A true maverick in the field of finance, David Shapiro is an outspoken individual who leaves an ingrained mark wherever he goes. Spend a few moments with this sharp minded, witty individual, and you are left with stories that linger in your mind. David Shapiro has over the years built his brand across communities, stakeholders, and clients.
As a recent recipient of the Social Impact award bestowed by the SAICA Chairman's #DifferenceMakers awards, David shares what makes him a #DifferenceMaker in a quick Q&A with Sasfin Wealth’s Head of Marketing, Cobus du Preez.
What makes you a #DifferenceMaker?
As you pointed out, I featured on the cover on ASA in June 2022, in a comprehensive article that celebrated my 50 years on the JSE. The story highlighted my down-to-earth approach to investing, but also pointed out the immense changes I have lived through in my working life, both economically and politically.
On the JSE we moved from an open outcry system to transacting electronically, while politically the country witnessed the transition from the oppression of apartheid to the election of a fully democratic government.
The article also featured my love of sport and art. I played first team football for Wits and was voted Accountancy Footballer of the Year in 1970. My caricatures appeared in numerous local newspapers and magazines, and in 1982 I held a one-man exhibition of my drawings at the Goodman Gallery.
After many years of being involved on the institutional side of the stockbroking business and having held numerous executive positions, including a 5-year stint on the JSE committee, I stepped down to focus on the side of the business I liked the most - managing client portfolios.
Today, I look after large sums of private wealth on a discretionary basis. I am a great admirer of Warren Buffett and closely follow his unpretentious investment approach.
I am also a member of the Sasol Pension Fund investment committee. The pension fund manages assets of around R70bn.
How do you make a difference in society?
When the JSE deregulated and large foreign institutions and trading funds began to dominate trade, overwhelming private investors, I made it a mission to demystify the complex new markets and help ordinary people feel comfortable enough to make their own investment decisions or at least understand what their advisors were proposing. I found that many savers had little idea what the investments they had bought represented and how these convoluted securities had performed.
The channels through which I chose to educate investors was through appearances on business radio, business television, podcasts, seminars and articles.
At present I write regular articles for Business Day, talk at numerous seminars and workshops, do three podcasts a week with Strictly Business, two TV programmes with Business Day TV, a radio show with SAFM, and ad hoc appearances on eNCA and Radio 702.
Tell us how you are innovative and how you do things differently in your industry?
During my many years in financial markets I have been responsible for introducing several innovative products. In the 1980s, when interest rates exploded, I exploited a gap in the market between the rates that banks were offering wholesale investors (anything above R100k – it was the 1980s!) and retail investors. With the approval of the Reserve Bank, we were able to agglomerate our clients’ funds, invest the lump sum with a large bank at the higher rate, and pass on the advantage to our customers. The client deposits that we accumulated allowed us to successfully apply for a banking licence in the 1990s (the first stockbroker to do so), although we were never able to implement our strategy, having been bought out by a large French bank.
When President Mbeki announced a huge infrastructure programme in 2005 to support the needs of hosting the FIFA World Cup in 2010, I created a unit trust called the Twenty Ten Fund to invest in the businesses that would benefit from the spending. The fund, although it changed its nature and direction over the years, won me three Raging Bulls between 2012 and 2014.
When the government began easing exchange controls for individuals in 2010, I recognised the opportunity that the wide range of securities on foreign markets could offer local clients. I used the maxim “Why buy at a spaza when you could shop at a supermarket” to attract clients to the appeal of international markets. Today, most of my business is conducted offshore.
Three years ago, during lockdown, I started the Cristal Challenge, a competition in which participants had to choose five stocks that they had to hold for a year. The winning portfolios would receive a bottle of Louis Roederer’s premium champagne Cristal. In an industry that was being swamped by the large institutions pushing home-grown investment products, my aim was to highlight the fun and benefits of individual share ownership. Unequivocally that one learns more about an economy and business conditions from analysing company reports than from studying macro reports.
The competition is in its third year and has 203 participants - we had to limit numbers for administrative reasons - that include airline pilots, musicians, schoolteachers and palates instructors. We have also attracted several well-known professionals. One of the great benefits of this competition is that we have created a Twitter community around the competition where people constantly share views on the market and exchange ideas on individual stocks.
How do you influence and lead others?
I maintain a very disciplined lifestyle. I wake up 04h45 and turn on the TV to see how Asian markets trading are. After which I usually go for a run. I am at my desk at 08h00 to supervise the firm’s daily investment meeting. I watch all the major markets carefully throughout the day and try go through as many corporate earnings reports as possible. I never go to bed without checking the US close.
The reason is that you cannot look after other people’s savings without knowing what’s happening in the world, politically and economically. You must lead by example and be able to defend and support your views to clients and colleagues.
Tell us how you use partnerships and how you collaborate with others to solve problems?
I never hold my views close to my chest. In conversations, meetings and during media appearances, I always share what I am thinking with my audience in the hope of attracting either supportive or opposite opinions. The discussions, debates and arguments help refine your strategy. Never let your ego get in the way of a discussion. Always admit when you get things wrong.
How do you as a professional demonstrate ethical behaviour in your work?
In our line of work, reputation is your most valuable possession. You can be smart, energetic, innovative, and creative, but without trust and standing you will never build a following. In my article in the ASA, I listed a series of simple pointers I follow that help me gain a client’s confidence.
Follow the link for more information about the SAICA Chairman’s Difference Makers Awards | SAICA