High-profile share price collapses, the most notable being Steinhoff, are making asset managers tread more carefully when it comes to investing in South African listed companies.  Several asset managers warned at the Investment Forum in Sandton on Wednesday that just because a company was trading at a discount to its underlying value did not mean it offered good investment opportunities.  Given the recent significant drop in the value of companies such as Steinhoff, EOH, Aspen and Tongaat Hulett, weighing their risk has become more important than chasing potential returns from discounted stocks, they said. This was especially true for companies with poor governance and limited disclosures. “There are a number of shares on the JSE that are worth three to four times their current price but we forgo them. The risk is just too high for us. Although we can build a case for those shares doubling, we think they can also easily halve,” said Coronation’s chief investment officer, Karl ...

BL Premium

This article is reserved for our subscribers.

A subscription helps you enjoy the best of our business content every day along with benefits such as exclusive Financial Times articles, Morningstar financial data, and digital access to the Sunday Times and Times Select.

Already subscribed? Simply sign in below.



Questions or problems? Email helpdesk@businesslive.co.za or call 0860 52 52 00.