Navigating the future: The imperative of active management in a dynamic investment landscape

By Natasha Narsingh, CEO of Sanlam Investments Active Manager

In the realm of investment, it’s often said that the only constant is change and further, the increasing rate of change. My journey over the last two decades as an investment professional has imbued me with a profound appreciation for the ever-evolving landscape of asset management. Today, as the CEO of Sanlam Investments Active Manager, I am excited to share the importance of active management, not just for our business but for investors and the broader market.

Sanlam Investments’ active management business is a significant entity entrusted with over R300 billion in client assets, supported by a team of exceptional investment professionals. This formidable foundation offers us an unparalleled opportunity to deliver value to our clients. It’s a responsibility I do not take lightly, given my extensive background managing portfolios and the strong relationships I’ve cultivated within Sanlam Investments.

But what makes active management so essential in today’s dynamic financial landscape? Let’s delve into the reasons behind its significance. Active asset management serves as the backbone of our investment strategy, founded on the principles of pragmatic value investing. We understand that markets are inherently inefficient, influenced by emotions, and prone to cycles. By diligently tracking historical data and conducting thorough research, we hone our ability to identify investment opportunities that transcend short-term market noise or fluctuations.

Our core principles include a strong emphasis on track records, understanding a company’s history, and comprehensive research. We have dedicated teams for equity research, fixed income research, multi-asset allocation, and economics, bolstered by data analytics to uncover unique investment opportunities. This blend is a potent weapon in our arsenal, enabling us to stay ahead of market trends and add value for our clients.

Our commitment to active management extends beyond profit. We play a pivotal role in promoting good practices and sustainability in the markets we operate in. By actively supporting companies that align with our values and engaging with those that do not, we contribute to a more responsible and accountable investment landscape.

On a global scale, we’ve witnessed a surge in merger and acquisition (M&A) activity among asset management companies. These developments are driven by the challenging operating environment, decreased inflows, and intensified cost and fee pressures. Staying viable in such an environment requires achieving significant scale. In our local market, South African managers face the additional hurdle of regulatory changes allowing for greater offshore exposure, pitting us against international managers vying for the same investor allocations.

In light of these challenges, our recent integration with ABSA Asset Management has endowed us with a critical increase in scale necessary to navigate these turbulent waters. This newfound scale allows us to dedicate substantial resources to managing our clients’ portfolios while maintaining a sustainable business, even amid the tough market conditions.

Looking ahead, we will continue to focus on seeking the best opportunities to meet the investment needs of our clients. The consolidation of Sanlam Investments and ABSA funds onto our platform is well underway, with the launch of the new fund range on the horizon. We’ve also welcomed remarkable talent into our organisation through this integration, and my primary objective is to ensure our teams are optimally positioned and supported to deliver the best possible investment outcomes for our clients.

At the helm of our active management business, I am confident that we have the necessary skills, experience and understanding of the markets within our team, and this – together with our newfound scale and capabilities – will enable us to seize the investment opportunities that lie ahead. In a constantly changing world, active management remains not just a financial strategy but a guiding principle that enables us to navigate uncharted waters and deliver exceptional value to our clients and stakeholders. We are relentlessly committed to ensuring that those who entrust us with their investments are rewarded for doing so.

To learn more about active management and gain deeper insights, watch the recording of our third ‘Inside Our Active Manager’ webinar, hosted on 23 October, where we shared key insights from our business executives and expert investment teams.

Disclaimer:

Sanlam Investments consists of the following authorised Financial Services Providers: Sanlam Investment Management (Pty) Ltd (“SIM”), Sanlam Multi Manager International (Pty) Ltd (“SMMI”), Satrix Managers (RF) (Pty) Ltd, Graviton Wealth Management (Pty) Ltd (“GWM”), Graviton Financial Partners (Pty) Ltd (“GFP”), Satrix Investments (Pty) Ltd, Amplify Investment Partners (Pty) Ltd (“Amplify”), Sanlam Africa Real Estate Advisor Pty Ltd (“SAREA”), Simeka Wealth (Pty) Ltd, Absa Asset Management (Pty) Ltd (“ABAM”) and Absa Alternative Asset Management (Pty) Ltd (“AAM”); and has the following approved Management Companies under the Collective Investment Schemes Control Act: Sanlam Collective Investments (RF) (Pty) Ltd (“SCI”), Satrix Managers (RF) (Pty) Ltd (“Satrix”) and Absa Fund Managers (RF) (Pty) Ltd. Sanlam is a full member of ASISA. Please note that past performances are not necessarily an accurate determination of future performances, and that the value of investments/collective investment units/unit trusts may go down as well as up.

Although all reasonable steps have been taken to ensure the information in this document is accurate, Sanlam Investment Management (Pty) Ltd does not accept any responsibility for any claim, damages, loss or expense, however it arises, out of or in connection with the information in this document. No member of Sanlam gives any representation, warranty or undertaking, nor accepts any responsibility or liability as to the accuracy of any of this information. This document is intended for information purposes only and the information in it does not constitute financial advice as contemplated in terms of the FAIS Act. Use or rely on this information at your own risk. Independent professional financial advice should always be sought before making an investment decision. Past performance is not a guide to future performance. Changes in currency rates of exchange may cause the value of your investment to fluctuate. The value of investments and income may vary and are not guaranteed.