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Investment Indicators - 7 May 2018 |
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An investment in knowledge pays the best interest - Benjamin Franklin |
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Distributed to 52,197 subscribers.
To advertise with us
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| Rates Review |
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1. Secured Investment Rates |
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Please note that (G) indicates a Guaranteed and (L) a Linked product. In order to understand the difference between guaranteed and linked rates,
kindly click here for an explanation. |
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Company |
This Week |
Last Week |
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Clientéle Life (L) |
6.820% |
6.720% |
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2 |
1Life (L) |
6.780% |
6.680% |
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3 |
Absa (L) |
6.464% |
6.362% |
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Company |
This Week |
Last Week |
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Discovery (G) |
6.902% |
6.899% |
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2 |
Clientéle Life (L) |
6.900% |
6.820% |
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1Life (L) |
6.780% |
6.680% |
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2. Money Market Funds |
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Please bear in mind that our figures, though based on the actual quotations that you also use, are for information purposes only,
and can never replace the official quotation from the product house. In terms of the guarantees, you are requested
to clarify the exact extent of such guarantees with the product house prior to advising clients. |
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From the Crow's Nest |
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Local Hedge Fund Statistics - Decline in assets under
management |
The Association for Savings and Investment South Africa (ASISA)
released the 2017 statistics for the local hedge fund industry on 23
April 2018. It was the hedge fund industry’s first decline in assets
under management since 2011.
The South African hedge fund industry ended 2017 with assets
under management of R62.4 billion, a decline of R5 billion from the
R67.4 billion managed at the end of 2016.
The 2017 statistics for the local hedge fund industry, released by
the Association for Savings and Investment South Africa (ASISA)
today, show that this was the hedge fund industry’s first decline in
assets under management since 2011 when assets stood at only
R31.4 billion.
Outflows as a result of poor performance
Eugene Visagie, convenor of the ASISA Hedge Funds Standing
Committee, comments that poor fund performance in 2016 and 2017,
mainly by the larger equity long/short funds, resulted in investors
withdrawing capital and moving it to more traditional asset classes.
According to Visagie, hedge fund performance has been muted since
2016 following events such as Nenegate, Brexit and the election of
President Donald Trump. In addition, he says, the majority of hedge
fund managers did not anticipate the rally in the rand last year.
He points out that fixed income was the best performing strategy in
2017 and therefore also received the most net inflows.
Visagie says hedge funds apply a number of different specialist
strategies to asset classes such as equities, bonds, cash and
property with the aim of mitigating the impact of market volatility.
The most common hedge fund strategy in South Africa is referred to
as “equity long/short”. At the end of December 2017, 60.4% of hedge
fund assets was invested in this type of strategy, while 14.1% was
invested in fixed income.
He cautions that hedge funds are designed to protect capital by
outperforming the markets during times of heightened volatility.
“However, when financial markets deliver strong performances hedge
funds are unlikely to show similar results,” he concludes.
Transitioning to a regulated environment
Visagie says the industry faced another year of consolidation in
2017 as it continued to transition to the regulated environment.
In April 2015 South Africa became the first country to put in place
comprehensive regulation for hedge fund products. The new
regulations provide for two categories of hedge funds, namely
Qualified Investor Hedge Funds and Retail Investor Hedge Funds.
This required the hedge fund industry to prioritise the conversion
of hedge fund products to structures that conform to the provisions
of the Collective Investment Schemes Control Act (CISCA).
“The implementation of the new regulation has led to some hedge fund
managers consolidating their product offering,” says Visagie.
Under the new hedge fund regulation, 295 hedge fund portfolios have
been approved by the former Financial Services Board (FSB).
By the end of December last year, 99% of hedge fund assets had
transitioned to regulated structures – 69% of hedge fund assets had
been allocated to Qualified Investor Hedge Funds and 30% to Retail
Investor Hedge Funds. The remaining 1% completed the transition
during the early part of 2018.
Visagie remains positive about the growth prospects of the local
hedge fund industry, despite the challenges facing hedge fund
managers.
“The industry is still small, but it has the potential to be a key
role player in the South African savings industry. This is where the
new regulation is of particular importance as it provides a
much-needed structure for making hedge funds marketable to new
investors.” |
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| Your Practice Made Perfect |
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Moonstone Regulatory Update Workshops – Can you afford to miss it? |
Many FSPs believe that the new Fit and Proper regime is just more of the
same and really only adds class of business training, product specific
training and CPD to the Fit and Proper mix. This is a grave
underestimation of the extent to which Board Notice 194/2017 changes the
financial services landscape.
True, it does bring in these additional training requirements but it
also adds new product categories, creates product tiers, changes
financial soundness requirements, introduces the concept of “good
standing” and redefines the operational ability requirements for FSPs.
All of these elements constitute new compliance requirements which will
need to be complied with and reported on.
The Board Notice does not make for easy reading and understanding how
the pieces of the puzzle that is Fit and Proper fits together is no
simple task.
Moonstone Compliance will host another round of its very popular
regulatory update workshops during June 2018.
As regular attendees have come to expect, we will once again share what
you need to know in a practical and understandable manner to allow you
to make informed decisions on how the changes and proposed changes will
impact you and your business.
This year our workshops will be accredited by a recognized body and will
qualify as a CPD activity towards the accumulation of CPD hours as
required by the FSCA.
The workshops will again be facilitated by Billy Seyffert and Alan
Holton and will cover:
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A concise overview of: |
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The Insurance Regulations, the impact and what’s next? |
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The most important PPR
considerations |
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Debarments – What has changed? |
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Financial Sector Regulation Act – What is important to
me? |
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The proposed changes to the General Code of Conduct and
the impact on FSPs |
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An in-depth unpacking of the 12 elements of the New Fit
and Proper Requirements and what it will take to comply. |
The workshops will run from 09h00 until 13h00 and take place on the
following dates and venues:
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VENUE |
DATE |
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East London - EL Golf Club |
5 June 2018 |
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Port Elizabeth - PE Golf Club |
6 June 2018 |
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Cape Town - The River Club |
18 June 2018 |
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Johannesburg - Houghton Golf Club |
19 June 2018 |
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Pretoria - Diep in die Berg |
20 June 2018 |
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Durban - Coastlands Hotel Umhlanga |
21 June 2018 |
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Bloemfontein - Emoya Estate |
26 June 2018 |
Please save the date.
Registration is expected to open this week. |
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FSCA E-portal Hitches
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The Financial Sector Conduct Authority has indicated that they are
currently experiencing challenges with their e-Portal as it is being
upgraded. Clients are advised to forward annual financial statements or
compliance reports that are due to either
Faisfins1@fsca.co.za ,
Faisfins2@fsca.co.za or
Faiscomp1@fsca.co.za till further notice. |
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FSCA warns against Unlicensed Foreign FSPs
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According to the FSCA’s Caroline da Silva “no person may in any manner
or by any means, whether within or outside the republic, canvass for,
market or advertise any business related to the rendering of financial
services by any person who is not an authorised financial services
provider or a representative of such a provider,” she noted. This was
her recent comment to Moneyweb’s Patrick Cairns when it came to light
that an international wealth manager, Chase Buchanan, was offering
services to South African clients without being authorised and as a
result is in contravention of the Financial Advisory and Intermediary
Services (Fais) Act.
Although the FSCA does not regulate consumers and consumers can receive
financial advice from any firm, local or international, consumers will
unfortunately have no recourse to lodge a complaint with the local
authorities should anything go wrong.
Click here to read the Moneyweb article. |
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Regulatory Examinations |
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Preparation Guides Updated Regularly |
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Please note that the FSCA’s Regulatory Examination Preparation
Guides are updated regularly.
This is a process that is set to continue as new questions, stemming
from the Fit and Proper requirements are added to the question data
bank.
The development of questions is a lengthy process to ensure that the
quality of the REs as a professional exam is not affected negatively.
Please also note that certain words and phrases used in the previous
Guides, as well as in study material, had to change as a result of the
introduction of the Financial Sector Regulation Act. Please see the
table below for more details.
Please familiarise yourself with the following changes.
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OLD TERMINOLOGY |
NEW TERMINOLOGY |
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FSB |
FSCA |
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Registrar |
Commissioner |
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Financial Services Board |
Financial Sector Conduct Authority |
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Registrar for FSPs |
Commissioner of the FSCA |
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Registrar for Financial Services Providers |
Commissioner of the Financial Sector Conduct
Authority |
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RE Deadline 30 June 2018 |
The table below indicates who has to successfully complete the RE 5 by
30 June 2018.
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Representatives’ DOFA |
RE 5 Deadline |
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30/06/2015 – 31/12/2015 |
30/06/2018 |
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01/01/2016 – 29/06/2016 |
30/06/2018 |
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30/06/2016 – 31/12/2016 |
30/06/2019 |
DOFA refers to your date of first appointment. For instance,
if you were appointed on 1 September 2015, you actually have
two years and nine months in which to pass the RE 5 for
representatives.
Unfortunately, time is now running out for those who are
compelled to pass in less than two months.
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Remember that bookings close about two weeks before the
actual exam, for logistical reasons. For instance, yesterday
we closed bookings for 17 May.
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Not everyone passes at the first attempt. If you wish to
give yourself enough time to re-register in such an event,
bear in mind that you should allow for time for your paper
to be marked and the results sent to you. This means that
you should try and write by 8 June, given that our venues
have always been fully booked in the last few weeks of the
DOFA deadline.
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How to prepare for the REs |
The
FSCA Preparation Guide recommends the following approach:
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STEP |
ACTIVITY |
DESCRIPTION |
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Refer to the
mapping document for the exam you are planning
to write. |
This is the map of
the tasks/criteria that will be assessed in your
exam, and it contains a reference to the
relevant legislation that you are required to
study in order to understand the task /
criteria. Appendix A in the Preparation Guide |
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2 |
Look at the number
of criteria for each task. |
These are the
knowledge and skill components you require to be
able to perform.
RE 1 has 16 tasks that will be tested
RE 5 has 8 tasks that will be tested
If you have studied all the criteria for every
task, then you would be properly prepared to
write the RE1 or RE5 – whichever exam applies to
you. |
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To prepare for the
exam, you must spend time each day and study the
legislation and supporting training material.
One should systematically select one criteria at
a time. |
Group the criteria
together in groups of 3 or 4 and allocate study
hours per day to prepare. The total number of
hours will individually differ due to ones
circumstances. At least 2 hours per day is the
suggested number of hours. |
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To start, read the
task, and then the first criteria. Then refer to
the legislation for these criteria, and read the
legislation referred to. |
It is important to
first read the legislation so that you can see
what terms are used and how the legislation is
structured. |
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5 |
Now refer to the
additional support or training material (for
example the INSETA training material) and study
the section in the training material dealing
with those particular criteria. |
The support
material explains the particular concepts in
simple language so that it is easier to
understand what the legislation is actually
saying and what it means. |
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6 |
Then go back to the
legislation itself, and read it again. |
Now that you have
gained a better understanding of what the
legislation is about, you may find reading the
legislation again will make more sense to you if
you didn’t understand it the first time around. |
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2018 Schedules updated |
Please note: Registration cut-off is 11 working days before date of exam.
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Careers Platform
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Are you hiring? Advertise your position on Moonstone’s Career Platform
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The Moonstone website -
www.moonstone.co.za
- enjoys an average of 20 000 visits and approximately 39 000 page views per month. |
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Moonstone boasts an exclusive newsletter mailing list of over 51000
dedicated financial decision makers who receive 2 newsletters per week. |
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Our audience is relevant and industry specific: individual and corporate advisors and brokers in the following financial sectors:
iInvestment, Risk, Healthcare, Banking, Retirement, and Insurance. |
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Featured Positions |
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Broker Consultant:
CIA - Commercial & Industrial Acceptances, KZN Umhlanga - We are
looking for a candidate with at least 5-10 years working experience in
the insurance industry, short term insurance qualifications and RE1.
Read More
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Offshore Property
Consultant:
Salesforce Recruitment Johannesburg and Durban - This is your
opportunity to offer a unique, capital growth investment opportunity to
the market without bumping heads with direct competitors.
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International Buy to
Let Sales Consultant:
Salesforce Recruitment Johannesburg and Durban - Join this stable,
Offshore Property Investment House and elevate your sales career to the
next level.
Read More
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In Lighter Wyn |
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Irish Birthday Toasts |
If, like me, you find it difficult to write something special on a
Facebook friend’s birthday wall, copy these. Just make sure you
don’t use the same one for the same person next year:
Irish Birthday Toasts
May you live to be 100 years, with one extra year to repent.
We drink to your coffin. May it be built from the wood of a hundred
year old oak tree that I shall plant tomorrow.
May the doctor never earn a pound out of you.
May the good Lord take a liking to you... But not too soon!
May you see your children’s children, May you be poor in misfortune,
rich in blessings. May you know nothing but happiness from this day
forward.
May the joys of today be those of tomorrow and the goblets of life
hold no dregs of sorrow.
May you live as long as you want, and never want as long as you
live.
And a personal favourite:
May you die in bed at 95, shot by a jealous spouse.
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Tel: +27 21 883 8000 | Fax: +27 21 883 8005
info@moonstoneinfo.com
www.moonstone.co.za
P.O. Box 12662, Die Boord, Stellenbosch, 7613, Republic of South Africa
Disclaimer:
Services and products advertised by external product suppliers in
this newsletter are paid for by the respective suppliers. Moonstone
does not endorse any opinions, conclusions, data, products, services
or other information contained in this e-mail which is unrelated to
the official business of Moonstone and furthermore accepts no
liability in respect of the unauthorised use of its e-mail facility
or the sending of e-mail communications for other than strictly
business purposes.
The complete disclaimer can be accessed
here. |
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©2015 Moonstone. All rights reserved. |
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