Manager Research

Truffle announced that Jonathan du Toit has resigned from the business, with his notice period ending at the end of July to ensure a smooth handover of his responsibilities. He is currently a co-portfolio manager across their fund range along with Truffle’s CIO, Iain Power, and Charles Booth. We had a follow up call with Iain to discuss the rationale behind Jonathan’s departure and the impact on the team and the business.

Jonathan’s research responsibilities on the long only side has been reducing over the last two years as his focus shifted to running Truffle’s fledgling hedge fund business. He is effectively the custodian of their hedge fund process and his responsibilities in this space currently takes up a disproportionate amount of his time.

Jonathan’s departure on the long only side will be felt most acutely in their listed property coverage, where he is responsible for covering 12 counters. This will be re-allocated within the team, with Nicole Agar expected to take over the bulk of the coverage. Iain indicated that they would be looking to add capacity in this space by potentially hiring another analyst. Jonathan is also a senior resource in the investment team and his departure is a loss to the institutional knowledge and debate in the team. Furthermore, having worked at Orbis before joining Truffle, he was instrumental in establishing their offshore capability in the firm’s earlier years, so his knowledge and experience in that regard is a further loss.

However, Truffle still has an investment team of 10 individuals to fill the void in terms of Jonathan’s research responsibilities. Given the relative breadth and experience of the remaining team, as well as their team-based approach to implement investment decisions (i.e. co-portfolio management), we remain comfortable with their investment capability and have retained our ratings on the funds for now. We will be spending time with the team over the next few months for a full review of their fund range.