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Simon’s weekly wrap-up: ESG gains traction

Also, a look at education stocks amid lockdown, Maya Fisher-French on Crowd1, gold and tech stocks, the process of asset sales and more.

The environmental, social and governance (ESG) trend is gathering momentum globally and South Africa now has its first active unit trust with an ESG theme from Old Mutual. I spoke to Elize Botha, MD of Old Mutual Unit Trusts, about the factors, as $30 trillion is now invested globally into ESG-themed funds. She also talks about the evidence that ESG really does result in better returns for a company’s profit and ultimately their share price.

Education has long been a defensive sector to invest in, as parents will cut other parts of a household budget to ensure a top education for their kids. But the Covid-19 pandemic and resulting lockdown has changed that dynamic. I spoke to Anthony Clark on our three listed education stocks (ADvTECH, Curro and Stadio) after he’d attended all three of their annual general meetings. I also asked him which is his preferred stock under the new normal of lockdown, as they struggle with non-payment of fees.

Crowd1 is in the news for all the wrong reasons, as the Financial Sector Conduct Authority has referred it to the South African Reserve Bank Prudential Authority, while the National Consumer Commission is also investigating the company and Namibia has banned their operations in that country. Maya Fisher-French has been digging into the company and its operations and I spoke to her to get a better understanding on the company claims around its business model and whether it looks like a pyramid scheme.

Gold is finally having its day in the sun, as it trades above $1 800 and the gold miners index has broken out of a 20-year consolidation pattern. As the pandemic numbers continue to surge and a full economic recovery is a few years off, this trend is likely to continue. Alex Duys of Umthombo Wealth commented that he’d never really considered gold as an investment but that this is the time for gold miners. His preferred two smaller gold miners are Harmony and DRDGold.

Also this week:

Mia Kruger of Kruger International on surging tech stocks and Warren Buffett buying into energy. Citadel’s Riaan Campbell discusses the process of asset sales as retirement looms. Johann Erasmus of Standard Bank talks about the lender’s commodity exchange-traded notes that expire in August and those expiring next year.

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