Fund manager insights:
FUND MANAGER Sean Ashton says that Anchor’s pragmatic approach to investing often sees them meeting with management teams in order to ‘kick the tyres’ of businesses.
While the fund is not tied to any one approach, it does prefer to buy good quality businesses at reasonable prices. This can also include smaller companies, or non-index shares, that display the same characteristics of larger businesses and for which the fund thinks has a suitable margin of safety priced into its valuation. An example of this in the portfolio would include the Spur chain of restaurants.
But much of the performance that the fund has delivered so far has come from large-cap stocks. The fund bought Steinhoff at R23/share and benefitted as the share price surged to R40+/share. Stein- hoff remains the fund’s largest holding. Naspers* is another high-quality company that the fund bought low (at R625/ share) and has continued to hold.
An unusual holding in the fund is that of the Alexander Forbes Preference Share Investments. Ashton said that the fund began acquiring the share at levels around R13, and thinks its intrinsic value could be as high as R20/share. The unwinding of debt structures in advance of a listing on the JSE by Alexander Forbes this year means that shareholders could realise this value sooner rather than later. Lately the fund has moved quickly to increase it weighting to resources through its exposure to Anglo and BHP Billiton.
Portfolio Manager: Sean Ashton
*Finweek is a Media24 publication, which is a subsidiary of Naspers.