The Futuregrowth Infrastructure & Development Bond Composite, a specialist yield enhanced bond portfolio, forms part of Futuregrowth’s suite of developmental investments.
The Composite targets high returns through a combination of moderate credit concentration limits, active interest rate risk management and active off-benchmark bets. The benchmark is the All Bond Index.
The Composite aims to outperform the ALBI by 1% per annum before the deduction of taxes and fees and with income reinvested over a rolling 3-year period.
The Composite may invest in a wide range of debt instruments including those issued by government, parastatals, corporates as well as securitised assets. The inclusion of assets is subject to credit committee approval.
The Composite is allowed to invest up to 50% in unlisted credit and in addition, to invest in up to 5% equity assets (primarily through the Development Equity Fund) subject to investment committee approval. The resulting effect is in good risk-adjusted alpha generation over time.
In order to retain adequate liquidity and flexibility, and in the course of managing new investments, asset maturities and sales and fund-flows, the Composite usually maintains a high degree of liquid and/or non-developmental assets.
The Composite aims to provide investors with a vehicle that facilitates infrastructural, social, environmental and economic development in southern Africa and delivers on a variety of social impact requirements such as job creation, affordable housing, access to services and healthcare.
- A social impact with financial benefits: Futuregrowth invests R625m in the Gauteng housing market / view
- SA Taxi secures R300m from Futuregrowth / view
- Using pension and provident funds to fund Infrastructure / view
- Sustainability of infrastructure projects for retirement funds / view
- Futuregrowth provides R300m to stimulate growth in the taxi industry / view