Portfolio Objectives
Each Bips portfolio aims to replicate or track, before expenses, the performance of an applicable Index (the Index) in terms of both the price performance and the income from the component securities of the Index. This allows investors the opportunity to obtain market exposure to the performance of the Index in an easily tradable form through the shares being listed on the JSE Limited.
The investment policy of each portfolio is to replicate the price movement and income yield of the index that it is designed to track. This is achieved by purchasing the constituent securities in the same weighting as they are included in the relevant index. The asset manager is not mandated, nor incentivised, to outperform the index.
Distributions
The underlying shares in which Bips invest generally pay dividends annually. These dividends are retained in the respective fund in cash and accrue interest. This cash is used to defray expenses incurred in managing the fund. However, the dividends that accrue generally exceed these expenses and the balance is distributed to investors quarterly each year.
Calculation of the Net Asset Value
Collective Investment prices are calculated on an historic net asset value basis, which is the total value of all assets in the portfolio including any income accruals and less any permissible deductions (brokerage, STT, VAT, auditor's fees, bank charges, trustee/custodian charges and annual management fees) from the portfolio, divided by the number of participatory interests in issue. The Net Asset Value and the NAV per share will be calculated on each valuation day. The Net Asset Value and the NAV per share will be determined on the basis of the last closing prices on the business day immediately preceding the valuation day or the last available prices from the markets on which the investments of the applicable Bips portfolio are traded. The price at which ETF’s trade on the Exchange may differ from the Net Asset Value price published at the close of the trading day, because of intra-day price movements in the value of the constituent basket of securities.
Fees
ETFs are attractive to investors as they provide a cost effective mechanism to gain broader equity Exposure that would otherwise be cost prohibitive. There are nominal management fees associated with each of the Bips ETFs which are outlined in the table below.MANAGEMENT Fees for Bips Inflation-X
| Investment | Incremental fee (%) |
| First R30,000,000 | 0.36 |
| Each subsequent Rand over R30,000,000 | 0.15 |
| MANAGEMENT Fees for Bips Top40 |
| All investments | 0.10% |
Additional expenses contribute to the total costs within a fund, comprising the Total Expense Ratio (TER). This may only be calculated retrospectively using actual cost incurred within the fund. Each fund's fact sheet will be updated with the applicable TER.
Charges included in the TER:
Quantifiable charges:
Initial Fee: 0%
Managers Annual Management Fee: up to 0.1%
Exchange Trading Fees:- Brokerage
- Securities Transfer Tax (STT)
- Trading Fees (STRATE)
- Administration fees
Non-quantifiable charges:
Auditor’s fees, bank charges, trustee and custodian fees.
Details of Service Providers:
Local Trustee
Absa Capital Investor Services
Entrance 6E1, 6th Floor, Absa Towers North, 180 Commissioner Street, Johannesburg, 2001
PO Box 61218, Marshalltown, 2107
Custodian
Absa Capital Investor Services
Entrance 6E1, 6th Floor, Absa Towers North, 180 Commissioner Street, Johannesburg, 2001
PO Box 61218, Marshalltown, 2107
Manager
Bips Investment Managers (Pty) Limited (Registration number 2006/036970/07)
1 Merchant Place, Cnr Fredman Drive & Rivonia Road, Sandton
P.O Box 786273, Sandton, 2146
| BIPS TOP 40 | |
| Market Price | R30.66 |
| Underlying Index Price | 30619.38 |
| NAV* | R30.722635 |
| INFLATION X | |
| Market Price | R16.49 |
| Underlying Index Price* | 164.723 |
| NAV* | R16.4883 |
| Weighted average yield | 1.8132 |
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| *as on close of business 03/01/2012 | |