A unit trust is an investment vehicle which gives you affordable access to the financial markets without having to buy the assets yourself. When you invest in a unit trust the money is pooled with that of other investors. This pool of money is used to invest in a portfolio of assets such as equities, bonds, cash and property, depending on the objective of the unit trust. The unit trust is divided into units of equal value, which will be allocated to you according to the amount of money you invest and the price of the units on that day.

• A unit trust enables you to access and benefit from investments at a much lower cost than if you buy them directly on the security market.
• From R500 a month you enjoy access to professional investment managers and index tracking funds, offering you local and international investments.
• Unit trusts have no lock-in period, meaning that you decide when and how many units to buy, which you will own until you decide to sell them.
• Unit trusts are also well protected in South Africa and regulated by government legislation and industry standards.

Each fund has an investment minimum which is disclosed on the minimum disclosure document (also known as fund fact sheet). You can invest a once-off amount (lump-sum), regular monthly amounts or if you are an existing investor, you can make additional investments when it suits you.

The cost associated with each fund is available in the Minimum Disclosure Document (fund fact sheet) so that you can make an informed choice.

• Advisory Fees
  • No advisory fees are payable on unit trusts purchased on this website. You may negotiate on-going advisory fees with a financial planner in future if you require advisory services.
• Management Fees
  • Fees payable to the fund manager for the investment management. This is shown in the Minimum Disclosure Document of each fund.
• Total Expense Ratio (TER)
  • The total expense ratio is a measure of the total costs, fees and expenses that were incurred and levied in the fund over a 12-month period.
  • The TER will include all costs and expenses necessary for the normal operation of the unit trust fund including management fees, but will exclude advisory fees.
  • Each fund will have a different TER which can be seen on the Minimum Disclosure Document.

The Effective Annual Cost (EAC) is a measurement that aims to standardise cost disclosures across different investment products. It is expressed as an annualised percentage and is made up of four components (investment management charges, advice charges, administration charges and other charges), which are added together. The EAC shows the extent to which the investment return will be reduced by charges over a specified period. The lower the EAC, the more cost-effective an investment is.

A number of Sanlam Unit Trust funds are available. They are categorised based on risk profile to suit investors different investment objectives and timeframes, as well as different levels of tolerance for investment risk. The investment mandate of a specific fund is linked to its risk profile and will determine which assets the fund can invest in.

Available funds can have one of the following investment risk profiles:

CONSERVATIVE: Conservative investments provide modest returns with a high degree of capital security. A typical portfolio will consist primarily of income orientated asset classes such as cash, bonds and property, with very little exposure to equities. The expected return may be close to inflation. There is therefore a risk that the real value of an investment may reduce over time, after taking fees and taxes into consideration.

CAUTIOUS: Cautious investments provide stable returns with limited risk of capital loss. A typical portfolio will consist primarily of income orientated asset classes such as cash, bonds and property, with limited exposure to equities.

MODERATE: Moderate investments should generate real returns by outperforming inflation over the longer term, but will at times experience short-term negative returns. A typical portfolio is diversified over all major asset classes to provide a balance between risk and return. There is a moderate risk of capital losses in the short-term.

MODERATELY AGGRESSIVE: Moderately aggressive investments can have a fair amount of fluctuations in the short-term returns, in anticipation of higher real returns over the long-term. A typical portfolio is diversified over all major asset classes, with a bias towards equities to create real capital growth over the long term. There is a substantial risk of capital losses in the short-term.

AGGRESSIVE: Aggressive investments aims to maximise real return over the long-term, but may experience severe short-term negative returns. A typical portfolio is diversified over all major asset classes, with a strong bias towards equities in order to significantly outperform inflation over the long-term. There is a significant risk of capital losses in the short-term.

Once you have opened your unit trust fund, register on Sanlam’s Secure Service site to access and manage your portfolio online. Simply go click on Secure Service and follow the easy steps to complete your registration. You will have access to your portfolio information 24/7 at your convenience.

Alternatively, you can contact the Sanlam Collective Investment Client Contact Centre at 0860 100 266 or service@sanlaminvestments.com.

Should you have any enquiries or require additional assistance, please contact the Sanlam Collective Investments Client Contact Centre on 0860 100 266 or service@sanlaminvestments.com.

The income and capital gains from your unit trust investments are taxable and you need to report it on your income tax return. Sanlam Collective Investments send investors tax certificates annually at the end of May. If a capital gain or loss is incurred, this is reflected on the IT3(c) tax certificate and the investor may be liable for Capital Gains Tax (CGT).

Interest income and dividends are reflected on the IT3(b) tax certificate. Tax on dividends is withheld, while interest income for RSA taxpayers is paid excluding tax. Dividends Tax are withheld at 20% in line with tax legislation. If you qualify for a reduction in the Dividends Tax rate or an exemption, your withholding tax rate will be adjusted upon receipt of the relevant Dividends Tax Form. You can request the form from the Sanlam Collective Investments Client Contact Centre on 0860 100 266 or service@sanlaminvestments.com.

Certain non-SA investors may qualify for an exemption from or a reduced rate for withholding tax on interest or may qualify for a reduced rate in dividends tax. In order to qualify for this, please complete the Withholding Tax on Interest Declaration Form (WTI) and/or the Dividends Tax Form (DTD) (RR). You can request the form from the Sanlam Collective Investments Client Contact Centre on 0860 100 266 or service@sanlaminvestments.com.

Remember to consult your financial planner on how to structure your investments optimally.