The fund was launched in August 2018 to invest in listed securities that derive their value from underlying real assets and targets CPI +4% over a full investment cycle. Investments can be via REITs, investment trusts or specialist companies with a focus on physical assets.
 

The fund:
  • Offers attractive yields from long-term cashflows with significant inflation protection

  • Is managed by a team with proven experience in this area

  • Benefits from diversification and lower volatility than traditional equity portfolios

Introducing Sanlam Real Assets Fund

August 2019 - Latest commentary

 

Transparency - August marks the first year anniversary for the Sanlam Real Assets Fund. Since inception the fund has delivered +12.3% against the MSCI World +1.4% and the FTSE 100 -0.3%. Whilst in its infancy, the fund has exhibited strong capital preservation characteristics during a time when uncertainty and volatility have been on the rise. The Real Assets Fund maximum drawdown since inception is -3.4% vs the MSCI World and FTSE 100 at -18.1% and -12.7% respectively. Over the last 12 months, two prevailing narratives have steered markets - US trade wars and Brexit. Today both of these issues remain unresolved and as it stands the political landscape has made little progress.

In the UK, new PM Boris Johnson has initiated a suspension of Parliament in an attempt to accelerate negotiations and agree a deal before the end of October. Meanwhile in the US, President Trump's combative trade rhetoric continued to weigh on equity markets and the month ended with the S&P 500, MSCI World, and FTSE 100 indices down -1.58%, -2.05% and -4.08% respectively. The Sanlam Real Assets Fund was up +1.49% over the month.

During the month of August, the fund saw positive contributions from infrastructure, renewable energy and property. Other alternatives detracted from performance. A number of asset acquisitions in the companies came to a close over the period, including a music catalogue, a waste-to-energy project, anaerobic digestion plants, a supermarket and a student accommodation development. The background for renewables in the UK continued to look favourable despite a brief wind farm power outage following lightning strikes. Crown consent on 7 existing projects was granted to expand capacity, amounting to levels in excess of 2.8GW.

Activity - We continued to deploy inflows to the fund in the open market. We also participated in one capital raise during August, the proceeds of which are to go towards acquiring music catalogues.

Previous months’ commentaries are contained within the fund factsheets.

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Fund disclaimer

Past performance is not a guide to future performance. Do remember that the value of an investment and the income generated from them can fall as well as rise and is not guaranteed, therefore, you may not get back the amount originally invested and potentially risk total loss of capital.

The Fund has holdings which are denominated in currencies other than sterling and may be affected by movements in exchange rates. Consequently the value of an investment may rise or fall in line with the exchange rates.

The Fund may invest in derivatives for the purposes of efficient portfolio management and hedging only . There is a risk that losses could be made on derivative positions or that the counterparties could fail to complete on transactions. The Fund's expenses are charged to capital. This has the effect of increasing dividends while constraining capital appreciation. 

Part of the fund may invest in fixed income securities. The government or company issuer of a bond might not be able to repay either the interest or the original loan amount and therefore default on the debt. This would affect the credit rating of the bond and, in turn, the value of the fund. Investment in bonds and other debt instruments (including related derivatives) is subject to interest rate risk. If long-term interest rates rise, the value of your shares is likely to fall.

Please agree to proceed. By doing so you agree that you have read and understood the foregoing disclaimer and confirm that you are a professional investor.

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The value of investments and any income from them can fall and you may get back less than you invested.