How the Rag­ing Bull Awards are de­cided

Weekend Argus (Saturday Edition) - - GOODHANGOUTS -

The Rag­ing Bull Awards recog­nise the top per­form­ers in the col­lec­tive in­vest­ment, or unit trust, in­dus­try.

The top funds on out­right per­for­mance over three years in most do­mes­tic, rand-de­nom­i­nated for­eign and off­shore unit trust sub­cat­e­gories re­ceive a cer­tifi­cate.

A Rag­ing Bull Award is made to the top-per­form­ing do­mes­tic eq­uity fund over three years among all the funds in the three sub-cat­e­gories that in­vest across the JSE: gen­eral eq­uity, value and growth.

The top per­former over three years in the do­mes­tic fixed-in­ter­est bond and in­come fund sub­cat­e­gories also re­ceives an award.

Two awards are made for straight per­for­mance over three years to funds that in­vest in for­eign eq­uity mar­kets: one to the top­per­form­ing rand-de­nom­i­nated fund and one to the top-per­form­ing off­shore fund. An off­shore fund is not domi­ciled in South Africa but is reg­is­tered with the Fi­nan­cial Ser­vices Board (FSB) as a fund that can be mar­keted here.

Other cer­tifi­cates and Rag­ing Bull Awards – par­tic­u­larly for the as­set al­lo­ca­tion funds and the more pop­u­lar sub-cat­e­gories – are awarded on the ba­sis of riskad­justed re­turns over five years, as mea­sured by the PlexCrown rat­ings (see “What are Plexcrown rat­ings and how are they cal­cu­lated?”, This is be­cause risk man­age­ment is a ma­jor fac­tor in de­ter­min­ing a fund’s suc­cess.

To qual­ify for a Rag­ing Bull Award or a cer­tifi­cate, or for a man­age­ment com­pany to have the per­for­mance of a fund in­cluded in the cal­cu­la­tion of its av­er­age PlexCrown rat­ings, a fund must:

Be avail­able di­rectly to re­tail in­vestors.

In the case of an award made on the ba­sis of straight per­for­mance, be in a do­mes­tic unit trust sub-cat­e­gory (in­clud­ing South African-domi­ciled for­eign funds) that has at least five ac­tively man­aged funds with his­to­ries of three years or more.

In the case of an award made to a for­eign-domi­ciled (non-rand­de­nom­i­nated) fund on the ba­sis of straight per­for­mance, be in a sub­cat­e­gory that has at least nine ac­tively man­aged funds with his­to­ries of three years or more.

In the case of an award made on the ba­sis of risk-ad­justed re­turns, be in a ma­jor do­mes­tic or for­eign-domi­ciled as­set al­lo­ca­tion sub-cat­e­gory, or in one of the other larger do­mes­tic sub-cat­e­gories. Sub-cat­e­gories that have at least five ac­tively man­aged funds with his­to­ries of five years or more are in­cluded in the awards.

Not be a pas­sive, or an in­dex-tracker, fund. Th­ese funds are ex­cluded from the awards be­cause their per­for­mance re­flects mar­ket move­ments and not fund man­ager ex­per­tise.

Not be a money mar­ket fund. Th­ese funds are ex­cluded be­cause of the lim­i­ta­tions on them in terms of du­ra­tion and the types of in­stru­ments al­lowed.

Not be in a var­ied spe­cial­ist sub-cat­e­gory or in the do­mes­tic as­set al­lo­ca­tion tar­geted ab­so­lute and real re­turn sub-cat­e­gory. Funds in th­ese sub-cat­e­gories have dif­fer­ent in­vest­ment man­dates and ob­jec­tives, and rank­ing them would re­sult in false com­par­isons be­ing made.

Not have changed sub-cat­e­gories dur­ing the past year. Funds that have changed sub-cat­e­gories are not el­i­gi­ble for sub-cat­e­gory awards even if the As­so­ci­a­tion for Sav­ings & In­vest­ment South Africa has al­lowed such funds to re­tain their per­for­mance his­to­ries.

In the case of off­shore funds, they must have been reg­is­tered with the FSB for at least a year.

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