Page 162 - Profile's Unit Trusts & Collective Investments - September 2025

Chapter 9 Fund manager interviews

Regulation 28 compliant fund, we strategically allocate capital across a variety of asset classes
including Local and Global Equities; Local and Global Fixed Income and Listed Property. We
actively seek out high-quality assets with compelling growth prospects, employing our “growth at a
reasonable price” philosophy on a global scale.
Comment on your investment year (July 2024 – June 2025) from a fund manager’s point of view
The Aeon Balanced Prescient Fund’s outperformed its CPI + 5% benchmark over the last 12
months. We were pleased with our strong outperformance in both domestic equities and fixed
income, while we faced headwinds in our global equity stock selection. The underperformance in
global equities was a short-term headwind, with some of our long-term holdings experiencing a
period of underperformance. We remain confident in their underlying fundamentals, and our “growth
at a reasonable price” philosophy prioritises long term value over short term noise.
Our performance in South African markets was exceptional, and our bottom-up stock selection
in local equities delivered strong alpha. Overweight positions in AngloGold PLC, Prosus Ltd, and
Discovery Group Ltd were key contributors to our strong performance. We continue to hold a positive
long term view on these companies. In our fixed income portfolio, our decision to position the fund
with a slightly longer duration than the benchmark proved beneficial.
Within the Global Equity carve-out, our Overweight positions in UniCredit, Natwest and TSMC
were positive contributors while in the short term, quality companies like ASML, Novo Nordisk, and
Nike underperformed. Despite our short term underperformance in global equities, our long term
track record remains strong, with significant alpha generated over extended periods.
In terms of risk management, what methods or strategies are you able to use to protect your
clients’ investments?
We use a multi-faceted approach to protect our clients’ investments, integrating various
systems and methodologies to ensure robust oversight. Our primary goal is to minimise the risk
of underperformance. This approach includes exposure monitoring, advanced risk analytics, and
fundamental portfolio management.
Comment on the year ahead and, if possible, estimate the performance of your fund over 2 or
3 years. What are your targets and objectives for the year ahead?
We are not providing a specific percentage forecast, as our process is focused on fundamental
analysis rather than market timing. However, our objective is to beat our benchmark of CPI + 5% over
the long term. We believe our fund’s core strength lies in its ability to add alpha through disciplined
stock and bond selection, both domestically and globally. This is evidenced by our strong local and
global track record of outperformance over the longer term.
Globally, the picture is one of continued growth. We expect the disinflationary trend to persist,
which should give central banks room to continue with a gradual cycle of interest rate cuts. This
environment is generally supportive of risk assets and plays directly into our “growth at a reasonable
price” philosophy. The focus will remain on high-quality companies with strong earnings and solid
balance sheets that will do well in a more moderate growth environment.
The domestic outlook remains challenging. GDP growth is expected to remain benign. The
formation of the Government of National Unity (GNU) has brought a degree of market confidence, but
its long-term stability and ability to execute critical reforms remain a key concern. While we continue
to find selective opportunities on a bottom-up basis, as evidenced by our strong outperformance in
local equities and fixed income last year, we expect that these will remain company-specific rather
than a broad-based market rally. Therefore, we will maintain a highly selective approach to our local
allocation.
We expect global assets to outperform local assets over the next two to three years, driven by a
more favourable global economic backdrop.

Are equity markets in general overpriced? Do you anticipate a significant correction?
While some sectors of the market may be overvalued, we believe that the market as a whole
is not. Our active, bottom-up approach allows us to find value in certain areas, even as broad
market indices may appear overvalued. We do not anticipate a significant market-wide correction.

160 Profile’s Unit Trusts & Collective Investments September 2025