STEPHEN CRANSTON: A recovery portfolio?
Investors should be able to cope with depressed returns for a year to 18 months before the turning point, when gains will be at their highest
Stampedes out of funds are not unusual. I can remember the panic-selling of GuardBank (now Stanlib) funds 20 years ago, and old-guard businesses such as Sanlam have seen assets drift down. But the loss of confidence in Foord Asset Management beats any of these. In 2018, Foord Balanced was the single largest loser as R8.9bn was pulled out. It was hardly a red-letter year for rival Coronation either, yet its balanced fund had less than R300m pulled out. Frankly, any investor who pulls out of a balanced fund after a 3.7% loss for the year should be in something a lot more conservative, like an income fund. Yet Coronation clients held steady even though there was a larger loss of 4.1%. The biggest difference between the shops has nothing to do with the finer points of investment: Foord’s marketing remains extremely amateur. Most people can’t relate to its squirrel symbol, It could build so much more capital on the roguish but highly original character of its founder, Dave Foord, while e...
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