The fund achieved an 8.6% return over the past 12 months, and an annualised return of 11.8% over the period since its inception in mid-May 2013. This compares with the benchmark return of 8.3% and 9.1%, respectively. The fund’s performance over the past 12 months can also be compared against the S&P 500 Index, up 11.6% (in rand terms), and the FTSE All World Index, up 9.1% (also in rand terms).

During 3Q19, the large investment in GlaxoSmithKline was increased as we became more confident in the turnaround prospects for the business under CEO Emma Walmsley. The small investment in Swedish music-streaming business, Spotify, was increased slightly. No new investments were made. Sales of shares included a further reduction in the MasterCard investment and, for the first time since acquiring shares in August 2013, Unilever was reduced from 8.5% of the porfolio at 30 June 2019 to 6.6% at 30 September 2019. After strong share price performance in recent years, we believe Unilever is no longer as attractively priced by stock markets as before - justifying a reduction in this large holding.

The fund’s equity content ended the quarter at 93.3% - unchanged QoQ. Emerging market (EM) equity exposure decreased somewhat to 8.4% of the fund. Along with the investment in EM bonds and the rand/US dollar currency hedge, the direct EM exposure declined to 29.2% on 30 September 2019, from 32.0% of the fund at the end of 2Q19.