Global solutions for South African investors.

The strength of our investment philosophy and process is rooted in active asset management—guided by skilled manager research, to construct multi-asset solutions or inform thoughtful asset allocation, and monitored by independent risk management. Our clients benefit from our innovative approach to global equities—specifically, our knowledge and experience running both multi-manager and factor-based solutions.

Multi-manager, systematic factor strategies, or a blend of both: What’s the right strategy for you?

Multi-manager programme

In contrast to traditional fund managers who select individual shares, a multi-manager selects other investment managers, each tasked with investing a portion of their portfolio to set specifications.

Potential advantages:

• Manager access: SEI’s Investment Management Unit (IMU) selects the best investment managers for inclusion in our multi-managed funds, some of whom may not be accessible to South African investors directly.

• Manager-style diversification: To gain exposure to what we refer to as our ‘alpha sources’, we combine managers of different styles, creating funds that offer diversification and help investors manage risk.

Systematic factor-based strategies

In global equities, we run several systematic factor-based strategies. For us, ‘rewarded factors’ represent a potential source of alpha.¹

Potential advantages:

• Greater stock diversification: Unlike passive strategies—which track specified indices² and often invest in the same companies, leaving investors exposed to overcrowding risk—factor-based strategies offer greater diversification.

• Cost efficiencies: As factor investing applies a rules-based approach to stock selection, it tends to be a cost-efficient relative to traditional active management. Importantly, factor-based strategies can still be actively managed—our approach is fully active.

¹ These are the factors that consistently and empirically drive returns across different asset classes, geographies and timeframes. Examples of ‘rewarded factors’ include value, momentum, and quality.

² Often referred to as the ‘benchmark’.

A combination of the two

In 2023, we launched the SEI Select equity fund range. This new range blends SEI’s systematic factor strategies with the portfolios of fundamental stock pickers.

Potential advantages:

• Lower active risk: Top-performing fundamental managers often assume significant risk to achieve their objectives. Incorporating these managers into a diversified portfolio of rewarded factors helps mitigate this risk.

• Potential for better net returns: The average fundamental manager tends to underperform the market once fees are taken into consideration.³ We believe blending the very best active managers with exposure to rewarded factors creates a cost-efficient portfolio.

³ Passive funds charge significantly lower fees, but many still underperform on a net returns basis.