GRADIDGE-MAHURA MODEL PORTFOLIOS

We believe that while some things are great on their own, they are even better together. This is one of our key values. We are in this together and, therefore, your success is our success.

Through our strategic partnership with Analytics Consulting, we can offer our clients a range of investment solutions, suited to all risk profiles.

Analytics Consulting is an independent investment consulting and product development business that provides investment consulting services and bespoke product solutions to the top independent financial advisory and boutique investment management businesses in South Africa. The Analytics Consulting team originated from Ninety One (previously Investec Asset Management) stable and includes technical specialists who have worked for some of the top financial services businesses in South Africa, including Allan Gray, RMB, Stanlib, Momentum, PPS Investments and Stonehage Flemming.

OUR INVESTMENT PROCESS

The solutions are proactively managed by an Investment Committee comprised of a number of investment specialists with proven track records. Gradidge-Mahura Asset Management and Analytics Consulting acts as the investment managers of the Investment Committee. We believe that the combination of skills within the Investment Committee brings a positive dynamic and broad industry experience to our offering.

The Gradidge-Mahura solutions are subject to rigorous qualitative and quantitative analysis that facilitates the selection of quality unit trust funds and instruments within the solutions.

The investment process is aimed at providing clients with scientifically designed risk profiled investment solutions that are robust, yet dynamic in terms of adapting to changes in investment market cycles. Gradidge-Mahura Asset Management will manage investment solutions with risk profiles that are matched to the typical risk and return needs of conservative, cautious, moderate and growth investors.

Each of the solutions have a pre-determined strategic asset allocation that is monitored on an ongoing basis to maintain its risk profile. In addition to the strategic asset allocation, the Investment Committee monitors the macro economic environment with a view to determining whether tactical asset allocation changes are necessary. Qualitative and quantitative manager research is done on a continuous basis.

The investment committee aims to achieve an appropriate degree of diversification while combining the investment expertise of quality investment managers. The solutions may have exposure to equities, property, bonds, cash and offshore investment instruments.

THE GRADIDGE-MAHURA FUNDS/MODEL PORTFOLIOS HAVE THE FOLLOWING CHARACTERISTICS:

Gradidge-Mahura Ci Cautious Fund
The objective of this multi asset low equity fund is to provide investors with income and conservative capital growth while focussing on capital preservation. The fund aims to generate a return of CPI* + 2% per annum, after cost, over any rolling 3-year period. This portfolio maintains a low risk profile and will comply with Regulation 28 of the Pension Funds Act.

The portfolio will have a maximum of 40% exposure to equities.

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Gradidge-Mahura Ci Moderate Fund
The objective of this multi asset medium equity fund is to provide investors with moderate capital growth. The portfolio aims to generate a return of CPI* + 3% per annum, after cost, over any rolling 5-year period. The portfolio maintains a moderate risk profile and will comply with Regulation 28 of the Pension Funds Act.

The portfolio will have of a maximum of 60% exposure to equities.

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Gradidge-Mahura Ci Growth Fund
The objective of this multi asset high equity fund is to deliver long term capital growth. The portfolio aims to generate a return of CPI* + 5% per annum, over any rolling 7-year period. The portfolio maintains a high-risk profile and will comply with Regulation 28 of the Pension Funds Act.

The portfolio will have a maximum of 75% exposure to equities.

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Gradidge-Mahura Income Portfolio (Model Portfolio)
The objective of this multi asset income portfolio is to provide investors with income while focussing on capital preservation. This portfolio maintains a low risk profile.

The portfolio will have a maximum of 10% exposure to equities.
The breakdown of the underlying funds selected within the above-mentioned portfolio is available on the Gradidge-Mahura monthly fund fact sheets, as well as on your investment statements.

Gradidge-Mahura Worldwide Flexible Portfolio (Model Portfolio)
The objective of this worldwide flexible portfolio is to deliver long term capital growth through equity centric investments. The portfolio aims to generate a return of CPI* + 5% per annum, after cost, over any rolling 10-year period. The portfolio maintains a high-risk profile. The portfolio will have an equity exposure of anything ranging between 0% and 100% and has no limitations in terms of offshore allocations.

The breakdown of the underlying funds selected within the above-mentioned portfolio is available on the Gradidge-Mahura monthly fund fact sheets, as well as on your investment statements.

*The consumer price index (CPI) is the official measure of inflation in South Africa.

THE BENEFITS OF INVESTING IN THE GRADIDGE-MAHURA FUNDS/MODEL PORTFOLIOS

Flexibility
Our structure is able to access all the top funds and fund managers in South Africa. Gradidge-Mahura unit trust funds can access investment portfolio solutions that are not available to model portfolios, giving the funds access to a larger investable universe.

Furthermore, if you are entering a model portfolio, once you have signed the investment mandate, Analytics Consulting, in consultation with Gradidge-Mahura, will have the authority to manage your investment on a discretionary basis, subject to your portfolio’s predetermined investment mandate and the decisions made by the Investment Committee. This enables us to manage your investment more efficiently without having to revert to you every time that we need to make necessary changes to your portfolios in your best interest.

Liquidity
By investing in unit trust funds, other than in extraordinary circumstances, you can switch out of your investment portfolio within 2 – 5 days. As is the case with your current investment, your investment may however still be subject to certain regulatory liquidity constraints.

Capital Gains Tax
Capital Gains Tax (CGT) is incurred whenever you sell units of a fund, unless you are invested in the solution through a pre- or post-retirement fund product (retirement annuity, preservation fund, etc). It is important to therefore note that CGT events will be incurred by certain investors whenever Gradidge – Mahura makes changes to their model portfolios. We do, however, believe that it is unwise to delay making necessary changes to your portfolio merely to avoid CGT accruals. On an annual basis, Allan Gray and Stanlib will notify all relevant investors of the CGT that has been incurred on their portfolios. If you are invested in the Gradidge-Mahura unit trust funds, no GCT will be payable until you sell units from your investment.

Costs
The investment committee is committed to keeping fees of the solutions low while providing superior risk adjusted returns. Using our scale, we can access the Ci Institutional building blocks (certain of which are passive investments) which reduces the fees for investors within the Gradidge-Mahura solutions.

For a complete breakdown on all the fees, please refer to the client mandate, the fund factsheet or minimum disclosure document (MDD). If you have any further queries relating to the total costs applicable to your portfolio, please do not hesitate to contact your financial advisor.

Transparency
At any point in time, you will be able to calculate the performance of your solutions and the actual constitution of your investment solutions.

Administration
We have an established range of investment solutions on the Allan Gray and Stanlib administrative platforms. These investment solutions will facilitate the active management of our clients’ capital.

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