FOR INDIVIDUALS

Individual investors can support transformation in the asset management industry by supporting black-owned fund managers’ unit trust funds.

The following funds from black-owned fund managers are listed among the top 10 funds on performance over various periods in their respective unit trust sub-categories for periods of three years or longer:

SOUTH AFRICAN GENERAL EQUITY

Mazi Capital Prime Equity Fund: 5th out of 94 funds over five years with an annual return of 16.02 percent.

Mergence Equity Prescient Fund: 8th out of 94 funds over five years with an annual return of 14.98 percent.

SOUTH AFRICAN EQUITY LARGE CAP

Kagiso Top 40 Tracker Fund: 4th out of six funds over 15 years with an annual return of 12.83 percent.

SOUTH AFRICAN MULTI-ASSET FLEXIBLE

Noble PP STANLIB All Weather Fund of Funds: 10th out 29 funds over 10 years with an annual return of 9.49 percent.

SOUTH AFRICAN MULTI-ASSET INCOME

Pan-African IP Income Hunter Fund: 3rd out of 50 funds over three years with an annual return of 8.65 percent.

SOUTH AFRICAN REAL ESTATE

Sesfikile BCI Property Fund: 2nd out of 22 funds over five years with an annual return of 20.12 percent.

WORLDWIDE MULTI-ASSET FLEXIBLE

Argon BCI Worldwide Flexible Fund: 1st out 54 funds over three years with an annual return of 46.71 percent. helpful role as incubators of new managers, he says.

The survey notes that supporting new managers does not mean investors have to compromise on returns.

Research has shown that small boutique managers are able to exploit investment opportunities in which larger managers cannot invest, Southey says.

Small managers’ interests are more aligned with those of investors; they have more investment opportunities, as they can invest in smaller shares that large managers cannot invest in without owning a significant stake of the business; and they have the ability to trade in and out of positions quickly without affecting the market.

Trustees of funds that want to incubate a manager need to develop a clear policy to support the strategy and to get stakeholders to support the programme.

The policy should state how much will be invested with these managers, what type of manager will be supported, and it should set out how decisions will be made and reviewed, Southey says.

Trustees can implement their own incubation strategies through an investment consultant or they can use a solution provider, such as a multi-manager.