WEALTH WATCH
STEPHEN CRANSTON: Competition offered by smart beta products is on the rise in SA
Technology will make for more enticing hybrids in the small passive-investment segment
Johny Lambridis, a portfolio manager at Prudential Investment Managers, has so far come up with the only coherent argument in favour of active asset management. He was very helpful to me when he was an insurance analyst, helping me understand the often complex Old Mutual takeover of Skandia about a decade ago. We have repeatedly heard the argument for index-based investments from noisier folk such as Steven Nathan, head of 10X Investments. He argues that following active managers is like waiting for a rabbit to come out of the hat — after 40 years, you will realise it will never happen. There has been more talk than action about index funds, which still account for 1% or 2% of total assets, particularly when passive products used in-house at Old Mutual and other life offices are excluded.Prudential has credibility as it is a humble group of people without the arrogance of some of the other large houses. And in its quiet way, it has pulled some rabbits out of the hat over the past ab...
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