Investec this week won the Raging Bull Award for the offshore management company of the year for the second year in a row, after scoring the highest average PlexCrown rating for offshore funds that are registered with the Financial Services Board (FSB) in South Africa.
Mimi Ferrini, the head of investments at Investec’s London operation, says Investec does not have an over-arching house philosophy or style; it believes in small focused teams that specialise in various investment areas.
However, the company also believes that successful investing requires a disciplined process when selecting shares.
To qualify for inclusion in the offshore company rankings, a manager of funds registered in South Africa must have at least one fund in the global equity general or the global asset allocation sub-categories, and it must also have at least three funds that are rated in the PlexCrown Fund Ratings.
Investec has 10 offshore funds, domiciled in Luxembourg, that are rated in the PlexCrown Fund Ratings, and its average score for these 10 funds was 3.722, the highest among the qualifying managers for the periods to the end of December last year.
The Global Strategic Managed Fund (Income) won the Raging Bull Award as the top offshore global asset allocation fund for its performance on a risk-adjusted basis over five years. Both this fund and the Investec GSF Global Strategic Managed Fund (Accumulating) achieved the top rating of five PlexCrowns each.
The Asian Equity Fund (Income) and the Global Bond Fund (A) (Accumulating) achieved four PlexCrowns each.
Once the average scores of the qualifying managers in the various sectors were compared, Investec’s offshore management arm came out top in global asset allocation and Far East equity, Ryk de Klerk, a director of PlexCrown Fund Ratings, says.
Ferrini says a factor that led to Investec GSF’s success was that the asset allocation (multi-asset) and fixed-income funds had very little pure credit exposure in 2008 and rebuilt exposure aggressively in 2009, he says.
The asset allocation funds had a well-timed overweight allocation to equities, particularly in emerging markets and Asian consumer shares.
Investec substituted its exposure to developed market government bonds for quality corporate bonds, as well as exposure to high-yield debt, he says.
Stanlib was the runner-up in the offshore management company rankings, with an overall rating of 3.472.
Stanlib has eight foreign currency-denominated funds that are rated in the PlexCrown ratings. Only one, the Global Bond Fund, obtained the highest rating of five PlexCrowns.
Five funds obtained three PlexCrowns and two obtained only two PlexCrowns.
The Global Bond Fund gave Stanlib first place relative to its peers in the fixed-interest sector.
De Klerk says Stanlib’s rating in the overall equity sector was watered down by a relatively weak showing in the global equity sector and the European equity sector.
Ashburton shared third place with Alexander Forbes in the offshore management company rankings. They both achieved an overall rating of 3.250.
Ashburton has 10 offshore funds registered in South Africa. Seven obtained four PlexCrowns each and three obtained only one PlexCrown each.
Ashburton topped the rankings in US equity and European equity, while the company’s overall rating was boosted by a second position in the global asset allocation category.
Alexander Forbes has four offshore funds for South African investors that qualify for PlexCrown ratings. One obtained four PlexCrowns and three obtained three PlexCrowns each.
Alexander Forbes was placed third among its peers in the sub-category for global asset allocation funds.
Ranking of offshore management companies to December 31, 2011
1. Investec: 3.722
2. Stanlib: 3.472
3. Ashburton: 3.250
3. Alexander Forbes: 3.250
5. Franklin Templeton: 3.135
6. ACPI: 3.000
7. Standard Bank: 2.667
8. Lloyds: 2.630
9. Nedgroup Investments International: 2.250
Source: PlexCrown Fund Ratings