Are you an Absa Online customer?

  • Logon on to your Absa Online profile;
  • Click on apply; and
  • Click on Exchange Traded Products.

Not an Absa Online customer?

 

Current Absa clients?

  • Logon on to your Absa Online profile
  • Click on the 'apply' button on the top row
    of the screen
  • Click on Exchange Traded Products
  • Click on Retirement Annuity

New Absa clients?

 

Current Absa clients?

  • Logon on to your Absa Online profile
  • Click on the 'apply' button on the top row
    of the screen
  • Click on Exchange Traded Products
  • Click on Voluntary Investment

New Absa clients?

 

Your current browser does not support functionalities on this page

To be able to view this page, please upgrade your current browser or select one from the list below:

Frequently asked questions  

    ETFs


  • What is an Exchange Traded Fund (ETF)?
    • Exchange Traded Funds (ETFs) are passively managed index funds that are listed and traded on a securities exchange. An ETF tracks the performance of and/or gains a broad exposure to a particular index, sector or a commodity for individual and institutional investors.
  • Why are ETFs being advised as the most appropriate medium to long term investments in today’s markets?
    • The first ETFs were launched in the early 1990s, but were little-known until about the year 2000. It was then that investors began realising that ETFs were consistently delivering better returns at lower commissions than unit trusts. ETFs can be described as investment products that have evolved past unit trusts in offering improved medium to long-term investment returns with relatively little risk.
  • Why should I acquire ETFs rather than the more traditional unit trusts?
    • ETFs generally outperform traditional unit trusts, while their commission charges at 1% or less are considerably cheaper than unit trusts, which charge up to 3%. Other key advantages are that ETFs are as easily bought or sold as any security; can be traded throughout normal JSE trading hours; and their actual value can be calculated at any time.

    Commodity Index ETNs


  • How do I buy or sell NewWave Commodity Index ETNs?
    • NewWave commodity index ETNs are listed in the ETN sub-sector of the JSE Limited and may be bought (please see secondary market below) or sold during normal trading hours (9am to 5pm SA time).

      Primary Offering

      In the primary offering, NewWave commodity index ETNs may be subscribed for through any JSE stockbroker or your CSDP.

      Secondary Market

      Absa Capital will act as the primary market maker, ensuring there is intra-day liquidity (in minimum size of 10 000 notes) in commodity index ETNs.

      Contacts

      Please contact your stockbroker or CSDP to subscribe. If you do not currently have a stockbroker contact Absa Stockbrokers
      Tel no: +27(0) 860 050 403
      Website: www.absastockbrokers.co.za
      You can also contact the market maker directly on +27(0) 11 895 5512

  • Who is the Issuer of ETNs?
    • Absa Bank Limited is the Issuer of the ETNs. Absa Bank is an authorised financial services provider and registered credit provider.
  • Who is Absa Capital?
    • Absa Capital acts as the originator and issuer agent of the ETNs. Absa Capital is the investment banking division of Absa Bank Limited and is affiliated with Barclays Capital
  • Are the NewWave commodity index ETNs rated?
    • No, the ETNs are not rated, but rely on the ratings of the Issuer, Absa Bank Limited.
  • Do NewWave commodity index ETNs offer principal protection?
    • No. Investors will receive the performance of a precious metal, less investor fees payable and any applicable spread. The reference reference price may go up or down. Even if the price goes up, investors may not recover their principal once fees payable are deducted.
  • Do NewWave commodity index ETNs available make interest payments?
    • No, investors will receive the performance of the reference index to which the ETN is linked, less investor fees payable. The reference index may go up or down. Even if the index goes up, investors may not recover their principal.
  • Do NewWave commodity index ETNs make dividend distributions?
    • No
  • What is currently the investor fee for commodity index ETNs?
    • The investor fee is a percentage per annum of 0.65% calculated cumulatively on a daily basis.
  • What is the price I can expect to pay for commodity index ETN?
    • The rand equivalent of a 100th of the index level of the reference index, less any investor fees and applicable spread. For example, if the initial index level is 2850 and assume a USD/ZAR exchange rate of 1:10, and a spread of 1%, the issue price per note is R287.85.

      *This example is for information purposes only, and investors must familiarise themselves with the content of the programme documentation which is available for download.

  • What is the term of the NewWave commodity index ETNs?
    • These notes will have a fixed term of 10 years. Investors wishing to sell their notes prior to maturity can do so in the secondary market or to the issuer in minimum blocks of 10 000 notes.
  • What can I expect to receive when holding notes until maturity?
    • You will receive a cash payment at maturity which will be a function of the performance of the reference index, less the accumulated investor fee.
  • Can I sell my NewWave commodity index ETNs prior to the maturity date?
    • Yes, you can sell your notes in the secondary market to the market maker.
      Absa Capital will act as the primary market maker, ensuring that there will be intra-day liquidity for the notes (in minimum size of 10 000  notes), enabling note-holders to sell their notes in the secondary market.
  • How do I calculate the Redemption Value per note when redeeming my notes?

    • The Redemption Value on any relevant calendar day shall be determined as follows:
      RVt = (RVt–1 x Index Factort) – Daily Feet

      Where:
      “RVt-1” means the Redemption Value on the immediately preceding calendar day, provided that the Redemption Value on the Inception Date shall be deemed to equal the Initial Issue Price;
      “Index Factort” means the Daily Index Factor for the relevant calendar day. Daily index factor is calculated by using the following formula Tt / Tt - 1 Where:
      Tt means the Index Level on such day; and
      Tt–1 means the Index Level on the Trading Day immediately preceding the relevant Trading Day;
      “Daily Feet” means the Daily Fee for the relevant calendar day using the following formula: 
      Daily Fee (t) = RV (t-1) X Index Factor X [Specified InvestorFee Percentage / 365]
      Where:
      Index Factort means the Daily Index Factor for the relevant calendar day; and
      RVt-1 means the Redemption Value on the immediately preceding calendar day; provided that the Redemption Value on the Inception Date shall be deemed to be equal to the Initial Issue Price.
       
  • What are the exchange control implications for an investor?
    • The NewWave ETNs are classified as an inward listing on the JSE Limited for exchange control purposes.
       
      For institutional investors foreign allowance limits apply.
  • Who do I contact to learn more about NewWave Commodity Index ETNs?
    • You can contact Absa Capital ETFs and Index products team on
      +27 (0)11 895 5517 or visit our website www.absacapitaletfs.com
  • How are the returns of Commodity Index ETNs calculated?
    • NewWave Commodity Index ETNs are designed to provide investors a return that is linked to the performance of an index (reference index), less invstor fees and applicable spread.

    Precious Metal ETNs


  • How are the returns of NewWave Precious Metal ETNs calculated?
    • NewWave Precious Metal ETNs are designed to provide investors a return that is linked, either to the performance of a spot price of a precious metal like platinum or silver, less investor fees and any applicable spread.
  • How do I buy or sell NewWave precious metal ETNs?
    • NewWave precious metal ETNs are listed in the ETN sub-sector of the JSE Limited and may be bought (please see secondary market below) or sold during normal trading hours (9am to 5pm SA time).
       
      Primary Offering
      In the primary offering, NewWave precious metal ETNs may be subscribed for through any JSE broker or the ETN investment plan.
       
      Secondary Market
      Absa Stockbrokers (Pty) Limitesd will act as market maker ensuring there will always be intraday liquidity in the precious metal ETNs.
       
      In the secondary market, NewWave precious metal ETNs may be bought or sold through any JSE broker or the ETN investment plan.
       
      Contacts
      Please contact your stockbroker to subscribe. If you do not currently have a stockbroker, contact Absa Stockbrokers:
      Tel no: 0860 050 403
      Website: www.absastockbrokers.co.za
       
      Alternatively, to invest via the investment plan specially structured for the individual investor to have easy access to ETNs via a monthly debit order or lump sum investment, contact:
      Tel no: 0861 289 383
      Website: www.absacapitaletfs.com
  • Who is the Issuer of ETNs?
    • Absa Bank Limited is the Issuer of the ETNs. Absa Bank is an authorised financial services provider and registered credit provider.
  • Who is Absa Capital?
    • Absa Capital acts as the originator and issuer agent of the ETNs. Absa Capital is the investment banking division of Absa Bank Limited and is affiliated with Barclays Capital.
  • Are the NewWave precious metal ETNs rated?
    • No, the ETNs are not rated, but rely on the ratings of the Issuer, Absa Bank Limited.
  • Do NewWave precious metal ETNs offer principal protection?
    • No. Investors will receive the performance of a precious metal, less investor fees payable and any applicable spread. The reference reference price may go up or down. Even if the price goes up, investors may not recover their principal once fees payable are deducted
  • Do NewWave precious metal ETNs available make interest payments?
    • No
  • Do NewWave precious metal ETNs make dividend distributions?
    • No
  • What is currently the investor fee for precious metal ETNs?
    • The investor fee is a percentage per annum of 0.50% calculated cumulatively on a daily basis.
  • What is the price I can expect to pay for a precious metal ETN?
    • The rand equivalent of the spot price of the reference quantity of teh precious metal, less any investor fees and applicable spread. For example, if the spot price of the precious metalis $1000 and assume a USD/ZAR exchange rate of 1:10, with an initial reference quantity of 1/100th of an ounce of precious metal, the issue price per note is R100. The investor fee charge will reduce the reference quantity on a daily basis*.
       
      *This example is for information purposes only, and investors must familiarise themselves with the content of the programme documentation which is available for download.
  • What is the term of the NewWave precious metal ETNs?
    • These notes will have a fixed term of 30 years. Investors wishing to sell their notes prior to maturity can do so in the secondary market through the issuer in minimum blocks of 400 000 notes.
  • What can I expect to receive when holding notes until maturity?
    • If you hold your notes to maturity and you satisfy the physical delivery requirements, you will receive delivery of the reference quantity of bullion on maturity date, less any applicable cost or amount required to settle VAT.
       
      If you have not satisfied the physical delivery requirements Absa Bank will sell the reference quantity on your behalf and pay to you a cash amount comprising such sale proceeds less all costs of arranging and completing such disposal and less any taxes and duties for which you may be liable, including VAT. Unless you satisfy the physical delivery requirements prior to maturity, you will not have any right to the precious metals to which the ntes are referenced.
  • Can I sell my NewWave precious metal ETNs prior to the maturity date?
    • Yes, you can sell your notes in the secondary market, either to the market maker or any other party.
      Absa Stockbrokers (Pty) Limited, a subsidiary company of Absa Group Limited will act as a market maker, ensuring that there will be intra-day liquidity for the notes, enabling note-holders to sell their notes on the secondary market.
  • What are the exchange control implications for an investor?
    • The NewWave ETNs are classified as an inward listing on the JSE Limited for exchange control purposes.
       
      Retail investors can invest in notes without restriction and their foreign allowance limits will not be affected.
       
      For institutional investors foreign allowance limits apply.
  • Who do I contact to learn more about NewWave precious metal ETNs?
    • You can contact Absa Capital ETFs and Index products team on
      +27 (0)11 895 5517 or visit our website www.absacapitaletfs.com

    MAPPS


  • What differentiates NewFunds MAPPS™ from other passive products?
      • A diversified mix of asset classes which combines the performance of the underlying index in each asset class (multi-asset class);
      • Retirement industry research of the optimal asset mix for members with different investment time horizons (thereby facilitating a low cost “life-stage” modelling  approach);
      • Cost-effective fees
      • Daily transparency and liquidity, which is associated with a listed instrument (an ETF).
  • Who effectively owns the underlying asset?
    • ETFs are portfolios within a registered Collective Investment Scheme (CIS). Their assets are held in a custody with  registered independent trustees (e.g. a registered bank in South Africa) ,eliminating any credit risks associated with the issuer / originator. If the originator of the ETFdefaults, the investors still have access to the ring-fenced pool of assets underlying the ETF.
  • From a Regulation 28 perspective, can a fund choose to buy only the NewFunds MAPPS ETFs and no other investment?
    • Yes, the regulators look through to the underlying components of the ETF, which are all individually, and collectively Regulation 28 compliant.
  • Is NewFunds MAPPS restricted to a fixed asset allocation, or is there an element of dynamic tactical asset allocation?
    • The asset allocation for NewFunds MAPPS are fixed but are rebalanced quarterly back to the strategic weightings.
  • Are the index factor weightings fixed?
    • Index factor weights will be re-set quarterly so as to re-weight index components to their initial proportions in the composite index.
  • Does the NewFunds MAPPS ETF have any offshore exposure?
    • The NewFunds MAPPS ETF has local-only exposure. However, a fund wanting to access offshore exposure immediately can achieve this in two ways:
      1. Invest in an offshore ETF (currently an international multi-asset class ETF is not yet available on the JSE) to obtain international exposure; or
      2. Invest in a note issued by a bank known as an Exchange Traded Note.
  • Do I receive dividends/ coupons?
    • The MAPPS ETFs track Total Return versions of the SWIX, GOVI and ILBI Indices, which means that the dividends, coupons  and maturities derived from the Constituent Securities are notionally re-invested in the indices, as and when they are distributed. For this reason, the MAPPS Portfolios will also reinvest dividends, coupons and maturities received from the underlying securities by purchasing additional Constituent Securities in the manner and weighting dictated by the indices. Re-investment shall not be evidenced by the issue of new participatory interests, but will increase the net asset value of the portfolio and consequently shall increase the value of each participatory interest issued in the portfolio proportionately.
  • What fees are associated with MAPPS?
    • Sliding scale structure based on the amount invested

      Between R 1 – R 5m: 0.80% (80 basis points)
      Between R 5m – R 25m: 0.60% (60 basis points)
      Between R 25m – R 50m: 0.50% (50 basis points)
      Between R 50m – R 100m: 0.40% (40 basis points)
      Between R 100m – R 500m: 0.30% (30 basis points)
      R500 m +: 0.20% (15 basis points)

      Brokerage and statutory fees: Standard brokerage and statutory fees

Copyright 2013 Corporate and Investment Banking, Absa. All Rights Reserved. Corporate and Investment Banking is a division of Absa Bank Limited, Reg No. 1986/004794/06. Authorised Financial Services Provider. Registered Credit Provider Reg No NCRCP7.