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Carry On

Good businesses do something well. The challenge is finding something that reliably needs doing well as the world changes. Quality management is a balancing act between being successful in the moment, and being prepared for what the world can throw at you. Babcock has focussed on 'Mission Critical' service provision. Their main clients are public bodies whose function is to put the '... and carry on' into the UK's 'keep calm'...

November in review

November saw Donald Trump win a hard-fought election for the presidency of the United States. The surprise result has seen a mixture of effects around the globe. In the US, the DJIA saw four consecutive days of record highs on optimism over tax cuts and fiscal stimulus. In Europe, the FTSE 100 ended the month -2.0% lower as the pound strengthened. In Asia, the Nikkei 225 bounced back from being down as much as -6.7% to end the month up 5.0%. Yields continued to rise across major bond markets, with US 10-year Treasury bonds rising sharply to 2.4% and UK 10-year gilts up to 1.4%. The hardest hit following the election was Mexico, where the peso rose 8.6% and Mexican government 10-year bond yields rose 99bps to 7.3%.

Click below for the latest factsheets.

Citywire Wealth Manager

Office Spotlight featuring Alan Noik

CredoNews #

Credo Wealth was featured in last week's edition of leading UK industry magazine Citywire Wealth Manager.

CNBC Africa

The week in review

This week started with the news that Italians had voted against constitutional reforms in a much anticipated referendum. Deon Gouws, Chief Investment Officer at Credo Wealth was interviewed on this topic (as well as a number of other discussion points) on CNBC Africa.

Credo publishes the Autumn 2016 CREDONEWS

CredoNews #24

Citywire Wealth Manager

Costs in the Asset Management industry

CredoNews #

Ainsley To, Research Analyst at Credo, was featured in last week's edition of leading UK industry magazine Citywire Wealth Manager and discusses costs within the asset management industry and whether the way investors are currently being charged is sustainable.

Culture of Trust

When companies get beyond the size of a single office where everyone knows each other, culture becomes essential. Like any country or community, a business exists because people believe in it. Money exists, not because it actually represents a physical asset, but because people trust that they can use it. The primary role of banks is to facilitate the functioning of an economy. They are in the business of trust. Founded in 1852, Wells Fargo...

Citywire Wealth Manager

Great unknowns: what worries wealth managers?

CredoNews #

Ben Newton, Investment Manager at Credo, says it is uncertainty. In an article in Citywire Wealth Manager earlier this month, he suggests that no one is ever sure what is around the corner in this volatile world and how the market will react...

This is the future: Ascendant Tree People...

Alec Hogg, founder of leading financial website, recently interviewed Deon Gouws (Chief Investment Officer at Credo). The two of them had a frank discussion, inter alia about Donald Trump and the role of populism in politics.


What Trump's presidency really means for investors

This week's US presidential election has been widely debated and analysed in the media. The following article (which was published on leading South African financial website Moneyweb) includes a number of quotes from Credo Chief Investment Officer, Deon Gouws.

CNBC Africa

How Trump's surprise win affects the markets

Donald Trump's victory in the US presidential election surprised investors around the world. Credo CIO Deon Gouws was involved in a debate on this topic, aired on CNBC Africa a few hours after the result became known.

President Donald Trump - the investment case

The outcome of yesterday's US presidential election is sending shockwaves around the world. As was the case with the recent Brexit referendum in the UK, we are seeing raised levels of volatility and widespread weakness in financial markets as a result. What is an investor to make of this? Please refer to this opinion piece by Deon Gouws, Chief Investment Officer at Credo Wealth.

October in review

Another mixed month for markets during October. In Europe, the DAX reached a new 2016 high during the month following positive business activity, before paring gains to end the period with a 1.5% gain. The S&P 500 fell -1.9% following disappointing earnings and within heightened uncertainty going to the US elections. In the UK, the FTSE 100 rose 0.8% as the tailwind from weakness in sterling was offset by pressure on commodity producers from weak oil (-2.9% fall) and precious metal prices (gold has fallen -3.8%). Yields rose in major bond markets, including in the US where 10-year Treasury bonds ended month at 1.8% and UK 10-year gilts rose to 1.2% after better than expected UK economic data.

Click below for the latest factsheets.

CNBC Africa

Impact of S.A's political risk on foreign direct investment

On Tuesday the 11th October, South Africans woke up to the news that the country's Minister of Finance will be charged criminally. Financial markets reacted swiftly. Deon Gouws, Chief Investment Officer at Credo Wealth, was interviewed in this regard on CNBC Africa.

September in review

World markets were mixed during the month of September. The best performing index in the developed market universe was the UK FTSE 100, which finished up 1.7% for the month, buoyed by some stronger than expected economic data and continued weakness in the pound/dollar exchange rate. European indices were generally subdued, with European banks coming under pressure throughout the month following the massive $14bn fine that the US Department of Justice unexpectedly imposed on Deutsche Bank. This figure was nearly three times the size expected by the markets. While Western European markets treaded water, there was similarly little action across the pond, as the major US indices finished fractionally down for the month. The Nasdaq was however the one exception, finishing up 1.8% for the month, with the likes of Amazon, Apple and Twitter enjoying some strong gains. Possibly the most relevant market movement during September was the rising oil price, as OPEC (led by Saudi Arabia and Iran) agreed to a deal on output quotas in an unscheduled OPEC meeting held in Algeria. Russia, although not a member of OPEC, was also party to the deal. This was the first time in eight years that an agreement has been struck to ease the global over-supply of oil and it sent the price of Brent crude back up to $49 per barrel (an increase for the month amounting to 6%).

Click below for the latest factsheets.

Improved Portfolio Reporting in MyCredo

CredoNews #

Credo understands the importance of providing high quality portfolio reports to clients. Based on feedback received, we have made certain enhancements to our investor reports, which are now available in the Reports tab in MyCredo.

Shifting Sands

After suffering for two years at the hands of President Xi Jinping's crackdown on corruption and weak mainland economic growth, it seems that the tide is about to turn for activity in the Macau gambling market. As the nimblest regional operator, Las Vegas Sands stands to benefit disproportionately from this change in fortune. In the wake of Xi's crackdown, the appetite for conspicuous consumption has waned amongst China's elite, leaving a miasma over casino operators' revenues. Over the past year, VIP gross gambling revenues have declined by nearly -22%. Though this weakness is expected to persist for the remainder of the year in the VIP segment, long-term growth in the mass market segment is anticipated to more than compensate: in June of this year mass gaming volumes and revenues increased year on year at...

August in review

August saw equity markets continue to advance after recovering from a small pullback in the first week of the month. European equities outperformed with the MSCI Europe ex UK up 0.78% in USD terms versus 0.14% for the S&P500. UK equities were again amongst the strongest performers in both local currency and USD terms - though contrasting the YTD trend it was smaller companies which outperformed during August as MSCI UK Small Cap increased 1.68% against 0.84% for the large cap index. Whilst bond yields in the US rose slightly to 1.58% during the period, yields in the UK and Germany continued to decline. Having been moving in line with US Treasuries, above 2% just over 18 months ago, 10 yr UK gilts ended the month yielding below 0.65%. Having seen a decline down below 1.29 in the middle of the month, Sterling saw a reversal against the dollar to end August over 1.31.

Click below for the latest factsheets.

Devil take the hindmost

At the height of the South Sea Bubble, William King, the Archbishop of Dublin, concluded that "most that go into the [South Sea] matter are well aware it will not [succeed], but hope to sell before the price falls". An anonymous pamphlet of the time declared "the only way to prevent [loss] to oneself must be to sell out betimes, and so let the Devil take the hindmost". Following one of the longest bull markets in recent history, concerns are...

Tree people versus boat people...

In conversation with Alec Hogg from leading financial website BizNews, Deon Gouws (Chief Investment Officer at Credo) quotes Charles Gave from consultancy firm Gavekal and explains recent economic developments in terms of a simple analogy.

July in review

The S&P 500 registered new highs over July, ending the month up 3.7%. Meanwhile, the US earnings reporting season entered full swing and sentiment was boosted by abundant surprises to the upside. In Europe, like their American counterparts, the ECB opted to continue their accommodative monetary policy stance. The STOXX 50 was up 4.5%. The uncertain ramifications of Brexit continue to weigh heavy in the minds of central bankers globally. Hopes of further stimulus from the Bank of Japan were dashed, as the bank held interest rates at -0.1% and offered only modest additional measures. After the announcement, the Yen soared against the US dollar. Following a failed military coup in Turkey, the BIST 100 fell -1.8%. President Erdogan has responded forcibly with a crackdown, purging thousands of government officials, and has imposed a three-month state of emergency.

Click below for the latest factsheets.

Universal Partners - Unique New Listed Private Equity Opportunity

Credo is currently involved in a very interesting South African (ZAR denominated) investment opportunity for which we are assisting in the raising of capital.

We believe that this is an excellent opportunity to take advantage of a period of relative ZAR strength against the GBP, and use ZAR to invest in what will be a listed private equity vehicle with attractive hard currency exposure. Needless to say, the track records of all the individuals involved speak for themselves.

Credo publishes "BREXIT and beyond" edition

CredoNews #23

June in review

The surprise decision of the UK to leave the European Union sparked a sell off across global markets the day after the vote, with the MSCI UK Total Return Index and sterling down -3.1% and -7.9%, respectively. In the following days, whilst sterling continued to slide, reaching a 30 year low against the dollar, the UK equity market pared losses and the MSCI UK ended the month up 5.0%. Resurgent uncertainty pushed out expectations of interest rate rises while central banks are determined to provide accommodative monetary policy. The US market also recovered in the week after the referendum, with the S&P500 finishing flat for June. In Europe, the STOXX 50 was down -6.2% while worries surrounding contagion mounted. In Japan, following the UK result the yen rose sharply against the US dollar, gaining 7.3% over the month. As reports emerged that US crude stockpiles are dwindling, Brent Crude repeatedly pierced $50 per barrel.

Click below for the latest factsheets.

Let MyCredo do the work for you

CredoNews #

Do you find the task of drawing regular reports tedious? Let MyCredo do the work for you. Subscribe and receive them via e-mail.

#Brexit surprise: The sun will shine again

Following on our earlier client communication about the UK's decision to leave the EU, an abridged version of the same piece was published on leading South African business website BizNews.

The sun will shine again

Financial market volatility has returned with a vengeance, following this morning's UK referendum outcome. Credo's Chief Investment Officer, Deon Gouws, provides some perspective from an investment point of view.

Bremain to confused and back again

After admitting to being somewhat confused by the options in the build-up to the referendum taking place in the UK today, Deon Gouws (Chief Investment Officer at Credo) explains the reasons for his final decision in this piece (as published on the BizNews website).

Brexit: From Remain to Confused

CredoNews #

With the upcoming UK referendum dominating international newspaper headlines, we have been involved in a number of conversations with clients and other interested parties, focusing on a potential Brexit and its likely consequences. At the end of last week, Alec Hogg (founder and CEO of BizNews) discussed this topic with Deon Gouws (Chief Investment Officer at Credo).

Brexit... the Y2K bug of our time?

The upcoming Brexit referendum in the UK has not only generated extremely high levels of international interest, but it has also played a part in terms of increased financial market volatility. In this piece, we discuss the extent to which this issue may have had an impact on how we manage portfolios at Credo.

Five Years of Best Ideas

This past April, our Best Ideas Portfolio celebrated five years since inception. While we typically use this space to talk about a purchase we have made, or provide updates on matters we believe to be of interest, today we offer a belated retrospective and an assessment of how our long-term value driven investment approach has performed. Over the five years since inception, the Best Ideas Portfolio has returned...


Does the Brexit vote matter?

Following his recent television interview discussing a possible Brexit in next week's referendum in the UK, Deon Gouws (Chief Investment Officer at Credo) was interviewed by Bruce Whitfield on The Money Show, aired on 702.

CNBC Africa

Should we be worried about Brexit?

The upcoming referendum about the question whether Britain should leave or remain in the European Union has led to an increasing amount of market volatility over the past few weeks. Deon Gouws (Chief Investment Officer at Credo) was recently interviewed by CNBC Africa on this topic.

Credo held its fourth International Conference

CredoNews #

In the first week of June, Credo hosted its fourth annual International Conference across 5 different cities in South Africa, attended by more than 500 delegates. The stage was set for Roy Ettlinger (CEO), Alan Noik (Managing Director), Ainsley To (Research Analyst), Jarod Cahn (Director), and Deon Gouws (CIO) to express their views on Credo's growth as a business and the current climate in global financial markets.

May in review

In the US, hawkish comments by several Federal Reserve officials roused speculation over the possibility of a June interest rate hike, sooner than previously expected. Meanwhile, despite turbulence, the S&P 500 ended the month up 1.8%. Following a 6 month rally, Brent Crude hit new highs, almost piercing the $50 mark. In the UK, sterling rallied while the latest slew of polls indicated faltering support for the Leave campaign. The MSCI UK Index rose 0.2%. Amid concerns over the Eurozone's future, the European Commission opted to postpone a decision on disciplinary action against Spain and Portugal for breaking budget rules while the IMF reiterated that it would not participate in the latest Greek bailout without extensive debt relief. The STOXX 600 ended the month up 2.7%. In Brazil, initial enthusiasm for the new government following the impeachment of Dilma Rousseff was soon replaced with concerns over the poor state of the economy. The MSCI Emerging Markets Index ended the month down -3.9%.

Click below for the latest factsheets.


Aegon is one of the world's largest insurance companies, with a market capitalisation of US$9.7bn. In 2015 Aegon wrote gross premiums of 20.3bn euros of which 17bn euros was life insurance, 2.7bn euros was accident and health insurance, and 0.6bn euros was general insurance. Aegon's business is predominately...

Search function to the rescue

Do you sometimes battle to find the right account, portfolio or security on MyCredo? Do not fear, the search function is near. Typing a portion of an account name or number, or a security name or identifier in the search field will return results for all items, which contain the search criteria entered.

Never judge your President until you've slept in the same bed

CredoNews #

On a recent trip to South Africa, Credo CIO, Deon Gouws, had an interesting experience when checking into his hotel in Port Elizabeth.

April in review

US equity indices rose slightly over April, and the S&P 500 ended the month up 0.4%. Meanwhile, first-quarter corporate earnings results trumped expectations as weekly jobless claims hit their lowest level since 1973. Accordingly, New York Federal Reserve president, William Dudley, remarked that given the "mostly favourable" economic conditions, the Fed remains cautious about raising interest rates. With the upcoming referendum on European Union membership, uncertainty continues to hang over the UK. The Treasury published a report suggesting a withdrawal from the common market could shrink the UK economy by 6.5% over 15 years. Meanwhile, the MSCI UK rose 1.5%. In spite of major oil producers' failure to agree a production freeze, falling US production and a strike by Kuwait's energy workers more than offset disappointment and supported the continued rally in the commodity.

Click below for the latest factsheets.

Fortune favours the brave

Viewing the eruption of Mount Vesuvius from his ship in the Gulf of Naples, Pliny the Elder declared that "Fortune favours the brave" and set a course to rescue his friends from Stabiae, near Pompeii. Needless to say, Fortune did not favour him. Nevertheless, his maxim has become a byword for seizing opportunity whenever it presents itself. McKesson is one such opportunity: having suffered at the hands of an over-zealous market, the stock now...

Smart dates just got smarter

Credo's in-house development team works tirelessly to improve the user experience of our platform, MyCredo. We have enhanced the smart dates for reporting to include UK & SA Tax periods and a "Since Inception" option.

March in review

US equity indices inched into positive territory for the year to date over March. A 6.8% monthly gain for the S&P 500 took the index to a 1.3% return for 2016. Though the Federal Reserve left rates unchanged, inflation data supports the view that rate normalisation will continue this year. US core inflation rose 0.3% in February, taking the annual rate to 2.3%. The ECB announced a further asset purchase programme, which extends to non-financial corporate bonds. Yields have since dropped to below 1%, prompting a wave of corporate bond issuance. In the UK, given falling inflation expectations and continued efforts to reduce the budget deficit, consensus expects rates to remain on hold. In Asia, the MSCI China rose 10.2%, reflecting greater confidence in the ability of the authorities to support growth.

Click below for the latest factsheets.

The case for Brexit?

CredoNews #

On Wednesday the 23rd March, Credo hosted an intimate conversation about the case for and against Brexit. The discussion was led by Lord David Young and centred around the potential consequences for the UK and the EU.

Left to right: Alan Noik, Alec Hogg, Roy Ettlinger and Deon Gouws-->

Not all value is created equal

No doubt our clients are by now accustomed to our refrain: at Credo, we are value investors. The notion of focusing on valuation is intuitively appealing: after all, only a fool would pay over the odds. Yet within this comforting and attractive appellation are innumerable shades of grey. As far as the intuitive appeal goes, all valuation approaches are created equal but, when it comes to investment execution, some are more equal than others.

Though value may make for easy marketing, a glance at recent history confirms it by no means makes for easy investing. Over the last 10 years...


The recent upgrade of Investec debt by the rating agencies Fitch and Moody's, has promoted the subordinated paper to investment grade, providing further confidence in one of Credo's larger and long term fixed income positions. The upgrades are as a result of the...

Credo publishes "Year of the red monkey" edition

CredoNews #22

February in review

Though January's market volatility persisted into February, this eased over the month and the S&P 500 ended the month down 0.1%. Sentiment over the US economy improved on the back of strengthening economic data and better than expected inflation figures. Investors' attention is now focused on the release of the latest Fed minutes, with many expecting a more dovish tone. Despite the prospect of further ECB stimulus, speculation surrounded European financial stability, following sharp losses in banking stocks. Concerns remain that negative deposit rates may damage bank profitability. The STOXX 600 ended the month down 2.1%. Following the New Year holiday, sentiment surrounding China improved as comments from the PBOC governor Zhou Xiaochuan suggested the central bank saw no need for further renminbi weakness. Volatility eased, and the Shanghai Composite ended the month down -1.8%.

Click below for the latest factsheets.

Testing Times

Galen, the philosopher-physician of late antiquity, is reputed to have remarked of a certain cure that "all who drink of this treatment recover in a short time, except those whom it does not help, who all die." Thankfully, with the advent of laboratory testing and peer reviewed research, such quackery has long since been expunged from modern medicine. In the US alone, the laboratory testing market is worth $75bn, accounting for approximately 3% of total healthcare expenditure. Of this, Quest Diagnostics dominates as one half of an effective duopoly.

As the major player in an industry enjoying secular tailwinds such as population growth, an ageing population, and increasing healthcare coverage, Quest's performance in recent years has hardly been...

Finweek - Collective Insight

Chronocentricity - Will this time really be different?

CredoNews #

The latest edition of Finweek's supplement Collective Insight, published in January 2016, features Ainsley To, analyst on the Multi-Asset team at Credo, his thoughts on some disruptive forces in the industry and why "this time isn't always different".

January in review

It has been a tumultuous start to the year, with an unprecedented degree of volatility across markets. In the US alone, the S&P 500 fell - 5.9% in the first five trading days; the worst first week since records began. In China, the expiry of a ban on selling by large investors contributed to plunging prices, triggering circuit breakers on two consecutive days. The Shanghai Composite ended the month down - 22.6%. In Europe, extreme volatility eased as the ECB suggested additional policy support was imminent. In like fashion, Mark Carney announced that, given the oil slump, global volatility, and slowdown in UK wage growth, the choice of monetary policy was now "straightforward"; the accommodative status quo is likely to remain. Meanwhile, the MSCI UK Index fell almost 20% below its recent high - the definition of a bear market - but ended the month down only -2.4%.

Click below for the latest factsheets.

No crystal ball, no matter how bearish the forecast

Following his recent piece 'There is no crystal ball', where he offers his views about the tumultuous start to the year in global markets, the article by Deon Gouws was also featured on leading financial and business website BizNews.

Portfolio Adviser

Hanson appoints Credo as outsourcing partner

Hanson Asset Management has appointed Credo as its administration outsourcing partner for its Wealth Management business. Under the arrangement, Credo will provide Hanson with a complete service for multi-asset global trading, custody and branded investor performance reporting for Hanson's clients. In addition, Credo will provide certain technology solutions to Hanson, including fully integrated portfolio management software and a Hanson branded investor portal.

Not up in smoke yet

We often use this space to discuss a recent addition, or to comment on the economy at large. This time, however, we would like to draw our readers' attention to one of our long-term holdings which, though often overlooked, is among the largest contributors to the total return of both the Best Ideas Portfolio and the Dividend Growth Portfolio.

As a market leader in a capital-light industry, we bought...

Credo and BizNews

CredoNews #

Left to right: Alan Noik, Alec Hogg, Roy Ettlinger and Deon Gouws

On Wednesday the 13th of January, Credo hosted an intimate conversation about the World Economic Forum Annual Meeting 2016 which takes place in Davos. The discussion centered around how this get together of global leaders and thinkers will shape the international economy in the year ahead. The founder of leading financial website BizNews, Alec Hogg (who participates at the event for the 13th successive time this year), was interviewed by Credo CIO, Deon Gouws.

December in review

For the first time since 2006, and following months of speculation, the US Federal Reserve raised interest rates by one quarter point (0.25%). In the accompanying press conference, Fed Chair Janet Yellen emphasised that the pace of rate rises would now be gradual. Meanwhile the S&P 500 fell -1.6%. Commodity prices continued to slide over the month, with Brent Crude touching a seven-year low of $36.1. The Bloomberg Commodities Index slipped -3.1%. The UK's FTSE 100, which has a heavy weighting to mining and energy stocks, also suffered, falling -1.7%. Although the ECB announced an extension to the quantitative easing programme, investors had expected an increase in monthly asset purchases which did not materialise. Following the announcement, both the euro and European bond yields rose. In Japan, recession was averted as third-quarter GDP growth was sharply from an annualised contraction of 0.8% to an annualised expansion of 1.0%.

Click below for the latest factsheets.