Tuesday, 19 February 2013 - 20:00
Betting on last year?s winner
There is always a continuous search for excellent performing funds in which to invest. But can we just go by investing into previous year’s top performing fund? Is past performance and indication of future performance? Somewhere on most funds’ fact sheet the following is stated: “Past performance is not necessarily indicative of future results” or something to a similar affect.
The table below shows the Top 10 performing General Equity funds over the last 5 years. The oldest share class was used and the fund needed to exist for the full calendar year to be included.
Over the past 5 years 35 funds were at one point in the Top 10. 21 of those funds were only once in the Top 10, 13 funds were twice and only one fund appeared three times. The Foord Equity fund was the only fund that was in the Top 10 for three consecutive years, from 2010 to 2012.
The question we then asked is should a fund appear in the Top 10, does it subsequently remain in the top quartile or does it drop to the lower quartiles? The table below indicated the quartile rankings of the Top 10 funds of 2008 over the following 4 years.
The following year, only one fund was able to remain in the top quartile. Most of the funds dropped to the 3rd quartile. By 2012, 5 years later, half the funds that were in the Top 10 in 2008 were in the bottom quartile.
If one is not able to predict the future winner from just past performance, how does an investor select a fund to invest into?
Rather than focusing on which funds was at the top of a certain year more time needs to be taken to understand the investment philosophy and process of the manager. If this is understood a better judgement call can be made to invest into the fund.
By understanding the investment process of the fund manager you would have a better understanding of which market conditions the fund will perform and underperform.
Instead of only focusing on the top performing manager we also ascertain how consistent the fund manager’s performance is, aiming for a fund to be consecutively in the top two quartiles rather than the best performing fund over just one period.
With the end of the financial year in sight, this is a friendly reminder to top up your retirement annuity.
As always we are available for any questions.
021 914 4966
Tue, 19 Feb 2013
South Africa's rand softened against the dollar on Tuesday amid fears of more trouble in the mining sector after Anglo American Platinum's said workers at its Rustenburg operations were likely to stay away following violence the previous day.. . .
World Markets (Spot Prices)
|JSE Top 40||17:00||36328.85||235.00||0.65%|
|JSE Indust 25||17:00||42290.60||292.00||0.70%|
|Rand / Dollar||19:59||8.8543||-0.0306||-0.34%|
|Rand / Pound||19:55||13.6181||-0.1007||-0.73%|
|Rand / Euro||19:55||11.8513||-0.0185||-0.16%|
|Rand / NZD||19:58||7.5126||0.0053||0.07%|
|Rand / AUD||19:55||9.1703||0.0075||0.08%|
|Yen / Dollar||19:59||93.5100||-0.3760||-0.40%|
|Euro / Dollar||19:55||0.7468||-0.0019||-0.25%|
|Dollar / Euro||19:59||1.3386||0.0033||0.25%|
|Pound / Dollar||19:55||0.6484||0.0022||0.34%|
Click here for the Sharenet Spot Price page
The JSE Today
* Includes all listed instruments on the JSE
|Index Name||RP||Move||% Move|
|Financial & Ind. 30||46,166.00||348.00||0.76%|
|Oil & Gas ||30,024.00||122.00||0.41%|
|Oil & Gas Producers ||16,143.00||65.00||0.41%|
|Basic Materials ||29,408.00||129.00||0.44%|
|Forestry & Paper ||20,381.00||298.00||1.49%|
|Industrial Metals ||29,237.00||135.00||0.47%|
|General Industrials ||114.00||1.00||1.76%|
|Consumer Goods ||44,893.00||561.00||1.27%|
|Automobiles & Parts ||7,561.00||16.00||0.21%|
|Health Care ||55,482.00||517.00||0.94%|
|Index Name||RP||Move||% Move|
|Food Producers ||68,741.00||-889.00||-1.28%|
|Personal Goods ||736.00||16.00||2.29%|
|Consumer Services ||81,789.00||-571.00||-0.69%|
|General Retailers ||63,711.00||-800.00||-1.24%|
|Travel & Leisure ||5,079.00||2.00||0.05%|
|Support Services ||2,362.00||-22.00||-0.94%|
|Non-life Insurance ||48,236.00||599.00||1.26%|
|Life Insurance ||27,105.00||253.00||0.94%|
|General Financial ||2,844.00||-2.00||-0.10%|
|SHARIAH TOP40 ||3,554.00||25||0.72%|
|FTSE/JSE SHARIAH ALL||3,662.00||21||0.60%|
|FTSE JSE Fledgling ||5,979.00||-23||-0.39%|
|FTSE/JSE Alt X ||806.00||23||2.97%|
|SA LISTED PROPERTY ||519.00||1.09%|
|CAPPED PROPERTY ||420.00||0.79%|
|FTSE/JSE RAFI 40||8,336.00||55||0.67%|
|Capped Top 40||19,122.00||116||0.61%|
|Capped All Share||20,593.00||108||0.53%|
|JSE TABACO ||5,937.00||55||0.94%|
Click here for the Sharenet Index Summary page
Latest Consensus Changes**
|IPL||IMPERIAL HOLDINGS LTD||HOLD||21/01/2013|
|BIL||BHP BILLITON PLC||HOLD||21/01/2013|
|TRU||TRUWORTHS INTERNATIONAL L...||SELL||21/01/2013|
|AMS||ANGLO AMERICAN PLATINUM C...||HOLD||21/01/2013|
|ANG||ANGLOGOLD ASHANTI LIMITED||HOLD||21/01/2013||
|Expected||Company Name||Fin. Date|
|20/02/2013||CAPITAL||December 2012 (Final)|
|20/02/2013||CAXTON||December 2012 (Interim)|
|20/02/2013||CAXTON6%CPP||December 2012 (Interim)|
|20/02/2013||JDG CONV||December 2012 (Interim)|
|20/02/2013||JDGROUP||December 2012 (Interim)|
|SHOPRIT 6%||15/02/2013||01/03/2013||11/03/2013||R 0.0600|
|SHOPRIT 5%||15/02/2013||01/03/2013||11/03/2013||R 0.0500|
|SHPRT 2ND5||15/02/2013||01/03/2013||11/03/2013||R 0.0500|
|SHPRT 3RD5||15/02/2013||01/03/2013||11/03/2013||R 0.0500|
|AWT||Awethu Breweries Ltd.||20/02/2013||Confirmed|
|CUL||Cullinan Holdings Ltd.||22/02/2013||Confirmed|
|CULP||Cullinan Holdings Ltd.||22/02/2013||Confirmed|
|CUP2||Cullinan Holdings Ltd.||22/02/2013||Confirmed|
|CND||Conduit Capital Ltd.||22/02/2013||Confirmed||
Stock Exchange News Service
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