1. A division of Efficient Group
SENATE GROUP PRESENTATION
25 March 2011
2. AGENDA
1. The Efficient Group (EF Group)
2. Efficient Select (EF Select)
3. Single Manager Boutique
4. Multi Manager Boutique
5. Private Client Boutique
6. Questions
3. EF GROUP
• The EF Group is a diversified financial services business that provides a wide range of professional
services and products
• EF Group was born from the merger of a number of financial entities in September 2007
• The company was successfully listed on the Johannesburg Stock Exchange on 20 April 2009
7. ROLE PLAYERS
Harold Hopking – Managing Director
Founding member of the EF Group, with over 20 years investment experience
Brendan Vadas – Chief Investment Officer
Is a CFA Charter Holder, Airline Transport Pilot and US Commercial flight Instructor
Our team consists of 10 investment professionals
8. ACHIEVEMENTS
• Standard and Poor’s Award in 2005
• Raging Bull certificate in 2006
• 2 Micropal Award in 2008
9. FUNDS UNDER
MANAGEMENT
Single Manager: R 750 million
Multli-Manager: R 1 500 million
Private Clients: R 300 million
Outsourced: R 450 million
Total FUM: R 3 billion
10. A division of Efficient Group
EFFICIENT SELECT SINGLE MANAGER
BOUTIQUE
11. PEOPLE
Jean-Pierre du Plessis.
Head of Single Managers
B.Business Science (Finance) (UCT)
Rob Enslin.
Dealer, Assistant fund manager
B.Comm Hons (Financial Analysis) (Stellenbosch)
CFA level 2 candidate
Stuart Sinclair.
Analyst, Assistant fund manager
B.Comm Hons (Inv man. & Ecos) (Stellenbosch)
Enrolled in the CIMA programme
Marius Van Wyk.
Analyst, Assistant fund manager
B.Eng (Electric & Electronic) (Stellenbosch)
MSC.Eng Cum Laude (Stellenbosch)
Passed CFA level 2
Ryan McCaughey
Intern
B Com Financial Analysis (Honours)
14. FORWARD
ANALYSIS
How we apply the FORWARD Investment Philosophy to analyzing stocks:
F Fundamentals
O Opportunities
R Risks
W Wealth creation
A Assets
R Reliability of Management
D Dividends
15. THE 6 CATEGORIES
OF STOCKS
A unique but logical approach to how we view all listed shares:
1. Fast growers
2. Slow Growers
3. Stalwarts
4. Asset Plays
5. Cyclicals
6. Turnarounds
* Inspired by Peter Lynch
17. A division of Efficient Group
EFFICIENT SELECT SINGLE
MANAGER FUNDS
18. EFFICIENT EQUITY
FUND
• Category: General Equity
• Benchmark:J203T
• Fund Size: R240m
• The focus of this fund is to provide the investor with above average capital growth
by being fully invested in SA equities at all times
• We aim to do this by applying our FORWARD investment philosophy to South
African equities and property companies
• The portfolio is managed in a benchmark agnostic manner
19. EFFICIENT EQUITY
FUND
TOP 10 HOLDINGS
1. BHPBilliton
2. Clicks
3. Pinnacle
4. Famous Brands
5. Steinhoff
6. Old Mutual
7. Woolworths
8. ABSA
9. ABIL
10. Discovery
20. EFFICIENT EQUITY
FUND
41%
29%
26%
4%
STOCK CATEGORIES
Cyclical
Stalwart
Fast Grower
Slow Grower
STYLES %
VALUE STOCKS 57.69%
GROWTH STOCKS 38.46%
DIVIDEND YIELD 3.85%
OPPORTUNITES 0.00%
TOTAL NUMBER OF STOCKS 32
MARKET CAP %
LARGE CAP 52.24%
MID CAP 20.60%
SMALL CAP 27.16%
AVERAGE MARKET CAP (BN) R 52.35
CRISIS TRADES
NAME SHARES % OF FUND
BIL 863 586 2.5%
MTN 128 594 2.0%
SOL 127 979 2.0%
ASA 144 264 1.5%
OML 63 243 2.0%
TOTAL 10.0%
21. EFFICIENT
PROPERTY FUND
• Category: Real Estate
• Benchmark:J253T
• Fund Size: R200m
• The focus of this fund is to provide the investor with income as well capital
growth
• We aim to do this by applying our FORWARD investment philosophy to
South African property companies
• The portfolio is managed in a benchmark agnostic manner
22. TOP 10 HOLDINGS
1. Growthpoint
2. Hyprop
3. Resilient
4. Acucap
5. Unibail Rodamco
6. Pangbourne
7. Redefine
8. Capital
9. Hospitality A
10. SA Corporate
7%
50%
18%
19%
6%
0%
SECTOR ALLOCATION
Cash
Retail
Office
Industrial
Hotels
Residential
EFFICIENT
PROPERTY FUND
23. EFFICIENT ACTIVE
ALLOCATION FUND
• Category: Worldwide Flexible
• Benchmark: CPI+4
• Fund Size: R180m
• The focus of this fund is to provide the investor with long term capital growth
through global diversification
• The focus of this fund is to provide South African investors with a vehicle
for global equity exposure and diversification
• The fund aims to have at least 50% of it’s assets offshore at any one time
• The management of this fund consists of 2 parts – domestic and offshore.
Our FORWARD philosophy is utilised in selecting both SA equities and
global companies
24. EFFICIENT ACTIVE
ALLOCATION FUND
TOP 10 HOLDINGS:
1. Templeton Asian Growth
2. Templeton Latin America
3. Templeton Eastern Europe
4. Swatch
5. Unibail Rodamco
6. Yum Brands
7. New Gold
8. Monsanto
9. Hyundai
10. GlaxoSmithKline
35%
18%
14%
10%
9%
8%
6%
COUNTRY ALLOCATION
SOUTH AFRICA
USA
UK
EUROPE
ASIA EX JAPAN
AUSTRALIA
LATIN AMERICA
DELVOPED VS DEVELOPING %
DEVELOPED 47.91%
DEVELOPING 52.09%
25. EFFICIENT
PRUDENTIAL FUND
• Category: Prudential Variable
• Benchmark: 65% ALSI, 35% Cash
• Fund Size: R105m
• The focus of this fund is to provide the investor with capital growth within the
risk parameters associated with retirement funding investments
• The fund achieves this objective through the use of derivatives, a minimum
cash holding and stock picking
26. EFFICIENT
PRUDENTIAL FUND
TOP 10 HOLDINGS
• Efficient Property
• Efficient Active Allocation
• Clicks
• Pinnacle
• Steinhoff
• Lewis
• Old Mutual
• Famous Brands
• Discovery
• ABIL
SCENARIO ANALYSIS
% Ret (P) % Ret (B) % Ret +/-
Euro Weakens (Sovereign Debt Crisis)
-0.92 -4.23
3.31
9/11 Event (Terrorist Attack)
-2.65 -5.92
3.27
Dotcom Bubble Bursts (Market Bubble)
2.29 4.4
-2.11
Invasion of Iraq (Major War)
-3.05 -5.59
2.54
Flight to Quality (Flight to Dev Mkts)
-2.98 -4.54
1.56
Economic Recovery Falters (Double-dip)
-4.02 -5.77
1.75
US in Recession (Growth Concerns)
-3.3 -5.18
1.88
Interest Rates up 100bps (Inflation Rises)
0.02 0
0.02
27. EFFICIENT MONEY
MARKET FUND
• Category: Money Market
• Benchmark: 3 Month Jibar
• Fund Size: R73m
• The focus of this fund is to provide the investor with cash beating returns over
time while ensuring capital preservation
28. RANKINGS
FUND 6 MONTHS 1 YEAR
Rank No. of
funds
Rank No. of
funds
EFFICIENT EQUITY FUND
22 85 55 85
EFFICIENT ACTIVE ALLOCATION
FUND 2 16 1 15
EFFICIENT PROPERTY FUND
6 22 6 21
EFFICIENT PRUDENTIAL FUND
13 63 13 58
29. MARKET OUTLOOK
• Japanese recession concerns; Euro area uncertainty and global political instability will add to
market volatility
• US recovery on track
• Emerging markets will continue to drive global growth and consumption
• Market Volatility will continue providing us with great opportunities to buy our favourite
stocks at discounted prices
30. A division of Efficient Group
EFFICIENT SELECT MULTI MANAGER
BOUTIQUE
33. Q1-2011
HOUSEVIEW
NEGATIVE CAUTIOUS NEUTRAL OPTMISTIC POSITIVE
LOCAL
CASH
(-) Relatively better value
in Property and Equity
(+) SA yields still more
attractive than DM’s
LOCAL
BONDS
(-) Inflation has bottomed
(+) Rate hikes expected
only in H2 (not Q1 or Q2)
LOCAL
PROPERTY
(-) May have peaked
(+) Vacancies decreasing
(+) Positive GDP growth
expected
LOCAL
EQUITY
(+) “BRICS” invite
emphasises
Gateway to Africa;
(+) Commodities up-cycle
under way
OFFSHORE
CASH
(-) Zero Rates
OFFSHORE
BONDS
(-) Inflation concerns
OFFSHORE
PROPERTY
(+) Attractive valuations
OFFSHORE
EQUITY
(+) Attractive valuations
36. INVESTMENT
PROCESS (B)
EQUITY
Manager Universe
Absa
Cadiz
Efficient
Old Mutual
Fund Universe
Asset Allocation
General Equity
Sector Tilts
PROPERTY
Manager Universe
Efficient
Stanlib
Fund Universe
Listed Property
FIXED INTEREST
Manager Universe
Prudential
RMB
SIM
Fund Universe
Varied Specialist
Qualitative Manager Assessment: Bi-Annual Due Diligence and Scoring Process
Quantitative Fund Analysis: Morningstar
Portfolio Construction: Correlation
37. UNDERLYING
FUNDS
OLD MUTUAL MINING & RES R………………………………….257.22
ABSA SELECT EQUITY…………………………………………………194.12
EFFICIENT EQUITY……………………………………………………..149.61
EFFICIENT PROPERTY…………………………………………………143.08
FTSE/JSE ALL SHARE PR ZAR………………………………………122.21
RMB INCOME PLUS A………………………………………………..81.43
CUMULATIVE RETURN
GROWTH OVER 6 YEARS TO 23 MARCH 2011
38. A division of Efficient Group
EFFICIENT INTERNATIONAL FoF
39. ASSET + FUND
ALLOCATION
EFFICIENT INTERNATIONAL FOF (USD)
28 FEBRUARY 2011
79%
9%
7%
4%1%
ASSET
ALLOCATION
Equity
Real Estate
Fixed Interest
Gold
Cash
0.00% 5.00% 10.00% 15.00%
Cash 1%
SPDR Gold Exchange Traded Fund 4%
ACPI Global Credit Fund 2%
Fidelity Emerging Market Debt Fund 5%
VAM-Funds International Real Estate Fund 9%
Templeton Latin America Fund 3%
Franklin Mid-East North Africa Fund 5%
Franklin Technology Fund 6%
Fidelity Global Technology Fund 7%
Orbis Asia ex Japan Fund 7%
Templeton Brazil Russia India China Fund 8%
Fidelity Australia Fund 9%
Fidelity China Focus Fund 11%
VAM-Funds US Microcap Growth Fund 11%
Templeton Emerging Markets Small Cap Fund 12%
FUND ALLOCATION
40. REGIONAL
ALLOCATION
EFFICIENT INTERNATIONAL FOF (USD)
28 FEBRUARY 2011
38% 62%
REGIONAL
OVERVIEW
Developed Markets Emerging Markets
0.00% 10.00% 20.00% 30.00% 40.00%
UNSPECIFIED 4%
MID-EAST & AFRICA 6%
AUSTRALIA 9%
LATIN AMERICA 10%
ASIA ex JAPAN & CHINA 10%
CHINA 23%
JAPAN 3%
EUROPE 5%
US & CANADA 30%
REGIONAL BREAKDOWN
41. PERFORMANCE
(USD)
OMGB EFFICIENT INTERNATIONAL FOF (USD)
28 FEBRUARY 2011
$5 000.00
$7 000.00
$9 000.00
$11 000.00
$13 000.00
$15 000.00
$17 000.00
20 SEP 2005 (INCEPTION) - 28 FEB 2011
PERFORMANCE IN BASE CURRENCY (USD)
OMGB Efficient International FoF : +29% MSCI World Index : 10% High Water Mark USD 3M LIBOR
42. PERFORMANCE
(ZAR)
OMGB EFFICIENT INTERNATIONAL FOF (USD)
28 FEBRUARY 2011
R9 000.00
R10 000.00
R11 000.00
R12 000.00
R13 000.00
R14 000.00
R15 000.00
R16 000.00
R17 000.00
R18 000.00
R19 000.00
20 SEP 2005 (INCEPTION) - 28 FEB 2011
PERFORMANCE IN LOCAL CURRENCY (ZAR)
OMGB Efficient International FoF : +68% MSCI World Index : +24%
43. RANKINGS
OMGB EFFICIENT INTERNATIONAL FOF (USD)
28 FEBRUARY 2011
GIFS* Rankings to 28 Feb 2011 5 YEARS 4 YEARS 3 YEARS 2 YEARS 1 YEAR
USD Aggressive Allocation Return Rank Return Rank Return Rank Return Rank Return Rank
Fidelity RMT-Balanced 40.67 1 23.20 2 6.68 8 66.83 13 14.36 28
SCB MPF Ad-Fidelity GIF Bal 39.56 2 22.23 4 5.97 9 66.02 15 14.07 30
Sun Life First State MPF Progrs Gr A 39.26 3 22.42 3 7.37 7 63.79 19 15.66 14
OMGB Efficient International USD 38.31 4 24.98 1 20.15 2 39.74 54 12.36 48
Principal 600 Glbl Growth 36.08 5 15.51 6 1.57 17 64.30 16 17.29 10
Principal 800 Glbl Growth 36.05 6 15.61 5 1.64 16 64.30 17 17.30 9
Principal 500 Balanced Growth A 31.80 7 11.77 16 -0.91 29 61.68 25 16.06 13
SCB MPF Ad-Schroder Bal Inv 31.67 8 15.31 7 4.98 10 61.39 26 14.89 19
SCB MPF-Balanced 31.49 9 13.76 9 2.20 15 53.93 39 14.78 21
Invesco MPF Balanced A 31.28 10 12.24 13 1.56 18 50.09 47 12.40 47
SCB MPF Ad-Balanced 31.18 11 13.75 10 2.28 14 53.63 40 14.67 22
ING MPF MT Basic Bal Growth 31.02 12 13.09 11 4.35 11 57.34 33 13.86 33
Schroder MPF Balanced Invmt - A 30.43 13 13.91 8 3.66 13 61.91 24 14.50 26
ING MPF MT Comp Bal Growth 30.17 14 12.52 12 3.92 12 56.96 35 13.62 37
Bank Consortium E70 Mixed Asset 29.68 15 11.34 17 0.29 21 55.23 38 14.57 24
RCM Balanced A 29.30 16 12.15 14 -0.68 28 52.72 43 14.79 20
BEA (IS) Growth 28.94 17 10.91 19 1.30 19 58.87 29 13.20 40
SCB MPF Ad-RCM Bal 28.06 18 11.29 18 -1.24 30 52.01 44 14.50 25
SCB MPF Ad Invesco Glbl Bal 26.37 19 9.30 21 -0.15 26 48.22 48 11.53 51
BEA (MPF) Growth 26.11 20 8.95 22 0.16 24 57.41 32 12.72 45
Number of investments ranked 45 50 53 65 68
Peer Group Average 19.34 4.34 -0.53 56.70 12.43
*GIFS = Global Investment Fund Sector
44. A division of Efficient Group
EFFICIENT PRIVATE CLIENT BOUTIQUE
47. Contact us on :
012 460 9580 (Pretoria)
021 410 6000 (Cape Town)
www.efselect.co.za
All information used in this presentation and any material referred to herein is subject to
copyright and may not be reproduced or used (other than for information purposes) in any
way, unless prior written permission has been granted by Efficient Select (Pty) Ltd or the
appropriate copyright owner.
This presentation is intended for information purposes only and none of the information
contained in this presentation constitutes investment advice or a recommendation,
solicitation or offer by Efficient Select (Pty) Ltd to buy or sell any financial product. The
information contained in this presentation has been prepared without consideration of the
investment objectives, financial situation or particular needs of any particular recipient.
Any transactions described in this presentation may give rise to substantial risk, including
the possible loss of principal value, and are not necessarily suitable for all investors. This
presentation should accordingly not be considered as a substitute for the exercise of your
own judgment or for obtaining independent advice based on your personal preferences
and circumstances. Although all precautions have been made to ensure reliability of data
and information contained in this presentation, Efficient Select (Pty) Ltd cannot guarantee
the reliability or accuracy thereof.
Past performance referred to in this presentation is not necessarily indicative of future
performance. Similarly, forecasts contained in this presentation involve risks and
uncertainties which may result in future performance, outcomes and results which differ
materially from such forecasts. You are accordingly cautioned not to place undue reliance
on any historical data, general information or forecasts used in this presentation.
Efficient Select (Pty) Ltd accepts no liability whatsoever for any loss, damage (direct or
consequential) or expense suffered by a recipient as a result of undue reliance placed on
any information contained in this presentation.
Authorised Financial Services Provider • FSP No: 859
