A relative newcomer to the market, Lodestone Investments, the multi-manager in the Standard Bank/Liberty Group stable, recently introduced new investment and retirement product, while Frater has come up with a unit trust in the domestic asset allocation flexible category.
Lodestone Investments
Name of product:
Standard Bank Multi-manager Endowment
What is it:
The new endowment is managed according to the multi-manager principle, which uses specialist managers to manage portions of the portfolio.
This provides for diversification across the asset classes, Gert van Rensburg, Lodestone's managing director, says.
Also, the company's approach to multi-management involves diversification across different investment styles and across a number of carefully selected specialist investment managers. This results in reduced volatility and enhanced returns for the investor. It is an investment philosophy that has been used by large pension funds with great success for some years, but was previously not accessible to the individual investor.
An endowment has been used because it has become an attractive investment medium since the introduction of Capital Gains Tax (CGT). CGT is deducted at the source within the investment portfolio at an effective rate of, at most, 7.5 percent, instead of the 10.5 percent that would be paid for other investments.
How it works:
Investors can select from three "building block" portfolios consisting of pure equity, pure cash or pure fixed-interest holdings, or create a combination of these to suit their personal preferences.
The Standard Bank multi-manager investment also offers five pre-structured, risk-profiled portfolios. These consist of different proportions of the three building block portfolios and, together with the building block portfolios, provide investment options across the entire risk and return spectrum.
Minimum investment:
The minimum investment is a R30 000 lump sum, or R500 a month.
Costs:
The maximum fees are an initial 3.5 percent with 1.85 percent a year in subsequent years on lump sum investments. Unlike many investments, these are true charges and are fully inclusive of all portfolio management and administration fees, Van Rensburg says.
Commissions:
The charges are inclusive of all commissions. Maximum commissions are at the regulated three percent of the lump sum. There are no trailer commissions.
Frater Asset Management
Name of product: Frater's
Flexible Fund
What is it:
This is a unit trust in the domestic asset allocation flexible category. With asset allocation funds, the fund managers decides for you what proportions to invest in the equity market, the bond market, property market or in cash.
The performance benchmark of this fund is made up of a 45 percent weighting in the JSE Security Exchange's All Share Index, a 25 percent weighting in the Financial and Industrial Index, five percent in the Property Unit Trust Index,
15 percent to the All Bond Index and 10 percent in cash.
Who should invest:
The investment is suitable for investors who have an average risk profile and who want to invest in South African equities, bonds, listed property and cash.
Minimum investment:
The minimum investment amount is R1 000 a month by debit order, or a lump sum of R10 000.
Costs:
There is no upfront charge, but an annual management fee of 1.5 percent and an exit fee, paid when you cash in your investment, of two percent. No commissions are paid.