Sasfin Wealth Q2 Newsletter

The past quarter has been exceptionally busy from a geo-political perspective, and that includes South Africa. The local elections came and went relatively smoothly barring the minor hiccup associated with alleged double-voting. Though President Cyril Ramaphosa had not yet appointed his Cabinet at the time of writing, the election result certainly strengthened his hand to adhere to his corruption-busting State of the Nation mandate from February.

US President Trump’s continued belligerence regarding the proposed tariff hikes on Chinese imports has not abated. Mike Haworth, Sasfin Wealth’s Investment Strategist, describes the dichotomy whereby the Chinese are actively reforming and transforming their economy – a direct contributor to global growth since 2000, whereas by contrast, the US economy is developing imbalances, which is eroding its output potential growth. The tariffs stand-off has put jitters on both developed and emerging equity markets, as the US has imposed higher trade tariffs on $253bn of Chinese imports, while China has imposed higher tariffs on $110bn of US imports – with dire potential consequences.

US President Trump’s continued belligerence regarding the proposed tariff hikes on Chinese imports has not abated. Mike Haworth, Sasfin Wealth’s Investment Strategist, describes the dichotomy whereby the Chinese are actively reforming and transforming their economy – a direct contributor to global growth since 2000, whereas by contrast, the US economy is developing imbalances, which is eroding its output potential growth. The tariffs stand-off has put jitters on both developed and emerging equity markets, as the US has imposed higher trade tariffs on $253bn of Chinese imports, while China has imposed higher tariffs on $110bn of US imports – with dire potential consequences.

The resultant uncertainty in global equity and bond markets will ensure investors enter the second half of the calendar year somewhat more cautiously than originally intended. Caution and risk management of one’s portfolio is called into question by Andrew Padoa, Portfolio Manager at Sasfin Wealth, who analyses Tiger Woods’ record-breaking US Masters victory in April, and in particular how he applied thorough risk management in the closing stretch of the back nine, as a lesson in diversification and appropriate asset allocation of one’s portfolio.

The prevailing theme in this edition is around the future of global investing – including processes, technologies and strategies to assist investment managers in making the right decisions for their clients. In this regard, we are pleased to feature guest columns from Ian Lessem, Managing Partner at Investment and Advisory firm Havaic, and Paul Slade, CEO of The CRM Team, a leading Johannesburg-based Customer Relationship Management (CRM) and data analytics consultancy.

Our regular Q&A interview features legendary tech journalist and the founding CEO of World Wide Worx, Arthur Goldstuck. Arthur is a the newly appointed Head of the recently founded Sasfin Digital Council, and our wide-ranging interview covers his early foray and experiences into the world of digital, some of his most notable career achievements including the opportunity to recently meet and interview acclaimed founder of Dell Technologies, Michael Dell.

We also cover Sasfin Securities Deputy Chairman, David Shapiro’s well attended presentation, where he unpacked some of the more lesser known global investment trends. David’s message was essentially that as investors, we need to be constantly innovating and identifying new industries and market segments to achieve market-beating returns in a low-growth environment. Some of those industries that he is currently investigating include cloud-computing and live-streaming, gaming and health-tech. In a similar vein, Equity Analyst, Nicholas Dakin, reveals the story behind US-based Pet nutrition behemoth Zoetis. With a market cap nearing $50bn, Zoetis is one of those ‘under the radar’ growth counters that continues to deliver returns to its shareholders as the momentum of US pet care spending endures.

Lastly, as Fintech trends point towards disintermediation and the perceived diminished human role in accessing and consuming financial services, Charleen Rix, Sasfin Wealth’s Head of Healthcare Consulting, bucks this trend and argues cogently why intermediaries in the private Healthcare space should not be viewed as a luxury for those who choose not to avoid ‘going direct’, but rather why the broker is a necessity in a highly complex and commoditised private Healthcare sector that is fraught with ambiguous legislation, and a multitude of products and Healthcare providers that make it near impossible for the consumer to appropriately choose a plan that meets his personal needs, or those of his employees or trustee beneficiaries.

Enjoy the read.

 

 

 

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