STEPHEN CRANSTON: Conducting an investment orchestra
The asset consulting industry is severely compromised. It is now a sales channel
Multimanagers can help take a lot of stress away from investors. They can pick a selection of specialist managers to run a portfolio. The argument used by one of the pioneers of the sector, Frank Russell, was that specialist sprinters or shot putters will always do better in their chosen field than a generalist taking part in a decathlon. But then choosing the right specialists is only the start of the process. To change the metaphor, a multimanager also has to conduct the orchestra. In the early days multimanagers kept out of the asset allocation game, but it became unacceptable to stand by and watch value being destroyed at moments such as the height of the global financial crisis. The performance of multimanagers is best followed in the Alexander Forbes Manager Watch. Forbes is the largest player in the sector, with R312bn under management, but it isn’t given any preferential treatment. Its Performer portfolio is still by far the largest fund in the sector, and the simplest from ...
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