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And the most nonsensical Raging Bull Award goes to …

The black asset manager of the year.
Black asset managers, like black filmmakers, don't want recognition because they are black. They want recognition because they are good. Picture: Shutterstock

The Raging Bull Awards market themselves as the ‘Oscars of the unit trust industry’. They are meant to recognise “the top performers across a range of sectors” by highlighting the funds and asset managers that have delivered industry-leading returns for clients.

The single standard on which this idea is based is excellence. Funds in each category with the highest return over the past three years, or the best risk-adjusted return over the last five years, win awards.

The Raging Bulls also recognise the top-performing asset managers. Those firms with the best overall performance across their suite of funds are in line to be named the asset manager of the year.

Which is why the announcement at the awards ceremony on Wednesday that there would be a special award for the ‘black asset manager of the year’ was met with many a creased brow. This was not just because the award was not on the programme. Many in the audience were left wondering how an award limited to asset managers of a certain race fits with the purpose of the Raging Bulls.

The rationale

Independent Media’s Personal Finance publication, which hosts the awards, explained that the idea for the award came from chairman Iqbal Survé “as a way of recognising black-owned management companies, with the aim of promoting diversity and transformation in the investment industry. The award should have been included on the programme, but was accidentally omitted.”

The inaugural award was in fact made last year to Vunani Fund Managers. However, this award did not appear on the Raging Bulls’ official website, nor did it appear on the full list of winners sent to Moneyweb last year.

These may all be mistaken omissions, but there is a real lack of clarity as to why it exists. Why are black managers being viewed separately?

The competition

To be eligible, Personal Finance explained, firms had to be 51% black-owned as defined by the BEE.conomics survey published by 27Four Investment Managers. This survey provides an annual review of the state of transformation of the industry.

However, the overwhelming consensus among the asset managers Moneyweb spoke to at the awards is that carving out an award for black managers is questionable. The primary concern is that it implies that black managers are unable to compete with everybody else, and so they need a special category where they can compete.

This is clearly in nobody’s best interest. The way for black asset managers to get the recognition that many of them fully deserve is for them to compete with, and outperform, their peers. And there is no question that this is happening.

Kagiso Asset Management, which won the award, had already received two category awards. The Kagiso Stable Fund was the top-performing South African multi-asset low equity fund over the past three years, and the Kagiso Protector Fund was the top-performing South African multi-asset medium equity fund.

Over the last three years, there have also been a number of other black-owned firms that have won categories at the Raging Bulls. Mazi Capital and 27Four have been repeat winners, while Oasis Asset Management and Pan African Asset Management have also featured.

There is therefore obviously no need for these managers to be measured only against each other. While any kind of recognition is hard to disregard, and it may help investors who are specifically looking for empowered managers, it’s not the goal of these companies to be the best black manager in the country. Rather, they aim to be the best managers of any kind.

“We are honoured to receive the black manager of the year award along with the awards for the Kagiso Protector Fund and the Kagiso Stable Fund,” Kagiso told Moneyweb. “We aspire to win the Raging Bull South African manager of the year award which recognises the best manager overall. For some investors, it may be important to invest in a top performing asset manager who also has a Level 1 BBEEE accreditation.”

No sense

An argument might be made that giving recognition to black asset managers may also give them more leverage when it comes to retaining talent, which has been a challenge for many of them. However, it’s debatable whether this award will really hold much attraction.

“It just makes no sense,” says Fatima Vawda, MD of 27Four and one of the most prominent advocates for transformation in the asset management industry. “Excellence has no colour. Who wants to be winning an award based on race?”

She argues that this is particularly the case since the Raging Bull Awards are an industry-wide initiative. They are not run by an organisation purely focused on black business. This makes them very different to the Association of Black Securities and Investment Professionals (ABSIP) Financial Services Sector Awards, for instance, which are specifically targeted towards recognising firms for their transformational achievements.

To use the Raging Bulls’ own analogy, it would be bizarre if the Oscars introduced an award for the best black picture of the year or the best black director. Despite the problems Hollywood has had and the pressures it has faced to be more inclusive, separating awards based on race would be counterproductive.

Black asset managers and black filmmakers alike don’t want recognition because they are black. They want recognition because they are good.

And as Vawda points out, transformation in the industry will not be achieved purely by growing new black managers. It has to be on a much larger scale than that.

“Meaningful transformation is not only about creating independents that are black-owned but about normalisation across the industry where every participant reflects the demographic composition of our country,” she says. “Transformation is also not only about being transformed but about being transformative, meaning that the products and services we introduce to the consumer promote financial inclusivity, something that has been missing in our savings and investments industry. So rather have an award category for a product that has demonstrated its appropriateness for meeting the savings needs of the majority of black South Africans.”

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COMMENTS   27

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The PIC onquiry is bringing the dealings of Iqbal into the spotlight.
While a best black asset manager may be unwanted and puzzling to everyone else it will score numerous fawny points for Iqbal with the ANC, whose protection he is likely to need if the inquiry continues.
Would be my theory.

Just keep separating the white and black people and keep your racism beliefs alive.South Africa you keep showing your 3rd world status.

What this is saying that they cannot compete in the open market so will get awards for mediocrity.

Iqbal Survé? *spits*

More like Icky-balls Served. And, hopefully, Icky balls Serving time in jail.

“as a way of recognising black-owned management companies”
Why always make a racial issue out of everything???
Anything with a racial connotation to it should cast out.
People and companies should be judged on MERIT, not COLOUR.

If “chairman” Iqbal Survé reads my post, I challenge you to drop this idea, purely because it is based on racist principles.

Why not then just call ithe awards — ‘white asset manager of the year’ and ‘black asset manager of the year’??
Oh, sorry, that’s not pc
Personal Finance-as a long time subscriber I strongly suggest you disassociate yourself from this cr%p. I thought you were above this sort of thing or was it just ‘the chairman says…?
New SA…..???

Next step is to have an award for the best star sign…it’s about as relevant. PS Aquarians will win #justsaying

This is so embarrassing.

SA is going nowhere fast.

Other than the asset management industry, who gives a toss about these so called awards?
The whole thing should be shut down as a complete waste of time and money!

Might as well read “award for best performance…for a black person”

And the award for the best CEO in a Soap Opera goes to…… Iqbal Survé

This article misses the real point. Given all the research that shows that investment managers demonstrate practically zero skill (the ability to reliably beat the market), and that investment success over any period depends almost entirely on the factors that happen to be favored by the market over the period, and on luck, it just makes no logical sense to have these awards.

And that the investment industry (made up mainly of smart people who understand this) plays along is just embarrassing. Raging BS, more like it.

CV63 would you agree that ignorance, fake news and narratives are causing an immense amount of damage world wide? Your ignorance and pushing of the narrative that asset managers add no value is exactly that. Please go have a beer and start thinking about this logically. Due to costs (trading, taxes NOT asset manager fees) it is mathematically impossible for the collective asset manager group to outperform the market YET the ignorant expects them to. Some asset managers do in fact outperform the market at the expense of others that don’t. Which is perfectly normal and expected BUT as a group asset managers won’t and can’t. The Raging Bull awards at least attempts at telling you who adds value. Another very important role that asset managers perform is to price assets. Without these nerds competing with each other to add alpha a fair/market price for a stock is determined (in doing so incurring costs NOT fees). Warren Buffett and his generation had the benefit of having a much larger opportunity to buy quality shares at cheap prices 30-50 years ago. Today with information at our fingertips and an army of analysts, asset managers have done a fairly good job at pricing assets better (ever wondered why the value investing style is struggling). ETFs are now busy competing with asset managers on fees. This is great for the consumer, those Asset Managers that always underperforms will fail and make it even more difficult for the good Asset Managers to create alpha because historic alpha came at their expense. A healthy dynamic for the consumer

I’ll skip the beer because you seem to have had enough for two already. Where do I say fund managers add no value? I said the evidence shows they lack skill. Of course, fund managers will outperform from time to time, but no fund manager reliably outperforms (adds value), and none will ever guarantee their outperformance. And if no skill is apparent, then to honour those that happen to come out on top over any period (and someone has to come out on top, by hook or by crook) just makes no sense. Because if you are not rewarding skill, what are you rewarding?

Rubbish. Who or what do you think the “market” is but an reflection of the views of all asset managers? How do you think the market will price itself without any asset managers – and do not give me some tosh about AI – AI is still active management, just done by computers.

I am really so fed up with this populist rubbish that asset managers/banks/insurance adds no value and are just there to rip people off. Natioanlise them all and let the goverment run them then I would love to see the results

Thank you for endorsing my argument. Of course, active management is necessary for price discovery and market efficiency. But you will agree (you must, based on your comment) that no one manager can consistently outsmart the collective wisdom of all other managers. So for everyone to pay for active management is stupid. We need a relatively small element of active management to keep markets price efficient (90% less than we have now should do the trick) and for everyone else – esp. long term investors – to just go along for the ride, earning the market return at low cost. Let the people who knowingly want to gamble their money on active management – and they are always those people – pay for price discovery. If they outperform, they will be rewarded, and if not, they well knew the risk they took.

Have you tested your claim that no fund manager reliably outperforms. Over the 30 odd years that Allan Gray has managed money, do you think they outperformed or underperformed the market consistently. As for skill, firstly skill is subjective. Does the winner of sport get rewarded for their skill or for their score. Does anyone in this world get rewarded for effort or for results. How on earth does one measure skill but not by results as proxy. As for results there are many Asset Managers that have consistently outperformed. Those that didn’t you have forgotten about because they have been closed down….there are many

AG has neither underperformed or outperformed the market consistently over the last 30 years. They may well have outperformed the market over the last 30 years, and if you told the world they would do that 30 years ago that would have been very valuable. So to make a point by highlighting a winner with the benefit of hindsight is not making a point at all. And no, skill is not subjective here, it is very objective. If I can get the market return at low cost with an index fund, and no fund manger can reliably beat the market, net of costs, then they do not have the skill that we are taking about here.

Ad you really need to stop rambling on because you are saying a lot of stuff that is either irrelevant (your sports analogy) or disapproves your argument (such as confirming the surviorship bias when evaluating active management).

“So rather have an award category for a product that has demonstrated its appropriateness for meeting the savings needs of the majority of black South Africans.” This is the best statement I have ever head within the financial services industry. Financial Inclusiveness is very important. Tailoring a financial product around this is what many financial institutions have not actually achieved.

Having a category exclusive for black asset managers is demeaning. This is the same as what Springbok Captain Siya Kolisi said about racial quotas in rugby. Black people should be chosen on competence, talent skills and not because of their skin colour. We need to be all in one category and compete accordingly.

Other than the racist undertones highlighted above I also get a “hey you’re probably not competent enough to punch with the other fund managers, so we’re going to put you in your own league just to make sure you do walk away with a prize” kinda vibe being sent from the Awards to black asset managers

100% is almost a bit like the good attendance award at the school prizegiving. If I was Vunani I would tell them where they can put their award

The Raging Bull Awards are already a load of rubbish because they also reward fund managers for producing NEGATIVE returns in bad markets – as long as you outperformed your benchmark, you’re in the running – so if the benchmark produced – 10% and your fund produced -6% you could be the proud recipient of an award – for losing investors money!!! If I was at this function and they made THIS announcement I would have left immediately – in fact if Elvis was alive (and I’m not saying he ISN’T), Elvis would have “left the building”as well.

It won’t baffle you because clearly you lack the last B

There is a narrative out there that Asset Managers don’t add any value. A very simple calc on Morningstar data will show the following interesting FACTS. Over the last 5 years if one do a weighted average calc on the LARGEST 10 General Equity funds it returned on average 5.27% per annum AFTER all costs and fees. The 3 Index funds that mimic the market being Satrix ALSI index, Sygnia SWIX index and Stanlib Index gave you 4.66%, 5.15% and 3.95% respectively. Over the last 3 years. The 10 largest funds on average returned 3.34% vs 3.19%, 2.77% and 1.56%. I used the 10 largest general equity unit trust because they represent almost 50% of the AUM in this category. I challenge anyone out there to make an argument based on FACT not NARRATIVE that Asset Managers blatantly don’t add value. I simply picked the largest ten unit trusts, not picking the 10 best performing unit trust which one would think belong to the smaller asset managers.

Pathetic to say the least.

And the best looter award goes to the ANC

End of comments.

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