Our recommended investment portfolios have produced another year of good outperformance above the industry average.
The Aggressive and Moderate portfolios outperformed the industry average by 6.0% and 6.8% for the year to December 2015. This was due to our +35% offshore weightings which benefited significantly from the Rand’s 28% weakening against global major currencies.
The Conservative portfolio outperformed the industry average by 1.4% for the year to December 2015. This portfolio continued to produce a very creditable return in excess of 9% per annum for the last 1, 3 and 5 years.
Overall our recommended portfolios continue to outperform on average in excess of 2% per annum over the last 3 and 5 years. Please see our portfolio performance table below.
| To Dec 2015 | 1 Year | 3 Years* | 5 Years* |
|---|---|---|---|
| IOL Aggressive Portfolio | 7.8 | 14.5 | 14.8 |
| Industry average | 1.8 | 10.3 | 10.8 |
| Outperformance | 6.0 | 4.2 | 4.0 |
| IOL Moderate Portfolio | 14.6 | 14.2 | 14.2 |
| Industry average | 7.8 | 12.0 | 11.7 |
| Outperformance | 6.8 | 2.2 | 2.5 |
| IOL Conservative Portfolio | 9.1 | 9.8 | 9.9 |
| Industry average | 7.7 | 9.3 | 9.7 |
| Outperformance | 1.4 | 0.5 | 0.2 |
Portfolio recommendation changes
Our Aggressive, Moderately Aggressive and Moderate portfolios have had direct offshore investment exposures of 36%, 50% and 38% respectively. The 28% average depreciate of the Rand over the last year has been the main reason for the strong performance of these diversified portfolios of 7.8%, 17.4% and 14.6%.
We believe the Rand has now weakened too quickly and is undervalued, which leads us to reduce our direct offshore exposure in our Aggressive, Moderately Aggressive and Moderate portfolios to 25%. This decision to reduce our offshore US$ exposure in the above 3 portfolios taking place at 16.60 to the US$/ZAR in early January 2016.
Please click here to enquire about our updated recommended portfolios.
