Page 172 - Profiles's Unit Trusts & Collective Investments - September 2024

CHAPTER 9

conviction, is that our funds own a diversified collection of top quality, proven long-term
sustainable businesses, with amazing owners and leaders, strong balance sheets, and that are
currently priced cheaply in the markets. As a result, we are confident to state clearly that our funds
offer significant absolute and relative long-term investment value to its aligned long-term fund
investors. Our investment objective is for the fund to deliver a long-term total return over full
market cycles to its long-term fund investors after all costs and inflation of 5% per annum or
better.
Are equity markets in general overpriced? Do you anticipate a significant correction or will
the bull-run continue?
Our bottom-up valuation informed work leads us to believe that leading global market indices
are overvalued at present, and that geopolitical risks are elevated, in our humble estimation. We
have absolutely no idea about the short-term direction of market indices, and we do not believe
that anyone else does either regardless of what they may think and say. We do know that we will
act accordingly depending on whatever unfolds in the future – whether the indices go up, sideways,
or down.
Which asset classes do you expect will give the best total rates of return over the next few
years?
We believe our selected fund equities will continue delivering the best total long-term rates of
return to our long-term fund investors, closely followed by our selected property equities.
Could you identify three shares that fall within your universe that you think will perform well
in the medium term?
We never know in advance which of the shares we own will do the best over any future time
frame, and we are not willing to pretend otherwise or mislead ourselves or anyone else. We would
caution the reader not to read into our public disclosures of individual fund holdings, as we are
completely focused on construction a sufficiently diversified portfolio of balanced opportunities
and risks.
As per our June 2024 fund MDD, which is public knowledge, our three largest fund exposures
to individual shares at that point in time were to Growthpoint, Emira and Remgro.

Plexus Wealth BCI Property Fund
Sector: South African–Real Estate–General
Portfolio manager: Plexus Wealth
Benchmark: FTSE JSE J253T
Returns to investors 1 year 3 years
Plexus Wealth BCI Property Fund 24.35% 11.78%
Sector Average 22.30% 9.8%
Inflation (CPI) 5.10% 5.96%
ProfileData performance stats to 30 June 2024: CAGR with dividends reinvested

Please describe your investment universe.
The investment universe spans all the property-related sectors of the JSE, and which are
covered by such benchmark indices as the FTSE/JSE SAPY Index, the FTSE/JSE Real Estate
Investment Trusts Index and the FTSE/JSE All Property Index. Furthermore, it includes the
flexibility to invest in: a) selected high-yielding ordinary equities (up to a maximum of 20%), b)
collective investment schemes, which means that the fund can invest in property-related ETFs
should some additional diversification be required, and c) fixed income securities.

170 Profile’s Unit Trusts & Collective Investments — Understanding Unit Trusts