Cass Saddle in impressive EFT returned 223% for 2023

By Allan Mbotshwa

Cass Saddle Agriculture Exchange Traded Fund’s ETF returned 223% for the review period despite trading at a 12% discount to Net Asset Value (NAV) on the last day of trading, the fund received dividends from a single counter (BAT.zw) compared to 3 counters in the prior year. It was therefore prudent to reinvest the dividends.

The Cass Saddle Agriculture Exchange Traded Fund (CSAG) debuted on the Zimbabwe Stock Exchange on 15th July 2022.

Agriculture remains the mainstay of the Zimbabwean economy and CSAG ETF provides a credible means for the country’s agriculture activity to be reflected in the financial markets.

It invests in agriculture-related stocks that are listed primarily on the ZSE.

For the review period, the macro environment was characterized by predominantly a tight monetary policy regime, albeit with intermittent deviations.

The high interest rates were retained and statutory reserve ratios for banks were increased.

Agriculture is arguably the oldest profession and it has been reported that agriculture will be the next oil.

We are strong believers in this proposition. It is therefore incumbent upon us as Fund Managers to play our part in positioning Zimbabwe to take advantage of this development.

This is achieved through appropriate products in the financial and capital markets.

In light of this, it is our strategic intent to establish rapport with institutional and retail investors so that, via the Cass Saddle Agriculture Exchange Traded Fund, we can collectively channel the much-needed patient money into agriculture investments.

These developments had correlated increases and declines in the stock market, in many ways, a repeat of the volatility experienced in the prior ye In so far as performance is concerned, we do expect an upsurge in the price for two-pronged reasons.

Firstly, it is expected to catch up with the Net Asset Value. Secondly, we expect strong performance of the underlying stocks on account of population increases, accentuated by urbanization, not only in Zimbabwe but across the globe.

We hope farmers will be able to fully exploit the interventions by the government, to increase the amount of irrigable land through the construction of dams across the country, so that the effects of the predicted drought are not as severe.