Question about fund prices

chrisc

chrisc

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Wife invested R1m into a Nedbank offshore fund in August 2015. At that time, the fund price was 1914c

Today, the fund price is 2107c

Yet today's statement shows that the value of her investment has decreased to R 916000

The website states that fees amounting to 1.6% have been deducted

Inquiring with Nedbank as to the anomoly gets "we will call you back" which does not happen

Any suggestions from an independant financial person?
 
chrisc said:
Wife invested R1m into a Nedbank offshore fund in August 2015. At that time, the fund price was 1914c

Today, the fund price is 2107c

Yet today's statement shows that the value of her investment has decreased to R 916000

The website states that fees amounting to 1.6% have been deducted

Inquiring with Nedbank as to the anomoly gets "we will call you back" which does not happen

Any suggestions from an independant financial person?
Click to expand...

Yeah they all are thieves! I just found out that from the growth of my RA 19.5% were deducted for "fees". This is at Allan Gray.

Watch, Nedbank will blame the Economy, They R/$ exchange rate or whatever!

With the fund price which rose from 1914c to 2107c should have given you quite a lot of growth I reckon!
 
From personaly and family experience dealing with Nedbank, our conclusion is that Nedbank is run by a bunch of thieving lawyers. Take your money back asap and put it somewhere more trustworthy.

My experience
 
Last edited:
chrisc said:
Wife invested R1m into a Nedbank offshore fund in August 2015. At that time, the fund price was 1914c

Today, the fund price is 2107c

Yet today's statement shows that the value of her investment has decreased to R 916000

The website states that fees amounting to 1.6% have been deducted

Inquiring with Nedbank as to the anomoly gets "we will call you back" which does not happen

Any suggestions from an independant financial person?
Click to expand...
Sure.

Global Cautious feeder fund right?

You lost 8.4%.

Firstly:
The underlying fund of the portfolio is USD-denominated and therefore this feeder fund is subject to currency
fluctuations. Rand strength will have a negative impact on the rand-denominated performance and rand weakness a
positive impact
Click to expand...

The exchange rate is roughly the same during August 2015 and now (by some miracle) but given FX spread and exact days you may have lost a percent or three there.

The fees are 1.539% initially and 1.824% annually. Not 1.6%...go read it carefully. So since August 2015 that's roughly 5.187 if we ignore compounding.

Given that it's a fund benchmarked against 1m US libor you'd expect near zero growth in the underlying assets.

So taking all that together that's broadly consistent with the 8.4% loss. Sucks but seems accurate.

As for why the "fund price" moved differently...no idea. Might be some fund specific mechanism that I'm not aware of but I reckon chances are better that one of those numbers are wrong (or are from different points in time).

Where do I send the invoice for my time? :p
 
Thank you. I posed the same question to Nedbank investments

Reply one simply enclosed another copy of the statement which I had already received and did not answer any of the questions
Reply two stated incorrectly that there had been multiple investments into the account. This is not correct since there was only one
Reply three stated that the prices I quoted were "bizarre". I spoke to this lady and asked her to look at the Fund Price download CSV file relating to this particular fund. This took her 20 mins to find. I asked her to look at the price at the inception date and whether it corresponded with the figure on my email. She said I did not understand, fund prices do not have any correlation to fund performance. I asked the question again and she then asked me if I was certain this was the fund I was inquiring about, which I confirmed (there is only one investment). She told me she could not improve on her previous answer and if that was all
Cheeky bitch
 
chrisc said:
Thank you. I posed the same question to Nedbank investments

Reply one simply enclosed another copy of the statement which I had already received and did not answer any of the questions
Reply two stated incorrectly that there had been multiple investments into the account. This is not correct since there was only one
Reply three stated that the prices I quoted were "bizarre". I spoke to this lady and asked her to look at the Fund Price download CSV file relating to this particular fund. This took her 20 mins to find. I asked her to look at the price at the inception date and whether it corresponded with the figure on my email. She said I did not understand, fund prices do not have any correlation to fund performance. I asked the question again and she then asked me if I was certain this was the fund I was inquiring about, which I confirmed (there is only one investment). She told me she could not improve on her previous answer and if that was all
Cheeky bitch
Click to expand...
:/

Well I guess ultimately it boils down to the same outcome...investment did badly.

Anyway...the part that is of more interest to you: Next step. You can pull the money, but on balance I'd say foreign exposure isn't a bad plan. My personal view is that the ZAR is going to get fk'd so staying put seems like a sound plan. The better question is whether there are more cost efficient options available. 1.6% for some generic FX exposure is a little heavy. Personally I'd investigate the fee structure of the easyequities foreign share thing (or FNB - apparently they do foreign too). I'm guessing you can park the money in a vanguard ETF for much cheaper and get the same basic results. I should also point out that since the underlying is basically making 0% all you're doing here is taking a bet on which way the FX goes. Not sure that's the risk appetite you were aiming for since you sound pretty conservative?

That's probably crappy advice though. You should totally speak to a professional.
 
If the figures you supplied here are correct, Nedbank has a lot to answer for.

If this is indeed the Nedbank Global cautious feeder fund, then the 1.6% management fee shown on the website is already deducted from the fund prices you quoted.

If your fund prices are correct the investment gained 10% after fund management fees.

The other fees they would have charged, and deducted from this 10% return are platform fees and adviser fees. These should not add up to more than+- 2% over this period, but your discrepancy is +- 17% - Nedbank has to give a full explanation.

Please post their answers here.
 
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