Unconventional
thinking
Thinking deeply
We have been managing investments on behalf of institutional clients since 2001. As the choice of many sophisticated retirement funds and their institutional consultants, we have a longstanding and substantial presence in the institutional market in South Africa. This scale enables us to afford the best investment, compliance and operational resources that are so critical for a modern investment firm.
We offer a narrow range of funds across the risk spectrum, specifically specialist equity, bond, money market and absolute return funds, as well as global and domestic balanced funds that combine asset classes.
Our funds are generally available in segregated or pooled forms, with certain funds also available as collective investment schemes (CIS). Investments in similar mandates are variants of the same investment research process with different risk and reward objectives.
Investment approach
Philosophy
"New perspectives present new ideas."
Opportunities arise when market prices deviate from intrinsic value
We focus on valuing expected long-term cash flows rather than predicting the future or reacting to newsflow. We believe excess returns often arise from areas of neglect and disfavour and we particularly aim to avoid crowded optimism. In a world that is obsessively focused on the short term, we believe our long-term orientation enables us to look through the noise of self-reinforcing cycles of enthusiasm or negativity – a robust competitive advantage.
We make investment decisions based on mispricings we observe in the market. Simply put, we buy investments at prices well below our estimation of their intrinsic value, hold them while they deliver strong cash returns and until they can be sold above this value.
The future is never certain
There is considerable danger in operating with the comfort of a false sense of certainty. This can
lead to overreactions in the market and a distorted evaluation of new information. This drives us
to think more deeply, to work harder and to be more alert. We, therefore, view the future in terms
of probabilities, exploring alternative scenarios and potential asymmetries, diversifying our positions and hedging risk.
Philosophy
"New perspectives present new ideas."
We follow a ‘bottom-up’ investment process to harness our investment philosophy in a disciplined, yet flexible manner – enabling creative and rigorous thinking.
Original research in pursuit of attractive investment opportunities
Most of our time is spent undertaking in-depth company, industry and individual security research to provide an accurate assessment of the merits of a particular investment and to
identify the key drivers of its future cash flows.
We analyse information to identify the sustainable, ‘normalised’ economics that impact an investment. We strive to understand structural and cyclical forces in operation, to adjust for temporary distortions to cash flows and to conduct a long-term analysis of the history of the business and industry.
Portfolio management effectively balances risks and returns
Our portfolio managers are held individually accountable for client outcomes as we believe this leads
to better decisions. They maintain a patient, long-term outlook to constructing well-diversified
portfolios, balancing expected returns from mispricings, perceived risks, and available portfolio holding size.
We pay careful attention to risk management and positioning for asymmetric potential results.
Funds designed to meet enduring needs
Our range of cost-effective and transparent equity and multi-asset class funds are designed to meet the enduring needs of our investors. They are available in segregated or pooled forms, or as unit trusts to individual investors. Our funds are complementary and are clearly differentiated by expected risk and return characteristics. We also offer a specialist bond and money market fund for institutional clients.
