Allan Gray investment summit 2018

During the Allan Gray investment summit held at the CTICC on the 17th of July, the differences among the investment opinions of the best fund managers in the business were notable. Some principles, however, they all agreed on. These were:

  • Stick to your investment strategy and process, even when all seems lost. Changing your strategy when the pressure is on, will most likely result in failure.
  • Evaluating an equity fund over a period of less than 5 years is futile. Companies can take a long time to live up to their potential. A successful fund manager will see the potential in a company long before it actually gets recognition from the market.
  • The world will always seem to be in chaos. There will always be some threatening situation, but over time the asset class that comes up trumps is equities. Holding on to cash is not an option.

Some of the other points that were made:

  • Naspers is a share to buy if you believe in Tencent and the power of online commerce, but to sell if you believe in valuation.
  • South Africa is 0,4% of the world economy, so you have to invest in the rest of the world to enhance your risk-to-reward ratio.
  • Bitcoin and other cryptocurrencies are not money and not an investment; they are a pure gamble.
  • The most successful fund managers get only around 54% of their stock picks right over time. Leaving the bad ones and holding on to the good ones determines success.
  • Off-the-cuff share calls were Allied Electronics, Northam, Naspers, Facebook, Woolworths, Glencore and Standard and Chartered Bank.
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