FINANCIALLY TALKING SEPTEMBER 2020 - Old Mutual Invest
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
FINANCIALLY TALKING SEPTEMBER 2020
2 FINANCIALLY TALKING
CONTENTS
COVID-19: LOOKING AHEAD 4
DIVERSIFICATION IS THE ONE TOOL INVESTORS CAN 6
COUNT ON
OLD MUTUAL LAUNCHES SOUTH AFRICA’S FIRST 8
ACTIVELY MANAGED ESG EQUITY UNIT TRUST
OUR RESPONSIBLE INVESTING SOLUTIONS 10
SAVINGS & INVESTMENT MONITOR: 11
COVID-19 SPECIAL REPORT
COVID-19 HIGHLIGHTS THE IMPORTANCE OF FINANCIAL 12
RESILIENCE, ESPECIALLY FOR SINGLE MOTHERS
STAYING CONNECTED IN A COVID-19 WORLD 14
STAY UPDATED 16
“Our human compassion binds us the one to the other – not in pity
or patronizingly, but as human beings who have learnt how to turn
our common suffering into hope for the future.”
– Nelson Mandela
ELIZE BOTHA | MANAGING DIRECTOR: OLD MUTUAL UNIT TRUSTS
Spring is here, and as the weather gets warmer and beautiful and behavioural shifts of working metropolitan South
flowers start to bloom, I am also inspired to think of what African households as a result of the Covid-19 pandemic. As
this season symbolises. Spring is a time of renewal and hope. we are a client-centric business, these findings enable us
Hope is a powerful thing. It inspires us to do the impossible
to understand, and find innovative ways to respond to, the
and helps us see the light during difficult times. This directly
changing financial needs of our customers to help them live
speaks to our mentality. Spring is a time for us to look to the
future with a fresh perspective. their dreams and prosper.
As our nation enters a new phase in our fight against According to OMSIM, 41% of women with children consider
Covid-19, I am encouraged to see hope for the future. There themselves single moms, and 60% of them receive no
have been signs of some recovery in the investment markets
financial contribution at all from the fathers of their children.
as economic activity resumes in most countries (including
This is up from 47% in 2019. In this edition, we look at the
South Africa), albeit unevenly across countries, regions and
sectors. In this edition Izak Odendaal helps us to look ahead importance of building financial resilience, especially for
as we continue to navigate the unpredictable effects of the single mothers, so that they can protect their families' future.
Covid-19 pandemic.
EMBRACING OUR COLLECTIVE
DESPITE LOWER H1 PROFITS FOR OML, SUPERPOWER
MOST GROUP SEGMENTS SHOW RESILIENT During August, we celebrated Women’s Month in South
PERFORMANCE
Africa. Despite the leadership shown during the 1956
On 1 September 2020, our holding company Old Mutual
Limited announced its interim results for the six months women’s march, 64 years later only 20.7% of women hold
ended 30 June 2020. directorships, 29.4% are in executive management, 11.8% are
in chairperson positions and 3.31% are CEOs of JSE-listed
Most of the Group segments showed resilient performance
despite the challenging operating conditions. Old Mutual companies, according to the Businesswomen's Association
Unit Trusts was no different, reporting strong net flows for the of South Africa.
six months to June 2020.
The key lesson we seem to be learning from Covid-19 isn’t
Covid-19 and the subsequent lockdown hit the economies the that of epidemiology, health, economics, environment, and
Group operates in quite hard. However, despite a reduction relationships. It is that of leadership and especially female
in sales and overall earnings, the long-term fundamentals
leadership. As early as April, the media distinguished how
for the Group remain robust. Our balance sheet and capital
countries led by women were seemingly managing the
position as well as our solvency ratio continue to be strong,
ensuring that the Group continues to meet its obligations to Covid-19 crisis better. This is quite interesting, considering
its clients. In addition, unit trust funds are protected, as they only 10% of countries are led by women. Since then, studies
are held by independent trustees. They offer added security, have been accumulating to support this initial view.
as unit trusts cannot be impacted by the liquidity of the
company or the asset manager. In a year in which the global community is grossly challenged
to deliver its best, it should be more obvious than ever before
Please remember to remain focused on your investment
that everyone, every voice is important – we all count. The
goals, stay invested if you can, and diversify your investments.
ways of old haven’t worked, and we need to chart a new path
Should you need to make decisions affecting your
investments, we encourage you to talk to your financial embracing the opportunity that the global crisis has given us.
adviser, who is equipped to answer any questions you This new path will require that bravery, new ideas, and varying
may have. If you’re a direct client, please contact our viewpoints be brought together in a melting pot of innovation
client care centre at 0860 234 234 or send an email to to deliver quality education, to grow our economies in an
unittrusts@oldmutual.com.
inclusive way, and to sustain our ailing planet.
2020 OLD MUTUAL SAVINGS AND There is great potential in tapping into the complete skills of
INVESTMENT MONITOR COVID-19 SPECIAL
REPORT the other 50% of the global population at more senior levels
This year, the 2020 Old Mutual Savings & Investment of business, government, and civil society. Doing this may
Monitor (OMSIM) has a particular focus on the attitudinal well be our collective superpower.
4 FINANCIALLY TALKING
COVID-19:
LOOKING AHEAD
IZAK ODENDAAL | INVESTMENT STRATEGIST, OLD MUTUAL WEALTH
The world is slowly emerging from the Covid-19 pandemic reflects the fact that investors don’t expect interest rates
that caused the most severe global economic shrinkage to rise anytime soon, even as they expect high inflation
since at least the 1930s. Over 75% of countries are now going forward. Historically, gold is seen as a safe haven, and
reopening at the same time as the pandemic is intensifying the fact that investors seek safety is telling. However, what
in many emerging market and developing economies. it reminds us of is how local asset classes are impacted
Several countries have started to recover and the outlook by global events. JSE-listed mining companies have seen
seems positive while the trend is definitely moving in the
their share prices double this year, completely unrelated
right direction.
to domestic developments. Unfortunately, South Africa is
ONE GOOD THING no longer the dominant gold producer, so we will benefit
The price of gold hit US$2 000 per ounce for the first time much less than a few decades ago. But we are still a big
recently. This is not good news in and of itself, because it producer of other commodities.
FINANCIALLY TALKING 5
The remarkable recovery of the JSE All Share Index from the interest payments. In fact, this year, 20 cents of every tax
33% crash in March is due entirely to global markets dragging rand will be paid to bondholders. It was as low as 10 cents
us along. This is good news: South African investments can a decade ago.
perform when global conditions are supportive, especially
since they are cheaper than their global counterparts. While LOOKING AHEAD
‘‘
many are ready to write off local investments completely At the end of July, global confirmed Covid-19 cases had
– understandably perhaps, following a long period of surpassed 18 million, with almost 700 000 deaths. The
underperformance – it would be a mistake. economic damage has also been severe, but the worst
is behind us. While the outbreak is by no means under
control, and there have been worrying flare-ups in many
parts of the world, a return to the hard lockdowns we saw
South Af rican investments can
in the second quarter is unlikely.
perform when global conditions
are supportive, especially since Economic activity is therefore recovering in most countries,
they are cheaper than their global including South Africa. However, it is a very uneven recovery
counterparts. across countries, regions and sectors. China, for instance,
has rebounded strongly, having been first in and first
out of lockdowns. This has supported commodity prices.
ONE BAD THING
Countries or regions that depend on international tourism,
The market remains extremely concerned over South
for instance, will take much longer to recover.
Africa’s government debt level. This is reflected in the high
yield on government bonds. While other countries have What also matters is sustained policy support. This is still
seen their long bond yields fall, ours are more or less at the case in most advanced countries, where interest rates
the same level as at the start of the year. In March, they are basically zero and governments can borrow essentially
spiked higher as foreign capital fled.
for free. Emerging markets like South Africa do not have
Ironically, the high bond yields reflect the market’s concern the same luxury. On the fiscal side, there is simply not
over debt sustainability, but also cause the debt to be money to be spent and Government faces very high
potentially unsustainable. Our overall debt levels are not market borrowing costs. On the monetary policy side, the
high by global standards, but high interest rates mean that SA Reserve Bank’s actions are constrained by its fear of
a substantial portion of tax revenue is spent on making losing control of the currency.
6 FINANCIALLY TALKING
DIVERSIFICATION IS THE
ONE TOOL INVESTORS
CAN COUNT ON
GONTSE TSATSI | HEAD OF RETAIL DISTRIBUTION AT
OLD MUTUAL INVESTMENT GROUP
While equities continue to be the best performing asset The key is not to place all your eggs in one basket. Rather,
class over the long term, a multi-asset class solution remains investors should focus on a multi-asset class solution that
a sound investment strategy to mitigate risk. comprises shares, property, bonds and cash. In this way,
diversification is the one tool that you can count on.
Investors have learnt some important investment lessons
this year due to the market turmoil caused by the Covid-19 After the idea of "time in the market" and extending one’s
pandemic. Economic developments in the last few months holding period for more than five years in order to reduce
reinforce the importance of diversification and the need to risks, diversification is the second most valuable tool to
balance the risks of market volatility. In this way, investors help you manage risk. This is because a diversified portfolio
stand a better chance of meeting both their short- and reduces the impact that a single, poorly performing asset
long-term financial goals. has on your overall portfolio.
FINANCIALLY TALKING 7
Analysis by Old Mutual Investment Group on the performance illustrated again with the Covid-19 market sell-off when
of different asset classes over the past 90 years reveals some equity markets fell by 28% between 5 March and 19 March.
impressive results. The most significant is that although Balanced funds also fell between 8% and 23% depending on
equities may have been the best performing asset class the exposure to equities (between 5 March and 24 March).
‘‘
since 1930, cash was the best performer for 11 of those
This is the reason for the government regulations that a
years and listed property for nine years. This is detailed in
standard pension fund allocation is 75% in equities (whether
Old Mutual Investment Group’s Long-Term Perspectives 2020.
in South Africa or abroad) and 25% in either property (local
or international) or foreign investments (excluding Africa).
A maximum of 5% of the total capital invested can be in
Investors have learnt some
Africa (referring to outside South Africa).
important investment lessons this
year due to the market turmoil It may not be the best time for many investors to adjust their
caused by the Covid-19 pandemic. portfolios, as some would be locking in losses caused by
the Covid-19 pandemic. Going forward, however, this event
should prompt investors to include greater diversification
However, local equities topped the performance charts only in their portfolios.
47% of the time over this period, followed by gold (18%),
Now remains as good a time as any to reassess one’s
bonds (13%), cash (12%) and property (10%) – highlighting
portfolio to reduce over-exposure to high-growth, or low-
the importance of spreading one’s risk.
risk, assets. A diversified portfolio needs to balance out
By having a diversified portfolio, you don’t remove the various factors so that you meet your long-term goals
volatility, but you can drastically reduce it. This was without taking on undue risk.
8 FINANCIALLY TALKING
OLD MUTUAL LAUNCHES
SOUTH AFRICA’S FIRST
ACTIVELY MANAGED ESG
EQUITY UNIT TRUST
“ESG funds are increasingly shown to deliver sustainable
Old Mutual has launched the first local actively
adjusted long-term returns for clients. Businesses that
managed environmental, social and governance
prioritise ESG matters are better equipped to thrive in
(ESG) equity fund in South Africa. This follows
the long run.”
efforts to expand its existing suite of responsible
investments, which comprises the Old Mutual MSCI Morningstar data shows that amid the pandemic, 24
World ESG Index Feeder Fund and Old Mutual MSCI out of 26 index funds that focus on companies with
Emerging Markets ESG Index Feeder Fund, both of the highest ESG scores outperformed their closest
which were launched in 2018. conventional counterparts.
Fawaz Fakier, Fund Manager of the ESG Equity Fund,
According to Elize Botha, Managing Director of says that as a responsible asset manager Old Mutual
Old Mutual Unit Trusts, the decision to launch the new identified a gap in the market. “Sustainable investing
fund was in response to changing investor needs and has really taken off in the past five years. We saw this
evidence of superior returns. trend abroad and locally with the uptake of our own
FINANCIALLY TALKING 9
ESG passive funds launched two years ago. It was this actively managed equity fund. The fund is available in
and market intel that confirmed that there was an Old Mutual’s suite of tax-free solutions.
opportunity for a local, actively managed ESG unit trust,”
According to Botha, ESG investing has grown in
says Fakier.
popularity and credibility over the past few years, with
The hallmarks of the fund include the portfolio’s investors profiting from rewarding companies that
‘‘
significantly lower carbon footprint and higher ESG look beyond just the bottom line. “This has been most
profile relative to the benchmark (the FTSE/JSE Capped pronounced in the choices of Generation Z and their
Shareholder Weighted All Share Index). millennial parents, who think differently about how they
spend, save and invest their money,” says Botha.
This is supported by a Morningstar report in March 2020,
ESG funds are increasingly shown which revealed that 95% of millennials are interested
to deliver sustainable adjusted in sustainable investment. In addition, 90% want their
long-term returns for clients. investments tailored to match their values.
Businesses that prioritise ESG
This demographic shift is expected to have a considerable
matters are better equipped to
influence in the near future, with a Morgan Stanley study
thrive in the long run. revealing that US$30 trillion in wealth will transfer from
baby boomers to millennials over the next few decades.
Launched on 31 May, the fund invests in companies that According to Botha, “Many companies are adapting
have strong balance sheets, sustainable cash flows, are to the scrutiny that their business practices, and not
well priced and score highly on proprietary researched only their bottom line, are under. Business leaders are
ESG criteria. “The fund is aimed at investors with a longer- increasingly committing to building their sustainability
term horizon and who are primarily seeking exposure to credentials, but they need to step up their efforts to
a domestic general equity fund with a high ESG focus,” achieve carbon neutrality in order to remain relevant.”
says Fakier.
Botha says this is precisely what investors with a longer-
He says that the fund’s annual investment charge of term horizon can expect from the Old Mutual ESG Equity
1.18% for retail investors is comparatively low for an Fund.
10 FINANCIALLY TALKING
OUR RESPONSIBLE
INVESTING SOLUTIONS
Let your investments reflect your values, while giving you
competitive returns with our Responsible Investment
OLD MUTUAL ESG UNIT TRUSTS
Unit Trusts.
Our ESG funds help you to invest in companies with
better ESG scores – sustaining the environment,
WHAT IS RESPONSIBLE INVESTING?
improving social conditions and promoting good
To us, responsible investing means considering
environmental, social and governance (ESG) issues when governance, without sacrificing returns.
making investment decisions. It also entails being responsible
We have the following funds available to investors:
stewards of our clients’ money, which entails actively
engaging with companies around ESG issues, and voting Old Mutual MSCI Emerging Markets ESG Index
on company resolutions (proxy voting). This helps to ensure Feeder Fund: a low-cost index fund that aims to
that companies have sound governance practices and achieve long-term capital growth by owning a
good labour practices, and manage their impact on the basket of shares with high relative ESG ratings
environment and local communities.
across emerging markets.
WHAT IS ESG? Old Mutual MSCI World ESG Index Feeder Fund: a
Environmental – looks at the effects of issues such as low-cost index fund that aims to achieve long-term
climate change, pollution, food security and water scarcity. capital growth by owning a basket of shares with
high relative ESG scores across developed markets.
Social – considers socio-economic issues such as impacts
on the community, inequality as well as health and safety. Old Mutual ESG Equity Fund: a South African
equity fund that aims to achieve long-term capital
Governance – focuses on how companies are constituted,
growth by gaining exposure to companies with a
the depth of experience on the board, levels of diversity
superior ESG score relative to their peers. The fund
and independence.
will target a lower carbon footprint and a higher
To analyse the future returns of a company we need to ESG profile relative to its benchmark.
understand how much exposure it has to these three
factors and, additionally, how well it is placed to generate
income from providing solutions to these problems. For more information, visit www.oldmutualinvest.comFINANCIALLY TALKING 11
SAVINGS & INVESTMENT MONITOR:
COVID-19 SPECIAL REPORT
Every year during Savings Month, Old Mutual launches its updated Old Mutual Savings & Investment Monitor (OMSIM).
This year the primary focus was on the impact of Covid-19.
Based on feedback from 1 500 working metropolitan adults in South Africa, these are the top 10 key findings:
THE OLD
INCIDENCE OF HAVING
MUTUAL
57% “OTHER” SANDWICH
GENERATION
ADULT DEPENDANTS HAS INCREASED INDICATOR
43 52
ARE EARNING LESS
% %
SINCE THE START
OF LOCKDOWN HAS INCREASED FROM 34%
IN 2019 TO 42% IN 2020
IN 2019 IN 2020
(THIS IS UP BY 15% SINCE 2015)
SATISFACTION WITH CREDIT CARD FEEL HIGHLY
FINANCIAL SITUATION STRESSED
HOLDERS ARE ABLE TO
58%
5.3 6.3
ABOUT THEIR
COMFORTABLY MAKE FINANCIAL
DOWN
FROM THEIR REPAYMENTS SITUATION
(OUT OF 10) IN 2019 1 IN 2 EVERY MONTH (THIS IS UP BY 20% SINCE 2019)
HAVE
PERSONAL 23 % MEMBERSHIP
OF STOKVELS
HAS DECLINED,
43%
LOANS FROM HAVE CASHED BUT MORE ARE
A FINANCIAL IN SAVINGS OR CONTRIBUTING
INSTITUTION INVESTMENT POLICIES TO GROCERY
(UP FROM OVER THE PAST SCHEMES AND
21% IN 2019) FOUR MONTHS BURIAL SOCIETIES
40 % HAVE ENOUGH MONEY TO ONLY LAST 1
MONTH OR LESS IF THEY LOST THEIR JOBS
RECESSION PROOF YOUR FINANCIAL GOALS
1. Pay off your debt ASAP – Stay committed to paying off high-interest debt, such as your credit and store cards, as
soon as possible.
2. Trim your expenses, lockdown style – Take a cold, hard look at your lifestyle and find inventive ways to trim expenses.
3. Stay invested – Avoid withdrawing your investments from the market out of fear of losing money, as doing this could
mean you miss out on great investment returns and lock in losses.
4. Start your emergency fund now – Use any savings you can to kick-start a nest egg earmarked for unexpected
expenses, such as medical costs or unforeseen expenses, or loss of income.12 FINANCIALLY TALKING
BUILDING FINANCIAL
RESILIENCE AS A
SINGLE MOTHER
PAT MAGADLA | SENIOR BUSINESS DEVELOPMENT MANAGER AT
OLD MUTUAL INVESTMENT GROUP
The latest National Income Dynamics Study (NIDS) Reports from the UK and the US suggest that the
Coronavirus Rapid Mobile Survey reveals that of the Covid-19 pandemic has impacted low income, black,
three million South Africans who lost their jobs between Asian and minority ethnic women most significantly.
The impact of Covid-19 globally is reported to be more
February and April 2020, two million were women.
severe on black women, who face greater exposure to
This is particularly a risk for single-income families in financial vulnerability, compounded by the weight and
South Africa, who are most likely headed by a single responsibility of caregiving, often for their extended
family too.
mom. It's clear that not only are women at a serious
economic disadvantage to start with, but single mothers Single mothers already show remarkable resilience in
in particular also shoulder enormous responsibility for so many aspects of their lives. They juggle parenting
the wellbeing and financial security of their families – with a career or business and running their household.
with little or no help. With the uncertainty of the 2020 school year, many
have had to take on the role of home schooling too.
According to the 2020 Old Mutual Savings and
Given all this, it's understandable that some areas face
Investment Monitor Covid-19 Special Report, 41% of
neglect and it's often financial planning that suffers
women with children consider themselves single moms,
most. A key way that mothers can protect their families'
and 60% of them receive no financial contribution at all future is to start an emergency fund that will see
from the fathers of their children. This is up from 47% them through an unforeseen crisis or being let down
in 2019. financially by their co-parent.FINANCIALLY TALKING 13 Here are a few practical steps to help single mothers improve their financial resilience. BE PREPARED: INCREASE YOUR SAVINGS Part of building your resilience is being prepared for any eventuality. Increasing your savings as much as you possibly can, is the first place to start. Ahead of the tax season, use any financial windfall you get, such as a tax refund, to seed your savings. Lockdown has also shown that we can live without certain luxuries. Now more than ever, it is important to cut expenses where you can. For instance, do you need that DStv subscription? Or how about making homemade pizza, doing your own hair at home, and creating your own birthday cards to gift loved ones? BE SMART: REDUCE YOUR DEBT The less of your income goes to servicing debt, the more financially resilient you'll be. We should all try to live within our means and avoid bad debt. Bad debt is usually high-interest bearing, such as credit and store cards. BE PROACTIVE: ENSURE YOUR FINANCIAL WELLNESS A smart move is to diversify your income by having more than one way to earn money. That side hustle you've been talking about for years? Start it now. By being less reliant on a single source of income, you can create a valuable buffer. By securing their financial independence, single mothers can mitigate income gaps and ensure that, regardless of economic scenarios, their children's future is still secured. For those moms who are already in an awkward position financially, acknowledge your situation but understand that it can be turned around. Draft yourself a plan, take action and stay the course. If Covid-19 has shown us anything, it's that the world can change overnight. Things that we took for granted – such as hugging a loved one or shaking a stranger's hand – are no longer an option. We need to be able to thrive both personally and financially, whatever the world throws at us. This kind of resilience can only be achieved through proper planning, and it's never too late to start.
14 FINANCIALLY TALKING
STAYING CONNECTED IN A
COVID-19 WORLD
The Covid-19 pandemic and subsequent lockdowns have dramatically changed the everyday behaviour of billions of
people. The increasing use of technology to work, play, and stay connected has shaped new digital habits. There has
been an almost immediate shift from traditional methods of business, retail and social interaction to a world that's
completely online, and the use of technology is no longer a choice, but a necessity.
At Old Mutual Unit Trusts, we have always been driven to embrace technology to enable us to be future fit. Covid-19
has provided a unique opportunity for us to meet and engage with our clients and advisers virtually through the use of
various digital platforms.
Take a look at how we’ve accelerated our digital adoption over the past few months.
OLD MUTUAL INVESTMENT INSIGHTS DIGITAL CONFERENCE
Investment Insights, Old Mutual Investment Group’s flagship event aimed at advisers,
took place online on 23 July 2020. Themed "Dark clouds and silver linings"', the discussions
centred on rising above the noise and shifting perspective to focus on the good.
RESPONSIBLE INVESTING
CAMPAIGN
At the end of May, we launched the
Old Mutual ESG Equity Fund and
ran a social media campaign to
educate both clients and advisers
on responsible investing and ESG.FINANCIALLY TALKING 15
INVESTMENT SERIES – THE LOCKDOWN
CAMPAIGN
Much has been said about the economic impacts
of Covid-19. However, if you are lucky enough to
have a job, you are probably experiencing some
unexpected savings… using less petrol, no "going
out" expenses and no daily take-away coffee.
At the beginning of July, we embarked on a
campaign to target individuals that were able
to achieve some form of saving during the
lockdown. It played on the various unexpected
savings through ads on social media.
SHARI’AH – INVEST WITH FAITH
To align with the launch of the Old
Mutual Albaraka Income Fund we
rolled out the second phase of our
Invest with Faith Shari’ah campaign.
The Invest with Faith campaign was
initially launched in 2019 and is aimed
at advisers and clients, both Muslim
and those dedicated to responsible
sustainable investing. It is premised
on the fact that faith is universal and
has its own meaning for everyone.
Through our proud partnership with
Al Baraka Bank, the aim is to give
investors the opportunity to put
their money into something that
supports their beliefs and values.
WITH JON DUNCAN
AND FAWAZ FAKIER
WEBINARS
As face-to-face engagements are not permitted at the moment, we have repackaged our events for the foreseeable
future as virtual conferences. These take the format of weekly webinars, which are informative presentations by
our investment professionals and business leaders to keep our adviser community up to date on a wide range of
financial and investment topics.16 FINANCIALLY TALKING
STAY UPDATED
CHANGES TO YOUR OLD MUTUAL
UNIT TRUSTS INVESTMENT
In the first quarter of 2021, we will be moving our client administration to a new platform.
In our last quarterly communication we provided an opportunity for clients who had specific features in their
portfolios to respond by 31 July before we apply the default option. Below is the list of defaults we will be applying to
any of the scenarios that may still exist in your portfolio.
If you would like to query any of these changes please call our service centre at 0860 234 234, visit
https://www.oldmutualinvest.com/home, email us at unittrusts@oldmutual.com or inform your financial planner.
1 2 3 4
DEBIT FUNDS REGULAR TAX-FREE
ORDERS TRANSACTIONS INVESTMENTS
IF CLIENTS HAVE: AFTER THE TRANSFER: DEFAULT OPTION APPLIED:
DEBIT ORDERS More than one debit order Only one debit order per investment If multiple debit orders have the same frequency (e.g.
per unit trust fund within contract will be possible and you will not monthly) these debit order amounts will be combined
1 one investment contract. be able to have multiple debit orders within to create one debit order amount.
the same contract or unit trust fund/s.
If the debit orders have multiple dates then the date of
the debit order with the highest value will be chosen.
A rand-based escalation Only percentage-based escalations can be A percentage-based escalation amount will be
1 amount on their administered. calculated based on the rand amount of the escalation
investment contract. and will be applied to your contract. It should be
between 1% and 20%.
FUNDS More than one instance of On transfer to the new administration platform, Multiple fund instances will be merged into one
the same unit trust fund multiple instances of the same unit trust single unit trust fund within the contract and any
2 in an investment contract. fund will not be possible within a single existing debit orders across the multiple funds will
investment contract. be consolidated into one debit order instruction.
Multiple methods of Only one distribution method is allowed for Separate contracts will be created to support the
distribution from unit all unit trust funds per investment contract. different distributions.
2 trust funds within the You can choose one of the following options
same contract. at a contract level:
• Reinvesting into the same unit trust fund
• Distributions can be invested into any fund
of your choice OR
• Paid out into a bank accountFINANCIALLY TALKING 17
IF CLIENTS HAVE: AFTER THE TRANSFER: DEFAULT OPTION:
REGULAR
TRANSACTIONS More than one regular monthly, Only one regular disinvestment is allowed Consolidate all into one disinvestment
quarterly or annual disinvestment per investment contract. instruction using the date of the
3 from the same unit trust fund. However, the value of the disinvestment disinvestment with the largest value.
can be allocated across different unit trust
funds within the same investment contract.
TAX-FREE
INVESTMENTS
Contributed more than the maximum Contributions will be limited to R36 000 per Existing debit order amounts higher than
limit of R36 000 per year for Tax-Free tax year with a current life-time contribution R3 000 will be set to R3 000 per month.
4 Investments. of up to R500 000.
Multiple Tax-Free Investments across Only one Tax-Free Investment across Not applicable.
4 22seven and Old Mutual Unit Trusts. 22seven and Old Mutual Unit Trusts will
be allowed.
ENSURE THAT YOUR PERSONAL INFORMATION CHANGE TO ELECTRONIC COMMUNICATION
IS UP TO DATE With email correspondence, you:
As legislation requires, you need to ensure that • May opt to receive additional correspondence
the following information is always updated (such as transaction notifications), which is not
and communicated to the Service Centre: available for post correspondence
• Title • Benefit from efficient delivery of correspondence,
• Gender with a lower carbon footprint when compared
• Country of residence for tax purposes to post correspondence
• ID or passport number • Ensure that your correspondence is password-
• Physical address details protected so that your personal information is
• Email address more secure
Old Mutual believes in the benefits of sending correspondence via email as opposed to post. Contact the
Old Mutual Unit Trusts Service Centre on 0860 234 234 to change your correspondence preference to email.About Old Mutual Unit Trusts
Old Mutual Unit Trust Managers (RF) (Pty) Ltd is a registered manager in terms of the Collective Investment Schemes Control Act 45
of 2002. The fund fees and costs that we charge for managing your investment are set out in the relevant fund's Minimum Disclosure
Document (MDD) or table of fees and charges, both available on our public website, or from our contact centre. Collective Investment
Schemes are generally medium- to long-term investments; the value of participatory interests or the investment may go down as well as
up; past performance is not necessarily a guide to future performance. Old Mutual is a member of the Association for Savings & Investment
South Africa (ASISA).
Important Information
Old Mutual Unit Trust Managers (RF) (Pty) Ltd is part of Old Mutual Wealth (OMW), which is an elite service offering brought
to you by several licensed Financial Services Providers in the Old Mutual Group ("the Old Mutual Group"). This newsletter is for
information purposes only and does not constitute financial advice in any way or form. It is important to consult a financial
planner to receive financial advice before acting on any information contained herein. OMW, the Old Mutual Group and its
directors, officers and employees shall not be responsible and disclaim all liability for any loss, damage (whether direct, indirect,
special or consequential) and/or expense of any nature whatsoever, which may be suffered as a result of, or which may be
attributable, directly or indirectly, to the use of, or reliance upon any information contained in this newsletter.You can also read
