InPerspective caught up with Portfolio Manager Unathi Loos. Unathi shares her career journey with us, her investment outlook, what motivates her and her views on diversity.
Q You’ve had a fascinating career, straddling humanities, banking and now portfolio management. How did your journey evolve?
A key theme in my life has been my commitment to excellence – to find a career where I can be the best that I can be. It hasn’t been a straightforward journey. Growing up, I was not exposed to equity investing and asset management as a career choice. I started off in the medical sciences because I wanted to help people and make a difference. Through a journey of self-discovery and a personal commitment to realising my full potential, I stumbled into the financial services industry by chance, and have never looked back.
I joined Investec Private Bank ten years ago, where I had the opportunity to gain valuable experience in finance and to further my studies. While I was completing my MBA, it became clear to me that I actually wanted to do equity analysis. So I was deliberate in the elective courses I chose to gain skills in finance, portfolio management, equity analysis, valuations and business strategy.
I had already studied and gained experience in the helping professions and had brief encounters with organisational development, advertising, marketing and public relations, so I focused on enhancing my finance skills. Investec Private Bank was great and gave me numerous opportunities to practice my new-found skills, and this led to me landing a position as an equity analyst at Investec Asset Management five-and-a-half years ago. The learning and the journey have not stopped, and each day is about diligently doing the right things to become better and better.
Q You joined Investec Asset Management in 2012 and currently you have co-portfolio management responsibilities for the South African Resources strategy as well as the General Equity strategy, within the SA 4Factor team. What do you enjoy about your role?
I love that my role is multifaceted. Understanding different business models – why some businesses are more successful than others and the factors that determine their sustainability – fascinates me. Valuing and modelling companies’ earnings form an integral part of what I do, which I really enjoy. And of course, the ‘big picture’ macro view is also important. Added to this, our investment philosophy – investing in companies with positive earnings revisions trading at reasonable valuations – is based on understanding investor behavioural biases, which has its roots in behavioural finance. So in my opinion, to form a coherent view of an investment, you need to draw on various academic disciplines and this makes for a very stimulating field of work.
Q Financial markets are very volatile and trade wars have created a lot of uncertainty. What are your views on the markets?
We’ve had an interesting few months, particularly from an SA investor perspective. The positive political change within the ruling party sparked widespread optimism. The expectation was that the improved business and consumer confidence would spur investment and spending and translate into stronger economic growth over time, thereby underpinning SA equities. But the global environment has changed which has had an impact on our domestic market. Global investors have become concerned about the trade wars. Escalating tensions between the US and China could destabilise the synchronised global growth that we’ve seen. The market is also concerned about the length of the US equity bull market and is trying to time the inflection point. On the one hand, equity valuations are high, but on the other hand, companies are still reporting good earnings, and not all due to tax cuts.
I think the current environment requires some caution. Although we are cognisant of macro factors, we focus strongly on bottom-up stock picking. This is particularly important at inflection points. So we stay close to the companies in which we are invested, ensuring our positions are based on strong fundamentals (earnings growing ahead of expectations at reasonable valuations). We haven’t tilted our portfolios to be more defensive, but we are a lot more cautious than we were at the beginning of the year.
Q What are some of your favourite stock ideas?
I believe that our domestic-oriented stocks still offer some great opportunities. My two best picks in SA are Mr Price and FirstRand. They are high-quality stocks trading at reasonable valuations and their fundamentals remain robust. Both companies’ earnings are coming in well ahead of expectations. The sell-off in emerging markets has created some attractive stock-picking opportunities.
We have been overweight resources, relative to our benchmark and our peers year to date, which has been positive. Sasol, BHP Billiton and Anglo American have been standout performers this year. We still like resources stocks because they are procyclical but also offer some hedging to the rand.
Q Portfolio management remains a very male-dominated world. What has been your experience?
In the beginning, I found it slightly intimidating, being one of a few women in the room. What motivates me is that I am acutely aware that I do not just represent myself in the workplace. I represent a whole history of women who have worked hard to break down barriers to create opportunities for me. I have a responsibility to the next generation of women to push a little bit further so that it will be easier for them as well. I feel like if I were to turn back, I would not only disappoint the people who have sacrificed a lot to get me here but actually do future generations a disservice. So I press on because I believe that I am part of a continuum of women, representing the progress of women across time. I come from generations of domestic workers. My mother is a beacon because she was the first to get an education and became a teacher. So it is very personal for me: carrying on the tradition that my mother started and making my mark in the finance world because that is where I have found my niche. So I am not likely to let being the ‘only girl’ in the room get me down; this is too important.
Q Investec Inspire is a network for women at Investec Asset Management which enables the exchange of knowledge and experiences in order to improve the opportunities for career success. As a member of the steering committee, do you think this initiative could lead to policy changes?
Yes, that is the intention. It’s about finding ways that we can remove some of the barriers that women experience in the workplace. For some, flexible working hours and longer maternity leave is a priority. For others, it’s about removing the perceived glass ceiling so that they can look forward to greater career progression. It’s about understanding what these barriers are, real and perceived, and doing our best to remove them. Investec Inspire is a great platform for driving this agenda and has the full support of executive management, which is really exciting. Investec Asset Management has made a commitment to addressing imbalances and the retention and promotion of women in key roles, and this resonates well with me.
Q What does diversity mean to you?
Although it starts with gender and race, I think diversity goes a lot further than that. It’s about promoting different thinking and accommodating different world views. You want a workplace that has people with different world views because diverse teams are better at solving problems and finding opportunities than teams with homogenous backgrounds and skill sets. For me, diversity is about creating a safe space for people to freely express who they are without fear of being rejected or ostracised. Companies often employ people for their differences, and once inside, do their best to strip them of those differences. This is a pity, as I think that in the ever-changing world of finance, where the issues are so complex and yesterday’s problems are not going to be tomorrow’s problems, you need to have teams with a wide range of skills, opinions and abilities. This is true diversity.
Q Who has been an inspiration to you?
My great-grandmother has been a huge source of inspiration. She was a resilient woman. She had no formal education and lived modestly but had immense influence in her community. Everyone knew her; she opened her heart to the community and her house was always full of visitors. My great-grandmother was very hard working and she instilled a strong work ethic in all of us. Above all, she was generous and kind. She played a major role in helping to shape my character.
Q What would you tell your teenage self?
It’s okay to make mistakes. Don’t shut doors too quickly, explore more and try different things.
Q What are you passionate about?
I care about South Africa, social justice and education. I love languages, books, travelling and experiencing different cultures. Cooking wholesome meals for family and friends gives me a lot of pleasure. I am passionate about my family, and my children are my greatest joy. As my children are still young (2 and 6), we spend a lot of time going to birthday parties, swimming lessons and seeking out child-friendly activities on the weekends. One of my favourite memories is of a holiday with my husband early on in our relationship where we spent time on the island of Ponza in Italy. We hiked up a mountain, found a cave and camped there for a few days. The cave overlooked vineyards and stared straight into the ocean. We were young, fearless and penniless – it was fantastic!
Unathi is a portfolio manager with co-portfolio management responsibilities for the South African Resources strategy as well as the General Equity strategy, within the SA 4Factor team. She is also responsible for the analysis of the South African-listed chemicals and diversified mining companies. Unathi joined the firm from Investec’s Private Bank division, where she was an internal and external consultant covering credit applications and loan agreements since February 2008. Prior to joining Investec, she was a business director at Amperzand Advertising and an organisational development consultant at Resources for African Innovations. Earlier in her career, she worked as an occupational therapist in addictions and with children with cerebral palsy, and also spent some time in a non-profit organisation. Unathi has a Bachelor of Occupational Therapy degree from the University of Stellenbosch. She graduated cum laude from the University of Cape Town with a Master’s degree in Business Administration. Unathi has also passed Level II of the CFA Programme.
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