The era of low interest rates and low inflation seems to be behind us, with most investors and governments admitting that inflation is more persistent rather than being of a transitory nature, as was previously put forward. Rising fuel and energy prices, primarily as a result of the war in Ukraine, supply chain disruptions due…
Smithson represents a small carve-out within the equity component of our Dynasty house-view Funds and is our only component focussed on the small and mid-cap sectors. As such, Smithson has a high beta characteristic and will tend to be much more volatile than our other fund components. We trust that you found that the presentation…
Finance Minister Enoch Godongwana delivered his inaugural Budget Speech on 23 February 2022, the content of which has already been widely publicised and digested by different stakeholders. Of greater interest to us were certain Exchange Control amendments announced by the Reserve Bank after this date, which we believe to be of particular relevance to our domestic,…
With international markets facing headwinds in 2022, one would have expected the rand to be on the back foot. After all, rising interest rates in the developed world, growing inflationary pressures, “risk-off” due to the war in Ukraine, and sanctions on Russia would all seem to point to international investors gravitating towards safe haven assets.…
As mentioned in our Market Update, the quarter was characterized by concerns around higher-than-expected inflation, a more hawkish policy response by the US Fed in terms of rate hikes, and the war in Ukraine. How have these factors impacted our portfolio positioning? Dynasty-selected portfolios that are aligned with a quality style investment philosophy, generally underperformed…
Key take-outs compiled by Reder van Rooyen (investment analyst at Dynasty) Metrics used in the investment process: As a precursor, the Fundsmith Equity Fund looks at the following metrics when identifying strong and resilient companies to invest in: Return on Capital Employed (ROCE), gross margins, operating profit margins, cash conversion and interest cover. As…
A consideration expressed by almost all our domestic clients when progressing their wealth externalisation strategies, is around whether the prevailing exchange rate is at an acceptable level for currency conversion purposes. In addressing this issue, we consider many factors including the historic long-term trend line (which empirically illustrates rand depreciation of on average around 5%…
Many of our clients are aware that the Dynasty House-view Funds include a relatively minor weighting to the global small and mid-cap sector via Smithson, a listed UK-listed Investment Trust. In this five-minute video interview, Jill Carey Hall, head of small and mid-cap strategies at Bank of America, explains why stocks in this sector, particularly…
With the consumer price index in the US hitting a four-decade high in December 2021, rising 7% year-on-year, the investment conversation in 2022 will be dominated by persistent inflation and its impact on financial markets. With a collision between pandemic-related supply chain bottlenecks, labour shortages and growing demand, the US Fed is no longer talking…
