Podcast: Fixed Income Investing: How to Move Beyond Cash in a Balanced Portfolio

Why Fixed Income Matters 

Fixed income is often overlooked by retail investors, yet it plays an important role in building balanced portfolios. Yusuf Wadee, Head of Exchange Traded Products at Satrix, explains that fixed income helps manage volatility and drawdowns, supporting more consistent investor outcomes across market cycles. 

Understanding diversification is key to this approach. Learn more here.

Why Cash Often Becomes a Long-Term Holding 

Many investors intend to hold cash temporarily, only to leave it parked for far longer than planned. Yusuf Wadee highlights the behavioural risk of excess cash sitting in low-yield accounts or broking platforms while investors wait for the “right time” to invest. 
 

The Role of the Satrix Income Actively Managed ETF (AMETF) 

The Satrix Income AMETF is designed for investors seeking an alternative to traditional cash exposure, without taking on the higher risk associated with longer-duration bonds. The ETF is listed on the JSE, offering broad accessibility through stockbroking platforms. The fund is actively managed by Ninety One, with James Turp, Fixed Income Portfolio Manager, responsible for portfolio construction and positioning along the yield curve. 
 

Why Active Management Works in Fixed Income 

Short-term fixed income does not lend itself easily to traditional index tracking. Yusuf Wadee explains why active management is better suited to this space, particularly when seeking to earn a term premium while managing interest rate risk. 
 

How Active Fixed Income Aims to Add Value 

James Turp, Fixed Income Portfolio Manager at Ninety One, explains that fixed income portfolios are built around inflation and monetary policy. By using a mix of fixed-rate and floating-rate instruments, the strategy seeks to deliver cash-plus returns while keeping volatility and drawdowns low. 
 

Liquidity Through the ETF Structure 

Both Yusuf Wadee and James Turp emphasise that the ETF is traded daily on the JSE, providing liquidity while allowing the portfolio to earn a term premium through its underlying investments. 

Tax-Free Savings Accounts (TFSA) 

Yusuf Wadee confirms that the ETF is available on SatrixNOW and other tax-free platforms that offer JSE-listed exchange-traded funds. 

Learn more about using a TFSA for long-term investing.

Closing Thought 

Fixed income is not about fixed returns. It is about discipline, diversification, and aligning investment strategies with real investor behaviour. Understanding this part of the market is key to building resilient portfolios. 

The Satrix Income AMETF is designed for investors seeking an alternative to traditional cash exposure, without taking on the higher risk associated with longer-duration bonds. The ETF is listed on the JSE, offering broad accessibility through stockbroking platforms. 

Click here to listen and learn More Here:

AMETF
ETF

Disclaimer:

Satrix Managers (RF) (Pty) Ltd a registered and approved Manager in Collective Investment Schemes in Securities. Collective investment schemes are generally medium- to long-term investments. With Unit Trusts, Exchange Traded Funds (ETFs) and Actively managed ETFs (AMETFs) the investor essentially owns a “proportionate share” (in proportion to the participatory interest held in the fund) of the underlying investments held by the fund. With Unit Trusts, the investor holds participatory units issued by the fund while in the case of an ETFs and AMETFs, the participatory interest, while issued by the fund, comprises a listed security traded on the stock exchange. ETFs and AMETF are registered as a Collective Investment and can be traded by any stockbroker on the stock exchange, LISP platforms and or via online trading platforms. ETFs and AMETFs may incur additional costs due to it being listed on the JSE. Past performance is not necessarily a guide to future performance, and the value of investments / units may go up or down. A schedule of fees and charges, and maximum commissions are available on the Minimum Disclosure Document or upon request from the Manager. Collective investments are traded at ruling prices and can engage in borrowing and scrip lending. Should the respective portfolio engage in scrip lending, the utility percentage and related counterparties can be viewed on the ETF and AMETF Minimum Disclosure Document. The index, the applicable tracking error and the portfolio performance relative to the index can be viewed on the ETF and AMETF Minimum Disclosure Document. International investments or investments in foreign securities could be accompanied by additional risks such as potential constraints on liquidity and repatriation of funds, macroeconomic risk, political risk, foreign exchange risk, tax risk, settlement risk as well as potential limitations on the availability of market information. AMETF are ETFs which are actively traded by a Portfolio Manager to adjust the AMETF holdings and asset allocation with the aim to outperform the benchmark. AMETF differ from ETFs which only track indices. The Manager does not provide any guarantee either with respect to the capital or the return of a portfolio. Satrix retains full legal responsibility for the co-named portfolios. 

The management of investment are outsourced to Sanlam Investment Management (Pty) Ltd is an authorised Financial Services Provider (FSP No. 579) and forms part of the Ninety One group of companies.