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Precious Metals Securities Fund Report - April 2018

IM Insights
By IM Insights
4 years ago
Precious Metals Securities Fund Report - April 2018

Shariah


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  1. Precious Metals Securities 3-year Fund Volatility 32 .8 Very High April 2018 Lipper Analytics 28 Feb 2018 Precious Metals Securities (the "Fund") aims to achieve capital appreciation by investing in a portfolio of global Shariah observant equity and equity-related securities (including, without limitation, depository receipts and convertible securities, but excluding preferred shares, bonds, convertible bonds and warrants) of companies engaged in activities related to gold, silver, platinum or other precious metals. The Fund is suitable for investors seeking: • a global investment strategy that conforms to Shariah principles. • potential medium to long-term* capital appreciation. • to invest in gold, silver, platinum and other precious metals equities, and their related equities. Note: *Medium to long-term refers to a period of at least three (3) years. Target Fund's Top 5 Holdings* (as at 31 March 2018) Newmont Mining Corp Randgold Resources Ltd Agnico Eagle Mines Ltd Franco-Nevada Corp Centamin PLC 10.48% 6.47% 5.84% 5.36% 4.99% Investment Strategy • A minimum of 95% of the Fund’s NAV will be invested in the share class denominated in USD of the Deutsche Noor Precious Metals Securities Fund (Target Fund). * As percentage of NAV. Please note that asset exposure for the Fund is subject to frequent change on a daily basis. Source: Deutsche Investment Management America Inc (Target Fund’s Investment Manager) Asset Allocation • DWS Noor Precious Metals Securities Fund • Cash and others Gold Silver Precious Metals & Minerals Cash & Other Assets 96.68% 3.32% Source: AmFunds Management Berhad Fund Details Fund Category / Type Fund Launch Date Offer Price at Launch NAV Per Unit (31 Mar 2018) 1-year NAV High (31 Mar 2018) 1-year NAV Low (31 Mar 2018) Total Units (31 Mar 2018) Fund Size (31 Mar 2018) Annual Management Fee Annual Trustee Fee Entry Charge Exit Fee Redemption Payment Period Investment Manager Income Distribution Feeder (Global Islamic equity) 15 November 2007 MYR 1.0000 MYR 0.3573 MYR 0.4613 (13 Apr 2017) MYR 0.3573 (30 Mar 2018) 1,003.12 million MYR 358.44 million Up to 1.80% p.a. of the NAV of the Fund Up to 0.08% p.a. of the NAV of the Fund Up to 5.00% of the NAV per unit for cash sales Nil By the 10th day of receipt of a repurchase notice AmIslamic Funds Management Sdn Bhd Income distribution (if any) will be reinvested. Target Fund's Sector Allocation* (as at 31 March 2018) 83.75% 7.25% 6.66% 2.30% * As percentage of NAV. Please note that asset exposure for the Fund is subject to frequent change on a daily basis. Source: Deutsche Investment Management America Inc (Target Fund’s Investment Manager) Target Fund's Country Allocation* (as at 31 March 2018) Canada Others Australia United States Mali Jersey Cash and other assets 35.66% 17.72% 17.50% 15.33% 6.47% 4.99% 2.30% * As percentage of NAV. Please note that asset exposure for the Fund is subject to frequent change on a daily basis. Source: Deutsche Investment Management America Inc (Target Fund’s Investment Manager) Fund Performance (as at 31 March 2018) Cumulative performance over the period (%) 40.00 Source: AmFunds Management Berhad 20.00 Target Fund Manager's Commentary 0.00 During the month of March, Gold was the only precious metal that had a positive return of 0.50%. Palladium, Platinum, and Silver each had negative returns of -8.69%, -5.27%, and -0.29%, respectively. -20.00 Gold and precious metals equities, as measured by the S&P BMI Gold and Precious Metals Index (non-Sharia compliant), gained 2.26% during the period. -40.00 Gold ETFs flows were relatively flat during the month. Despite much noise during the month of March, the Gold price ended the month relatively flat, starting the month at USD 1,318/oz and ending at USD 1,325/oz. Throughout the month, we saw the price trade in a broad range, however, as an increase in the Fed target rate and tariffs whipsawed the Gold price in a USD 40/oz range. We continue to have muted expectations for the Gold price going forward barring any material increases in risk. -60.00 -80.00 Precious Metals Securities Nov-07 The traditional waypoints for the forward path of the Gold price were mixed in March as well, with the USD flat, yields down, inflation breakeven falling and financial conditions tightening. Fund (%) However, recently the market has seen a shift in inflation expectations that could keep real rates depressed despite nominal increases in yields as global central bankers normalize policy. It is of the utmost importance for Gold investors to monitor the relationship between nominal yields (e.g. Treasuries), inflation expectations (e.g. forward TIPS breakeven), the USD and realized inflation. *Benchmark (%) We believe our approach will more than make up for the lack of gearing to the Gold price in environments with elevated volatility through company specific re-ratings. As portfolio firms demonstrate the increase in overall production level and financial flexibility that accompany exiting the heavy spending portion of the capex cycle, we believe investors will respond by increasing valuations relative to peers, driving alpha 1m 6m 1 yr 3 yrs 5 yrs -1.62 -11.36 1.00 -13.37 -15.85 4.08 -37.98 -17.98 32.53 -23.68 *FTSE Gold Mines Index Source Benchmark: *AmFunds Management Berhad Source Fund Return : Novagni The Fund Performance is calculated based on NAV-to-NAV using Time Weighted Rate of Return (''TWRR'') method Calendar Year Return We see the risks to real rates as roughly balanced at this point, informing our somewhat muted views on the Gold price this year. We continue to keep the fund invested in companies with strong management teams that have shown the ability to execute with operational stability and have a lower than average financial and operational risk profile. We believe this approach will generate alpha through the entire price cycle. However, deploying this approach does leave the fund underexposed to firms with extreme levels of operational and financial leverage. As such, the fund may underperform in the short term, during periods with elevated upward Gold price volatility. Mar-18 Performance Data (as at 31 March 2018) Risks to the upside currently look centered on rising geopolitical and economic risks associated with trade tensions. We are monitoring this situation closely as a shift in the macroeconomic picture in the US could alter our expectations for the Gold price this year vis-a-vis a shift in Fed policy from higher inflation and/or lower economic growth. A tone of policy normalization has become prevalent across much of the globe. The steady march away from unconventional monetary policy is already well underway in the US and has begun to enter the rhetoric in the EU. Meanwhile, in Japan, years of loose monetary have cast off the threat of deflation and resulted in rising consumer confidence and GDP. This all points to an environment of rising nominal yields, which would ordinarily be negative for Gold. FTSE Gold Mines Index The value of units may go down as well as up. Past performance is not indicative of future performance. Source: AmFunds Management Berhad Fund (%) *Benchmark (%) 2017 2016 2015 2014 2013 -3.28 43.89 -18.35 -11.35 -41.21 -1.24 66.36 -3.40 -9.52 -49.67 *FTSE Gold Mines Index Source Benchmark: *AmFunds Management Berhad Source Fund Return : Novagni The Fund Performance is calculated based on NAV-to-NAV using Time Weighted Rate of Return (''TWRR'') method Income Distribution History Payout(sen) Source: Deutsche Investment Management America Inc (Target Fund’s Investment Manager) FY 2011 7.00 * Based on the NAV of the preceding financial year end Source: AmFunds Management Berhad Total(sen) - 7.00
  2. Disclaimer Based on the Fund ’s portfolio returns as at 28 February 2018, the Volatility Factor (''VF'') for this Fund is 32.8 and is classified as "Very High" (Source: Lipper). Very High includes funds with VF that are more than 10.615 (Source: Lipper). The VF means there is a possibility for the Fund in generating an upside return or downside return around this VF. The Volatility Class (''VC'') is assigned by Lipper based on quintile ranks of VF for qualified funds. VF is subject to monthly revision and VC will be revised every six months. The Fund’s portfolio may have changed since this date and there is no guarantee that the Fund will continue to have the same VF or VC in the future. Presently, only funds launched in the market for at least 36 months will display the VF and its VC. The information contained in this material is general information only and does not take into account your individual objectives, financial situations or needs. You should seek your own financial advice from an appropriately licensed adviser before investing. You should be aware that investments in a unit trust fund carry risks. An outline of some of the risks is contained in the Master Prospectus dated 10 September 2017 & 1st Supplemental Master Prospectus dated 4 January 2018 (collectively referred as the “Prospectus”). The specific risks associated with investment of the Fund are industry-specific risk, currency risk, risk of a passive strategy, risk of not meeting the Fund's investment objective, Shariah non-compliance risk and counterparty credit risk as contained in the Prospectus. Please also refer to the specific risks of the Target Fund before investing. Unit prices and income distribution, if any, may rise or fall. Past performance of a fund is not indicative of future performance. Please consider the fees and charges involved before investing. Units will be issued upon receipt of completed application form accompanying the Prospectus and subject to terms and conditions therein. Where a distribution is declared, you are advised that following the distribution, the Net Asset Value (“NAV") per unit will be reduced from cum-distribution NAV to ex-distribution NAV. Where a unit split is declared, you are advised that following the issue of additional units, the NAV per unit will be reduced from pre-unit split NAV to post-unit split NAV. Kindly take note that the value of your investment in Malaysian ringgit will remain unchanged after the distribution of the additional units. You have the right to request for a copy of Product Highlights Sheet for the Fund. You are advised to read and understand the contents of the Product Highlights Sheet and the Prospectus before making an investment decision. The Prospectus has been registered with the Securities Commission Malaysia, who takes no responsibility for its contents. You can obtain a copy of the Product Highlights Sheet and the Prospectus from any of our representative office and authorized distributor. AmFunds Management Berhad does not guarantee any returns on the investments. In the event of any dispute or ambiguity arising out of the other language translation in this leaflet, the English version shall prevail. Note: All fees, charges and expenses disclosed in this material are expressed on a Goods and Services Tax (“GST”)-exclusive basis. Accordingly, to the extent that services provided are subject to GST, the amount of GST payable on any related fees, charges and/or expenses will be payable by the unit holder(s) and/or the Fund (as the case may be) in addition to the fees, charges and expenses disclosed in this material. Privacy Notice: AmFunds Management Berhad (Company Registration: 154432-A) issued its Privacy Notice as required by Personal Data Protection Act 2010, which details the use and processing of your personal information by AmFunds Management Berhad. The Privacy Notice can be accessed via www.aminvest.com and is also available at our head office. If you have any queries in relation to the Privacy Notice of AmFunds Management Berhad, please feel free to contact our Client Service Officers at Tel: +603 2032 2888 OR e-mail: enquiries@aminvest.com. Growing your investments in a changing world