The Liberty Core Conservative is a unit trust that aims to achieve moderate returns while ensuring long-term growth. The fund is managed by STANLIB Asset Management, a role it has held since its inception.
Launched on March 1, 2019, the fund offers two options: Corpsel and Liber, each with its own associated costs. The Liber option carries a 1% management fee, while the CorpSel option charges a 0.60% management fee.
With a focus on low-risk investments, the fund primarily allocates its assets to bonds that provide structured returns. Consequently, the fund complies with Regulation 28, which dictates that retirement investments should have less than 75% exposure to equities and up to 40% exposure to foreign equities.
Retirement vehicles, including pension funds, preservation funds, and retirement annuities, are eligible to invest in the Liberty Core Conservative fund due to its compliance with the regulation.
The fund’s appeal is evident in its portfolio size, as it stands as one of the largest unit trusts within the Liberty range with a fund size of R2.50 billion.
As a conservative fund, the Liberty Core Conservative fund consistently delivers above-average annual returns. Detailed performance information is provided below to provide further insights into the fund’s operations.
Liberty Core Conservative Fund Performance
The Liberty Core Conservative fund, part of the Liberty family of unit trusts, stands out by generating above-average returns compared to other funds of its type. It achieves exceptional growth rates while safeguarding investors’ capital in the long run.
Since its inception, the fund has achieved an average annual growth rate of 10.19%, outperforming the benchmark’s average annual growth rate of 9.39%. Moreover, the fund has surpassed the South African inflation rate, achieving an average annual growth rate of 5.14%.
In total, the portfolio has grown by 48.70% since its inception, surpassing the benchmark’s growth rate of 44.33%. Over this period, the fund has outperformed the benchmark by an impressive 4.37%.
However, it’s important to note that the fund doesn’t consistently outperform the index. This is evident in its performance over a three-year period, during which the fund achieved an average annual growth rate of 11.74%. In comparison, the benchmark experienced a higher average annual growth rate of 12.51%, outperforming the fund by 0.77%.
It’s worth emphasizing that occasional instances of the benchmark outperforming the fund shouldn’t concern investors, especially in the short term. The fund’s long-term results are consistently impressive, consistently surpassing inflation rates and demonstrating steady growth. Therefore, it is advisable for investors to adopt a long-term perspective when investing in the Liberty Core Conservative Fund.
For more detailed information about the Liberty Core Conservative Fund, please refer to the table below.
Liberty Core Conservative Fund Asset Allocation
The Liberty Core Conservative fund primarily invests in equities, which account for 44.59% of the fund. South African equities make up the majority of the equities held.
Local equities represent 25.15% of the portfolio’s assets, making it the second largest investment. Foreign equities account for 19.44% of the fund’s assets.
Bonds constitute the second largest investment in the portfolio, making up 41.8% of the total assets. Local bonds form the majority, accounting for 38.43% of the portfolio, and serve as the fund’s largest asset investment. Foreign bonds represent 5.37% of the fund’s assets.
Cash holds a significant portion of the fund, comprising 7.01% of the portfolio. Local cash accounts for the largest share, representing 6.48% of the total. Foreign cash makes up 0.53% of the fund’s assets.
The Liberty Core Conservative fund has effectively balanced its asset allocation to limit high capital exposure. The fund’s bond investments play a crucial role in maintaining stability by generating consistent returns.
Advantages of Liberty Core Conservative Fund
- The fund exhibits a very low level of risk and invests in well-balanced assets across different sectors.
- It is Regulation 28 compliant, allowing for retirement investments to be made through the account.
- The fund’s historical performance demonstrates its ability to provide favorable returns in the long term.
- Professional managers oversee the fund’s management.
- The management fee is reasonable.
Disadvantages of Liberty Core Conservative Fund
- The fund does not guarantee returns or the preservation of invested capital.
- Fund managers receive their management fees regardless of the fund’s performance.
The Liberty Core Conservative Fund offers an excellent opportunity to grow investments while maintaining a low-risk profile. Managed by top-notch professionals in South Africa’s fund management industry, the fund charges a reasonable management fee.
Historically, the fund has delivered exceptional returns, surpassing the average annual performance of inflation.