S.African unit trust sector sees growth in players


Over the past 50 years the number of unit trusts has grown from 65 when the sector was first established to over one thousand.

The surge in unit trust options requires clients to make a concerted effort in understanding offering and value when making choices for investments.

(READ MORE: Listed property accessible easiest through unit trusts)


According to Johan Gouws, head of Absa’s multi management, the unit trust sector had a great run in 2014.

“The industry had a great run last year as we saw a phenomenal growth of unit trusts industry,” Gouws told CNBC Africa.

“If we look from a returns perspective, 2014 was a very interesting year,” he added.

The real sector was the best performing sector even if one looks at the global trends especially for South African investor being supported by the depreciating rand and followed by global equity market.

Gouws added that at the start of the year, it was the property sector that was suffering but later in the year the sector came out strong through to the rest of the year.

This strong performance was supported by a more positive outlook on inflation and interest rates.  

Gouws said the sector always saw new players every quarter period and urged tightening in the industry against the sprouting of players.

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“I don’t think we will see a reduction of the number of funds. I have always been amazed by the number of trusts that come into the sector every quarter,” he said.

“I would like to see the tightening of the industry.”

On future industry prospects, Gouws said passive investments will come more and more both from cost and regulatory perspective.