Bastian Teichgreeber
At Prescient Investment Management, we’ve spent more than 26 years building a disciplined, systematic investment process. What sets us apart in a crowded industry? We are driven by data, not by stories.
The investment landscape is flooded with commentary, some insightful, some speculative. While compelling narratives capture headlines, they don’t necessarily lead to better outcomes. At Prescient, we focus on cutting through the noise through objectivity, data integrity, and technological innovation.
Turning data into an edge
Our systems process almost a billion data points daily. But access to data isn’t enough; what matters is transforming that data into knowledge. Our team of 35+ tech-savvy professionals, from quantitative analysts to data scientists, brings together financial expertise and technical mastery to deliver consistent, long-term outcomes.
The Prescient Economic Indicator
One innovation we’re proudest of is our proprietary Prescient Economic Indicator (PEI), our nowcasting tool for real-time US economic assessment.
Why the US? It remains the global economy’s heartbeat. Traditional measures like GDP are released infrequently, are backwards-looking, and are distorted by seasonal adjustments. We needed something faster, smarter, and more relevant.
The PEI incorporates macro datasets from net exports and business confidence to private investments and labour conditions. Unlike static models, our indicator adjusts dynamically, achieving 74% accuracy in real-time US GDP estimation. This removes guesswork, creating factual, objective economic narratives that let us anticipate change and position portfolios accordingly.
Understanding the Fed through AI
Everyone listens to Jerome Powell, but few understand the deeper tone in all Fed communications. We built an NLP-based speech analysis tool that scans every Fed speech in real time, whether by Powell or regional presidents, classifying tone (dovish, hawkish, neutral) and analysing content focus: inflation, growth, financial stability, and specific sector concerns.
This tool quantifies every speech and links insights to market movements. When flagging hawkish tone, interest rates tend to rise. When sentiment turns dovish, rates ease. That predictive power enables confident, forward-looking asset allocation decisions.
Predictive power in crisis
Our tools’ real value emerges during market stress. Pre-2008, our algorithms detected spikes in negative financial sector sentiment in Fed communications well before widespread crisis recognition. By early 2009, as tone shifted toward cautious optimism, our models flagged early recovery stages.
During COVID-19, with financial institutions not central to turmoil, our tools confirmed the Fed’s neutral-to-positive financial sector sentiment, helping us avoid overreactions.
Global expansion
We’re scaling beyond the Fed, applying speech analysis to the South African Reserve Bank and exploring other global central banks. If words are spoken, we turn them into numbers, track sentiment, and act accordingly.
The future
Technology isn’t our buzzword; it’s foundational to our investment process. We don’t believe in hunches or hero trades but in building systems that remove bias and enhance clarity.
This is investing’s future: data, technology, and rigorous analysis outperforming intuition and noise. At Prescient, we’re not just adapting to that future. We’re building it.
Disclaimer:
Prescient Investment Management (Pty) Ltd is an authorised Financial Services Provider (FSP 612). No action should be taken on the basis of this information without first seeking independent professional advice.
Please note that there are risks involved in buying or selling a financial product, and past performance of a financial product is not necessarily a guide to future performance. The value of financial products can increase as well as decrease over time, depending on the value of the underlying securities and market conditions. There is no guarantee in respect of capital or returns in a portfolio.
The information contained herein is provided for general information purposes only. The information and does not constitute or form part of any offer to issue or sell or any solicitation of any offer to subscribe for or purchase any particular investments. Opinions and views expressed in this document may be changed without notice at any time after publication and are, unless otherwise stated, those of the author and all rights are reserved. The information contained herein may contain proprietary information.
The content of any document released or posted by Prescient is for information purposes only and is protected by copy right laws. We therefore disclaim any liability for any loss, liability, damage (whether direct or consequential) or expense of any nature whatsoever which may be suffered as a result of or which may be attributable directly or indirectly to the use of or reliance upon the information.
For more information, visit www.prescient.co.za
Collective Investments: The cornerstone of savings and investments
Collective investments are fast becoming the cornerstone of how South Africans save and invest. From unit trusts to exchange-traded funds (ETFs), these vehicles let investors pool money, access professional management and gain diversification that’s tough to achieve solo. Big institutional managers like Alexforbes and research-driven firms like Prescient are shaping the next phase of this growth.
The sector is expanding, but with different engines. In South Africa, the exchange-traded product market (ETFs, ETNs and AMCs) ended in December 2024 at about R225.4 billion in market capitalisation. Meanwhile, the broader unit trust/collective investment schemes industry stood at about R3.87 trillion at the end of 2024, rose to about R3.93 trillion in Q1 2025, and exceeded R4 trillion by end-Q2 2025.
Beyond vehicles, ESG (Environmental, Social and Governance) integration is reshaping portfolio construction. Both Alexforbes and Prescient emphasise transparency, sustainability and robust research in how they build and report on portfolios. Technology is another force multiplier: user-friendly digital platforms are making collective investments more inclusive and transparent.
Crucially, it’s not a zero-sum game. ETFs offer transparency, cost efficiency and intraday tradability; unit trusts offer breadth, depth and governance for long-term goals. The real skill is matching the vehicle (or mix) to the client’s objectives.
Outlook: Expect continued growth in collective investments, underpinned by technology, transparency, and sustainability. With complementary strengths, managers like Alexforbes and Prescient are well placed to guide investors through this evolving landscape.
Demystifying fees and transparency in collective investments
For most investors, the big questions are: what am I paying, and what am I getting? Small percentages compound over time, and clarity builds trust.
ETFs vs unit trusts: different fee plumbing
ETFs tend to carry lower total expense ratios, but investors also face brokerage and bid-offer spreads when trading. Unit trusts embed costs in the fund (for example, management, platform, and advice fees), which can feel simpler and more predictable for long-term investors. Neither is ‘better’ in a vacuum; it depends on objectives, behaviour and time horizon.
Using scale and research to lower costs
Alexforbes often leverages its multi-manager scale to negotiate competitive fees while providing holdings-level disclosure and risk reporting. Prescient emphasises research-led efficiency and clear client communication (including ESG-linked reporting).
Regulation and safeguards
All South African collective investments operate under the Collective Investment Schemes Control Act (CISCA) and the Financial Sector Conduct Authority (FSCA) oversight, with independent custodians safeguarding assets and mandatory disclosures standardising how fees/risks are explained. This framework is designed to protect investors and improve comparability.
Value over ‘cheapest’
While fees matter, long-term value also comes from diversification, governance, and risk management, the things that keep investors on track through cycles. A transparent, fairly priced solution that aligns with your goals usually beats the absolute lowest-cost option that you’re unlikely to stick with.
Gyongyi King, Chief Investment Officer: Retail Investments and Private Markets
Alexforbes: guiding investors through collective investments
With more than three decades of investment expertise, Alexforbes demystifies collective investments to help South Africans invest with confidence.
Collective investments provide access to professional management, diversification and transparency. While, the investment world can seem intimidating and complex, Alexforbes has spent more than 30 years helping clients cut through that complexity.
“Through our collective investment solutions, we make professional money management accessible, affordable, and transparent,” says Gyongyi King, Chief Investment Officer: Retail Investments and Private Markets. “This means individuals can invest with confidence, whether they’re first-time investors or seasoned professionals.”
A collective investment scheme pools money from many investors into one fund, managed by professionals who invest across a diversified portfolio of assets. Instead of choosing individual shares or bonds, investors hold ‘units’ that rise or fall in value with the performance of the underlying investments. This model provides access to economies of scale, risk diversification, and expert oversight.
Both unit trusts and exchange-traded funds (ETFs) are collective investments, each with their own characteristics. ETFs trade on the JSE throughout the day, with prices fluctuating in real time. They typically pay out income in cash. Unit trusts, by contrast, are priced once daily, with all investors transacting at the same price and income usually reinvested. This provides simplicity, consistency, and smoother pricing.
“While ETFs are valuable for retail investors seeking low-cost, transparent market access, Alexforbes’ scale and expertise reduce the need for them within our multi-manager portfolios,” points out King.
“Through deep manager research, economies of scale, and active oversight, we deliver the benefits of diversification and cost efficiency that ETFs promise, and often more.”
Every investment carries risk. ETFs generally offer lower fees and index-like returns, but they are subject to market volatility. Unit trusts may carry higher costs, but they provide broader diversification and the potential to outperform through active management. Alexforbes mitigates these risks for clients through multi-manager diversification, careful manager selection, and continuous monitoring. “By blending active and passive strategies where appropriate, we optimise returns while keeping risk in check,” says King.
“Transparency underpins everything we do. We disclose full portfolio holdings, provide detailed reports on performance and fees, and appoint independent custodians to safeguard assets. Compliance with South Africa’s regulatory framework ensures additional layers of governance and client protection.”
South Africa’s collective investment industry is growing rapidly. ETF assets more than doubled between 2022 and 2024, while unit trusts surpassed R4.1 trillion by mid-2025. Trends such as ESG investing, digital platforms, and regulatory evolution are reshaping the landscape.
Alexforbes expects ETFs to gain traction among retail investors, while unit trusts remain the cornerstone of long-term retirement savings. “We see collective investments as more than financial products,” says King, “they are a pathway to long-term security, built on expertise, transparency, and trust.”