Manager Research

In late February of this year, Prescient announced changes to their leadership. Firstly, long standing CEO Herman Steyn, who co-founded the business along with Guy Toms in 1998, has stepped down. He has been replaced by Cheree Dyers. Cheree has been with Prescient for the last 12 years, most recently as CEO of subsidiary Prescient Securities. Herman will still be involved in his position as Chairman of the broader Prescient group.  Overall, we were not concerned by the change in CEO.

The second change related to the investment team, where Prescient announced that CIO, Raphael Nkomo, will relocate to the UK to manage the expansion of their investment management capability there. Raphael has been replaced by Prescient co-founder and head of fixed interest Guy Toms.

A new CIO is typically a major change for an investment business, but as co-founder of the business, Guy is the custodian of Prescient’s investment philosophy and was previously CIO of the business.  In our opinion, Guy does not really want to be CIO and have the administration and people management responsibilities that come with the role.  His preference has always been to focus on the investments and, in particular, the fixed income portfolios.

Guy was also handed Raphael’s duties on the Prescient Absolute Balanced and Prescient Balanced funds, co-managing alongside Haakon Kavli.

Last week Prescient announced significant changes to their fixed income team.  We rate Prescient’s fixed income capabilities highly and specifically believe that Guy Toms is an exceptional fixed income portfolio manager with a unique understanding of the risk inherent in fixed income instruments.  Guy is key to the process, however the continual team changes are a concern. 

Three key members of their fixed income team have resigned (leaving end May 2018), with no indication of where they are moving to.

• Farzana Bayat was effectively Guy’s “second-in-command’. She worked closely with Guy from 2003 when she joined Prescient and we rated her highly. Apart from the loss of her experience and skillset, we are also concerned that Guy already has significant responsibilities on his plate as CIO and co-manager of the two Balanced funds.


• Ryan van Breda joined Prescient in 2009 and was a key member of the credit team. His experience is a loss to the team.


• Teresa Lu had been with Prescient for 7 years and was part of the money market team primarily as a money market dealer with daily fund management responsibilities.

That is a combined loss of approximately 30 years of experience at Prescient, which is significant.

Prescient have appointed Henk Kotze as a replacement for Farzana from 1 June.  Henk was previously at Green Oak Capital (a fixed income hedge fund manager) for 10 years, focusing on fixed income and money-market structures.  He has consulted to Prescient in the past so has a degree of understanding of the business and team.  We will need to spend time with Henk to assess his suitability to the business and role.

It is important to note that Prescient implemented new “talent retention” measures in March 2018.  Basically, Prescient made changes to the remuneration structure with the annual performance bonus adjusted to include a retention %.  We are waiting on further details on the specifics of what this entails.

We will be seeing Prescient in the coming weeks for a review across their entire business and fund range. For now, we believe that the key presence of Guy will ensure that the integrity of investment process will remain and we are comfortable with their funds in the short term. However, the changes are material and require an assessment of the potential long-term impacts. We will therefore retain the current ratings on the funds as per the table below, but will send an update following our review.