Category Investments

Momentum Launches Positive Return Fund - Unit Trust Fund for Uncertain Times

09 November 2011 Mickey Gambale, head product development Momentum Wealth
Mickey Gambale

Mickey Gambale

Momentum Wealth, a division of Momentum Group Ltd, recently unveiled its latest fund offering – the Momentum Positive Return Fund - which aims to provide capital preservation in real terms [returns that beat inflation] with conservative equity exposure to investors.

Against a backdrop of global market uncertainty and economic fears in Europe and the US, the Momentum Positive Return Fund comes at an ideal time for investors who are concerned about market performance and preserving their capital.

Mickey Gambale, head of product development for Momentum Wealth comments: “Investors are currently in an uncertain position in terms of trying to find strategies and funds that can help them grow their investment and protect downside. Conservative investors cannot simply invest in cash the way they used to when equity markets proved too volatile. Cash returns are currently lagging inflation, which means that investors’ capital is not growing in real terms. We decided to create the Momentum Positive Return Fund to offer investors a middle ground – conservative equity exposure and protected growth.”

The fund aims to achieve consistent positive returns by investing in a mix of interest bearing and equity-type assets. At the same time, the fund seeks to preserve capital against the possibility that the equity-type assets might fall in value. The unit trust fund is characterised as Absolute Return according to the Association of Savings and Investment in South Africa [ASISA] fund classifications.

The fund has two distinct objectives:

1. Capital preservation – the fund aims to have no negative returns over any rolling 12-month period.

2. Capital growth - to outperform inflation by at least 3.5% p.a. (net return) over a rolling 3-year period.

The Momentum Positive Return Fund is suited to conservative investors who want to preserve their investment capital but who also seek capital growth. The fund is particularly suited to retirement-type investors but any conservative investor wanting limited equity exposure will benefit from investing in the fund.

Gambale comments: “The reason we developed this fund is to help investors who need their money to grow ahead of inflation and who require capital preservation so that they don’t lose their invested capital. We anticipate that markets will remain unpredictable for some time and that investors will increasingly need to find different ways to invest. The “old” ways of investing will not work in these markets. Investors need to be more creative and we are helping them do this by developing funds that can achieve multiple purposes.”

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