Pointbreak Money Market Fund remains resilient in volatile markets

 Pointbreak Money Market Fund remained resilient in volatile markets and the fund yields have dropped by only 0.55 per cent over the comparable three month period, Tony Edmunds of Pointbreak Wealth at FisrtRand Namibia Group said.

Edmunds, in a media statement availed to Nampa on Friday, said that forecasting models indicate that the fund’s yield should under current market conditions experience a gradual decrease over the next few months.

“The fund’s investment strategy and maturity duration of 133 days should, however, result in the yield falling at a slower pace compared to the bank deposit rates. Investors benefit from the fund’s maturity profile consisting of longer-dated, higher-yielding money market deposits and securities. The fund has always been competitive and should remain so, compared to local cash and other money market alternatives,” he said.

He added that in light of current economic uncertainties and market conditions the fund has increased the cash reserve to just over 20 per cent of the fund from an average of 15 per cent before the Coronavirus crises

The money market fund yield is influenced by the Bank of Namibia rate cuts as well as market and economic conditions.

“Capital preservation and liquidity will always take precedence over chasing yield. Apart from this slightly more defensive stance the investment strategy has not changed and is consistently applied fund only invests with the four major banking groups in Namibia, five major banking groups in South Africa, Namibia Savings Bank (Nampost) and the Sovereign’s of both countries, as well as other large Money Market funds,” he said.

Edmunds added that fund has as its primary objective to provide money market returns with 24-hour liquidity, with capital preservation and liquidity taking precedence over the maximization of yield.

The fund is managed by Ashburton Unit Trust Management Company Ltd, which is a member of the FirstRand Namibia Group.

Source: Namibia Press Agency