Satrix launches industry-first ETF

In a first for South Africa, Satrix has listed a global balanced fund as an exchange-traded fund (ETF) on the JSE.

The Satrix Global Balanced Fund of Funds ETF was listed on the JSE on Wednesday. 

“The fund is designed to cater to those looking to hedge against rand weakness and participate in offshore markets through a well-diversified, long-term strategy,” the company said.

“Balanced funds offer investors diversified exposure to different asset classes in an optimal blend.” 

Satrix said it is now using its portfolio design skills and index tracking capabilities to introduce a global balanced fund in a low-cost ETF vehicle, a first for the local market.

“Satrix has a venerable track record in managing balanced funds, and this new global fund follows the same approach,” said Head of Portfolio Solutions at Satrix, Nico Katzke. 

“We’ve applied our in-depth research and focus on strategic asset allocation to build a well-diversified offshore portfolio for South African investors.” 

“The goal is to offer a balanced, risk-diversified global blend of asset classes, including equities, bonds, listed infrastructure, and listed property.” 

He said this ETF is the ideal low-cost solution for those seeking balanced exposure to global assets with a long-term investment horizon.

The ETF consists of a 45% allocation to developed markets, 10% to emerging markets, 5% to global listed property and 10% to listed infrastructure, with property and infrastructure providing the ETF with real asset exposure.

 The fund offers medium long-term global exposure through a diversified portfolio curated using Satrix’s strategic asset allocation methodology. 

As with previous Satrix offerings, there is no minimum investment, making the ETF accessible to a broad range of investors.

Another selling point for this ETF is the fund’s ability to access lower dividend withholding tax rates, allowing investors to benefit from enhanced returns.

“ETFs continue to become increasingly attractive for investors seeking diversified and cost-effective investment solutions,” said the JSE’s Business Development and Exchange Traded Products Manager, Adèle Hattingh.

“With this listing, the JSE is providing an avenue for direct engagement with global markets, enhancing our ability to meet the sophisticated needs of modern investors.” 

The number of ETFs listed on the JSE now stands at 117, with a market cap exceeding R193 billion.