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Star selector: Victoria Reuvers

In the next interview in our series of discussions with leading local fund selectors about their reflections on 2020, we speak to the MD at Morningstar Investment Management South Africa.

Star selector: Victoria Reuvers

 

Victoria Reuvers - Managing Director at Morningstar Investment Management South Africa

Given everything that markets have experienced in 2020, what lesson stands out most?

Don’t bargain on uncorrelated assets in times of stress. The synchronised drawdown of equities and bonds during March was a great example of this and caught many investors by surprise. 

What is the most important asset allocation decision you made this year?

We have been active in our asset allocation, which has been the biggest contributor to performance. The most beneficial decisions include holding protected equity in the portfolios at the beginning of the year and then increasing equity exposure towards the end of March.

Our portfolios have also been at the maximum allowance to offshore exposure and, within our SA equity carve-out, we have had a healthy allocation to resources.

Did you allocate to new managers in 2020, and why or why not?

Yes, two managers in particular. Protected equity that we held in portfolios going into the sell-off and have continued to hold via the Methodical BCI Equity Preserver and Aylett Prescient Equity, who we introduced in March to increase our equity exposure across the portfolios. This is through a manager who is focused on quality, free cash flow and strong balance sheets.

What is the most valuable discussion you had with an asset manager during this period?

Do not underestimate the ability of global financial markets to recover quickly through the significant increase in money supply and monetary policy interventions by central banks.

What has been the most important attribute for fund managers to display in 2020

Consistent application of their investment processes and good communication.  In addition to this, the ability to incorporate new information quickly and adjust portfolios accordingly.

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