Hard Resets & Purpose
F&A Monthly Update | April 2021
I recently took some time out both in the Berg on my own, and then very happily spent a week in Cape Town, just Andrea and me. I needed both trips badly, one to collect myself and one to have some fun! The past year has been taxing on us all. I am very fortunate and grateful to have an incredible team around me, both professionally and personally, that can support me when I need it!
The purpose of the Berg trip was a Hard Reset. It was intentional and is something I will continue to do at least once a year. I took time out, on my own, in nature, trying to extract those silver threads of clarity from one’s mind that get lost when you are too busy or too worn down. The formula was simple: just you, no technology, no distractions, a beautiful location (I went to Lotheni in the Drakensberg, just below Giants Castle - an absolute slice of heaven!), 3 days or more if necessary, a journal, healthy food and an inspiring book. The objective was to journal, intently. To extract all challenges, setbacks and pain on one day (very taxing) and then the opposite on the other, to capture all the wins, successes and progress. The final day was a review of both, while sketching out an updated strategic plan for tackling what is identified and prioritised.
Cape Town, in contrast was good fun. Hikes, sights, spending time with special family and friends, good food and wine, and a couple lovely days in Paternoster. No kids. We missed them, and they missed us, but man, we all needed it! I know Ez and Lu loved having sleep overs at each set of grandparents, and I am told that the grandparents loved it too!
The trips combined, have done the trick! I know how and where I want to focus my energy and that in itself is a success!
Core Values
F&A is a huge part of who I am, in the sense that: it is me trying to take the model answer/s I believe in and build them outside of myself, beyond all boundaries, so that they may survive me. I have worked hard to have the business reflect 2 core values I believe to be non-negotiable:
To be the best you can be
To make a positive difference to others / to be the change / Life Changing
In the above respect, we are in a completely privileged position.
CORE VALUE 1:
To be the best we can be
The business continues to provide ongoing and exceptional outcomes for our clients. We see this both in client feedback and retention rates (99%) and in the progress of each strategy we track and attend to. The strategies are doing what they are designed to do! It may seem obvious, or simple, or expected, but this is nothing to turn ones nose up at. Fascinatingly, we have had several calls and queries lately around de-risking client portfolios because returns are too good to be true. We apologise for this (ha!). Jokes aside, the same portfolios which absorbed a COVID shock are now thriving, and this is something we are very proud of.
In all seriousness, the bar here is set at world class and that is something I am unyielding on. Should you pick up a misstep, an inefficiency or something you are not happy with, please tell us. Feedback is rocket fuel! We would deeply appreciate it.
CORE VALUE 2:
To make a positive difference to others /
To be the change / Life Changing
We aim to make a positive difference to each stakeholder we interact with, and especially our clients. And the fulfilment of client strategies realises this value.
Beyond this, I am working on a Community Ecosystem project. One which subscribes to the basic tenets of sharing. I believe we can create a positive environment between F&A, all of its many stakeholders, current clients, future clients, the communities in which we live, and those that need love, support and investment. A project which is about balance and sustainability.
The premise I am trying to solve for is: Can a for-profit business add more value to its community than just the services or products it provides? I believe it can. Please watch this space!
For now, a further positive month for the markets, and the Rand (Which broke R14 to the Dollar just yesterday!). More below from Brendan.
April 2021 Update
This month's piece is compiled by Brendan de Jongh, SA Head of Research - PortfolioMetrix.
Local Update
South African Property comfortably outperformed all other asset classes for the month with global property the second-best performer. Property was buoyed by global yields falling back slightly and positive economic data providing a strong tailwind to a pro-cyclical asset class. The rand strengthened over the month which tempered returns of global asset classes when viewed in rands. South African bonds also had a reasonably good month with positive data supporting a “better than expected” scenario for government finances resulting in reductions in issuances by Treasury.
Local equities produced mediocre performance with Resources again the best performing sector. Interestingly, lower liquidity small-cap stocks performed strongly over the month and have meaningfully outperformed the large-cap segment over the last year.
Global Update
April was another good month for most economies on the data front, with some very notable exceptions in Japan and India. Bond yields, that had risen in prior months on the back of inflation expectations, started to fade a little. And following several stronger months, cheaper ‘value’ companies underperformed their growth counterparts. Finally, sustainability returned to the forefront of investors’ minds as the UK, US, and China all announced larger and faster reductions of carbon emissions relative to their previous commitments.