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Stock­bro­ker Spe­cial for boffins and be­gin­ners

THE STOCK­BRO­KER SPE­CIAL gets more in­trigu­ing as it be­comes in­creas­ingly clear how com­pet­i­tive this seg­ment of the mar­ket has be­come over the past few years.

Com­pe­ti­tion, of course, is good — re­sult­ing in bet­ter ser­vices at bet­ter prices to us or­di­nary in­vestors dab­bling in and around the JSE (and other bourses, might I add).

Good­ness knows, I cer­tainly needed my costs to be as low as pos­si­ble as I switched my port­fo­lio fran­ti­cally around in this das­tardly in­vest­ment cli­mate. I may have bought and sold Bri­tish Amer­i­can To­bacco (BAT) more times than I cheated on my Bant­ing diet (and I did a lot of cheat­ing).

On a se­ri­ous note, I would like to once again ex­press my grat­i­tude to the In­tel­lidex team on com­pil­ing an au­thor­i­ta­tive and ex­tremely use­ful sur­vey. There is a stack of valu­able in­for­ma­tion in this edi­tion, and I re­ally be­lieve it will help the en­deav­ours of bud­ding and ex­pe­ri­enced in­vestors alike.

This has been an in­ter­est­ing month for in­vestors, with two large un­bundling ex­er­cises and sep­a­rate list­ings pro­posed by JSE stal­wart coun­ters Naspers and In­vestec.

There has been a spate of un­bundlings — Sea Har­vest (out of Brim­stone), Premier Fish­ing & Brands and Ayo Tech­nol­ogy So­lu­tions (both AEEI), Novus (Naspers) and Hosken Pas­sen­ger Lo­gis­tics & Rail (HCI).

Un­bundlings — over many years — have given in­vestors plenty food for thought. It is prob­a­bly a gen­er­al­i­sa­tion, but it seems most un­bundlings are met ei­ther with ini­tial cyn­i­cism or a lack of in­ter­est.

MiX Telem­at­ics (spun out of Con­trol In­stru­ments), Mon­tauk (HCI) and As­tral Foods are a few of the more suc­cess­ful ex­er­cises, which were all ini­tially met with a luke­warm mar­ket re­sponse.

My gut feel is that In­vestec’s pro­posed (and long-awaited) un­bundling of wealth man­age­ment hub In­vestec As­set Man­age­ment (IAM) is likely to gar­ner more en­thu­si­asm than Naspers’s pro­posed un­bundling of Mul­tiChoice (which was pre­vi­ously listed on the JSE in a slightly dif­fer­ent guise).

Read­ing between the lines, the In­vestec brain­strust is gen­uinely heart sore to see a solid sub­sidiary leav­ing the group. IAP — like Coro­na­tion As­set Man­age­ment — needs to stand on its own to com­pete with the large as­set man­agers.

Naspers, on the other hand, is shoo­ing off a busi­ness that per­haps has less rel­e­vance in the “new” econ­omy than the rest of its on­line con­sumer ser­vices aligned port­fo­lio. Some pun­ters have com­pared the ma­ture Mul­tiChoice to BAT — com­pelling cash flows with mod­est growth prospects. But Mul­tiChoice’s brands are less habit form­ing in a fast chang­ing en­vi­ron­ment and there is less pric­ing power.

I cer­tainly would not buy Naspers to get an al­lo­ca­tion of Mul­tiChoice shares, but I might watch In­vestec for a chance to snaf­fle some IAM.

MARC HASEN­FUSS email Marc on hasen­fussm@times­me­dia.co.za

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