Manager Research
all members of our manager research team have over ten years of investment experience.
We have recently downgraded the Investec Global Strategic Equity fund from Tier 2 to Tier 3, as a reflection of our decreasing confidence in one of the core process components supporting the strategy. The fund makes use of Investec’s proprietary quantitative 4Factor model in combination with bottom up fundamental research performed by the team’s analysts for idea generation and stock selection. The model essentially serves as a guide, directing the analyst’s research capacity. However, we couldn’t find evidence that the model adds value as a source of investment ideas. Contribution to return was from stock selection by the analysts, and not the model.
Our concern is with the repeatability of the fund’s past performance where it only has a component of the process to rely on, which makes it difficult to distinguish between skill and luck. To add to this, the portfolio manager works from Hong Kong while his team is in London, which means the integration between him and the team responsible for the bulk of the fund’s performance is limited. As a result, we could not reach a sufficient level of confidence in the final outcome.
This process serves as a building block into the Investec Global Strategic Managed Fund, which is currently being reviewed by our team in the UK. We will communicate the outcome of the review in due course.
Investec Global Strategic Equity Fund downgraded to Tier 3
11 Dec 2018