The Effective Annual Cost (EAC), expressed as a percentage of your investment amount, is a measure which has been introduced to allow you to compare the cost you incur when you invest in different financial products.
The EAC is made up of four charges which are added together, as indicated below:
- Investment Management
Some of the charges may vary, depending on your investment period. The EAC calculation assumes that an investor terminates his or her investment in the financial product at the end of the relevant periods shown in the table
PLEASE NOTE: To determine the EAC for a specific Satrix ETF, please utilise the EAC calculator available just a short scroll down, on our Satrix.co.za site HERE
To use the calculator simply:
- Select the particular ETF you are interested in from the Fund dropdown (number 1 in the image below)
- Select whether you will contribute a lumpsum amount or monthly (number 2 in the image below)
- Input the lump sum or monthly amount you want to invest in the cell shown by the number 3 in the image below.
Once you've input the data and hit the light-blue calculate button, the calculator will present the 4 different charges making up the EAC, as well as the total EAC figure for 1, 3, 5, and 10 year periods - as seen in the image below.
- The investment management component includes all costs and charges for managing the underlying investments within the fund;
- The advice fee charge is not applicable to the SatrixNOW platform;
- Administration includes the cost of administering the recurring investment facility which allows investors the ease of automatically allocating their ETF trade on a monthly basis. It is calculated as 0.20% (Excl. VAT) of the investment amount. The recurring investment fee is not applicable to lump-sum investments;
- Other charges includes brokerage charges (0.25% excl. VAT), Investor protection levy (0.0002% excl. VAT) and STRATE electronic settlement fees (0.075% excl. VAT) incurred on the buying and selling of ETFs.
All calculations include value-added tax (“VAT”) at the prevailing rate, where applicable. Where applicable, inflation has been taken into account when calculating the EAC.