www.capricornfundmanagers.com 1
The information contained in this document are the views of the fund manager and does not constitute financial advice as contemplated in terms of the Financial Advisory and Intermediary Services Act, and should be read in conjunction with the MDD. Use of or reliance of this information is at own risk. Independent professional financial advice should be sought before making any investment decision.
Manager's Comments
South Africa (SA) endured its first full month of lockdown in April a�ter the initial three-week period was extended for two weeks and the country then moved to a phased re-opening at month-end with extremely limited additional economic activity. But even with the economy grinding to a halt, global risk appetite returned and SA equity markets were dragged along with the rising tide. The FTSE/JSE All Share Index was up 13% for the month (its best monthly return since 2003), with the bulk of the heavy li�ting done by the resource shares. Gold miners were up over 50% in aggregate for the month and platinum shares jumped 38% MoM. Naspers put in another solid month and is now up almost 30% YTD. The only major index components to disappoint in April were the food retailers and pharmacies which had a tough month a�ter missing the initial sell-o�f in March. The Clicks Group announced results, which were fairly robust given the circumstances, but the board’s decision to omit the interim dividend and not to provide the usual full-year guidance was taken very negatively by the market. To so�ten the economic blow in SA, the South African Reserve Bank (SARB) delivered a 1% interest rate cut in April, following its 1% rate cut in March, bringing SA’s o�ficial interest rate to a record low of 4.25%. SA 10-year bonds saw their yield drop 0.7% to 10.3%, with foreign selling somewhat muted ($0.6bn for April) into SA’s much-anticipated month-end exit from the World Government Bond Index a�ter March’s credit downgrade by Moody’s. In fact, foreigners sold almost six times as many bonds in the month leading into the downgrade than they did in the month since the downgrade. Despite limited foreign selling in local equity and bond markets and strong global risk appetite, the rand still managed to breach $19/$1 several times during April before ending 3.7% MoM weaker at R18.81/$1. In this environment the fund performed well, returning 11.7% for the month. Contributors to the gains were broad-based, but our significant holdings in Naspers, the PGM sector and the PSG Group contributed materially. The PSG Group surprised the market by announcing that it is seriously
considering unbundling its 31% stake in Capitec. We believe that this is a very prudent move by PSG management and still see significant value in the share. Losses were predominantly focused in our short portfolio. We are cautious on the aggressive recovery experienced by global equity markets. Although we acknowledge that global central banks, including the SARB, have reacted aggressively and �lushed the world with liquidity, we are concerned that the market is too optimistic on how quickly the world will return to normal. Although we are confident that our current portfolio will generate attractive returns in the long term, the shorter term returns may be far more volatile. As such, we have decided that it is prudent to hedge a significant portion of our portfolio using various option structures. These structures should enable us to participate significantly if we are wrong and the market continues to rally, but will help to protect us should the market sell-o�f again in the near future. We thank you for your continued support.
Objective
Summary Statistics
The CAPRICORN SANLAM COLLECTIVE INVESTMENTS PERFORMER QUALIFIED HEDGE FUND is a Rand denominated South African long/short equity hedge fund. The Portfolio has a strong focus on long term capital appreciation, targeting an absolute return in excess of cash. The Portfolio aims to provide returns with lower volatility and lower drawdowns than equities.
Fund
(16,7%)
1 YEARRETURN
4.1%Benchmark(CPI)
R68mCURRENT NAV
N/A
(0.9%)
3 YEARANNUALISED
RETURN
4.2%
(2.7%)
3 YEARCUMULATIVE
RETURN
13.0%
ANNUALISED*RETURN SINCE
INCEPTION
11.0%
5.2%
CUMULATIVERETURN SINCE
INCEPTION
124.8%
47.8%
Date: 30/04/2020 Source: Maitland Fund Services (Pty) Ltd and Capricorn Fund Managers (Pty) Ltd*Annualised Return is calculated from the historical returns of the fund since inception and is the annual growth rate that gets you from the initial investment value to the ending investmentvalue if you assume that the investment has been compounding annually over the time period.
• Fund Performance
Capricorn Sanlam Collective InvestmentsPerformer Qualified Hedge Fund April 2020
www.capricornfundmanagers.com 2
2012
2013
2014
2015
2016
Italicized returns are net returns for the previously unregulated fund Date: 30/04/2020 Source: Maitland Fund Services (Pty) Ltd and Capricorn Fund Managers (Pty) Ltd.
Historical Monthly Returns
Oct Nov DecJan Feb Mar Apr May Jun Jul Aug Sep BenchmarkYTDYTD
2017
2018
2019
2020
2.4%
5.3%
5.8%
4.8%
6.6%
4.6%
5.2%
3.6%
1.9%
20.4%
40.6%
11.9%
38.0%
(15.5%)
19.6%
(5.5%)
4.2%
(13.6%)
1.4%
5.0%
2.2%
1.3%
0.4%
(0.8%)
2.7%
3.2%
4.3%
0.6%
(4.8%)
6.1%
(4.7%)
2.4%
1.7%
0.1%
7.8%
5.5%
4.1%
7.6%
(0.4%)
5.9%
(4.7%)
3.1%
0.8%
1.6%
(0.4%)
3.3%
(1.4%)
0.0%
(0.0%)
(0.4%)
4.7%
0.9%
0.9%
(0.5%)
1.2%
5.3%
4.1%
(5.3%)
2.0%
(1.7%)
5.1%
(3.3%)
3.1%
0.4%
(1.4%)
0.6%
3.9%
1.8%
(2.2%)
(2.2%)
0.3%
0.4%
9.5%
6.6%
(0.9%)
6.4%
0.2%
(4.4%)
(3.2%)
1.3%
0.5%
2.7%
(3.3%)
2.6%
0.1%
3.5%
11.7%
4.8%
0.5%
2.0%
1.9%
0.7%
(1.7%)
1.2%
(15.9%)
2.5%
6.2%
2.9%
(4.9%)
1.0%
1.0%
0.2%
(9.3%)
0.6%
(5.7%)
1.7%
(5.7%)
0.2%
(4.6%)
3.4%
1.4%
Graphical Representation of Historical Monthly Returns
Date: 30/04/2020 Source: Maitland Fund Services (Pty) Ltd and Capricorn Fund Managers (Pty) LtdImportant Information: Past performance is not necessarily a guide to future performance.
Annualised Return Cumulative Returns Benchmark
60%
50%
70%
80%
40%
30%
20%
10%
0%
120%
140%
160%
180%
100%
80%
60%
40%
20%
0%
Aug
12
Oct
12
Dec
12
Feb
13
Ap
r 13
Jun
13
Aug
13
Oct
13
Dec
13
Feb
14
Ap
r 14
Jun
14
Aug
14
Oct
14
Dec
14
Feb
15
Ap
r 15
Jun
15
Aug
15
Oct
15
Dec
15
Feb
16
Ap
r 16
Jun
16
Aug
16
Oct
16
Dec
16
Feb
17
Ap
r 17
Jun
17
Aug
17
Oct
17
Dec
17
Feb
18
Ap
r 18
Jun
18
Aug
18
Oct
18
Dec
18
Feb
19
Ap
r 19
Jun
19
Aug
19
Oct
19
Dec
19
Feb
20
• Fund Performance
Capricorn Sanlam Collective InvestmentsPerformer Qualified Hedge Fund April 2020
www.capricornfundmanagers.com 3
Frequency Distribution ofMonthly Returns Since Inception Assets Under Management (R Million)
Gross exposure Net Exposure% of positive months% of negative monthsAverage positive monthly returnAverage negative monthly returnAnnualised monthly volatility (historic)Sharpe RatioMaximum monthly drawdownMaximum cumulative drawdown
R68m207%
77%70%30%
2,8%(3,4%)13,7%
0,6(15,9%)(25,4%)
Statistics
Date: 30/04/2020 Source: Maitland Fund Services (Pty) Ltd and Capricorn FundManagers (Pty) Ltd
Launch Date: (Regulated Fund) 01/09/2016Inception Date: 01/08/2012
-5%
to -4
%
-6%
to -5
%
-3%
to -2
%
-4%
to -3
%
-2%
to -1
%
-1%
to 0
%
0% to
1%
1% to
2%
2% to
3%
3% to
4%
4% to
5%
5% to
6% 6%+
-6%
+
Freq
uenc
y %
Return Bands
• Fund Performance
Capricorn Sanlam Collective InvestmentsPerformer Qualified Hedge Fund April 2020
www.capricornfundmanagers.com 4
Contact Information
Investment ManagerCapricorn Fund Managers (Pty) Limited25 Culross RoadBryanstonSandton2191South Africa
For enquiries please contact
Management CompanySanlam Collective Investments(RF) (Pty) LimitedT: +27 21 916 6910E: [email protected]
Stephan EngelbrechtT: +27 11 591 0554E: [email protected]
Licensed by the Financial Sector Conduct AuthorityLicense number: 863
Important InformationSanlam Collective Investments (RF) (Pty) Ltd registered and approved Manager in Collective Investment Schemes in Securities. Collective investment schemes are generally medium- to long-term investments. Past performance is not necessarily a guide to future performance, and that the value of investments / units / unit trusts may go down as well as up. A schedule of fees and charges and maximum commissions is available from the Manager on request. Collective investments are traded at ruling prices and can engage in borrowing and scrip lending. The Manager does not provide any guarantee either with respect to the capital or the return of a portfolio. Performance is based on NAV to NAV calculations with income reinvestments done on the ex-div date. Performance is calculated for the portfolio and the individual investor performance may di�fer as a result of initial fees, actual investment date, date of reinvestment and dividend withholding tax. Performance fees are calculated at 20% above the benchmark performance (CPI). Lump sum
investment performances are being quoted. Sanlam Collective Investments retains full legal responsibility for this co-named portfolio. The portfolio management of the fund is outsourced to Capricorn Fund Managers, an authorised financial services provider in terms of the FAIS Act. The Manager has a right to close the portfolio to new investors in order to manage it more e�ficiently in accordance with its mandate. The information contained within this document has been prepared by Capricorn Fund Managers (Pty) Ltd and is unaudited. Returns as shown are the weighted average of all issued series. The 2015 fund of the year Award was given in February 2016 and full details and basis of the award are available from the Manager. The 2017 South African Long/Short Equity Fund award was given in February 2018 and full details and basis of the award are available from the manager.
• Fund Performance
Capricorn Sanlam Collective InvestmentsPerformer Qualified Hedge Fund April 2020