Investec won the Raging Bull Award for the Offshore Management Company of the Year after scoring the highest average PlexCrown rating for offshore funds that are registered with the Financial Services Board (FSB) in South Africa.
Investec’s Global Strategy Funds (GSFs) are domiciled in Luxembourg and managed by 130 investment professionals based in Cape Town and London.
The GSF team grew out of Investec’s acquisition of Guiness Flight Hambro in 1998. With R544 billion under management, Investec Asset Management now ranks as one of the top 100 largest managers of third-party assets (that is, assets that are not from the company’s other business).
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 the discipline of process, and each investment team has its own rigorous process.
To qualify for inclusion in the offshore management 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 (flexible and prudential combined) sub-categories, and it must also have at least three funds that are rated in the PlexCrown Fund Ratings.
Investec has 12 offshore funds that are rated in the PlexCrown Fund Ratings, and its average score for these 12 funds was, at 4.083 PlexCrowns, the highest among the qualifying managers for the periods to the end of December last year.
Investec’s Global Bond Fund (A) (Accumulating) achieved the top rating of five PlexCrowns and received a certificate for the best global bond fund on a risk-adjusted basis for periods up to five years at this week’s Raging Bull Awards ceremony.
Investec GSF’s Global Strategic Managed Fund (Accumulating), a global asset allocation flexible fund, also achieved five PlexCrowns.
Five other Investec funds achieved four PlexCrowns each. These were the Asian Equity Fund, the American Equity Fund, the Continental European Equity Fund, the Global Strategic Managed (Income) Fund and the Global Bond (Income) Fund.
The other funds achieved either three or two PlexCrowns each.
When the average scores of the qualifying managers in various sectors were compared, Investec’s offshore management arm came out top in fixed interest and global asset allocation.
Ferrini attributes Investec’s success in the offshore manager rankings to the manager’s development of its investment capabilities in-house, from scratch, and its high-calibre investment teams.
He says the asset allocation and fixed-income funds have generated value with a skilful re-entry into risk assets after the 2008 financial crisis. The asset allocation funds have had well-timed overweight allocations to equities, particularly emerging markets and Asian consumer themes.
Exposure to developed market government bonds was substituted for quality investment-grade debt, as well as exposure to high-yield debt. At the right time, the fixed-income team was overweight in risk assets (especially the High Yield Fund) and also investment-grade and emerging market debt.
Orbis was the manager with the second-highest average PlexCrown rating across its offshore funds registered in South Africa. Orbis, which is based in Bermuda, is the offshore sister company of local asset manager Allan Gray.
It has a similar investment philosophy to that of Allan Gray: investing in securities when these are below fair value.
Orbis obtained a rating of 4.000 PlexCrowns for the four funds it has that qualify for a rating.
The Orbis Global Equity Fund obtained five PlexCrowns. This is the fund into which the Allan Gray-Orbis Global Equity Feeder Fund invests. The feeder fund won the Raging Bull Award for the best foreign equity fund over three years to the end of December last year.
The Orbis Sicav Japan Equity Fund (yen class) also achieved a rating of five PlexCrowns.
The other two funds that qualify for PlexCrown ratings, the Orbis Sicav Asia Ex-Japan Equity Fund and the Sicav Japan Equity Fund (euro class), achieved three PlexCrowns each.
The Asia fund won a certificate for the best-performing offshore fund over three years in the Far East equity general sub-category.
Ashburton came third overall in the rankings of South African-registered offshore managers.
It has 10 Jersey-based funds that are available to local investors.
The Ashburton Replica Euro Asset Management Fund achieved five PlexCrowns and won the Raging Bull Award for the best-performing asset allocation fund on a risk-adjusted basis for periods up to five years ending December last year.
Ashburton’s United States dollar-denominated asset allocation fund, its income-distributing euro-denominated asset allocation fund, the Global European Equity Fund, and the Japan Equity Fund each achieved the second-highest PlexCrown rating of four PlexCrowns.
Among its five other funds, three achieved three PlexCrowns each, one obtained two PlexCrowns and the Global Sterling International Equity Fund obtained the lowest rating of one PlexCrown.