STANLIB Index Investments launches new global range


STANLIB Index Investments, a leading provider of index and quantitative solutions in South Africa,is listing five new global exchange traded funds (ETFs) across various asset classes on the Johannesburg Stock Exchange. In addition to the ETFs, five unit trusts will be available as an alternative vehicle for investors to access global markets. The launch expands STANLIB’s local index offering of ETFs and unit trusts.

STANLIB Index Investments global funds are low cost vehicles that offer access to global markets in a single fund. Local investors do not need to be experts in global securities or pay prohibitively high costs to benefit from global investment returns.

The funds are designed to provide investors with diversified exposure to global markets, including developed market equities, government bonds, information technology and global real estate. Each fund is benchmarked to a well-known index that provides simple and transparent access to global markets.

 

STANLIB Index Investments global funds at a glance


  • STANLIB MSCI World Index Feeder ETF/Fund
    Captures large and mid-cap representation across 23 developed markets and covers 85% of the free float-adjusted market capitalisation of each country.
  • STANLIB S&P500 Index Feeder ETF/Fund
    Access to the top 500 leading US listed companies and captures approximately 80% of available market capitalisation.
  • STANLIB S&P500 Info Tech Index Feeder ETF/Fund
    Access to 13 information technology sectors in the US in various fields, including internet software and services, home entertainment software, data processing, hardware, communications and equipment.
  • STANLIB Global REIT Index Feeder ETF/Fund
    Tracks the performance of listed real estate companies and real estate investment trust (REITs) worldwide across countries in developed and emerging markets.
  • STANLIB Global Government Bond Index Feeder ETF/Fund
    Access to the Group of seven government bonds in the United States, Canada, France, Germany, Italy, Japan and the United Kingdom. It captures 85% of the market value of the World Government Bond Index.

 

Accessing the global economy


99.9% of global economic output comes from outside South Africa

5 largest economies by GDP United States, China, Japan, Germany, United Kingdom

The multi-coloured areas on the map represent the diverse country exposures of STANLIB Index Investments global range. The area in black on the map is South Africa. Source: World Development Indicators database, World Bank, 15 December 2017

All funds are feeder funds that invest in underlying ETFs chosen for having long successful track records and being a leader in their respective category. A feeder fund structure enables STANLIB Index Investments to manage the funds more efficiently.

The funds are denominated in South African rand (ZAR) and are regulated by the Financial Services Board. They offer investors the benefits of a rand hedge and offshore diversification, but are structured to be ‘onshore’ funds to allow South African investors easy and instant exposure to securities and currencies in global markets without using their foreign exchange limit or requiring foreign exchange clearance.

 

The case for geographic diversification


SA vs Global stocks: FTSE/JSE SWIX index minus MSCI World index

Source: STANLIB, Bloomberg

Global investing can be an effective way to diversify your existing investments and provide a means to profit from faster growing economies around the world. The development of the world’s economies and interconnectedness of its markets have made it attractive to invest a portion of a portfolio in global funds. High returns are not always found in local markets. Investing outside of South Africa can expand your investment portfolio’s growth potential, while diversifying your investments across the globe can reduce your overall portfolio risk.

 

How to use global funds


You can build an entire investment portfolio using the STANLIB Index Investments range of funds. STANLIB Index Investments funds are excellent tools for implementing a variety of both long term and short term investment objectives. For example, funds can be used as core building blocks for long term asset allocation, or they can be used to implement short term tactical bets. The amount of global exposure that is right for you depends on your risk tolerance and objectives. If you require broader exposure, you can buy global funds that provide access to several geographies in one investment, for example the STANLIB MSCI World Index Feeder ETF/Fund and the STANLIB Global Government Bond Index Feeder ETF/Fund. A diversified global portfolio allows you to benefit more broadly from markets, without exposing you to undue risk in a single country or sector. For most investors this is an attractive long term strategy. For a more focused strategy approach, investors can pursue a single-market ETF, for example the STANLIB S&P500 Index Feeder ETF/Fund, or single sector ETFs, for example the STANLIB S&P500 Info Tech Index Feeder ETF/Fund or the STANLIB Global REIT Index Feeder ETF/Fund.

 

How to invest


Investing in STANLIB Index Investments ETFs can be done via your broker or on an online share trading platform such as Standard Bank’s Online Share Trading.

To invest in STANLIB Index Investments unit trusts email UTbrokersupport@stanlib.com for queries and instructions. Alternatively you can invest via the STANLIB Platform.

 

Contact us


STANLIB Index Investments is a leading provider of index solutions in South Africa, with over R40billion of assets under management. STANLIB Index Investments is part of the Standard Bank, Liberty and STANLIB group of companies. The experienced team specialises in designing and managing index, smart beta and quantitative investment strategies. The team has been managing money in similar strategies since 1995, and has over 70 years of collective experience in financial markets.


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