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-0.57  /  -0.36%


NAV on 2021/09/17
NAV on 2021/09/16 158.287
52 week high on 2021/06/08 159.917
52 week low on 2020/10/07 145.117
Total Expense Ratio on 2021/06/30 0.88
Total Expense Ratio (performance fee) on 0
Incl Dividends
1 month change 0.59% 0.59%
3 month change 0.09% 2.14%
6 month change 3.98% 8.43%
1 year change 3.96% 12.93%
5 year change -0.11% 8.31%
10 year change -0.21% 7.78%
Price data is updated once a day.
Click and drag to zoom in on timeline.
  • Sectoral allocations
Derivatives -3.74 -0.05%
Gilt 18.23 0.26%
Liquid Assets -681.73 -9.82%
SA Bonds 7608.73 109.61%
  • Top five holdings
AIRNAM04 18.23 0.26%
DERIVATIVB -3.74 -0.05%
  • Performance against peers
  • Fund data  
Management company:
Momentum Collective Investments Limited
Formation date:
ISIN code:
Short name:
South African--Interest Bearing--Variable Term
BEASSA All Bond index


0860-111-899 (Client Services)

  • Fund management  
Ian Scott
Thamage Lesito

  • Fund manager's comment

Momentum Bond comment - Sept 18

2018/12/03 00:00:00
Economic overview
An escalation in international trade tensions, a gradual erosion of democratic standards in Europe, rising world debt levels, tighter global financial conditions and geopolitically driven oil price shocks have dampened optimism around global economic prospects. The timing, degree and effect of previous fiscal and monetary interventions by the major central banks and varying progress in fiscal and monetary exit strategies have further given rise to a desynchronisation in global growth. Tell-tale signs of a late-cycle phase are emerging in the United States. The fading effect of the fiscal boost, higher expected interest rates and onerous tariffs are likely to trigger a downswing in 2020. Meanwhile, internal politics threaten Europe's growth outlook, as it transitions from mid to late cycle. If the newly formed anti-establishment coalition government in Italy fails to cooperate with European authorities, contagion effects could ripple throughout the bloc.
Protectionist policies and diminishing liquidity have generated uncertainty in emerging markets (EM), although they are, in general, far better positioned today to withstand external shocks. Though South Africa (SA) has been unfairly categorised within the latest EM grouping in terms of economic mismanagement, the country does exhibit some vulnerabilities, which stack up relatively poorly compared to other EMs. Nevertheless, unless there is a significant fiscal disappointment or further unconditional guarantees allocated to state-owned enterprises, sovereign ratings are likely to remain steady into the end of the year. A tepid near-term growth environment and a non-threatening inflation trajectory in SA point to the start of a shallow interest rate hiking cycle in due course.
Market overview
Fixed income presented a challenge for global asset allocation decisions but managed to post a modest gain for the quarter. Firm growth and rising inflation in the US have put upward pressure on bond yields in global and emerging markets as the FED hiked rates in September this year (and is expected to do so again in December). Liquidity in growing economies is slowly thinning with tighter G3 monetary conditions finding its way into these markets. A build-up of trade tensions between the US and its major trading partners supported a flight to safety of financial flows to the US Dollar, prompting general weakening in currencies throughout global markets. The recent Rand weakness unfortunately also reflects contagion fears stemming from idiosyncratic risks in a handful of emerging markets.
Previously, we highlighted the upside to domestic growth if sustained by foreign direct investment. Although there is a sense of greater political stability domestically, a slow reform agenda will continue to be a drag on growth. The country is likely past the peak of consumer vulnerability, but corporates still face headwinds that could delay fixed investment opportunity in the country. A shallow interest rate hiking cycle is anticipated by the SARB as they continue to urge inflation expectations closer to the midpoint of the target band of 3%-6%.
It is anticipated that weaker growth outcomes could delay the first interest rate hike, which is expected to occur by the end of the first quarter in 2019. The upcoming medium-term budget policy statement in October also could present risk to the 2019 outlook in South Africa. The ALBI performed better over the period, returning 0.8% when compared to the previous quarter. The cash benchmark, STeFI returned an impressive 1.760/0 overthe third quarter in 2018. Inflation-linked bonds fared betterthis quarterthan last returning 0.48%.
Portfolio overview
SA Government Bonds still remain an attractive asset in fixed income markets globally. As volatility returns to the markets, our position in relative value strategies has contributed to the outperformance over the benchmark in the period under review. Maintaining the focus on long-term fundamentals and fair value assumptions through the cycle, the portfolio continues to benefit from investments with rewardable risk premia.
  • Fund focus and objective  
In order to achieve these objectives, the investments normally to be included in the Momentum Bond Fund will comprise a combination of securities, non-equity securities, gilts, semi gilts and assets in liquid
form. The portfolio will be limited to a combination of gilts and interest bearing securities (including loan stock, semi-gilts financially sound debentures, debenture bonds and notes), cash, and any other assets
of a similar nature that offer high returns on capital and income and any other securities that the Act or the Registrar may, from time to time allow, all to be acquired at fair market prices.
The manager may from time to time invest in participatory interests or any other form of participation in portfolios of collective investment schemes or other similar collective investment schemes as the Act may allow from time to time, and which are consistent with the portfolio's investment policy. Where the aforementioned schemes are operated in territories other than South Africa, participatory interests or any other form of participation in portfolios of these schemes will be included in the portfolio only where the regulatory environment is, to the satisfaction of the manager and the trustee, of sufficient standard to provide investor protection at least equal to that in South Africa.

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