Give a Christmas gift that will keep on giving

Why not make a real difference this Christmas? Don't just give expensive gifts which could be donated to the next white elephant stall. Give someone you love an opportunity to lift the quality of their lives. Liz Still presented a range of scenarios to different unit trust companies. An edited version of this article first appeared in the December 11th edition of the Sunday Times.

Unit trusts as Christmas gifts can teach children the importance of saving and delayed gratification. And extra support for people who you love is somehow more acceptable to them in the spirit of Christmas. But having made the decision to give unit trusts to the people on your list, you have to be able to choose wisely.

In this survey, we only approached unit trust companies with wide ranges of options within their suite of funds. We spoke to Jeremy Gardiner, a director at Investec Asset Management, Craig Gradidge, Marketing Manager of Old Mutual Unit Trusts, Paul Hutchinson: Head of Marketing, Nedgroup Collective Investments, Ed Abbot: Head of Stanlib One, Stanlib Collective Investments, Pieter Koekemoer: Head of Unit Trusts, Coronation Asset Management and Philip Knibbs: Sales Director, RMB Unit trusts.

As a grandparent, you can't actually understand the need for electronic toys, and certainly can't bring yourself to buy a T Shirt for R500. What happened to old fashioned common sense? But you have got more money than you need right now, and you would like to start an investment for your 10 year old grandchild. The grandchild will only have access to the money when it turns 21.

Jeremy Gardiner: The Investec Equity Fund managed by Gail Daniel.
Craig Gradidge: Our Four Plus Global Fund is a fund with an extremely flexible mandate. The grandchild would get exposure to the major asset classes - locally and internationally.
Paul Hutchinson: The Nedbank Rainmaker Fund managed by Tim Allsop of Polaris Capital.
Ed Abbot: The Stanlib Multi-Manager High Equity Fund of Funds, as the investor has a long-term investment horizon and historically equities have outperformed over the long-term.
Pieter Koekemoer: The Coronation Balanced Fund. We believe that it is important to be in a fund where the fund manager has the mandate to actively manage asset allocation which means equity exposure can be reduced when appropriate and opportunities in other asset classes can be exploited.
Philip Knibbs: The RMB High Tide Fund. Although equities have a proven track record of superior growth over time, they do not do so in a linear fashion (straight line) and there may be times when it is prudent to 'bank' some returns in less volatile asset classes.

A debit order investment for your trusty domestic helper. Your helper is 50 and wants to retire in 15 years time. This portfolio should be conservatively managed and should not lose capital. It is likely that she will withdraw the lump sum when she retires to spend on setting herself up for retirement as she wants to set up a vitamin shop near her home outside Rustenburg.

Jeremy Gardiner: The Investec Absolute Balanced Fund, an absolute return fund which aims to beat inflation by 4% per annum after fees under current market conditions and give only positive rolling 12-month returns.
Craig Gradidge: Our Dynamic Floor Fund would be the most appropriate solution. The fund provides capital protection without giving up too much equity upside.
Paul Hutchinson: The Nedbank Managed Fund, managed by Piet Viljoen of RE:CM.
Ed Abbot: Our Stanlib Multi- Manager Low Equity Fund of Funds. This fund provides investors with a well-diversfied low risk portfolio of assets that aims to produce real returns with a low probability of capital loss over a three year period.
Pieter Koekemoer: The Coronation Absolute Fund
Philip Knibbs: The RMB High Tide Fund.

Your elderly parents. Your mother is 65, your father is 70. They have had difficult working lives with multiple retrenchments and have not accumulated enough money to retire on. However, now it is payback time; you recently caught a bit of action in a BEE deal and now you want to help them. You want to invest in a unit trust fund on a debit order basis which provides them with a regular income (could be monthly or quarterly) but which also has a bit of capital growth.

Jeremy Gardiner: The Investec Absolute Income Fund an absolute return fund which currently aims to beat inflation by 3% per annum after fees. Craig Gradidge: The most suitable option in this challenging scenario would be a fixed interest - varied specialist fund. Our Enhanced Income fund seeks out yield from a range of fixed interest instruments.
Paul Hutchinson: The Nedbank Flexible Income Fund, which aims to maximise income by actively repositioning the portfolio between cash, bonds and other fixed interest securities, depending on prevailing economic conditions.
Ed Abbot: The Stanlib Income Fund, which is the house view of the Stanlib Fixed Interest team. The fund aims to provide a reasonable level of fixed income and maximum capital stability.
Pieter Koekemoer: We would suggest a combination of the Coronation Capital Plus Fund (60%) and Coronation Strategic Income (40%).
Philip Knibbs: The RMB Income Plus Fund of Funds which is part of our recently launched risk profiled range. Capital stability is key.

You owe your personal trainer big-time. She saved your life. There you were pushing weights three months ago when the heart attack came, swift and fast. She knew her CPR and she flew into action, not giving up even though others told her it was no use. She has told you that she would really like to go to the Beijing Olympic Games in 2008 and you want to be able to give her about R25 000. You want to invest a dedicated sum of R400 per month for two years, (24 months) to get as close to that target as possible. But you don't want to lose money either.

Jeremy Gardiner: The Investec Opportunity Fund, the least conservative of Investec's absolute return fund. This fund aims to preserve capital and aims to beat inflation by 6%, net of fees.
Craig Gradidge: This is a difficult one as the required level of growth is unrealistic. The investor should consider an aggressively managed flexible fund with a solid track record within strict risk controlled parameters, like the Old Mutual Flexible Fund.
Paul Hutchinson: It is extremely unlikely that such an investment will return R25 000. Before suggesting any fund we would therefore recommend that the investor's expectations be adjusted. However, to get as close to the target as possible, while trying not to lose money, we suggest the Nedbank Managed Fund.
Ed Abbot: The Stanlib Managed Flexible Fund, a fund which targets a return of CPI plus 5% per annum. The fund is managed by Errol Shear.
Pieter Koekemoer: The objective of R25000 from 24 x R400 over 2 years would require a return of about 90% which is very unlikely without taking extreme risks. The objective of the Coronation Capital Plus Fund is to provide above inflation returns while protecting capital over a rolling 12 month period.
Philip Knibbs: R400 per month for 24 months to deliver R25 000 without the risk of losing capital? That sounds like your typical investor with unrealistic expectations. I'm afraid the only solution here is to abandon the risk of losing capital concern and head straight for your local Lottery vendor.