| Tue 23 Feb 2010, 15:01 | | GEN - BBET40 - The BettaBeta Equally Weighted Top 40 portfolio - Nedbank |
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GEN - BBET40 - The BettaBeta Equally Weighted Top 40 portfolio - Nedbank
Capital`s new weighted ETF brings balance to Top40 investment
Media release regarding The BettaBeta Equally Weighted Top 40 portfolio
("BettaBeta EWT40") (a portfolio under the BettaBeta Collective Investment
Scheme ("BettaBeta CIS") registered in terms of the Collective Investment
Schemes Control Act, 45 of 2002 ("CISCA"))
Share Code: BBET40
Abbreviated Name: BBEWT40
ISIN: ZAE000144507
Nedbank Capital`s new weighted ETF brings balance to Top40 investment.
It is widely accepted by investors that one of the most convenient ways of
exposing a portfolio to South Africa`s most prominent listed blue chip companies
is via a fund or vehicle that invests in the FTSE/JSE Top40 Index.
Unfortunately, this Index is heavily skewed towards listed companies in the
resources sector, so instead of owning a diversified portfolio of shares, Top40
Index investors often inadvertently find themselves over-exposed to a few large
South African mining companies.
To address this, and offer investors an easy means of effectively balancing
their blue chip exposure across all the companies and sectors making up the Top
40 Index, Nedbank Capital now offers the BettaBeta Equally Weighted Top40
Exchange Traded Fund (ETF). This new offering will be available as from 24
February with the actual listing date being 25 March 2010.
According to Nerina Visser, Head of Beta Solutions at Nedbank Capital, while the
BettaBeta ETF offers the same cost effective investment solution as other ETFs,
and supplements returns on investment via quarterly dividends on all underlying
shares, the true beauty of the fund is its ability to offer investors equal
exposure to SA`s top blue chip shares.
`While it is true that most Top40 Index funds do afford investors exposure to
SA`s leading listed blue chip organisations,` explains Visser, `the composition
of the Top40 Index means that almost 50% of these organisations fall within the
resources sector - and almost 75% of that resources exposure comprises the
shares of just three companies!`
The weighted nature of the BettaBeta Equally Weighted Top40 Exchange Traded Fund
effectively addresses this imbalance, by more equally spreading the exposure
ratio of investments across the 40 shares comprising the FTSE/JSE Top40 Index.
Investors in Nedbank Capital`s BettaBeta ETF therefore enjoy a higher relative
exposure to companies in the financial and industrial sector, while still being
invested, albeit at a lower overall exposure, to the resources companies in the
index.
Visser explains that this more balanced weighting introduces an element of
greater risk management into the investment vehicle, without sacrificing
potential returns or preventing exposure to any of the Top40 shares.
`The BettaBeta Equally Weighted Top40 Index is independently calculated by the
FTSE/JSE,` Visser explains, `and for the year to February 2010, this index has
outperformed the FTSE/JSE Top40 Index - and perhaps as importantly, it has done
so at a lower overall level of risk.`
According to Visser, this weighted, lower risk, approach makes the BettaBeta
Equally Weighted Top40 ETF a particularly useful means by which pension or
provident funds can access passive Top40 Index exposure that suits their more
balanced mandates and benchmarks.
She also points to the BettaBeta Equally Weighted Top40 ETF as a useful vehicle
by which asset managers with a strong stock-specific bet can hedge their funds
via an equally-weighted product, rather than a market capitalization-based
index.
Ends
Notes to Editors
- The BettaBeta Top40 Index comprises exactly the same companies that make up
the FTSE/JSE Top40 index, however, exposure to these shares is calculated
in equal proportions of 2.5% each*.
The basket of shares is rebalanced quarterly in line with the quarterly
review of the FTSE/JSE Africa Index Series, and the shares underlying the
BettaBeta Equally Weighted Top40 ETF will also change in line with changes
to the FTSE/JSE Top40 Index, based on changes implemented by the FTSE/JSE
Indices Advisory Committee.
*The only exceptions being Investec plc and Investec Limited, which are
held jointly to make up a 2.5% overall exposure to the shares of Investec.
- Nedbank Capital`s BettaBeta Equally Weighted Top40 ETF is not a hedge fund.
It is merely based on an index that makes it a suitable investment for
managers in the hedge fund industry.
- The BettaBeta Equally Weighted Top40 Index has been independently
calculated by FTSE/JSE since April 2009. A history since 31 December 2002
has also been created and the comparison to the performance of the FTSE/JSE
Top 40 Index in the above article includes this history for the period
February to March 2009.
- Although the performance of the BettaBeta Equally Weighted Top40 Index
exceeds that of the FTSE/JSE Top 40 at times, it may also underperform the
latter. However, the risk (as measured by the standard deviation) is always
lower.
- Investing in Nedbank Capital`s BettaBeta Equally Weighted Top40 ETF
- BoE Personal Stockbrokers (or your own stockbroker)
- www.boepersonal.co.za or Helpdesk 011 480 3722/5
- Through etfSA
- www.etfsa.co.za or Call centre 0861 ETFSA 1 / 0861 383 721
For more information please contact
Nerina Visser
Head: Beta Solutions: Nedbank Capital
Tel: +27 11 294 3217
Mobile: +27 83 630 6599
Email: nvisser@nedbankcapital.co.za
Kerri Savin
Senior Manager: Nedbank Capital Communications
Tel: +27 (0)11 295 5672
Mobile: +27 (0)82 672 7571
Email: kerris@nedbank.co.za
Johannesburg
23 February 2010
Investment bank and sponsor
Nedbank Capital
Date: 23/02/2010 15:01:01 Produced by the JSE SENS Department.
