Burchelson
Ashford W. Meikle, Staff Reporter
AT THE end of June this year, Sigma Unit Trust was the best performing unit trust in the local market - outperforming similar unit trust products offered by DB&G, Barita and Capital and Credit Fund Managers as well as JMMB's Select Index Fund.
Though its unit trusts are offered in Jamaican dollars, Sigma's products outperformed U.S.-dollar denominated funds offered by AIC (Canada), Sterling Asset Management Limited, Scotiabank and First Global.
Sigma Unit Trust is managed by Pan Caribbean Asset Management Limited (PCAM), a subsidiary of Pan Caribbean Financial Services Limited and has almost $6 billion under management.
Speaking to Sunday Business, vice-president and general manager of PCAM, Rezworth Burchenson, said: "Attaining number one reinforces our strategy and investment philosophy. We are indeed pleased but are aiming to maintain that position through to year-end, which is important. Most importantly, though is that our clients are happy, since while the stock market is flat, we are very positive."
THREE FUNDS
Sigma offers three funds: Sigma Optima, Sigma Solution and Real Estate. With Sigma Solution, funds are invested primarily in instruments such as Bank of Jamaica reverse repurchase agreements, local registered stocks, GoJ debentures, Treasury bills, GoJ repurchase agreements and Government bonds.
It is marketed by the company as being ideal for the "conservative investor looking for a low-risk product."
On the other hand, Sigma Optima invests mainly in the equities market buying into mostly blue chip companies. It grew by 102 per cent last year, outperforming the Jamaica Stock Exchange (JSE), which had a 66 per cent growth. According to PanCaribbean, "This Tax-Free portfolio is ideal if you are a higher risk individual looking for a long-term investment with the potential for high returns.
"Sigma Optima represents a variety of listed equities consisting primarily of blue chip Jamaican companies and is prudently managed on a daily basis to ensure maximum performance."
In the Money Market Fund, Sigma Solution led the market with a year to date growth of 7.5 per cent and an annualised (that is, year to year) return of 15.17 per cent. Sigma's nearest competitor, Capital and Credit's Giltedge Fund had a year to date growth of about seven per cent and annualised return of just over 14 per cent.
Sigma Optima had a year to date return of over 10 per cent ahead of Barita's Capital Growth Fund. Its annualised return of over 21 per cent was again ahead of Barita with 15 per cent.
COMPETITIVE ADVANTAGE
Explaining the Pan Caribbean's competitive advantage, Mr. Burchenson noted: "We are very research driven. Each decision is based on fundamental research and approved by our assets and liability committee made up of knowledgeable professionals ... For the equity, due to our active management the mix is constantly changing. We employ active management to capitalise on intraday changes."
Even with the lacklustre performance of the JSE with a year to date growth of four per cent the executive says that persons are still interested in the equities market. "There is still interest in our equity portfolio (Sigma Optima) as persons are realising the benefits of investing in equity over the medium term," he reflected.
BUYING OPPORTUNITY
For this reason, he advises: "Potential investors should view the current market environment as a buying opportunity. However, it is important that proper research is done in selecting the appropriate stocks. I encourage persons to buy companies which are growing or employing strategies to grow. Without growth in earnings there will be no capital appreciation."
However, for persons who are intimidated or hesitant about investing in individual stocks, it is best to leave it to the experts hence the concept of unit trusts in which individuals' funds are pooled together, offering diversity, thus spreading the risk involved in investing. "Beating the market is not an easy task. Most fund managers who do beat the market are quite experienced, have studied the market over the years and developed a particular investment philosophy and strategy."
