RE:CM scoops two raging bulls awards

Value based asset manager, RE:CM has seen two of its funds win top honours at the 2013 Raging Bull Awards. Both the RE:CM Global Fund and RE:CM Global Feeder Fund were recognised as top performers within the Risk-Adjusted Performers category. The RE:CM Gl

When ranking the top performers on a risk-adjusted basis, the Raging Bull Awards make use of the PlexCrown system, which incorporates risk-adjusted returns and consistency of performance over five years.

The RE:CM Global Feeder Fund, a Rand denominated fund with an underlying investment in the RE:CM Global Fund, is a global equity fund with specific focus on generating long-term real capital growth with lower than average risk of capital loss and less volatility than the index.

According to Daniel Malan, Investment Director of RE:CM, the fund’s success was achieved by avoiding emerging markets and other fads, which many investors favoured over the recent past. “Key counters that contributed to good performance within the fund include retailer Carrefour, Greek stocks Hellenic Exchanges and Coca Cola Hellenic and Bank of America.”

The Global Feeder Fund has produced returns of 8.3% over a five year period, outperforming the fund’s benchmark, the MSCI World Index in rands, by more than 4%.

“Investing in the RE:CM Global Feeder Fund provides an opportunity for investors who have used up their offshore allowance or prefer to invest in Rands, but who still wish to benefit from offshore exposure via the RE:CM Global Fund.”

Meanwhile, the RE:CM Global Fund has compounded in US dollars at 5.9% per annum (after fees) since inception nearly seven years ago and produced returns of 5.5% over a five year period. This compares favourably with the MSCI World Index benchmark total return of 2.8% over the same period.

On the current investment strategy of the funds, Malan says that following nearly four years of virtually uninterrupted price gains in global assets within the fund, this is an opportune time to stop, observe and attempt to gain some perspective. “The MSCI World Index has doubled from its March 2009 lows. Equities were very cheap then and the Global Fund was fully invested, correctly so with hindsight.

“The past year has seen a slow rotation out of 'defensives' into 'cyclicals', in line with the continued relative outperformance of defensives over cyclicals as global market participants chase what they perceive as the 'safe haven' of yield. We believe this to be an investing mistake of the first order in a macro-environment that artificially keeps interest rates so low. We also observe a slow rotation from US listed businesses to those in Western Europe and Japan. Despite the market indices having doubled, our new idea generation pipeline remains healthy and focused on Western Europe and Japan. If this continues we anticipate remaining fairly fully invested. We believe the diversity and quality of the underlying businesses in the fund represent excellent absolute and relative value,” concludes Malan.