Global Balanced Model Portfolio Trades

Manager Selection revised to align asset allocation and improve TER’s

Mosa Manqindi

Mosa Manqindi

Portfolio Manager Research Analyst

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Global Balanced Model Portfolio Trades

From time-to-time, we interrogate the positioning of our Portfolios to ensure alignment with their stated investment objectives. Occasionally, this interrogation leads to changes in our manager selection decisions. This is the case now.

Our manager selection process is based on a rigorous quantitative and qualitative assessment of the managers available on the Glacier International and Ninety One Global Access platforms. The Baillie Gifford Managed Fund is held in the Global Balanced GBP Model Portfolio and has been a top contributor to performance. Although the fund is a GBP fund, a third of its currency exposure is held in USD and it holds a slightly smaller allocation in GBP. Therefore, the manager allocations for the Global Balanced USD Model Portfolio were reconsidered.

The NFB AM Investment Committee has switched the exposure from the Coronation Global Managed Fund to the Baillie Gifford Managed Fund and has rebalanced toward an equal weighting across the four managers in the Portfolio. The Baillie Gifford Fund’s TER is lower and the switch, in combination with the Schroder Global Cities decision detailed below, is anticipated to reduce total weighted TER’s to 0.82%.

The switch will increase the total weighted equity exposure but it will remain under the mandated maximum of 70%.

In an effort to align the positioning of both the USD and GBP Global Balanced Model Portfolios, the allocation to the Schroder Global Cities Real Estate Fund in the Global Balanced GBP Model Portfolio was removed as it was an historical direct asset allocation position. This will reduce the allocation to global property in favour of global equities.

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