Satrix INDI

By: Satrix  11-11-2011

Satrix INDI endeavours to replicate the performance of the FTSE/JSE Industrial 25 index. This index comprises the top 25 industrial companies listed on the JSE.

Satrix INDI accurately replicates the FTSE/JSE INDI 25 index, by holding the shares in this index in exactly the weighted and number they constitute the index. Dividends paid by the underlying companies, less expenses incurred by managing the portfolio, are paid out to Satrix INDI shareholders on a quarterly basis.

Investors who purchase and hold Satrix INDI securities accordingly, obtain the performance and yield of the top 25 industrial companies in the JSE with the convenience and low cost of a single trade.

Buy Satrix INDI and own the industrial sector of the JSE!!

WHY YOU SHOULD OWN SATRIX INDI?

FTSE/JSE Industrial 25 Index

The FTSE/JSE Industrial 25 index provide a focused portfolio of shares in the industrial, retail and manufacturing sectors of the South African economy. Over the past twenty years, the Industrial index has provided an annual average return of 17,0% per annum and 19,2% over the past 30 years. In recent times, this sector of the JSE has provided superior performance as the run-up to the World Cup in 2010 provides a boost to industrial companies.

This improving performance reflects the gradual shift in the SA economy towards a more competitive production and manufacturing sector, aided by the macro-economic discipline and low inflation environments. The current and future emphasis on job provision, infrastructure capacity-building and gearing up for the 2010 World Cup, indicates that industrially orientated companies might continue to perform well in the years ahead.

The Industrial 25 index contains no mining, financial and resource based shares and therefore provides a focused entry to the domestic South African economy. It also contains a number of middle-capitalisation companies that do not qualify for the Top 40 index, and therefore helps spread the exposure of the investors to some of the better performing smaller shares on the JSE.



Performance

The three year performance of the Satrix INDI has been outstanding, reflecting the good value in industrial shares that existed back in 2003 before the present market upswing. The annual performance has slowed a bit over the past year, but the potential for future growth looks promising.

 
1 year return33.92%34.87%
3 year return15.31%15.97%
5 year return17.33%17.87%
**Fund established February 2002. Returns calculated for lump sum investments. All dividends reinvested.



Low Cost
 

Satrix Indi does not charge substantial management fees or other advisory and ongoing costs, common to other managed investments. The income Satrix earns from scrip lending activities further reduces the cost to the investor.

There are two levels of costs that will be incurred by the investor. The first being portfolio expenses and the second being fees that you will incur depending on the investors preferred channel of investment.

Portfolio expenses
Portfolio expenses include fees incurred to run the Satrix Indi portfolio such as management fees paid to Satrix Managers, custodian fees, brokerage, auditor’s fees, bank charges and taxes.
All these fees are permissible deductions from the portfolio and are paid from the dividends that accrue to the portfolio (from the underlying shares in the portfolio) and the other income that accrues to the portfolio (interest and scrip lending income). The balance of the income remaining in the fund after deduction of the permissible fees and costs referred to above is distributed to the holders of the Satrix securities. This distribution is done on a quarterly basis.

Therefore the portfolio expenses are incurred by the investor when the distribution is paid out. For investors to be informed of this cost on a quarterly basis, the unit trust industry uses the concept of a total expense ratio (TER). TER is used to illustrate the costs of portfolios on a comparative basis. Its objective is to endeavour to satisfy the requirement of transparency and to establish an industry standard. The TER of the Satrix Indi for the quarter ended 30 June 2011 is 0.456% (incl. VAT).

In accordance with the industry standard, brokerage and scrip lending income are excluded from the TER. Satrix accordingly also publishes an actual expense ratio (AER), which includes brokerage expenses and scrip lending income.  The AER is therefore the actual cost to the investor. The AER for the quarter ended 30 June 2011 is 0.4128% (incl.VAT)

Satrix Investment Plan and broker fees
Broker fees, financial advisor fees (applicable if a financial advisor has been consulted) and Satrix Investment Plan fees are costs that will be incurred by the investor depending on the investors preferred channel of investment and does not include the portfolio expenses as set out above.

Broker fees and financial advisor fees could vary depending on the broker and/or financial advisor being consulted.

In the case of the Satrix Investment Plan, which is administered by Automated Outsourcing Services (AOSL), transaction costs (brokerage) of 0,1% is levied on purchases and sales of Satrix securities. Annual management fees, charged by AOS, are as follows:  

Investment Plan Administration Fees

(for both lump sum and debit order investments)


Annual administration fee:

(calculated daily and deducted quarterly)

 
R0 to R100 0000.80%
R100 000 to R250 0000.75%
R250 000 to R1 000 0000.70%
R1 000 000 to R3 000 0000.50%
R3 000 000 or more0.45%


Transaction Fees
Debit order fee: R3.50
Stock brokerage fees: 0.10% (buying and selling)
Nominal Strate and Investor Protection levies will also be charged.
Where a financial adviser is used, commissions will be charged (as scheduled in Section 8).
All fees quoted are exclusive of VAT. VAT will be levied where applicable

Satrix INDI is traded all day on the JSE and its price is subject to trading in the marketplace. The price of Satrix securities can be obtained from any media publication that reports JSE prices. Satrix Managers (Pty) Ltd is registered as a Financial Services Provider.


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