29/01/2020
NEWSLETTER – JANUARY 2020 – 1st edition
As the new year roars forward, I thought to communicate to you, where we are going as a Company and share some of our strategies and plans for the new year. I trust that by sharing investment strategies and interesting points with you, you will be able to capitalize on growth opportunities in your investments this year, where relevant.
To-date, there has been no fund targeted specifically at Capital Preservation - Post Retirement. I approached Glacier at Sanlam and I am very pleased to introduce AFSAFIN ILLA Warp Fund – designed especially for Capital Preservation. We have many clients that have retired and the continuous struggle to preserve capital has resulted in us looking for a wrap portfolio structured to mitigate returns higher than inflation drawdowns. This AFSAFIN ILLA, was made available late 2019 with many of my clients already onboard and invested.
Our AFSAFIN Wrap Funds are available on Sanlam Glacier and Allan Gray Platforms and we are in the process with Absa Investments Management Services (AIMS). AFSAFIN ILLA is available on all platforms that have our Wrap funds on.
Investments can be from discretionary or non-discretionary funds although please bear in mind that non-discretionary funds-compulsory (retirement products) are regulated by Regulation 28 of the Pension Funds Act.
I have included “Fund Fact Sheets” to give you an idea of past fund performances although past performances are not indicative of future performances.
Our AFSAFIN page will reflect our investment strategies for this year based on market indicators – please go and like our page to ensure you do not miss out
This information will not be relevant to all investments we manage but it does have its place. I would really appreciate it if you could take the time to read my newsletters as it was compiled for you to remain updated with our development.
It is important to note that only Flexible Investments, Living Annuities, preservation funds and Retirements specifically on these platforms are able to invest in these funds. Many of you are invested in structured endowments and different products for reason specific to your specific financial plan. All investments are monitored monthly and when necessary and applicable I will make recommendations around AFSAFIN wrap funds.
WRAP FUNDS UNDERSTOOD:
A wrap fund consists of a combination of collective investment schemes (also known as unit trusts) held in specified proportions to achieve a specific investment goal. This portfolio is managed (or 'wrapped') according to a specific mandate, and which aligns with your risk profile as an investor.
Benefits:
• Active Portfolio Management of funds. Committee meetings take place quarterly with fund managers, important role players and myself. Here activities on a global, local and political front are scrutinized and their impact on underlying funds determined.
• Changes in Portfolio Managers and Fund Managers are closely observed – the impact thereof will determine if exposure to these funds are increased/decreased.
• In a wrap-fund, if exposure is adjusted, changes happen immediately in all client’s portfolios who are invested in that specific portfolio. This tool eliminates frequent fund switches. Fund switches can be costly and extremely time consuming as changes will not be implemented until necessary forms have been completed, signed off by the investors and submitted from my offices. Client will remain invested until fund switch is finalized thus period in risky product much longer than in a wrap fund.
• Wrap funds thus reduce risk timeously.
• Pro-active approach rather than re-active.
Costs associated with wrap funds:
An additional .29% Management fee is payable annually. CGT payable on disposal.
However, the benefits far exceed the negatives.
