Category Investments

Momentum Asset Management’s Money Market Fund’s rating affirmed by Fitch Ratings

22 April 2015 Momentum

Global ratings agency, Fitch Ratings, has affirmed the Momentum Money Market Fund an 'AA+(zaf)' National Fund Credit Rating (NFCR) and a 'V1(zaf)' National Fund Volatility Rating (NFVR). This ranking is determined in accordance with Fitch’s global bond fund rating criteria and is the highest money market fund rating in South Africa.

The fund’s 'AA+(zaf)' NFCR rating is driven by its high current and prospective weighted average credit quality. Funds in this rating category are considered to have very high underlying credit quality relative to other entities in the South African market. The fund’s 'V1(zaf)' rating is driven by its low exposure to interest rate and spread risk resulting from the short maturities on its assets. Funds in this rating category are considered to have low sensitivity to market risk, with returns expected to exhibit high stability across a range of market scenarios.

Concentration risk is also moderate when compared to the fund’s peers due to its large single issuer and largest five issuer exposure(s) exceeding the guidelines for ‘moderate concentration’ discussed in Fitch’s rating criteria.

The fund held assets under management worth approximately R10 billion as at 1 April 2015. It invests in fixed and floating-rate money market instruments, including negotiable certificates of deposit, promissory notes, fixed deposits issued primarily by the major South African and foreign banks with local operations and corporate issuers. The fund primarily invests in issuers rated in the 'F1+(zaf)'/'AA(zaf)' rating category, but can also hold securities in the 'BBB(zaf)' rating category.

Momentum Asset Management is a subsidiary of JSE-listed MMI Holdings, which is rated AA-(zaf)/Stable in its own right. As at end-June 2014, Momentum Asset Management’s total assets under management were approximately R182 billion, of which R84 billion was managed by the fixed-income capability in the business. The Momentum Money Market Fund is managed by Conrad Wood and Richard Klotnick, both of whom have extensive experience and tenure.

Commenting on the ratings, Wood said: “It is very meaningful for us to once again be rated so highly by Fitch. Our fund has continued to meet their exacting evaluations of asset credit quality, concentration and sensitivity to market risk.”

For more on multi-investment strategy capabilities that deliver diversified and sustainable investment performance through various investment cycles, visit or follow us on Twitter @MomentumAM.

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