Manager Research

We have downgraded our rating on the Investec Global Strategic Equity fund from Tier 1 to Tier 2. The rating is still positive and the fund remains recommended, but we have some reservations.

Firstly, we are concerned that James Hand has left the team. James was co-head of the 4Factor franchise (Investec’s flagship equity franchise) alongside Mark Breedan as well as the deputy portfolio manager of this fund (Mark is the lead portfolio manager). James was also considered the architect of the 4Factor model and therefore carried a lot of experience in the technical aspects of the model. Secondly, while the overall strategy depends on both the quantitative 4Factor model as well as qualitative fundamental research performed by the equity analysts, performance has primarily been driven by the latter. The 4Factor model has not been adding value as we would have expected it to do as a major component of the process, which has lowered our conviction in the strategy.

It’s important to recognise that this is Investec's core global equity offering and therefore enjoys significant support from the shareholder and the business. The fund is also managed and supported by an experienced team, with sufficient resources to cover the opportunity set adequately.