Benchmark changes

Old Mutual Unit Trusts will implement benchmark changes to the following funds with effect from 1 July 2017:

  • Old Mutual Investors’ Fund
  • Old Mutual Growth Fund
  • Old Mutual Top Companies Fund
  • Old Mutual Managed Alpha Equity Fund
  • Old Mutual Maximum Return Fund of Funds

Please note that these benchmark changes will have no impact on your service fees as the funds don’t charge performance fees.

Old Mutual Investors’ Fund

This SA-only fund invests across all sectors, focusing predominantly on the Top 100 blue-chip shares. The challenge with the fund’s current FTSE/JSE Shareholder Weighted All Share Index (“SWIX”) benchmark is that it is to a large extent driven by the performance of a single stock (Naspers). By replacing the SWIX benchmark with the Category Average ASISA SA-Equity-General benchmark we will reduce the level of concentration risk without restricting the portfolio managers’ investment view.

Old Mutual Growth Fund

This fund typically has exposure to SA and global equities. The fund’s SWIX benchmark will be replaced by a composite benchmark that better reflects its investible universe. The fund’s new composite benchmark will be 87.5% Category Average of the ASISA SA-Equity-General category and 12.5% MSCI World Index. The inclusion of the Category Average of the ASISA SA-Equity-General category in the composite benchmark will reduce the level of concentration risk attached to the use of the current SWIX benchmark.

Old Mutual Top Companies Fund

This South African-only fund invests in a concentrated portfolio of high-conviction shares across all sectors of the JSE. The fund’s SWIX benchmark will be replaced with the Category Average of the ASISA SA-Equity-General category. The benchmark change will reduce the concentration risk attached to the use of the current SWIX benchmark, without restricting the portfolio managers’ investment view.

Old Mutual Managed Alpha Equity Fund

This fund uses a proprietary quantitative investment process requiring a readily available, investible and diversified benchmark. The challenge with the fund’s current FTSE/JSE Shareholder Weighted All Share Index (“SWIX”) benchmark is the concentration risk attached to it as a result of the SWIX benchmark. We therefore decided to replace the SWIX benchmark with the relatively new FTSE/JSE Capped Shareholder Weighted All Share Index (“Capped SWIX”) benchmark. The Capped SWIX follows the same methodology as the SWIX, but restricts exposure to any single constituent to 10%. The benefit of the Capped SWIX benchmark is that it significantly reduces the level of concentration risk to which the fund is exposed, resulting in improved stock diversification and better risk-adjusted returns.

Old Mutual Maximum Return Fund of Funds

This worldwide multi-asset flexible fund has a composite benchmark as each asset class is managed to a specialist asset class benchmark. The equity component’s current SWIX benchmark will be replaced with the Capped SWIX benchmark, which restricts exposure to any single constituent to 10%. This will reduce the level of concentration risk to which the fund is exposed, resulting in improved stock diversification and better risk-adjusted returns.