PLEXUS and AMABUBESI launch investment management company

Plexus Asset Management has entered into a corporate deal with empowerment company Amabubesi Group to distribute an innovatively managed range of products through a new investment management company, Plexus Fundamental Funds, the Plexus Group announced this week.

Co-owned by Plexus Asset Management and the Amabubesi Group, Plexus Fundamental Funds will offer investment products that are based on a methodology pioneered by Californian investment and research company Research Affiliates. Plexus Asset Management holds the licence from Research Affiliates to manage products in the Pan-African region in line with the enhanced Fundamental Index (eRAFI®) methodology.

According to Dr Prieur du Plessis (pictured right), director of Plexus Fundamental Funds and chairman of the Plexus Group, he is “delighted to have Amabubesi on board”.

“The South African eRAFI® products were launched in August 2007 and have already attracted inflows exceeding R1 billion,” says Du Plessis. “With Amabubesi backing this state-of-the-art investment offering, we can only go from strength to strength.”

Peter Moyo (picured below), director of Amabubesi, says: “We are excited to have the opportunity to work with Plexus. They are entrepreneurial in their thinking and have a business approach similar to that of Amabubesi. We are proud to be partnering with them on an investment offering that we believe has already begun to reshape the investment industry globally and now the industry in South Africa.” 

Amabubesi, a new-generation empowerment group established in 2002, is led by joint founder and CEO Sango Ntsaluba. Its other founding partners, Peter Moyo and Thabiso Tlelai, are also leading businessmen. Unlike in many other empowerment companies, Amabubesi’s founding partners all have proven business track records and continue to be significant shareholders in their group.

As its first product, Plexus Fundamental Funds has created a domestic equity portfolio using the eRAFI® methodology. This is available as a segregated equity portfolio for institutional clients, as well as a collective investment scheme for retail investors under the name Plexus RAFI® Enhanced SA Strategy Fund. Plans are under way to list the portfolio as an exchange-traded fund on the JSE.

The eRAFI® methodology uses fundamental accounting measures of company size, including sales, cash flow, book price and dividends, rather than market capitalisation. It differs from the traditional RAFI® methodology used to calculate the FTSE/JSE RAFI® 40 Index as it incorporates additional factors such as quality of earnings and financial distress. Furthermore, in accordance with the methodology, portfolios are more frequently rebalanced.