CORONATION INTERNATIONAL GROWTH FUNDThis fund is in the international sector. It has 604 unitholders and assets under management of R479.1-million. Launched in August 1997, it is managed by Anthony Gibson for Coronation Unit Trusts
OBJECTIVE: To be as fully invested as possible in a portfolio of offshore investments with the base currency in US$, and to achieve investment returns that exceed the Morgan Stanley World Index in dollar terms. Converted into rands, the returns should exceed all SA equity indices over the long term.
TARGET MARKET: Investors who wish to diversify their portfolio globally.
CHARGES (incl VAT): Initial: 5.46%; Compulsory: 0.75%; Annual service fee: 1.14%.
MINIMUM INVESTMENT: Lump sum: R5 000; monthly: R500.
PAST PERFORMANCE (per Micropal):
JSE all-share index: -31.7%
Sector average: 14%
Performance is calculated on a buy-to-sell basis with income reinvested.
PAST TWO INCOME DISTRIBUTIONS: March 1998: 17.32c (59% interest; 41% dividends). September 1998: 11.19c (84% interest; 16% dividends).
TOP 10 HOLDINGS: Adelphi Europe Inc; The Eureka Fund Ltd; FLA Ltd; Lancer Inc; Olympus (this fund only has five holdings)
TOLL-FREE: 0800 221 177
ABOUT THE FUND MANAGER
EXPERIENCE: Has 20 years investment experience. Has been with Coronation Asset Management for five years and is the chief investment officer.
INVESTMENT ATTITUDE: The fund is a predominantly US$ based multi-manager equity fund. The criteria we have applied in seeking out fund managers include an exemplary past performance track record, a focused approach to share selection, and a clearly defined strategy to protect downside risk. We take comfort in knowing these fund managers have a significant part of their own assets invested alongside our funds. The rand component of the fund is invested in money market assets with durations of 0 to 3 years. As a result this fund provides the security of a dollar-based return, with downside protection, combined with no SA equity risk.
VIEW ON PAST PERFORMANCE: The fund was invested predominantly in cash during this period of volatility. It therefore performed well as a result of good asset allocation rather than stockpicking.
THE FUTURE: We believe the long-term prospects for the rand do not look promising. The appointment of focused fund managers, who excel at seeking opportunities as well as protecting downside risk, combined with our view on the rand, will ensure this fund will provide returns in excess of SA equity indices. It is our intention to change this fund to a fund of funds by December 1, provided existing unitholders approve.
The fund has performed very well compared with its peers, mainly as a result of its high local and overseas cash weighting in the current market volatility. The fund is planning to change to an equity fund of funds by the end of the year. When a fund's structure changes, investors should watch developments closely since performance could be affected. Past performance becomes an even less reliable indicator of future prospects, but the quality of the management team will be very important. This fund manager is considered one of the best in the industry and the fund should remain one to look out for.
Lucienne Fild 10/98