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Skip Navigation LinksCore Funds

Satrix Property Index Fund

Investing in bricks and mortar has been around for as long as people have had access to capital. But investing in one property has disadvantages: all your eggs are in one basket, and your property may stay on the market for longer than you wish before you get your asking price. This listed property fund addresses these concerns by diversifying across liquid property instruments.

This is a specialist index tracking fund tracking the performance of the FTSE/JSE SA Listed Property Index. It is best suited to investors with a long-term investment horizon (more than 5 years). For more information contact your financial adviser or broker.

Quick Facts About The Fund*

Satrix Property Index Fund

Launch Date: August 2012
Fund Size: R988.3 million
Benchmark: FTSE/JSE SA Listed Property Index (J253)
Time Horizon: 5 years+
*As at 31 August 2017
Risk Profile: Aggressive
Fund Classification: SA - Real Estate - General
Min Investment Amount: Lump sum: R10 000 | Monthly: R500
Total Expense Ratio (TER): 0.51%
Launch Date: August 2012
Fund Size: R998.3 million
Benchmark: FTSE/JSE SA Listed Property Index (J253)
Time Horizon: 5 years+
Risk Profile: Aggressive
Fund Classification: SA - Real Estate - General
Min Investment Amount: Lump sum: R10 000 | Monthly: R500
Total Expense Ratio (TER): 0.51%
*As at 31 August 2017

Fund Strategy

We believe that the benchmark choice and resulting returns form the most important elements of an equity strategy - by investing in a passive vehicle the returns to investment strategies are known. By applying a full replication strategy there is no risk of deviation from the chosen benchmark.


Cumulative Growth Over Time

Performance

Annualised Total Return as at 31 August 2017 on a rolling monthly basis
Retail Class Fund (%) Benchmark (%)
1 year 8.74 9.40
3 year 12.67 13.02
5 year 11.05 11.65
Since inception 12.04 12.66

Annualised return is the weighted average compound growth rate over the period measured
Highest and lowest annual returns over since inception
Highest Annual % 26.63
Lowest Annual % -0.89

Minimum Disclosure Document (Fund Fact Sheet)

Cumulative Growth Over Time

Satrix Property Index Fund
FTSE/JSE SA Listed Property Index (J253)

Source of graph : Morningstar and Sanlam Investments

This graph illustrates how an investment of R100 would have grown had you invested for the time period displayed. Like everything in life, all investments can change and come with some degree of risk. That’s why we need this disclaimer, to tell you that past performances are not necessarily a guide to future performances, and that the value of investments/units/unit trusts may go down as well as up. The performance shown by this graph happened in the past and is not guaranteed. The performance is calculated by taking into account initial and ongoing fund manager fees and assumes that you reinvested all the income earned by the fund over this period.

The other line on the graph is for the performance of the designated benchmark of the fund – normally either an index or other funds in the industry that are comparable to the fund you’ve chosen.

The Manager has the right to close the portfolio to new investors in order to manage it more efficiently in accordance with its mandate. The actual fund performance can be viewed on the Minimum Disclosure Document. Annualised return is the weighted average compound growth rate over the period measured.

1. GrowthPoint 18.15%
2. Redefine 14.28%
3. New Europe Property Investments 10.41%
4. Resilient 9.02%
5. Hyprop 7.74%
6. Fortress Income Fund 7.02%
7. Fortressa 5.26%
8. Rockcastle Global Real Estate 3.77%
9. SA Corp Real Estate 3.60%
10. Vukile 3.20%
Equity Retail REITs
Real Estate Holding & Development
Equity Industrial & Office REITs
Equity Diversified REITs
Cash and Money Market Assets
1. GrowthPoint 18.15%
2. Redefine 14.28%
3. New Europe Property Investments 10.41%
4. Resilient 9.02%
5. Hyprop 7.74%
6. Fortress Income Fund 7.02%
7. Fortressa 5.26%
8. Rockcastle Global Real Estate 3.77%
9. SA Corp Real Estate 3.60%
10. Vukile 3.20%
Application form: Satrix Individual Investors (new investors only) ENG
Application form: Satrix Tax-Free Unit Trusts (new investors only) ENG

View more Satrix forms

Helena Conradie

Chief Executive Officer - Satrix

With a CFA and multiple degrees in Maths and Applied Maths, Helena clearly knows numbers. She started in a small start-up investment team, cut her teeth as a statistical research officer at Sanlam Life and also worked on the creation of Sanlam’s linked-product company, now known as Glacier. Since rejoining Sanlam Investment Management in 2000, Helena has built up a smart-thinking team that manages the largest equity portfolio of exchange traded funds (ETFs) in South Africa. They also have more than R30 billion in assets under management. That's quite a number.

Helena Conradie

Chief Executive Officer - Satrix

With a CFA and multiple degrees in Maths and Applied Maths, Helena clearly knows numbers. She started in a small start-up investment team, cut her teeth as a statistical research officer at Sanlam Life and also worked on the creation of Sanlam’s linked-product company, now known as Glacier. Since rejoining Sanlam Investment Management in 2000, Helena has built up a smart-thinking team that manages the largest equity portfolio of exchange traded funds (ETFs) in South Africa. They also have more than R30 billion in assets under management. That's quite a number.

Traditional Investing (when you invest via a Financial Adviser or other)

Retail Class (%)

Advice initial fee (max.) N/A
Manager initial fee N/A
Advice annual fee (max.) 1.14%
Manager annual fee 0.51%
Total expense Ratio (TER) 0.50%
Transaction Cost (TC) 0.06%

Advice fee | Any advice fee is negotiable between the client and their financial advisor. An annual advice fee negotiated is paid via a repurchase of units from the investor.

The portfolio manager may borrow up to 10% of the market value of the portfolio to bridge insufficient liquidity. This fund is also available via certain LISPS (Linked Investment Service Providers), which levy their own fees.

Total Expense Ratio (TER) | The Total Expense Ratio (TER) is the charges incurred by the portfolio, for the payment of services rendered in the administration of the CIS. The TER is expressed as a percentage of the daily NAV of the CIS and calculated over a period of 1 year. The TER is calculated from 01 July 2016 to 30 June 2017. A higher TER does not imply a poor return nor does a low TER imply a good return.

The Transaction Cost (TC) is the cost incurred by the portfolio in the buying and selling of underlying assets. This is expressed as a percentage of the daily NAV of the CIS and calculated over a period of 1 year. Obtain the costs of an investment prior to investing by using the EAC calculator provided at Advice fee | Any advice fee is negotiable between the client and their financial advisor. An annual advice fee negotiated is paid via a repurchase of units from the investor.

The portfolio manager may borrow up to 10% of the market value of the portfolio to bridge insufficient liquidity. This fund is also available via certain LISPS (Linked Investment Service Providers), which levy their own fees.

Total Expense Ratio (TER) | The Total Expense Ratio (TER) is the charges incurred by the portfolio, for the payment of services rendered in the administration of the CIS. The TER is expressed as a percentage of the daily NAV of the CIS and calculated over a period of 1 year. The TER is calculated from 01 July 2016 to 30 June 2017. A higher TER does not imply a poor return nor does a low TER imply a good return.

The Transaction Cost (TC) is the cost incurred by the portfolio in the buying and selling of underlying assets. This is expressed as a percentage of the daily NAV of the CIS and calculated over a period of 1 year. Obtain the costs of an investment prior to investing by using the EAC calculator provided at https://satrix.co.za/products.

When you invest online

Traditionally, investment advice come with a fee of up to 1%. But our smart online system is working to make investing cheaper and more profitable for you and hence no initial or annual advice fees will be charged. The management fee you do pay is based on the fund selected and calculated on your total contributions, and then applied to the overall value of your portfolio.

YOUR INVESTMENT WILL NOT CHARGE THE FOLLOWING FEES

  • No initial account set-up fees – usually charged at 2%.
  • No switching fees
  • No exit fees
  • No account changes fees
  • No rebalancing fees
  • No commissions
  • No debit order fees
  • No fund manager rebates

SO YOU’RE ONLY CHARGED THE RELEVANT FUND-MANAGEMENT FEE

Satrix is a South African ETF pioneer and caused a shake-up in the SA investment space when it introduced the country to ETFs in 2000 by launching the first ETF listed on the JSE. The Satrix TOP 40 ETF needs no introduction and serves as the go-to broad market exposure investment option for professional and amateur investors alike. So transformative have the Satrix product set and access options been to South Africans that people often (erroneously) refer to all index trackers as Satrix.

Since 2000 Satrix has listed 12 more ETFs. In fact, in 2017 alone it added a property ETF, an inflation-linked bond ETF, a Quality factor ETF and three offshore ETFs to its range. You can now build a completely diversified portfolio of local asset classes using only low-cost Satrix ETFs.

To make investing ever easier and cheaper (and online) we started working with the ground-breaking team at EasyEquities. The low-cost, no-minimum, online platform they had developed, which allowed fractional share trading, is perfect for our clients too. In no time at all we had our very own www.SatrixNOW.co.za platform up and running, which allows you to do everything online with no annual fees and extremely low trading costs. With SatrixNOW there really are no excuses as you can invest as little as R10.

Market review

Despite a positive start to the year, the SA Property Index (SAPY) delivered a modest total return of 2.2% in the first half of 2017, underperforming bonds, equities and cash. The Cabinet reshuffle and subsequent credit downgrades did little to derail bond yields, which benefited from capital flows into emerging market debt. Nonetheless, the sector derated owing in part to the flurry of negative news in the retail sector, which led to a deterioration in distribution growth prospects. The best-performing shares in the SAPY for the year so far included the likes of Fortress B, Octodec, Resilient and MAS PLC. By contrast, some of the worstperforming shares for the first half of 2017 included Accelerate Property Fund (- 20%) due to poor dividend growth outlook, and the large-cap heavyweights Growthpoint (-2%) and Redefine (-2%), which were hurt most likely from the country’s downgrade to junk status, given that they are most likely to be the largest and most liquid counters owned by foreign shareholders.

While local REITs have been affected by the lacklustre economic environment, companies have thus far been able to protect distribution growth. Some of the methods used to enhance the bottom line are non-recurring in nature, which is increasing forecast risk, artificially inflating the base period and reducing the quality of earnings across the sector. We see the potential for negative earnings surprises as the year unfolds, although most REIT managers generally provide conservative guidance. The market forecasts dividends per share growth of more than 7.5% over the next 12 months.

Interest rate-sensitive stocks may benefit from a rate cut later this year, but should not translate into upside for listed property, due largely to fixed-debt books and the lag between rate cuts and demand-side improvements. There may be some upside through debt restructuring and accretive local deals, but this will not be meaningful in our view.

Portfolio performance and changes

During the last three months corporate actions in the SAPY Index included shares in issue changes for Echo-Polska and MAS PLC. During the June quarterly rebalance, Greenbay Properties replaced Delta Properties in the index. Your fund performed in line with the index.

The year ahead

The yield spread between the SAPY and the long bond narrowed to -160 basis points (bps) in the first half of 2017. At these levels, the sector seems to be inexpensive compared to the historical average. This conclusion is not evident when comparing the sector to the long-term average spread as the increase in offshore exposure has made the South African 10-year bond as a benchmark rate less relevant. Nonetheless, slowing distribution growth should keep spreads at current levels, although further compression is unlikely due to REITs’ defensive characteristics.

The SAPY is currently on a 7.3% clean forward yield, with two-year expected growth in dividends of about 7% p.a., and in our view, longer-run growth in the CPI range of 5% p.a. This yield is now a 160 bps premium to (i.e. below) the long-bond yield. This 5% p.a. This yield is now a 160 bps premium to (i.e. below) the long-bond yield. This spread versus bonds has narrowed from as high as 260 bps in the first quarter of 2016, on account of local bonds outperforming the SAPY, with the SAPY derating over that 15-month period from 6.6%. The implied average yield of just SA-specific counters is higher, at 8.5%.

A total return of about 15% over the next 12 months seems reasonable, assuming a constant 10-year bond yield of 8.9% and the implied market risk premium of close to 4.9%.

Rand volatility could persist into year-end, as political turbulence gathers momentum in the lead-up to the ANC’s National Conference in December 2017.

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