Fund man­ager in­sight

Finweek English Edition - - COMPANIES & INVESTMENTS - Cy Jacobs is a Port­fo­lio Man­ager with 36One As­set Man­age­ment.

SINCE IN­CEP­TION, the fund has of­ten been the best unit trust across all cat­e­gories for its life. As per its name, the fund has a very flex­i­ble ap­proach and is bench­mark ag­nos­tic.

Per­for­mance fees are charged at 12.5% on a two year rolling aver­age above the bench­mark. As you are aware, the fund has re­turned ap­prox­i­mately 21% net, to in­vestors, per an­num com­pounded since in­cep­tion.

The fund does not fol­low any in­vest­ment process based on any one in­dex, but rather fol­lows a bot­tom-up fun­da­men­tal theme based upon the team’s as­sess­ment of the best com­pa­nies, in the best in­dus­tries that best suit the cur­rent eco­nomic and reg­u­la­tory en­vi­ron­ment that we find our­selves in.

At present, the team is bear­ish on the do­mes­tic econ­omy in South Africa due to a wors­en­ing cur­rent ac­count, a stretched con­sumer, and a Govern­ment, which has done lit­tle to pro­mote growth and em­ploy­ment, or pro­vide the in­vest­ment world with a com­pre­hen­sive plan for the path to growth. We there­fore have 20% of our as­sets sit­ting off­shore, in­vested in pre­dom­i­nantly US con­glom­er­ates, in­clud­ing McDon­ald’s and John­son & John­son, while most of our do­mes­tic port­fo­lio ex­posed to SA listed com­pa­nies have off­shore op­er­a­tions, rand-hedge qual­i­ties, or are not re­liant on growth from SA.

We are gravely con­cerned about the prodi­gious pace at which credit has been ad­vanced to un­sus­pect­ing con­sumers, and the con­sumers’ in­abil­ity to re­pay th­ese loans due to the ex­or­bi­tant rates that are be­ing charged.

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