Sanlam tracker fund takes off, albeit slow
Launched without much fan fare in the early part of 2014, the Sanlam Namibia Tracker Fund has managed to take off albeit at a slow pace while generating positive market sentiment, according to Wikus Fourie, Manager at Sanlam Unit Trusts.
Said Fourie “[the response was] initially positive but the general market has been slow in the take up of the new fund as the concept is still a new concept in Namibia.”
A tracker fund is made up of components of an index aiming to mimic the performance of an index by investing in the index as a whole. Index or tracker funds have set rules that dictate how much of each share or instrument in the index to buy and when these instruments or share may be sold.”
This begged the question whether the Sanlam Tracker Fund was similar to an Exchange Traded Fund. Said Fourie in response “It is similar to an ETF, it is just housed in a unit trust investment vehicle.”
Another issue of interest to the Economist was the progress of its All Namibia Fund, specifically, issues regarding liquidity, fund composition and whether the fund would be capped or not.
“The All Namibia Fund is a low equity balanced fund that invests in Namibian assets. It is an uncapped fund,” said Fourie.
With the word out that the Government Institutions Pension Fund was acquiring Namibian assets aggressively and the lack of activity on the Namibian Stock Exchange, the Economist asked Fourie about liquidity. He said, “Currently we are not constrained but this [liquidity] is a factor which we will have to manage and work with.”
He added “As this is the first of its kind the expected returns are difficult to gauge. But we can expect returns similar to other low equity funds less the exposure to offshore as the fund does not invest offshore.”