Welcome to the November 2022 edition of FC Viewpoint.

IN THE NEWS:

• The JSE All Share Index increased from 65 539 on 21 October 2022 to 72 577 on Friday 18 November 2022. This is more than 10% over the past 30 days.
• 1 US Dollar will cost you R17.31; 1 Pound = R20.50 and 1 Euro = R17.82.
• Annual consumer price Inflation is at 7.5%.
• The prime lending rate in SA is 9.75% per annum.
• The price of Oil is $86.70 per barrel.

SLIDE OF THE MONTH: Asset Class Returns (SA Rands)

The table above again emphasises the importance of a well-diversified portfolio. Global equity as an example was the best-performing asset class over 5, 10 and 15 years, but one of the worst performers in 2022. From a farmer’s perspective, when the price of sheep is low, you should buy more sheep and hold back on selling any.

Global risk assets staged a positive rebound in October on expectations that major central banks could start to taper their rate hikes before year-end. Inflation, and how central banks will manage rates, remain front of mind for many investors.

Global cash remains the top-performing asset class in the year to date in a global market of heightened geopolitical risks, an energy crisis and ongoing uncertainty.

We continue, with our fund focus, and this month we look at the Allan Gray Bond Fund.

The Bond Fund’s goal is to deliver returns that exceed inflation and cash over the long term, without taking on undue risk.
About the Fund

• The Fund invests in South African interest bearing securities. Securities include national government, parastatal, municipal, corporate bonds and money market instruments. The Fund price is sensitive to interest rate movements because of the long-term nature of the Fund’s investments. The duration of the Fund may differ materially from the benchmark. The Fund is managed to comply with investment limits governing retirement funds.
• ASISA unit trust category: South African – Interest Bearing – Variable Term
• The Bond Fund’s goal is to deliver returns that exceed inflation and cash over the long term, without taking on undue risk. The Fund’s benchmark is the FTSE/JSE All Bond Index.
• Allan Gray try to balance credit risk, duration risk and liquidity risk when selecting investments. We target total returns for investors rather than trying to mirror the returns of the FTSE/JSE All Bond Index. When we cannot find value in the bond markets, our portfolio will be weighted towards cash to get better returns.

Performance

TO CONCLUDE

Let us help you to build a financial plan to achieve your financial goals. The best time to start saving, plan your financial affairs and building wealth is now.

Wealth regards,

Fanie Jansen Van Vuuren CA (SA), CFP®

Director: FC Wealth and Investments (Pty) Ltd

E: fanie@fcfin.co.za  |  T: 083 384 5868

W: www.fcfin.co.za