The Investec Balanced Low Equity Portfolio is designed to provide long-term capital growth and income through a cautious investment approach. Managed by Investec Wealth & Investment International, this unit trust is tailored for investors seeking moderate equity exposure combined with a diversified asset allocation.
Key Facts
| Feature | Details |
|---|---|
| Inception Date | 1 July 2008 |
| Assets Under Management | R404 Million |
| Minimum Investment | R3,000,000 |
| Base Currency | ZAR |
| Management Fee | 1.00% p.a. (minimum fee of R10,000) |
| Gross Historic Yield | 7.1% |
| Benchmark | (ASISA) South African Multi Asset Low Equity |
| Fund Manager | Investec Wealth & Investment International |
Investment Objectives and Strategy
The Investec Balanced Low Equity Portfolio aims to achieve a balance between capital growth and income through a diversified investment approach.
Investment Approach
- Top-Down Analysis: The portfolio is managed using a top-down approach, assessing economic conditions and market trends to determine the optimal mix of equities, bonds, property, and cash.
- Bottom-Up Stock Selection: Investment decisions are based on a bottom-up analysis of individual companies. The focus is on selecting blue-chip companies with strong growth potential and reasonable valuations.
- Regulation 28 Compliance: The portfolio adheres to Regulation 28 of the Pension Funds Act, limiting equity exposure to a maximum of 75%. Typically, equity exposure is below 40%, with the remainder allocated to bonds, property, cash, and preference shares.
Performance Overview
The performance of the Investec Balanced Low Equity Portfolio is compared to its benchmark, the ASISA South African Multi Asset Low Equity. Below is a summary of recent performance metrics.
Cumulative Return
| Period | Investec Balanced Low Equity Portfolio | Benchmark |
|---|---|---|
| 1 Year | 11.7% | 9.9% |
| 3 Years | 9.4% | 8.1% |
| 5 Years | 8.3% | 7.6% |
| 10 Years | 6.8% | 6.8% |
| Since Inception | 7.8% | 7.8% |
Calendar Year Returns
| Year | Investec Balanced Low Equity Portfolio | Benchmark |
|---|---|---|
| 2023 | 11.2% | 11.0% |
| 2022 | 6.8% | 1.4% |
| 2021 | 11.6% | 13.5% |
| 2020 | 6.4% | 5.2% |
| 2019 | 6.3% | 8.6% |
Asset Allocation
The portfolio is diversified across various asset classes to mitigate risk and enhance returns.
Asset Allocation Breakdown
| Asset Class | Percentage |
|---|---|
| Domestic Equities | 31.7% |
| Domestic Bonds | 44.2% |
| Domestic Cash | 14.9% |
| Domestic Property | 0.9% |
| Domestic Preference Shares | 3.4% |
| Domestic Alternatives | 4.3% |
Top Holdings
| Holding | Percentage |
|---|---|
| R2037 Government Bond | 10.5% |
| R2035 Government Bond | 9.8% |
| R2030 Government Bond | 8.7% |
| New Gold Issuer Ltd | 6.5% |
| I2033 Government Bond | 5.9% |
| Naspers Ltd | 4.8% |
| Anglo American Plc | 4.5% |
| Firstrand Ltd | 4.2% |
| Standard Bank Group Pref Shares | 3.7% |
| Standard Bank Group Ltd | 3.5% |
Advantages
- Regulation 28 Compliance: Suitable for retirement investments, ensuring adherence to pension fund regulations.
- Cautious Equity Exposure: Limited equity exposure reduces risk, making it a more stable investment compared to equity-heavy portfolios.
- Experienced Management: Managed by Investec Wealth & Investment International, known for their expertise and track record.
- Competitive Fees: The management fee of 1% per annum is reasonable, with a minimum fee of R10,000.
Disadvantages
- High Minimum Investment: The required minimum investment of R3 million may be prohibitive for smaller investors.
- Variable Returns: While generally stable, returns may vary and sometimes fall short of other investment options like fixed deposits.
- No Capital Guarantee: As with most investment funds, there is no guarantee on capital preservation.
Conclusion
The Investec Balanced Low Equity Portfolio is a robust option for investors seeking long-term growth with a focus on stability and income. Its diversified approach and adherence to regulatory guidelines make it suitable for conservative investors, especially those planning for retirement. However, potential investors should consider the high minimum investment and lack of capital guarantee. Overall, it is a solid choice for those looking for a balanced investment strategy with moderate risk.
For more detailed information, visit the Investec Wealth & Investment website.
