Sygnia Stargazer Update: A Positive Quarter for All Funds

We’ve got some good news to share – all three Stargazer funds posted positive returns this quarter! Here’s how your child’s investment has been doing.

Stargazer Tech (SYG4IR AM ETF) – up 7.5%
The Tech fund had a great quarter, riding the wave of excitement around artificial intelligence (AI). Both the US and China invested more than expected in AI technologies, which gave global markets a nice boost. Add to that some positive vibes around potential US interest rate cuts and you’ve got a recipe for solid returns. The rand strengthened a bit this quarter, though, which took a small bite out of the international gains.

Stargazer Eco (SYGESG) – up 5.1%
The Eco fund delivered another positive quarter, with particularly strong performances from tech, consumer and communications companies. The AI boom continues to drive a lot of this growth across global markets. Consumer staples and materials didn’t pull their weight this time around, but overall the fund still came out ahead. Like the Tech fund, the stronger rand nibbled away at some of those international returns.

Stargazer Moderate (SKELBAL40) – up 5.3%
The Moderate fund’s balanced mix did its job nicely this quarter. South African shares and resource investments were the stars of the show, while global bonds and cash didn’t contribute as much due to that stronger rand already mentioned.

Planning ahead: Using Stargazer’s glide-path strategy

Now that you’ve seen how the three funds are performing, let’s talk about how they can work together as part of your child’s journey to university.

When it comes to your child’s education savings, you should probably be more conservative than you are with your own retirement nest egg. Sound counterintuitive? Remember, your kids likely have no more than 18 years until they head off to university, while you may have decades until you retire – and you’ll likely live a few decades beyond that.

And this is why we designed Stargazer with three funds that can work together in a glide-path strategy.

Starting young: Tech and Eco for growth

When your children are young, time is on your side. This is when Stargazer Tech and Stargazer Eco can work hardest for you. These higher-risk funds aim for stronger growth by investing in technology, global markets and sustainable companies. With 10 to 18 years until university, your child’s savings have time to ride out market ups and downs.

Getting closer: The shift to Moderate

As your child approaches high school, it’s time to start thinking about moving some of their savings from Tech and Eco into Stargazer Moderate. This balanced fund includes South African and global equities, bonds and cash – a mix designed to be less volatile when they’re getting closer to needing the money.

Here’s a simple approach: Let’s assume you’ll need to cover four years of university expenses. You might aim to have a quarter of your child’s savings in Stargazer Moderate when they’re five years from their first year at university, move another quarter when they’re five years from their second year, and so on.

Why the caution?

Higher-risk investments can lose money over some five-year stretches. While you might spend your retirement savings over 20 or 30 years, giving markets time to recover from downturns, university fees come due over just four years. That’s a much heavier deadline.

Making the move

The beauty of Stargazer is that you can adjust the risk level as your child grows. When they’re little, lean toward Tech and Eco for growth potential. As they get older, gradually shift to Moderate to protect what you’ve built for them. It’s a glide path that matches their timeline and gives you peace of mind.

We’re keeping our eyes on the long game for your children’s investments. Ups and downs are part of the journey, but three positive quarters in a row show that diversification is doing what it’s supposed to do.

Keep shining!
The Sygnia Stargazer team

This newsletter is for informational purposes only. Past performance does not guarantee future results. Please consider the risks associated with investing before making investment decisions.