Download PSG Global Equity Feeder Fund Class A

PSG Global Equity Feeder Fund Class A
Minimum Disclosure Document as at 30 June 2017
FUND FACTS
FUND CHARACTERISTICS
This fund feeds all investments directly to the PSG Global Equity Sub­Fund, a fund
which invests in equi�es. This fund aims to produce the highest real (above infla�on)
MSCI Daily Total Return Net World USD Index (in ZAR)
returns over the long­term. The fund sits at the top end of the risk/return spectrum
No and investors should be comfortable with stock market fluctua�ons and should have
an investment horizon of seven years and longer. Please refer to the Minimum
Philipp Wörz and Greg Hopkins Disclosure Document of the PSG Global Equity Sub­Fund for full informa�on on the
fund.
Sector
Global ­ Equity ­ General
Benchmark
Regula�on 28 compliant
Fund Managers
Fund Launch Date
3 May 2011
Fund Size (ZAR)
135,722,030
Month end NAV Price (cpu)
225.18
Minimum Investment
RISK CLASSIFICATION
R2000 lump sum or R250 monthly debit order
Distribu�on Frequency
February
Latest Distribu�on (cpu) 28 Feb 17
0.00c
Max. Adviser Fee % (incl. VAT)
2.28
Annual Management Fee % (incl. VAT)
0.86
Total Expense Ra�o % (incl. VAT)
2.40
For a breakdown of the Total Investment Charge, please refer to page 2.
INVESTMENT OBJECTIVE
INVESTMENT POLICY
The fund aims to outperform the average of the world's equity markets, as The PSG Global Equity Feeder Fund is a Rand denominated Equity Feeder Fund,
represented by the MSCI Daily Total Return Net World USD Index (in ZAR) (the feeding solely into the PSG Global Equity Sub­Fund, denominated in US Dollars and a
"Benchmark").
sub­fund of PSG Global Funds Sicav plc. The por�olio’s investment strategy will
a�empt to reduce the compara�ve risk of loss over an investment period of four or
more years. The por�olio aims to achieve capital growth over the long term, with the
genera�on of income not being a main objec�ve of the por�olio.
REGIONAL ALLOCATION
TOP 10 EQUITY HOLDINGS
%
United States
40
United Kingdom
16
Europe
Brookfield Asset Management Inc
Cisco Systems Inc
Yahoo Japan Corp
Berkshire Hathaway Inc
AIA Group Ltd
Glencore plc
Colfax Corp
Discovery Holdings Ltd
Union Pacific Corp
Babcock Interna�onal Group plc
2
Asia
14
Canada
8
Singapore
1
Cash
16
Africa
3
Total
100
HOW THE FUND HAS PERFORMED SINCE 3 May 2011 (Cumula�ve)
ANNUALISED PERFORMANCE % (a�er fees)
350.0
300.0
250.0
200.0
150.0
50.0
2011
2012
PSG Global Equity Feeder Fund A (Performance)
2013
2014
2015
2016 2017
MSCI Daily Total Return Net World USD in ZAR (Benchmark)
Return
100.0
24.0
22.0
20.0
18.0
16.0
14.0
12.0
10.0
8.0
6.0
4.0
2.0
0.0
22.4
20.4
17.9
14.9
14.1
12.8
11.4
8.7
6.7
5.8
1 year
2 years
3 years
PSG Global Equity Feeder Fund A (Performance)
5 years
Incep�on
MSCI Daily Total Return Net World USD in ZAR (Benchmark)
Performance Sta�s�cs % (annualised)
Return
Best Month
Worst Month
YTD
(not
annualised)
3.77
3.04
­1.72
2016
2015
2014
2013
2012
3.47
10.95
­13.17
14.74
10.94
­7.30
10.59
3.62
­4.02
17.01
16.04
­13.17
16.69
16.04
­13.17
MANAGEMENT COMPANY: PSG Collec�ve Investments (RF) Limited, 1st Floor, Alphen Office Park, Constan�a Main Road, Constan�a, 7806 Tel: +27 (21) 799 8000, Email: [email protected], Website: www.psg.co.za/asset­management
Date issued: 14 July 2017
PSG Global Equity Feeder Fund
Quarterly Portfolio Commentary as at 30 June 2017
by Philipp Wörz and Greg Hopkins
Current context
Given the backdrop of elevated market valuations, global stocks continued their strong performance during the second
quarter, with the MSCI World Index delivering a positive return of 9.43% (11.01% including dividends) year to date.
The tech-heavy Nasdaq index outperformed comfortably (+14.67%), while an acceleration in European growth,
coupled with a market-friendly election outcome in France and dollar weakness, drove European stocks 15.91% higher.
Emerging markets also ended two years of underperformance and returned 18.55% year to date. (All returns quoted
in US dollars.)
This does not necessarily mean that all markets and all market sectors had an easy year. Value stocks, which
outperformed last year on the back of higher growth, inflation and interest rate expectations post Donald Trump’s
election, underperformed the broader market as the likelihood of effective policies to drive US growth diminished
significantly. Continued threats of disruption (both perceived and real) by online retailers and lower-cost competitors
have also driven the prices of US retailers down by 7% at an index level. In addition, while most emerging markets have
seen their currencies and stock markets appreciate considerably this year, countries such as Brazil and South Africa
continue to excel at scoring political own goals. Markets in both these countries have underperformed both emerging
and global market peers.
Our perspective
We inherently like to buy high-quality companies with attractive growth prospects, at attractive valuations. We do not
consider very expensive stocks that are deemed to be defensive as low-risk investment opportunities, and we expect
muted long-term performance from such stocks. Rather, we think the risk is lower (and the opportunity better) in
quality assets that are currently out of favour, yet offer excellent long-term prospects. This is reflected in the
construction of the portfolio.
In fact, the divergence in valuations between the most expensive parts of the markets relative to the cheapest is still
as extreme as it was during the dot-com bubble (as shown in the charts below). This warrants caution, but also presents
stock-picking opportunities away from the popular crowd.
Global price-to-book (cheap/expensive)
0.300
0.250
0.200
0.150
0.100
0.050
Source: Bernstein Research, PSG Asset Management
2016/04
2015/01
2013/10
2012/07
2011/04
2010/01
2008/10
2007/07
2006/04
2005/01
2003/10
2002/07
2001/04
2000/01
1998/10
1997/07
1996/04
1995/01
1993/10
1992/07
1991/04
1990/01
0.000
Global composite value: P:E, dividend yield, price/book
(cheap/expensive)
2016/11
2015/09
2014/07
2013/05
2012/03
2011/01
2009/11
2008/09
2007/07
2006/05
2005/03
2004/01
2002/11
2001/09
2000/07
1999/05
1998/03
1997/01
1995/11
1994/09
1993/07
1992/05
1991/03
1990/01
0.5
0.45
0.4
0.35
0.3
0.25
0.2
0.15
0.1
0.05
0
Source: Bernstein Research, PSG Asset Management
Portfolio positioning
Our portfolios are constructed from the bottom up and are diversified across regions, industries and currencies. We
continue to have strong conviction in our large portfolio holdings, namely Brookfield Asset Management, Cisco
Systems, Yahoo Japan and AIA Group. We are also well exposed to some high-quality cyclical companies on low levels
of earnings. Finally, while cognisant of the risks, we are finding great opportunities in the United Kingdom, emerging
markets and areas such as agricultural commodity producers.
Complacency and significant amounts of greed in some parts of the market have allowed us to reallocate capital out
of securities where valuations have approached or exceeded our estimates of intrinsic value, into investment
opportunities where fear and uncertainty have driven prices to attractive valuation levels. We have exited or
significantly reduced our positions in Apple, Mastercard, Microsoft, Sainsbury’s and J.P. Morgan, while allocating
capital to companies such as Discovery (an outstanding global opportunity in our view), The Mosaic Company (the
world’s largest potash and phosphate producer) and Babcock International (the UK’s leading defence and engineering
outsourcer).
A backdrop of rising asset prices and expensive valuations for the world’s best companies informs the fund’s current
cash holding.
The world remains an uncertain place, with the impacts of US policy changes, balance sheet normalisation by central
banks, geopolitical tensions and many other factors, yet unknown. The securities in the fund are trading at a significant
margin of safety and we are ready to deploy additional firepower once further high-conviction investment
opportunities become available.
PSG Global Equity Feeder Fund Class A
Minimum Disclosure Document as at 30 June 2017
Who should invest in the PSG Global Equity Feeder Fund?
Total Expense Ra�o (TER)
The total expense ra�o (TER) is the annualised percentage of the Fund’s average
The fund is suitable for investors who:
assets under management that has been used to pay the Fund’s actual expenses
over the past three years. The TER includes the annual management fees that have
Ÿ seek an equity­focused por�olio that has outstanding growth poten�al
been charged, other expenses like audit and trustee fees and VAT. As unit trust
Ÿ aim to maximise poten�al returns within a moderate risk investment
expenses vary, the current TER cannot be used as an indica�on of future TERs. A
Ÿ focus on a long­term investment horizon
higher TER ra�o does not necessarily imply a poor return, nor does a low TER imply a
good return. The TER and other funds’ TERs should then be used to evaluate
Feeder Fund
whether the Fund performance offers value for money. The Annual Management Fee
A Feeder Fund is a por�olio which, apart from assets in liquid form, invests in a of the PSG Global Equity Sub­Fund is included in the TER.
single por�olio of a collec�ve investment scheme, which levies its own charges and
which could result in a higher fee structure for the feeder fund.
Transac�on costs
Transac�on costs are shown separately. Transac�on costs are a necessary cost in
General informa�on and risks
administering the Financial Product and impacts Financial Product returns. They
Collec�ve Investment Schemes (CIS) in securi�es are generally medium to long­term should not be considered in isola�on as returns may be impacted by many other
investments. The value of par�cipatory interests (units) or the investment may go factors over �me including market returns, the type of Financial Product, the
down as well as up and past performance is not a guide to future performance. investment decisions of the Fund Manager and the TER.
Fluctua�ons or movements in the exchange rates may cause the value of underlying
interna�onal investments to go up or down. CIS are traded at ruling prices and can Total investment charge
engage in borrowing and script lending. The Fund may borrow up to 10% of its The sum of the TER and transac�on costs is shown as the Total Investment
market value to bridge insufficient liquidity. Where foreign securi�es are included in Charge. Since Fund returns are quoted a�er the deduc�on of these expenses, the
a por�olio, the por�olio is exposed to risks such as poten�al constraints on liquidity TER and Transac�on costs should not be deducted again from published returns.
and the repatria�on of funds, macroeconomic, poli�cal, foreign exchange, tax,
se�lement and poten�al limita�ons on the availability of market informa�on. The Total Investment Charge annualised for the period 1/7/2014 to 30/6/2017
por�olios may be capped at any �me in order for them to be managed in accordance Annual Management Fee and other costs (incl. VAT) 2.40%
with their mandate. Excessive withdrawals from the por�olio may place the por�olio Total Expense Ra�o (incl. VAT)
2.40%
under liquidity pressures and in such circumstances a process of ring­fencing of Transac�on Costs (incl. VAT)
0.47%
withdrawal instruc�ons and managed payouts over �me may be followed. PSG Total Investment Charge (incl. VAT)
2.87%
Collec�ve Investments (RF) Limited does not provide any guarantee either with
respect to the capital or the return of the por�olio.
Cut­off �mes
The cut­off �me for submi�ng investment transac�ons is 14h30 daily, with the
Performance
excep�on of the PSG Money Market Fund which is 11h00.
All performance data for a lump sum, net of fees, includes income and assumes
reinvestment of income on a NAV to NAV basis. Annualised performances show Company details
longer term performance rescaled over a 12 month period. Individual investor PSG Collec�ve Investments (RF) Limited is registered as a CIS Manager with the
performance may differ as a result of ini�al fees, the actual investment date, the Financial Services Board, and a member of the Associa�on of Savings and
date of reinvestment and dividend withholding tax. Performance is calculated for the Investments South Africa (ASISA) through its holding company PSG Konsult Limited.
por�olio and individual investor performance may differ as a result thereof. The The management of the por�olio is delegated to PSG Asset Management (Pty) Ltd,
por�olio is valued at 15h00 daily. Income distribu�ons are net of any applicable an authorised Financial Services Provider under the Financial Advisory and
taxes. Actual annual figures are available to the investor on request. Prices are Intermediary Services Act 2002, FSP no 29524. PSG Asset Management (Pty) Ltd and
published daily and available on the website www.psg.co.za/asset­management and PSG Collec�ve Investments (RF) Limited are subsidiaries of PSG Konsult Limited. PSG
in the daily newspapers. Figures quoted are from Morningstar Inc
Collec�ve Investments (RF) Limited and can be contacted on +27 (21) 799 8000; (toll
free) 0800 600 168, via email [email protected].
Pricing
Forward pricing is used. Unit trust prices are calculated on a net asset value (NAV) Conflict of Interest Disclosure
basis, which is the market value of all assets in the Fund including income accruals The Fund may from �me to �me invest in a por�olio managed by a related party.
less permissable deduc�ons divided by the number of units in issue.
PSG Collec�ve Investments (RF) Limited or the fund manager may nego�ate a
discount in fees charged by the underlying por�olio. All discounts nego�ated are re­
Fees
invested in the Fund for the benefit of the investors. Neither PSG Collec�ve
A schedule of fees and charges and maximum commissions is available on request Investments (RF) Limited nor PSG Asset Management (Pty) Ltd retains any por�on of
from PSG Collec�ve Investments (RF) Limited. Commission and incen�ves may be such discount for their own accounts. The Fund Manager may use the brokerage
paid and, if so, are included in the overall costs. Different classes of Par�cipatory services of a related party, PSG Securi�es Ltd.
Interest can apply to these por�olios and are subject to different fees, charges and
possibly dividend withholding tax and will thus have differing performances.
Trustee
The Standard Bank of South Africa Limited, Main Tower, Standard Bank Centre, 2
Hertzog Boulevard, Cape Town, 8001. Tel: +27 (21) 401 2443. Email: compliance­
[email protected].
Addi�onal informa�on
Addi�onal informa�on is available free of charge on the www.psg.co.za/asset­
management and may include publica�ons, brochures, applica�on forms and annual
reports.
MANAGEMENT COMPANY: PSG Collec�ve Investments (RF) Limited, 1st Floor, Alphen Office Park, Constan�a Main Road, Constan�a, 7806 Tel: +27 (21) 799 8000, Email: [email protected], Website: www.psg.co.za/asset­management
Date issued: 14 July 2017
Disclaimer
ESTOR DETAILSVESTOR DETAILS
The information and content of this publication is provided by PSG as general
information about its products. The information does not constitute any advice
and we recommend that you consult with a qualified financial adviser before
making investment decisions. For further information on the funds and full
disclosure of costs and fees please refer to the Minimum Disclosure Documents
on our website.
Disclaimer: Collective Investment Schemes in Securities (CIS) are generally
medium- to long-term investments. The value of participatory interests (units) or
the investment may go down as well as up and past performance is not a guide to
future performance. CIS are traded at ruling prices and can engage in borrowing
and script lending. The Funds may borrow up to 10% of the market value to bridge
insufficient liquidity. Fluctuations or movements in the exchange rates may cause
the value of underlying international investments to go up or down. Where
foreign securities are included in a portfolio, the portfolio is exposed to risks such
as potential constraints on liquidity and the repatriation of funds,
macroeconomic, political, foreign exchange, tax, settlement and potential
limitations on the availability of market information. The portfolios may be
capped at any time in order for them to be managed in accordance with their
mandate. Excessive withdrawals from the fund may place the portfolio under
liquidity pressures and, in certain circumstances a process of ring-fencing
withdrawal instructions may be followed. PSG Collective Investments (RF) Limited
does not provide any guarantee either with respect to the capital or the return of
the portfolio.
Fees and performance:
Prices are published daily and available on the website www.psg.co.za and in the
daily newspapers. A schedule of fees and charges and maximum commissions is
available on request from PSG Collective Investments (RF) Limited. Commission
and incentives may be paid and, if so, are included in the overall costs. Forward
pricing is used. Different classes of Participatory Interest can apply to these
portfolios and are subject to different fees, charges and possibly dividend
withholding tax and will thus have differing performances. Performance is
calculated for the portfolio and individual investor performance may differ as a
result thereof. All performance data for a lump sum, net of fees, include income
and assumes reinvestment of income on a NAV-NAV basis. Income distributions
are net of any applicable taxes. Annualised performance show longer term
performance rescaled over a 12 month period. Individual investor performance
may differ as a result of initial fees, the actual investment date, the date of
reinvestment and dividend withholding tax. . Unit Trust prices are calculated on a
net asset value (NAV) basis, which is the market value of all asses in the fund
including income accruals less permissible deductions divided by the number of
units in issue. Actual Annual Figures are available to the investor on request.
Source of performance: Figures quoted are from Morningstar Inc.
Cut-off times: The cut-off time for processing investment transactions is 14h30
daily, with the exception of the PSG Money Market Fund, which is 11h00. The
portfolio is valued at 15h00 daily.
Additional information: Additional information is available free of charge on the
website and may include publications, brochures, application forms and annual
reports.
Company details: PSG Collective Investments (RF) Limited is registered as a CIS
Manager with the Financial Services Board, and a member of the Association of
Savings and Investments South Africa (ASISA) through its holding company PSG
Konsult Limited. The management of the portfolios is delegated to PSG Asset
Management (Pty) Limited, an authorised Financial Services Provider under the
Financial Advisory and Intermediary Services Act 2002, FSP no 29524. PSG Asset
Management (Pty) Limited and PSG Collective Investments (RF) Limited are
subsidiaries of PSG Konsult Limited.
Trustee: The Standard Bank of South Africa Limited, Main Tower, Standard Bank
Centre, 2 Hertzog Boulevard, Cape Town, 8001. Tel: +27 (21) 401 2443.
Email: [email protected].
Conflict of Interest Disclosure: The Fund may from time to time invest in a
portfolio managed by a related party. PSG Collective Investments (RF) Limited or
the Fund Manager may negotiate a discount in fees charged by the underlying
portfolio. All discounts negotiated are re-invested in the Fund for the benefit of
the investor. Neither PSG Collective Investments (RF) Limited nor PSG Asset
Management (Pty) Limited retains any portion of such discount for their own
accounts. The Fund Manager may use the brokerage services of a related party,
PSG Securities Ltd.
MANAGEMENT COMPANY:
PSG Collective Investments (RF) Limited
1st Floor, PSG House
Alphen Park
Constantia Main Road,
Constantia
7806
Toll-free
Tel:
Email:
Website:
0800 600 168
+27 (21) 799 8000
[email protected]
www.psg.co.za/asset-management
Date issued: 14 July 2017