New Road BCI Moderate Fund of Funds

The New Road BCI Moderate FoF aims to provide the medium to long term investor with a well-diversified, multi-asset investment. With this fund, the investor might experience moderate short-term volatility; however, the focus is on developing a combination of long-term capital growth and income.

This fund falls within the following ASISA Category:

SA Multi-Asset Medium Equity

Objective

The fund aims to achieve the following objectives:

  • Benchmark: ASISA SA Multi-Asset Medium Equity category average
  • Target Return: South African Inflation (CPI) + 4% over a rolling 5-year term

Strategy

The strategies we employ to achieve the above objectives are:

  • Limit the fund’s total equity exposure to a maximum of 60% of the portfolio’s net asset value, with listed property (limited to 25%) and income instruments comprising the balance.
    (The income component is used to achieve a more stable return profile, because of the yield opportunities on these instruments, while the equity component is used to achieve longer-term capital growth and dividends.)
  • Maintain exposure to both local and offshore instruments, with global allocation forming a maximum of 30%  of the portfolio’s net asset value.
    (We use our foreign investment allowance to obtain global exposure.)
  • Apply a building block approach to asset allocation to maintain strict control of the asset exposures.
  • Construct the local and offshore equity components of the fund by using a core-satellite approach, whereby low-cost passive solutions are used to gain broad market exposure and well-priced actively managed solutions are used to gain exposure to specific strategies, styles, and risk management methodologies.
  • Use predominantly active solutions to construct the income components of the fund.
  • Ensure that the fund complies with Regulation 28.

Holdings

Figure 1 shows the portfolio holdings of New Road BCI Moderate FoF as at 30 June 2020.

Figure 1: New Road BCI Moderate FoF Portfolio Holdings

Asset Allocation

Figure 2 depicts the asset allocation of New Road BCI Moderate FoF as at 30 June 2020.

Figure 2: New Road BCI Moderate FoF Asset Allocation

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