Over the long term, equity investments deliver superior returns to investors. For this reason, the portfolio will almost always be invested in equities to the maximum allowable extent (75%), unless we consider equity valuations to be expensive or we need to contain risk.

When evaluating equities, we tend to follow a value investment approach with a preference for high quality companies with the potential to generate stable, consistent returns. The importance of identifying and investing in these companies is to harness the compounding effect on shareholder return.

As we believe that international diversification is important, a substantial portion of our assets will always be invested in offshore equity via investments in our own Worldwide Flexible Fund and other direct offshore holdings. Locally-listed stocks with rand hedge qualities are also important when considering international diversification.

The remaining 25% of the portfolio not allowed in equity is currently mostly invested in listed property stocks. As we have a long term view, we prefer listed property to bonds or cash, as listed property has (like equity) outperformed bonds and cash over the long term.

Over the long term, equity investments deliver superior returns to investors. For this reason, the portfolio will almost always be invested in equities to the maximum allowable extent (75%), unless we consider equity valuations to be expensive or we need to contain risk.

When evaluating equities, we tend to follow a value investment approach with a preference for high quality companies with the potential to generate stable, consistent returns. The importance of identifying and investing in these companies is to harness the compounding effect on shareholder return.

As we believe that international diversification is important, a substantial portion of our assets will always be invested in offshore equity via investments in our own Worldwide Flexible Fund and other direct offshore holdings. Locally-listed stocks with rand hedge qualities are also important when considering international diversification.

The remaining 25% of the portfolio not allowed in equity is currently mostly invested in listed property stocks. As we have a long term view, we prefer listed property to bonds or cash, as listed property has (like equity) outperformed bonds and cash over the long term.

During the quarter we added to our investment in British American Tobacco and it is now one of the funds’ biggest investments. In our opinion investors are over-discounting the challenges the company and the industry as a whole faces and is trading at very attractive levels.

Over the long term, equity investments deliver superior returns to investors. For this reason, the portfolio will almost always be invested in equities to the maximum allowable extent (75%), unless we consider equity valuations to be expensive or we need to contain risk.

When evaluating equities, we tend to follow a value investment approach with a preference for high quality companies with the potential to generate stable, consistent returns. The importance of identifying and investing in these companies is to harness the compounding effect on shareholder return.

As we believe that international diversification is important, a substantial portion of our assets will always be invested in offshore equity via investments in our own Worldwide Flexible Fund and other direct offshore holdings. Locally-listed stocks with rand hedge qualities are also important when considering international diversification.

The remaining 25% of the portfolio not allowed in equity is currently invested in listed property stocks. As we have a long term view, we prefer listed property to bonds or cash, as listed property has (like equity) outperformed bonds and cash over the long term.

Intu Properties is currently our biggest property bet and also one of our top holdings in the overall portfolio. Even though Intu owns some of the best shopping centres in the UK with an occupancy rate close to 100%, it is trading at a 50% discount to its NAV. We believe that this discount is not justifiable as property valuations in the UK should not decrease to the extent that Intu’s discount is reflecting.