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The Guardian Acuity Equity Fund is an open ended unit trust fund that invests in stocks listed in the Colombo Stock Exchange. (CSE)

The Portfolio is actively managed using a bottom up stock selection approach where investee companies are evaluated by the fund managers and research team using fundamental research and the team's extensive experience in capital markets.

Fund Facts

  Performance

Fund cumulative growth since inception (Till end August 2021)

79.14%

Benchmark ASPI cumulative growth since inception (Till end August 2021)

64.29%

Fund CAGR since inception (Till end August 2021)

6.32%

Benchmark CAGR since inception (Till end August 2021)

4.36%

  GENERAL FACTS

Inception Date

February 2012

Fund Size (End August 2021)

LKR 320.21 Million

Investment Objective

Achieving medium to long term capital appreciation

Minimum Investment

LKR 1,000

Trustee

Deutsche Bank

  ASSET ALLOCATION

Equity

40% (MIN) - 95% (MAX)

Cash & Cash Equivalents

5% (MIN) - 40% (MAX)

  FEE STRUCTURE

Management Fee

2.25% per annum

Trustee & Custodian Fee

0.3% per annum

Exit Fee

2% (applicable only for withdrawals during the first year of investing)

To understand the current status of the Fund, refer to the latest Fact Sheet.

Commentary BY FUND MANAGER, ASANKA JAYASEKERA

The month of August saw the All Share Price Index continue to gain ground with a 10.80% performance largely driven by retail investor interest in select large market capitalization companies. These companies have experienced sharp increases on their share prices and continue to do so with optimistic investor sentiment. However, there were a number of stocks with good fundamentals that weakened during the month such as Hemas Holdings, John Keells Holdings and Ceylon Cold Stores where share prices declined by 8.49%, 5.63% and 7.82% respectively. The weakness in these and other stocks contributed to the fund declining by 4.07% during the month of August. The anomaly of investors focusing away from fundamentally stronger stocks and buying companies that are potentially overvalued may continue in the shorter term resulting in deviation between All Share Price Index and fund returns. The announcement of quarantine curfew was also announced during the month as the daily count of Covid-19 positive cases and fatalities saw increases. The impact of the curfew on listed companies as on previous occasions will dampen consumer patterns distorting quarterly results which can impact specific company share prices in the short term. The country continues to strengthen its vaccine rollout and this will be critical in combating the pandemic and supporting the already weakened economy and strengthening investor confidence. Continued economic risks such as external debt repayments, further depletion of reserves, depreciation of the currency and inflationary pressures can be a threat to the equity markets sharp upturn.

Why invest in the Equity Fund

Exposure to multiple stocks

Investment in the Equity Fund provides the investor exposure to all stocks the fund is invested in

Liquidity

Investors can gain exposure to equity without having to worry about liquidity

Switch Between Funds

investors have the flexibility to switch to the money market anytime at no cost in response to capital market movements

Well researched investment decisions

Stock calls are made by fund managers based on thorough research and insights by the internal research team

Hassle free; monitoring and execution

All transactions are executed by a separate operations team


INVESTMENT STRATEGY and stock selection process

In line with the bottom up stock selection approach we follow, the focus is more on identifying fundamentally strong securities trading at reasonable valuations, from a long term perspective.

stock selection process

RISKS OF INVESTING IN THE FUND

investment value is subject to change based on movement in the stock market.

As such the ability of the Fund to achieve its investment objectives will depend on the performance of the equity market, interest rate environment and overall economy.

The Unit price of the Fund can increase as well as decrease depending on the performance of the stock market

Trading on the stock exchange as a whole is subject to the level of liquidity of the market, which at times could be low especially if faced with volatility due to external developments.

This liquidity situation may inhibit the Fund's ability to obtain shares in quantity without having a marked effect on the shares' market price and may further prevent the Fund from being able to liquidate a position at the prevailing market price.

The GUARDIAN ACUITY MONEY MARKET FUND is an open ended unit trust fund that invests in investment grade (Rated BBB- or Above) fixed income securities maturing within 365 days.

NOTE :

Current yield is calculated based on average unit prices of past seven days and it is variable and subject to change

Current yield is based on past performance of the funds and the past performance of the fund should not be taken as indicative of its future performance.

Fund Facts

  Performance

Fund cumulative growth since inception (Till end August 2021)

140.21%

Benchmark cumulative growth since inception (Till end August 2021)

8.49%

Fund CAGR since inception (Till end August 2021)

10.11%

  GENERAL FACTS

Inception Date

February 2012

Fund Size (End August 2021)

LKR 2556.0 Million

Investment Objective

To maximize fund yield at a relatively low risk level

Minimum Investment

LKR 1,000

Trustee

Deutsche Bank

  FEE STRUCTURE

Management Fee

0.60% per annum

Trustee Fee

0.15% per annum

To understand the current status of the Fund, refer to the latest Fact Sheet.

COMMENTARY BY FUND MANAGER, CRISHANI PERERA

As we discussed before for interest rates to increase during 2H2021, Central Bank raised its key policy rates during August by 50 bps, whilst also hiking Statutory Reserve Ratio by 200 bps. The CB cited the need to address imbalances in the external sector, to control build-up of excessive inflationary pressures and improved economic growth prospects as justification to the rate hike. We view the said rate hike as a first step in a monetary tightening cycle. We expect the external sector challenges to prolong with continued bulk USD obligations, further delays in potential recovery in tourism due to the ongoing pandemic and rising pressure on the import bill with increasing in commodity prices. Depreciatory pressure was continuously building on the currency as well, as amidst large USD debt commitments the USD reserve position dropped to USD2.8 bn as of end July 2021 compared to next 12 months net drains of foreign currency amounting to USD6.8 bn. Further a rising import bill added to the pressure, where a notable USD liquidity shortage emerged requiring Central Bank to take several measures to maintain LKR at desired levels. Domestically we can expect fiscal tightening measures in order to ease some pressure from government financing. Accordingly we expect interest rates to continue to trend upwards during rest of 2021 and continue to 2022. Based on above our current fixed income strategy would be to keep majority of the investments in short term liquid instruments and start extending our maturity profile as interest rate cycle is expected to peak in the period ahead. The country announced a lockdown during mid-month with the rapid spread of the COVID-19, whilst also steps taken to accelerate vaccination rollout which is expected to assist controlling the spread which has been the experience in majority of the developed world countries.

INVESTMENT STRATEGY

INVESTMENT STRATEGY

RISKS OF INVESTING IN THE FUND

The ability of the Fund to achieve its investment objectives will depend on the interest rate environment and the performance of the economy.

dividend paid and Unit price of the Fund can increase as well as decrease depending on interest rate fluctuations in the market.

The Fund is subject to interest rate risk, liquidity risk and default risk.

Interest Rate Risk - Changes to interest rates will cause the market values of the instruments in the portfolio to fluctuate which will have a direct bearing on the Unit price of the Fund.

Liquidity Risk - Liquidity risk is the ease at which an instrument can be sold without a significant change in value. The Fund will have a limited exposure to liquidity risk as a result of a higher exposure to more liquid government securities.

Default Risk - Default risk arises from the inability of the debt issuer to meet timely principal and interest payments.

Get In Touch with our Investment Advisors

Guardian Acuity Hotline

011 74 34 734

077 12 34 358

General Contact

011 24 49 500

Registered Office

61, Janadhipathi Mawatha,
Colombo 01.

Corporate Office

Acuity House, Level 5,
No. 53, Dharmapala Mawatha,
Colombo 03.

Subscriptions and Redemptions

guardianoperations@carcumb.com

Customer Complaints

clientservices@carcumb.com