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Real estate investors score in first quarter

26 April 2013 PlexCrown Fund Ratings

Global Equity General with a return of 16,43% was rated the best-performing unit trust subcategory for the quarter to 31 March 2013, while Global Real Estate was the best subcategory overall for the year with a return of 39,11%, according to PlexCrown Fun

South African Real Estate ranks as the best-performing South African subcategory in latest quarterly PlexCrown Survey for the March quarter with 8,04% (dividends and interest reinvested), followed by South African Equity Industrial and South African Equity Mid- and Small Cap with 6,73% and 6,19% respectively. The subcategory was also the third-best overall over one and five years and second-best over three years. The Resources subcategory was the worst-performing subcategory over all periods measured to the end of the March quarter.

Old Mutual Global Equity Fund and Allan Gray-Orbis Global Equity Feeder Fund were the best performing funds over the quarter with total returns of 22,94% and 22,79% respectively.

Prescient Africa Equity Fund and Momentum Africa Fund were the best performing funds over the last year to 31 March with 53,82% and 53,66% respectively, while Satrix INDI and Coronation Industrial topped the charts over three and five years respectively.

In the quarter, 445 funds were rated compared to 381 funds at the end of December 2012. The increase was mostly due to the fact that funds, which were previously unrated due to their listings in subcategories where benchmarks and mandates varied widely, were moved into subcategories where they can now be compared to similar funds. In total, 17 funds lost their ratings.

Coronation was again the leading management company in the first quarter of 2013 and achieved a near-perfect overall rating of 4.906 PlexCrowns out of a maximum of 5.000. Coronation had the highest South African rating of 4.926 PlexCrowns. This was secured by a fifth-highest rating in the broad South African Equity and Real Estate category, third-highest ratings in South African Interest-bearing and Income and the broad South African Multi-asset classes. Coronation also had the third-highest rating in Global and Worldwide with 4.793 PlexCrowns. Six of Coronation’s funds were ranked top in their respective subcategories, while 16 (84%) of the company’s 19 rated funds achieved above-average ratings of 4 or more PlexCrowns.

Allan Gray had the second highest overall rating with 4.613 PlexCrowns. Allan Gray had the second-highest South African rating of 4.721 PlexCrowns that was underpinned by sharing the highest ratings in the broad South African Equity and Real Estate and the South African Interest-bearing and Income categories respectively. The company had the fifth-highest rating in the South African Multi-asset category and also shared the fifth-highest rating in the Global and Worldwide category. Five (71%) of the investment house’s rated funds achieved above-average ratings of 4 or more PlexCrowns.

Nedgroup Investments had the third highest management company rating with 3.837 PlexCrowns. Nedgroup Investments’ South African rating of 3.967 PlexCrowns was the third-highest of all management companies and was underscored by fourth places in the South African Interest-bearing and Income and the South African Multi-asset categories. The investment house’s overall rating was, however, diluted somewhat by average showings in the broad South African Equity and Real Estate category and the Global and Worldwide category. Seven of the company’s 15 rated funds had above-average ratings.

Among the management companies that did not qualify for overall management company ratings, Foord shared the highest ratings in the broad South African Equity and Real Estate and South African Multi-asset categories, while Regarding Capital Management led the way in the broad Global and Worldwide category.

FirstGlobal was the only non-management company with its funds administered as third-party funds by a registered management company that conformed to the requirements for an overall rating. The company achieved an overall rating of 3.723 PlexCrowns.

The best-performing foreign category for the three months ended March 2013 was the Japan-Equity-General category with 22,45%. Global-Real Estate-General was the best-performing category over 12 months with 38,62%. The USA-Equity-Varied Specialist category was the best-performing category over three and five years with 23,38% and 14,22% per year respectively.

The Franklin Biotechnology Discovery Fund was the best-performing FSB-approved foreign fund for three and 12 months with 29,55% and 55,43% respectively.

At the end of March, 104 FSB-approved foreign funds were rated, compared to the 90 at the end of the previous quarter.

Oasis was the leading FCIS manager with an overall offshore rating of 4.250 PlexCrowns. This was underscored by achieving a top rating in Global Real Estate General and a joint eighth place in Global Equity. Momentum was runner-up with an overall offshore rating of 4.000 PlexCrowns. The investment house achieved the joint second-highest rating in Global Asset Allocation and joint third-highest rating in Global Equity. AF (Alexander Forbes) Strategic had the third-highest overall offshore rating of 3.750 PlexCrowns.

The PlexCrown Survey was based on data provided by Profile Data and new fund classifications by ASISA that became effective on 1 January 2013. Past PlexCrown Surveys are available to subscribers at www.plexcrown.com

Please note:
In terms of the new qualifying requirements a management company must have a rated fund in each of the broad unit trust sectors, also known as major asset classes. The methodology to calculate the ratings of management companies has changed from equally-weighted skills based to a comprehensive methodology that applies weights to each of the four broad unit trust sectors or asset classes based on the sizes of the asset classes and skill. The size of a rated fund of a company relative to the combined size of all the rated funds in that company’s fold in a specific broad asset class is also taken into account to determine each management company’s rating in their broad unit trust sectors or asset classes.

Only registered CIS management companies may qualify for management company ratings (South African, Global and Overall). Other companies are rated separately if their funds are listed as “third-party funds” under a registered CIS management company and they satisfy the same qualification requirements as for their registered counterparts.

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