The Laurium Income Prescient Fund aims to achieve a return of CPI+3% p.a through a full interest rate cycle, while providing stability by aiming never to lose capital over any 3-month rolling period. The fund is regulation 28 compliant.
The Fund aims to preserve capital with low volatility of returns and a low correlation to equity markets through all market cycles. To achieve this objective, the Fund will primarily consist of income-oriented assets, including but not limited to debt securities, debentures, additional tier 1 capital instruments, money market instruments, bonds (including inflation linked bonds), property, preference shares, and derivatives.
The Fund will have a low exposure to equity markets including preference shares as determined by legislation, from time to time. It will predominately invest in SA markets but is permitted to include investments in offshore jurisdictions subject to investment conditions determined by legislation, from time to time.
The strategy is one of active management, aiming to generate performance by taking interest rate views (adjusting duration), enhancing yield via credit instruments and forecasting economic cycles to benefit widening or narrowing of credit spreads, determining appropriate asset allocation between income producing asset classes, utilising offshore exposure and making use of derivatives.