Fund manager

Finweek English Edition - - FUND IN FOCUS - Co- manager Cor Booy­sen

says that their ap­proach can’t be summed up in any one word. “We blend value and growth ap­proaches, but we have a strong pref­er­ence for high- qual­ity busi­nesses that are dom­i­nant in their in­dus­tries. And we are con­sis­tent in fo­cus­ing on busi­nesses that gen­er­ate large cash flows.”

This doesn’t mean they ig­nore broader eco­nomic trends. They pay close at­ten­tion, but re­alise that try­ing to fore­cast what hap­pens next is fu­tile. A case in point was Sa­sol. “Last year, we had close to 7% of the fund in Sa­sol at the end of Septem­ber − it was one of the best ideas in the fund. But by the end of Oc­to­ber, we were out of Sa­sol and we had moved into com­pa­nies that would ben­e­fit from lower oil prices.” The fund sub­se­quently added to po­si­tions in re­tail­ers like Wool­worths, Sho­prite and Fos­chini.

An un­usual pick is In­vestec. “We think it ’s priced like a bank, but it i s ac­tu­ally half an as­set manager. So we think I nvestec i s grossly un­der­val­ued and that there is up­side po­ten­tial in earn­ings as they work out all the bad loans from the sys­tem. There is also a mas­sive off­shore earn­ings com­po­nent which we find at­trac­tive,” adds Booy­sen.

With fund as­sets at around R2bn, there is the flex­i­bil­ity to in­vest i n small caps. “We know the high- qual­ity com­pa­nies well − but the com­bined to­tal of small caps in the fund will never be more than 5% of the port­fo­lio.”

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