Capricorn Sanlam Collective Investments Performer Qualiﬁed...

www.capricornfundmanagers.com 1

The information contained in this document are the views of the fund manager and does not constitute financial advice as contemplated in terms of the Financial Advisory and Intermediary Services Act, and should be read in conjunction with the MDD. Use of or reliance of this information is at own risk. Independent professional financial advice should be sought before making any investment decision.

Manager's Comments

South Africa (SA) endured its first full month of lockdown in April a�ter the initial three-week period was extended for two weeks and the country then moved to a phased re-opening at month-end with extremely limited additional economic activity. But even with the economy grinding to a halt, global risk appetite returned and SA equity markets were dragged along with the rising tide. The FTSE/JSE All Share Index was up 13% for the month (its best monthly return since 2003), with the bulk of the heavy li�ting done by the resource shares. Gold miners were up over 50% in aggregate for the month and platinum shares jumped 38% MoM. Naspers put in another solid month and is now up almost 30% YTD. The only major index components to disappoint in April were the food retailers and pharmacies which had a tough month a�ter missing the initial sell-o�f in March. The Clicks Group announced results, which were fairly robust given the circumstances, but the board’s decision to omit the interim dividend and not to provide the usual full-year guidance was taken very negatively by the market. To so�ten the economic blow in SA, the South African Reserve Bank (SARB) delivered a 1% interest rate cut in April, following its 1% rate cut in March, bringing SA’s o�ficial interest rate to a record low of 4.25%. SA 10-year bonds saw their yield drop 0.7% to 10.3%, with foreign selling somewhat muted ($0.6bn for April) into SA’s much-anticipated month-end exit from the World Government Bond Index a�ter March’s credit downgrade by Moody’s. In fact, foreigners sold almost six times as many bonds in the month leading into the downgrade than they did in the month since the downgrade. Despite limited foreign selling in local equity and bond markets and strong global risk appetite, the rand still managed to breach $19/$1 several times during April before ending 3.7% MoM weaker at R18.81/$1. In this environment the fund performed well, returning 11.7% for the month. Contributors to the gains were broad-based, but our significant holdings in Naspers, the PGM sector and the PSG Group contributed materially. The PSG Group surprised the market by announcing that it is seriously

considering unbundling its 31% stake in Capitec. We believe that this is a very prudent move by PSG management and still see significant value in the share. Losses were predominantly focused in our short portfolio. We are cautious on the aggressive recovery experienced by global equity markets. Although we acknowledge that global central banks, including the SARB, have reacted aggressively and �lushed the world with liquidity, we are concerned that the market is too optimistic on how quickly the world will return to normal. Although we are confident that our current portfolio will generate attractive returns in the long term, the shorter term returns may be far more volatile. As such, we have decided that it is prudent to hedge a significant portion of our portfolio using various option structures. These structures should enable us to participate significantly if we are wrong and the market continues to rally, but will help to protect us should the market sell-o�f again in the near future. We thank you for your continued support.

Objective

Summary Statistics

The CAPRICORN SANLAM COLLECTIVE INVESTMENTS PERFORMER QUALIFIED HEDGE FUND is a Rand denominated South African long/short equity hedge fund. The Portfolio has a strong focus on long term capital appreciation, targeting an absolute return in excess of cash. The Portfolio aims to provide returns with lower volatility and lower drawdowns than equities.

Fund

(16,7%)

1 YEARRETURN

4.1%Benchmark(CPI)

R68mCURRENT NAV

N/A

(0.9%)

3 YEARANNUALISED

RETURN

4.2%

(2.7%)

3 YEARCUMULATIVE

RETURN

13.0%

ANNUALISED*RETURN SINCE

INCEPTION

11.0%

5.2%

CUMULATIVERETURN SINCE

INCEPTION

124.8%

47.8%

Date: 30/04/2020 Source: Maitland Fund Services (Pty) Ltd and Capricorn Fund Managers (Pty) Ltd*Annualised Return is calculated from the historical returns of the fund since inception and is the annual growth rate that gets you from the initial investment value to the ending investmentvalue if you assume that the investment has been compounding annually over the time period.

• Fund Performance

Capricorn Sanlam Collective InvestmentsPerformer Qualified Hedge Fund April 2020


2012

2013

2014

2015

2016

Italicized returns are net returns for the previously unregulated fund Date: 30/04/2020 Source: Maitland Fund Services (Pty) Ltd and Capricorn Fund Managers (Pty) Ltd.

Historical Monthly Returns

Oct Nov DecJan Feb Mar Apr May Jun Jul Aug Sep BenchmarkYTDYTD

2017

2018

2019

2020

2.4%

5.3%

5.8%

4.8%

6.6%

4.6%

5.2%

3.6%

1.9%

20.4%

40.6%

11.9%

38.0%

(15.5%)

19.6%

(5.5%)

4.2%

(13.6%)

1.4%

5.0%

2.2%

1.3%

0.4%

(0.8%)

2.7%

3.2%

4.3%

0.6%

(4.8%)

6.1%

(4.7%)

2.4%

1.7%

0.1%

7.8%

5.5%

4.1%

7.6%

(0.4%)

5.9%

(4.7%)

3.1%

0.8%

1.6%

(0.4%)

3.3%

(1.4%)

0.0%

(0.0%)

(0.4%)

4.7%

0.9%

0.9%

(0.5%)

1.2%

5.3%

4.1%

(5.3%)

2.0%

(1.7%)

5.1%

(3.3%)

3.1%

0.4%

(1.4%)

0.6%

3.9%

1.8%

(2.2%)

(2.2%)

0.3%

0.4%

9.5%

6.6%

(0.9%)

6.4%

0.2%

(4.4%)

(3.2%)

1.3%

0.5%

2.7%

(3.3%)

2.6%

0.1%

3.5%

11.7%

4.8%

0.5%

2.0%

1.9%

0.7%

(1.7%)

1.2%

(15.9%)

2.5%

6.2%

2.9%

(4.9%)

1.0%

1.0%

0.2%

(9.3%)

0.6%

(5.7%)

1.7%

(5.7%)

0.2%

(4.6%)

3.4%

1.4%

Graphical Representation of Historical Monthly Returns

Date: 30/04/2020 Source: Maitland Fund Services (Pty) Ltd and Capricorn Fund Managers (Pty) LtdImportant Information: Past performance is not necessarily a guide to future performance.

Annualised Return Cumulative Returns Benchmark

60%

50%

70%

80%

40%

30%

20%

10%

0%

120%

140%

160%

180%

100%

80%

60%

40%

20%

0%

Aug

12

Oct

12

Dec

12

Feb

13

Ap

r 13

Jun

13

Aug

13

Oct

13

Dec

13

Feb

14

Ap

r 14

Jun

14

Aug

14

Oct

14

Dec

14

Feb

15

Ap

r 15

Jun

15

Aug

15

Oct

15

Dec

15

Feb

16

Ap

r 16

Jun

16

Aug

16

Oct

16

Dec

16

Feb

17

Ap

r 17

Jun

17

Aug

17

Oct

17

Dec

17

Feb

18

Ap

r 18

Jun

18

Aug

18

Oct

18

Dec

18

Feb

19

Ap

r 19

Jun

19

Aug

19

Oct

19

Dec

19

Feb

20




Frequency Distribution ofMonthly Returns Since Inception Assets Under Management (R Million)

Gross exposure Net Exposure% of positive months% of negative monthsAverage positive monthly returnAverage negative monthly returnAnnualised monthly volatility (historic)Sharpe RatioMaximum monthly drawdownMaximum cumulative drawdown

R68m207%

77%70%30%

2,8%(3,4%)13,7%

0,6(15,9%)(25,4%)

Statistics

Date: 30/04/2020 Source: Maitland Fund Services (Pty) Ltd and Capricorn FundManagers (Pty) Ltd

Launch Date: (Regulated Fund) 01/09/2016Inception Date: 01/08/2012

-5%

to -4

%

-6%

to -5

%

-3%

to -2

%

-4%

to -3

%

-2%

to -1

%

-1%

to 0

%

0% to

1%

1% to

2%

2% to

3%

3% to

4%

4% to

5%

5% to

6% 6%+

-6%

+

Freq

uenc

y %

Return Bands




Contact Information

Investment ManagerCapricorn Fund Managers (Pty) Limited25 Culross RoadBryanstonSandton2191South Africa

For enquiries please contact

Management CompanySanlam Collective Investments(RF) (Pty) LimitedT: +27 21 916 6910E: [email protected]

Stephan EngelbrechtT: +27 11 591 0554E: [email protected]

Licensed by the Financial Sector Conduct AuthorityLicense number: 863

Important InformationSanlam Collective Investments (RF) (Pty) Ltd registered and approved Manager in Collective Investment Schemes in Securities. Collective investment schemes are generally medium- to long-term investments. Past performance is not necessarily a guide to future performance, and that the value of investments / units / unit trusts may go down as well as up. A schedule of fees and charges and maximum commissions is available from the Manager on request. Collective investments are traded at ruling prices and can engage in borrowing and scrip lending. The Manager does not provide any guarantee either with respect to the capital or the return of a portfolio. Performance is based on NAV to NAV calculations with income reinvestments done on the ex-div date. Performance is calculated for the portfolio and the individual investor performance may di�fer as a result of initial fees, actual investment date, date of reinvestment and dividend withholding tax. Performance fees are calculated at 20% above the benchmark performance (CPI). Lump sum

investment performances are being quoted. Sanlam Collective Investments retains full legal responsibility for this co-named portfolio. The portfolio management of the fund is outsourced to Capricorn Fund Managers, an authorised financial services provider in terms of the FAIS Act. The Manager has a right to close the portfolio to new investors in order to manage it more e�ficiently in accordance with its mandate. The information contained within this document has been prepared by Capricorn Fund Managers (Pty) Ltd and is unaudited. Returns as shown are the weighted average of all issued series. The 2015 fund of the year Award was given in February 2016 and full details and basis of the award are available from the Manager. The 2017 South African Long/Short Equity Fund award was given in February 2018 and full details and basis of the award are available from the manager.



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