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  Fixed Income Range  
       
  This range offers investors a number of options to gain exposure to the South African fixed-income markets. The portfolios range from shorter-dated cash portfolios to longer-dated bond portfolios.  
 
     
Pure Fixed Interest  
Inflation-Linked Bond
The investment managers selected for this portfolio invest mainly in inflation-linked bonds issued by the South African government. These differ from conventional bonds in that the capital amount increases with inflation and the coupon rate is applied to this increased capital amount. This causes the coupon interest payments to move in line with the inflation index over time. The investor therefore receives income in real terms and an inflation-adjusted capital amount on redemption of the bond.

Secure Income Provider
This portfolio offers investors direct access to bond instruments within their Investment Solutions Living Annuity. This ensures that investors receive a known series of interest payments and, hence, a known return. In the case of inflation-linked bonds, a return linked to inflation (headline CPI). This enables them to lock in a fixed return for a portion of their investment, while the remainder of their assets can be used to enhance overall returns. This only applies if the bond is held to maturity.

 
 
 
 
 
 
 
 
 
 
The specialist investment managers selected for this portfolio invest in fixed-interest instruments comprising mainly bonds, which generally have maturity dates longer than one year, and money-market instruments. Bonds are issued by governments or corporate entities and may provide an investor with higher investment returns than cash. The managers, which may have different bond investment styles, are given specific mandates aimed at steady growth in capital value and income. Relative to other single-manager bond-only portfolios, this portfolio is expected to have lower volatility of returns over the medium term due to the nature of its construction.  

 
Income  
The specialist investment managers selected for this portfolio invest in income-yielding fixed-interest instruments such as money-market instruments, bonds and inflation-linked bonds. Money-market instruments generally have maturity dates shorter than one year and bonds longer than one year. The assets in the portfolio will consist mainly of shorter-dated bonds between one and three years. The managers are given specific mandates aimed at providing income and some capital growth. Relative to single-manager income-only portfolios this portfolio is expected to have lower volatility of returns over the short to medium term due to the nature of its construction.  

 
Banker  
The specialist investment managers selected for this portfolio may invest in money-market instruments and cash. Money-market instruments are liquid financial instruments that basically simulate cash, but often give a higher return. The managers are given specific mandates aimed at providing an investment return above the average of money-market portfolios, while maintaining a high degree of liquidity and capital preservation. They may only be exposed to institutions with an A1 (F1) credit rating or better.  

 
 
     
   

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