Fund investing prudently

By ZARA KANU LEBO
THE limited availability of foreign exchange continues to restrict National Superannuation Fund’s (Nasfund) ability to fully capitalise on international opportunities.
Under the fund’s Strategic Assets Allocation (SAA) for international investments, it is investing at 11.85 per cent of its net asset value, which is well within both the prudential standard limit of 35 per cent and the board’s limit of 15 per cent.
Nasfund board chairman Tamzin Wardley said investing the full 15 per cent in international markets could have generated an additional K41.7 million in income, translating to a 0.64 per cent increase in crediting rate.
“This scenario underscores the substantial opportunities that lie ahead as we continue to navigate and adapt to the evolving economic landscape,” she said.
“The investment division will intensify efforts to identify and assess opportunities in Financial Year 2024 while remaining vigilant in monitoring market conditions and adjusting our investment as needed to ensure we are maximising returns for our members while also managing risk.”
Nasfund invests 85 per cent of its portfolio overseas in a fund which is called vanguard and exchange trade funds (ETF). So far, Nasfund has invested K160 million overall in foreign investment.
The two fund managers are expert brokers and invest overseas on behalf of the superfund thus buying and selling during market hours and potentially lowering the risks and exposure while helping to diversify the portfolio.
Nasfund chief executive officer Rajeev Sharma said the fund did not do direct investment, “because you have to be there physically to do that”.
“So we basically invest the funds through the managed brokers and that is the road most superfunds take in terms of investing members’ funds for the growth of the superfund,” he said.
“What happens in that case is that we don’t go and invest direct in Microsoft or Apple. The funds we invest are left to the experts to manage and so I have less to worry about.
“If I’m going to invest in one company, I’ll have to pick a time when to buy and sell and I’ll have to have several people doing that, but if you invest in mutual funds, they have fund managers whose job is to pick up the time of buying and selling and which sector to invest in.
“Recently there has been a lot of growth in the IT sector, the software boom, which is going on currently so definitely all the funds were invested in there and they have given a better return for us.”