A carefully selected universe of investment opportunities on offer
A rigorous and exhaustive research process allows the investment committee to find the right funds that best meet clients’ needs
Brenthurst Wealth’s house view for the past decade has been that aggressive offshore diversification is the best way to preserve and grow clients’ wealth. While this position has remained steadfast, it has never been about gaining offshore exposure at all costs.
The choice of industry, asset classes and instruments is a rigorous process that aims to eliminate bad decisions and maximise long-term returns.
Led by investment strategist Magnus Heystek, Brenthurst’s research process is built around thorough due diligence. Apart from tapping industry news and knowledge, the firm seeks out expert views of political and economic analysts, and local and global asset managers, to draw the most accurate conclusions.
MD Brian Butchart, director Johan Burger and adviser Gustav Reinach also serve on the investment committee.
“We follow global megatrends when it comes to asset allocation,” Heystek says. “Based on our global macro analysis we’ve identified technology, biotechnology, health care and demographic themes that we believe are growth sectors.
“Once we’ve identified the megatrends, we will investigate which funds, assets classes or instruments will give us exposure to a trend. This is then distilled and analysed by the investment committee to produce a list of 50 or 60 funds that give us exposure to those trends.”
Heystek says this search for the right funds is an exhaustive one, and Brenthurst has been known to introduce offshore funds when local equivalents are not available. He uses the example of the Fidelity Health Care Fund and Franklin Biotechnology Discovery Fund that was made available to his clients.
Once confident that the funds offer clients a range of options that meet their risk appetite and investment objectives, these are added to the Brenthurst Wealth “menu” of funds.
Armed with this fund menu, Brenthurst advisers are then able to select the funds that best meet a particular clients’ needs.
This flexibility is one of the major advantages that the firm’s independence gives it over institutional investment managers that are often restricted to selling house funds. Best of all, the institutional funds that do offer growth potential are still available for Brenthurst to tap into.
This has been done to great effect with Ninety One (formerly Investec Asset Management), with which Heystek has had a close relationship going back more than 25 years. Today, Ninety One is one of SA’S largest asset managers, and Brenthurst is one of its biggest independent financial adviser investors.
Heystek says the Ninety One Global Franchise Feeder Fund is an example of a fund that has not only proven popular with clients, but also delivered exceptional returns.
He has equally high praise for Sygnia Asset Management after a successful partnership over the past few years. He credits them for introducing innovative products like its 4th Industrial Revolution Fund, FAANG Plus Equity Fund and Sygnia S&P 500 Fund that
offer exposure to Brenthurst’s investment megatrends.
This rapidly strengthening relationship has also opened opportunities in the unlisted space. This has come about through the Sygnia Oxford Sciences Innovation Fund, to which Brenthurst Wealth received and filled a R100m allocation on behalf of its clients.
This investment, which has plans to list within the next five to 10 years, has taken on even greater significance as it is one of the frontrunners in the race to develop a Covid-19 vaccine.
“We’re looking to do more of those types of deals,” says
Heystek. “It’s clear that our clients like that we’re able to offer them something different, and I think that’s what high net-worth clients want.”
Brenthurst’s ability to offer tailored solutions to clients has now also been bolstered with an exclusive partnership with online
What it means:
"Menu" of funds offers a broad range of options to meet any risk appetite
trading and investment research provider Sharenet Investments.
“We can now offer a global share portfolio to our clients, which is something we’ve not had until now,” Heystek says. “So, if a client wants to invest directly in shares, we will help them identify them and place them in a share portfolio, but the clients will do the actual buying and selling, which also reduces costs.”
This development follows demand from clients to invest directly in local and global markets. Heystek is quick to point out that the service isn’t meant to facilitate day trading, but rather allow clients to build a bespoke portfolio that supplements their investment in other asset classes.
We follow global megatrends with our asset allocation