Unit trusts are divided into identical units, which investors can buy or sell at any time. The amount that you contribute and the unit price at the time of investment will determine the amount of units allocated to you. When you invest in a unit trust fund, the value of your investment is not guaranteed as the unit price will fluctuate. Unit trusts are generally medium to long-term investments.
Unit trusts are designed to offer good value. Because funds from a variety of investors are pooled, investment managers are able to buy a range of assets that would normally be unaffordable for investors in an individual capacity.
Unit trusts invest in a broad range of investments. In this way, risk is spread across many investments rather than just one or only a few. If one investment performs poorly, the fund may not necessarily underperform as the other investments may have done very well.
Unit trusts are among the most flexible and convenient investment vehicles available. Investors can make additional deposits, stop investing, switch between funds or withdraw at any time without incurring penalties.
Unit trusts do not have minimum investment periods and you can withdraw your funds at any time.
Unit trusts are managed by highly-qualified investment managers, who have the necessary expertise and experience to make sound investment decisions. Very few investors have the time, skills or experience to actively manage their investments on a daily basis.
You can track the performance of your unit trust fund on a daily basis on investment websites, the press or on the relevant asset manager’s website. Personal Finance publishes a unit trust performance table every weekend in the Saturday newspaper.
Unit trusts are required to appoint trustees, generally an independent financial institution, to protect investors’ interests. A trustee acts as custodian of a fund’s assets, which are held in the name of the trustee and not in the unit trust management company. In this way, if the management company goes under, investors’ money will be safe as it is held in a trust.
A trustee’s main responsibility is to ensure that the fund is managed appropriately and to report any significant irregularities to the FSB.
We have two Sharia-compliant unit trust funds that are managed in accordance with Sharia investment guidelines. This means that companies that do not comply with Sharia law are removed as investment options and the remaining stocks are evaluated according to a series of financial ratio filters. Our funds are mindful of the avoidance of interest or Riba.
With our Sharia funds, all income deemed to be non permissible is stripped out of our funds on a weekly basis and is held in a separate bank account for six months. The accumulated amount is then donated to the Kagiso Trust and/or other registered charitable organisations on our investors’ behalf. Our Sharia Advisory and Supervisory Board meets bi-annually to select the beneficiary organisations and approve the donations.
All permissible income earned within our funds is declared in June and December each year and then distributed among investors on the first business day of July and January.
We accept lump sum (minimum of R5 000) and/or regular debit orders (minimum of R500 per debit order). The application form contains more details on the payment options available to you.
Alternatively, contact our Client Service team on 0800 864 418 or email email@example.com to request statements.
You can track the performance of your unit trust fund by accessing the fund fact sheet on our website, under the Document download section. We update these fact sheets on a monthly basis and they show each fund’s performance over one, three and five-year periods. They also show the fund’s performance since inception.
Your investment is subject to an annual management fee. This fee differs for each fund and is built into the daily unit price. Our funds’ annual management fees are disclosed in the application form, investment terms and conditions documents and on the funds’ fact sheets.
We do not charge initial investment, administration, switch or withdrawal fees.
Financial adviser fees
If you have a financial adviser, you need to negotiate and agree on the initial and annual ongoing advice fees you will pay. This is an agreement between you and your financial adviser and we will facilitate the payment of fees to your adviser.
- The initial advice fee is restricted to a maximum of 3% of your investment amount and will be deducted before it is invested. We will then pay the amount over to your financial adviser.
- The annual ongoing advice fee is restricted to a maximum of 1% of the value of your investment. However, if your initial advice fee is above 1.5%, your annual ongoing advice fee will be restricted to a maximum of 0.5%. This fee will be deducted monthly by selling units in your fund(s) and we will pay it over to your financial adviser.
Your quarterly investment statements will reflect the fees deducted from your investment over the respective period. You may request a schedule of fees and charges at any time from our Client Service team on 0800 864 418 or at firstname.lastname@example.org.
We declare income in June and December each year and this is distributed on the first business day of July and January. However, if a fund’s total expenses exceed its income, it will not make a distribution.
In the case of our Islamic funds, we will deduct all income deemed to be non permissible from the total income distribution in order to comply with Sharia law. The remaining balance will then be distributed according to the investor’s preference. As required by Sharia law, all non-permissible income deducted will be donated to the Kagiso Trust and/or other registered charitable organisations on our investors’ behalf.
- lump sum investments
- debit order investments
- reinvestment of income distributions
- switches between funds
- personal detail revisions
Regular withdrawals are restricted to a minimum of R500 per withdrawal per fund. You may select a monthly, quarterly, bi-annual or annual withdrawal. To set up a regular withdrawal, please complete the Regular Withdrawal Payments section of our Investment Application Form.
To make withdrawals on an ad-hoc basis, you will need to complete the Withdrawal Form. Payments will be made within two business days of us receiving your completed form and the required supporting documents. Please note that the payment may only reflect in your bank account at a later date and this will depend on which bank you use.
However, if you wish to invest within a retirement fund vehicle (ie a preservation provident/pension fund or retirement annuity) or purchase a living annuity, you can select any one of the Kagiso unit trust funds as an underlying investment on the following investment platforms:
- Allan Gray
- Absa Investment Management Services