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Outgoing Satrix CEO: Passive investing was considered a joke, but no longer

Helena Conradie believes the fund manager’s recent awards highlight the fact that investors cannot ignore passive investing.
Helena Conradie says the idea that an investor could have both passive and active investments in their portfolio was a tipping point. Image: Moneyweb

When Helena Conradie joined Satrix in 2000, she found that some investors still viewed passive asset management as ‘a joke’. Today, however, that is certainly no longer the case.

In March, Morningstar named Satrix as the best fund house in its 2021 South Africa Fund Awards. This was the first time that one of the overall awards in that competition went to a passive manager.

‘The Morningstar award means people cannot ignore passive investing,’ Conradie told Citywire South Africa in an interview this week, following the news that she would be leaving her CEO position at the end of October.

Growth

When Conradie joined Satrix in January 2000, the fund manager had just R800 million in institutional money in its book. In November 2000, Satrix launched its first exchange-traded fund (ETF), the Satrix 40 ETF.

In 2013, the passive fund manager had grown to have R34 billion in assets under management and seven JSE-listed ETFs. Conradie took over as Satrix CEO in November 2013. Today, Satrix has R135 billion in assets and 20 JSE-listed ETFs.

‘Satrix has moved from the Satrix 40 ETF to a book of institutional, retail and direct clients. It is a hugely diverse business. I was involved in Satrix from the get-go. We went through a stage where investors ignored Satrix. We were last on the agenda, and sometimes we even fell off the agenda.’

‘A bit of a joke’

Over the past 21 years, she said that passive investing had moved from ‘a bit of a joke’ to something that investors and asset managers could not ignore.

‘When I started in 2000 in passive management, it was something people probably didn’t even give attention to. They never thought it was important.

‘Active asset management played a huge role. There were lots of personalities in the market. Fees were not important at that stage as returns were higher,’ Conradie said.

The idea that an investor can have both passive and active investments in their portfolio was a significant tipping point for local passive investments, she added.

Conradie said South African investors started to realise that active and passive investments could work together in 2010 when an international indexing conference took place in South Africa.

‘In 2010, one of my presentations covered core and satellite portfolio construction – the combination of active and passive. Now it is mainstream to speak about core and satellite portfolio construction.’

Reason for departure?

Conradie said that she was happy to be leaving the business in ‘an excellent position’.

‘I’m extremely passionate about the business. I will always have Satrix in my blood,’ she said.

‘Over the years, I have seen many unhappy departures. I probably wanted a happy departure. It is absolutely a decision I have probably thought about for the last few years. When do you say you are going to hand over to someone?

‘Probably the final point of decision for me was for Satrix’s 20th birthday. We went through quite a nostalgic period. You get to the point where you say, wow, I have spent part of my lifetime at Satrix. That was the last part of the domino effect,’ Conradie said.

She said the fact that COO Jenny Albrecht is leaving Satrix at more or less the same time is pure coincidence.

‘She has been at Sanlam for 24 years and Satrix for 17 years. We have worked well together as a CEO and COO combination. It is that time for both of us.’

Overcoming a male-dominated environment

On a personal level, Conradie said that a challenge she faced working in the asset management industry was being a woman in a male-dominated environment.

‘It will always be a challenge. I think you bring diverse thinking and so many things to the party.’

Conradie said she would love to take a break for six months or so.

‘Someone told me last week that you need to take a break from being responsible for so many things.

‘There are photo frames in my house that do not have photos in them. I want to be a person for a bit,’ she said.

‘I’m so interested and invested in the asset management industry that I won’t be able to switch off completely. I will resurface. Satrix took up all of my mind. I had no space for anything else. So, this is about taking a break and thinking about my future,’ Conradie said.

‘But there are so many exciting things happening in the industry. I’m at this stage of my career where you want to plough back and make a difference. I want to continue doing things that matter. I have not decided on what yet.’

This article was first published on Citywire South Africa here, and republished with permission.

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Well done Helena and Jenny. Go girls go ! All the best for your futures !
Thanks for your dedication and hard work.

Thank you Helena. You have made South Africa a better and wealthier place!

Legendary… shows that those actively managed funds are a complete waste of time

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