Independent Fund Research and Ratings

Fund research is at the core of our business. We research both South African and International Funds using a qualitative, in-depth due diligence approach. We believe that only a deep understanding of all of the drivers of investment success will allow us to make informed investment decisions and guide clients accordingly. Our investment professionals, all of whom have substantial experience inside asset managers, developed the approach.

Fund managers do not pay us. We believe that, by placing the long term needs of our clients ahead of our short-term business needs, we will enhance our integrity and build lasting relationships with our customers. It means we are able to offer candid opinions and guide clients with clarity.

When researching and rating a fund, we look at a range of factors such as: the business structure within which the fund operates; the fund management team, their beliefs and principles when making decisions; team dynamics and culture; as well as evidence of consistency in the investment process. This approach offers the highest degree of comfort that the fund is being managed appropriately.

This holistic research process informs our investment advisory service and clients also use our ratings as an independent guide to make their own investment decisions.

Our industry experience and qualitative fund research positions us as an expert support provider to:

  • Fund platforms: fund selection, ratings and IFA support
  • Multimanagers: fund research to complement inhouse teams
  • Pension funds/Umbrella funds: independent fund advisory
  • Independent Financial Advisers: independent fund and portfolio advisory

About Fund Ratings

We rate each fund researched based on our three Rating levels:
This is our top rating. We are satisfied that this offering is managed according to a well-considered process, applied consistently and supported by the business.
This is a good fund, however we have some minor concerns which may be people, process or business related.
This is a negative rating. We have one or more fundamental concerns about aspects of this fund and believe there are better alternatives.

How we select funds to rate:

We aim to rate funds which are in the best interest of our clients. Our research is largely client driven but we conduct an ongoing market assessment to see if there are additional funds which we need to cover.
Currently we cover:
  • South African and Offshore domiciled funds
  • Single asset class and Multi-asset class funds
  • Active and Passive funds
  • Funds from large institutions as well as smaller boutiques

What we evaluate

The Rating Process

We cover each fund comprehensively by following the steps below.
We generally spend between 50 and 100 hours on each fund and the
full rating process can take up to 4 months.

Information Gathering

For each fund we gather supporting information and evidence to be able to evaluate the management of the fund. This includes detailed due diligence questionnaires completed by the fund manager, as well as our own research. We also perform analytical studies on each fund using independent tools, and we evaluate the fund managers' own analysis.

Fund Manager Visit

We interact with, and visit fund managers, to test that the day to day management of the fund is in line with what is expected and documented. We aim to avoid marketing presentations wherever possible, and prefer to drive these sessions through informed questioning. We aim to establish if a fund is credibly managed, how the team works as a unit and various other elements which provide context.

Rating Meeting

Each team member arrives at an independent assessment of the fund. We then debate the rating elements until we have clarity on which Tier Rating should be allocated.

Review Process

All rated funds are monitored on an ongoing basis, and a material change in any aspect of the fund's management - be it business or investment related - will trigger a review. If there are no material changes in the interim, our intention is to formally review all funds we have rated on a 12 to 18 month review cycle.

Fund Manager Feedback

Part of our process is to provide the fund manager with open, transparent feedback of our findings, which allows the fund manager to challenge our findings and forces us to ensure that our views are evidence based as far as possible.

Fund Management Companies Covered