Investment Funds

Historical prices of various investment funds

I collect data on the prices of investment funds I'm interested in, to analyze the long-term trends. However, the price trend of a unit trust is not the whole performance of the fund. The total performance also includes the income distribution, added on top of the growth in the price, so the performance of the funds below is actually higher (income distributions include dividend payouts). I'm an amateur investor (without access to the performance data) so that is why I have tried to compile these graphs, although I believe professional investors have access to the performance data for unit trusts.

Below, I share the graphs I maintain of various historical unit trust prices. Here is the folder which contains the data and information. I tend to focus more on higher-growth and more volatile funds, as my investment horizon is long term (i.e. five years or longer). I'm saving for my next car, and a house for when I'm in my 30s (and I will use these graphs to help me decide when to divest). These graphs are useful in that I think one should buy when the price is below trend, and only sell when the price is above trend. I usually only enter each data point for the first Friday of every month (and there is a delay, since I only do this manually).

A "feeder" fund is one that invests the entire local currency-denominated fund into a global foreign currency-denominated fund.

My philosophy of analyzing prices

  • One can expect the value of an investment to increase exponentially over time. Thus, one should only use an exponential trend line.

  • I believe that a monetary time-series variable (i.e. prices) should be presented with 0 at the bottom of the graph, as only in this way will the viewer be able to see how the variable has changed proportionally over time. The proportional change is ostensibly more important to investors with a long-term horizon—absolute fluctuations are more important for speculators.

  • A real price is one that is not affected by inflation. In contrast, over time, "nominal" prices increase with inflation, as the rand devalues. I restrict my analysis to real prices, as I find inflation a distraction (since the inflation rate changes so much, especially compared to the 1980s). To see how large inflation has been over time, observe the following graph.

Nedgroup Investments

I'm familiar with the range that Nedgroup Investments offers, as I trust them. Wherever you see "Core" in the name, that means the management fee will be low. You can access the information about these funds, and invest in them, at https://www.nedgroupinvestments.co.za/ . I present some basic unit trusts below in increasing order of volatility.

Nedgroup Core Guarded Fund

This fund is 38% equity, 6% commercial property, 27% bonds and 29% the money market. The ratio of foreign assets to domestic assets is 1:4.

Nedgroup Core Diversified Fund

This fund is 66% equity, 8% commercial property, 16% government bonds and 10% the money market. The ratio of foreign assets to domestic assets is 1:3. I think it looks like it is below trend at the moment, so I predict that it could have something like a 4% real return over the next five years, to bring it back up to trend (this fund is fairly conservative, as a pure equity fund can give 6% in the long run). This fund has a management fee of 0.55%. See the fact sheet.

Nedgroup Core Accelerated Fund

This fund is 74% equity, 16% commercial property, 6% government bonds and 4% the money market. The ratio of foreign assets to domestic assets is 2:5. I think it is a good time to buy into this fund, since the price is below trend (the fund would tend to rise in the long-run). This fund has a management fee of 0.67%. See the fact sheet.

The following graphs show global funds. These are denominated in rands, so the prices haven't dropped much during the covid-19 crisis, because the rand weakened at the same time.

Nedgroup Core Global Feeder Fund

This fund is almost completely in foreign markets. It has 62% equity, 10% commercial property, 17% government bonds, 3% corporate bonds, 7% in foreign money markets and 1.4% in the domestic money market. The management fee is only 0.56%. See the fact sheet.

Nedgroup Global Equity Feeder Fund

This fund feeds into the Nedgroup Global Equity Fund, so it exposes one's money to the foreign markets. It is 88% equity (in developed countries, with 54% in the US) and 12% in the foreign money markets. The management fee is 1.63%. See the fact sheet.

Nedgroup Global Diversified Equity Feeder Fund

This fund is a bit newer than the Global Equity Feeder Fund, and is more diversified (i.e. there are many more shares held, each making up a tiny proportion of the total fund). The inception date was only last year, so the average return isn't informative enough to put the chart here. Most of the equity is in the United States (63%), because the US is an advanced, capitalist economy. The management fee is 1.71%. See the fact sheet.

Nedgroup Global Emerging Markets Equity Feeder Fund

Emerging markets (developing countries) are the most volatile, compared to developed markets. But, I think they have more potential in the very long run for higher growth. I would only recommend a time horizon of at least 20 years for the emerging markets. This fund predominantly exposes your money to stocks in Asian countries. In order of size: China (33%), India (12%), Taiwan (11%), South Korea (10%), Brazil (5%), Russia (5%), the foreign money market (4%), Thailand (3%), South Africa (2%), Mexico (2%), the domestic money market (1%) and others (14%). The management fee is 2.1%. See the fact sheet. The inception date for this fund was only in April 2019, so the chart (and average return) isn't really useful.

22Seven is the only app I know of that lets you invest in a unit trust for a minimal amount. At banks, there is at least a R10 000 minimum opening balance for unit trusts, but with 22Seven, you can invest in a unit trust for as little as R250.

Old Mutual Global FTSE RAFI All World Index Feeder Fund

I've invested in this fund from 22Seven, as it is a higher-growth fund, and easily accessible (with the low minimum balance required). It is predominantly equity. The management fee is about 1.1%. See the fact sheet.