Have balanced funds changed investor behaviour?

South African investors have had to deal with very muted returns for the better part of the last five years. Between July 1, 2013 and June 30 2018, the average return from unit trusts in the South Africa multi-asset high income category was just 8.2%.

This was a mere 2.8% ahead of inflation for this period. Given that these balanced funds would ordinarily be expected to produce returns of at least CPI + 5% over a five-year period, this is obviously disappointing.

What is notable, however, is that despite this situation investors have continued to favour these strategies. The latest statistics from the Association for Savings and Investment South Africa (Asisa) show that multi-asset high income funds continue to be the main savings vehicle for most people invested in local unit trusts.

At the end of June this year, the assets of funds in this category increased to above 25% of all assets in South African collective investment schemes for the first time. As the table below shows, it is the only major fund category to have shown consistent growth in both terms of assets and as a percentage of the total over the last five years.

 

Proceed to Source : MoneyWeb

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