- The act that governs unit trusts, CISCA, allows for the use of derivative instruments for the purpose of efficient portfolio management. The ability to make use of derivatives enables the Portfolio Manager to reduce risk and enhance the performance of the fund.
- The ability to make use of derivative instruments will expand the investable universe of the fund, resulting in better issuer diversification and reduced concentration risk. It will also enable the manager to more effectively manage interest rate risk.
- The allowance for the use of derivate instruments will not impact on the objective of the fund, which will still aim to offer a combination of capital growth and high income yields.
- The portfolio may gain exposure to listed and unlisted derivatives which may be used for efficient portfolio management purposes. There are certain risks associated with the use of derivatives, however these risks can be mitigated. If these risks are not well mitigated, this may result in portfolio losses. However, derivatives can also be a great risk management tool to reduce risk and increase returns.
- The ASISA category, benchmark and fees of the fund will remain unchanged.
- Old Mutual Core Conservative Fund: South African - Multi-Asset - Low Equity (maximum 40% equity exposure)
- Old Mutual Core Moderate Fund: South African - Multi-Asset - Medium Equity (maximum 60% equity exposure)
- Old Mutual Core Balanced Fund: South African - Multi-Asset - High Equity (maximum 75% equity exposure)
- Simplifying our investment offering via our product wrapper consolidation
- Online transaction capturing with real-time validation
- Online tools that highlight the value of advice
- Ensuring clients’ investments are relevant in the current and future regulatory environment
- Product and Administration
- Investment and Financial Planner Fees
- Online Accessibility and Transaction Submission
- Fund Characteristics
- General Terms and Conditions
As we prepare for the release of your 2022 tax certificates, we would like to encourage you to review our digital channels in order to retrieve your 2022 tax certificates. Click on Login in at the top right of this page, to access or create a secure login. When your 2022 tax certificates become available your retrieval process will be easier and faster.
You can download the Old Mutual App via the various App stores depending on your model of mobile phone and then access/retrieve your tax certificates, when available. Visit our Digital Solutions page to download the app.
Send us a WhatsApp! You can access your tax certificates via WhatsApp. Simply save the number 0860 933 333 and say "Hi" and you will receive the options available to you.
You will be notified digitally via either an SMS, email or an in-app notification once your tax certificates are available for you to retrieve.
Retrieving your tax certificates has never been easier!
Benchmark change for the Old Mutual Maximum Return Fund
The Old Mutual Maximum Return Fund aims, as its name implies, to maximise real returns over the long term. The mandate of the Fund is fully flexible, allowing exposure to both local and global asset classes (cash, bonds, property, equity securities). The Fund will on average, have a high exposure to growth assets, predominantly equity securities, given that this asset class has delivered the highest real returns over the long term. The Fund has a recommended investment horizon of 10 years.
Please be advised that effective 30 September 2022, the benchmark of the Old Mutual Maximum Return Fund will change.Download pdf
Please be advised that due to the discontinuation of the FTSE/JSE Gold Index, we have changed the benchmark of the Old Mutual Gold Fund (previously 70% FTSE/JSE Gold Index + 30% FTSE Gold Mines Index Series). The new composite benchmark consists of a 70% customised gold index + 30% FTSE Gold Mines Index Series.
WHY HAS THE BENCHMARK CHANGED?
As of 23 March 2021, the FTSE/JSE Gold Index, which formed part of the Old Mutual Gold Fund’s composite benchmark, was discontinued by the Johannesburg Stock Exchange (JSE). The gold shares that previously comprised the FTSE/JSE Gold Index are now constituents of the FTSE/JSE Precious Metals & Mining Index only.
EXEMPTION GRANTED FOR THE IMPLEMENTATION OF A CUSTOMISED BENCHMARK
The Financial Sector Conduct Authority (FSCA) has approved an exemption that enables the Old Mutual Gold Fund to retain its current exposure levels to the remaining 5 gold shares by creating a customised gold index, as part of the fund’s benchmark, which consists of the gold shares included in the FTSE/JSE Precious Metals & Mining Index. The customised gold index will have maximum limits that fluctuate in accordance with the maximum weightings of the shares in the FTSE/JSE Precious Metals & Mining Index.
It is important to note that this change to the fund’s benchmark will not impact the way the fund is managed. The implementation of a customised benchmark ensures that the fund remains compliant with the regulations of the Collective Investment Schemes Control Act 45 of 2002 (CISCA).
Please be advised that effective 30 June 2022, the benchmark of the Old Mutual Multi-Managers Maximum Return Fund of Funds will change from 90% FTSE/JSE Capped Shareholder Weighted Index, 10% MSCI All Country World Index to 50% FTSE/JSE Capped Shareholder Weighted Index, 50% MSCI All Country World Index.
WHY WILL THE BENCHMARK BE CHANGING?
As its name implies, the Old Mutual Multi-Managers Maximum Return Fund of Funds aims to maximise real returns over the long term. The mandate of the fund is fully flexible, allowing investment in both local and global asset classes. The fund will on average have a high exposure to growth assets, predominantly equity, given that this asset class has delivered the highest real returns over the long term. It therefore has a recommended investment horizon of 10 years.
As the objective of the fund is to maximise returns over the long term, and given the fully flexible nature of the mandate, we believe that a composite benchmark comprising 50% global equity exposure and 50% local equity exposure would better represent the long-term asset allocation of this fund.
The benchmark change does not have an impact on the management of the portfolio, which will continue to seek exposure to investment opportunities across regions and asset classes to maximise returns for investors.
Old Mutual Maximum Return Fund Ballot
Please be informed that following a successful ballot, the Financial Service Conduct Authority (FSCA) approved the structural and investment policy change of the Old Mutual Maximum Return Fund of Funds. The fund will going forward fulfil its mandate by investing directly in a combination of SA and global equity and non-equity securities, as well as potential limited exposure to participatory interests in Collective Investment Schemes. The fund will no longer gain exposure into underlying Collective Investment Schemes only.
Old Mutual Bond Fund Ballot
If you are invested in the Old Mutual Bond Fund, we are pleased to inform you that we successfully balloted clients to amend the investment policy of the fund to provide for the use of listed and unlisted derivatives, and the ballot outcome has been approved by the Financial Sector Conduct Authority (FSCA). If you need more information regarding any of the above or your statement, contact your financial planner, call our service centre at 0860 234 234 or email email@example.com.
The Old Mutual Bond Fund invests in the South African bond market. In this environment we invest in both SA government bonds as well as SA non-government bonds. The fund’s investment in SA non-government bonds was historically restricted due to the inability to use derivative instruments despite its allowance in the Collective Investment Schemes Control Act (CISCA). The inclusion of derivatives in the fund’s mandate, will allow us to make greater use of SA non-government debt exposures to add additional returns to the fund. While derivatives are generally considered to be high risk instruments, our use of derivatives would primarily be to manage interest rate risk in the fund relative to the fund’s benchmark. The change will not affect the aim or return objectives of the fund.
Impact of the proposed change on you, as an investor
Below is an extract from the Portfolio Manager on why we need to introduce derivatives to this fund:
The absence of using derivatives is a major limitation in managing the Old Mutual Bond Fund and is also directly linked to our ability to add credit risk to the fund. In the past when credit risk was first introduced to the domestic bond market, these instruments were mostly medium to longer term fixed rate instruments. At the time the fund had a fixed rate benchmark so these instruments were a good match. However, over the past decade, as the market became more comfortable with credit as an asset class, and linked to the development of the domestic SWAP market, we had a transition from the issuance of fixed rate longer term credit to short term (predominantly 3 years) floating rate credit. Due to the long dated nature of the fund’s benchmark and the inability to trade derivatives, we cannot consider buying any floating rate credit instruments for this fund.
If we could use derivatives, we could buy a floating rate instrument earning a yield pickup. We would then use an interest rate swap to convert the floating interest rate exposure to a fixed interest rate exposure that is more aligned to the fund’s benchmark. Because we cannot trade derivatives (in particular interest rate swaps) we have limited ability to add credit risk (additional yield) to the portfolio. At the moment fixed rate bonds are predominantly issued by SOEs and selected banks, which limits our ability to add issuer diversification to the fund.
Thus our motivation for adding derivatives to the fund is aimed at improving our ability to add (and diversify) credit risk to the portfolio and to effectively manage interest rate risk.
KEY DRIVERS OF RETURNS
Currently, the primary tool at our disposal to add returns to the Old Mutual Bond Fund is via interest rate exposure, which detracted from returns over the past three years as a result of declining interest rates. In addition, the tools at our disposal to mitigate some of the return volatility from interest rates (i.e. trading derivatives and floating rate credit) are currently limited to investing in implicit or explicit government guaranteed debt. This exposes the fund to unnecessary single issuer risk and does not provide the diversification we need from a credit perspective. We believe that the addition of the ability to make use of derivatives will enhance the ability of the fund to fulfil its mandate by taking on more diversified credit risk exposure in order to enhance the yield of the fund.
NEW FUND RANGE
As part of our fund enhancements we launched two new funds on 28 February 2018: Old Mutual Equity Fund and Old Mutual Core Moderate Fund. The Old Mutual Equity Fund is a rand-based South African general equity fund that can invest 30% offshore. It will be managed by the same team who manages the Old Mutual Investors’ Fund, the longest running unit trust in South Africa.
The Old Mutual Core Moderate Fund is a passive balanced fund and, as communicated last quarter, will complete the passive multi-asset range as per below:
Fund Name and ASISA category:
OLD MUTUAL MID & SMALL CAP FUND
The investment policy of Old Mutual's Mid and Small Cap Fund allows exposure to a range of shares in the mid and small indices. This excludes the 40 largest stocks listed on
the FTSE/ALSI All Share index. Due to recent changes to the way in which the JSE calculates certain indices some mid cap shares were unintentionally excluded from the
investible universe of the fund.
We have engaged with the Financial Services Board (FSB) to update the fund's investment policy so that the manager can continue to manage the fund as intended. This will
enable the fund to continue to gain exposure to the full range of shares in the mid and small cap indices. The 40 stocks in the Large Cap Index will be excluded from the
investment universe of the fund.
Old Mutual Unit Trusts has set out three retail priorities for 2019 in order to make our clients the epicentre of our investment world. One of the priorities we would like to highlight now is: making sure we have a fit-for-purpose product suite and our aim to optimise operational efficiencies.
The alignment of Old Mutual Unit Trusts to the same administration platform that administers Old Mutual Wealth not only assists in optimising operational efficiencies but it also creates an experience that facilitates the following benefits:
Additional details are contained in the Q & A document, which also covers the following platform transfer topics: