Our Leveraged Equity portfolio follows a quantitative long-short leveraged strategy, investing in the most liquid shares on the JSE. The portfolio is constructed by analyzing the relationship between risk factors over various economic and market cycles and then allocations are made into a combination of our four equity factor building blocks, being Value, Quality, Stability and Momentum.
Leveraged portfolios allow you to get a greater exposure to what you’re investing in. Think of it in the same way that you would invest in property. If you wanted to buy a R1 million house, you’d only have to put down a percentage of that amount as a deposit, while still owning the property and reaping the benefts of it’s gain in value respectively. Leveraging investments work the same way; the amount you invest is a percentage of the exposure you get in the market. For this portfolio, the aim is to reach 150% exposure of what you invest. This is also known as gearing.
This portfolio will take long and short positions, meaning investments are made into companies in which the share price is expected to grow, as well as in companies in which the share price is expected to fall, and may also retain amounts in cash or cash equivalents pending reinvestment if this is considered appropriate to maximise returns.
This investment is not suitable for moderate or conservative investors seeking capital stability or preservation.
This portfolio aims to offer maximum equity returns over the long-term, targeting a return of inflation plus 10% over time at the same or moderately more risk the JSE Top 40.
We use a benchmark as a way to compare and measure our performance against another fund. For this portfolio, we are using:
The FTSE/JSE Top 40
Investment Management Fee: 1.2% P/A (excl VAT)
Performance Fee: 20% above benchmark
Transaction Costs: 0.35%
The Total Investment Cost excludes Performance Fees. These are calculated as 20% of any excess return above the stated benchmark and are calculated on a monthly basis
See the factsheet here for more information