STANLIB launches new fund to offer higher yield to corporate treasuries
The STANLIB Corporate Enhanced Yield Fund is:
- Managed by Eulali Gouws and Ansie van Rensburg, part of STANLIB’s award-winning Fixed Income Investment team, led by Victor Mphaphuli.
- The fund is particularly appropriate for a company’s core and strategic cash balances. Its slightly longer duration makes it an ideal investment for sums that can be set aside for 3-6 months.
- Ideally suited for corporates seeking returns in excess of money market funds, while maintaining a conservative investment mandate and high liquidity.
- The fund will follow a conservative strategy, with exposure to longer-dated fixed income instruments restricted to bank- and government exposure only.
“Money market funds have long been favoured by South African corporates for optimising returns on operational and short-term cash positions,” says Charlene Klöhn, STANLIB’s Head of Corporate Cash Solutions.
“However, with corporates tending to maintain cash balances for longer periods, there is benefit in investing in enhanced yield funds, without compromising liquidity. The STANLIB Corporate Enhanced Yield Fund was launched to target longer term cash seeking out returns exceeding money market rates, while offering next-day liquidity,” says Klöhn.
STANLIB’s Corporate Enhanced Yield Fund will follow a conservative strategy, targeting returns above those currently available from money market funds. It will invest mainly in money market instruments, but the returns will be enhanced by employing slightly longer duration management.
“In a nutshell, the fund offers potential for higher returns, diversification, active management, and support in stabilising cash flows. From a risk perspective, the fund’s exposure to longer-dated fixed income instruments will be restricted to bank- and government-issued instruments only. It has a provisional credit rating of AA-(ZA)(f) from GCR Ratings,” says Klöhn.
Eulali Gouws and Ansie van Rensburg are the portfolio managers of the fund. They are part of STANLIB’s award-winning* Fixed Income Investment team, led by Victor Mphaphuli. With R273 billion in assets under management (AUM), the STANLIB Fixed Income team is the largest in SA and has essentially been together for 20 years, following a consistent process and philosophy which has resulted in consistent performance and benchmark-beating returns.
“As specialist fixed income managers, the STANLIB team manages funds across the fixed income universe. This breadth of scope, combined with an experienced team of portfolio managers, researchers and credit experts, provide deep insight into the market environment, helping to identify opportunities that could easily be missed if you focused on one area. The STANLIB Corporate Enhanced Yield Fund will give corporates access to these opportunities and enable them to achieve higher yields on the cash under there management,” concludes Klöhn.
* The STANLIB Fixed Income team has won:
- 27four Investment Managers’ Sustainable Asset Manager Award for 2022
- Morningstar Best South Africa Bond Fund award for 2020
- Victor Mphaphuli, Head of Fixed Income, was awarded the Fixed Income Manager of the year 2019 by the Association of Black Securities and Investment Professionals (ABSIP)