We all know her name
Magda (Wierzycka) is that rare person, like Beyoncé or Cher, who is often known by just one name. Even Lady Gaga has two. Her day job is CEO of Sygnia, a financial shop which derives much of its income from the unglamorous “plumbing” services such as administration. Its backbone includes the Platinum investment administration system and the liability or member administration which underpins its Sygnia Umbrella Retirement Fund.
She even exited the one high-margin sector in which the business had built up expertise: its funds of hedge funds. Of course it coincided with a sharp decline in investor interest in these products. And it was perfect timing for the head of hedge fund of funds unit, Simon Peile (he happens to be Wierzycka’s husband), who was keen to spend more time peering through his binoculars at birds. That’s not to say Sygnia isn’t launching some unusual products. Its Sygnia Faang Plus Equity Fund has been operating for six months.
Wierzycka says there was client demand for exposure to technology giants. This fund is 13% in Alibaba, 12.2% in Facebook, 11.8% in Amazon, 11.5% in Alphabet (Google) and 11.3% in Apple. I couldn’t help thinking of the Investec Wired Index Fund, launched 20 years ago, which offered the top 40 “new economy” shares, including the shady Enron. And to meet the fad for investing in cellphone operators and mobile technology, Investec later launched the Wireless World Fund.
These funds ended up being merged into a far blander entity. When fashions change, perhaps Faang will go the same way. But Wierzycka was probably ahead of her clients when, in 2017, she launched the 4th Industrial Revolution Global Equity Fund, which is far more diversified. The biggest holding is scientific equipment developer Bruker, at 1.3%. Another demand-driven portfolio is an investment into Warren Buffett’s Berkshire Hathaway via a Sygnia endowment policy, with no need to tap into the foreign exchange allowance.
Clients can put bitcoin investments into their Sygnia portfolios, but the bid to launch a bitcoin exchange traded fund was stopped by the JSE a few days before takeoff, even though the Reserve Bank gave consent.
Multimanager traction
The future of Sygnia, though, will depend more on the core multimanager funds and the traction they get in the market against larger, better-funded competitors such as Alexander Forbes, Old Mutual and Momentum.
Asset consultants will need to give some attention to Sygnia: over the past five years the Signature 70 and Signature 60 portfolios are both top of their sectors. These are a blend of active and index funds. The more recently created Skeleton is entirely index-based, though there is still human intervention through frequent tactical asset allocation. Skeleton was a natural sub-brand for Wierzycka, who believes you can’t be too rich or too thin. She is naturally mercurial and not naturally patient, but she has brought professional management into the business, including levelheaded Alexander Forbes veteran David Hufton as deputy CEO. A new head of human resources will be joining from one of the large accounting firms.
Wierzycka has not given up on her international goals. She has an office in London’s pricey Mayfair district which, she says, is a lot more credible than working out of hotel rooms. Once some of the Brexit fog has cleared, she hopes to set up a cut-price retail business.
Wierzycka is naturally mercurial and not naturally patient, but she has brought professional management into the business