(Getty)
  • Property funds have been the worst performing unit trusts over the past one, three and five years.
  • Some investors in property unit trusts have seen the value of their investments halve in the past year. 
  • Data compiled by the investment research firm Morningstar shows that the top-performing fund over the past year was the Old Mutual Gold Fund (+46%).
  • For more stories, go to Business Insider SA's home page.

Concerns about the coronavirus has wreaked havoc on markets – over the past two weeks alone, the JSE has lost almost a quarter of its value. It’s down 30% from the start of the year. 

For investors in unit trusts, there was virtually nowhere to hide: the sell-off was indiscriminate.

But looking at a list of the worst-performing retail unit trusts on offer in South Africa over the past one, three and five years, compiled by the investment research firm Morningstar, there was one sector that was the stand-out loser. 

After years of outperformance, property funds are bleeding. The income of South African property companies are under pressure due to the weak local economy and an oversupply of office and mall space market (Almost 20% of the office space in the Durban CBD, Rosebank and Hatfield in Tshwane stood empty in the last quarter of 2019.) 

Property funds have also been dragged down by the weak performance of a number of UK property companies that are listed on the JSE, which have have had a torrid time amid a Brexit-driven meltdown. 

These were the unit trusts that lost the most of their value:

Worst-performing unit trusts over the past year (19 March 2019 to 18 March 2020)

  • Prescient Property Equity A1 -50.4%
  • Sygnia Listed Property Index A -50.4%
  • Momentum Real Growth Property A -50.5%
  • Momentum SA Real Growth Property A -50.6%
  • Catalyst SA Property Equity Prescient A -51.0%
  • SIM Property A -51.0%
  • Investec Property Equity A -51.1%
  • MSM Property ACI A1 -51.8%
  • Prudential Enh SA Prop Tracker A -51.8%
  • Mazi Asset Management Prime Property A1 -52.1%
  • Ci Property B -52.7%

Worst-performing unit trusts over the past three years (19 March 2017 to 18 March 2020)

  • ABSA Smart Alpha Property A   -24.6%
  • STANLIB Property Income B1 -24.6%
  • Investec Property Equity A -24.6%
  • Sygnia Listed Property Index A -24.9%
  • Prescient Property Equity A1 -25.0%
  • Satrix Property Index A1 -25.0%
  • SIM Property A -25.6%
  • Mazi Asset Management Prime Property A1 -25.6%
  • Prudential Enh SA Prop Tracker A -26.1%
  • Nedgroup Inv Property A -26.9%
  • Ci Property B -27.6%

Worst-performing unit trusts over the past five years (19 March 2015 to 18 March 2020) [% return per year]

  • Momentum Real Growth Property A-13.7%
  • Investec Property Equity A-13.7%
  • Prescient Property Equity A1-13.8%
  • Sygnia Listed Property Index A--13.9%
  • Satrix Property Index A1-14.0%
  • Optimum BCI Property A-14.1%
  • Prudential Enh SA Prop Tracker A-14.4%SIM Property A-14.5%
  • Nedgroup Inv Property A-14.5%
  • Mazi Asset Management Prime Property A1-15.6%
  • Ci Property B -15.7%

Source: Morningstar

Should you sell out of a unit trust that has suffered big losses?

“It’s probably too late,” says  Schalk Louw,  portfolio manager and strategist at PSG Wealth Old Oak. You will lock in these massive losses, and miss out on the inevitable recovery – although you may have to remain invested for a much longer time.

Still, if you are concerned about an underperforming unit trust, it is important to take a look at what the fund manager has been investing in, and whether this is in line with what you would expect, and their processes. You will find the underlying shares in a unit trust on its trust fact sheet, which fund managers has to publish on their websites.

You can also compare how your unit trust fared against others in its category.

Unit trust winners

Various international unit trusts, as well as a couple of gold funds, dominate the lists of the best-performing unit trusts, as compiled by  Morningstar

Top-performing unit trusts over the past year (19 March 2019 to 18 March 2020)

  • Old Mutual Gold R 45.8%
  • BCI ACPI Global Balanced Feeder A 27.5%
  • Rezco Global Flexible A 23.1%
  • 1nvest Global Govt Bond Index A 21.8%
  • IP Global Momentum Equity A 21.4%
  • AF Investments USD 20.8%
  • Stonewood BCI Global Equity A 20.4%
  • Prescient Global Income Provider A1 19.7%
  • 1nvest S&P500 Info Tech Index Fund A 19.6%
  • STANLIB USD Currency Fund of Funds A 19.6%

Top-performing unit trusts over the past three years (19 March 2017 to 18 March 2020) [% return per year]

  • IP Global Momentum Equity A 21.4%
  • Old Mutual Gold R 17.2%
  • MI-PLAN IP Global Macro B5 15.9%
  • BlueAlpha BCI Global Equity A 15.8%
  • Northstar SCI Global Flexible A 15.5%
  • Investec Global Franchise FF A 14.7%
  • STANLIB Global Equity FF A 14.0%
  • Select BCI Worldwide Flexible A 13.8%
  • STANLIB Global Balanced FF B1 13.2%
  • PSG Wealth Global Creator FF D 12.8%

Top-performing unit trusts over the past five years (19 March 2015 to 18 March 2020) [% return per year]

  • MI-PLAN IP Global Macro B5 12.8%
  • Investec Global Franchise FF A 12.6%
  • Old Mutual Gold R 11.6%
  • BlueAlpha BCI Global Equity A 11.5%
  • PSG Wealth Global Creator FF D 10.6%
  • STANLIB Global Equity FF A 10.3%
  • Select BCI Worldwide Flexible A 10.2%
  • Fairtree Flex Income Plus Prescient A1 10.1%
  • Pan African IP Income Hunter 9.8%
  • Nedgroup Inv Global Equity FF A 9.7%

Source: Morningstar

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