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Tuesday, August 1, 2000
Quite frankly

Liberty Multi-Manager is a division within Liberty Collective Investments, a new business unit in the restructured Liberty Group. The division was officially launched in March 2000. It exclusively markets and administers multi-manager funds both domestic and offshore. The division is suited to long-term investors with a prudent approach to investment management.

Currently the RSA Invested domestic Liberty Multi-Manager has two domestic Frank Russell funds, namely Equity Fund and the RSA Small Cap Fund. The RSA Equity Fund is in domestic large cap stocks whilst the RSA Small Cap invests in domestic small caps.
Liberty Multi-Manager aims to launch an offshore fund that will consist of offshore Frank Russell funds and allow domestic investors access to offshore fund managers with a wealth of international experience. It is already in the process of launching such an offshore fund and has plans to introduce a multi-managed bond fund in the distant future.
Busisa Jiya, an investment strategist heads up the Liberty Multi-Manager division.  The Frank Russell Company, an international investment manager, manages the RSA Equity Fund and the RSA Small Cap Fund, which were both launched in October 1998. The company manages each fund according to a Multi-Asset, Multi-Style Multi-Manager approach it pioneered over 25 years ago. Frank Russell, which is based in the US, has over 200 clients worldwide, representing over US$1 trillion of investment. It has over US$60 billion of investments directly invested in its offshore equity and bond funds. The company already manages R4,2 billion of the Liberty Group’s assets.
Frank Russell specialises in creating and managing well-diversified funds according to strict risk management criteria. The company’s objective is to consistently deliver superior performance relative to chosen benchmarks over the medium to long term. Frank Russell funds aim to outperform chosen benchmarks by a set margin.
According to Mr Jiya, “Frank Russell has direct access to selected individual managers’ investment activities, and continuously monitors investment performance and compliance to the mandates drafted by them. The company accentuates risk-management by adopting a multiple-manager approach consisting of different complementary styles of fund management, as research shows that it is not possible to predict which style will perform best or for how long it will outperform the others. Russell’s fund-management philosophy is to consider all the possible risks so that if a detrimental event takes place only a limited portion of a portfolio would be affected. In fact, the other portions of the portfolio could benefit from the same event.”
The RSA Equity Fund has since inception achieved a compound annual growth rate of 1,5% above the JSE All Share Index, net of management fees.
The RSA Small Cap Fund, invested in the Small Medium Micro Enterprises (SMMEs) of the Johannesburg Stock Exchange, has ranked in the top 50% of its category since its launch. (It is suited to investors wishing to invest in entrepreneurial companies destined to lead the next generation.)
Liberty Multi-Manager previously targeted only retail clients. Given that the Association of Unit Trusts now permits different classes of unit holders, Mr Jiya says, Liberty Multi-Manager will also target wholesale clients. It intends registering B and C classes of unit holders under the two existing Frank Russell RSA Unit Trusts Funds (RSA Equity and RSA Small Cap). The introduction of these classes will enable the division to charge differing management fees (as now permitted by the Association of Unit Trusts). Management fees will range between 0,6% pa and 1,2% pa, in line with rates charged by competitors. The division intends attracting retirement fund clients who will not only broaden Liberty Multi-Manager’s client base but also afford trustees the opportunity of an experienced international multi-manager such as Frank Russell.
“Another opportunity that exists is among offshore investors wanting to invest in emerging markets. It is most likely that such investors will choose an international company (Frank Russell.) with a worldwide reputation to enter those markets, concludes Mr Jiya.
 

Copyright © Insurance Times and Investments® Vol:13.7 1st August, 2000
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