This low-risk fund is ideal for investors who would like to diversify their investments offshore and require regular and stable income that targets US inflation beating returns over the long-term, while actively managing risk of capital loss in the short-term. The recommended investment time horizon is 3 years.
Investors looking to diversify in a low- risk offshore fund and that requires consistent above cash and inflation returns whilst generating a healthy income from a diverse portfolio of actively managed income assets, making it suitable for retirement capital.
An investment time horizon of at least 3 years is recommended.
To invest in the Offshore fund directly through Northstar email admin@northstar.co.za.
* It is the client’s responsibility to ensure the SARS requirements to transfer funds offshore are met however Northstar can put you in contact with a Foreign Exchange Service Provider to assist with these requirements.
US$ 1 000 Class C / US$ 300,000 Class B
For LISP access, please contact Alex Holmes at aholmes@northstar.co.za
The Northstar Global Income Fund delivered a strong quarterly return of 4.2%, outperforming the median of its peers at 3.1%. This performance was bolstered by robust contributions from US Treasuries and global equity exposures, which helped navigate a particularly volatile second quarter. Despite initial volatility, global equity markets posted strong returns of over 10% for both US and international equities.
The market sell-off was triggered by President Trump’s announcement on April 2, which imposed a 10% tariff on all countries, effective April 5, under a national emergency declaration. This led to a sharp decline in global equity markets, a rally in bond yields, and a surge in gold prices.
However, investor sentiment reversed seven days later when the tariff implementation was paused for 90 days for most countries, fostering a resilient market recovery despite ongoing geopolitical tensions, tariff discussions, political tensions with the Federal Reserve, and heightened fiscal concerns.
Key supportive factors included strong corporate earnings, rapid advancements in artificial intelligence , ongoing economic resilience, signs of contained inflation, and the likelihood of lower interest rates, which have lifted investor sentiment.
Throughout this period, the fund maintained stability, with Treasury holdings and a small gold position effectively offsetting the volatility in global equities. Global equities rose 11.6% in Q2, with substantial contributions from Information Technology stocks (Palo Alto and Oracle, Microsoft), Industrials (DSV and Airbus), Consumer Staples (Reckitt and British American Tobacco), Financials (Mastercard and Visa), and Consumer Discretionary (Accor, Evolution, and Chipotle). Conversely, Healthcare stocks such as Thermo Fisher and Elevance detracted from returns. The Energy sector, which we don’t have exposure to, was the worst performer, down 8.6%.
The fund’s predominant holdings in US Treasuries also provided modest gains as yields initially rallied to 3.9% before floating back above 4.4%, levels that continue to offer attractive value amid contained inflation (CPI rose to 2.7% annually in June) and gradual interest rate reductions expected over the next couple of years.
As we enter the second half of the year, markets are likely to remain volatile, influenced by the interplay between policy uncertainty, such as ongoing tariff negotiations under the Trump administration, including recent threats of 30% tariffs on EU and Mexico imports, and fiscal concerns and broader business cycle dynamics, including escalating tensions in the Middle East.
Despite these challenges, positive drivers such as strong corporate earnings, technological advancements in Artificial Intelligence, and stabilising inflation could support a continued recovery in select sectors. The potential for 75 basis points worth of interest rate cuts over the next year may further bolster fixed income and equity performance, particularly for undervalued companies that we have been adding to. However, geopolitical tensions and policy shifts remain key risks that could introduce further swings.
Overall, the environment suggests opportunities for cautiously managed portfolios that emphasize diversification and risk management, with fixed income re-emerging as a reliable return driver and stabilizer in a post-zero interest rate era.
The Northstar Global Income Fund is strategically positioned with 21% exposure to a broad range of quality global equities and the balance in fixed income comprising predominantly of US Treasuries. The portfolio holdings have a focus on high-quality with attractive valuations to capture upside potential in areas like Health Care (Elevance and Thermo-Fischer), Consumer (Reckitt Benckiser and Amazon), Financials (Visa and Mastercard), IT (Adobe and ASML) and Communication Services (Alphabet and Tencent), while the balance is allocated to fixed income, of which 63% is in US Treasuries across the curve with a weighted average maturity of 3.2 years.
This structure leverages the attractive real yields in fixed income, now hovering near 4.5% for the 10 -year Treasury, which adequately compensate investors for risk and serve as both a return enhancer and a diversifier against equity volatility. The 0.5% gold holding continues to provide a hedge against geopolitical uncertainties, including ongoing trade tensions and Middle East conflicts.
We believe this allocation equips the fund to navigate upcoming challenges and opportunities in a volatile landscape. The portfolio remains well diversified and appropriately positioned to deliver a 2% real return for low-risk investors.
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