An analysis by Daily Investor showed that Ninety One’s global equity fund outperformed Coronation and Allan Gray. However, they all underperformed against index trackers over five years.
Coronation, Allan Gray, and Ninety One are three of the biggest asset managers in South Africa, with billions under management.
They all offer offshore equity funds, meaning their holdings are denominated in US dollars and managed outside of South Africa.
Local investors can, therefore, benefit from capital growth through equity performance and the depreciation of the rand versus the US Dollar.
Coronation’s fund is domiciled in Ireland, Allan Gray’s in Bermuda, and Ninety One’s in Luxembourg.
Another advantage of these offshore funds is that they can be domiciled in tax-efficient jurisdictions with lower tax rates than in South Africa.
The bad news for South African investors who put their money with Coronation, Allan Gray, and Ninety One is that they performed significantly worse than the MSCI World and S&P 500 indices.
It would, therefore, have been far better for investors to invest their funds in an MSCI World or S&P 500 index tracker than in one of these global equity funds.
Coronation Global Equity Select Fund
This fund aims to give investors exposure to global equity markets to maximise long-term growth and outperform the global equity benchmark over all periods of 5 years and longer.
The fund is biased towards developed markets, with 70% of its holdings being in Europe and North America. 58% is invested in the United States alone.
- Benchmark – MSCI All Country Index
- Total Investment Charge (TIC) – 1.46%
- Fund size – $889 million
Allan Gray Orbis Global Equity Fund
The Orbis Global Equity Fund aims to give exposure to all of the risks and rewards of global equities by being fully invested in global equities at all times.
As with Coronation’s global equity fund, this fund is heavily biased towards developed markets, with 84% of funds invested in developed economies. 42% is invested in the USA.
The fund aims to outperform global equity markets over the long term.
- Benchmark – MSCI World Index
- Total Investment Charge – 1.03%
- Fund size – $5.3 billion
Ninety One Global Equity Fund
Ninety One’s global equity fund aims to achieve growth by investing in shares of companies on a global basis.
As with the other funds, this fund is heavily invested in developed markets, with 90% of funds invested in Europe, the USA, and Japan. 55% is invested in the United States alone.
- Benchmark – MSCI AC World Net Return
- “Ongoing charge” – 0.99% (may incur further expenses not included in this charge, the maximum charge is 5%)
- Fund size – $748 million
|1 year||3 years||5 years|
|iShares MSCI World||-7.22%||10.00%||7.09%|
|iShares S&P 500||-7.71%||12.12%||9.79%|