The Investec Managed Fund Namibia follows the Investec house-view asset allocation, within the constraints of pension fund prudential requirements, and maintains a minimum investment of 35% in Namibian assets in compliance with Regulation 28 of the Namibian Pension Funds Act.

The asset allocation at the end of June was as follows: 59% equities, 17% bonds, 10% cash and 14% offshore. The fund's international exposure is housed in the Investec Global Managed Fund, of which has a 74% is invested in equities. Therefore, the overall equity exposure, domestic and foreign, amounts to 70% of the total fund.

The fund posted a return of 2.2% in June, bringing the total return for the last twelve months to 31.5%. The good return over 12 months was due to strong market performance and good stock-picking.

Most global equity markets posted positive returns during June, resulting in a positive quarter. Emerging equity markets outperformed the developed markets quite substantially - the MSCI Emerging Market Free Index achieved a total return of 3.5%, while the MSCI Developed Index delivered only 0.9%, both in US$-terms.

The rand appreciated marginally against the USD by 0.7% during the month, following its sharp fall in May. Therefore the international component of the fund, having returned 0.8% in USD, contributed to overall performance with a return of 0.1% in N$ terms. However, over the past six months the return amounted to 19.1% on this portion of the fund.

The South African equity market returned 3% during June, with all the economic groups gaining ground. The total return of the All Share index amounts to 13.6% over 6 months and 44.3% over 12 months. Within equities, the fund remains overweight the industrial and financial sectors, which outperformed resources over the past twelve months.

The bond market returned 2.7% over the month and the fund's SA bond investments performed in line with the market.

In Namibia the NSX Overall Index returned 0.9%, while the NSX Local Index was up by 6.6%. In the Namibian equity context the fund is also overweight financial and industrial counters.

Against the current macroeconomic backdrop of low interest rates, low inflation and robust consumption spending, we maintain a stance of being overweight industrials and financials.