In October 2019 the average prudential balanced portfolio returned 1.6% (September 2019: 1.3%). Top performer is Momentum Namibia Growth Fund with 2.2%, while Investec with 1.2% takes the bottom spot. For the 3-month period, Allan Gray Namibia Balanced Fund takes top spot, outperforming the ‘average’ by roughly 1.2%. On the other end of the scale Stanlib Managed Fund underperformed the ‘average’ by 1.2%. Note that these returns are before (gross of) asset management fees.

The Monthly Review of Portfolio Performance to 31 October 2019 provides a full review of portfolio performances and other interesting analyses.

Evaluating your investment managers and your investment portfolio

When evaluating investment managers, the text books will tell you that you should consider the 6 P’s:-

• the people responsible for managing the portfolio;
• the philosophy applied in managing the portfolio;
• the process followed in managing the portfolio;
• the characteristics and composition of the product or products available for investment;
• the price charged for managing the portfolio; and
• the performance track record of the portfolio.

Of these, only performance is an objective measure. All the other criteria are subjective and require the person who evaluates them to apply his personal judgment in order to reach a conclusion. When one considers performance track record, every expert will tell you that you cannot place any value on this criterium as historic performance gives no reliable indication of future performance and this has been shown to be true by just about every piece of research that has ever been published on this topic, but it is the only measurable criterium. When you consider all the criteria, aren’t you also only looking at historic evidence in any event, even if it was obtained a minute ago – it is history when you look at it and there is no way you can be sure that what you have seen today will be the same you will see tomorrow, as long as you consider anything that involves people.