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A key growth strategy is for Prescient to penetrate further into the South African retail investor market. This includes rolling out solutions such as unit trusts via Prescient Investment Management, the group’s Wealth and Retirement Solutions and Securities business units.
The Company defines a “retail investor” as anyone who wants to invest or save in his or her personal capacity, outside of formal regulated savings such as pension and provident funds.
The main thrust of this drive is mainly to intermediaries who do the financial planning for clients.
“In the retail space, similar to the process followed with our institutional clients, we need to understand what the market wants,” CEO of Prescient Investment Management, Eldria Fraser, explains.
“Retail clients traditionally have been exposed to portfolio management where investment managers forecast and make calls on the market. Risk management is then primarily achieved through portfolio diversification.
“Our approach is quantitatively driven. Part of our focus is on reducing the downside by physically positioning portfolios to minimise losses. We achieve this by putting a ‘safety net’ in place as it were, to protect capital and avoid the deep drawdown that can occur in markets.” This can be defined as absolute or relative losses, depending on the portfolio.
Head of Retail Sales, Nicky Gous, points out that Prescient’s approach does not equate to it aggressively “selling” its funds to clients, but that it’s rather a case of sharing its philosophy and process. Once it’s embedded, people recognise how sensible it is and go on to realise significant value.
Gous says: “Asset allocation is a big driver of our process, coupled with Prescient’s quantitative process of selecting equities.
“Retail investors benefit from the skills that our investment team has built up during the past 13 years. In fact, our unit trust funds are managed in exactly the same way as our pension fund portfolios.”
Gous acknowledges that some clients might read into this that our approach is complicated, but suggests that it’s probably an overstated view. “Actually, it is straight forward and once they grasp it, they recognise its considerable strengths. Besides, we commit to being ‘partners for life’, underpinned by a strong culture of delivery. That, too, has enormous appeal.”
In a similar vein, Fraser recognises anxieties that occasionally arise out of the notion of Prescient being a ‘quantitative investment manager’. These are usually descriptions of quantitative investment managers as “closet index trackers” or “black box traders”.
“It’s important to emphasise that Prescient conscientiously follows a pragmatic, absolute return approach, which is applied in a quantitative manner,” she says. “It takes emotion out of the decision-making process and allows the facts to be heard. It’s active but not reactive. It’s calm and risks are factored in.”
Prescient’s approach to the retail market is not intended to be a “big bang” event, Gous remarks. “On the contrary, the business has been consolidated and refined from the outset, winning the confidence of those who were bold enough to support us. But only once we were comfortable that the groundwork was in place, did we commence with the expansion of our retail offering.”
Prescient has created a national footprint with a strong service-orientated retail team based in Cape Town, Johannesburg, Pretoria and Durban. These offices allow it to cover Bloemfontein, Rustenburg, Nelspruit and some coastal areas.
“Considerable work is being done to nurture our brand presence, enlightening potential investors on the investment house’s process and setting up operational support structures,” says Gous.
“We’re open-minded, we’re innovative and remarkably agile. We’re not a big bus that takes time to turn. We react quickly, we’re not blinded to criticism, and we’re always open to advice on how to do things better. We’re also very passionate and hardworking.”
Gous points out that the team regularly facilitates meetings, discussions, telecons and podcasts to create footprints.
Even Prescient founder and chairman, Herman Steyn, engages in the roll-out, indicating that he enjoys roadshows immensely for both retail and institutional clients. Much has been done to ensure that Prescient’s unit trusts are available on investment and administration platforms (LISPS). These provide greater efficiency for both investors and clients.
The Company defines a “retail investor” as anyone who wants to invest or save in his or her personal capacity, outside of formal regulated savings such as pension and provident funds.
The main thrust of this drive is mainly to intermediaries who do the financial planning for clients.
“In the retail space, similar to the process followed with our institutional clients, we need to understand what the market wants,” CEO of Prescient Investment Management, Eldria Fraser, explains.
“Retail clients traditionally have been exposed to portfolio management where investment managers forecast and make calls on the market. Risk management is then primarily achieved through portfolio diversification.
“Our approach is quantitatively driven. Part of our focus is on reducing the downside by physically positioning portfolios to minimise losses. We achieve this by putting a ‘safety net’ in place as it were, to protect capital and avoid the deep drawdown that can occur in markets.” This can be defined as absolute or relative losses, depending on the portfolio.
Head of Retail Sales, Nicky Gous, points out that Prescient’s approach does not equate to it aggressively “selling” its funds to clients, but that it’s rather a case of sharing its philosophy and process. Once it’s embedded, people recognise how sensible it is and go on to realise significant value.
Gous says: “Asset allocation is a big driver of our process, coupled with Prescient’s quantitative process of selecting equities.
“Retail investors benefit from the skills that our investment team has built up during the past 13 years. In fact, our unit trust funds are managed in exactly the same way as our pension fund portfolios.”
Gous acknowledges that some clients might read into this that our approach is complicated, but suggests that it’s probably an overstated view. “Actually, it is straight forward and once they grasp it, they recognise its considerable strengths. Besides, we commit to being ‘partners for life’, underpinned by a strong culture of delivery. That, too, has enormous appeal.”
In a similar vein, Fraser recognises anxieties that occasionally arise out of the notion of Prescient being a ‘quantitative investment manager’. These are usually descriptions of quantitative investment managers as “closet index trackers” or “black box traders”.
“It’s important to emphasise that Prescient conscientiously follows a pragmatic, absolute return approach, which is applied in a quantitative manner,” she says. “It takes emotion out of the decision-making process and allows the facts to be heard. It’s active but not reactive. It’s calm and risks are factored in.”
Prescient’s approach to the retail market is not intended to be a “big bang” event, Gous remarks. “On the contrary, the business has been consolidated and refined from the outset, winning the confidence of those who were bold enough to support us. But only once we were comfortable that the groundwork was in place, did we commence with the expansion of our retail offering.”
Prescient has created a national footprint with a strong service-orientated retail team based in Cape Town, Johannesburg, Pretoria and Durban. These offices allow it to cover Bloemfontein, Rustenburg, Nelspruit and some coastal areas.
“Considerable work is being done to nurture our brand presence, enlightening potential investors on the investment house’s process and setting up operational support structures,” says Gous.
“We’re open-minded, we’re innovative and remarkably agile. We’re not a big bus that takes time to turn. We react quickly, we’re not blinded to criticism, and we’re always open to advice on how to do things better. We’re also very passionate and hardworking.”
Gous points out that the team regularly facilitates meetings, discussions, telecons and podcasts to create footprints.
Even Prescient founder and chairman, Herman Steyn, engages in the roll-out, indicating that he enjoys roadshows immensely for both retail and institutional clients. Much has been done to ensure that Prescient’s unit trusts are available on investment and administration platforms (LISPS). These provide greater efficiency for both investors and clients.
