FANews
FANews
RELATED CATEGORIES
Category Investments

Plexus: Overview of unit trust returns for the quarter

15 October 2009 Plexus
Dr Prieur du Plessis, Plexus group executive chairman

Dr Prieur du Plessis, Plexus group executive chairman

Ended 30 September 2009

Fears that the surge in global equity prices could come to an abrupt end proved unwarranted as the global equity market, measured by the MSCI World Index, ended 16,9% higher for the third quarter. The MSCI Emerging Market Index returned a staggering 20,1% for the quarter.

The global market was strongly supported by improving economic fundamental factors as well as positive earnings surprises, according to Dr Prieur du Plessis, Plexus group chairman. Although this was the first quarter of positive year-on-year growth for the MSCI World Index since the last quarter of 2007 with 4,7%, the global market ended the quarter 32% below the peak reached in the fourth quarter of 2007.

“The South African market underperformed with a total return of 13,9% during the third quarter due to the rand’s strength against the US dollar,” says Du Plessis. “Furthermore, the local market lagged the MSCI Emerging Market’s 16,2% for the year due to the rand’s appreciation of 9,7% and 6,3% against the US dollar and euro respectively.”

During the quarter, the broad financial and industrial sectors of the South African market outperformed significantly with returns of 15,2% and 16,3% respectively. The FTSE/JSE All Share Index yielded a total return of 7,7% for the 12 months ended 30 September 2009, but is still down 20,3% from the high in the second quarter of 2008.

“Sector rotation was again the name of the game as the FTSE/JSE Gold Index, star performer over one year, lagged with a total return of 6% for the quarter,” says Du Plessis. “The index was the top-performing sector for the 12 months to end September with a total return of 33,1%, followed by the FTSE/JSE Financial Index with 6,5%, FTSE/JSE SA Industrial Index with 15,5% and FTSE/JSE Resources Index with 1,1%.”

Global bonds, as measured by the JP Morgan Global Bond Index, returned 6% for the quarter. The BESA All Bond Index returned 3% with income reinvested, significantly lagging the JP Morgan Emerging Market Bond Index’s 10,2%. Emerging market bonds with 18,3% over the year also led global bonds (14,0%) and the BESA Bond Index (9,1%).

The best-performing unit trust subcategory over three months was the Foreign – Equity – Varied Specialist category with 18,9%. “This can mainly be attributed to the good returns delivered by the global property sector,” says Du Plessis. “The worst-performing subcategory was Foreign – Fixed Interest – Varied Specialist with -1,3% as a result of the strength of the rand.”

Over 12 months the best performing sector was Domestic – Equity – Financial with 16,9%, followed by Domestic – Equity – Value with 15,3%. The worst category over 12 months was the Foreign – Equity – Varied Specialist category with -17,2%

Over three years and five years the best sector was Domestic – Real Estate – General with 13,7% p.a. and 22,0% p.a. respectively.

The two best performing funds over the quarter were global property funds, namely Grindrod Global Property Income Fund with 32,6% and the Fortress REIT Fund with 27,1%. The worst fund over the quarter was the RMB Sterling Income Fund with -6,6%, followed by the Absa Pound Sterling Income Fund with -5,9%.

The 12-month charts were topped by the Satrix Divi Fund and Cadiz Equity Ladder Fund with 33,3% and 31,8% respectively. “The Satrix Divi Fund’s outperformance can be attributed to strong outperformance from the fund from the March 2009 market low. The Cadiz Equity Ladder Fund’s outperformance came from using the excellent protection of derivatives during the market carnage between June 2008 and early March 2009,” says Du Plessis.

The worst fund over twelve months was the STANLIB Small Cap Fund with -32,9%.

The best fund over three years was the Cadiz Equity Ladder Fund with 20,8% p.a. and the best fund over five years was the Old Mutual Mining and Resources Fund with 27,2% p.a.

Du Plessis comments that the volatility in returns and the best and worst performing sectors and funds over the past year have been astounding. “This is due to the market crash and the sharp recovery we have seen in equity prices since the March lows,” he says. “Volatility once again reminds investors that equity funds are a long-term investment and one should not be tempted to time the market.”

For investors who missed the rally due to underweight equity exposure, the decision of when to buy is now extremely difficult. “It seems as if markets have outrun the economic fundamentals, yet they continue to make new highs,” says Du Plessis. “For the rally to continue, we need to see the stimulus packages working through to companies’ bottom lines. If not, there could very well be a pull-back in prices.”

His advice to investors is to take things slow and phase money into the market. “The next few months may prove to be a bumpy ride and investors should use pull-backs as a buying opportunity.”

Best and worst sectors

 

1 month

Best

%

Domestic--Equity--Smaller Companies

4.33%

Gold and Precious Metals

3.78%

Domestic--Real Estate--General

1.84%

Domestic--Equity--Value

1.81%

Worldwide--Equity--Varied Specialist

1.77%

Worst

Domestic--Equity--Large Cap

-0.08%

Foreign--Equity--General

-0.24%

Foreign--Asset Allocation--Flexible

-0.83%

Foreign--Fixed Interest--Bond

-1.46%

Foreign--Fixed Interest--Varied Specialist

-2.98%

3 months

Best

%

Foreign--Equity--Varied Specialist

18.94

Domestic--Equity--Financial

17.54

Domestic--Equity--Value

17.41

Domestic--Equity--Smaller Companies

17.34

Domestic--Equity--Industrial

15.80

Worst

Domestic--Fixed Interest--Varied Specialist

2.39

Domestic--Fixed Interest--Bond

2.21

Domestic--Fixed Interest--Income

2.20

Domestic--Fixed Interest--Money Market

2.03

Foreign--Fixed Interest--Varied Specialist

-1.31

6 months

Best

%

Domestic--Equity--Smaller Companies

34.60

Domestic--Equity--Financial

34.15

Domestic--Equity--Value

33.70

Domestic--Equity--Industrial

31.83

Domestic--Equity--Growth

29.88

Worst

Domestic--Fixed Interest--Bond

3.08

Foreign--Asset Allocation--Flexible

0.72

Gold and Precious Metals

-6.80

Foreign--Fixed Interest--Bond

-7.51

Foreign--Fixed Interest--Varied Specialist

-13.74

12 months

Best

%

Domestic--Equity--Financial

16.87

Domestic--Equity--Value

15.33

Domestic--Real Estate--General

14.73

Domestic--Equity--Varied Specialist

13.78

Domestic--Equity--Industrial

13.48

Worst

Worldwide--Equity--General

-4.64

Foreign--Asset Allocation--Flexible

-7.15

Foreign--Fixed Interest--Varied Specialist

-8.80

Foreign--Equity--General

-10.04

Foreign--Equity--Varied Specialist

-17.16

Three years

Best

% per year

Domestic--Real Estate--General

13.73

Domestic--Equity--Industrial

10.76

Domestic--Fixed Interest--Money Market

10.12

Domestic--Equity--Value

9.96

Domestic--Fixed Interest--Income

9.37

Worst

Worldwide--Equity--General

1.28

Gold and Precious Metals

0.38

Foreign--Asset Allocation--Flexible

-1.84

Foreign--Equity--General

-6.57

Foreign--Equity--Varied Specialist

-10.06

Five years

Best

% per year

Domestic--Real Estate--General

22.01

Domestic--Equity--Resources & Basic Industries

21.91

Domestic--Equity--Industrial

21.50

Domestic--Equity--Value

20.44

Domestic--Equity--Large Cap

18.66

Worst

Foreign--Fixed Interest--Bond

7.96

Foreign--Asset Allocation--Flexible

6.42

Foreign--Equity--General

5.77

Foreign--Fixed Interest--Varied Specialist

5.72

Foreign--Equity--Varied Specialist

4.69

Source: Profile Media

 

Best and worst funds

1 months

Best

%

SIM Small Cap Fund A

5.56

STANLIB Small Cap Fund A

5.23

Sasfin TwentyTen Fund

5.07

Nedgroup Investments Entrepreneur Fund A

4.99

STANLIB Industrial Fund A

4.61

Worst

RMB US Dollar Income Fund A

-4.17

Marriott Global Income Fund A

-4.62

Old Mutual UK Money Market Feeder Fund A

-4.64

RMB Sterling Income Fund A

-4.77

Absa Pound Sterling Income Fund

-4.98

3 months

Best

%

Grindrod Global Property Income Fund

32.61

Fortress REIT Fund A

27.05

SIM Small Cap Fund A

20.93

Cadiz Mastermind Fund A

20.27

Nedgroup Investments Financials Fund A

20.09

Worst

RMB US Dollar Income Fund A

-4.05

RMB International Income Fund A

-4.15

Old Mutual UK Money Market Feeder Fund A

-5.52

Absa Pound Sterling Income Fund

-5.94

RMB Sterling Income Fund A

-6.56

6 months

Best

%

Fortress REIT Fund A

47.46

Old Mutual Value Fund A

41.79

Cadiz Mastermind Fund A

40.21

RMB Financial Services Fund A

39.63

Nedgroup Investments Financials Fund A

39.55

Worst

RMB International Income Fund A

-16.16

Absa US Dollar Income Fund

-19.89

STANLIB US Dollar Cash Fund of Funds A

-20.20

Investment Solutions US Dollar Cash Feeder Fund

-20.76

RMB US Dollar Income Fund A

-21.33

12 months

Best

%

Satrix Div Plus Portfolio A

33.30

Cadiz Equity Ladder Fund

31.76

Discovery Equity Fund

22.48

Discovery Flexible Property Fund

21.58

Coronation Top 20 Fund A

21.51

Worst

STANLIB International Property Fund A

-19.67

Nedgroup Investments International Equity Feeder Fund A

-19.76

Fortress REIT Fund A

-23.28

Marriott Global Real Estate Fund A

-32.84

STANLIB Small Cap Fund A

-32.90

Three years

Best

% per year

Cadiz Equity Ladder Fund

20.84

Investec Property Equity Fund A

17.41

STANLIB Property Income Fund A

17.24

Catalyst SA Property Equity Fund A

16.48

Prudential Enhanced SA Property Tracker Fund A

16.32

Worst

Absa International Fund A

-10.78

RMB Global Fund

-11.23

STANLIB Small Cap Fund A

-12.08

STANLIB International Property Fund A

-12.76

Marriott Global Real Estate Fund A

-17.36

Five years

Best

% per year

Old Mutual Mining and Resources Fund A

27.22

Investec Property Equity Fund A

26.29

Coronation Top 20 Fund A

25.59

STANLIB Property Income Fund A

25.25

Kagiso Equity Alpha Fund A

24.67

Worst

Sentinel Worldwide Flexible Fund of Funds

1.38

Marriott Global Real Estate Fund A

0.46

Oasis Crescent Worldwide Flexible Fund of Funds

-1.48

IMC Worldwide Flexible Fund of Funds

-3.03

Quantum Worldwide Flexible Fund of Funds

-5.67

Source: Profile Media

Quick Polls

QUESTION

What is your one-liner for the 2024 National Budget speech?

ANSWER

Creepy failure to adjust income tax, medical tax credits
Overall happy, it should support economic growth
Overall unhappy, soaring public sector wages and broken SOEs suck..
There are too few taxpayers, too many grant recipients.
fanews magazine
FAnews February 2024 Get the latest issue of FAnews

This month's headlines

On the insurance industry’s radar in 2024
Insurers, risk managers unsure of AI’s judgement credentials
Is offshore the place to be in 2024?
Gap claims: erosion of medical benefits, soaring specialist fees
Investments and retirement… is conventional wisdom under threat?
Subscribe now