Re­tail clients can track the stock mar­ket per­for­mance at a rel­a­tively low cost, writes Maya Fisher-French

CityPress - - Business -

Since San­lam bought out Sa­trix two years ago, it has been im­ple­ment­ing some in­ter­est­ing changes that have im­proved the of­fer­ing to in­vestors who want to ac­cess low-cost pas­sive in­dex funds. Sa­trix built its brand by of­fer­ing ex­change-traded funds (ETFs), which al­low re­tail clients to track the stock mar­ket per­for­mance at a rel­a­tively low cost.

In­vestors pur­chase the ETFs through a stock­bro­ker, or they could in­vest via the Sa­trix In­vest­ment Plan for monthly in­vest­ments or a min­i­mum lump sum of R1 000.

The un­der­ly­ing fund man­age­ment costs are rel­a­tively low (about 0.5%, de­pend­ing on the fund), but there is an ad­di­tional 0.7% ad­min­is­tra­tion fee for us­ing the In­vest­ment Plan, which brings the to­tal cost of in­vest­ing to more than 1% a year.

By us­ing the ex­ist­ing San­lam unit trust plat­form, Sa­trix now of­fers in­dex-track­ing unit trusts. This has re­duced the ad­min­is­tra­tion costs of in­vest­ing on a monthly ba­sis.

In­vestors can ac­cess many of the in­dices of­fered by Sa­trix ETFs through the unit trust plat­form – for ex­am­ple, the Sa­trix Top 40 In­dex Fund, the Sa­trix Div­i­dend Plus In­dex Fund, the Sa­trix RAFI 40 In­dex Fund and the MSCI World Eq­uity Feeder In­dex Fund.

The to­tal cost for both the un­der­ly­ing fund fee and ad­min­is­tra­tion is 0.6% a year, mak­ing it one of the most cost-effective in­vest­ment op­tions for some­one want­ing to in­vest R500 a month or a lump sum of R10 000.

In ad­di­tion to the sim­ple in­dex-track­ing funds, Sa­trix has cre­ated blended-in­dex port­fo­lios on its unit trust plat­form. The Sa­trix Bal­anced In­dex Fund pro­vides in­vestors with di­ver­si­fied ex­po­sure to all ma­jor as­set classes, in­clud­ing off­shore ex­po­sure. Last week, Sa­trix launched the low-eq­uity bal­anced-in­dex fund for more con­ser­va­tive in­vestors.

Both of th­ese funds meet the pen­sion fund reg­u­la­tions and can be used in re­tire­ment funds. Sa­trix aims to launch a low-cost re­tire­ment an­nu­ity later this year and there are also plans to launch new in­ter­na­tional feeder funds.

Sa­trix ETFs re­main a good op­tion for in­vestors who wish to in­vest in a di­ver­si­fied port­fo­lio through their stock­bro­ker, as well as for in­vestors who wish to in­vest lower amounts – the min­i­mum monthly in­vest­ment for a Sa­trix ETF is R300 a month, with a min­i­mum lump sum of R1 000.

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