Apr 2013 Financial News

Got J$500m? Sagicor's got a unit-trust product for you!

Apr 08, 2013

The Sigma real estate fund, one of 10 unit-trust products marketed by Sagicor, is to be made available to retail investors but in a new format by the middle of this year.

Currently, the size of the fund stands at J$12 billion or more than half of Sagicor's J$22.6 billion total funds under management, according to Rohan Miller, vice-president and chief investment officer of Sagicor Life Jamaica Limited.

But to invest in the Sagicor Sigma real estate fund, an investor must have a minimum of $500 million for at least three years, which orients the fund towards institutional investors.

The fund invests in resort properties, industrial parks, office buildings and retail real estate investment instruments.

But come mid-year, said Miller, the fund will be tweaked to enhance its market appeal for retail clients.

"It will not be a direct investment but we will be making it a more attractive one for retail investors to participate in and invest in real estate in a more liquid investment structure," he told Sunday Business.

TrUST PORTFOLIOS

The Sagicor Sigma Fund offers nine other unit trust portfolios which allow investors to invest a minimum J$500. That too is a new adjustment from the previous floor of J$45,000.

The investment has to remain for a period of 90 days to avoid a penalty. If the portion invested at any point in time is encashed before the minimum three-month holding period, a penalty of four per cent of the value will be applied.

The same penalty also applies to the real estate fund which has to be held for a period of three years.

Unit trusts are seen to be one of the more attractive investments in the market in an environment of lowering interest rates. The market is currently valued at about J$50 billion in funds under management by its four players: Sagicor, Barita, Scotia Asset Management and JMMB Fund Managers.

For the quarter ended September 30, 2012 — when regulator Financial Services Commission (FSC) estimated the market at J$41.2b — approximately 80.68 per cent of the funds were invested in fixed-income securities, approximately 10.98 per cent in equities, 6.23 per cent in real estate, and approximately 2.10 per cent in cash and other instruments.

Since this year, Sagicor Sigma Fund says it became the leader in the unit-trust market capturing a 47 per cent share, overtaking Scotia Asset Management.

POOLED FUNDS

Prior to that up to September 30, 2012, the FSC data placed Scotia in pole position with 51.9 per cent market share, at which time Sagicor Sigma Fund had 34.3 per cent, JMMB Fund Managers 7.6 per cent and Barita Unit Trust Management 6.2 per cent.

Management of the Sagicor Sigma Fund were recently transferred from Sagicor Investments Jamaica Limited to Sagicor Life, the parent company, in a restructuring by the group to place all its pooled funds managed by entities in the group under one umbrella.

Sagicor Life's pooled funds, inclusive of the unit-trust portfolio, amount to approximately J$100 billion.


Source:
Sabrina Gordon, Business Reporter
Sabrina.gordon@gleanerjm.com
Sunday April 7, 2013

http://jamaica-gleaner.com/gleaner/20130407/business/business2.html