The good reputation of 2017 is now well established whereas 2018 is generally viewed as having been “challenging”. That said, the recently released MR de Compostella from Bruwer Raats and company, supersedes the 2017 in quality, at least at this early stage.
Of course, Raats sources grapes from various sites across Stellenbosch allowing him at least partially to circumvent the difficulties any particular growing season might present and whereas the 2017 vintage saw Cabernet Sauvignon the most dominant variety, the 2018 leads with 54% Cabernet Franc followed by 23% Cabernet Sauvignon, 15% Malbec, 5% Merlot and 3% Petit Verdot. In addition, the 2018 ended up spending approximately 27 months in barrel compared to the usual 22 to 24 months.
Somewhat surprisingly given the amount of Cab Franc, the result is a muscular, full-bodied wine. Red and black berries, violets, some leafy character and cigar box on the nose while the palate is substantial but also entirely seamless – good depth of fruit and fine tannins. It’s an impeccably well managed offering as followers of this label have come to expect. Price: R1 650 a bottle.
CE’s rating: 94/100.
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Marelise Niemann of Momento has become a champion of Grenache in all its colours: Noir, Gris and Blanc and it’s fascinating to see how each of these manifests themselves across the range. Tasting notes and ratings for the soon-to-be-released 2020s as follows:
Momento Grenache Blanc 2020
Price: R250
Grapes from Stellenbosch and Voor Paardeberg, three days of skin contact – the second vintage of this wine but only 460 bottles made as Niemann also used it as a component in her white blend. Citrus and peach plus herbs, spice and earth on the nose. The palate is light and fresh with a super-dry finish. Tightly wound and yet very flavourful.
CE’s rating: 93/100.
Momento Grenache Gris 2020
Price: R250
Grapes from Voor Paardeberg, seven days of skin contact; also includes a dash of Verdelho. The nose is rather neutral but hints of red apple and spice can be discerned while the palate has pleasing weight and texture offset by bright acidity, the finish long and pithy.
CE’s rating: 91/100.
Momento Chenin Blanc Verdelho 2020
Price: R250
A blend of 55% Chenin Blanc from both the Paardeberg and Bot River, 30% Verdelho from both Bot River and Voor Paardeberg and 15% Grenache Blanc as above. A complex nose with some smoky reduction before notes of citrus, peach, apricot, some yeasty complexity, ginger and other spice. The palate is rich and round with layers of flavour, tangy acidity lending vitality, the finish long and dry. The Grenache Blanc lends an extra dimension, and this is shaping as a very smart Cape White Blend, perhaps now deserving of its own proprietory name, something that Niemann says she is indeed considering.
CE’s rating: 95/100.
Momento Grenache 2020 coming soon.
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June in Europe means Bordeaux, Bordeaux and more Bordeaux … mostly in this case En-primeur 2020 trials and tribulations. As much as we love buying, selling and certainly drinking great benchmark Bordeaux, most of the UK fine wine trade has equally grown to despise the playground escapades that the Chateaux and negociants roll out year after year as if they were somehow reinventing the wheel and changing the course of human civilisation. But at least this year we have been spared the “greatest vintage ever” amateur dramatics line in favour of the “third in a trio of great vintages” mantra along with 2018 and 2019. With no international wine merchants travelling to Bordeaux due to the coronavirus pandemic travel bans and most international critics only tasting and rating the bold and the beautiful of the Grands Vins in the comfort of their living rooms before inevitably deluging their neighbours with vinous gifts of Chateau Lafite-Rothschild and Chateau Margaux, it certainly has been a slightly underwhelming campaign so far.
But of course, on the front line of the fine wine trenches in London, there is never a dull moment and not even the pandemic has managed to stifle new fine wine releases and offers from around the globe. Indeed, the market is hungry, thirsty and most importantly, cash-rich as the government make it almost impossible for high earners to spend their hard-earned money on practically anything substantial! On the front-line fine wine trenches, today a flare was fired into the dark sky to signal the arrival of the long-awaited Glenelly Estate Lady May 2015 Cape Bordeaux Blend. A sneaky early raiding party of six cases were hurriedly added to a palate leaving South Africa ahead of the main UK allocations shipments and finally arrived today with great excitement. You can most certainly expect the Lady May 2015 release campaign to be one of the most talked-about since the 2015 Kanonkop Paul Sauer launch.
A fine wine name slowly but surely carving out a defined international following, Glenelly is a beautiful property buried in a little corner of the Idas Valley in Stellenbosch. I had been meaning to visit for many years to understand its true essence, their French heritage and their philosophy but somehow always seemed to cross paths with CEO Nicholas Bureau or their long-time winemaker Luke O’Cuinneagain at tastings in London. The property was of course famously bought in 2003 by Madame May de Lencquesaing of Chateau Pichon Longueville Comtesse de Lalande fame in Pauillac, Bordeaux, with a vision to transform it into one of the pre-eminent fine wine producers in Stellenbosch.
With vineyards planted on near-virgin granitic rich soils, Glenelly had the opportunity to map out a varietal path that completely suited the style of wines they were looking to make. There would certainly be none of the red tape and restrictions Madame May had become so used to in Bordeaux. With sizable plantings of Chardonnay, Syrah, Merlot, Cabernet Sauvignon, Cabernet Franc and Petit Verdot, Glenelly now has all the building blocks for making some impressive wines. I did finally visit the estate back in February 2020 for a lengthy tutored tasting with O’Cuinneagain and Bureau, who generously opened an impressive array of older wines to illustrate not only the development of the wines in bottle but also the evolution of the estate’s winemaking philosophy and their ongoing quality improvements year on year. Undoubtedly, from the beginning, you could see that these were wines made in a more classical, restrained style and the French Bordeaux heritage was undeniable, radiating out of every glass and making all the wines in the range excellent gastronomic friendly expressions.
Undoubtedly the highlight of the tasting for me was an impromptu mini-vertical of the 2010, 2013 and 2014 Lady May flagship red blends, and as I boasted at the time, I certainly could not resist twisting Luke’s arm to dig out a bottle of the as then, unreleased, 2015. Needless to say, there were a lot of spark and fireworks that day, many of which were indeed reignited when Wine Magazine editor Christian Eedes tasted the Lady May 2015 and rated it a comfortingly similar 96/100 points. I however, was not lucky enough to taste the fabulous 2015 Lady May alongside some of Bordeaux’s greatest red wines such as Rauzan Segla 2015, Cos d’Estournel 2015 and Chateau Angelus 2015. But as Christian knows all too well, I am a massive fan of blind comparative benchmark tastings. If you think your wine is one of the best, why not put it up against some of the best? This is of course what many producers have done before, but somehow, these previous comparative tastings did not seem to capture quite the same historical significance as the Lady May 2015 comparison tasting undoubtedly because of the extra Madame May de Lencquesaing of Chateau Pichon Longueville Comtesse de Lalande connection.
As great as the Lady May 2015 may turn out to be, it is never wise to rest on one’s laurels which is why I was thrilled to be offered the chance to taste the embryonic Lady May 2016 and 2017 alongside each other. For benchmarking purposes, I opened another bottle of the newly arrived Lady May 2015 vintage just to make sure that I made an accurate and measured assessment of these two new budding Cape Bordeaux blend beauties. Notes and scores follow.
Glenelly Estate Lady May 2015, WO Stellenbosch, 14.5 Abv. (Tasting date: 08 June 2021)
79% CS, 8% M, 8% PV, 5% CF
Deep, dark and broody, this wine speaks with all the authority and confidence of a 5-star blockbuster vintage. Brimming with black menthol cassis, boiled blackberry sweets, black cherry and tight-grained cedar spice, this wine wears a superhero gown of graphite and stony minerality and whispers quality from the moment it hits the glass. Tight, focused and impressively compact, there is a seamless saline black currant balance with linear polished marble tannins and a super intense concentration. This is the culmination of years of winemaking refinement and is, without doubt, the
finest red wine commercially released to date at the Glenelly revealing the true terroir quality potential of these groomed, premium Stellenbosch vineyards. Drink from release and over the next 20+ years.
(Score: 96+/100 Greg Sherwood MW)
Glenelly Estate Lady May 2016, WO Stellenbosch, 14.5% Abv. (Pre-release
sample)
80% CS, 8% M, 6% PV, 6% CF
The 2016 blend throws a particularly dark, opaque red/black colour in the glass. Dark and foreboding but also ever so inviting at the same time. The aromatics are quite defined with perhaps the Cabernet Franc component currently punching way above its weight of 6% with seductive notes of freshly shaved cedar lead pencil spice, graphite, iron filings, iodine and the now hallmark Lady May character of dark, black, menthol cassis and peppermint crisp milk chocolate nuances. The palate is wonderfully suave and sleek, creamy and mouth coating with an accessibility and generosity of black and blueberry fruits that is very comforting and familiar. But just when you think the mouthfeel is all about silky tannins and fleshy black fruit concentration, the delicious tangy acids kick in to land this Hercules of a wine cleanly and effortlessly on the runway without even a hiccup. Like so many 2016 super-premium Cape Bordeaux blends from Stellenbosch, this wine thrills, seduces the senses and certainly impresses for the vintage. Drink from release or cellar for 10 to 15 years.
(Score: 94-95/100 Greg Sherwood MW)
Glenelly Estate Lady May 2017, WO Stellenbosch, 14.5 Abv. (Pre-release
sample)
90% CS, 6% M, 6% PV
If the 2015 Lady May blockbuster resembles a powerful, dense, Pauillac-styled Cabernet Sauvignon led red blend, then the 2017 is pretty much the antithesis, boasting the most elegant, silky, seamlessly harmonious texture combined with an attractively fragrant, Margaux-esque delicacy and graceful precision. While super youthful, the wine inevitably displays some of the lush, alluring and reassuringly expensive new oak creaminess, boasting layers of warm buttered brown toast smothered in black currant preserve, fresh espresso, hints of mocha dust and delicate vanilla pod spice notes. But probably the most pleasing element about this wine is the way winemaker Luke O’Cuinneagain has absolutely captured the truest essence of the 2017 vintage with its extreme purity, weightless fruit concentration that dances across the palate together with a focused, piercing intensity on the long, luxurious finish. This is class personified and I for one am completely smitten. Drink on release and over 25+ years.
(Score: 97-98/100 Greg Sherwood MW)
The moral of the story is perhaps that while Bordeaux’s example has, does and always will permeate almost every aspect of premium fine wine production around the world, the real role model is what the region has achieved and offers the world in terms of production quantities and economies of scale, combined with exceptional quality year on year with age-ability – that has to be something to be greatly admired and even revered.
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The young Neil Bruwer has been head winemaker at this Franschhoek property since 2019, and could not resist using a 1965 block to produce the first Chenin under a Chamonix label since 2006.
Fermented and matured for seven months in old oak, this is a wine of billowy power (alcohol is 14.02%). Complex aromatics of citrus, peach, and apple plus flowers and herbs, a hint of waxy complexity, ginger, and other spice before a palate of great presence – massive fruit concentration and flavour matched by driving acidity, the finish long and savoury. Combines both intensity and energy to a thrilling effect. Price: R385 a bottle.
CE’s rating: 97/100.
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Whereas the end of harvest is usually accompanied by plenty of speculation and conjecture as to wine quality, 2020 of course saw the country in lockdown and as a result, little of the normal discussion took place. The first of the wines from this vintage are now reaching the market, however, and the results are looking exceptional, the latest releases from Lukas van Loggerenberg a case in point.
Van Loggerenberg Trust Your Gut Chenin Blanc 2020
Price: R375
60% of grapes sourced from Paardeberg and 40% Polkadraai Hills. “Batman and Superman both have their strengths but what if they joined forces?” is winemaker Lukas van Loggerenberg’s rhetorical question by way of introduction to this wine and the outcome of blending Swartland with Stellenbosch is something formidable. The nose shows citrus and peach with slight notes of struck match, wet wool, and talcum powder in the background. The palate, meanwhile, is extraordinarily compact and concentrated with bracing acidity and a finish that goes on and on. It’s a wonderfully precise, well-proportioned, and nuanced wine.
CE’s rating: 98/100.
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Van Loggerenberg Geronimo Cinsault 2020
Price: R305
Grapes from a 1974 vineyard in Faure, Stellenbosch. 40% whole-bunch fermentation. Subtle and ethereal aromatics – initially pretty notes of rose, herbs, red currant, raspberry, and plums but darker berries, olive, and spice come to the fore with time in the glass. The palate has pure fruit, invigorating acidity, and fine yet grippy tannins. Great structure – neither too frivolous nor too brutish. Very well-judged.
CE’s rating: 95/100.
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Van Loggerenberg Breton Cabernet Franc 2020
Price: R375
50% of grapes from Polkadraai Hills, 50% from Faure, the former portion picked early and under-going whole-bunch fermentation, and the latter slightly delayed and destemmed. Striking aromatics of red and blackberries, olive, herbs, tomato leaf, and a hint of violets. The palate is medium-bodied and nicely poised – good fruit definition, fresh acidity, and some crunch to the tannins (alcohol is 13%).
CE’s rating: 94/100.
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Van Loggerenberg Graft Syrah 2020
Price: R450
Grapes from the same Polkadraai Hills vineyard that Reneen Borman utilizes for Sons of Sugarland but so different in styling, this wine undergoing 100% whole-bunch fermentation before maturation lasting nine months in second-and third-fill 500-litre barrels and the result being altogether darker and more textural than what Borman comes up with.
On the nose, a heady mix of red and black berries, pepper, dried herbs, olive, and violets while the palate has good weight, fresh acidity and firm but by no means coarse tannins – a dense and savoury affair (alcohol is 13.5%).
CE’s rating: 95/100.
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Chris and Andrea Mullineux of Leeu Passant.
Andrea and Chris Mullineux’s venture beyond the vineyards of the Swartland (and into Cape heritage too) is proving a rather brilliant success. Last week saw the release of the latest vintages of the five Leeu Passant wines. The pleasure of attending the launch function was that – unlike last year when it was held on Zoom – it involved a visit to the beautiful tasting room (sorry, wine studio) of Mullineux and Leeu in Franschhoek, via the even more beautiful gardens – designed by the great Francesca Watson with as much flair, understanding and attention to detail as Andrea reveals in her wines. You should go.
Even better, all the vintages released to date of the Leeu Passant Chardonnay (2015–2020) and Dry Red Wine (2015-2017) were on offer, and there’s nothing like a vertical tasting, even when only a comparatively short one is possible, for helping to understand what a wine is all about, and to underscore the importance of bottle maturation for serious wines like these.
This is most obvious with the Chardonnay, which has always come from the same Helderberg vineyard block, and been made in essentially the same way. Vintage differences (and, obviously, levels of maturity) make for subtle difference of flavour profile and structure, but there’s a continuity: a balance of fairly rich, ripe power and intensity with textural finesse and freshness, and a lingering stony, lemon-tinged finish. As to the benefit of ageing, I remember noting five years ago that the maiden 2015, while elegant and vibrant, was showing evidence of new oak barrels; now that oak frame has been pulled into a developing complexity. There are real hints of tertiary development, and I’d suggest that those for whom developed flavours are less appealing than the charm of relative youth should start drinking it up now. The 2016 (a particularly small production) seemed more intense and perhaps more complex, certainly more youthful. For me the 2017 was already particularly lovely, both charming and flinty – hard to resist now, but I’d give it another few years to resolve everything into harmony. 2018 is very young still – the oak pronounced, the acidity not harmoniously integrated yet.
As to the newly released 2019, from a generally excellent vintage of warm Stellenbosch days and cool nights – does it justify its price as one of South Africa’s most expensive chardonnays, at around R700? Well, it’s certainly there amongst the elite in terms of quality, and now with something of a track record to show its claims to the potential of bottle maturity. This 2019 will flesh out over the coming years, but it’s now splendidly tight and bright, with a subtly forceful intensity, and I suspect it will be as fine as the 2017.
There are two 2018 cinsaults, from the two oldest red vineyards in the Cape – originally intended only for the Dry Red blend, but too interesting and distinctive not to also be bottled separately. The 1932-planted Franschhoek vines give a remarkably elegant, focused wine, perfumed but more savoury than fruity, nicely grippy, with a succulent, subtle intensity. The more tawny-coloured Wellington version (from a vineyard planted no later than 1900) gives a more obviously fragrantly fruit-filled wine, tighter and more tannic yet with more obvious charm. Personally, I’d dither for ages (while happily sipping) if I had to choose a favourite. Both are superbly dry and refined, amongst the small handful of really ambitious Cape cinsaults, and priced accordingly at approaching R600 per bottle.
If it’s a (relative) bargain from Leeu Passant that you’re after, the Stellenbosch Cabernet Sauvignon is a good one, at about R400. Quietly fragrant, notably dry, with dry chalky tannins, a delightful core of sweet fruit discernible in the balance, decent freshness, and no obvious oak. A declared alcohol of 13.5%. With most Stellenbosch cabs still struggling to emerge from a fixation with power, oak and very ripe flavours, this is for those who hanker after something approaching traditional Bordeaux savoury restraint.
Something similar, in fact, could be said for the Dry Red Wine, especially that combination of a ripely sweet centre of fruit in a dry, supple structure. Within an overall aesthetic, there have actually been some significant changes over the four released vintages, in terms of varietal mix and alcohol levels. Without going into details, let me say the wines are maturing very well, with the 2015’s tight, dry tannins integrating pleasingly. In this line-up, it was my favourite, in fact, certainly for drinking now. The cinsault component undoubtedly helps in terms of early approachability, and the only sin in drinking Leeu Passant Dry Red young is that you’re missing out on greater complexity and a finer, more resolved structure.
The current 2018, at just over R1 000 per bottle, no longer looks quite as expensive, given recent leaps in price from various likely and unlikely candidates, as the maiden 2015 did at a bit under that magical boundary. Its cabernet sauvignon component, ex Polkadraai, at 63% is the largest yet, with 21% Helderberg cab franc (2015 had 35% sauvignon and nearly as much franc). And the cinsault component is the lowest yet, at 16% (31% in 2015) – although there is a surprisingly generous cinsault perfume. The varietal differences are all vintage-dependent – Chris and Andrea evidently concluded that the great, fruit-rich charm of the 2018 would be a touch excessive if it included as much cinsault as had hitherto been considered appropriate to the blend. I must admit that it’s lovely to drink early (especially if well aerated by time uncorked or by splashy decanting, I’m sure), but rather give it more time to justify its price by what it will gain by maturing in the cool darkness of a well-stored bottle. Will it still be giving pleasure in half a century or more, like its great Cape models? A too abstract question for me, I fear, but I plan to monitor it for a while of its hopefully triumphant journey. It’s a very good wine indeed.
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The clue’s in the name. Whatever else you might say about the Luddite wines as made by the Verburgs of Bot River, they’re never going to show the polish that comes from the careful application of the newest and most sophisticated cellar equipment. Rather these are wines made without artifice, big on flavour and personality. Tasting notes and ratings for the latest releases as follows:
Luddite Chenin Blanc 2020
Price: R520
22 days of skin contact. Lots of flinty reduction before peach and pineapple on the nose. The palate has a sweet ‘n sour quality although technically bone-dry – good fruit density to go with bracing acidity before a saline finish (the alcohol is a mere 11.5% and residual sugar is 1g/l). An arresting drop.
CE’s rating: 91/100.
Luddite Shiraz 2017
Price: R710
Some whole-bunch fermentation before maturation lasting 24 months in mostly French oak, 32% new. The nose shows red and blackberries, iron fillings, cracked pepper and spice while the palate is surprisingly medium-bodied given an alcohol of 14.86% – a dense core of fruit is matched by a great line of acidity and nicely grippy tannins. Lots of flavour intensity without sacrificing balance.
CE’s rating: 93/100.
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For those pre-occupied with who handles the Burgundian varieties of Chardonnay and Pinot Noir best under local circumstances, then the wines made by Peter-Allan Finlayson of Crystallum are compulsory as reference points. Tasting notes and ratings for the soon-to-be-released 2020s as follows:
Crystallum The Agnes Chardonnay 2020
Price: R260
This multi-vineyard blend includes grapes from Ceres for the first time in addition to parcels sourced from the greater Hemel-en-Aarde and Elgin and this seems to have elevated the quality. The nose shows struck match, peach and citrus plus a hint of oatmeal while the palate has great depth, vibrant acidity and a savoury finish. Vivid and intensely flavoured. No mean achievement given that total production is 15 981 bottles.
CE’s rating: 94/100.
Crystallum Clay Shales Chardonnay 2020
Price: R580
Grapes from Hemel-en-Aarde Ridge. Elusive aromatics of pear, white peach, lemon and talcum powder while the palate is light and elegant – perhaps less concentrated than usual but nice freshness, the finish long and dry.
CE’s rating: 92/100.
Crystallum Ferrum Chardonnay 2020
Price: R580
A new wine, grapes from the Shaw’s Mountain area of the Overberg, planted on iron-rich soils and hence the name. Lemon and orange, some waxy, yeasty notes and spice on the nose while the palate is rich and full with well-integrated acidity and a savoury finish. Particularly characterful.
CE’s rating: 93/100.
Crystallum Peter Max Pinot Noir 2020
Price: R305
Grapes from four vineyards in the greater Hemel-en-Aarde area and one in Elandskloof. 40% whole-bunch fermentation. Some reduction before red and black cherry, a hint of musk and some herbal character. The palate is cheerful enough but a bit unknit – sweet, somewhat dilute fruit on entry before a very savoury, almost bitter finish. Total production: 26 178 bottles.
CE’s rating: 89/100.
Crystallum Mabalel Pinot Noir 2020
Price: R580
Grapes from Elandskloof, no whole-bunch fermentation. Seductive aromatics of red and black cherry, rose, musk, herbs and a hint of earth while the palate has weight and presence thanks to a dense core of fruit, nicely integrated acidity and powdery tannins. Very appealing in its plushness.
CE’s rating: 94/100.
Crystallum Bona Fide Pinot Noir 2020
Price: R580
Grapes from Hemel-en-Aarde Valley, 50% whole-bunch fermentation. Haunting aromatics of red cherry, flowers, herbs, spice and white pepper. The palate is spellbinding in the refinement, energy and tension that it shows – the greatest purity, bright acidity and impeccably fine tannins make this a new benchmark for the category in South Africa.
CE’s rating: 96/100.
Crystallum Cuvée Cinema Pinot Noir 2020
Price: R580
Grapes from Hemel-en-Aarde Ridge, 60% whole-bunch fermentation. Red and black cherries, beetroot, earth and spice on the nose while the palate is substantial yet seamless – good fruit definition, fresh acidity and smooth tannins. This has weight and texture in the best sense.
CE’s rating: 95/100.
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Three new Cape Wine Masters have graduated from the Cape Wine Academy, bringing the total number to attain this elite self-study qualification in its 42-year history to 109.
They are Gavin Whittaker, export manager for Asia & Middle East markets of Van Loveren, Rene Groenewald, product developer for Woolworths Dairy, and Lieza van der Merwe of Breedekloof cellar Merwida, formerly winemaker and currently manager of the tasting facility and marketing.
Gavin Whittaker’s dissertation is on the availability, choices, and production methods of no alcohol and lower alcohol (NOLO) wines in South Africa and whether there is a market for them. Rene Groenewald’s paper looked at environmental sustainability in the South African wine industry, while Lieza van der Merwe tackled drought, and how the extreme climatic conditions of the years 2015-2018 have affected the South African wine industry.
Dissertations will be available in full on the websites of the CWA and the Institute of Cape Wine Masters on 1 July.
Prescient’s Rupert Hare.
Sponsored – the following by Rupert Hare, Co-Head of Multi-Asset at Prescient Investment Management
Active funds have been subjected to continuous waves of attack from passive alternatives, and the gist of the argument is that they are in some way inferior to their passive peers. The reasoning is mixed, but the argument’s primary drivers are historic underperformance over the past five years, lower fees and fund costs, and high tracking errors vs what investors are expecting – i.e., you invest in “SA equities”, but often get a completely different animal with an active approach, with returns drifting away from the market.
While these points are valid, they’re also often subject to some serious framing by passive funds looking to aggressively capture AUM from other asset managers. They leverage off emotional biases of investors like the anchoring of views on recent performance and a degree of framing bias. For example, if you tell an investor that a fund is “one of the most expensive in its category”, that sounds rather gloomy on its own. But if you instead tell the investor that “while the fund is one of the most expensive in its category, it has by far the highest performance”, it will frame the fund in a completely different and more positive light. The point is that the most important thing investors can do is to focus on the facts and leverage off them in their judgment.
That brings us to the heart of this article, which may at first glance seem like the same topic the industry’s been talking about for the past five years – how and why active funds are losing money to passive alternatives. While that may be the case, there’s a lesser-known approach that could be a solution for investors and allow them to capture the best of both worlds – known as systematic investing, or process-driven asset-management leveraging off large amounts of data to make investment decisions. The key is to be able to take the best of active investing and combine it with the benefits of passive investing.
“Systematic” funds require smaller, more specialised teams with a background in both data science and asset management to process large amounts of data – which a traditional manager would require many boots on the ground for. The translation comes directly into the investor’s pocket, with lower fees required to cover fewer analysts.
Lower fees are the surest form of alpha. Looking into the evidence over the last five years for the ASISA Multi-Asset High Equity category, investors made an additional 0.53% for every 1% saved on fees. So why then is that relationship not 1 for 1? The answer lies in active management lifting that line up at the higher end of the total investment charge (TIC) spectrum through the creation of alpha. In other words, you can indeed get more by paying less, as well as earn more by paying more – both active and passive asset management have their place in a portfolio.
How can a fund then combine low fees with that positive alpha profile from active management through investment decisions? At Prescient, we believe the multi-asset investment nirvana is to combine low fees offered in passive funds with the potential for positive alpha offered in active funds. We do this by running our Prescient Balanced Fund with an efficient strategic asset allocation to anchor the portfolio similar to a passive approach, plus a systematic approach to taking tactical asset allocation tilts using reams of data distilled into simple investment decisions. We implement this by investing in predominantly passive indices using our portable alpha process rather than picking stocks. These three approaches, combined with one of the lowest fees in the market, allows the Prescient Balanced Fund to print small, consistent amounts of alpha year in and year out. And consistency, no matter which way you frame it, is just what investors are looking for.
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