. Use or rely on this information at your own risk. Independent professional financial advice should always be sought before making an investment decision. The Sanlam Group is a full member of the Association for Savings and Investment SA. Collective investment schemes are generally medium- to long-term investments. Please note that past performances are not necessarily a guide to future performances, and that the value of investments / units / unit trusts may go down as well as up. A schedule of fees and charges and maximum commissions is available from the Manager, Sanlam Collective Investments (RF) Pty Ltd, a registered and approved Manager in Collective Investment Schemes in Securities. Additional information of the proposed investment, including brochures, application forms and annual or quarterly reports, can be obtained from the Manager, free of charge. Collective investments are traded at ruling prices and can engage in borrowing and scrip lending. Collective investments are calculated on a net asset value basis, which is the total market value of all assets in the portfolio including any income accruals and less any deductible expenses such as audit fees, brokerage and service fees. Actual investment performance of the portfolio and the investor will differ depending on the initial fees applicable, the actual investment date, and the date of reinvestment of income as well as dividend withholding tax. Forward pricing is used. The Manager does not provide any guarantee either with respect to the capital or the return of a portfolio. The performance of the portfolio depends on the underlying assets and variable market factors. Performance is based on NAV to NAV calculations with income reinvestments done on the ex-div date. Lump sum investment performances are quoted. The portfolio may invest in other unit trust portfolios which levy their own fees, and may result is a higher fee structure for our portfolio. All the portfolio options presented are approved collective investment schemes in terms of Collective Investment Schemes Control Act, No 45 of 2002 (“CISCA”). The fund may from time to time invest in foreign instruments which could be accompanied by additional risks as well as potential limitations on the availability of market information. The Manager has the right to close any portfolios to new investors to manage them more efficiently in accordance with their mandates. The portfolio management of all the portfolios is outsourced to financial services providers authorized in terms of the Financial Advisory and Intermediary Services Act, 2002. Standard Bank of South Africa Ltd is the appointed trustee of the Sanlam Collective Investments scheme. Sources of Performance and Risk Data: Morningstar Direct, INET BFA and Bloomberg. The risk free asset assumed for the calculation of Sharpe ratios: STEFI Composite Index. The highest and lowest annualised performance numbers are based on 10 non-overlapping one year periods or the number of non-overlapping one year periods from inception where performance history does not yet exist for 10 years. Trustee Information Standard Bank of South Africa LTD Tel no.: 021 441 4100, E-mail: [email protected] Downside risk The likelihood of a fund's potential to decline in value if market conditions deteriorate. Market capitalization (or market cap) Market capitalization (or market cap) is the total value of the issued shares of a publicly listed and traded company. It is calculated by multiplying the share price by the number of ordinary shares in issue. It is used to determine a company's size and value as a listed entity on the South African stock exchange, as opposed to sales or total asset figures. Sanlam's Pragmatic Value Investment Style This is a philosophy which enables our fund managers to make rational - not emotional - decisions based on in-depth research. This gives them insight into what an asset is truly worth, not what investors are willing to pay based on greed or fear. We take a more practical (pragmatic) approach and invest in stocks that are, in our opinion, trading below their fair value but which do not strictly qualify as value stocks from a theoretical perspective. Sharpe ratio The Sharpe ratio measures risk-adjusted performance of an investment or portfolio. It measures the amount of risk associated with the returns generated by the portfolio and indicates whether a portfolio’s returns are due to excessive risk or not. The greater a portfolio’s Sharpe ratio, the better its risk-adjusted performance has been (i.e. a higher return with a contained risk profile, where the portfolio manager is not taking excessive risk to achieve those returns). Specialist equity fund