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Foord Conservative Fund

Investment Objective

The fund aims to achieve net-of-fee returns in excess of CPI + 4% over rolling three-year periods, while emphasising capital preservation over the short term. The portfolio is managed to comply with the statutory investment limits set for retirement funds in South Africa (Regulation 28).

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Investor Profile

Given the fund's maximum 60% equity investment restriction, the fund is appropriate for conservative investors who are close to, or typically in, retirement and whose time horizon does not exceed five years. These investors may therefore seek lower levels of investment volatility and risk of short-term loss than those provided by a less conservative balanced fund.

Performance history   Info

Fund Characteristics

Benchmark

The annual change in the SA Consumer Price Index (CPI) plus 4%

significant restrictions

Maximum equity exposure of 60%; maximum offshore exposure of 25%; complies with pension fund investment regulations (Regulation 28).

Income Distributions

End-February and end-August each year.

Income Characteristics

Typically more than double that of the FTSE/JSE All Share Index dividend yield. The income yield is affected by the level of performance fees accrued.

Portfolio Orientation

Typically a medium to low weighting in JSE shares and includes exposure to listed property securities, bonds, money market instruments and foreign assets as permitted by prudential investment regulations.

Foreign Assets

Foreign asset exposure is obtained via the Foord International Fund (FIF) and Foord Global Equity Fund (FGEF). FIF is a conservative, multi-asset class fund domiciled in Luxembourg, while FGEF comprises a portfolio of global shares and cash and is domiciled in Singapore. Both funds are priced in US dollars.

Risk of loss

Medium in periods shorter than six months. Low in periods greater than one year.

Time Horizon

Shorter than 5 years

Suitable Investors

Pension funds, pension fund members, holders of contractual savings products, medium-term investors and those investors who require the asset allocation decision to be made for them, within prudential investment guidelines. The portfolio would be appropriate for conservative investors that are close to, or typically in, retirement and whose time horizon does not exceed five years.

Fee Structure

No initial fees are levied. The annual management fee is a performance fee with the daily charge rate adjusted up or down based on the fund’s one year rolling return relative to that of its benchmark. The fee at benchmark is 1.0% plus VAT, the performance fee sharing ratio is 10% (over- and under- performance) plus VAT. A minimum fee of 0.5% plus VAT applies. No fees are charged when the annual net-of-fee return on the fund falls below zero.

Fund Manager

Minimum Investment

R50 000 lump sum or R1 000 per month