ANALYSE THIS: Old Mutual’s Pieter Hundersmarck
We analyse Pieter Hundersmarck, manager of Old Mutual Titan Global Equity Fund at Old Mutual Investment Group
If someone came to you tomorrow with R100m to invest in just one company, which would it be?
Whatever the amount, it’s crucial to know whether the person is interested in investing over the long term. If so, my choice would be a company that is financially strong enough to weather the vagaries of the global economy. It should have prospects that allow it to grow revenue and earnings ahead of the market and a price that provides a margin of safety when taking a long-term view. Today, it would be Heineken NV.
If you could turn back time, what would you change in your life?
The lucky few get to find their passion early in life, so I would have liked to start investing sooner. I also would have spent more time learning languages: language is a key barrier to truly understanding another culture, in my view.
What’s the best investment you’ve made?
I put myself through my final years of university and finished my master’s degree with the help of a scholarship and a bank loan. Investing in my education has been by far the best investment I’ve made.
What is your greatest extravagance?
Travelling, fine wine and property investments.
What was your most recent purchase?
A plane ticket to London.
If you found a lottery ticket tomorrow that had won US$100m, what would you do?
I would do the top three items on my bucket list, buy Wimbledon finals tickets for myself and my wife to see Roger Federer play, and take my family and friends on a skiing holiday. The rest I would invest in my fund: Old Mutual Titan Global Equity.
What was your first job?
After retiring at the peak of my waitering career, I enrolled in graduate school. When I’d finished, I worked in mergers and acquisitions for a large Dutch bank. It was an incredibly competitive but highly rewarding environment in which to work. I learnt a lot about myself and particularly about how I operate under pressure (as well as how many weekends I could sit behind my desk ... quite a few, it turns out).
How much was your first pay cheque, and what did you do with it?
I earned €2,800/month (R14,700 in today’s terms) when I was 25. For the first year I spent it on rent and travel. I received my first bonus that year — I think it was €9,000 (R133,000) — of which nearly all went to my student loan. The balance went to two pairs of hopelessly expensive Italian shoes. I still have one pair, looking far more modest 13 years later.
On what occasion do you lie?
To be kind.
What’s your favourite song?
At present my favourites are George Ezra, Andrew Belle and The War on Drugs. One constant would be Paul Simon’s music, and if I had to choose one song it would be "The Boxer".
What’s the worst investment you’ve ever made?
The Russian and Chinese stock markets provided a wealth of learning opportunities for me when I started my investment career. I would single out Gazprom, a large state utility in Russia, as offering a big lesson (that of multiple compression) — one from which I still draw today.
Name a place you’ve been to that lives up to the hype.
If you could fix one thing in SA today, what would it be?
Steering clear of the obvious problems pertaining to education and corruption, I would institute flexible labour laws. Small and medium-sized enterprises are the engine of the economy and they struggle under the weight of labour regulation. I would also reduce exchange-rate restrictions.
Do you own bitcoin? And why?
I am intrigued by ethereum, but I don’t own any. I see cryptocurrencies as replicable in their current form, and they are thus far too speculative to attract me.