Michael van Rensburg, BComm, Head: Fixed Income Trading
Michael started his career on the Money Market desk of the Department of Post and Telecommunications. As a Money Market Manager his primary functions were the daily management of cash flows and the investment of surplus funds. He was also responsible for the start-up of the Commercial Paper Bill program and the successful implementation of the counterparty credit limits. After three years on the Money Market desk he moved to the Capital Market as a market maker for Telkom long-term debt. He subsequently joined ABSA where he worked as a market maker for their Treasury Division. Prior to joining Old Mutual Asset Managers, Michael worked for Sanlam Asset Managers as head of Fixed Income Trading.
Michael currently heads up Old Mutual Asset Manager's Fixed Income Trading desk. In addition, he also manages the Old Mutual Money Market Fund, the Namibia Money Fund as well as a number of aggressive bond funds.
FUND OBJECTIVES AND FOCUS
Four Plus Secure Fund of Funds aims to provide a total return in excess of rates offered by traditional savings deposits. To achieve this it invests in the bond and money markets. With the focus primarily on money market assets, the risk of capital loss is reduced. Bond exposure is only increased when they offer a high probability of outperforming cash. The fund benefits from the moderate growth opportunities offered by bonds as well as the compounding effect of reinvested income. The duration of the fund will be limited to a maximum of 12 months, adding to the relative capital stability of the fund.
The Fund is suitable for risk-averse investors who need an investment that offers a return in excess of traditional savings deposit accounts. These investors are more concerned about capital preservation than chasing long term capital growth. It also provides a supplement to existing retirement plans and gives smaller investors access to the money and capital markets - previously only available to large and institutional investors.
This is a moderately conservative risk fund (risk rating 2). The fund is exposed to interest rate fluctuations. When rates rise, the bonds held by the fund will fall in value. When rates fall, the bonds held by the fund will increase in value. Risk is reduced by the following:
a) The short term nature of the fund's cash holding reduces its price fluctuations and interest rate risk.
b) The average duration of the assets held by the fund. This is limited to a maximum of 12 months, adding to the relative capital stability of the fund.